Posted on September 9, 2010 - by Venik

Russia: Power to the powerful | Editorial

The Russian plutocrats have no interest in changing a system on which they thrive

In an off-the-record briefing to a visiting group of foreign academics and journalists this week, a senior official of the Russian government spoke in tones verging on contempt about the victims of the forest fires that ravaged central Russia this summer. He argued that there had never been a proper fire service in the forests around Moscow and that everyone who lived there knew it. For every hero in the fire service who sacrificed his life for others, there were a hundred others who never pitched up. But rather than accept the collective responsibility for failing as a government to organise a functioning fire service, he drew the opposite conclusion. He said it was up to each owner to have their own fire bucket. Why should the state help those who could not, or would not, help themselves? The narod are mugs.

As chilling as these comments are, they nevertheless represent an attitude prevalent in the elite around Vladimir Putin who run Russia. Some are now people of considerable wealth, as proximity to power is profitable. While paying lip service in public to the corruption of bureaucrats and the deindustrialisation of an economy dangerously dependent on the price of oil and gas, they themselves do little in practice to stop either. What interest would they have in changing a system on which they thrive? The modernisation of which they speak is about means, not ends. It is about implanting progress from above, dropping a Russian Silicon Valley on to the forests of Skolkovo (when there are cities with strong scientific centres languishing through lack of investment) or building an international ski resort above the subtropical city of Sochi. God forbid that economic liberalisation should lead to political change, the creation of real political parties, a functioning civil society, and institutions independent of the governing elite. There is no exact equivalent in English of Putin’s “soft autocracy”, and that may be telling in itself. Even benign despotism implies a will to improve the lives of ordinary people.

Russia itself is languishing. Its economy contracted by nearly 8% last year, its worst annual economic performance since 1994, and – despite being so dependent on the stuff – it is producing less oil now than the Soviet Union did in the 1970s. Soviet oil accounted for 35% of global production in 1985. Oil from Russia accounts today for just 17% – a marked decline even after the partial loss of oil from the Caspian basin is factored in. Russia’s economy has shrunk twice in the last decade, and deindustrialisation is making itself felt in Russia’s mono-cities – those reliant on a single industry. It is against this background that the billions of dollars thrown at baubles like Skolkovo and Sochi should be judged.

Speaking in Sochi this week, Mr Putin made little secret of his dislike of elected local officials. He even described how one of them did a bunk through the back door rather than face popular wrath after one disaster. The implication is that Russia is not ready for democracy and the system of Kremlin-appointed bureaucrats is here to stay for some time to come. In a conference in Yaroslavl today, President Dmitry Medvedev will attempt to claw back some of the limelight lost to his senior partner in recent months. The president’s speeches often include strident criticisms of the political system of which he is an intrinsic part. Two and a half years into his term of office, Russian liberals wait in vain for the president’s cavalry to arrive. By all accounts, it has yet to be formed. In judging the balance of power between Mr Putin and Mr Medvedev, the former wins hands down even though, on paper, he has fewer powers.

Michael McFaul, President Barack Obama’s top adviser on Russia, argued yesterday that, historically, autocracies have been less instrumental than democracies in economic modernisation. He is right, but the greater threat Russia faces is stagnation, under the grip of an elite increasingly unwilling to share the spoils of power.

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