Anti-corruption efforts have been significantly stepped up in recent months, both in terms of headline making events (e.g. the dismissal of Serdyukov) and the less heralded progress in the introduction of new laws to combat the source. One of these is a ban on Russian bureaucrats holding foreign bank accounts (this represents a watering down of the original provision, which would have also banned foreign property holdings).
Not everybody is happy with this law, as to be expected. What is not to be expected is who exactly that is. For instance, Mark Adomanis, a liberal anti-Putin blogger who is nonetheless one of the most informed and objective Russia watchers out there (which many of his detractors take as evidence that he is a Putin stooge). Well, judge for yourself, based on his reaction to a press conference with Presidential Chief of Staff Sergey Ivanov, in which he said that bureaucrats would have three months to move their assets back to Russia.
Actually pretty scary stuff, one of the worst thing to come out of the Kremlin in awhile. Forcible asset repatriation = enormous power grab
— Mark Adomanis (@MarkAdomanis) April 3, 2013
“Forcible asset repatriation”? That’s some strong rhetoric there! I must have missed the part where the Kremlin was holding a gun to the heads of those offshore chinovniki forcing them to continue working for the government. Why is no-one being arrested for extortion??
As an informed observer, Mark Adomanis surely knows that quite a number of Duma deputies and other officials have already resigned their seats because they’d rather keep their foreign nest eggs than continue in political life. Nobody is forcing them to make the latter choice, so how does “forcible” describe anything?
Fortunately, he soon clarifies his position.
@ericgarland the fact that all those Russian bureaucrats had money stashed abroad was a (very crude) check on the center's power
— Mark Adomanis (@MarkAdomanis) April 3, 2013
@ericgarland if they actually try to follow through on this it would put Putin in a much, much more powerful and domineering position
— Mark Adomanis (@MarkAdomanis) April 3, 2013
Oh, I see. Less corrupt bureaucrats equals a more powerful Putin. And because Putin is the Dark Lord of the Kremlin, it’s for the best if bureaucrats were to remain just as corrupt and apatride as they are now. Essentially he would have Russia cut off its nose to spite Putin’s face.
@ericgarland in other countries it might very well be a welcome change, but in Russia it seems like a clear sign of regression
— Mark Adomanis (@MarkAdomanis) April 3, 2013
Note also the overt double standards.
Now just to make things absolutely clear, I don’t have an issue with that. Mark Adomanis has a perfect right to his own political views on Russia and to air them on his blog and Twitter account. What I do however want to point out is that many people, including some fairly high profile ones, seriously consider him to be a “Russophile” or even a paid-up stooge of the “Putin regime.” (Some of the more conspiratorial-minded even consider Masha Gessen, who wrote a biography of Putin called “The Man without a Face,” to be a Kremlin flunky). In reality, as far as his priorities go, cleaner and more effective government in Russia takes a clear second place to the prime imperative of politically undermining Putin. All this just serves to illustrate how utterly divorced from reality the mainstream commentary is when it comes to Russia and Putin.
PS. Since I scheduled this to be published, Adomanis has written an entire blog post about it, where he in addition also takes exception to the Russian government not bailing out Russian deposit holders in Cypriot, in addition to expounding on the points he already made on Twitter.
The fact that many Russian officials had accounts in foreign banks acted as a (very!) crude check on Putin and the center’s ability to control things: true autocracy is impossible in a situation in which any mid or high level official can, at a moment’s notice, go abroad and live off the accumulated assets in their foreign bank accounts. … Assuming the Kremlin actually can get officials to “repatriate” their foreign holdings (a very big if, I grant you) they will be in a much weaker position to question or resist anything the President demands. Basically, completely banning the holding of foreign accounts would make the Russian government even more unaccountable, unpredictable, and arbitrary.
The evidence for these assertions that Adomanis brings to the table are precisely zilch. This is especially disappointing coming from a pundit who has based a substantial part of his blogging career on expounding the extremely tenuous nature of the ties between autocracy/democracy, and things like economic performance and demographic health. So why now this supposed link between corruption and democracy? Aside from the general lack of data and incoherence, for a man so concerned with “autocracy” in Russia, I wonder if Adomanis realizes that simply translating his article would make for excellent propaganda for Putin (e.g. by feeding “the good Tsar stymied by his bad boyars” trope).
