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Is Russia Becoming a Free Market Law Based Democracy?

David Satter

Despite Vladimir Putin’s turn to the West in foreign policy, Russia is not becoming a law based, free market democracy. Instead, it is moving toward authoritarianism, a tendency that is likely to increase as Russias economic recovery continues to falter.

Russia is a relatively free country. Russians can travel abroad, speak openly, and demonstrate in public. Against the background of Russian history, this is no small accomplishment.

To become a truly democratic society, however, Russia needs the rule of law, a free press, and fair elections and in Russia today, these institutions have been weakened to the point that they are nearly non functional.

The rule of law presumes that individuals have equal rights and equal protection but in Russia today the only “rights” are the privileges of the stronger.

On December 12, 1997, the official car of Vladimir Putin, who, at the time, was a high Kremlin official, crossed the median strip of the Minsk Highway outside of Moscow and crashed into a car carrying a family. Five year old Denis Lapshin was killed. According to eyewitnesses, in the aftermath of the crash, plainclothesmen not only removed Denis’s body from the area without the permission of his relatives, they also tried to alter the accident scene to make it look as if Putin’s car had not been responsible. Despite years of effort by Denis’s grandfather, Putin’s driver, Boris Zykov, was never brought to justice. The case of Denis Lapshin was one of many in which persons were killed because of the heedless driving habits of Russian officials, their relatives or their chauffeurs but there was no justice in those cases either.

Virtually every medium or small business in Russia is forced to pay protection money to gangsters but there has been no progress in breaking the hold of these criminal gangs although they do not hide their activities and the identity of the leading gangsters is well known. At the same time, law enforcement has had little success in convicting those responsible for any of the country’s hundreds of contract murders. This is particularly true of the most famous cases, those involving Dmitri Kholodov, a reporter for the newspaper, Moskovsky Komsomolets, Vladislaw Listyev, one of Russia’s best known television personalities, and Galina Starovoitova, a leader of the democratic movement during perestroika and a member of the State Duma. In these cases — and many others where powerful interests were believed to be involved — the investigators were constantly changed, relevant witnesses not interrogated and the progress of the investigation hampered by high level interference.

Besides the lack of the protection of law, Russia is not making progress toward democracy because it is being deprived of the benefits of a free press.

On June 7, the property of the newspaper, Novaya Gazeta, a powerful critic of the war in Chechynya, was seized by bailiffs of a Moscow court to satisfy a libel judgment of $500,000 in a case brought by the Mezhprombank, which the paper accused of participation in the Bank of New York money laundering scandal. The fine, equivalent to the paper’s yearly turnover, dwarfed the largest previous libel judgments against Russian media outlets (about $5,000) and led to speculation that it was the result of a political decision to close the paper.

The action against Novaya Gazeta came shortly after the sale of Obshchaya Gazeta, the only other independent Russian newspaper to Vyacheslav Leibman, a 33 year old St. Petersburg businessman who promptly fired its entire staff and suspended publication until the fall.

The threatened loss of the Russia’s two most fearless newspapers comes after the removal of the managements of its only independent television stations, NTV and TV-6, both of which fell victim to pressure from state owned energy companies that had ties to the stations.

The result is that the media in Russia is now completely controlled by the Kremlin and allied financial interests and there is little chance that courageous reporting such as that of Novaya Gazeta on the 1999 apartment bombings or of Obshchaya Gazeta on atrocities committed by the Russian army in Chechnya will be repeated in the Russian press.

Perhaps the most worrying sign that Russia is not moving in the direction of democracy, however, are indications of a lack of commitment to free elections.

Presidential elections are two years away but in two recent regional elections, there were unmistakable signs that the results were fixed.

In April in Ingushetiya, the region bordering Chechnya, the Kremlin backed candidate, Murat Zyazikov, a former Federal Security Service (FSB) general, received 53 per cent of the vote defeating Alikhan Amirkhanov, who was supported by Ingushetiya’s popular former president, Ruslan Aushev, a strong critic of the war in Chechnya. In the first round of the voting, Amirkhanov outpolled Zyazikov by 32 per cent to 19 per cent but during the second round, all polling places were placed under tight police and FSB control, there was widespread bribery and ballot box stuffing and observers were ordered out of polling places at gunpoint.

