[h=1]Putin to Return to Presidency[/h] [h=3]By ALEXANDER KOLYANDR And RICHARD BOUDREAUX[/h]MOSCOWPresident Dmitry Medvedev proposed Saturday that Russia's ruling party support his mentor, Prime Minister Vladimir Putin, as its candidate in next year's presidential election, guaranteeing Mr. Putin's return to the office four years after he was legally obliged to step down. Mr. Putin immediately accepted the proposal, ending months of intense speculation over whether the president would seek a second term or step aside for his powerful predecessor. Mr. Putin then announced a job switch with Mr. Medvedev, saying he would be made prime minister after the March 4 election. Yekaterina Shtukina/RIA Novosti/Kremlin/ReutersRussia's President Dmitry Medvedev and Prime Minister Vladimir Putin on the move at the United Russia congress Saturday, where they announced they'd be trading jobs Thousands of delegates to United Russia's party congress, meeting at Moscow's Luzhniki Stadium, roared their approval of the proposals in the two men's back-to-back speeches. Mr. Putin became prime minister in 2008 after two terms as president, stepping aside because of constitutional term limits. As Russia's most powerful politician, he had been widely expected to seek a return to the Kremlin. Under constitutional changes, the presidential term starting in 2012 will be six years instead of four. The two-day party gathering was called to nominate candidates for the Dec. 4 parliamentary elections and discuss ways to reverse its declining popularity. It turned into a forum to support Mr. Putin's return to the presidency. On Friday and again Saturday, Mr. Putin spelled out his vision for the next six years. The gathering opened on a day Russia's Micex index of stocks fell 4% and the ruble lost 2.6% of its value against a basket of major currencies, battered by a global capital flight to safety. It capped the sharpest weekly decline of Russian markets in more than two years and appeared to augur a prolonged period of slow economic growth. Mr. Putin, who built his popularity on a strong economic recovery during the 2000s, told the delegates Saturday that Russia should return to annual growth rates of 6% to 7%, up from this year's 4%. He also promised to raise salaries and pensions and spend more on rearmament and infrastructure. To pay for those programs, he said, Russia would have to change its 13% flat income tax. "Taxes for the rich should be higher than for the middle class," he said. He also cautioned that the government would need to take unpopular steps to cope with global financial turmoil. "Responsible authorities should always not only listen to the heartbeat, but if they see and understand that there are some problems, then they should prescribe medicine," Mr. Putin said Friday, seated at a large table with party delegates. "The authorities should explain to people in a clear and understandable way, not with truncheons and tear gas, of course, but with discussion and dialogue." Yekaterina Shtukina/RIA Novosti/Kremlin/ReutersMessrs Putin and Medvedev soaking in the applause at the party congress The Russian leader said he was often criticized by human-rights activists, "sometimes fairly, sometimes unfairly." Although they tend to draw attention to "problems that don't touch everyday lives," he said, their complaints must be addressed or else people will feel cut off from their government. As he spoke, police detained a handful of demonstrators on the street outside the meeting hall. They were calling for a boycott of elections to protest the exclusion of some opposition parties from the ballot. United Russia has dominated the country's politics under Mr. Putin's leadership and has virtually no chance of losing the parliamentary or presidential elections. Under a system of "managed democracy," the Kremlin permits a few tame rival parties to campaign while outlawing others and breaking up their street demonstrations. Corruption, economic troubles and chafing at the Kremlin's centralized control over far-flung regions have hurt United Russia. The ruling party's support in opinion polls has fallen to around 40% in recent weeks. In the last parliamentary vote, in 2007, the party claimed 64% of the vote. Mr. Putin's remarks stopped short of signaling a more competitive political system. Instead, they reflected the party's attempt to push aside unpopular representatives and nominate candidates capable of listening to constituents and explaining government decisions. Mr. Putin had said previously that about half of the party's 311 deputies in parliament would be excluded from the list of roughly 700 candidates whose nominations were being announced Saturday. The switch in posts of the top leaders was a disappointment to Russian liberals, who had hoped that Mr. Medvedev would stand up to Mr. Putin, his long-time benefactor, and run for re-election himself. Mr. Putin's nomination is "a blow to the prestige of Russia's presidency," said Gleb Pavlovsky, head of Russia's Fund of Effective Policy. Mr. Medvedev "betrayed those who believed in him; it's political suicide that he of course has a right to commit." But Edward Limonov, a poet and leftist activist who has led frequent demonstrations against the government in Moscow, said Mr. Putin's return to the Kremlin was preferable to six more years of divided power at the top. "Putin is better for the opposition than Medvedev," Mr. Limonov said. "As a symbol of the enemy he is much better." Mr. Putin's return could prompt some technocrats in the Russian government to resign. Finance Minister Alexei Kudrin, whose name had lately been mentioned as a possible prime minister, will likely leave, said Sergei Markov, a deputy in Russia's State Duma with the United Russia Party. The future government has ambitious plans for economic growth "and these plans must be fulfilled," Mr. Markov told the Interfax news agency. "There's some question of whether Kudrin can do this." As finance minister, Mr. Kudrin has been an advocate of market-friendly policies and restrained spending. He publicly worried that Russia's dependence on oil exports would be problematic as production drops off in coming years. Lately investors have become edgy on signs that oil prices are weakening and have cashed out of Russia for more diversified markets. Boris Nemtsov, who served as deputy prime minister under the late President Boris Yeltsin, told the Echo Moscow radio station that Mr. Putin's return to the presidency is "the worse scenario for Russia." "Ahead of us will be increased migration, flight of capital, dependence on commodities, and enormous corruption in politics," he said. Sergei Mitrokhin, head of the opposition Yabloko party, called Mr. Putin's return no surprise. "What was proposed today by Putin and Medvedev along with United Russia is not a route to modernization; it's a route to new stagnation that will only end just as badly as the stagnation of Brezhnev that finished the Soviet Union," he said.