Putin's Plutocratic Rule Continues

In the Kremlin’s gilded throne room of the Tsars to the tune of Russia’s Stalinist national anthem Vladimir Putin was sworn in as President of Russia last Sunday (May 6). Outside the opposition, mainly professional middle class were taking on the police. The Daily Telegraph described the scene.

Placing his hand on a copy of the constitution, Mr Putin swore to "respect and protect the rights and freedoms of the people" and defend Russia's security as he officially took over from outgoing President Dmitry Medvedev.

The eve of the ceremony saw the worst clashes yet between police and anti-Putin protesters when a mass opposition demonstration descended into chaos and security forces wielded their batons to arrest hundreds of people.

Police said that 436 people were detained at Sunday's protest, including the anti-Putin leaders Alexei Navalny and Sergei Udaltsov who now face the prospect of spending at least the next two weeks in jail.

The authorities said that 20 police were wounded by stones and glass thrown by the protesters, who in turn accused the authorities of responding with heavy hand-handed tactics to violently disperse the protest.

The Interfax news agency quoted medical sources as saying that 47 protesters had required medical treatment while opposition websites said that up to 650 demonstrators had been arrested.[1]

Putin has not “returned”. He has never been away. His latest inauguration promises at least 6 more years of a regime notable even by capitalist standards for its corruption and its gangsterism. It is maintained by a hundred or so billionaires (78 in Moscow alone) whose personal wealth accounts for 20% of GDP. Until now Putin has been the lucky beneficiary of high commodity prices but the signs are that this is coming to an end and Russian economic growth is already on the decline.

The Putin phenomenon is a good illustration of the genuine communist position that all capitalist states are class dictatorships where a power that is unaccountable to the mass of the population perpetuates the conditions for an exploiting minority to defend and expand their privilege. The reality is that there are no good capitalist states to defend, no bourgeois faction that the working class can support. This simple but true perspective is the authentic communist perspective, unadulterated by apparently sophisticated but mistaken tactical calls to support this or that supposedly more advanced or less favoured bourgeois formation in the name of anti-imperialism, anti-fascism, or other hotchpotch of positions somehow justifying class collaboration. The true dictatorial face of the bourgeoisie may be better veiled in many other countries than Russia, but it is present everywhere. Not only in the shape of electoral fraud, but also a plethora of parties which agree on all the essentials when it comes to class society, financed by elite interests including those of the trade union bureaucracy, everywhere the numerically insignificant ruling class dominates the political process because it has domination over resources.

The analysis is taken up in the following article from our sister organisation Battaglia Comunista.

The Russia of the Everlasting Putin

The recent confirmation of the election of Vladimir Putin as President of Russia, with 63.75% of the vote, was accompanied, as is well known, by charges of fraud and protests by the various opposition groups.

According to the supporters of the protests, the discrepancy between the actual and official results could be 14%, so Putin, ironically nicknamed (but perhaps not over-ironically) "The Everlasting", by achieving "only"49%, would not have been able to avoid a runoff

Probably, an increasing proportion of the population, especially the small to medium urban middle class, is increasingly impatient with the exercise of authoritarian, or at least not very transparent, power, the purges of awkward candidates, abuse of officials linked to the local president and general control of information.

Even the swapping of the highest offices of state between Putin and Medvedev is considered, as a formal act of an increasingly meaningless democracy though still by a minority of the population. The fact is that Putin – who could not be a candidate again immediately after two consecutive presidential terms (according to Russian legislation), has been in the role of Prime Minister since 2007, leaving one of his most faithful supporters, the young Dmitri Medvedev (who "grew" in the energy giant Gazprom) as President.

However, even in this context, so-called "democratic" opposition forces have shown great weakness, frustrating, amongst other things, the aspirations of the candidates who play the role of bridgehead representing the interests of Washington in Russia, according to the trite formula of the "colour revolutions." Putin's success in the parliamentary elections on December 4, 2011 (tainted by an obvious fraud) has legitimised the new candidate for the Kremlin, the formalisation of a de facto changing of roles (after a failed attempt by Medvedev to go it alone).

