[lbo-talk] Could Russia collaspe?

Peter Lavelle untimely_thoughts at yahoo.com
Fri Jul 1 04:25:20 PDT 2005


As part of my weekly experts' project, I asked for reaction to something heard often here: Could Russia collapse.

Many replied and I will post of them on my site soon. However, Sergei Roy (editor of intelligent.ru) sent me the following:

Dear Peter,

I am not sure I am included in your round of experts, but the issue you offered for discussion is of considerable interest to me, so here goes.

For some six years I kept publishing in Moscow News weekly essays on the Perestroika years 1985-1991, eventually entitling the whole series Collapse of a Colossus. You are in fact asking now whether a collapse of the smaller colossus is likely and what will prevent it from collapsing – or whether nothing will (I am peeling off the emotionally charged terminology of your query).

Having lived through the collapse of the big, historical Russia, some Russians naturally wonder if the same can happen to their truncated country (the sense of truncation being intensified by family and other ties with 25 millions of compatriots who have found themselves, practically overnight, outside their native country). The question that logically follows is whether the forces that brought about the decline and fall of the historical Russia are still at work; and the next question is, what were those forces.

There are numerous theories about the causes of the collapse of the colossus. Perhaps the most popular one is that the Soviet Union was defeated in the Cold War because its economy could not stand up to the pressures of the arms race and collapsed, bringing down the whole country.

The way I see it, whatever strength Russia’s economy still has, is inherited from that “collapsing” Soviet economy. RAO EES began to collapse (cf. the May blackout) some 20 years after the beginning of Perestroika, as a result of vigorous application to it of capitalistic principles by Chubais the super-manager. Gazprom is still going strong, despite selling gas to Russia’s dear friends like Ukraine, Moldavia or Georgia at half the world prices or less. To listen to the media, the slapping down of YUKOS fraudsters signifies the end of the Russian oil industry; in fact, Russia has a dozen more oil companies in the same heavyweight division as YUKOS (their assets mostly dating to Soviet times) prepared to meet the needs of China, Japan, and even some of the US. The military-industrial complex, virtually destroyed after the collapse of the Soviet Union through “conversion,” is annually selling billions worth of equipment again. The space exploration industry is still put-put-putting along.

This yields two conclusions: (1) The Soviet Union’s decline and fall was not due to economic causes, or not entirely so; (2) Present-day Russia will not decline and fall for purely economic reasons, either.

