SocialismToday           Socialist Party magazine

Socialism Today No 80 - February 2004

Capital’s one man state

Vladimir Putin is concentrating more and more power in his own hands. The arrest of big business opponents is one step. Another was last December’s parliamentary elections which gave him effective control of 70% of the seats. The trend is set to continue with the presidential election in March. ROB JONES reports from Moscow.

THERE USED TO be a joke in the former Soviet Union that involved the TV newsreader announcing the results of next week’s elections. Now, after the degradation of society that has accompanied the restoration of capitalism and the growing disillusionment in the ‘democratic’ process, it seems that Russia’s new ruling elite decides in advance how many votes it wants and then ‘manages’ the elections to ensure the desired outcome. December’s parliamentary elections and the coming presidential election reflect the disillusionment of the masses and the cynicism of the ruling elite, which has crudely manipulated the elections into a superficial show, with more in common with the fixed votes of the Stalinist past than with parliamentary elections in Western Europe.

Typical of this cynicism is the horse trading in the duma (parliament) since the election. President Vladimir Putin’s United Russia party gained 37% of the vote on the party list. When the deputies elected on a first-past-the-post constituency basis were added to those elected by ‘proportional’ representation, United Russia was two deputies short of a majority. Since then, nearly 80 deputies from other parties, or elected as ‘independents’, have joined the United Russia bloc, giving it nearly 70% of the deputies, enough to amend the constitution.

To these should be added 36 deputies from Vladimir Zhirinovskii’s Liberal Democratic Party (LDPR), which in every critical vote over the past ten years supported the Kremlin. For the first few months of the new duma at least, Putin will face little opposition pushing through even more draconian laws on trade union rights, ‘reforms’ of pension and housing, and preparation for Russia’s entry into the World Trade Organisation (WTO).

An extreme bout of soul-searching has struck the three parties that did particularly badly. The two neo-liberal parties – Union of Rightist Forces (SPS) and Yabloko – officially gained nearly 9% of the vote between them yet have only half-a-dozen seats because neither party crossed the 5% barrier entitling them to seats allocated on a proportional basis. For the SPS, containing as it does former premiers and senior ministers, this was a particularly hard blow. Two of the best-known leaders, Yegor Gaidar and the oligarch Anatoly Chubais, were premier and privatisation minister respectively in the early 1990s, when they pushed through an extreme Thatcherite programme of mass privatisation of public services. In that period, the ruling elite was directly interested in forcing through the restoration of capitalism using the most radical methods, involving the unfettered opening up of the economy to private ownership. Now, however, the ruling elite is trying to consolidate ownership into Russian hands and no longer sees the neo-liberals as useful to their cause.

Many commentators have argued that SPS and Yabloko would have done better if they had run as a joint bloc. But the two parties have different electoral bases. The Thatcherite SPS appeals to the urban new rich, whilst Yabloka, although it has a neo-liberal economic programme, gets most of its support from urban intellectuals, students, lecturers – the very people losing out most from the neo-liberal ‘reforms’. Meetings to try to decide on a joint presidential candidate failed to reach agreement.

The worst blow dealt during the elections, however, was to the Communist Party (KPRF), which saw its number of seats more than halved. After the previous election in 1999, Genaddy Seleznyov (KPRF) was elected duma speaker. In the first session of this new parliament, KPRF deputies were bluntly told to shut up ‘in accordance with the number of seats’ they hold.

During the campaign, the KPRF complained bitterly about the unfair nature of the election. The mass media, in particular TV, was hugely biased in favour of United Russia. In the last couple of weeks of the campaign, however, Zhirinovskii also featured prominently. This was a conscious attempt to increase the turnout. The people who vote for Zhirinovskii tend to be from a lumpenised section of society, and would not vote for any other party. Yet the LDPR represents no threat to the Kremlin.

The vote gained by United Russia was also inflated by false reporting, especially in republics such as Tatarstan, Bashkiria and Kalmikia where the regime is particularly undemocratic. Several of these areas reported 60-70% votes for United Russia. One of the highest reported votes was from the mountain regions of Chechnya, which are actually controlled by separatists. But the KPRF organised its own count and discovered that, while the vote for United Russia was inflated by three million, bringing down the percentages for SPS and Yabloko (according to the KPRF, Yabloko breached the 5% barrier), the numerical vote for the KPRF was fairly accurate.

