How Russia Became Ruled By Corruption And Vladimir Putin

President Vladimir Putin (Platon/Trunk Archive)

How Russia Became Ruled By Corruption And Vladimir Putin

Chapter One: The Fall Of Soviet Russia And The Rise Of The Kleptocracy

A Five Chapter Trump-Russia Saga

Should you ever find yourself leading an army and your plan involves an invasion of Russia that could stretch into the winter, conventional wisdom says it will be the end of your campaign. For over a thousand years, no one who tried to conquer Russia has succeeded. Even the Mongol hordes grew frustrated and retreated after more than two centuries of raids. French and Nazi armies quite literally froze to death, unable to pierce the Russian blockades as they were forced to march back through terrain scoured of anything they may have found useful for survival.

Russia dwarfs every other country on Earth, taking up nearly one sixth of all land. Its 6.6 million square miles of plains, mountains, and frozen wilderness spread over 11 time zones, borders 13 other nations directly, and one more across the Bering Strait. Invading forces would have to fight through almost the combined land area of the United States and Canada against close to a million active duty troops and twice as many reservists.

Today, even after the loss of its satellite states and the implosion of the Soviet Union, Russian military might is still quite formidable. During the conflict over South Ossetia in 2008, Russia casually overran Georgia in days and left only thanks to global involvement in mediating a ceasefire.

And this is not to mention a terrifying arsenal of nuclear weapons which can end the world several times over, along with its long rumored doomsday machine known as Мертвая Рука, or Dead Hand. Thought to be controlled from an underground base in the Caucasus Mountains, this mechanism may be the concept of Mutually Assured Destruction made manifest.

You would think that with all this territory, military might, resource rich lands, and a highly educated workforce which excels in math and science, Russia should be a prosperous nation with nothing to fear. Instead, it’s a deeply paranoid kleptocracy that’s been more or less static for the better part of 30 years.

Many of its older citizens are still shell-shocked from the events of 1991, and that’s entirely understandable. Going to bed in one nation to wake up in another, knowing the country where you were born no longer exists gives you emotional whiplash, to put it mildly, as does learning that much of what you were told growing up were lies.

Some scholars see its chronic malaise in the context of the end of the Soviet Union and treat it as a slow motion dissolution of the world’s largest empire. Others see it as a promising country paralyzed by avaricious leaders who operate beyond and above the law. And its own political dissidents see it as a broken country unable to put itself back together because all those capable of doing so have long left, frustrated by the stubborn elders in charge trying to right the ship long after it sank, or scared of the crime waves and hyperinflation that followed.

The Birth Of The Oligarchs

This is not what was supposed to happen. Instead of spiking the football after winning the Cold War, Americans sent help. Consultants flocked to Russia and ex-Soviet republics to aid in a soft landing and start fixing endemic problems.

But as the years went by, corruption spiraled out of control. State assets were sold off to families and friends of bureaucrats tasked with starting the privatization and modernization of industries that trudged along under the Soviet iron fist. The benefactors of this process were called the New Russians. Their wealth exploded, and anyone who stood in their way was taken down by organized crime figures they paid while authorities looked the other way and whistled, also on the dole.

Journalists who exposed ties between famous business owners and criminals routinely found themselves face to face with contract killers dispatched to their homes, or to intercept them during their commutes. None would be caught and no one seemed to have much interest in doing investigations in the first place.

Meanwhile, the police would stop getting paid for months at a time in the chaos, and would accept bribes to stay alive, ignoring criminals consolidating their empires, if not outright enabling them at the highest levels of government.

In a particularly egregious example, Russia’s equivalent to the Attorney General, Yuri Chaika, protected his sons’ criminal empire that spanned across Russia to Switzerland and Greece, using his connections to make sure they could hijack and extort companies without fear of police interference. This extortion could range from hostile takeovers with shady money and sketchy legal documents, to murder. The saddest part of all this was the fact that what they did was in no way unique to their operation. They were the rule, not the exception, in how Russia turned itself into a kleptocratic state.

As Yeltsin drank himself out of a job in the mid-1990s, touring Russia and preaching the virtues of capitalism and democracy, and how well the country would be doing after throwing off its Soviet shackles, he met ever more disgruntled crowds. They weren’t getting paid, their friends doing shady things were getting rich, and no one seemed to be in charge.

President Boris Yeltsin handing over the presidential copy of the Russian constitution to Vladimir Putin in Moscow, December 31st, 1999

President Boris Yeltsin handing over the presidential copy of the Russian constitution to Vladimir Putin in Moscow, December 31st, 1999

Accepting defeat, he installed Putin in his place on New Year’s Eve in 1999 and resigned. Rumors said he was pushed out in a silent coup engineered by Putin, but according to those close to him, Yeltsin was simply done. His health was failing, he didn’t want the job anymore, and fell into despair as his country kept imploding.

Putin Brings The Oligarchs To Heel

Putin’s ascension took place when businessmen were becoming the oligarchs we know today, mixing business and politics in questionable, yet very effective ways. One such oligarch, Vladimir Gusinsky, used his cash to fund a channel called NTV. It was highly critical of Putin’s handling of Russia and the war in Chechnya, which was filled with chilling human rights abuses that still haunt the nation. One of the ways he needled the new president was with a satirical puppet show called Куклы, or Dolls. In it, dolls of various government officials went through setups that revealed their well-known and glaring shortfalls.