So what were the causes of the collapse of the Soviet Union? There was, of course, a multiplicity of factors at work, but the principal one was, in my view, the split of the country’s political class (the elite) along ethnic fault lines and the indifference of the non-political class (of the hoi-polloi, if you wish) to the disintegration, as well as the masses’ vague hopes for better things to come – dreams of becoming as affluent as the developed countries overnight. Is the same principal factor, the centrifugal ethnic forces, at work now? To some extent, yes: 20 percent of the country’s population are Muslim, and some of their elites are daydreaming of quasi-independence or, in an extreme case, of an Islamic Caliphate stretching from the Caspian to the Black Sea, reaching deep into Russia’s territory along the Volga, linking up with Kazakhstan and thus with Greater Central Asia, etc. etc. In my view, this cat won’t jump – in either the extreme or the milder version of the dreams, for reasons political and economic. Economically, most “republics” with Islamic populations are basket cases feeding from the federal treasury to the tune of 80 per cent or so of their budgets (90 percent in the case of Dagestan). Politically, any sort of local victory of separatist forces would entail internecine strife on a Rwandan scale (cf. the Chechen incursion into Dagestan in 1999, or the current squabbles between Karachais and Circassians, with Abazins intervening – all of them Muslim). So ethnic, or religious, separatism is a lost cause, but that does not mean that it will simply go away if ignored: plenty of blood may yet be shed, drip-drip, on all sides, while separatism is kept at bay. Now, where lies the biggest threat to the unity of Russia? What are the forces that have the potential to disrupt that unity, to split the country, say, along the lines penciled in on Brzezinski’s Grand Chessboard? I have a special word for these forces: baronial. It covers both the financial-industrial oligarchs of various sizes and the regional barons – governors, presidents of the 19 ethnic republics, major criminal kingpins, all with their supporting mafias. Numerically, these forces comprise 27 dollar billionaires (3.5 times more than B.P., Before Putin) and 88,000 dollar millionaires, but that’s according to the Forbes Magazine so, knowing the nature of Russian society, one can double the figures, plus or minus lapot’ (a bast shoe), as the saying goes. And these numbers include just the top bosses, each of them relying on a power machine of his own. These forces have sprung up in the last few years – since about 1994 or 1995 – mostly through outright thievery a.k.a. privatization. Although they acted out of pure predatory instincts, they have a theory to support their ripping off of public assets – radical liberalism of the Gaidar brand which places all its hopes on the market’s “invisible hand.” Well, the first thing that that “invisible hand” did, it ripped off all of the population’s Soviet time savings. For an encore, it put the same population through the mangle of the 1998 default. We are now in the middle of yet a third, rather milder liberal project for keeping the population as downtrodden and exploited as possible – monetization of social benefits, with reform of housing and utilities looming ahead. On a more general plane, the “invisible hand” of the market has led to the population of Russia dying out at the rate of 1 million souls a year. Will this situation lead to a bloody social cataclysm, as the query implies? I may be overly optimistic, but I do not believe so. No revolt of the masses is likely in a nation that is, for one thing, dying out; and for another, needs so little to survive that it can be bought off with a fraction of the baronial incomes – through the intervention of the central bureaucracy. (Although the latter is an active player in the baronial games itself, its survival as a class, and individually, is contingent on the continued existence of the unified – even unitary – state of Russia.) And, of course, the main thing is that the said masses have no political organization that might lead them into a revolt with a glimmer of hope of success. (The Communist Party, Zhirinovsky’s party, Rodina, least of all that joke, that National Bolshevik party, are absolutely no good for this role, for reasons that it would take too long to list.) True, disturbances can be provoked by blackouts, runaway inflation, rocketing prices, all of which can be engineered by, say, oligarchic forces in and outside the country – and then it will take some skill on the part of the powers-that-be to handle these troubles. As recent “monetization” experience has shown, the government’s skills in this respect are strictly limited, and the ruckus may be considerable, but anything like the Ukrainian “orange revolution” is not on the cards at all. This brings us back to the baronial forces. The oligarchs running transnational businesses do not need a unified Russia – they’d rather deal with local duchies, which would significantly diminish their expenses for the upkeep of the local dukes who, after all, are easier bought than the whole state apparatus (Khodorkovsky made a bold bid to buy the Duma, pocketing 250 of the deputies, but ended up you know where). The usefulness of the local duchies to the oligarchs has diminished, though, since they have been more or less kicked into line by the central bureaucracy. There are notable exceptions like Tatarstan with its dominant Muslim population and a leader who is a baron in both senses, territorial and financial; closely followed by Bashkiria, Yakutia, Krasnoyarsk Territory – all these have to be closely watched for any tendency to revert to the 1990s situation, when central authority over the local dukes tended to zero. Not just watched, of course, but properly slapped down for any such tendencies. The Far East (Maritime Territory) is a prime example of what can happen if this is not done. The Center has practically lost that territory to the criminal kingpins and has as yet failed to bring it back to the fold. The gravitational field of Japan has proved much stronger and turned the Territory into a Japanese satellite: Russia annually loses some $4 billion worth of seafood illegally sold to Japan, while considerable numbers of the local population are involved in Mafia-controlled trade in secondhand Japanese cars. Along with this, there is the gravitational force of China, involving illegal sale of timber, coal etc. to China and trade in consumer goods from China, also brought in 100 percent illegally, according to sources. A virtual Chinese colonization of areas like Khabarovsky Territory is also a fact, while the Russian population does its utmost to scramble out of the Far East, Chukotka, Sakhalin, and Siberia for “mainland Russia.” These indications of the tendency of some areas to break away from Russia, economically and demographically, were obviously initiated by the radical liberalism policies started under Gaidar: the “invisible hand” of the market is in no way fit to hold together a country stretching over 13 time zones; on the contrary, it is eminently suited to break such a country up. Thirty years ago I, a modest associate professor, could fly to Sakhalin Island for a bit of alpine skiing or to one of the Kuril Islands for a couple of weeks hiking among the giant ferns. These days, a one-way ticket there might cost me my annual old age pension. And without regular communication between the various regions of a far-flung land, isolationism and an eventual tendency toward disintegration are constant dangers to be reckoned with. On the whole, though, I do not believe these centrifugal forces will prevail in the foreseeable future. True, the exploiter classes are afflicted with a bad case of mysopatria, keeping much of their capital, various properties, and their children far from the native land, whose population they fear and despise – but there is nothing new here, the same situation prevailed in the 18th and 19th centuries, and still the country held together and even expanded. True, the exploited classes are too preoccupied with the business of sheer survival to worry about abstractions like the unity of the country, but it is precisely this innate knack of survival under hostile regimes – Tatar, Polish, westernizing emperors and serf-owning landowners’, Communist – that holds the most promise. The middle class, not too overtly patriotic but tied to the land as the only place where it can go on surviving, multiplying, and even mildly prospering, is growing apace despite everything – bureaucratic pressures, crime, corruption, a workforce largely made up of alcoholics. Sooner or later this class will solidify and find its true political representation – then the unity of this country will be assured.

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