#11 - JRL 7214
The Observer (UK)
June 8, 2003
President Vladimir Putin's engagement with the west continues this month when he stays at Buckingham Palace as part of a state visit. State building is a preoccupation for Britain and America, especially in Iraq. It's something that has been at the heart of Vladimir Putin's political project. By William Tompson William Tompson is an Associate Fellow of the Russia and Eurasia Programme at Chatham House and Reader in Politics, Birkbeck College, University of London.
Vladimir Putin has brought a new project to Russia: rebuilding the state. Both the victorious elites of the 1990s and their victims now share a common interest in this.
The new elite, having survived the upheavals and crises of President Boris Yeltsin's later years, wants to consolidate its position. It needs an effective state to protect its newly-won property rights and provide an environment in which it can develop the assets it has acquired.
Most ordinary Russians simply need a state capable of providing basic public goods such as law enforcement, paying budget-sector wages and pensions, and encouraging economic growth.
This is not to suggest that there is a high degree of political consensus. The elite and the public are deeply alienated from one another and divided about virtually every major question concerning the future. However, on this one very fundamental issue - the reconstitution of state authority - there is general agreement. Putin personifies the project and has made it his chief priority since coming to power.
This provides a large part of the explanation of why support for the president remains so broad and constant, despite political setbacks and disagreement with many of his policies. Observers have commented on the apparent puzzle of the president's approval ratings, which continue to defy gravity after more than three years in power.
Many of Putin's policies are unpopular with both the public and the elite, and those who profess to support the president often have nothing in common except their liking for him. He has, of course, benefited from generally favourable political and economic circumstances and from the contrast between himself and his predecessor, but Putin's standing rests on something more substantial.
His popularity reflects a broad consensus that was missing in the 1990s. This suggests that political stability may be more robust than some observers have assumed, as it depends less on Putin than the project he represents.
Unfortunately, there is no guarantee that the project will succeed. Political authority is easier to destroy than to create. What is more, agreement on the general goal does not extend to the specifics: virtually every major strand of Putin's reform agenda faces powerful opposition from entrenched interests, not least the state bureaucracy itself.
An authoritarian state?
Confusion also exists about the kind of state Russia needs. Putin publicly espouses liberal democratic values and speaks of a 'dictatorship of law', yet there is no mistaking the generally authoritarian drift of his administration in many areas. Economic policy has been largely liberal, but other strands have been decidedly illiberal.
Putin has presided over efforts to centralise power in the Kremlin at the expense of other institutions and to construct electoral and party systems more amenable to manipulation by the administration. Media freedom has been curtailed, and a brutally harsh line has been taken on Chechen separatism. The security services have been strengthened and remain largely unaccountable.
Many around the president seem to identify state building with strong, top-down leadership; a view Putin himself seems sometimes to share. Yet there are limits on the extent to which a leader, even one as dominant as Putin, can govern by command. Regional bosses in particular have proved remarkably resilient in the face of his drive to reconstruct the so-called 'vertical of power'. Only limited headway has been made in reversing the regionalisation of politics.
Consensus is not a word often applied to Russian politics. The radicalisation of former President Mikhail Gorbachev's reform process in the late 1980s opened up enormous cleavages, dividing both elites and mass publics. The break-up of the Soviet Union and the onset of market reforms merely aggravated these conflicts, many of which remain unresolved more than a decade later. Wounds inflicted on the body politic in the 1990s run deep and are yet to heal.
The chief preoccupation of the elite then was not strengthening the state but extracting resources from it. This was hardly unique to Russia. As Venelin Ganev has argued, the principal concern of post-communist elites across eastern Europe was the struggle for control of the massive wealth accumulated by the state under communism. Elites had no reason to use the state to extract resources from society, because society had little worth taking - everything of value already belonged to the state. Their dominant project was not to use the state to pursue national or class interests, but to plunder it.
There were, of course, good economic arguments for the shift to private ownership and private enterprise, and the architects of the transition did not intend or anticipate that it would involve so much corruption and plunder. However, the state, already weak at the start of the 1990s, was incapable of managing privatisation in an orderly fashion. The elite had little reason to want a more orderly, transparent process, since its interest was in asset-stripping as quickly and cheaply as possible. On the contrary, the elite had good reason to weaken state institutions, and popular demands for more effective governance went unheeded.
The elite's preoccupation with 'stealing the state', to use Steven Solnick's memorable phrase, helps explain why, despite the erosion of state authority, Russia did not suffer large-scale social unrest in the 1990s. The 'theft' taking place was mammoth in scale but indirect. It therefore aroused much indignation but little active resistance.
Protest occurred, for the most part, when people felt that the authorities were robbing them. Thus the coalminers shut down the railways to protest wage arrears, but there were no great public disturbances when a small group of financiers took over choice industrial assets in the shares for loans auctions of 1995-97. Ordinary Russians had no doubt that a scam had been perpetrated, but few felt they had been robbed themselves, so few did anything about it.
