Monday, November 20
Укр Eng
Log In Register
PoliticsNeighboursEconomicsSocietyCultureHistoryOpinionsArchivePhoto Gallery
9 August, 2012  ▪  Samijlo Vors

When Oligarchs Succumb to Putin

“Ukrainian” oligarchs are responsible for both the current social and economic situation in the country and the dangerous vector of its further development

The scientific definition of an oligarch is somewhat vague; on the conclusion of “scientific communism”, the term has become an emotional cliché, even a curse. However, certain clear components of the phenomenon can still be determined, without having to quote Aristotle, the original author of the term. So “oligarchs” are an inner circle of people, who have a monopoly on the economic resources of Ukraine and directly or indirectly control its political power. It is not difficult to name all the Ukrainian oligarchs, everyone seems to know them, particularly Rinat Akhmetov, Dmytro Firtash, Ihor Kolomoyskyi, Viktor Yanukovych Jr., Viktor Pinchuk, Hennadiy Boholyubov, Kostiantyn Zhevaho, Petro Poroshenko, Serhiy Tihipko etc. In itself, having a billion or so does not necessarily mean one is automatically deemed to be a part of this honorary club. Current conditions dictate that some of the players will gradually lose their influence (and funds!), some will be forced to penetrate government mechanisms, hoping to protect their remaining wealth, while others rapidly strengthen their positions. The latter are the subject of this review.

The frequency of accusations and denouncements against oligarchs gives rise to the suspicion: could it possibly be envy that is the reason for it? So what is lies behind the Ukrainian version of their unique sinfulness? It’s very simple – they not only essentially hamper the country’s development, but also consider the Ukrainian state itself, even in its current “servicing” version, to be counter to their interests. For one thing, Ukraine as a territory, a community and a phenomenon is too European and pluralistic by its geography, history and mentality, to ensure that existing business and political elites will flourish. Individual specific features in biography or up-bringing have nothing to do with it; interests are all that count here. Maintaining the exclusive ruling status of the bosses can only be ensured by an inflexible authority with total control of the administrative structure and law enforcement apparatus, as well as the relative consensus of the population, which is always based on the crumbs from the high table, while those of regular ones, such as one-time “Yuliya’s thousand” or “Viktor’s thousand” won’t cut in. Finally, total propaganda support is vitally important, which effectively thrusts very simple, persuasive values onto the population and blocks alternative explanations of the reality.

None of the abovementioned preconditions are fully met in Ukraine. The hysterical triumph of incapability, demonstrated by the party in power at the beginning of the election campaign is evidence of the lack of reserves of administrative strength. The regime clearly lacks confidence, insolence, drive, creativity… What if they do not manage to fully “readjust”, fool or outbid? Actually, they are likely to succeed, but what if they don’t? A future parliament, that is insufficiently obedient, is a direct and obvious threat of redistribution, in other words, the worst nightmare for the band of olicharchs. It will be impossible to count on the naïve masses, other than possibly in one or two areas (more about this later) – to do so would require more generous sharing, less greed, giving up transporting “surpluses” upstairs and better feed the militsia, internal security troops and the army. Finally it is necessary to decisively clean out the information space, including the internet. What kind of hesitation is this, what disgraceful inconsistency? Having decided to close down a TV channel or a newspaper – do it, without looking back at Europe! Aren’t there plenty of examples? Just look at Ukraine’s northern neighbour, look and learn! What was that? Ukraine is not Russia? That is the point!!!

ROOM FOR RETREAT – MOSCOW HAS THEIR BACK

Some time ago, patriots calmed one another with the reflection that neither the Ukrainian administration, nor Ukrainian business is interested in being dependent on Moscow, since there is no point in them being in one hundred and first place, when they are in first place here.

In fact “Ukrainian” oligarchs have never identified with Ukraine and never protected even its economic sovereignty from the Russian Federation (unlike their own business interests, as was the case with the Russian gas price). But they were and continue to be part of the post-Soviet business elite, which strives to appropriate and take full advantage of the economic resources of the former republics for their own interests, without creating a single new potential for the latter. At the same time, they, together with their families are more often used to living abroad, while their attitude towards the countries where they keep their main funds (by the way, usually even officially registered as foreign investments), is purely utilitarian.

In this existing parasitic model, oligarchs are the tool, ensuring the most effective appropriation of available national wealth with minimal expenditures on the labour force. The scheme is often more difficult to do under the state ownership of certain assets or when the middle class is dominant in the country, as is the case in developed European countries. At the same time, their business empires do not usually have the advantages, that a private entity generally has over a state one: the desire to improve and develop its own assets with an eye to future prospects. The only wish guiding the oligarchs, is to gain as large a profit as possible in the shortest possible time.

