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PROSPECTS
FOR DEMOCRACY IN RUSSIA
Johnson's Russia List #5166, 23 March 2001
Moscow Times
March 23, 2001
First Law and Order, Then Democracy
By Paul Klebnikov
Paul Klebnikov is a senior editor at Forbes and author of "Godfather of
the Kremlin: Boris Berezovsky and the Looting of Russia."
Just about a year ago, Vladimir Putin became post-communist Russia's second president. Since then, many people in the West have been sounding the alarm. Putin, it seems, is trying to turn back the clock. He has adopted a more aggressive military posture; revived some old-fashioned Soviet symbols; and cracked down on his country's unruly governors, media magnates and other top businessmen.
How alarmed should the West be?
Is this former KGB man killing off the fragile shoots of Russian democracy and capitalism that sprouted after the fall of communism? No. By dismissing Putin's policies as a rebirth of a Soviet-style dictatorship, Western analysts and policy-makers risk repeating the same simplistic mischaracterization they made in the 1990s, when they naively praised Boris Yeltsin for being a "democrat" and "reformer."
Any sober-minded analysis of Russia today would have to include several unpleasant truths.
Unpleasant
Truth #1
The businessmen that Putin is currently persecuting--men like media magnate
Vladimir Gusinsky, billionaire power-broker Boris Berezovsky and other
oligarchs--are not and never have been avatars of free markets or democracy.
For the most part, they are crony capitalists who made their immense fortunes
through corruption, fraud and even violence. For most of the Yeltsin years,
they were allowed to dictate government policy, loot state property at
will and siphon off their earnings abroad. The result was a ruined economy,
a bankrupt government and an impoverished population. In any just society,
these kinds of operators would end up behind bars.
Therefore,
Putin's crackdown on the oligarchs--clumsy and ham-fisted though it is--should
be applauded. He calls this establishing a "dictatorship of the law."
Is he destroying democracy?
Unpleasant Truth #2
Russia was not a democracy under Yeltsin, it is not a democracy today
and it is not going to be one for a long time, no matter what Putin does.
A real democracy can be built only on the foundation of a vigorous civil
society hundreds of thousands of institutions and associations operating
independently from the state. Only when a nation's citizens are active
in local self-government and the court and are united in a broad range
of political parties, religious institutions, labor unions, professional
associations and political-pressure groups of all kinds does the citizenry
acquire a voice capable of challenging the authority of the state. Without
these associations, the role of the people in popular government is little
different from the role of the crowd in a football match.
It was utopian to believe that you could take a totalitarian dictatorship of the Soviet mold and turn it into a democracy overnight merely by re-writing the Constitution. With its independent civic institutions having been rooted out by 75 years of communism, Russia today has very little of the foundation needed for the people to have an effective voice in who runs the country. It will take years, perhaps a whole generation, to develop Russia's civic infrastructure.
Unpleasant
Truth #3
The economy that emerged after the fall of communism was never a genuine
free market. Here again, Westerners applauding Yeltsin's "market reforms"
were naive in thinking that you could take a Soviet-style planned economy
and turn it into a market economy merely by freeing prices and privatizing
the bulk of the state's assets. The result of this "shock therapy" was
that the most powerful insiders grabbed the best state-owned companies
and ran them as corrupt rackets. It was as much of a free market as the
garbage-hauling business in many American cities.
A free market cannot be created by government decree. It has to evolve on the foundation of millions of small businesses, operating without fear that corrupt bureaucrats or gangsters will be knocking on the door. This is something that Russia does not yet have.
Although the establishment of free-market capitalism and democracy is going to take a long time in Russia, there is one thing that Putin can do relatively quickly: Establish the rule of law.
In the evolution of most societies the establishment of the rule of law predates the onset of democracy. It is the essential precondition for the development of civic society. So lawless was Russia in the 1990s that independent labor leaders were simply murdered when they challenged management too aggressively, while the heads of several big charities were murdered by gangsters who wanted to use the institutions' nonprofit status. Among other things, the rule of law protects the weak from predation by the strong; it protects unarmed citizens from thugs and gangsters. For this reason, the rule of law is also essential to the development of the small business sector that underlies any healthy market economy.
Yet, Putin's push for the rule of law has evoked cries of alarm. Boris Berezovsky--car dealer, media magnate and chief of the oligarchs--has fled Russia and refashioned himself as a political refugee from Putin's "authoritarian" regime. Berezovsky argues that since virtually every successful businessman had to violate the law in the Yeltsin years, Putin should declare an amnesty on all crimes committed in the 1990s. Those in the West wringing their hands about the new activism of prosecutors and tax inspectors under Putin's administration would seem to agree.
Yes, the laws on the Russian books are highly imperfect, but that does not mean that the law shouldn't be enforced at all. The Russian government could start with enforcing one of the simplest laws, the one against murder. Every year many top businessmen, government officials and civic leaders are assassinated. Yet, the police solve only a fraction of these contract killings. There simply is no political will to enforce the law.
By indicating that he wants to apply the law to some of Russia's most powerful tycoons, Putin has made a step in the right direction. True, the Russian president may yet turn out to be a mad dictator, but there is no evidence of this to date. If anything, Putin has been too hesitant and haphazard in going after his country's biggest malefactors. Prosecutors talk about going after crony capitalists like Berezovsky and Gusinsky for fraud and embezzlement, but even after several years of gathering evidence, they have failed to bring a single high-profile case to trial.
Putin has also taken steps to make life easier for small businesses--by simplifying the Tax Code (with a 13 percent flat income tax) and supporting a law on private ownership of land. But here again, a lot more needs to be done. Putin still has to clear away the thicket of government regulations that continues to stifle entrepreneurship in Russia.
It is on this basis that the West should judge Putin's administration. Is he strengthening the rule of law? Is the wave of gangsterism subsiding? Are small businesses flourishing? Are civic associations multiplying? These are the yardsticks by which we will be able to tell whether Russia is moving toward democracy.
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