Prospect's counter-factual columnby Ben Judah / August 21, 2013 / Leave a comment
Published in September 2013 issue of Prospect Magazine
Vladimir Putin, Boris Yeltsin’s “robust military man.” (© Alexey Druzhinin/AFP/Getty images) Russia has a cult of the leader in reverse. From the grinning traffic cop rapping his knuckles on the car window for a bribe to the anti-American minister embezzling the defence budget into the Cayman Islands—everything is blamed on Vladimir Putin. Does this sullen fitness fanatic bear sole responsibility for Russia’s rotten state? No—the country would have been pillaged without him. Let’s imagine the Kremlin minus Putin, beginning with a Russia that never defaulted in 1998. That crash wiped out millions of life savings and convinced Boris Yeltsin only “a robust military man” could now save Russia. Yet bankruptcy could have been forestalled. Persuading Bill Clinton that default would kill democracy could have extended one last credit line. Reprieve would have brought Yeltsin’s then dauphin to power—the inveterate liberal Boris Nemtsov. A debt-crippled Kremlin would have been hamstrung when Chechen terrorists attacked deep into Russia, so Nemtsov would never have marched on Grozny, fearing its fiscal impacts. Abandoning the Caucasus would be cost effective—$80bn is being spent between now and 2025—but would have cost him his popularity. Had Russia gone bust in, say, 2003, it would have coincided with the rise of its then richest man, Mikhail Khodorkovsky. Pushing for a parliamentary republic and extensive “lobbying” (read: renting lawmakers) imprisoned him in Putin’s Russia. In a fantasy one, he could have “lobbied” the Duma into changing the constitution and making him Prime Minister—Putin’s worst nightmare. Alexander Solzhenitsyn, the revered anti-communist dissident, would have been enthroned as ceremonial President. The FSB, the KGB’s successor, would have been broken up, and Lenin’s mausoleum would have become the tomb of the Unknown Slaughtered of Stalinism. Yet Khodorkovsky’s Russia would have hurt the poor. Ignore his democratic myth-mongering: the billionaire fought Putin over oil. The clash was really about whom the booming barrel would empower; the oligarchs or the state. Khodorkovsky lobbied to keep the oil tax below 50 per cent. He lost, and Putin hiked the tax to 83 per cent. Had Khodorkovsky been in power this would not have been a Russia of oligarchs, but hypergarchs. Putin pumped oil revenues through the state and allowed his henchman to drink from it, but Khodorkovsky would legally have put even more in far fewer hands. Russia would have been unable to double pensions and public salaries; the state would have been on unnecessary rations. Male life expectancy would not have climbed from 57 to 64 as there would have been less to splurge on hospitals. Subsidies would not have slashed unemployment in Russia’s single-industry cities, which would have turned into hundreds of apocalyptic Siberian Detroits. Putin terrified the oligarchs out of investing in anything political after the real Khodorkovsky was flung into a Siberian prison. No tycoon has since dared pour the millions he did into private universities, schools or pet politicians. In Khodorkovsky’s Russia, the oligarchs would not have been forced to invest in neutral assets like football clubs. Moscow would have world-beating universities—imagine the endowment of the Abramovich Academy—and a score of fiercely independent TV stations. Russia would have remained endemically corrupt. Russian officials are predatory not because the state is strong but because the state is weak. Bureaucrats would have extorted businessmen in just the same way in a malnourished state. There would have been no de facto one-party state with United Russia but weak coalitions in the Duma stitched together through bribes. Reform would still be stymied, with every oligarch renting out deputies to protect their monopolies. Russia would still have had a wave of protests after the 2009 recession, but with very different faces. Instead of the middle class, the angry protestors of Khodorkovsky’s Russia would have been the urban poor. We can easily imagine Alexey Navalny (a well-financed Duma deputy and not an embattled blogger-activist) screeching at 100,000 shivering, hungry protestors in Red Square—“Down with the party of crooks and thieves!” Safe in the knowledge he wouldn’t be harmed, yes—but given Khodorkovsky’s dream of a lightly-taxed oligarchy, his slogan would still be appropriate. Navalny castigated the Putin elite as “a bunch of worthless former Komsomol activists turned democrats turned patriots who grabbed everything into their hands.” He would have said the same of Khodorkovsky.