Foreign Policy Research Institute A Nation Must Think Before it Acts The End of the Power Vertical? Corruption and Stagnation in Putin’s Fourth Term
The End of the Power Vertical? Corruption and Stagnation in Putin’s Fourth Term

The End of the Power Vertical? Corruption and Stagnation in Putin’s Fourth Term

Russian President Vladimir Putin has repeatedly promised to tackle corruption. But in his new term, corruption is likely to get worse, not better. The rot of corruption in Russia is no failing of the system – in many ways it is the system working as intended.

Shady practices like the recent discovery that state organs may be complicit in the Latin American narcotics trade, or backroom discussions between senior officials and oligarchs on yachts, will seep only deeper into the foundation of Russia’s politics.

Graft has been present in Russian society for centuries. It was visible in interactions between aristocrats and judges in Imperial Russia, the unofficial “gray markets” in the Soviet era, and more recently in everyday bribery and influence peddling. Nearly every Russian leader has sought to fight corruption – or, when that fails, to shape it to their benefit. Vladimir Putin’s third term in office as president has shown that corruption is not a bug but a feature of government. Corruption and informal dealings serve as a stabilizing force that can manage in the place of formal politics.

Putin’s coming reelection on March 18 will confirm for him and for Russia’s elite that this style of governance works. Shifting from formal to informal methods of rule will deepen during Putin’s fourth term. Corruption is what’s needed to keep informal networks working.

Corruption, in other words, is not an accident, the consequence of insufficient state capacity or a lack of willpower. Rather, corruption responds to political incentives. My research shows that accountability limits how much corruption elites engage in – even when elections are unfree or don’t exist at all. Faced with political competition, authoritarian leaders respond to incentives to decrease bribery. For example, I found that when Russian governors are up for reelection or reappointment, they work to reduce bribe-taking by up to 13 percent.

This is bad news for Russia. So long as Putin ensures his allies face no negative consequences for corruption, there is no reason to temper their greed. The result has been a surge in graft – from the misspent billions for the Sochi Olympics to the National Anti-Corruption Committee’s announcement this month that bribes had tripled year-over-year – accompanied by a withering of the much-discussed “vertical” of formal political institutions that Putin constructed in his early years in office. The vertical of hierarchical control has been displaced by informal deals. Where before the regime was focused on building some semblance of stable state institutions and formalizing authority, the new norm after these elections may well be the abandonment of those institutions and structures in favor of reliance on informal deals and personalized authority-for-hire.

Consider, for example, the case of former restauranteur and Putin associate Yevgeny Prigozhin. He has been involved in everything from multi-million-dollar defense contracts to allegedly creating a troll factory to influence the U.S. presidential election and fielding a mercenary force in Syria. Putin’s judo sparring partners receive inflated government contracts, while unqualified regime insiders are appointed to governorships. Rather than a strict hierarchy, this system of government is more like a network of acquaintances, bound together by self-interest.

Distinctions between politics and business, state assets and private assets, and security services and criminal networks have blurred. Having demonstrated that a system premised on corruption and personal connections is able to keep them in power, Russia’s elite is unlikely to abandon this system after the elections. The result will be an increasingly informal method of government made possible by more theft and graft. In Putin’s expiring third term, paths to development and stability based on institutional rules still seemed viable. But the recent degradation of Russia’s geopolitical position, the resulting scarcity of free resources, and the risks of restraining your own authority with institutional structures (such as political parties or even a viable cabinet of ministers), are pushing the regime towards corruption as the most comfortable political mechanism. 

Indeed, my research has found that elections in authoritarian regimes don’t always promote accountability. The goals of meritocracy and effective governance often take a back seat to day-to-day political management and suppression of opponents. This does not bode well for the aftermath of an election with no real choice – and thus will impose no constraint on the main candidate.

True, Russia has launched numerous waves of “reforms” in recent years. But renaming the police or reintroducing hobbled gubernatorial elections do not create a real contestation of political power. Nor do they drive a wedge between the grabbing hand of the state and networks of crony elites.

As complacency rises after what will no doubt be a resounding victory for President Putin, expect a surge of infighting as the government increasingly relies on personal ties to govern around formal rules. This system has proven it can work for Russia’s elites. But it “works” only thanks to corruption, the last grease capable of keeping the wheels of the political system turning.

This article was originally published by Eurasianet on March 9, 2018. Geopoliticus has republished the essay, without further editing, with permission from Eurasianet.