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The Russia Journal
January 17-23, 2003
Desperately seeking Russia's middle class
By Peter Lavelle
(The first in a two-part series reflecting on the concept of the middle class in Russia.)

I have been amazed and amused for quite a while now watching pundits throw around the term "middle class" when talking about Russia. Well, it took a U.S. government Web site reporting on the term (Radio Free Europe/Radio Liberty) to finally force my hand to write a few thoughts down on this reified and bastardized concept. This country does not have a middle class in any meaningful sense -- not yet, at least. For this to happen, Russia's reform project needs to be seriously reassessed.

With the rise of what is often called the "emerging markets" and the economic transformation of the post-communist world in general, the term "middle class" has lost most of its meaning. Economists are divided as to how to characterize it. Should this concept be seen through the prism of income, or other social characteristics? If we use just income as an indicator, a "middle class" can be found in just about every society. When looking for a middle class as another social group, something very different may be found.

Though defining the middle class is difficult today, that has not always been the case. Historically, it has meant something like this: In Western Europe in the 18th century, the term "middle ranks" was used increasingly to express the notion of an expanding section of society composed neither of nobility nor of commoners, and, by the 19th century, "middle class" was widely used as a self-congratulatory expression by those to whom it was applied.

In current professional, sociological and political-science usage, the expression does not designate so much a class as a large, fluid status group, characterized most of all by its extent and flexibility, the relative effortlessness with which someone can join it and the great difficulty of leaving it (upward, at any rate). This is basically the Western model of and experience with the middle class, not post-communist Russia's. A "survival index" would be a better yardstick with which to measure and define groups within Russia's population.

The problem with applying class terminology to today's Russia is that it is all too often economically determined and, to some degree, politically motivated. Class is not only a financial-economic category, and those who believe it is are nothing more than Marxists of the cruder sort (whether or not they are aware of it) or just plain ignorant of economics, sociology and history. Defining Russia's middle class in terms of income and/or disposable income is a poor man's way of understanding the concept. It is also another habit that makes "getting Russia wrong" easy. It would be far more prudent to analyze the social group(s) that might one day become the foundation of the middle class in a much richer sense. (This will be discussed in detail in next week's column.)

The so-called "Russian middle class" is in fact a status group that has, as of yet, hardly embedded itself in society. The concept of class is still in the making in Russia -- but there are a number of status groups that may eventually become the building blocks of a class-based society. Class is a a matter of self-identity -- and the idea of identity remains in short supply in this country. To make some order out of this state of affairs, it will be useful to return to some ideas about political economy most pundits have never heard of.

The all-but-forgotten early 20th-century economist Thorstein Veblen preferred not to analyze the difference between social groups based on income, but by the use of ideas like "staples of decency" and "relative economic deprivation." Both concepts tell us about consumption patterns and how consumers want to define themselves within the economy. Veblen did not particularly care how individuals earned their income, but what they spent it on. This behavior is a very germane indicator when analyzing a developing economy.

A "staple of decency" in a contemporary Russia context is, for example, the mobile telephone. Possession of a mobile telephone is just as much a practical necessity for some as it is a symbol of status for many. It does not designate a class distinction; it is an indicator of aspiration. It could be considered a form of conspicuous consumption, but conspicuous consumption can and should be defined in different ways. For some consumers, it is a way to demonstrate that they have excess disposable income. For others -- for many, in fact -- it is a way of attempting to blur their income status by appearing to be among the affluent or "middle class."

Staples of decency are psychological expressions of aspiration; their social significance defines status, not necessarily real income. This is where the concept of relative economic deprivation comes into play. The middle classes of developed economies may live beyond their means because of a well-developed credit system, but in Russia, where such a thing does not exist, consumers make financial decisions based more on the desire to project status than on what they can really afford. Many in Russia-s so-called "middle class" do not pay taxes, energy bills or rent. It is not paying its own way; it is a free rider on the back of an unreformed economy.

Because of Russia-s transition to an economy many continue to -- mistakenly -- call a market economy, it is not hard to mistake those who have excess income with which to enjoy life for a middle class in the Western sense. This is not the case. In fact, look a little closer, and one can easily surmise that a real middle class is not in the making either.

The second part of this series will discuss what it will take for a meaningful middle class to emerge in Russia.

(Peter Lavelle is a Moscow-based analyst and the author of "Peter Lavelle's Weekly Russia Report," available at www.russiareport.ru.)

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