Russia’s atomized citizenry and dysfunctional economy are often blamed on a unique national psyche. Yet the social breakdown in modern Russia is best explained in terms of its recent history, and the Soviet leadership’s failed response to its crises.

People walk in Nikolskaya Street outside Red Square in central Moscow on September 28, 2022. (Natalia Kolesnikova / AFP via Getty Images)

Elena Kostyuchenko’s I Love Russia: Reporting From a Lost Country collects over a decade of chronicles on the country’s decay into what the author calls fascism. Armed with the selfless courage and uncompromising journalistic style to be expected of a contributor to Novaya Gazeta, the newspaper effectively censored since 2022, Kostyuchenko describes the personal, social, and political environment of modern Russia.

She takes us from settings as varied as abandoned hospitals squatted by teenagers in Russia’s urbanized central plain, horrifying psychoneurological boarding institutions for children with mental illnesses in the south, and bombed-out Ukrainian cities on the front line. The variety of subjects and geography conveys Russians’ universal experience of being doomed to violence, criminality, official abuse, and decay.

This dehumanization culminates in the psychoneurological boarding institutions — the subject of Kostyuchenko’s chapter arguing that Russia “has been fascist for a long time,” even before the war in Ukraine. There, “child residents,” stripped of their legal standing, are left to live and die in complete isolation from society and the rule of law under the control of staff who punish any questioning of authority and practice forced abortions and sterilizations.

The book is marketed to a Western audience as revealing the “real Russia” behind the facade of its international grandstanding and Moscow’s modern cityscape — an illusion of Russian power that the author considers widespread in the West. We learn that, faced with an either violent or careless, but anyhow systematically corrupt, state apparatus — the police, the army, social services, private security — abandoned individuals, surrounded by atomized and fearful others, are left to despair, in turn fueling an omnipresent apathy and mistrust. Yet in truth, this portrayal merely confirms the contemporary Western prejudice toward all things Russian. The book is full of familiar clichés of the criminal government oppressing a deplorable coalition of miserable babushkas and alcoholic hooligans.

The Russian elite’s perspective misses how much Russia has become peripheral to the world economy in the last thirty years and is in fact perceived in the West as backward.

The book believes that it is touching upon a hidden reality because it buys into the Russian elite’s nationalist self-perception that it heads a modern state, or, as Putinist propaganda would have it, Russia has not lost its international standing. Yet, this elite self-perception is only partly delusional. The remnants of Moscow as the former core of the communist world ensure it an appearance, and something of the societal composition, of a core country of the world-system.

Yet the Russian elite’s perspective misses how much Russia has become peripheral to the world economy in the last thirty years and is in fact perceived in the West as backward. This demands that claims about the contemporary reality of Russian society address the country’s duality: on the one hand, Russia is a low-productivity exporter of natural resources inside the periphery of the world economy, but at the same time it is a modern nation-state with a large bureaucracy and an intellectual and cultural sphere unseen elsewhere in the periphery.

In other words, the lack of understanding of Russian society, reflected in “either/or” assertions about its modernness or backwardness, is linked to its peculiar position in the global economy. As a result of this unique duality, Moscow is not only the center of an internationalized service and financial industry providing for the natural resource export sector and the domestic distribution of the ensuing economic bounty (as, for example, are Mexico City, Astana, or Baku), but also the political, cultural, and — ultimately — economic and financial center of this former otherworldly hegemon.

So, it is true that, in attempts to challenge the West’s centrality to the contemporary world-system, Russia plays a role that today lags far behind China. Yet, it is still disproportionately influential in the international scene in comparison to its position and the size of its economy (more of the order of Mexico than other giants such as Brazil and India). In sum, although Russia became peripheral, it retained some of the modern bureaucracy and the cultural and diplomatic gravitational force it once had in the pro-Soviet communist world. This explains why Russia’s international role is disproportionate to its stagnant economy (a position, however, in a progressively deepening crisis, particularly with the break of its biggest client, Ukraine).

From Apathy to Violence

Among the few significant attempts to provide sociological explanations of contemporary post-communist societies is Gil Eyal, Ivan Szelenyi, and Eleanor L. Townsley’s Making Capitalism Without Capitalists. It explains such societies’ diverging political and economic paths through the amalgamation of capitalist and bureaucratic power (or the lack of it). By focusing on the processes of appropriation of economic means of production, they describe how, in Central Europe, the extent of foreign capital penetration defeated any possibility for an indigenous criminal bureaucracy, replacing it by a so-called “comprador” professional elite that serves foreign capital.

The Russian capitalist and managerial class was created out of a certain kind of people: the bureaucratically connected criminal vultures who fed on economic destruction.

In contrast, Russian capitalism emerged from the spoils of economic privatization, whereby bureaucratic and economic managerial power became amalgamated. This happened in a context of rapid devaluation of household savings because of hyperinflation, when, in 1992, exchangeable coupons (vouchers) were distributed among the population, allowing people to buy shares of former state companies in public auctions.

