With the adoption of the “anti-crisis
program of the government” made up of 60 items, the world
“crisis” became official in Russia. But the authorities
are moving very slowly toward an understanding of the
fundamental reasons for this crisis.
For months they spoke of the “consequences
of the crisis in Southeast Asia”. Lately they have been
talking about a “plot of stock-market speculators who
are trying to empty our pockets”. Strangely enough, Central
Bank chairman Sergei Dubinin, in particular, has taken
great pains to develop this theme. But if he complains
about a plot of some successful speculators, then he is
complaining about his own unprofessionalism.
If we want to be cured, it’s high time
to make a proper diagnosis. We must determine whether
we are suffering from Asian flu or some more serious decease
- Russian pneumonia?
An attempt to make this diagnosis was
made by Leon Aron in his article “What stalled Russian
Reform”. (Washington Post, June 12). The author justly
points out that by blocking necessary legislation (land
privatization, and tax code) the leftist majority in the
Duma negatively affects the course of the reform in Russia.
But focusing exclusively on this only
factor he gives, in my view, a misleading perspective
on the current Russian social and economic scene. He depicts
it as an almost Manichaean struggle between Communist
Evil and Democratic Goodness, embodied by President B.
Yeltsin and his regime. I am not going to elaborate here
on performance of Democratic Goodness in Chechnya where
tens of thousands civilians were killed. What I would
argue here is that the ruling regime is even more responsible
for Russian current predicament than the communist opposition.
This is becoming evidently clear to many
top Western officials who have been working closely with
the Russian government for many years. Among them are
IMF Managing Director Michel Camdessus, who warned Yeltsin
of the “dangerous similarities between the chaebols, Korea’s
closely held family conglomerates, and the prevailing
relation among oligarchy members in Russia”, and U.S.
Treasury Secretary Lawrence Summers, who said that “one
of the real dangers Russia now faces is the same kind
of crony capitalism that helped cause the Asian financial
crisis”.
Russia’s fundamental problem is not communist
hard-liners in the Duma but its oligarchic system of incestuous
collusion between Power and Money. This system indeed
presents more dangers than Korean chaebols or the Indonesian
chuko.
Before it became evident that the system
of chaebols was detrimental to further development of
the Korean economy, the chaebols had created modern branches
of industry that won a place on the world markets for
automobiles, electronics and shipbuilding.
But what has the chaebol of the speculator
in automobiles, Boris Berezovsky, or the chaebol of Vladimir
Potanin, a private banker inclined to suck the state budget
dry, created in Russia? Where are the industries and technologies
created by them or highways and scientific cities built
by them as is the case with Tegjon or Kwangiu in Korea?
The leaders of the economy in Korea and
Indonesia turned out to be people not without vices. But
they created modern economies in their countries from
nothing. Our oligarchs turned out to be capable only of
stuffing their pockets with the riches of a former superpower.
The government now speak for the first
time of bankruptcies and the sale of debt. In practice
this would mean a new redistribution of property on a
large scale throughout the country. There would be a need
to remove all the thieving directors who were appointed
by the authorities themselves and give the companies over
to effective managers. But, first of all, where are you
going to get these effective managers? Second, the current
masters of the Russian economy - from the oligarchs to
the so-called red directors - would not await their lot
passively.
A year ago then First Deputy Prime Minister
Anatoly Chubais got convinced of this. After creating
a system of corporate capitalism and personally appointing
superwealthy people who got rich at the expense of the
state budget, he naively supposed that starting from any
moment he could introduce a new system of honest and transparent
rules of the game. The oligarchs who, like drug addicts,
could no longer kick the state budget habit, started a
war of moral destruction against Chubais. Among other
things, they informed us about the interest-free credit
he received in 1996 and about his stormy writing activities
in 1997 and 1998.
The current young and not-very-young
reformers will undergo a no-less-concentrated attack if
they try to establish order in the economy. And they will
turn out to be no less vulnerable than Chubais. Russia’s
Power and Business have long befouled themselves together
in the carnal sin of corruption and theft.
And it is quite natural that the only
Democratic Opposition left in the country - Grigory Yavlinsky’s
Yabloko faction denounces the crony capitalism system,
that Yeltsyn’s successive governments have been building
on in the country. But it is unjust and hypocritical to
put Yabloko on the same footing with the communist for
this reason as Mr. L. Aron does in his article. And it
is merely untrue to state that “in virtually every vote
on economic matters, the Communist were joined by Grigory
Yavlinsky’s Yabloko faction”. This statement is refuted
by every Duma voting protocol. Yabloko’s staunch support
for private property on land is well known. A new tax
code which “would have reduced the number of taxes from
more than 300 to no more than 5 and would have significantly
lowered the rate for both individuals and business” was
actually introduced not by the government but by the Yabloko
faction. And the of vote on “a Duma low that limited to
25 percent (from the current 30 percent) foreign ownership
of the state operated Unified Energy System electric monopoly”is
as follows: Communist - 92% for; Yabloko - 0% for. It
seems that Mr. L. Aron both in his conceptual perceptions
and factual data fall victim to misinformation by his
Russian sources.