PPS. And it’s been translated at Inosmi, with most of the reactions as predicted above. E.g. the commentator AndrewGur: “Did I get this right? This journalist is suggesting that one component of democracy – is the possibility not to obey the orders of the President while under the control of a foreign enemy who controls them by dint of them having their money there?”
I generally like Mark’s stuff, but I think he’s taking things too far with the “true autocracy” point. I don’t see it so much about Putin reasserting his personal power as it is a correct realization that many in the Russian elite have no long term stake in Russia. Putin should subordinate them, and if re-rooting their assets back home will work, then so be it. They became rich from extracting wealth from the county, at least they could do keep it there for investment.
I give Putin credit in these efforts (if he realizes them.) It would do some Western countries well to prevent the off-shoring of capital.
I agree with that. I do consider the democracy – autocracy spectrum to be a valid way of looking at things, albeit it has a ton of nuances (e.g. democracy doesn’t imply liberalism). But on that scale I maintain that Russia is in the middle ground grouping that also contains the likes of Turkey or Georgia; certainly it is not comparable to Latin American juntas.
And I of course agree that having an offshore elite is a bad thing that should be combated within reasonable legal bounds.
During World War I, the Russian elite out of a sense of patriotism and duty sold off their assets and properties abroad and invested them into Russia, including moving their money back into the country. This seems to have been a voluntary, spontaneous act of patriotism. As a result, when the Revolution came almost everything they owned was taken and they became almost penniless (other than jewelry and items they could pawn off).
I suppose one can wonder whether the post-Soviet elite is less patriotic or if they have learned a lesson for the past – or both..
The Cyprus episode really took the cake. Had Putin bailed out the Russian companies with Cypriot bank accounts it would’ve (somewhat rightly) been attacked as TBTF crony capitalism. But Putin doesn’t bail them out and he’s attacked for that? Ridiculous.
“In reality, as far as his priorities go, cleaner and more effective government in Russia takes a clear second place to the prime imperative of politically undermining Putin. All this just serves to illustrate how utterly divorced from reality the mainstream commentary is when it comes to Russia and Putin.” I noticed this from David Frum too, author of the “The Right Man” which at the time it was politically expedient in 2001-2002 pre-Iraq invasion highlighted Bush’s adroit post-9/11 friendship with ‘Pootie Poo’ (I’ve never seen any evidence that Bush actually called Putin that).
Frum used the story of a drunk who got caught in a garbage truck (but apparently still had his cellphone to call for help) in Moscow as evidence of Russians general heartlessness and indifference toward human life. Frum’s Russian ‘source’ for this story then proceeded to explain that Russia is still dying demographically and Tatarstan would’ve seceded from Moscow if given the chance. Naturally the need for registration to comment limited angry replies from Russians at such ludicrous tropes.
http://www.thedailybeast.com/articles/2013/04/01/david-s-bookclub-it-was-a-long-time-ago-and-it-never-happened-anyway.html
I want to echo a point that Mr. X is making. What this article by Adomanis shows is that for some people Putin can never win. If he permits his officials to stash their money away in foreign accounts he is tolerating corruption and his action proves that the entire political system is systemically corrupt and Putin cannot crack down on it because that would undermine him. If he cracks down on officials holding foreign accounts, he is behaving like a dictator and is increasing his power and “nationalising” the officials (how does one nationalise what – officials – supposedly belong to the public realm already?).
For the record I can see absolutely nothing wrong or remotely sinister in a government concerned about corruption passing legislation that requires holders of public office to keep their money in the country. As has been correctly pointed out, the government is not forcing all Russians to repatriate their money and to stop owning foreign property or holding foreign accounts. It is merely requiring those who hold public office to desist from doing so. If they do not want to surrender their foreign accounts and foreign property all they need to do is surrender their public office. Any official rich enough to have a foreign account and to own foreign property can presumably afford it.
I would add three further observations:
1. Obviously there will be some people who will try to circumvent the new law by transferring their foreign property or their foreign accounts to their relatives. However one presumes that the law is being framed and will be enforced to prevent such a thing.