When protest did occur, the authorities tended to opt for appeasement rather than repression, which helped to prevent escalation into a social explosion. Appeasement was preferred largely because it was cheap. The demands of miners, budget-sector workers and pensioners for timely payment of their - in any case inadequate - wages were hardly comparable to the privatisation stakes being contested by the elite.
There are a number of dimensions to the present state-building project. The first is the recovery of the state's extractive capacities. Here, there has been a dramatic turnaround, as chronic fiscal crisis has given way to budget surpluses, enabling the state to raise - and pay - budget-sector wages and pensions, and to meet other financial obligations.
Fiscal consolidation has probably contributed more than any other single factor to restoring the authority and legitimacy of the formerly bankrupt state. Exceptionally favourable economic circumstances account for much of this improvement, but so also do better expenditure management, the reform of tax legislation and more efficient administration.
The state's rule-making capacity has also grown markedly. Unlike Yeltsin, Putin has a compliant parliament and presides over a government that, for all its internal divisions, is not riven by the factional conflicts that marked the 1990s. The result has been a flood of new legislation, much of it directly concerned with state reconstruction.
A great deal of this is aimed at civilising the business environment and improving property right protection. Significantly, its aim seems to be the protection of what David Woodruff calls the 'particular conflation of ownership and control' that emerged in companies in the Yeltsin era, rather than property rights per se. The new legislation is being used to entrench the positions of those who prevailed in the post-1992 scramble for assets.
The impact of these changes cannot be taken for granted, for there has been rather less progress with the state's rule-enforcement powers. Doubts persist about the independence, competence and probity of the courts, prosecutors and police. The overhaul of the Code of Criminal Procedure has given new rights to defendants, at least on paper, but judges, prosecutors and police are reluctant to change their behaviour.
In the business world, physical force, though less common than in the 1990s, is still employed with disturbing frequency in commercial conflicts, especially when the stakes are high. Often, this involves the use of state bodies as the servants of private interests - a disturbing reminder of the extent to which private interests continue to penetrate state institutions at all levels. While Putin has managed to redefine the terms of his relationship with the country's so-called oligarchs, he has had less success in increasing the relative autonomy of the state: many state bodies remain closely aligned with, or even captive to, particular private interests.
These weaknesses affect the state's administrative capacity as well. The state bureaucracy is large, unresponsive and riddled with corruption. Russia may have a weak state but it has strong bureaucrats: individual officials often dispense tremendous patronage and have extremely wide discretionary powers, which they often use for private gain at state expense. On the first anniversary of his election, Putin told a group of journalists that the biggest lesson he had learned was that 'it's very hard to fight with the bureaucracy.'
Seemingly unable to change bureaucrats' behaviour, Putin opted to deprive them of some of their powers: the de-bureaucratisation legislation of 2001/02 did much to curb their discretionary authority and, to judge from recent survey evidence, has reduced corruption. But this is only a partial solution. Administrative reform is only just getting under way and will take years to bear fruit. In the meantime, the government's capacity to implement its policies at street level will remain limited.
Finally, what of the state's political capacity, its strategies for securing society's compliance with its rules? Rule enforcement is only part of the picture: state compliance strategies usually involve a mix of remunerative, normative and coercive elements. Greater reliance on normative strategies is possible only where the state is seen by its subjects as legitimate - where citizens obey not only because they desire rewards or fear punishments, but also because they believe they ought to do so. Here, too, little seems to have been achieved.
The present political regime probably enjoys more legitimacy than in the 1990s, if only because citizens appreciate both political stability and economic recovery; they also believe that Putin has enhanced Russia's international standing. Nevertheless, polls suggest that while ordinary Russians broadly approve his performance, there is a great deal of cynicism about the political process and very little trust in state institutions. Politics is still seen as a game played by the elite, for the elite, and the state has little inclination or capacity to improve the lives of ordinary people.
Post-Yeltsin state building has thus been decidedly uneven and fraught with conflict. Nevertheless, it is likely to remain the dominant project of Russia's elite for some years. As Bobo Lo argued in The World Today in March: 'Putin is a leader of consensus. He prefers to operate through persuasion rather than force, but there is no mistaking who is in charge; his is the only possible consensus.'
On the face of it, Lo is simply drawing attention to the extent to which the president's dominance enables him to define the terms of political debate, but the words bear a secondary meaning, one that is no less valid: the state-building project that Putin exemplifies is truly the only possible basis for a political consensus in a deeply divided Russia.
About The World Today essay This article is published in the June 2003 issue of The World Today, published by the Royal Institute of International Affairs at Chatham House. An essay from The World Today is published online in Observer Worldview each month.