Right now, I’m reading Alfred Koch’s rambling 2009 book A Crate of Vodka, in which he and journalist Igor Svinarenko muse over their lives in the period 1991 to 2001. Koch was Russian Deputy Prime Minister, with responsibility for privatization, in the mid-1990s, and his book provides an insight into the inner workings of the Russian liberal mind of that period. On pages 44-45 and 284 of the book, he notes the following:
I have nothing against a strong hand, when it is strong. I developed a lot of my mentality in Chile. We got some training from ministers who were in the Pinochet government. … Pinochet didn’t try to pass himself off as a democrat, which he was not. He knew they needed to build a liberal economy, and he built it; he knew they needed to stifle the opposition, and he stifled it. Just as he was supposed to. … It pained me to think that we, unlike the Chileans, did not manage to seize power from our leftists in 1973. We had Russian Communists an extra 18 years in our country … The mighty old man Pinochet spared his country the humiliations that are inevitable under a Communist regime. He overthrew the regime when he got sick and tired of it, when he couldn’t stand it any more. … Grandpa-General Pinochet acted like a man, and shot from the hip. But we didn’t have any one in those years who could have brought the country in line with common sense. Who had the strength, the intelligence, and the conscience. It just didn’t work out that way. … Chile, 1973. Total collapse. The economy just stopped. The country was bankrupt. Politically, a dead end. Then, like in a bad movie, fast forward on the calendar, twenty years later… What better example do we need to see that we must act and not just gab about reforms?
There’s been a lot of talk recently about how modern Russia has moved in an authoritarian direction in the past couple of years. Of course, people have been saying that for years, but the argument is that with a recent clampdown on opposition activist Alexei Navalny and his allies, Russian president Vladimir Putin has shifted from ‘soft’ authoritarianism to ‘hard’ authoritarianism. Anna Nemtsova, for instance, recently published a piece in the Daily Beast with the title ‘Russia plunges into era of “dictatorship” as Putin looms over Eastern Europe.’ Other such articles abound.
I’ll admit that I’m not a fan of many of the repressive measures recently introduced by the Russian state: declaring media ‘foreign agents’, labelling Navalny’s organization ‘extremist’, and so on. But while Russian liberals bleat about the illiberal and undemocratic nature of their government, Koch’s statement above makes it worth spending a little time considering how Russia ended up that way and who built the system that Putin now governs.
Back in the dying days of the Soviet Union, starting around 1989, Soviet intellectuals for the first time had an opportunity to undertake a serious debate about what sort of political system they wanted to replace the ‘dictatorship of the proletariat’, or more correctly the dictatorship of the Communist Party of the Soviet Union. Russia’s newly liberal intelligentsia divided into various groups. One, centred around people like Andrei Sakharov, favoured cooperation with the communist party and the government in order to move gradually towards a multiparty democracy and a mixed-market economy. Others on the other extreme, such as the party Democratic Union and Valeriia Novodvorskaia, wanted to smash the system and move immediately to fully fledged Western-style liberal democracy and a free market economy. A third group shared the aims of the radicals, but believed that liberal democracy and a free market were incompatible. The destruction of the Soviet economic model would inevitably cause great hardship, which would lead to popular resistance. It could only successfully be introduced by non-democratic means. What was needed was the Pinochet option – economic liberalization combined with a strong hand.
All this is well covered in something else I recently read, a 2016 academic article by Tobias Rupprecht entitled ‘Formula Pinochet: Chilean Lessons for Russian Liberal Reformers during the Soviet Collapse, 1970-2000.’ In this Rupprecht cites not only Koch, but also economist Vitaly Nayshul, who drew up the voucher privatization scheme used in the 1990s. Nayshal noted, ‘Our country lost tens of millions of lives – and mostly in vain – at the time of the Bolshevik Revolution of 1917 and the ensuing turmoil. Chile lost 3,000 and became a highly developed society.’ Likewise, Petr Aven, an advisor to early-Yeltsin era Prime Minister Egor Gaidar, stated that ‘Pinochet brought stability to the country – he knew exactly what he wanted’. And Mikhai Leontiev, an associate of the ‘liberal’ oligarch Vladimir Gusinsky, called Pinochet ‘one of the greatest politicians of the 20th century’ and a ‘bright example’ for Russia.
