Putin steps up to run a vastly changed Russia (+video)

But he is returning in 2012 to lead a very different country. Most importantly he faces a rising middle class, a social category that was physically eliminated in the Soviet Union, and is only now achieving a critical mass of numbers sufficient to propel it into political action.

Since the collapse of the USSR, Russia has been "building capitalism," mostly under the direction of state bureaucrats. But the people who have been taking to the streets in recent months are the real deal: educated urban professionals and small business people whose demands for rule-of-law, property rights, an end to corruption and bureaucratic privilege, and fair elections come straight from the soul.

The size of the new middle class is much debated – about 15 percent, mostly concentrated in Moscow and other large cities, is a widely accepted figure – but there seems little doubt that their numbers will grow, especially if Putin achieves any measure of the economic development he is promising to deliver.

"The demands for reforms in our society are so strong that if Putin wishes to remain in his job for the next six years, he is going to have to take it into account," says Gennady Gudkov, a Duma deputy with the leftish Just Russia Party. "We need very deep changes, otherwise social stability will be in doubt… We are already seeing a radicalization of the protests, as young people grow disillusioned with peaceful demonstrations that the authorities happily ignore. If the authorities go on pretending that nothing is happening, more radical politicians will come to the forefront."

Skepticism about Putin's return

Among Russia's weary and disillusioned liberals, at least, there is a sense that Putin is already a known quantity who is unlikely to change the heavily-orchestrated, top-down political system that he built.

"I'd love to see a breakthrough initiated by Putin but, alas, I don't believe in it," says Nikolai Svanidze, a leading TV personality who recently joined the street opposition. "We already know Putin's character very well. I think he'll do his best to conserve the situation as it is, and no good will come of that."

Some say liberal economic reforms may be on the agenda, including a limited privatization of state-owned companies, pension reforms and commercialization of some social services. But Putin will be greatly constrained by his election program, which promised a stronger social safety net and major public spending on infrastructure and military rearmament. If he reneges on those pledges, he could face a mass upsurge from his own provincial, working-class base, which has so far been watching passively as the Moscow middle class protests.

"I think Putin is quite sincere when he says he wants to initiate reforms," says Andrei Kolesnikov, opinion editor of the opposition weekly Novaya Gazeta. "But his ideas of reform are very conservative. I think we may see mechanical economic changes, and he will try to preserve his social base. But political reforms aren't likely to be on his agenda at all. He may mention democracy in his speech, but events show that he sees no need to take actual steps toward the middle class. He thinks everything's OK the way it is."

As for Putin's inauguration today, Mr. Svanidze, who watched it on TV like most Russians, says it made a stark impression on him.

"Putin's motorcade, on a fine spring morning, was moving through the absolutely empty streets of downtown Moscow, as if it were on the Moon, in deafening silence. There was not a single soul, not even a dog, on the streets," he says. "He wanted to create a picture for the world, and he did: it was a picture of total isolation."

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