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A simple public choice theory of Russia
This one is crude, but it cannot be dismissed:
Putin doesn't run a country, he runs a corporation. He is the ugliest mixture of Karl Marx and Adam Smith. He is not interested in restoring the Russian influence, he's just interested in Gazprom's and Rosneft's influence. Actually, Putin is destroying the Russian state. If we look at the functions of the state, they are gradually transferred to the state companies: now the Duma voted that Gazprom and Rosneft can have its own armies. These so-called state companies are run by Putin and his KGB-buddies - him being a sort of "capo di tutti capi". And for those doing business with KGB Inc., I remind them that the KGB shareholders are very active shareholders.
That's Garry Kasparov, here is one commentator summarizing:
In Kasparov's view, the main goal of Russian foreign policy is to raise the oil price, no matter what - that's why the tensions in the Middle East are so important to Putin...
We live in a nice world, no? Megan McArdle ponders life or death incentives in the former Soviet Union. Here is the excellent New Yorker article on Kasparov.
Posted by Tyler Cowen on September 27, 2007 at 07:15 AM in Political Science | Permalink
Comments
This expalanation seems correct to me when coupled with the fact that Putin won't/can't be re-elected as President. KGB Inc is playing with fire and only way to stop lightning falling on their heads is to have some grip over the political machinery when they don't directly control the political machinery in the future so as to prevent future recriminations over thier activies in the present.
The Russian people however couldn't care less as long as there is a semblance of stability, a steady drumbeat of nationalism and rising living standards afforded by an investment boom driven mainly by macro stability which in turn is anchored by oil exports. When the oil price finaly collapses 5, 10, 15? years from now Russia will have a much higher standard of living but severe social inequities.
Posted by: sa at Sep 27, 2007 8:33:31 AM
I think that Mr Kasparov's analysis of current events should be put in context of his views of human history. He is a supporter of the New Chronology sect. He published articles claiming, for example, that human history before XVII century is a complete falsification, that Jerusalem, Rome, and Istambul are the same city, and that Friedrich Barbarossa, russian count Jaroslav, and mongol khan Batyj are the same person. For some reason, none of this is mentioned by New Yorker.
Posted by: Tomash at Sep 27, 2007 8:53:05 AM
From within inside it looks really strange sometimes. For example, pro Putin organizations promote writing of Parshev, a man who wrote books on such topics as "why russia is not america" - and do you know why - because of harsh climate. To cure problem the man recommended to close country like North Korea ( or harsh. Another book of this person - 'why America concurs others' ( the book was written before Iraq war ) and the answer was - because there will be an end for oil and America pursue goal to have a safe oil in future. BTW Parshev is ex KGB man too and he respected as 'patriot' who argues for rule of 'right nation oriented persons' ( though dreaming to make a country like North Korea could hardly have something related to patriotism).
but also they promote idea to increase of foreign investments.
Together it looks like pure schizophrenia and also hints - the state rules have so strange goals, so that they not even attempt to develop clean explanations for their steps.
For my opinion the biggest problem is lack of foreign language skills for most of population, and thus ( with government controlled TV and most radio stations ) Putin and Co could relatively easily promote their ill ideas.
Kasparov wrong in goals in respect to oil prices. Kremlin claims that optimal price would be $45 per barrel and seems this are sincere words.
But I would rather support him in his idea to offer simple explanations for general public which could stir problems for Putin.
Posted by: Sergey Kurdakov at Sep 27, 2007 9:15:25 AM
I pretty much agree. I was just in Russia just three weeks ago, and the transformation from the communist era is amazing. Saint Petersburg looks pretty much like a lot of other European cities, with plenty of expensive shops and restaurants, lots of foreign cars on the streets, and real traffic jams. I hear that out in the provinces things are not so nice, but I didn't have a chance to see for myself. I speak the language passably, but I was surprised by the number of Russians who wanted to practice their English with me, even if we could have obviously communicated better in Russian. Most seemed to like Putin - he is obviously more popular than George II is with Americans. Communism is gone for goos - except for some elderly pensioners, no body wants to go back to the bad old days. Yet this seems to be so more for economic than philosophical reasons. Most Russians are extremely proud of their country, A sentiment which I admire, yet there is really no tradition of democracy, rule of law, personal liberty, independent judiciary, etc. These concepts draw lip service but seem essentially foreign to most of the Russians with whom I spoke. Most also recognize that the lands lost in the breakup of the USSR are probably gone forever - in the case of the Central Asian Muslim republics, good riddance, and in the case of republics such as the Baltic nations, Georgia and Armenia, less so. Most Russians have little idea of the depth of anti-Russian feelings in these areas, some of which I have visited, and in the former satellite countries of Eastern Europe, many of which I have visited as well. The people there mostly despise the Russians and look to NATO and the EU to help keep them out. Aside from lining his friends' pockets, Putin seems to be using much of his oil and gas revenue to rebuild the decrepit military, but this is not really so bad, given the Islamic threat from the south. A few little demonstrations against former NATO rival may be expected, but these will be mainly for domestic consumption and won't really amount to much. Russia will not be a threat to anyone, and, with militant Islam on its southern borders, a strong, prosperous Russia is probably in everyone's interest. Russia will be capitalist, sort of, but don't expect real democracy, at least not for a generation or two.
