Date: Sun, 19 Mar 2006
From: Vlad Ivanenko <ivanenko60@yahoo.com>
Subject: Two views on democracy in Russia
The recent article by Alan Philps "In search of Russia's middle class" (The Daily Telegraph (UK), March 18, 2006) [JRL#67] has highlighted a curious divergence of private interests in Russia that helps to explain why Putin is generally popular but, also, why staunch minority opposition persist. By the way of example, Philps introduces two opposing characte! rs. A protagonist (female manager) of Putin is appreciative because of economic stability that has allowed her to become relatively prosperous. An antagonist (male journalist) hates Putin whom he blames for losing professional significance. He claims that as people move into organizing their economic lives, they become apolitical.
Apart from highlighting the opposite interests of these who wish to “live well” (arranging the personal space) against those who long for “living in interesting times” (engaging in “creative destruction”), this example is symptomatic of sea change in Russian approach to democracy. I argue that the new phase of democracy building, however embryonic, is based on a more solid foundation. Let me postulate stylized facts before expounding on this assertion
1) Individually, Russians increase their personal well-being. People have got used working in several places, which amount to diversification of ! one’s income. They invest increasingly in real estate, long-term renovations and durables implying that they have longer time horizon and are more confident in their future. Responding to growing consumer demand, retail and personal service sectors expand rapidly, albeit their structure is still brittle (as evidenced by the recent run on basic commodities). Banking sector moves into expanding consumer credit;
2) Unlike individual space, public infrastructure continues to decay. A spat of recent accidents (collapsing roofs, a subway break, electricity blackout) indicates that bureaucracy is not ready to face the challenge. Monopoly on power by United (Bureaucratic) Russia appears to be the main hope of public servants to be absolved from responsibility for further technologic catastrophes in public sector;
3) Big businesses play the passive role of observers in national policy making. For example, Alekperov has recently w! arned that Russia will develop crisis in oil processing sector in three years because it has obsolete facilities (the last oil processing plant was built in Russia in 1982). Alekperov declines to comment on why his own company Lukoil does not invest the downstream. Most likely, the big business is convinced that it does not pay to mess with politics for private interest. Current approach is short-term: businesses choose to stay ready for cashing out in time of trouble;
4) Former opposition figures witness their stars declining. The slogan of revolutionary changes does not appeal to the median voter. There is general political apathy. Critical of authorities papers are not considered to be worth reading. At the same time, there is a revival of interest in general social achievements (sport, culture, science) indicates that intellectuals have remained the potential to come back to politics.
Based on the dynamics descri! bed in the stylized facts, one should observe that fact (1) and, possibly, fact (3) are in contradiction with fact (2). As individuals will have organized their personal space, they must start looking on public places. One cannot make an expensive renovation in a private apartment without extending his/her sight to the sorrow state of building where s/he lives. The greater is the number of cars, the more attention is paid to road quality and the treatment that drivers get from the traffic police. As more people’s income depends on good operation of their workplace, they demand better quality of utilities and its breakdowns are not going to be tolerated. These developments suggest that public oversight over civic servants is going to progressively improve over time.
Interestingly, the United Russia attempts to mimic Putin’s success by going against individual bureaucrats (e.g. it has unexpectedly supported the political action in defense of Scherbinsky,! the driver who was sentenced for reckless driving in the accident that had the former Altai governor killed) indicates that a bureaucrat cannot be assured of being indulged of wrongdoing if s/he expresses loyalty to the party of power. Thus, the main line of autocratic defense (monopoly on power) has the potential of becoming quasi-democratic. It sets the average standard of “decent” behavior that bureaucrats are pushed to raise competing against one another.
The big business’s unwillingness to engage in national projects (apart from state-owned corporations) speaks volumes about poor relationship between state authorities and private sector. However, the state needs private sector’s entrepreneurship. Bureaucrats are extremely uncomfortable to take responsibility for economic affairs. By the force of internal competition (driven by voters’ pressure), they are destined to engage somebody else in economic development. National projects can be seen as ! trial balloons for a new framework of partnership between the state and big business. State attempts at creating national mega-corporations is another experiment in this direction. The message is clear. The state is ready to give money (or tax breaks) and to throw its weight promoting national business abroad, if the latter recognizes its Russian national identity (and abandons emergency plans prepared for speedy immigration a la Berezovsky style).
I conclude that the current situation combines two opposite processes that mask their actual dimensions because of superimposition. Pressure from voters (1) and, potentially, but less visible from big businesses (3) grows on bureaucrats (2) who are requested to contain their power “voluntarily”. This development is pro-democratic. However, the old opposition parties together with the previous concepts of the freedom of speech (bordering on slander) and common “volya” (understood as freedom from self-restraint) die out. The decline of “old” democratic tradition proceeds faster than the first process and this creates the overall impression of “democratic decline” in Russia.
Vlad Ivanenko, PhD economics
Ottawa.