Is Russia a Kleptocracy?

Is Russia a Kleptocracy?

Thomas Riggins

A kleptocracy is defined in the Merriam-Webster dictionary as "government by those who seek chiefly status and personal gain at the expense of the governed." Many anti-Russian commentators today have no problem with classifying Vladamir Putin's government as kleptocratic but Richard Sakwa, a Russian expert at the University of Kent, is not one of them. He gives his reasons in "Grey - area Gold," an analysis of Putin's Keleptocracy: Who Owns Russia a book by Karen Dawisha, published in the TLS of February 6, 2015. What follows are some comments and observations on Sakwa's article. I have italicized my own views to avoid confusion.

Dawisha obviously thinks Russia is a kleptocracy. She paints a picture of rampant corruption and abuse of power by those involved in the overthrow of soviet power and the transfer of the collective wealth and property of the soviet people into the hands of private individuals. The security forces of the soviet state played a major role in this betrayal. Sakwa says her arguments are so "incendiary" that Cambridge University Press backed off from publishing the book and it cannot be bought in the UK. It is available in the US from Simon and Schuster.

"The fundamental picture that emerges," Sakwa writes, "is of a Russia that has been hijacked by an elite that quite consciously set out from the beginning of its rule to increase its wealth, and needed to take over full political control to safeguard this process." In Marxist terms this would have been a counter-revolution led by elements of the leadership in collusion with the state security apparatus. However, it does not account for the acquiescence of the Red Army nor the passivity of the soviet people.

Dawisha's picture shows that Putin and his circle have certainly taken advantage of the end of soviet power and have enriched themselves at the expense of the general population (''behaviour typical of nouveaux riches throughout the ages") and have supported acts of corruption but her analysis also results "in obscuring complexity and counter trends."

That is to say, Sakwa contends, there is more to Putin's Russia than just the kleptocractic features Dawisha highlights. When then bigger picture is taken into consideration Russia turns out to be, while having some of the kleptocratic features found in many other countries [including the United States ] "not a kleptocracy tout court."

This is because the Putin government plays a much bigger role than just the enrichment of its elite supporters. It maintains social peace at home and is active on the world stage supporting Russian interests and "meets the basic needs of the Russian people" by furthering a "dirigiste" model of capitalism. Instead of hiding its revenues overseas the Russian government invests its tax money and oil revenues in public works projects and investments "for a rainy day."

That day is here, Sakwa says. Since Russia is being run in the interests of the Russians rather than the Germans or Americans this has caused the "west" to over react and initiate policies against Russia with which the Russians cannot possibly  comply. One of these is the "sanctions" regime imposed on "Putin's cronies" (and now the threat of direct involvement in the Ukrainian civil war by arming the Kiev regime). These will have no effect on the Putin leadership but are now "affecting the whole population in a form of collective punishment". As could have been expected (If Obama and the American leadership knew anything about the real history and sentiments of the Russians) these ham fisted reactions have only increased Putin's popularity at home and "the people have rallied around the flag." The US is on a collision course of its own choosing with Russia.

Sakwa lists four reasons why Dawsha’s book as well as the so-called liberal domestic opposition to Putin (and the Western supporters of anti-Putinism allied with them) should not be taken at face value. They are:

1.) The portrait of Putin presented “is often circumstantial, conjectural,

      and partial.” Do we really want to base our foreign policy on this

      kind of evidence?

2.) There is evidence of a “deep state” at work in Russia [we have one 

     too] made up of sections of the military and security operatives (the          

     “siloviki or (‘force-men’)” and “former Party resources” but the 

     evidence given does not prove that it functions simply as a force 

     for “kleptocracy.” It has been used against the Russian “mafia” and

     for the creation of state owned enterprises which “struggle to 

     achieve at least a modicum of good corporate governance.” 

     Western sanctions actually thwart the forces that are trying to

     integrate Russia into the international system.

3.) Unlike what is to be expected from kleptomaniacs, the Putin 

     government has “delivered significant public goods” and supported

     “neoclassical liberal nostrums.” Russia followed policies that allowed

      it to get through the  2008-09 world economic downturn and has 

      since begun “to invest in some major infrastructural projects". All

      in all we see “a developmental dynamic” which “does not look like 

      the policies of a kleptocracy” but, Sakwa says, the country might 

      have been in even better shape without the elite skimming off  

      social wealth for itself (this includes Putin) and “the misguided 

      dirigisme.” [Since the alternative to “dirigisme” is unregulated

      privatization I can’t agree with this last suggestion.]

4.) Russian foreign policy is not conducted on the basis of what is good 

      for kleptocrats but rather on the vision that Russia is a “great  

      “power and should be “an equal partner of the West.” Needless to   

       say “the West” [ i.e., basically the  US ] doesn’t want to accord  to

       Russia “equality.” [Russia is treated as a second rate power that

       must comply with US dictates. The Ukraine is a test case and the

       Russians must be seen to give in to American demands. This 

       fully accords with the dynamic of inter-imperialist rivalry  which has   

       come to the fore since the collapse of the Soviet Union and has 

       been so well described by Lenin in his work on “Imperialism the

       Highest Stage of Capitalism.” American “over-reach” here could 

       result in Obama’s policies leading to an unprecedented flare up of

       violence and destruction on a continental scale, or worse.]

In concluding his review, Sakwa says Dawisha’s book “is one of many books that contribute to a misleading paradigm of how Russia actually works.” The reality is more complex. Dawisha’s book will give you a good insight into the elite and how their wealth was acquired but there is much more going on in Putin’s Russia than you will find in this book, so “when it comes to shaping policy towards Russia, it is a deeply deceptive guide.” Well, it seems this is not the book to read if you really want the dope on what’s going on in Russia. I will nose around and try to to find a better guide to post to this blog.