As Russia’s economic situation worsens and Ukrainian defenses continue to hold, elite factions in Moscow are maneuvering for position in an uncertain future. Their goal is twofold: to protect the profits and privileges gained during the war, and to deflect blame for its mounting human and financial costs.
Russian President Vladimir Putin is concerned that the elite’s disunity and anxiety about the country’s future could undermine the cohesion of the Russian regime. To counteract this trend, the Kremlin has introduced unprecedented legal mechanisms for redistributing wealth under the banner of national security: from those suspected of even minimal disloyalty or Western ties, to individuals who may be less competent but demonstrably supportive of Putin. This puts the elites in a Russian-style prisoner’s dilemma, in which the safest strategy is to perform exaggerated loyalty while quietly undermining rivals to survive the conflict.
From the United States’ perspective, the challenge is to make sure these dynamics don’t become an obstacle to ending the Russia-Ukraine war. To do so, U.S. policy should continue making Russia’s government and industrial leadership feel anxious about the war’s costs and eventual settlement. Policymakers should signal that accountability for the invasion will be targeted rather than collective or indiscriminate. The war’s architects should continue to face sanctions, while elites who increasingly abstain from publicly backing the war effort should be led to expect more forgiving treatment.
Putin sought to make Ukraine the crown jewel of his decades-long rule by launching a full-scale invasion in 2022. But now, the system must protect him from the consequences of his actions. Within Russia’s ruling class, it is an open secret that the war has come at a staggering cost. Although the Russian government no longer discloses casualty figures, independent estimates by the BBC and Mediazona suggest that 165,000 Russian soldiers at minimum had been killed by the end of July. The open-source intelligence platform Oryx has documented the loss of more than 22,000 Russian military vehicles and equipment, alongside billions in damage from Ukrainian drone strikes and Western sanctions.
Someone will ultimately have to bear political responsibility for the scale of Russia’s losses. In a democratic system, Putin—Russia’s supreme commander and the chief architect of its Ukraine policy—would be the obvious candidate. But in Russia, the system is designed to shield him. His drive for political and perhaps physical survival aligns with the elite’s historic interest in preserving him as the central mediator among competing factions in the absence of functional democratic institutions that could have been doing his job. Yet the war has turned that mediator into a threat for many of those who once believed in his leadership.
The first signs of blame-framing are already visible. In 2024, around 122 criminal cases were opened against high-ranking Russian officials. Around 100 were arrested on suspicion of corruption between January and July. Dozens of Defense Ministry officials and military officers have also been arrested or dismissed. Yet the arrested officials are lucky as some failed to survive the war.
Since 2022, at least 27 senior business executives linked to strategic sectors have died under unclear circumstances. Most recently, Transport Minister Roman Starovoit reportedly died by suicide in July; while the circumstances around his death are unclear, some suspect that it could be related to an embezzlement investigation in the Kursk region, where Starovoit was governor before joining the Transport Ministry. Just shortly after that, Andrei Korneichuk, another transport official, suddenly died of a heart attack. The question that haunts officials at night—though never uttered aloud—is simple: Will I be next?
While the war has exposed Russian elites to existential risk, it has also proved highly profitable for others. Military-industrial tycoons, civilian business leaders tied to the defense sector, regional governors hosting key production sites, and elites who have seized control of Western assets have all benefited from wartime redistribution. Many have secured access to subsidized state-backed war loans, while the broader economy continues to face interest rates of 18 to 21 percent. Meanwhile, infrastructure projects have been delayed, preferential tax regimes rolled back, and housing construction has declined. Buying elite loyalty outside the war economy is becoming increasingly difficult for the Kremlin.
The government is also redistributing wealth to punish disloyalty—even the suspicion of it. Since 2022, the Kremlin has nationalized assets equivalent to roughly 2 percent of Russia’s GDP—around $49 billion. Lawyers now urge business leaders to renounce second citizenships, sever economic ties to so-called “unfriendly” countries, and invite “state-oriented partners” into their ownership structures. The case of Konstantin Strukov, deputy speaker for the Chelyabinsk region’s parliament and a member of Putin’s United Russia party, sent another obvious signal. Prosecutors accused him of transferring assets to his daughter Alexandra Strukov, a Russian Swiss dual citizen, and moving capital abroad. Within just nine days, a Russian court ordered the full nationalization of his businesses.
However, this is not a return to Soviet-style expropriation. Russian Finance Minister Anton Siluanov has clarified that Strukov’s former assets will be transferred to new owners through formal resale. While Russia’s economy struggles to find the new drivers of growth, strategic assets are being reallocated to those deemed more loyal and politically reliable. As Russian soldiers struggle on the front lines, select tycoons are positioned to benefit from this redistribution, aligning themselves with the Kremlin and emerging as early winners of the war.
Despite the deadline that U.S. President Donald Trump gave Putin for ending the war in Ukraine, the conclusion may still be far away. Yet any sense of an emerging cease-fire is likely to intensify all these trends. The blame game will certainly heat up, along with efforts to consolidate and protect war-related profits. Once Putin decides that the war must end, the assets acquired through wartime favoritism may quickly become liabilities that other elite members would want to reacquire under the shrinking economy.
With this in mind, Washington can allow anxieties among the Russian elite to deepen by sustaining the economic pressure and avoiding a rushed peace deal that favors Russia. The ideal approach to negotiations would reinforce the belief among Russian elites that the war is unwinnable and highly damaging to their personal wealth but that a settlement is still plausible. The United States should keep signaling diplomatic readiness for a deal without conceding to unrealistic terms, making Russian elites think twice about the potential benefits of unquestionable alignment with the Kremlin and the war’s rising costs.
The United States should also signal that, however the war ends, it will continue to sanction its architects while offering amnesty to elites who quietly distanced themselves from the war effort. Putin, insulated from the political and personal costs of the war, is unlikely to ever leave office on account of international pressure. But Russian elites are more pragmatic about the future of Russia’s relationship with the West. Conditional sanctions relief and the promise of reintegration should be available to those who avoid publicly voicing their support for the war or engaging in activities that directly fund and profit off it.
This approach would not cause mass defection by elites. But it would strengthen the incentives for lower-level government officials and business managers to hedge their positions and quietly disengage from a war that they increasingly see as unwinnable.
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