While Americans argue about the extent of Russia’s intervention in the U.S. presidential election, Russian President Vladimir Putin is battling both a recession and growing popular dissatisfaction at home.

It’s no surprise that Russia’s economy is struggling. The Putin regime’s grasp on power depends too much on subverting the rule of law to enrich allies and punish opponents – an approach that has undermined a long list of businesses, from Mikhail Khodorkovsky’s Yukos oil company to, earlier this year, the RBC media group, which had the temerity to investigate Putin’s friends and family.

So companies are sitting on cash, investment is down and local producers have failed to expand despite the help of a ruble devaluation and a ban on many Western imports. Economic growth is expected to stay below 2 percent for years to come, far short of the 5 percent-plus pace seen in the 2000s.

To generate ideas, Putin has created a council of economists who agree on one thing: Russia cannot prosper without reforms aimed at strengthening property rights and easing the bureaucratic burdens on business. This would require, for example, creating a truly independent judiciary and sharply reducing the number of entities that have the power to inspect and fine.

But reforming the economy requires fixing the political system as well. If Russia is to have an impartial justice system, then the Kremlin elite can’t trump up charges against perceived enemies or take assets away from supporters of the opposition. And if the opposition can’t so easily be silenced, Putin may have to submit to more competitive elections.

It’s extremely hard to imagine that Putin would consider such a change. Yet if he wants to address an economic malaise that could ultimately threaten to topple him, that is precisely what he must do.