There were equally disturbing irregularities in the election of the new governor of the Smolensk region which took place in May. In that instance, General Viktor Maslov, the head of the FSB in the region, was elected over the sitting governor, Alexander Prokhorov, who was supported by the communists. Days before the election, gunmen ambushed the car carrying Anatoly Makarenko, Prokhorov’s deputy, wounding his bodyguard and killing his chauffeur. Makarenko said that Maslov was behind the attack. The ambush followed the burning of two dachas belonging to members of Prokhorov’s election staff, the beating of the son of his lawyer and the explosion of a bomb in his election headquarters.

The use of violent tactics in these two recent provincial elections is important because post communist Russia has a history of falsified election results. There were credible reports of falsification in the 1996 and 2000 presidential elections and in the vote on the new Constitution in 1993. The falsification in the vote on the Constitution was sufficient to have changed the outcome. The Presidential elections in 2000 were also heavily influenced by the beginning of the Second Chechen War that many believe was launched in order to guarantee the election of Putin, Yeltsin’s hand picked successor. Given this tradition, the tactics used in the elections in Ingushetiya and Smolensk raise serious doubts about the next Presidential elections which are scheduled for 2004.

Despite a tripling in oil prices and the beneficial effects of the devaluation of the ruble, production in almost half of Russia’s regions continues to decline and the economy as a whole is stagnant. The loss of Russia’s great power status has removed a source of psychological compensation for a beleaguered population and one result is that the question of how state property was divided during the privatization is once again being widely discussed.

In a recent article in the newspaper, Moscow News, the political analyst, Nikolai Trofimov, wrote that in the corridors of the State Duma, it is more and more frequently predicted that the government is preparing to “go after business.” The methods being suggested range from the confiscation of the property of “unprincipled capitalists” and its “fair” redistribution to the introduction of tough financial controls over companies.

Insofar as Putin was chosen by the Yeltsin entourage to succeed Yeltsin specifically to assure that the corrupt Yeltsin era distribution of property was left untouched, this would represent a dramatic reversal but a reversal of which the present Putin-FSB leadership would be fully capable. Persons who made their careers in the Russian secret police are able to play any role. Many high ranking KGB officials who persecuted dissidents and free thinkers under the Soviet regime, for example, went to work for the security services of economic oligarchs after the Soviet Union fell.

Trofimov predicted that the Putin leadership might now be ready to put pressure on 10 per cent of the population in order to calm the remaining 90 per cent, in this way taking advantage of the class antagonism of the broad mass of the population.

The lack of the rule of law, the limits on press freedom and the fragility of the electoral system all pose a threat to Russia’s future as a democracy. This is all the more true because Russia faces the problems of an obsolescent infrastructure, the loss of its once formidable scientific and research potential and a population that is falling at the rate of 800,000 a year.

At a recent seminar in Moscow, Tatyana Zaslavskaya, Russia’s leading scholar in the field of economic sociology, outlined three possible scenarios for Russia’s future. The first was “authoritarian-coercive.” According to this scenario Russia would witness a drastic strengthening of the authority of the state and the security services and the introduction of strict control over the market economy and a shift to repressive practices.

The second scenario, described as “conservative statist” envisaged the preservation of a free market and democratic practices in the form of a façade behind which the state would strengthen its control over all aspects of social life. The third scenario, “semi-criminal oligarchic,” would reproduce the Yeltsin era system of interlocking business and criminal elites.

Zaslavskaya first achieved fame in 1983 when a paper that she gave at a closed seminar attended by Gorbachev was leaked, revealing to the world that radical changes in the Soviet system were under serious consideration.

At the seminar where she unveiled her three scenarios for the future, Zaslavskaya was asked about the possibility of a liberal democratic evolution for Russia. She said that such a scenario was supported by some groups in Russian society but, unfortunately, these groups had no representation in the power elites. As a result, the realization of a liberal democratic alternative for Russia was “extremely unlikely in the foreseeable future.”

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