Chaos Management - Russia's lingering political and economic problems

National Review, June 14, 1999 by David Pryce-Jones

The state has failed.

In Russia today, the elements of catastrophe seem to be gathering. The currency has collapsed, there is no wealth creation, land remains unprivatized, and conditions generally are intolerable. The future hangs on a single man, Boris Yeltsin, the president-Tsar Boris to the Russians. Elderly, ill, crafty but not a statesman, he evidently has no idea of what should be done. Each time push comes to shove, he resorts to the same bewildered and bewildering device of appointing a new prime minister. The latest, Sergei Stepanshin, is the fourth in a short period of time. A mere figurehead, the person of the prime minister is immaterial in reality. The state has failed. As in 1917, power is lying in the streets.

When states fail, they founder in revolution and civil war. Russia is a federation of no fewer than 89 regions with recognized degrees of autonomy. Three or four times as many small but distinct national minorities have long-cherished separatist aims or aspirations. If Moscow does not hold, dozens of nationalist struggles have the potential to end in fragmentation and civil wars whose outcomes are unpredictable.

Day by day, signs multiply that the center in Moscow is giving ground. Each region has its governor, who is elected locally. Defending their interests, these governors increasingly keep control of the local economy and its resources, no longer remitting money to Moscow in the form of taxes. A vicious spiral results. Receiving only about 30 percent of the tax revenues due, the state cannot meet its federal obligations. Russia cannot pay for its army and its police, its school system or its hospitals or its pensions.

The poor and needy are left to starve. Communications break down. There is no money to prevent Chernobyl-type accidents at outdated nuclear- power plants and in nuclear-powered submarines. The richest country in the world in terms of resources, Russia now has an economy about the size of Holland's.

The supposed transition from Communism to democracy was not quite what it might seem on the surface. The old ruling Communist party has merely split into two blocs. Party diehards continue to call themselves Communists, and under Gennady Zyuganov they dominate the parliament, or Duma, anticipating and working for some return to the old days. In temperament and upbringing, Yeltsin belongs with them, but his relentless struggle for supreme power obliged him to position himself at the head of the other bloc, the so-called reformers.

What exactly had to be reformed-and how-was uncharted territory. Here was a political and social dilemma in need of a Locke, a Montesquieu, the Founding Fathers. Those who in fact addressed the question had only a lifetime's experience of Communism to guide them. After the implosion of the Communist party in 1991, several legal experts in Moscow were commissioned to draft the outlines of new institutions. Rejecting the various proposals submitted to him, Yeltsin put in place in 1993 a constitution that reserved executive and legislative and even judicial powers to the president. In plain language, Yeltsin privatized power to himself.

As Tsar Boris, he rules by decree, signing every year somewhere between 15,000 and 20,000 of them, some essential, others trivial. To have any conception of the contents of so much paper is beyond one man's capacity. Most of the time he signs whatever lobbyists and fortune- hunters put before him. Carrying the weight of law, a Yeltsin signature means privilege and wealth to whoever can master the black arts of obtaining and then enforcing it, and all at the expense of the public purse.

Russians as a people are unusually generous, rather sentimental, and no more dishonest than others. But first Communism, and now this novel and peculiar mutation of it, has encouraged cruelty and selfishness. Individuals protect themselves as best they can, self-abasing towards those who can hurt them, and ruthless to those whom they can hurt. Employers cease to pay wages, wage-earners cease to pay taxes. To be a good citizen, or to show altruism, is to do yourself an injury.

The concept of social contract is absurd in such circumstances, and there can be no question of the rule of law. The gang becomes the one vital voluntary association. There are said to be at least 10,000 gangs operating at present in all areas of the country, all employing criminal methods and a law unto themselves. Yeltsin's cronies are one gang, the Communists in the Duma another, the police a third, the army a fourth. Each banker and press lord has his retainers and guards, and so on down to the hoodlums with hand grenades and small arms.

As the gangs obtain, and then enforce, Tsar Boris's many and sometimes contradictory signatures, dirty tricks expand to fill the whole of public life. As in old Soviet days, powerful petitioners drive into the Kremlin in black cars with blinds drawn over the windows. Who owes what to whom? Rumors circulate about the honesty of Yeltsin himself, his daughter Tatiana and some of his closest associates. The numbers of hidden and illegal foreign accounts are available on the Internet, but nobody is prosecuted. Anyone who obstructs a private interest is liable to be disposed of, perhaps murdered.