The main reason for the drop in the KPRF vote is linked to its failure to offer any real opposition to the Kremlin. Whilst the party is usually described as on the left, it is difficult to draw analogies with Western European left parties as many of its policies are more comparable with those of the European right. It favours a strong state and army, and supports the most conservative policies in relation to the family and national rights. On social issues, such as the ecology, drugs and youth rights, parties such as Yabloko tend to have a much more ‘left’ position. But even within the context of its own policies, the KPRF leadership was particularly stupid in its electoral tactics. With Putin in power and the swing away from pro-Western neo-liberalism to a more state-dominated Russian protectionism, the KPRF found itself in direct competition with the Kremlin for the ‘patriotic vote’. The formation by the Kremlin of the Rodina (Homeland) party three months before the election, led by KPRF fellow traveller and ideologue of protectionism, Sergei Glazyev, and Russian chauvinist and former governor of Voronezh, Dmitrii Rogozin, further cut the potential for a KPRF appeal to patriotism. Yet this is exactly what it tried to do. Social and class issues were pushed to the back and chauvinists and anti-Semites headed the party’s list.

Oil in the machine

EVEN MORE REMARKABLE was the effective sale of several places on the KPRF list to representatives of the oil industry. So when the oligarch Mikhail Khodorkovskii was arrested, the KPRF was seen as supporting these unsavoury businessmen. Unlike the last election when a significant layer of workers backed the KPRF as the main opposition to the Kremlin, there is much anecdotal evidence to indicate that quite a large number of members and traditional KPRF voters either did not vote or were among the 5% or so voting against all candidates.

The Khodorkovskii arrest had a big influence on this election. Arrested for tax evasion, it is also being suggested that he was involved in the murder of local politicians who blocked his business plans in the mid-1990s. Few doubt that he is guilty and his arrest is viewed by many as an attempt by Putin to bring the oligarchs, who ran and profited from mass privatisation, back into line. Khodorkovskii was picked on because of his open financing of SPS, Yabloko and the KPRF in the election. The arrest was a warning to other sections of the new bourgeoisie not to step out of line.

Behind Khodorkovskii’s arrest, however, are even bigger geo-political interests. Khodorkovskii is seen as the most pro-Western of the oligarchs and has a particularly close relationship to the US administration, having been wined and dined by George Bush Senior and Junior, Dick Cheney and Condoleezza Rice over the past few months. At their prompting, Khodorkovskii, then head of the oil giant Yukos, was planning a private pipeline across Russia. Such a project would give control of oil exports to private industry (and the US an alternative to Saudi Arabian oil) and destroy Russian government control over the volume of oil exported. Russia is vying with Saudi Arabia to be the world’s leading oil exporter. A private pipeline threatened to give the US government, through Khodorkovskii’s links to Chevron-Texaco and Exxon-Mobil, effective control over the world oil price and the Russian economy. Immediately after the attacks on Yukos started, the Saudi royal family made its first official visit to Russia for over 70 years, seeing the arrests as a sign that Russia would follow an oil policy independent of the US.

The Rodina bloc made the exploitation of natural resources one of the main issues during the campaign. It is estimated that Russia has 60% of the world’s non-renewable energy resources, including 20% of oil reserves, 35% of natural gas, and 12% of coal. In addition, there are huge reserves of gold, diamonds, platinum and other precious and ferrous metals. In theory, these are owned by the state but the private companies now exploiting these reserves pay hardly any taxes. Rodina, whose proposals were echoed by both the KPRF and United Russia, argues that these companies, mostly controlled by the oligarchs, should pay taxes on the natural resources they exploit. As Glazyev points out, in other countries, such as Norway and Saudi Arabia, oil companies pay up to 80% in taxes. In Russia they pay practically nothing. Glazyev claims that such a tax would generate $50 billion a year, enough to double salaries and pensions within two years. Indeed, claims like this and the general ‘anti-oligarch’ image presented by Rodina enabled it to build its support to 9% of the vote within three months.

