Business Watch
Patrick Armstrong
Transparency International's Russian corruption ratings at variance with other indicators
By Patrick Armstrong
CORRUPTION: IS ANYTHING REALLY HAPPENING? I recommend reading our discussion. But, if you don’t read the whole thing you must read Anatoly Karlin’s entry: all we ever hear is that Transparency International puts Russia near the bottom. But other ratings contradict its: Karlin names them, gives their scores and discusses about the implications. His conclusion is that Russia is pretty much at the world average. Myself, I don’t take these ratings on Russian corruption, press freedom, human rights or anything else very seriously because they’re all too affected by the prevailing memes and I suspect the motives of most of the raters. But Karlin’s point is that TI’s ratings fit poorly with other indicators. Russia is certainly very corrupt but 133rd worst? I doubt it.
Corruption continues to dominate Russian news
by Patrick Armstrong
Corruption. Well, there sure are a lot of investigations going on and they reaching levels within sight of the top of the power heap: after all Serdyukov was appointed by Putin who stuck by him for years against the resistance of the generals. This blog entry enumerates some of the biggest corruption investigations: it mentions the Defence Ministry property scandal (the new Minister has just fired another official, but probably not for that connection); RosTelekom; a former Agriculture Minister; GLONASS; a big one in St Petersburg and a swindle in Perm Region. Kommersant estimates the total bill at 57 billion rubles (about US$1.8 billion). And maybe more from the Defence Ministry: there are reported to be 60,000 empty apartments for military retirees. A fraud case has opened in Yekaterinburg. Arrests for mistreatment of convicts and perhaps more coming after the prison riot in Chelyabinsk last month.
Russian Sit Rep - Corruption gets top billing
Corruption. The OboronServis scandal expands with former Defence Ministry official (and, some say, former Minister Serdyukov’s girlfriend) Yevgeniya Vasilyeva charged with large-scale fraud and placed under house arrest. A spokesman for the Investigative Committee said that companies controlled by the Ministry had embezzled more US$250 million this year; not, it appeared, just from this particular swindle. No charges have been laid against Serdyukov but they may be coming pending investigation. It is also reported that the new Minister has so far brought with him 14 senior people from his previous jobs which suggests that he wants people around him whom he can trust to be clean. In other investigations a case has been opened against two military officers in the Far East for embezzling ration money; a former officer of the Federal Drug Control Service was sentenced to jail for drug trafficking and an ex-FSB officer was arrested for fraud. We’re definitely touching the organs of state security here. Stay tuned.
Russian businessman under pressure
This is a summary of Patrick Armstrong’s article which appears on Russia: Other Points of View complete with hyperlinks to all sources.
Pressure. A prominent Russian businessman says he will sell all his assets in Russia and retire so as to end what he calls “relentless pressure from the authorities”, specifically from “Directorate K of the FSB.
Russia: when one door closes, another opens
Syria et al. Whenever something horrible happens in the world that Western governments and media outlets actually notice, we find two different reactions from Moscow and Washington. Moscow confines itself to anodyne statements about constitutional agreement, peace and so forth – admirable sentiments which do nothing. Washington, on the other hand, feels it has to pick a side and blame those that don’t. US media outlets either create this judgement or follow along (which comes first?). Washington then accuses Moscow (and others) of preventing it “doing something”; the media picks up this line and fills up with stories (many of which don’t prove to be true: this one again, for example).
Putin-Medvedev first moves linked to anti-corruption
Vorstand reshuffle. Putin was inaugurated on Monday and, as promised, immediately nominated Medvedev as PM. He was confirmedby the Duma the next day (Communists and Just Russia voting against). I was intrigued by their first reported actions: Putin ordered the creation of a business ombudsman to defend “the rights of entrepreneurs” showing that improvement of Russia’s business climate is a high priority. Medvedev called for a new system of state defence orders. This last has been notoriously opaque; many complain the money is not wisely spent and Russian-made weapons are over priced and not modern. Note that each of these touches on corruption: there are those who think that Putin returned to the Presidency because only he has the political muscle to attack this pervasive problem. Perhaps so, we will see. I still think that we need to see someone in an office close to the two led away in handcuffs for an anti-corruption drive to really bite.
Russian protestors lose steam
Demonstrations. The opposition movement is losing steam. As we have seen before in post-Soviet Russia, it is one thing to agree on dislike of the present regime but quite another to agree on what comes next. An association of former ins wanting to get back in, communists, nationalists and “new young people” do not have very much in common. The two pre-eminent leaders (or actors: are there any “leaders”?) now appear to be the hard left Sergey Udaltsov and the anti-corruption (and rather nationalistic) Aleksey Navalniy.
Mucha ado about very little in Russian elections
by Patrick Armstrong
ELECTION. The last polls are published and it’s clear Putin will win on the first round. VTsIOM. FOM and Levada all agree and their numbers average out at: Putin 60-61%; Zyuganov 15%; Zhirinovskiy 8-9%; Prokhorov 7-8% and Mironov 6%. As always, any significant variation from these numbers will be cause for suspicion. I reiterate that when the final results – as the Duma ones did – correspond to long series of opinions polls from different sources then the burden of proof is on those that say the results were cooked. Really robust evidence is needed to counter the appearance of the expected. This fact ought to be apparent to the meanest intellect but for some reason is no t. I expect the customary incompetent and biased reporting from the Western media. Once again, the runners-up will not be the “liberals” so lionised by Western observers but the Communist and Zhirinovskiy nominees. The rest – however many there may be – compete for 10% to 15%. But that truth – an immutable law of Russian elections since 1991 – seems to be unable to be grasped by so many outside observers who really think that the inclusion of, say, Yavlinskiy would make some difference. Not to Putin’s vote, not to Zyuganov’s vote and not to Zhirinovskiy’s vote.
Russia's silent majority raises its voice
by Patrick Armstrong
Silent majority. United Russia is not a party to get excited about. It’s made up of apparatchiks who like power and all that it brings. No one who votes for it is proud of doing so. Its program is boring: support the Boss and more of the same. But more of the same isn’t so bad for millions of Russians who endured the lawlessness, disorder and poverty of the 1990s. Their lives are better by every measurement: more employment, better wages, longer life span, more freedom in the useable sense, higher pensions, improved medical care, more and better infrastructure, more opportunities. So millions of Russian voted for more of the same. Putin is the symbol – and for very good reason – of the measurable and real improvements in the situation of Russians.
Putin, Zyuganov, Zhironovsky: business as usual
by Patrick Armstrong
Candidates. The rules say that nominees of parties in the Duma are easily registered. So Putin (United Russia), Mironov (Just Russia), Zhirinovsky (LDPR) and Zyuganov (KPRF) were all registered early. Independents must produce two million signatures (a process that requires money and organisation). Mikhail Prokhorov (independent), who has lots of the first, passed and was officially registered The CEC rejected Yavlinskiy (Yabloko) saying that a second check of 400,000 signatures turned up 23% invalid. Yavlinskiy says he will appeal. This would mean that Yabloko members could not be elections observers but Putin and Prokhorov have said they will give them mandates to do so. The signature collection process is rife with fraud and easily-discovered technicalities.