If they succeed in this and prevent other representatives of the post-Soviet business elite from entering the market under their control, they oppose their competitors, but if personal benefit dictates the necessity of selling part of their assets, “economic patriotism” is no longer an issue, as confirmed by the active sale of basic assets to Russian oligarchs by Ukrainian ones, namely Serhiy Taruta, Viktor Pinchuk, etc. Even if they get a certain share (though not enough to determine strategy) in the companies belonging to the people they have just sold their own companies to in exchange, this only strengthens their association with their Russian colleagues.

“Ukrainian” oligarchs are not interested in the actual implementation of European business principles, and therefore are not and cannot be a factor in European integration. This is dangerous for them, because it threaten to weaken their positions on the domestic market, based on good knowledge of the “specific features” of conducting business in Ukraine. As for the rest of the points, they are unable to compete with Western transnational corporations and “internal” middle-class business, which would actively develop under European rules. Thus the oligarchs would lose their advantages and monopoly position on many markets.

This is why their “Europeanness” is not greater than that of Russian oligarchs, such as Roman Abramovich or Oleg Deripaska, who tend to display the external attributes of the Western lifestyle, at the same time, in essence, remaining part of the post-Soviet business elite. It actually looks like the perfunctory “Europeanization” of Russian noblemen in the 18th and 19th centuries under the preservation of Asian despotism and serfdom, absence of entrepreneurial freedom and real civil and property rights in the country.

However, the simulation of economic sovereignty from Russia was effective until political uncertainty, economic turmoil and increased public consciousness (at least in several areas), induced by the blatant mistakes of the government, raised doubts about the current status of the “leaders”. In order to maintain their positions, the entities that are the focus of this article are objectively forced to turn their thoughts towards a change of environment. Not at all in the sense of emigration, since several of them already spend much time in cozy Vienna or London, but on the contrary, in the sense of extending the distribution of rules, and ultimately, sovereignty of the neighbouring country onto their historic native land.

Well, why not? Oligarchs are far more comfortable and secure in Russia, if they do not cross certain lines (and where they lie, the lines have been studied and determined by several bold spirits, ranging from Mikhail Khodorkovsky to Telman Ismailov, the rest should simply remain within these lines). In spite of individual protests by several members if the intelligentsia, the overall situation is under complete control. The Moscow regime is supported by the majority of the population, as the results of the last presidential election showed (the authorities obviously added several dozen surplus percentage points for Vladimir Putin, but even without them, he confidently gained a majority of the vote).

This is the reality of today’s Russia. This empire in any of its incarnations is only a specific civilization project, established by representatives of different peoples (including, to tell the truth, our brother, the “khokhol” – Russian slang for Ukrainians). Many years of negative selection, have resulted in such components as a strict hierarchy, willfulness, paternalism, arrogance, irresponsibility, distrust, cynicism under the guise of morals, aggression under guise of a special mission… It is difficult to imagine an environment less suitable for the harmonious development of the economy or society, however it is ideal fertile soil for the ugly forms of power and business that dominate on both sides of the border. Once the border dividing them is removed, there you go – the desired security is guaranteed for many years to come! There is no need to say that in such a case, there is no need for, and therefore the least likelihood of the implementation of such courses as modernization, competition, the transparency of the economy, as well as attendant circumstances, such as the humanization of society, rule of law and the establishment of a middle class is .

When you think about it, there is nothing at all exotic about such an assumption. Moreover we are talking of people who are not overburdened with sentiment. Nothing personal, it’s only business! In view of this vision, it’s possible to reconsider the well-planned efforts of the Party of Regions to implement russification in Ukraine. It’s not about the introduction of Pushkin and Tolstoy to Ukraine. It is rather an attempt to additionally implant Ukraine with the civilization of Nikolai I and Iosif Dzhugashvili (Stalin). Meanwhile its aim (regardless of whether it is conscious or not) is the same: the reanimation and further expansion in Ukraine of the specific, unique type of vertical relations, that first and foremost, a whole generation of Russian thinkers have been wrestling with, ranging from Petr Chaadaev to Aleksandr Gertsen and from Nikolai Berdyaev to Merab Mamardashvili.

As for the masters in the neighbouring country, their only option is to prepare scenarios or just wait for their weak partners-misfits to finally become entangled and give in. The tidbit has to fall into their hands by itself.

