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Intentions behind the economic reforms in Russia in the early 90s
Up until 1989 Russia was a member of the now-defunct Soviet Union. But with the fall of the union in most eastern European nations, the Russian economy underwent a series of dramatic transformations. The countrys policy of a centrally planned economy was consequently replaced by an economy based on privatization and market forces. After the 1991 August coup, president Yeltsin and his officials initiated an economic reform programme that was bent on cutting government spending and aimed at necessitating a realistic relationship between production and consumption. Bearing in mind that most former Soviet Union nations had already initiated economic reforms, it is easy to conclude that Russia wanted to maintain a considerable hold in Eastern Europe and thus did not want to lag behind. Russia needed consideration for foreign loans and also wanted foreign investment into the Russian economy. In order for this to take place president, Yeltsin had the privatization programme put in place, and by mid-1994 about 70 percent of Russias enterprises had shifted into private ownership.
Political reforms also played a major role in ensuring that Russian gained economic freedom.
The Russian parliament extended powers to Yeltsin for a year to implement the economic reforms in his programme but did this with special agreements from different political authorities in Russias main republics. The economic reforms generated mixed reactions across the whole of Russia. Its GDP had declined by almost 50 percent.
Key economic players such as the light industry, energy, and agricultural sectors were also deeply affected by the economic switch. The majority of Russias workers in lagging enterprises were laid off to facilitate declines in output and consumption.
Vladimir Putins rapid rise to power
Vladimir Putin was a former spy and an officer for the then soviet KGB for 16 years. During pre-election poles, his popularity was evident as about 50 percent of the voters favored him. It is not surprising to know that Putin came from a working-class family with interests in the secret police which lightly explains his career at the FSB, and also as secretary to the Security Council. President Yeltsin liked Putins efficiency in handling delicate matters and Putin himself played a major role in his capacity as secretary of the Security Council, in the firing of the then prosecutor-general Yurii Skuratov, who had shown interest in investigating Yeltsins officials for corruption charges. In 1999 president Boris Yeltsin named Putin as prime minister, having fired Sergei Stepashin.
Vladimir Putins rise to power was mostly facilitated by his strong character and stable background. And although he was extremely popular in his brief stint as acting president, his policies of military use in Chechnya and the revival of heavy security services across Russia I not ogre down well for Russia as a democracy. One can not afford not to note that Putin himself had immense expertise and experience in matters of administration, as was evident when he was in charge of executing presidential decisions. It came as no surprise when Putin whom Boris Yeltsin had hand-picked as his successor gunned 52 percent of the total votes in the ensuing election necessitated by the vacation of office by President Yeltsin Boris.
How the oligarchs got their wealth
The word Oligarch is always associated with businessmen and women who seem to have acquired a substantial amount of wealth(in Russia it also refers to the businessmen who during the privatization period, acquired vast wealth and bought big shares in state-owned corporations). They made connections to corrupt but democratically elected Russian government officials. Relatives of government officials and criminal heads laid hands-on state assets at very cheap prices and in some cases almost free. It is no wonder that even in the present time Russia, Yegor Gaidar, and Anatoly Chubais often stand accused whenever the question of oligarchs arises, probably because they were directly responsible for the Russian privatization during the early 1990s. It is of importance to note that since the Oligarchs had money that generated influence and power, they thus played a major role in the re-election of Yeltsin in 1996. Many Russians will perhaps try to understand how it was possible in the first place, for individuals to plunder their wealth at a time when the countrys economy needed every penny available to facilitate the economic reforms. But in a society where it was almost impossible to transact any legal business without having to pay cartels for protection, and where threats were the order of the day, its impossible for such vices not to bring forth even greater vices, in this case, Oligarchy.
Stability in Russia in the short-term and long-term
We can divide stability in Russia into two topics of discussion, political stability, and economic stability, since both, are needed to ensure the nations GDP growth and also security in general. We can comfortably say that Russia has done so much to improve its political image in the international arena and this has consequently boosted the countrys economy as investors find it a much secure place to invest. However, it can also be said that due to the recent global economic meltdown, most companies took a dive as did the stock market and so most establishments are cutting spending and that includes workers being laid off. With this in mind, the political stage is very delicate for both aspiring and current leaders. Focusing on long-term stability, the recently held elections that propelled Dmitri Medvedev (backed by the former president now prime minister, Vladimir Putin) to power, have shown that Russia has emerged as a stable democracy in Europe. That can and may however be compromised by Russias current poor relationship with the west especially the U.S.A, bearing in mind Russias stand on North Koreas nuclear enrichment where the west perceives Russia as being too lenient to a matter that concerns global security.
The present state of democracy in Russia
In the run-up to the 2008 elections in Russia, democracy in Russia took a new perspective. Key provisions for democracy seemed not to be the top leadership concern; instead, they adopted an almost authoritarian type of governance a thing that on the contrary has a large percentage of local support. The countrys electoral process itself attracts controversy and this can further be debated considering the certainty of Medvedevs victory in the 2008 presidential elections. In the issue concerning former soviet states, Russia always appears to be leaning on those that practice little or no democracy at all. The situation in central Europe also gives Russia the upper hand to claim that democracy is a failure after all, as even the countrys whose ruling parties have democratic ties are seen to be struggling. State corruption is still a major concern as many culprits still remain at large living lavishly abroad. The present state of democracy in Russia can therefore be viewed as very fragile since the government is playing a completely different type of governance seen by many as a rival to democracy.