Posted by: Ned at Sep 27, 2007 11:53:04 AM
Kasparov is basically a very intelligent nut, Russian answer to Bobby Fischer. Tomash mentioned his strange views of history. If oil prices were low, he would explain that KGB worked hard to push them down for their benefit (I have no idea how he would explain it).
Parshev main idea was that climate influenced Russian history. In this he is probably similar to Jared Diamond. But he is taking this idea way too far. He is certainly not very influential. Yes, some pro-Putin groups promote him, but some anti-Putin groups promote him too and most ignore him.
> Together it looks like pure schizophrenia and also hints
Sergey, this is obvious: there are a lot of players in Russia, many of them have different and conflicting goals. The only way to avoid appearance of schizophrenia is to clamp down like in Stalin times. Is not US schizophrenic from outside?
Just for the record -- I am mildly pro-Putin. He did an Ok (alas, not excellent job) in last 8 years.
> But I would rather support him in his idea to offer simple explanations for general public which could stir problems for Putin.
This seems irresponsible to me. Down with Putin whatever the cost and it is Ok to lie to public for this lofty goal. Another replay of 1917 would not be beneficial.
Posted by: Alexey Goldin at Sep 27, 2007 11:53:49 AM
I pretty much agree. I was just in Russia just three weeks ago, and the transformation from the communist era is amazing. Saint Petersburg looks pretty much like a lot of other European cities, with plenty of expensive shops and restaurants, lots of foreign cars on the streets, and real traffic jams. I hear that out in the provinces things are not so nice, but I didn't have a chance to see for myself. I speak the language passably, but I was surprised by the number of Russians who wanted to practice their English with me, even if we could have obviously communicated better in Russian. Most seemed to like Putin - he is obviously more popular than George II is with Americans. Communism is gone for goos - except for some elderly pensioners, no body wants to go back to the bad old days. Yet this seems to be so more for economic than philosophical reasons. Most Russians are extremely proud of their country, A sentiment which I admire, yet there is really no tradition of democracy, rule of law, personal liberty, independent judiciary, etc. These concepts draw lip service but seem essentially foreign to most of the Russians with whom I spoke. Most also recognize that the lands lost in the breakup of the USSR are probably gone forever - in the case of the Central Asian Muslim republics, good riddance, and in the case of republics such as the Baltic nations, Georgia and Armenia, less so. Most Russians have little idea of the depth of anti-Russian feelings in these areas, some of which I have visited, and in the former satellite countries of Eastern Europe, many of which I have visited as well. The people there mostly despise the Russians and look to NATO and the EU to help keep them out. Aside from lining his friends' pockets, Putin seems to be using much of his oil and gas revenue to rebuild the decrepit military, but this is not really so bad, given the Islamic threat from the south. A few little demonstrations against former NATO rival may be expected, but these will be mainly for domestic consumption and won't really amount to much. Russia will not be a threat to anyone, and, with militant Islam on its southern borders, a strong, prosperous Russia is probably in everyone's interest. Russia will be capitalist, sort of, but don't expect real democracy, at least not for a generation or two.
Posted by: Ned at Sep 27, 2007 11:55:42 AM
What most people don’t know is that this happened several times on our side. I lived near a BMEWs radar system that detected a Soviet “attack” on Oct 5th, 1960. Later I interviewed an engineer who worked there (and described the false alarm as harrowing). The Soviet “attack” was actually just the moon rising over Norway. See NORAD's Canadian Deputy Commander, Roy Slemon, A Nuclear Hero and Nuclear Apocalypse Near Misses. The Jan 25, 1995 incident was particularly scary for the Russians, because the rocket (fired for research purposes) launch was just minutes from Moscow, giving them no time to determine if a war had started or not. Note that we had notified the Russians in advance of the impending launch. However, the information had not been disseminated.
