Is Putin Becoming Desperate about Being "Best Friends" with Germany?

Taking a short break from European affairs before a planned guest appearance at the EU summit in Lahti, Finland on October 20, Russian President Vladimir Putin has a moment to reflect on his achievements after making an extraordinary effort at strengthening ties with Germany.Putin offered an unassailable gas monopoly, vertically integrated from extraction in Siberia to distribution in France and Italy, with only a few carefully selected, preferably German, partners, but the Europeans rejected that model. They are interested in setting up an “early warning” system for possible disruptions in deliveries from Russia. This failure is not exactly a testimony to the fact that market competition is a more efficient form of business organization compared with a monopoly; there are still too many bitter disagreements inside the EU around this proposition. In many ways, the root cause is Putin himself and his monopoly control over Russian energy policy. For the last three years, he has demonstrated to Western partners that property in Russia is not exactly protected by law, that contracts can be re-opened at any stage, and that licenses can be revoked on “environmental” grounds. Putin’s trademark “trust-me” approach now comes with a question mark, because all his promises are pinned to the main one -- to step down in 2008.