Other prominent late Soviet figures also spoke out in favour of a ‘strong hand’. An example was Andranik Migranyan, who later became a member of Boris Yeltsin’s Presidential Council. In a 1989 article in the journal Novyi Mir, Migranyan commented that,
History knows no case of a totalitarian political system making a peaceful transition to a democratic one. … while the highly complex process of forming, shaping and establishing a civil society is in progress, it is extremely important that a firm authoritarian regime be maintained in the political sphere.
Likewise, in 1990 the Association of Social-Economic Science, headed by Anatoly Chubais, a key figure in the privatization process of the 1990s, published an article noting that economic reform would cause significant pain, in response to which the authorities would have to resort to ‘a toughening of measures’, such as ‘dissolving official trade unions if they opposed government measures’. During the reform process, democrats would have to make use of ‘undemocratic measures’, such as ‘banning strikes, control of information’ and so on, said the article. In particular, the state would have to retain control of the mass media.
One can see, therefore, how the liberal reformers who dominated Russian government in the 1990s favored economic reform over democracy. The way they behaved in power reflected this.
In March 1991, Yeltsin persuaded the Russian Congress of People’s Deputies to give him the power to rule by decree. This provided the basis on which the reforms of the 1990s were implemented – by fiat, rather than by parliamentary legislation. According to an article in the journal Communist and Post-Communist Studies, published in 1995, ‘it is presidential decrees that have accounted for 95 per cent of the legal and economic changes under Yeltsin.’ Author Barry Sautman recounts other examples of the authoritarian methods used by the Yeltsin government. These included ultimately unsuccessful ‘ukazes banning the CPSU, the “conservative” National Salvation Front and Zhirinovsky’s Liberal Democratic Party.’ Next Yeltsin announced a regime of ‘special rule’, which he soon had to abandon, while ‘Liberal intellectuals … mounted a campaign to persuade Yeltsin to disband parliament and repress his opponents … to follow the example of Pinochet.’
The result was Yeltsin’s unconstitutional dissolution of Russia’s parliament, the Supreme Soviet, its subsequent destruction with the help of the tanks of the Russian army, and then the introduction of a new constitution that concentrated power in the hands of the president.
Russian liberals celebrated Yeltsin’s ‘coup’. Dmitry Travin, an economist working for Chubais, wrote that, ‘History teaches us that most radical economic reforms, if not all, are not implemented by democratic rulers, but by autocrats.’ Franco’s Spain and South Korea, among others, were cited as examples.
Post-1993, Yeltsin’s Russia descended into an oligarchic system of government, in which a handful of individuals who had profited off privatization held enormous power and misused it for their own purposes. In A Crate of Vodka, Koch recounts how Gusinsky used his control of the media to in effect run a protection racket. ‘We explained very clearly [to the Americans],’ he writes, ‘what freedom of speech was in Gusinsky’s hands, how much he charged not to attack people in his media. … They say his fee was $50 million a year. … I didn’t pay him a single kopeck. Maybe that’s why he attacked me so vociferously in 1997.’
Another ‘liberal’ oligarch, Mikhail Khodorkovsky, had a different approach, if one believes a recent story in Meduza. This tells how in the early 2000s, Khodorkovsky’s company Yukos tried to stop the Russian government and parliament from passing legislation that would increase the amount of tax that Yukos had to pay. According to Herman Gref, at the time a government minister,
Major oil companies were not happy with the [tax] proposal. He says “a representative of the company Yukos” approached him on the night before the new law was to be discussed by the Duma and told him that they’d made an agreement with all of the deputies. As a result, the ministers were given a choice: they could either not take the proposal to parliament, or they could “be taken out [feet first]”.
Of course, a lot has happened since then, but the stories above tell us something quite important. Russia didn’t enjoy ‘liberalism’ and ‘democracy’ in the 1990s, and then suddenly descend into ever-growing authoritarianism under Putin. This doesn’t excuse illiberal and undemocratic practices by the current government. Putin has had 20 years to do something about all this, and apart from purging the oligarchs in the early 2000s, hasn’t done much, if anything, to make things better. Still, it wasn’t him who created the system in the first place. Post-Soviet Russia was authoritarian from the start, by the design of Russian liberals. Meanwhile, various individuals became fantastically rich from the collapse of the Soviet Union and presented themselves as ‘liberal’, while actually behaving in a thoroughly ‘illiberal’ and undemocratic fashion. This goes some way towards explaining why liberalism has such a bad reputation in Russia. If Russians are sceptical about liberals’ democratic pretensions, they are some good reasons why.