Reports about Mr. Magnitskii and Mr. Khodorkovskii
Sergei Magnitskii is probably a hero in Russia since his death in pre-trial detention. His death sparked controversy because in his capacity as a lawyer, Magnitskii had exposed top government corruption running into millions of dollars by supposedly Russian untouchables. The list gives names such as; Major Pavel Karpov, Lt.col Artem Kuznetsov in the stealing of over $230 million. News reports also state that Artem Kuznetsov organized and also facilitated Magnitskiis murder. Other than being one of the wealthiest people in Russia, Khodorkovskii is also a known philanthropist. He was arrested on fraud charges in 2003 and 2005 was sentenced to 9 years in prison on account of the same charges. Some observers believe that his trials are politically motivated. Many believe that he will be released in 2011 which is a bleak prediction considering he is currently on fresh charges of money laundering and embezzlement. The majority of Russians living abroad and also organizations are pointing out that he is a reformed Oligarch and that he is now fighting for the rule of law in Russia. Both Magnitskii and Khodorkovskii have something in common; that they are both symbols and examples of how corruption is still a major issue that remains to be addressed. Magnitskii lost his life after exposing corruption in the top state leadership and Khodorkovoskii is suffering and being persecuted for his stand in the rule of law even as he faces a trial that could see him spending up to 22 years in jail.
How the uncertainty about private property rights stimulate state corruption
Private property rights are set to provide for private individuals to own property and to virtually have control over their property. The states role in private property rights is mainly legislative, ensuring that it is functional. When the property rights are not clearly spelled out, then it provides for corrupt individuals and mostly those in powerful government positions to seize public property and be blameless. It happens mostly in third-world countries, especially in Africa. In the early years of Yeltsins presidency, and when the privatization of state-owned corporations was still not understood, greedy politicians seized property for very little payments. It is very important for states to ensure that private property rights are enforced to ensure equality in distribution.
Mafia and corruption in Russia. The Comrade Criminal
The Comrade criminal highlights the growth of criminal activity in Russia after the fall of the Soviet Union. Hotels, banks, and major enterprises are all controlled by gangsters who have elevated themselves to industrial managers. The affiliate themselves to political alliances to gain immunity. The book highlights that corruption in Russia is actually due to its past system of government such as communism. It is also evident from the book that there is the widespread use of violence in Russia and that anyone who stands in the way of these corrupt individuals risks losing his or her life, the same reason why everybody in Russia seems not to mind the widespread corruption. Money generated from these gangs illegal activities is used to finance political aspirants who are seen by these cartels to favor them. The comrade criminal depicts Russias road to corruption and the effects of a society full of vices.
The war in Chechnya
Russia has invaded Chechnya twice in the past years. Whenever there is a conflict and in this case an armed conflict, then for sure there is bound to be anarchy. This provides an opportunity for the same individuals in power to acquire wealth. They take advantage of everyones diverted attention. Corruption in Russia has facilitated terror and this led the war in Chechnya to be prolonged as terrorists exploited corruption as an avenue to make their views heard, especially through mass media. The war in Chechnya in my own view allowed for corrupt officials to transfer money into foreign accounts intended for war provisions.
How to deal with Putin and Medvedev
During his reign as president, Putin used state security to crush little uprisings and with his evident hold on power that came with him becoming the prime minister right after his presidency. Mildly, I would consider his actions greedy and would surely advise the state department to investigate him. President Medvedev is a follower of Putin. His actions against Georgia are questionable as is his aggressiveness. I would recommend without blinking an eye that he be indicted for war crimes.
Political institutions in Russia as compared to those in the U.S.A
For a long time, the US has been a capitalist state where every individual has the right to own any business and operate in an open market. This provides a powerful economy as is evident in the US. This has not been so with Russia. It took a considerable amount of time to make the switch from a centrally planned economy to that of a privatized one. In the US corruption is dealt with decisively but it remains a major problem in Russia. The judiciary and legislative arms of government in the US are properly vetted, and their electoral process is not flawed. Not so with Russia where in recent times an authoritarian system of government is becoming extremely popular.
State corruption a good thing ?
It is absurd to think that any form or degree of corruption can be of any good to the state. I think these are misplaced arguments and should be treated as so. And I cant see a scenario where these arguments get any merit. Corruption defrauds the state of millions of taxpayer money that can never be accounted for.
How social norms of a society depend upon the rules of the game , and upon the equilibrium that such rules produce
Keeping in mind that politics is a dirty game, one should expect the equilibrium to shift each time a new regime comes into power. Widespread corruption in Russia has allowed criminal gangs to control most businesses in Russia. This is due to the poor enforcement of laws that guard citizens against such vices. The situation in Russia provides leverage for Oligarchs to siphon money from state corporations. This explains that whichever rules a new regime introduces determines the states social and economic future.
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