There’s something rotten in the state of Russia

06 January 2010

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President Dimitry Medvedev was supposed to clean up his country but, says Owen Matthews, feudalism, lawlessness and corruption suit all those keen to hold onto money and power

The Hermitage case, by the way, is by no means unique — according to Transparency International, an NGO, a staggering three quarters of Russian small and medium-sized businesses report having fought off some kind of ownership raid by scammers in league with bureaucrats. And over the last year and a half three major Russian retailers have been taken down in raids by police, their owners either jailed or fled.

That absence of recourse to law changes everything. First and foremost, it utterly undermines the much-vaunted stability in whose name Putin eliminated all the checks and balances. Every Russian, except perhaps the highest Kremlin cadres and their circles, is suddenly vulnerable to a change of fortune that could land them in jail. All it takes is for an angry business partner or an ex-husband to make a payment to the right law enforcement body or FSB office. That knowledge extinguishes any possibility of long-term business planning; it kills entrepreneurism and initiative. It incentivises stealing, both for businessmen who know they have to stash as much as possible before their businesses are raided, and for bureaucrats who take over businesses with impunity (as long as they kick enough profits upstairs to their liege-lords).

Medvedev is not a fool; he knows the system from both sides, from his days as a corporate lawyer and major shareholder in a paper-pulp company in the 1990s. But his tragedy is to believe that the system can be fixed on its own terms, and that he can change things for the better from the inside. Lord knows, this energetic, fragrant little man is certainly no Ivan the Terrible. But at some deep level he still believes that it’s the Tsar, and by extension the state, which must rule and which must solve Russia’s problems. But in reality it’s the rotten state itself which is Russia’s biggest problem, corrupting and ruining everything it touches. Medvedev doesn’t want to see that it’s only outside forces — courts, media, opposition, an open society — that can stop the putrefaction which is not only dragging Russia back into its own dark past, but also robbing it of its future.