Communists split

IN PAST ELECTIONS, Glazyev has been prominent on the KPRF list and originally the leadership wanted to include him this time. But his participation in Rodina helped to squeeze the KPRF vote and the party is now in deep crisis. At its post-election congress, different tendencies vied for position. The conservatives, the Stalinist-Brezhnevite wing who think that the clock can somehow be reversed to the stability and relative prosperity of the late Soviet period, have been losing influence as their supporters grow older. However, they launched an attack on the prominent place given to oil companies on the party list. The Russian chauvinists have seen their position weakened as a result of Putin’s coming to power and his drive to strengthen the state apparatus.

The so-called ‘modernisers’ want to create a newer, more social-democratic type of party. One of the driving forces behind this tendency is Ilya Ponomarov, who was appointed a year ago as the CP’s image maker. Before that he was head of PR for Yukos! Ponomarov’s understanding of social democracy is not that gradually capitalism should be reformed out of existence and replaced by a form of socialism. On the contrary, he believes that big businesses should use a (small) part of their wealth to patronise education, health and social welfare. Already Yukos is widely involved in sponsoring higher education. Indeed, one of the victims of Khodorkovskii’s arrest was the rector of Moscow’s Humanitarian University, sacked for effectively allowing Yukos to take over the university administration.

KPRF leader, Gennady Zhuganov, has attempted to balance between the different wings of the party. Due to the electoral failure, however, his position has become untenable. He will not run as presidential candidate, although he remains head of the party’s duma group.

In the immediate aftermath of the elections, the three main opposition parties (SPS, Yabloko and KPRF) spoke of boycotting the presidentials in protest at the unfair nature of the parliamentary vote. This would have been significant because by law a 50% turnout is required for the election to be valid. Although the boycott could undermine the authority of Putin’s re-election, the very fact that the opposition has been forced to discuss this option is a sign of its impotence in mobilising opposition. Marxists would not normally call for a boycott. If it had gone ahead, however, Socialist Resistance (CWI Russia) would have participated, while explaining the need to build a genuine workers’ party to mobilise real opposition to Putin and his capitalist backers.

SPS and Yabloko, although not announcing an official boycott, have not nominated a candidate. Over the New Year, however, an SPS leader, Irina Khakamada, announced her personal candidature. This was under pressure from the Kremlin to create the image of a real election, and it has been suggested that the Kremlin will help her collect the two million signatures needed for nomination. The KPRF also has backed off from a boycott by nominating Nikolai Kharitonov, leader of the Agrarian Party, as its candidate. The Agrarian Party, mainly supported by the poor and elderly rural population, wavered between supporting the KPRF and Putin, more often the latter, in the previous duma. This means that the three best-known candidates in previous elections – Grigori Yavlinski, Zhuganov and Zhirinovskii, who has passed the gauntlet to his bodyguard – will not be participating. Rodina has so far proposed two candidates, former central banker, Viktor Gerashchenko, and Glazyev, nominations also pushed by the Kremlin. The leader of the upper house, Sergei Mironov, member of the Party of Life, set up by Lyudmila Putin (the president’s wife), and another member of United Russia, the ultra-right, anti-Semitic pharmaceutical magnate, Vladimir Bryntsalov, have also been nominated.

The Kremlin has been deprived of the participation of Zhirinovskii, who could have been used in a repeat of the French presidential stand-off between Chirac and Le Pen in 2002 to frighten people into voting for Putin. With the possible exception of Glazyev, none of the other candidates offer any credible alternative. This makes it likely that Putin will win in the first round if people can be persuaded to turn out. Discussing a possible low turnout, one of the main bourgeois papers, Nezavisimaya, warned that the Kremlin could use special tactics – packing ballot boxes or a ‘terrorist’ act just before the election – to spur people on to vote.

Centralising power

THE OPEN DISCUSSION of these options shows how superficial is the democracy that exists in Russia. In a stable bourgeois democracy there are many different institutions (upper and lower houses, government, judiciary, mass media, police, etc) which all ultimately serve capitalism but act as a check on one another, ensuring that no one person or group concentrates too much power in their hands. But since Putin came to power, the already weak powers held by these other bodies have been steadily whittled away and power concentrated more and more into the hands of the Kremlin. The parliamentary and presidential elections are further steps in this process.

