The Russia Conundrum

Russia today is run by what can best be described as a neo-feudal model where the regional elites, Putin’s placemen, undertake to provide votes and revenue for the centre and in return get a free hand to run the finances of their region as they see fit. To be more precise, these elites have free rein to pursue personal financial incentives and the Kremlin turns a blind eye, so long as it receives its cut. The mechanism goes something like this: 60 per cent of the revenues that are collected from the population go to the centre, which leaves 40 per cent for the region’s spending. But that isn’t enough to keep the regional elite happy, so the centre then funnels them another 10 to 20 per cent of the money (in the case of Ramzan Kadyrov in Chechnya, the figure is more than 90 per cent of the regional budget) in return for their unwavering loyalty and political support.

That’s one mechanism that the Kremlin uses to maintain its grip on the country. Another is to make sure that all officials are forced to take bribes. If you don’t take bribes, the centre simply removes you from power. And if your loyalty at any point starts to waver, they have evidence of the previous bribes so they have a cast-iron criminal charge on which they can lock you up.

There is also a third mechanism that Putin uses, which involves the maintenance of a shifting balance of power between groups of officials whose interests may potentially conflict. The central economy continues to be administered by the so-called liberal group – they are by no means liberal, but that’s what it has become accepted practice to call them. On the other side are the Siloviki – the people from the military and enforcement agencies. The Siloviki are constantly in search of money, so Putin plays a game. On the one hand, he instructs the liberal group not to give one kopek more to the Siloviki. On the other hand, he complains, I’m barely holding on to them, these guys are champing at the bit. From time to time the two groups lock horns and the odd one of them is sent to jail. At other times, Putin sets sub-factions within the Siloviki against one another, with similar results.

Putin needs these Machiavellian mechanisms to maintain his grip on the system, to prevent the administrative machine falling apart. He needs to do things this way because Russia under his rule does not have the formal structures and institutions that usually keep societies functioning properly, with civic integrity and the rule of law. Apart from the fact that this makes Russia look like a third world country, it also creates a potentially very dangerous situation. This is because the continued existence of the whole Byzantine apparatus depends exclusively on Putin being there to keep pulling the levers. If one were to remove Putin from the equation, the system would lose its equilibrium and the country would enter a catastrophic state of clan fragmentation. This, of course, is no accident: Putin has arranged things that way with the deliberate intention of making it impossible for him to be removed.

How many people are there in today’s Kremlin mafia? It’s hard to give exact figures, but at the top are Putin’s favoured associates, made up of people like Igor Sechin, Gennady Timchenko, Arkady Rotenberg, the brothers Yuri and Mikhail Kovalchuk, and Nikolai Patrushev. I will say more about most of these in a moment. But there are also further circles, including the ‘overseers’ in the presidential administration, such as Putin’s chief of staff, Anton Vaino, and his deputy, Sergei Kiriyenko; and the top guys in the FSB, Alexander Bortnikov, Sergei Korolev, Ivan Tkachev, Alexei Sedov, whose job it is to persecute the political opposition, and Oleg Feoktistov, who is nominally retired, but is still hard at work. Then there are the regional bosses, men like Alexei Dyumin and Sergei Sobyanin, who do the president’s bidding in big cities and regions; plus, of course, the Kremlin’s ‘oligarchs’, such as Alexei Miller at Gazprom and Andrei Kostin at VTB Bank; and the heads of some courts, certain judges and the directors of the Investigative Committee and the Prosecutor’s Office; and, finally, their henchmen who do the dirty work.