Posted by: Peter Schaeffer at Sep 27, 2007 1:34:04 PM
I have also worked over there a bit and I agree with Ned. However, I think the notion of Putin as the head of a corporation is seriously misleading. Putin is a Russian nationalist down to the depths of his soul. State owned corporations are a means to the end of Russian power, influence, and prosperity (possibly in that order). Freedom and liberty as they are understood in the West rank rather low in the scheme of things. After the chaos of the Yeltsin years, most Russians tend to agree.
Russia is one more example of the emerging authoritarian state capitalist model of development. Of course, China is the foremost representative. A key question is whether regimes of this type can maintain legitimacy. So far the answer is appears to be yes.
Posted by: Peter Schaeffer at Sep 27, 2007 1:42:45 PM
sa: "When the oil price finally collapses 5, 10, 15? years from now ..."
What could bring about the collapse of the oil price? A new, scalable liquid fuel with high power density? Maybe, but that isn't going to happen in that timescale. No, Russia is going to become wealthy, perhaps one of the wealthiest nations on earth - slow development of oil fields was a problem when it happened, but now, as most nations outside the middle east have peaked, they get it back with very good interest!
If Putin's successors don't manage to stay popular, it will be though gross incompetence only.
---
You know, the mess in Russia is partly your fault - I'm speaking to you right-wing economists. It was your book Yeltsin took pages from when his economic reforms gave democracy a bad name over there.
Posted by: Harald Korneliussen at Sep 27, 2007 2:41:45 PM
> Freedom and liberty as they are understood in the West rank rather low in the scheme of things. After the chaos of the Yeltsin years, most Russians tend to agree.
I do not think things are so bad. True, the word "democracy" and "democrats" are compromised but the concepts are not necessarily so. Everyone would like to get government responsive to their needs and keep it from interfering in his affairs. Simplistically, in 1990 the government was so weak that other agents (gangsters, etc.) were interfering in everyday life more then government. I would argue that the level of everyday individual freedoms in Russia is higher now then in 1990s. What is the point of freedom to travel, for example, if you have no money for bus ticket?
I do not think you can mention Russia and China together. While China is much more liberal then in 1960-1970s, I believe Russia is currently much more free (no Internet censorship, all kinds of opposition newspapers).
You might also want to check this article by Vlad Sobell: http://www.russiaprofile.org/page.php?pageid=CDI+Russia+Profile+List&articleid=a1186589085
Since countries such as Russia and China have abandoned totalitarianism by their own volition, there is no reason to suppose that they will not equally gradually outgrow their authoritarian (or quasi authoritarian in Russia’s case) systems. It could even be argued that the West should take a leaf out of the WWW book and embrace the neo-Westphalian principles of non-interference. Ultimately, internally-grown acceptance of the need for change is more durable than change forced from outside .
Basically, I hope it will all work out Ok provided we do not get another huge disturbance like World War One and no one will try to build Iraq-style democracy in Russia (or China).
Posted by: Alexey Goldin at Sep 27, 2007 3:30:54 PM
Sergey, this is obvious: there are a lot of players in Russia, many of them have different and conflicting goals. The only way to avoid appearance of schizophrenia is to clamp down like in Stalin times. Is not US schizophrenic from outside?
no not a lot players with conflicting views. These are the same persons which promote both. Take Surkov, who created Nashi and invited there both Parshev and Sergey Kara Murza ( former communist ideologist ) and who speaks on foreign investments ( and also tell stories on how Finland wants to annexe Russian territories with Finnish population ). This is what I mean under schizophrenia including observing how lose who rubbed Russian population now claim to be their defenders ( against fictional US threats ).
Again - Kasparov is out of road, still it is very important that there are people who challenge Putin ( and Surkov ). Without this pro fascist Surkov's rethoric might deeper affect life in Russia.
Personally I dislike when uneducated ( Surkov did not have formal highter education ) devises stories on that Russians have century old unchangeable values ( while sociologist observe shift in values all over the world ).
I think that Russia will become true democracy much earlier, that it was predicted here. The reasons will be those shifts in values due to more affluent life, more information etc. But to facilitate faster move to democracy we need such strange people like Kasparov. BTW sociologist observed that fight in society facilitates it's development http://margaux.grandvinum.se/SebTest/wvs/SebTest/wvs/articles/folder_published/publication_483/files/JCS1.pdf
.