MENTAL DEMARCATION

Anyway a relatively new circumstance – not new in essence, but due to how far everything has gone – requires a new awareness and thus new conclusions. This should be required from political forces and individual candidates aspiring to be adequate and desiring to gain a niche in the patriotic part of the spectre. The “sleeping beauty” of our society – the part of regular Ukrainians which is tired of politics, having had no time to find its place in it, should also require this of itself. There is no longer any room for ambivalence. The issue is not about searching for enemies, something that a small group of conscientious outsiders is engaged in, but about real everyday motivation, which will determine specific forms of resistance.

The modern day crisis demands self-determination and the understanding of the fault line in Ukraine, since this line does indeed exist. It does not pass under the ethnicity line in an application form, as in such case, Vadym Kolesnichenko would be considered to be a Ukrainian. It is not determined based on the language spoken by one Ukrainian or another in everyday life. If the primary choice is made correctly, everyone should solve this issue gradually, but almost naturally. An analysis of mass protests against the language law, recently signed by Parliamentary Speaker, Volodymyr Lytvyn, is proof of this.

The demarcation limit is based on a civilization choice, namely between those willing to remain within the mentality of Russia and those choosing Ukraine with all the relevant consequences, namely the European vector, democratic values, free market etc. Either you support the current administration, thus also the old familiar Russian matrix, or in other words, the unlimited power of a cad (ranging from owners of plants, banks, “oblastenergos” and TV channels to district police officers), the preservation of the usual type of relations in the state, business and society, in short, the resurrection of the Empire, also in a literal sense. Or you consider this option to be unacceptable, though it does not protect you from failures, disappointments and defeats, but it still leaves room for your recovery and freedom for your descendants. In this sense, the crisis should be welcomed, since it offers no other alternative, but to wake up and mobilize for action, no matter what civilization choice is made. Thanks to the crisis, temporarily Russian-speaking Ukrainians have the opportunity to feel their interests and find their niche in society.

What about the oligarchs? Firstly, as mentioned above, there are not so many of them now. Anyway it is impossible to cope without big business, especially when it has something in addition to negotiotions and grabbing. If big capital is ready to correlate its strategies with the country’s needs, if it does not hinder competition, including among real foreign investors (not among Ukrainians with Cyprus-based offshores), if it sticks to generally accepted rules of the game, if there is someone able to keep business appetites within the limits of law and decency, then its existence should only be welcomed.

The last word should belong to the regular Ukrainian, as opposed to the “masters of life”, particularly since the former’s chances to be part of the majority are not as vague as some fundamental losers claim. The bifurcation point seems to have been crossed, while, according to the latest polls, the ratio of citizens’ support of parliament’s language innovations was approximately 3:1. In other words, three quarters of those polled do not approve of the new law, which is an illustration of the civilization, as opposed to the language division of the population. All that remains, is for this as yet passive arithmetic to find confirmation in the upcoming elections results and the readiness of Ukrainians to stand up for their right to a future.


Related publications:

  • Mostly discussed for its regulation of the language of instruction in schools, the new law offers more overlooked important innovations intended to change the quality and the content of education in Ukraine
    7 November, Hanna Trehub
  • The new law on the reintegration of the occupied parts of the Donbas qualifies them as such and names Russia as the occupier. Yet, it does not launch the process of deoccupation or change the mechanism envisaged in the Minsk Agreement
    20 October, Maksym Vikhrov
  • This week started off with a bang in Kyiv...and it had nothing to do with working on healthcare reform, which the Verkhovna Rada eventually passed on October 19. The #1 topic became a protest action to push political reforms forward that was called by anti-corruption politicians and former Odesa Governor Mikhail Saakashvili
    19 October, Stanislav Kozliuk
  • Founded this fall, Donetsk oligarch Serhiy Taruta’s Osnova or Foundation party has already started campaigning although the next Verkhovna Rada election is two years away
    18 October, Denys Kazanskyi
  • Russian law enforcers raided the houses of Muslim Crimean Tatars in Bakhchysarai in the morning of October 11
    11 October,
  • The odyssey of Mikheil Saakashvili had a happy ending for him but caused his opponents headaches and image problems
    9 October, Denys Kazanskyi
Copyright © Ukrainian Week LLC. All rights reserved.
Reprint or other commercial use of the site materials is allowed only with the editorial board permission.
Legal disclaimer Accessibility Privacy policy Terms of use Contact us