But managers of such companies, and the people connected to them, were the only people with access to information on the value of such companies and the ones in charge of auctioning those shares. While households were happy to exchange their vouchers for little, managers massively self-auctioned the property of those companies for ridiculous prices.

Moreover, in 1995, an incredibly unpopular president, Boris Yeltsin, implemented the “loans for shares” program: the Russian state would borrow money from Russian capitalists enabling it to pay wages and pensions, in the hope that this would secure Yeltsin’s reelection in 1996. These capitalists had previously bought the main banks: Vladimir Potanin’s Oneksimbank first started managing the Russian Foreign Ministry’s transactions.

Oneksimbank, the most significant provider of loans in 1995, managed the auction for Norilsk Nickel, the world’s largest nickel producer whose annual profits totaled $400 million in 1996. After a $355 million bid from Rossiyskiy Credit was turned down by Oneksimbank, a subsidiary of the very same Oneksimbank bought Norilsk Nickel for $170 million.

Similar processes were used by Vladimir Gusinsky (MOST bank), Mikhail Khodorkovsky (Menatep Bank), and Mikhail Fridman (Alfa-Bank). These loans, far exceeding the state’s fiscal capacity, were repayable through the auctioning of shares of the most profitable Russian businesses, those in charge of exporting natural goods such as oil, gas, and nickel. Despite financial help from these criminal entrepreneurs and the United States, it still took massive election fraud for Yeltsin to win the 1996 presidential election by 54 percent.

Hence, the Russian capitalist and managerial class was created out of a certain kind of people: the bureaucratically connected criminal vultures who fed on economic destruction. Romania, Bulgaria, and post-Yugoslavian states experienced this to a smaller degree, being progressively integrated into Western-based capitalism, as their comparative economic advantage rested in cheap and poorly protected labor, weakening the opportunities for the indigenous bureaucracy to distribute spoils amongst itself. Belarus is the notable exception, as marketization and privatization were strongly limited, political power remaining supreme without needing to criminally appropriate economic sources of power to the same extent.

This amalgamation of the political and economic spheres illuminates not only the emerging form of Russian capitalism, but also the omnipresence of violence and corruption, albeit constrained. Apart from specific technologies originating in the military-industrial complex (i.e., rocket launchers and information technology), the Russian competitive advantage largely rested in large infrastructure of oil and gas transportation.

In cases where the comparative economic advantage lied in the export of gas and oil (Russia, Kazakhstan, Azerbaijan, Turkmenistan), massive metals (Tajikistan), or in the control over forced labor (Uzbekistan), political control over crucial infrastructure conditioned economic rent. This ensured the state ultimately has the upper hand, but also made political change impossible, unlike in countries with no significant comparative advantage and competing business interests (Moldova, Ukraine, Georgia, Kyrgyzstan).

This dynamic points toward an explanation for the omnipresence of violence and corruption. But the predominance of the state also explains why overall levels of erratic violence in Russia are lesser than, for example, in Latin American countries such as Colombia and Mexico, where comparative economic advantage lies in the anti-infrastructural capacity of drug producers and smugglers. There, economic power dominates the bureaucratic one, even tolerating the exchange of political power, so long as it does not have too much effect.

Backwardness of an Undynamic Economy

This sketch of the unique form of Russian capitalism helps us to see how the state-controlled economic rent allowed Russia to concentrate wealth in Moscow — where not only a significant service and financial sector grew to serve it, as in other natural resource export capitals (e.g., in Baku) — but also how it allowed capitalists to finance the impoverished bureaucratic, diplomatic, intellectual, and cultural remnants of its former central position.

The economic backwardness of large areas of non-Moscow Russia arises out of the last decades of the Soviet Union.

This development in the Russian capital, however, accounts for an ever-growing contrast with the backwardness of the rest of the country — a backwardness that rests in its undynamic economy and peripheral place in the world economy.

This economic backwardness arises out of the last decades of the Soviet Union. From the Bolshevik period the Communist project had always been seen as a modernization process, ideologically understood as an inherent part of workers’ and peasants’ emancipation. Under Joseph Stalin, this aim of modernization served the purpose of the state: to establish a world-level military-industrial complex.

The costs of this process were borne by the most productive Soviet agricultural regions: the eastern Ukrainian plain and the Kuban steppe. In addition to being used by the Stalinist regime to crush the Ukrainian and Cossack peasantry through forcing mass famines in those regions, the high-level resource extraction by the Soviet state served to ensure exports financing capital imports to build this military-industrial complex.

After Stalinism, Nikita Khrushchev’s model of development aimed at raising living standards, particularly urban ones, through the expansion of the service economy, housing construction, and increased consumption. However, already in the late 1960s lagging productivity prompted the state to implement reactionary land distribution policies in favor of urban workers to enable them to produce desired agricultural products (kielbasa, eggs, fruits, vegetables, etc.) for their own consumption and small barter trade. Such de-marketization and familialization marked a break from the Communists’ modernizing ambitions; the failure to (re)dynamize the productive system led, in its turn, to Mikhail Gorbachev’s economic restructuring (perestroika).