Posted by: Sergey Kurdakov at Sep 27, 2007 3:35:12 PM
Sergey, you may be right, I do not follow Surkov very carefully. No formal higher education is not a big deal, though. Bill Gates was a college dropout, Zeldovich never had formal higher education. I am PhD and I do not see what the big deal is about :-) Then again, calling "Nashi' pro-fascist is giving them too much credit. They are not that menacing.
> I think that Russia will become true democracy much earlier, that it was predicted here. The reasons will be those shifts in values due to more affluent life, more information etc.
Here I completely agree with you. Relative prosperity helps a lot.
But I do not believe creating problems for Putin just for the reason of disliking him is a good strategy in a long run. The last time this kind of strategy worked Russia lost about 80 years of time. There are valid reasons for criticizing him, making up ones like Kasparov does is completely unnecessary.
We probably should stop bothering the owner of this blog with comments that are of marginal interest to Marginal Revolution :-)
Posted by: Alexey Goldin at Sep 27, 2007 5:01:48 PM
calling "Nashi' pro-fascist is giving them too much credit. They are not that menacing.
I do not call them pro fascist it is Surkov who is fascist
http://farma-sohn.livejournal.com/57683.html . The person who writes is well known professor of philosophy, who does not disclosure his identity, but he got a response in a site run by Gleb Pavlovsky
http://www.russ.ru/politics/docs/surkov_i_fashizm
( sorry to readers for Russian language links ).
It really something special that people from Kremlin do use old fascist ideas, even taking into account whatever modern interpretations of old ideas might be.
And without Kasparov Surkov and Co might move even further. They are governed by greed and desire to make safe robbed treasures. So there should be counter balances.
Posted by: Sergey Kurdakov at Sep 28, 2007 5:27:57 AM
No internet censorship Alexei? Tell that to the people being prosecuted all over the country every week for what they write online, there has been a big crackdown in the last year or so.
I have lived in Russia since 1996 and have seen any signs of hope that it will become a normal country give way to fascism. I think westerners pay too much attention to Putin though. Russia today is not "Putin's Russia", the state reflects the general culture and that is why it is generally popular.
Posted by: jb at Sep 28, 2007 5:46:29 AM
What could bring about the collapse of the oil price?
Widespread synfuel production from coal.
Posted by: Paul Dietz at Sep 28, 2007 1:41:14 PM
By the way, a top Russian fraud investigator was just shot dead on the street in Moscow (http://www.breitbart.com/article.php?id=070928074103.94mzl2i4&show_article=1). Shows Russia still has quite a way to go to parliamentry democracy. Don't hold your breath.
Posted by: Ned at Sep 28, 2007 2:34:51 PM
Well it's pretty clear that Putin will not be able to run for president for the third time in a row so he created new and leveraged existing State corporations (like Gazprom, United Aviation Corporation, etc) to move there (with some of his KGB friends), as these corporations are now rather independent entities.
Many in Russia now believe that the 2008 elections will be won by some weak and Putin-loyal guy who will be impeachment-ed in a year or so just for Putin to come back in 2009 (now he will have the right for it — it's not three terms in a row). Given that the Parliament is severely dominated by United Russia (Putin's party), this scenario is not that unrealistic,especially combined with the above paragraph.
Why would the Russian elite eat this? Because no one there really wants Putin to leave — they all have established connections and more or less secured positions (in the government, parliament, state corporations or elsewhere). Everyone understands that the new president (even from the same party) would bring his friends to powerful positions and no one wants such a shakeup. Everyone here wants stability. Even at a cost of murders of those unloyal, radical nationalism, etc.
We're still light years away from what you mean by democracy, and we're not really heading in this direction. Bureaucracy, corruption, authoritarism is the way to go. I wasn't politically conscious in the 90-s (I was born in '87) but I just see that nothing really changes here for the better.
P. S. I hope The Economist or someone finally publishes a story covering what's going on in Sochi now that they know Olympics will be held there. Then you would definitely understand how things work here...
Posted by: Nikita at Sep 30, 2007 8:14:50 AM
I wonder whether Kasparov wants some gas pipeline to be blown up by terrorists to exaggerate to such an extent. The law Duma passed just allows to all so-called "strategic enterprises" (it's a long list, not only Gazprom and/or Rosneft, includes even research institutions, all of them handling some government or military contracts) to have internal security subdivisions armed with the very same hand weapons (namely, allowed to any civilians and private guards, i.e. not military models) that you could usually see in any bank's armored car. The activities of these subdivisions are also limited by guarding of dangerous production and research facilities. I thought a grand master could be more accurate with facts.
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