In one episode, Putin is awakened by one of his subordinates and told that he was no longer the president of Russia, but the role would instead be assumed by Bill Clinton because a cabal led by the UN and NATO determined this was for the best. He tries to negotiate his way out of this with little success, finally broadcasting a message encouraging Russians to defend their government, otherwise “everything will be taken, from your right to ‘rub out’ Chechens, to be friends with Saddam, to being able to drink on the job.”

It was quintessential Putin as he had come to be known. When facing an internal crisis of confidence and external pressure, he rallies the troops with patriotic propaganda and whipped up existential threats that tied his fate to the fate of the country and its citizens.

Within just a few months, Gusinsky suddenly found himself under investigation for tax evasion, had his offices raided in a show of force, and was ultimately exiled to London. NTV was sold to more compliant oligarchs and instead of Куклы, the political commentary took place on a 3D animated show called Тушите свет!, or Turn Out The Lights, with a much lighter tone, rarely mentioning Putin or his inner circle.

Putin’s approach to domestic matters seemed guided by the Russian expression “the czar is fine, it’s the boyars who are the problem” and while criticism of local bureaucrats and the poor conditions for the typical citizen were fair game, he wasn’t. Why? Because he was the fixer who would reign in corruption and revitalize the economy, as Gusinky’s show trial was supposed to prove to the public.

Instead, Putin used tax evasion and embezzlement charges to bring unruly oligarchs to heel and consolidate his power. His rough treatment of Mikhail Khodorkovsky was a prime example.

Humiliating one of the wealthiest men in Russia, forcing his company into bankruptcy, then in a rigged contest auctioning off what was left of it to front companies for Rosneft, created the template he would use to crush all his enemies. Those who cooperated got seats in the Duma, governorships, and government contracts. As long as Putin and his inner circle were in on the scam, it was fine. High oil prices also allowed him to start noticeably improving living standards across Russia, sending his popularity soaring.

Making Russia Paranoid Again

Corruption was organized at the highest levels and critics were systematically silenced with astro-turfed skepticism or violence. Oligarchs who didn’t go with the program got the Gusinsky and Khadarkovky treatments, their assets sold off in sham auctions to shell companies which were eventually absorbed by banks, oil and gas companies, and sprawling enterprises ran by his friends and loyal allies.

Slowly but surely, Russia institutionalized bribery, racketeering, and fraud, with the largest spoils going to the most senior officials.

With his power inside Russia now consolidated, Putin began to look outward and did not like what he saw. NATO and the EU were expanding across Europe. In his mind, it was an army massing on his wide, vulnerable Eastern border led by the United States and its proxies: UK, France, and Germany. On Russia’s Pacific Coast, South Korea, the Philippines, and Japan had close alliances with an aggressive United States that left Russia out in the cold.

Cyprus, one of the top places for Russian oligarchs to stash their cash, kept trying to go its own way even if it hurt their Russian holdings. In response, it seemed prudent to keep expanding its naval base in Tartus for easy access to the Mediterranean, just in case force projection was necessary to secure his and his friends’ holdings. Unfortunately, the civil war in Syria and the rise of ISIS threatened this asset as well, while Americans are mulling stepping in to help pick a winner. This would not do.

A cartoon depicts the US and Israel as Death knocking on the Middle East and Egypt’s doors

A cartoon depicts the US and Israel as Death knocking on the Middle East and Egypt’s doors

Over time, state owned media started fanning anti-Western conspiracy theories, which painted European and American liberalism, which went hand in hand with IMF loans and was often promoted by many helpful NGOs, or private non-profits consulting on social, medical, and economic reforms, as a way to manipulate Eastern Europe.

According to Putin’s pundits, the EU and the US talked a big game about rights, freedom, and cooperation, dangling what looked like amazing deals for underutilized Eastern European economies. But the reforms these leaders had to agree to would make them puppet states of Washington and Brussels.

Russia pitched itself as much better alternative. Help it move gas and oil across Europe, get a few billion dollars when you need it, no questions asked, no reforms necessary, you just keep doing you.

When Ukraine was considering a trade deal with the EU, this is exactly how Putin sought to counter the offer, and he fought hard to undermine the talks because he seemed sure that if Ukraine joined the EU, it would also join NATO, bringing a hostile army right up to one of Russia’s longest Eastern borders, and give it the ability to invade on a whim.

The nation, in Putin’s mind, needed its Eastern European buffer back. NATO and the EU had to be sent to retreat as not to entice its former satellites and give them an option to say no in negotiations. The US needed to be scaled back in the Middle East and the Pacific.

And the sanctions slapped against him when he tried to annex Ukraine? They had to go. With oil now crashing, he could no longer sustain the spending spree that marginally improved his citizens’ lives, and his friends were having trouble laundering their money. Putin had to step up his game in foreign policy and asymmetric warfare. But there’s an important twist to consider. By rallying the oligarchs under his command, his foreign policies were tied to their interests abroad…

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