The fate of prime minister, Mikhail Kasyanov, who is seen as being too close to some of the oligarchs in ex-president Boris Yeltsin’s ‘family’, is also under question. He could be replaced by defence minister, Sergei Ivanov, usually seen as a leading advocate of the Siloviki – the armed forces and secret police. If Kasyanov goes, there could be an accompanying change in the way the government is formed. Up till now, the president has appointed and sacked ministers. It has been suggested that in future the government will be made up of representatives of the parties in the duma. Although this appears more democratic, when Putin’s party has 70% of the seats, such a move will make the government even more dependent on his patronage.

Putin has continued to get away with this, notwithstanding signs of growing dissatisfaction, because of the continuing growth in the economy and, consequently, a certain growth in wages and pensions. Official statistics indicate that the economy grew by about 7% in 2003, significantly up from 2002’s 4%. But this is almost exclusively due to the high price of raw materials, particularly oil and gas, on the world market. Nearly 78% of the growth in industrial production has been driven by exports, increases in domestic spending accounts for 15%, and capital investment growth has actually dropped slightly to 7%. Given that Putin and the majority of the Russian bourgeoisie have openly declared that they do not want the economy to be so dependent on oil and gas, it is quite possible that the government will take on board the proposals of Rodina to increase taxes on the exploitation of natural resources.

The economic growth should also be put into context. Gross national product (GNP), which in 1998 fell to 56% of the 1989 level, has now only climbed to about 75%, with industrial production last year on 66%, and capital investment at 36% of that in 1989. Exports are at 184%, imports are still 10% lower. Real incomes are 15% lower than in 1989, but that does not take into account astronomical increases in the costs of housing, transport, education and healthcare. Even if the current growth continues, it will be 2011, 20 years after the coup that smoothed the road to capitalist restoration, before GNP reaches the level it was in 1989! And the cost in human terms, in bloody coups and wars, and the growth of terrorism has been colossal. Demographic research indicates that one million lives have ended earlier than would have been the case in Soviet times, due to the increase in alcoholism, crime, stress and other factors. Male life expectancy has fallen from 65 in 1985 to 58 today. In most countries, a million lives cut sort would be treated as a huge crime against humanity.

Despite this current growth, Russia has not entered a period when things are just going to get better. On the contrary, the ruling elite, by putting all its weight behind Putin, has created a monster that could well come back to haunt it. The workers’ movement is practically inactive, partly because of the economic growth, partly because of repression, and partly because of the lack of any leadership capable of mobilising resistance. But events in the advanced capitalist world and further attacks on workers’ rights and living standards will make it impossible for the working class not to fight back. When that begins to happen, the ruling elite will find that splits will open up, even in Putin’s own party, and its failure to build strong institutions of bourgeois rule will leave it facing crises with a weak and unstable one-man state to maintain control.


State duma election results, 7 December 2003

Party                       list vote (%)  list seats    SMD seats    Total (1999 totals)

United Russia            37.57            120            102                222 (Unity & Fatherland 141)

Communists (KPRF)  12.61              40             12                  52 (113)

Rodina                        9.02              29               8                 37 ( - )

LDPR                        11.45              36               0                 36 (17)

People’s Party             1.18                0             17                 17 ( - )

Yabloko                       4.03                0              4                   4 (20)

SPS                            3.97                0              3                   3 (29)

Agrarian Party              3.64                0              2                   2 ( - )

Others                       11.56                0              6                   6 (16)

Independents                                                    68                 68 (105)

Against all                    4.7                                 3                   3 (9)

Duma seats are divided into 225 seats allocated to parties gaining over 5% of the vote on the party lists, and 225 going to individuals elected to single member districts (SMD).

United Russia was formed by the merger of the Unity and Fatherland-All Russia parties in 2001. In the 1999 election Unity won 23.3% (73 seats), Fatherland 13.3% (68).

Elections for the three seats down as ‘Against all’ have to be re-run (14 March). In these districts, the number of votes ‘against all’ exceeded the votes for any one candidate.


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