Novosibirsk, Russia - Russia's May 9 Victory Day was marked this year with more than normal fanfare and a massive show of military hardware rolling through Red Square--the first such display of weaponry on this holiday since the end of the Soviet empire. Standing on a special platform to review the parade--in front of a Lenin's tomb covered in bunting and Russian flags--were newly inaugurated president, Dmitri Medvedev, and his predecessor, and now prime minister, Vladimir Putin.

Since the fall of the Soviet Union the traditional Communist celebrations have faded. But May 9 continues to have historic resonance for the Russian people. Soviet losses in the war against Nazi Germany were between 20 and 30 million, the country's industrial base and infrastructure were left in ruins, and the nation was nearly bankrupt. It took decades to recover from the wholesale destruction.

Still, the 63rd anniversary is not a kruglaya data, as the Russians refer to nice, round-numbered 40, 50, or 60-year anniversaries, so no special celebration would seem to have been warranted this year, much less tanks, armored personnel carriers, and mobile ballistic missile launchers rolling through the streets.

The reasons for such a grand public spectacle were twofold. One was that Medvedev had been inaugurated only two days before on May 7, so the military show was a way of signifying the transfer of power to the new president and a demonstration that Russia remains a strong and united nation.

The other, more significant motivation was the culmination of the Putin regime's years-long crusade to send a message to the world that Moscow is once again a great military power--that it intends to challenge the West at every possible juncture.

This military posturing has manifested itself in a number of ways. Russian strategic bombers have begun flying patrols near NATO airspace again, for the first time since the end of the Cold War. In early February, a Russian bomber patrol buzzed a U.S. carrier battle group in the Pacific--violating Japanese airspace in the process. During April's NATO summit, Putin reportedly threw a temper tantrum and threatened that he would cause Ukraine to "cease to exist as a state" should the former Soviet republic attempt to join NATO. Russia's Kommersant newspaper, quoting a diplomat who witnessed the spectacle, reported that Putin threatened to encourage the secession of the Black Sea peninsula of Crimea and eastern Ukraine, areas where the population are pro-Moscow.

The story is easy to believe because Putin threatened far worse earlier in the year. In a joint press conference with Ukrainian president Viktor Yushchenko in February, Putin threatened his neighbor with nuclear annihilation if it allowed NATO to establish bases there. "It is frightening not only to talk about this, but even to think that, in response to such [NATO] deployments ... and one can't theoretically exclude these deployments, Russia would have to point its warheads at Ukraine," he said.

But for all of the bluster, Russia's military hardware is aging and decaying before our eyes, whether it is chugging through Red Square or flying at 2,000 feet above a U.S. carrier's flight deck. Defense attachés and intelligence officers assigned to Moscow used to live for these military parades, which sometimes gave them a chance for a first glimpse of some new weapon system. But there was certainly nothing to get excited about in the latest parade.

"If they wish to take out their old equipment and take it for a spin, and check it out, they're more than welcome to do so," said Pentagon spokesman Geoff Morrell at a press conference. Russian military observers were even more dismissive. "Our armed forces today are merely a bad copy of the Soviet Army," said retired General Vladimir Dvorkin in an interview with the Associated Press.

The steep decline of the Russian military began in the 1990s when orders for Russia's defense screeched to a halt during the Yeltsin era. But the "happy days are here again" era of $100 per barrel oil under Putin has not brought a cornucopia of new orders from the Russian ministry of defense. Procurement of new fighters and other systems has been anemic; most of the budget allocated for aerospace R&D has been diverted from military projects to the development of the Sukhoi Superjet 100, a regional passenger airliner. Meanwhile the Tupolev Tu-95s that were sent to buzz the Nimitz battle group in the Pacific are a design that is more than 50 years old.

Most weapons systems in the Russian arsenal today are warmed over versions of designs that were made in the Soviet period. Remarkably few innovations have been turned out since then, and almost none that are anywhere close to production status. This is a direct result of Moscow--despite all of its new-found wealth--turning off the investment spigot to the R&D centers of the defense industry.

Under Yeltsin the drying up of R&D funding was arguably a case of benign neglect, but under Putin--and now Medvedev--the state seems strangely determined to starve its defense industry, perhaps because it is not a power center for Putin and his St. Petersburg cronies.

One of Russia's premier institutions of scientific excellence is the Siberia Aeronautical Research Institute (SibNIA) in Novosibirsk. A discussion with the senior staff there tells the tale. "Our yearly budget is about 400 million rubles [$17 million], but of this sum we only receive 20 million rubles--5 percent--from the government," a SibNIA official tells me. "The rest we have to go find ourselves by doing work for foreign customers or commercial projects like the Superjet. If the government wanted defense and aerospace technology to really advance in this country we and other institutes like ours would be fully state-funded as NASA is in the United States, and we would not be knocking on doors all the time with a tin cup in one hand."

But Moscow's failure to invest is only part of the story. The senior officials appointed by Putin now want to kick all of Russia's designers and engineers out of their design bureaus and institutes in Moscow and move them out to a new national design center in the city of Zhukovsky, which is some 25 miles from the far southeast edge of Moscow.

The official rationale for this move is that it places all of these experienced personnel into one facility and thereby creates synergism. A better explanation is that Putin's cronies want the land these defense facilities sit on in central Moscow, which is worth untold millions to real estate developers.

This is a move that will kill off what remains of Russia's defense industrial base. Most of the personnel still working at these design centers are pushing 60 or more. "None of these people will make the move all the way out to Zhukovsky," says one of the SibNIA senior researchers. "Most of them would rather retire than submit to a two-hour--each direction--commute every day across the whole of Moscow.

No one in Moscow officialdom seems particularly bothered by the collateral damage from this real estate scam. All they care about is how much money they are going to be able to stuff in their pockets. The fact that there may soon be no one left to build the weapons the Russian military needs is at most a minor inconvenience.