However, it is perhaps the economic situation; rather than the problems of incomplete bourgeois democracy, which is stirring the middle class more, in part, created in the Russia of Putin himself. The crisis of 2009, with a GDP contraction of 7.8%, has highlighted the fragility of the economic development of Russia, which in the previous decade (between 1999 and 2008), was expressed in average growth rates between 6 to 7%.

The strong dependence on export of raw materials (especially energy) is the basis of both Russia’s dramatic development (determined by favourable prices) as well as its sudden crisis (due to reduction in demand).

Russia has a wealth of raw materials (it is the State with the largest natural gas reserves, the second in terms of coal reserves and the eighth in oil) and about 80% of exports are represented by oil, gas, natural metals and wood.

Several economists argue that the government has failed to adequately diversify the economy and those social measures that have been carried out are largely due to the redistribution of income from the export of certain raw materials.

The trend appears to be more pronounced in recent years, as oil and gas exports that accounted for a quarter of the budget of the Russian Federal State in 2000, now account for about half the budget.

On the other hand, Russia’s industrial groups are still largely unable to cope with international competition and the majority of consumer goods and technology are imported from abroad.

Given that commodity markets are relatively more sensitive to fluctuations than industrial markets, we can understand how the Russian economy is hugely dependent on foreign markets.

One must also consider the current changes in the energy market, also induced by continued technological development. If on one side Russian oil companies are forced to seek new sources in remote regions of northern and eastern Siberia, where initial costs are much higher, on the other hand the rise in prices is producing new competitors, especially in the Americas (through so-called unconventional oil) a subject that deserves much more space but we'll just mention it here.

The investment climate has also deteriorated steadily in recent years both during the presidency of Vladimir Putin and his term as Prime Minister (a preliminary report by the Central Bank of Russia, trying to make an estimate of the phenomenon, has clearly indicated that 84.2 billion dollars left the country in 2011).[2]

Widespread corruption and an inefficient state, where the state still plays an important role in the management of industrial and financial groups are some of the most obvious aspects that discourage foreign direct investment. Although, in general, in developing economies, investment is 25-30% of GDP, in Russia it only reaches 21-22%. So taking into account the importance of foreign investment and. "Know how" (knowledge) for technological innovation and its retardation, Russian industries can hardly play an important role in the global economy in the short / medium term

Another problem is the obsolescence of basic infrastructure, i.e. roads, bridges, canals, schools, hospitals and gas pipelines, were mostly built during the Soviet era. The construction and proper maintenance of public infrastructure, in fact, declined dramatically thereafter.

The population decline is the eloquent result of the dramatic crisis the country is experiencing and still significantly influences the dynamics of development. According to a report by UNICEF and the State Statistical Service, the infant population in Russia has fallen from 38 million children in 1995 to 26.5 million children in 2008. The general population has declined by 6 million since the collapse of the USSR in 1991, due to economic difficulties, alcoholism and deteriorating social conditions.

It is estimated that the birth rate will not increase significantly in the next two decades due to a reduction in the number of women of childbearing age. In this sense, the aging population, leading to increased spending on pensions, is beginning to worry more than one analyst (it is estimated that by 2030 there will be 9 million pensioners and 11 million fewer workers).

The Russian working class, though not currently living in the tragic conditions in 1990, has only been touched marginally by economic development and you just have to consider that the GDP per capita of a Russian citizen, equivalent to $ 13,650, is still lower than a Greek citizen, equal to $17.710 (and that after five years of heavy recession) to realize just how widespread the current problems in the country are.

In 2010 and 2011, thanks to the crisis in Libya and instability in the Mediterranean countries, which have pushed up oil prices, Russia began to grow, although the growth rate has been only half of that in previous years. Growth continues to be significantly lower than that of the other BRIC countries (Brazil, Russia, India, China: the so-called locomotives of world capitalist development) and insufficient to significantly affect the concentrations of poverty in the country.

The reforms announced by Putin, hoping to attract foreign capital investment, can be seen as an attempt to modernize Russian capitalism that otherwise would play an increasingly marginal role on the inter-imperialist chessboard.


March 30, 2012


[1] telegraph.co.uk 7 May 2012

[2] This is the highest of capital flight of any country in the world according to the Financial Times 7 May 2012 “To Russia with love: how Putin can secure his legacy”

Sunday, May 13, 2012