Streetwise Professor

October 8, 2014

Pugachev’s Rebellion

Filed under: History,Politics,Russia — The Professor @ 8:41 pm

Spare a thought for ex-oligarch Sergei Pugachev, who was expropriated by the Russian state in 2012. Sergei has had a blinding insight about the nature of Putinistan:

A former close associate of Vladimir Putin has said Russian businessmen were all now “serfs” who belonged to the president, with none of the country’s companies beyond his reach.

. . . .

Speaking to the Financial Times, Mr Pugachev warned that there were no longer any “untouchables” in a Russian business landscape increasingly dominated by Mr Putin. The Russian economy, he argued, had been transformed into a feudal system where businessmen were only nominal owners of their assets.

“Today in Russia there is no private property. There are only serfs who belong to Putin,” he said.

. . . .

“Now there is Putin and there are his lieutenants who carry out his orders – and all cash generated is put on the balance of Putin,” he said. “The country is in a state of war. And therefore big business cannot live as before. It has to live under military rules.”

Excuse me while I wipe away a tear for a fallen oligarch.

But seriously, this is a revelation? This has been obvious since very early on in the Putin years.

Indeed, it is just a recognition that Putin’s Russia is the continuation of a historical tradition stretching back to the dawn of Muscovy. As Richard Pipes wrote years ago, Russia/Muscovy was a patrimonial state in which all property was the tsar’s. Possession was temporary,  contingent on service, and conditional on the will of the tsar. Muscovy was the land of kormenlie-“the feeding”-in which the tsar granted a lucrative territory to an official, who was expected to support himself off of what he could take from it, and provide the tsar with service. Lands and serfs were granted to individuals in exchange for service, but were not property as such. Everything was occupied at the sufferance of the tsar. The system was later softened, and the service obligation weakened, but since forever the patrimonial aspects of the Russian state have survived. Putin is just the latest in a long tradition.

As I’ve written since the very beginning of the blog, Putin’s Russia is a “natural state” in which the ruler adopts policies that create rents, and then divvies up those rents in order to secure support,  to reward those who do his bidding and punish those who don’t: patrimonialism is one of the most primitive forms of the natural state. So the Timchenkos and Rotenbergs and Sechins live large, and the Yevtushenkovs and Khordokovskys and Pugachevs get crushed. Sometimes people are broken for a reason: sometimes the fall is arbitrary, just to demonstrate who is boss and to reinforce the understanding that wealth and power are contingent on the Putin’s will.

As I also wrote for a long time, especially around the time of the crisis in 2008-2009, the survival of this system depends on the existence of a stream of rents. When that stream dries up, it is more difficult to buy the subservience (I would not characterize it as loyalty) of the placemen. At such times, the system becomes vulnerable to collapse.

And there are some indications that this is the case now. One must always be cautious about trying to figure out what is going on behind the scenes in Russia, but there are some visible indications of a system under stress. One is the resort to sticks, with Yevtushenkov’s arrest being one example, and myriad repressive measures being others: sticks are needed all the more when the carrots run low. Another is the pervasiveness of propaganda. Yet another is the need for foreign adventures, confrontations with the outside world, and the assiduous cultivation of an us-versus-them mentality.

But perhaps the most telling indicator is the increasingly bizarre cult of personality being constructed around Putin. Putin’s apotheosis is occurring on his 62nd birthday. Almost literally. Recently an Orthodox activist suggested that Putin will become God, or the human embodiment of God on earth, through divine grace. There was an exhibition in Moscow portraying him as a Russian Hercules.  Russians from all walks of life-including hockey playing ape Alex Ovechkin-thronged to wish VVP a happy birthday. Other evidence of cultism abound.

A society that does this is not healthy. A society that does this is deeply insecure. A society that does this is desperate to believe that it is the hands of a savior because the alternative is too frightening to contemplate.

A society like this, a polity like this, is extremely brittle. It is at risk to shattering into a thousand shards.

