Cables From The Diplomatic Frontline - Putin's reshuffle: incentives at play and implications for the war and his regime.

Putin’s reshuffle and replacement of Defense Minister Shoygu: incentives at play.

• Putin’s post-inauguration cabinet reshuffle was mostly uneventful - where most members of the previous government that had helped to weather the COVID response and post-invasion/sanctions era of economic challenges were reappointed.

• But there were at least two notable changes worth discussing: replacement of the Minister of Defense and removal of Nikolai Patrushev from the post of National Security Council Secretary.

• Sergei Shoygu - the outgoing Minister of Defense has now taken Patrushev’s position as the Secretary of the National Security Council.

• The latter has now been demoted to being a Presidential aide.

• (side note: the 48 hour wait is in itself a little disrespectful - Patrushev has been a loyal and strident Putin ally for many years. Leaving him hanging in the air is an act of disrespect via omission. How is it that Shoygu promptly finds a new post but Patrushev does not, and has to wait two days to find out his new role?)

• The new Minister of Defense, Andrey Belousov, is on the other hand, someone who has not previously held any role to do with the military whatsoever.

• He is largely a technocrat and has been involved in running the economy in one way or another - whether as a First Deputy Prime Minister (his most recent role) or as a Minister of Economic Development before that.

• So then, what is the reason for this reshuffle?

• Why remove Shoygu?

• He is clearly still considered to be close and loyal enough to appoint as a National Security Council Secretary - so why remove him?

• And what does it say about Putin’s war plans if he is appointing an economist technocrat to lead the ministry?

• There is of course the obvious and often-repeated argument that Putin needed a better economic manager - now that so much funds flow into the military, and the new defense minister is precisely the type of a competent manager needed to allocate the incoming funds efficiently.

• But this is too obvious and could only be part of the equation - if it was truly only about fund management or efficient resource allocation, Putin could simply beef up the ministry and surround the previous Defense Minister Shoygu with expert economists - and force him to listen to them.

• There are clearly political and strategic reasons beyond these obvious incentives.

• So in this post, we shall first unpack most of the likely incentives that likely played a role in pushing Putin towards this decision.

• We shall then consider some second-order inferences that can be drawn and implications that could materialize as a result of this reshuffle.

Incentives at play.