2. In what way does obliging officials to own only Russian property and to put all their money in Russian banks in Russia actually increase Putin’s power over his officials? It would only do so if Putin was in the habit of arbitrarily confiscating his officials’ property or their money. When has he ever actually done such a thing? The reality is that he has never done it and as anyone truly familiar with modern Russia knows he cannot do it . If Putin really did start confiscating his own officials’ property and bank accounts simply because they crossed him not only would he immediately lose their confidence but he would run into a cascade of legal challenges not just in Russia but in the European Court of Human Rights, which he would lose. Of course he could at that point opt out of the European Convention of Human Rights but by then he would have a crisis on his hands which having alienated his officials he would be unlikely to survive.
3. By contrast we absolutely do have numerous examples of western governments trying to exert pressure on political elites of foreign countries by freezing or confiscating the accounts of their officials. Within my own memory this has been done to the Philippines, Yugoslavia, Iraq, Libya, Syria and (yes) Russia. What is the Magnitsky law and its various proposed European replicas if not an attempt to exert pressure on Russian officials through their foreign property and their bank accounts? Obliging Russian officials to keep their money and property in Russia does not obviously increase the Russian government’s power over them. What it does however do is protect them and Russia from attempts by foreign governments to put pressure on them.
I would finish by saying that my point 2 exposes the assumption behind Adomanis’s argument. The only way Putin could go about confiscating his officials’ money and property was by being a dictator. Obviously that is what Adomanis thinks he is. I recall an article he wrote some time ago in which he said that the political culture in Russia was like that of a right wing Latin American dictatorship. In reality dictators outside totalitarian systems since they lack legitimacy are even more dependent on the support of their officials than leaders of democratic states and would be very unlikely to do anything that might alienate them. Having said this as someone who unlike Adomanis has actually lived in a right wing dictatorship (albeit not in Latin America) I can categorically say that Russia is nothing like one.
I would finish by saying that my point 2 exposes the assumption behind Adomanis’s argument. The only way Putin could go about confiscating his officials’ money and property was by being a dictator. Obviously that is what Adomanis thinks he is. I recall an article he wrote some time ago in which he said that the political culture in Russia was like that of a right wing Latin American dictatorship. In reality dictators outside totalitarian systems since they lack legitimacy are even more dependent on the support of their officials than leaders of democratic states and would be very unlikely to do anything that might alienate them. Having said this as someone who unlike Adomanis has actually lived in a right wing dictatorship (albeit not in Latin America) I can categorically say that Russia is nothing like one.
Very good point. Adomanis seems to buy into the trope that Russia is both a dictatorship AND permanently “regressing” into (more?) dictatorship. It’s totally bizarre.
Adomanis started bleating about Russian police brutality after the so-called Bolotnaya riot last year when planned attacks on the police took place and rioters tried to break through the cordon near Udarnik cinema so as to gain access to the bridge across the Moscow River that affords access to the Borovitsky entrance to the Kremlin.
I took Adomanis to task about his police brutality allegations and asked him for evidence: he replied that the films showing the police beating the poor white ribbonist freedom fighters was evidence enough of their brutality.
I then queried how he thought the London Metropolitan Police would react if a police cordon of theirs was attacked and broken by demonstrators.
I for one know full well how the British police react to such confrontations off protesters, having on several occasional suffered assault from them. You see, they don’t like having half bricks chucked at them from within crowds. They’re funny like that.
Yes, I never quite understand this anti-police mentality that is found throughout the world. The police are almost always characterized as brutal thugs who are never there when you need them. I am fully aware that at times policemen can be brutal and sometimes show unprovoked brutality or excessive force. However that doesn’t mean ANY time a policeman has to draw his baton or his weapon that it’s an instance of police brutality. Most of us wouldn’t like it if a group of people rushed us, much less if this group of people rushing us were also throwing heavy objects at us.
Dear Moscow Exile,
I cannot agree with you sufficiently. One of the persistent problems with western coverage of Russia is that the sort of people who write about Russia have little idea of how the police, the law and the courts work in their own societies since like I presume Adomanis they come from middle class backgrounds and are therefore unlikely to come into contact with them. One persistently comes across this in discussions of Pussy Riot for example.
For the record I thought the policing of the protests in Moscow was exemplary. As for the 6th May 2012 protest as I recall Ksenia Sobchak says she stayed away because she had heard that violence was planned during it and we have proof of that from the fact that someone came to the protest with a petrol bomb.