Centuries ago, a rebel named Pugachev shook Catherine the Great’s Russia to its foundations. The 21st century Sergei Pugachev does not pose such a threat, but in a state as brittle as Putin’s Russia, a latter day Pugachev may arise from the steppe. Or from the center of Moscow.

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  1. Hey no need to worry, just more proof that Putin is on the wrong side of history. . . Right?

    Also, wow, that 12 Labors of Putin exhibit is just outrageous.

    Comment by JDonn — October 8, 2014 @ 9:04 pm

  2. @JDonn. Yes, but by the time history gets everything squared away massive damage has been done.

    And yeah. Outrageous. Campily outrageous.

    The ProfessorComment by The Professor — October 8, 2014 @ 9:14 pm

  3. Typo? kormlenie = кормление

    Comment by Dr Bill — October 8, 2014 @ 11:55 pm

  4. IIRC, Pugachev, aka “the Orthodox banker [as in “Eastern Orthodox” rather than “prudent”] Sergei Pugachev”, was reportedly a member of Putin’s inner circle only 6-7 years back, in 2007-8. Now he has seen the light. I wonder what he was saying during the Khodorkovsky trials.

    Comment by Alex K. — October 9, 2014 @ 1:39 am

  5. @alex.K what was he thinking:
    a. Schadenfreude.
    B. How can I get my hands on his money.
    C there but for the grace of Putin (or divinity like him) go I.

    Comment by sotos — October 9, 2014 @ 10:06 am

  6. As Edward I was the Hammer of the Scots, so too would Putin be the Hammer of Obama, if you could hammer a sponge.

    Comment by Green as Grass — October 9, 2014 @ 10:17 am

  7. Excellent post. I started writing a comment but it got a bit long so I turned it into a post of it’s own. The most worrying thing is that trying to see beyond the Putin era is like looking into an empty void. There is simply no succession plan, no contemplation of life after Putin. This is gonna get messy.

    Comment by Jake Barnes — October 9, 2014 @ 11:58 am

  8. Since you don’t watch Russian news, you were spared the story of the recently-opened boutique catering to Putin fans in New York. Apparently there’s enough useful idiots in the US to swallow the bait.

    Comment by aaa — October 9, 2014 @ 12:22 pm

  9. @Jake-Thanks. I’ll read your post with interest.

    To Putin, the lack of a succession plan is a feature not a bug. He takes comfort in knowing that there is no alternative: that makes his position more secure, as people don’t want to venture into that empty void. That’s especially true in Russia, given its traumatic past, including its very traumatic recent past. He has deliberately eliminated any potential alternatives, or the creation of an institutional framework that will permits a peaceful succession.

    But Putin is mortal. Eventually the succession must occur. But by his design that succession will be very messy.

    Apres lui, le deluge.

    The ProfessorComment by The Professor — October 9, 2014 @ 2:56 pm

  10. @aaa-I did see that news story. Disgusting. Nauseating.

    The ProfessorComment by The Professor — October 9, 2014 @ 2:56 pm

  11. @Jake-Great post.

    It’s like watching a train wreck. You can see it coming. You know how it’s going to play out (when Putin starts to drool or keels over or falls out of a hang glider or gets eaten by a tiger) but there’s not a damn thing you or anyone can do about it.

    The ProfessorComment by The Professor — October 9, 2014 @ 4:54 pm

  12. @sotos: a bit of (C), no doubt, but also, “He was not one of us, moved against us, and got his just deserts. I need to be careful not to piss off the Godfather, ever.”

    Comment by Alex K. — October 10, 2014 @ 1:44 am

  13. SWP:

    Vlad used to lament the deplorable current state of American TV, once the Mecca of civilization (perhaps back in the 60s). Today it is a cultural wasteland. It is more fun to read SWP’s posts & the comments of his erstwhile scriptwriters, here, in Commentland. Thank you all for sharing your thoughts & links.

    VP VP

    Comment by Vlad — October 14, 2014 @ 6:36 pm

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