These reforms reinforced the independence of the managerial class, which became the main beneficiary of the last attempt to (re)dynamize Russia in 1991 through the introduction of the shock therapy of mass privatization and trade and price liberalization. This liberalization and deregulation of prices severely affected the uncompetitive Russian industry and devalued Soviet households’ savings. But the policies nurturing self-production partly compensated for shortages, unemployment, and low or even unpaid wages and pension entitlements after the transition to capitalism.

The individualization of economic lives, reinforced by Vladimir Putin through the adoption of low flat-tax rates in 2001, did compensate for economic stagnation and the government’s permanent austerity in the rest of the country. There was a growing contrast between these regions’ realities and the consumerist expansion of Moscow (and, to a far lesser extent, St Petersburg) after the 2000 rise in oil prices and associated rises in the finance and service industries.

However, this history of the transition to capitalism reinforced the existing trend of social atomization by destroying existing institutions of politicization and socialization such as the Communist Party and trade unions, without replacing them with anything else. It thus led to the formation of a particularly strong social atomization and the spread of highly moralized attitudes, such as increasing belief in the importance of Orthodox values and identity, despite continuously declining rates of religious practice.

Despite the strong amalgamation of the “political” and “economic,” the Russian case only apparently contradicts Ellen Meiksins Wood’s thesis of their separation into different spheres of operation with the advent of capitalism. While in late twentieth-century China, the Communist Party led by Deng Xiaoping introduced capitalism as an instrument for reorganizing the economy on more dynamic bases while never allowing real capitalist autonomy from political imperatives, in Russia the organizational and symbolic separation between the two spheres was central to the abandonment of modernization ambitions and a decadeslong embrace of austerity.

Indeed, while discontent toward the Soviet failure to raise living standards from the 1970s onward led to its crisis and ultimate doom, the current government avoids responsibility for living standards by offloading economic progress onto market forces and families.

Russians Don’t Have an Inbred “Authoritarian Essence”

The proliferation of a confused analysis of Russia’s political intentions (especially since the beginning of the Russo-Ukrainian conflict in 2014) — both in mainstream international relations scholarship and on the Left — calls for a more serious critical mapping of the historical and materialist roots of Russia’s trajectory.

Novaya Gazeta journalist Kostyuchenko’s book surely provides a convincing rebuttal of Russian nationalist self-perception and propaganda. However, her depiction of Russian backwardness should be understood with reference to the peculiar international position of Russia that results from its modern history, as against an enduring Anglophone depiction of Russia as the transhistorical and essentialized epitome of an authoritarian government.

The explanations for Russia’s contemporary situation should be sought in the processes resulting from the Communist Party’s bureaucratic responses to economic and societal stagnation.

For an example, we need only look to Timothy Snyder, the famous US historian of Eastern Europe. While clearly correct in pointing out that Russia has an authoritarian government, he is nonetheless unable to explain the emergence of such a state of affairs other than through the psychology of Vladimir Putin. Such explanations fit liberal pundits’ worldview that rejects materialist historicization, favoring psychologized explanations grounded in the supposed authoritarian and imperialist “Russian essence.”

For instance, referring both to Stalin and Putin’s crimes against Ukraine, Snyder limits himself to the psychology of the Soviet and Russian leaders, as he assumes their acts are driven by an internal “great Russian” imperialistic urge. Similarly, while explaining the contemporary Russian government, Snyder focuses on marginalia such as Russia’s cyberattacks, Internet propaganda, and provision of financial support to European far-right parties while missing the long-term tendencies of economic stagnation and the more recent amalgamation of economic and political power, which explain the Russian government’s evolution.

So, the explanations for Russia’s contemporary situation — the corruption of its bureaucracy, the apathy of its citizens — should be sought in the processes that arose from the Communist Party’s bureaucratic responses to economic and societal stagnation, and the economic and political conditions in which the transition to capitalism took place.

Amongst those responses, the embrace of a supposedly free-market economy since the 1990, and the failure of the latter to uphold even the standard of living of the last decades of Communist management, must be taken as important factors in explaining the contemporary lack of dynamism of the Russian economy and the ensuing social atomization. The fusion of economic and bureaucratic power in Russia, resulting from mass privatizations, has enabled the emergence of a violent government comfortable with such stagnation.

From our sketch of this specific political economy arises a particular political sociology, probably unique to Russia. Indeed, Russian society is a combination of elements related to the export economy (with its distribution of rent), of the state bureaucracy it retained from its former centrality (sustained by the rent but impoverished by the infernal and never-ending austerity system), and of an undynamic and significantly de-marketized economy.

Taken together, these lasting trends dispel the psycho-cultural explanations (finding causes of economic backwardness in Putin’s craving for power) as well as essentializing ones (“Russia is authoritarian by nature”), while giving us a better explanations of the omnipresence of violence, corruption, and apathy in Russian society.

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