14 March 2023
by Arch Tait
Arch Tait reviews The Russia Conundrum. How the West Fell for Putin’s Power Gambit and How to Fix It, by Mikhail Khodorkovsky with Martin Sixsmith, W.H. Allen, 352pp, ISBN-9780753559239, London, 2022. [Penguin Paperback, forthcoming, ISBN-9780753559253, 368pp, London, April 2023].
Mikhail Khodorkovsky and Martin Sixsmith provide a detailed and enlightening account of the antecedents and nature of the Putin era, written by an observant eyewitness and a BBC former correspondent in Moscow. It details the gulf between norms of political behaviour long regarded as self-evident in the West and the unbridled gangsterism of the Putin regime. The Russia Conundrum was followed in late 2022 by Khodorkovsky’s How Do You Slay a Dragon?, a brief manual for how to reform Russia after the demise of the regime.
Once Russia’s richest oligarch, Khodorkovsky describes how, as a Komsomol organiser, he discovered private enterprise in the 1980s. There is a highly readable analysis of the Yeltsin years, an account of how Khodorkovsky acquired Yukos, grew it to be Russia’s major oil company, had it stolen from him and was imprisoned by the Putin regime.
His ‘long and painful personal experience’ of the capricious, personalised model of authority that Putin exercises has taught him the hard way that Putin ‘can never be trusted, that he is capable of the most terrible crimes, and that his smiling promises of cooperation and understanding have always been less than worthless.’
Today he is more convinced than ever that ‘he is a dictator who must be stopped, regardless of the risks and regardless of the costs that we will have to bear; our sufferings pale by comparison with the shelling and bombing of innocent civilians. For if we do not stop Putin in Ukraine, he will inevitably lead us into global war. Comparisons to Hitler may seem exaggerated to some, but we should be very wary of appeasing Putin in the manner that gave Hitler free rein in the 1930s. We must not repeat that mistake — it will be too costly for all of us.’
Khodorkovsky declares himself a Westerniser. In 1987, Mrs Thatcher ‘with her self-confident optimism and unwavering belief in Western values, her stylish hats, glamorous sable-collared coats and beige suede boots’ seemed like a visitor from the future, ‘a portent of what Russia’s future could be if the right choices were made and history were to look kindly on the nation’s efforts.’ Russia’s coercive autocracy, however, has always beeen ‘belligerent and aggressive. Its modus operandi will always be messianism, militarism and adventurism.’ It has no possibility of internal stability; it can be stable only when it is thrusting aggressively outwards.
Boris Yeltsin, we are told, believed that ‘Russians should not be strangers in the Western world. We are Europeans,’ but Putin doesn’t understand that people everywhere are motivated by a desire for liberty. ‘That’s why he continues to parrot the old refrains, fulminating about “the machinations of the West”, “Russia surrounded by foreign enemies” and “whoever is not with us is against us”.’
Yukos and the Russian Economy
In 1996 Khodorkovsky bought Yukos, a major oil producer and ran it in accordance with the previously unheard-of Western approach that ‘honesty is the best policy’. It became a symbol of how the Russian economy and its shady business culture could transform itself. By 2003 its market capitalisation was over $30 billion, and that year Khodorkovsky publicly confronted Putin over corruption in his immediate entourage. ‘Unbeknownst to me at the time, the beneficiary of the Severnaya Neft deal was not merely a sidekick of the president, but the president himself. I was told later by sources close to Putin that the missing $400 million had gone directly into his personal account.’
Khodorkovsky was arrested on trumped-up charges and imprisoned by Putin for ten years. At the time of his arrest the Russian stock market lost a tenth of its value in a single day. From then on, the country saw the inexorable rise of nationalist, conservative forces who believe that economic freedoms and individual rights must be subservient to the interests of the state, and that America and Western Europe ‘are natural enemies, not natural collaborators’.
The Putin Model
Instead of Western transparency, Putin set about reinstalling Bolshevik state coercion. ‘I had challenged his authority, and that is the one thing that autocrats cannot allow to happen.’ At first Putin had benefited from high prices for Russia’s oil and gas, boosting GDP and lifting living standards, but instead of using the breathing space to diversify the economy and develop other streams of sustainable revenue, the Kremlin marched blindly on towards the precipice. When global energy prices collapsed in 2014, the country slid inexorably into recession. Putin’s response was to annex Crimea, a manoeuvre that succeeded in shoring up his domestic poll numbers, but brought Western sanctions and a further, inevitable decline in national prosperity.
Khodorkovsky describes Russia today as being run on a neo-feudal model where the regional elites, Putin’s placemen, undertake to provide votes and revenue for the centre and in return get a free hand to run the finances of their regions as they see fit. Sixty percent of revenues collected from the population go to the centre, leaving 40 percent for the region’s spending. But in return for unwavering loyalty and political support the centre subsidises them to the tune of a further 10 to 20 percent of the regional budget. In the case of Ramzan Kadyrov in Chechnya the figure is over 90 per cent.
Putin rules through patronage, personal connections, corruption and the brazen manipulation of the state apparatus. The continuing existence of the whole Byzantine apparatus depends exclusively on Putin being there to keep pulling the levers. If one were to remove Putin from the equation, the system would lose its equilibrium and the country would enter a catastrophic state of clan fragmentation.’ This has been engineered with the deliberate intention of making him indispensable. In July 2020 he rewrote the constitution, opening the way for him to stay in the Kremlin until he is 83.
Under Putin the FSB achieved Andropov’s dream of placing its people across all sectors of government and business. Today, the corruption and embezzlement of state property ‘eat up more than 10 percent of GDP.’
‘I am acutely aware of the way Putin’s leadership stifles economic prosperity. But it is more than that. It has a noxious effect on the moral welfare of the country. It stifles our nation’s present, our people and our future.’ Much state expenditure is unproductive, the authorities withholding investment essential for modernising the economy. ‘Apart from the banal purposes of theft and self-enrichment, the rationale for this policy is to accumulate reserves and avoid dependence on western countries.’ However, since the invasion of Ukraine in February 2022 a large part of the Kremlin’s anti-Western reserves have been frozen by the West.
Entrepreneurs continue to be targeted and cases of regime-backed corporate raiding are now estimated to account for one in seven of all business takeovers, involving funds in the tens of billions of dollars. Putin’s simulacrum of democracy shows the Russian people and the West a facade of democratic structures behind which there is nothing. The regime’s laws rule out the possibility of changing the power structures by means of elections.
Khodorkovsky devotes a chapter to his imprisonment, noting that, despite everything, the overall changes to the gulag system since the days of Stalin are ‘enormous’. No one is now deliberately starved, prisoners are no longer worked to death, and the camp bosses can no longer kill a prisoner out of hand. To do so would entail a massive amount of paperwork.
The initial hearing in his first trial came as a shock. Evidence was simply disregarded. ‘Sometimes, you feel as if you have been kidnapped by aliens. They aren’t the enemy, they aren’t fascists; they’re just extra-terrestrials who happen to look like us, but have nothing whatsoever in common with human beings.’
After an international outcry and the intervention of Western politicians he was released in December 2013 and put on a plane to the West. This was not a manifestation of the quality of mercy: it was clear that Putin wanted to release him because ‘keeping me in jail was making him look bad in the eyes of the world, but because he also wanted to brush up his image ahead of the Sochi Winter Olympics in February 2014.’
The Psychology of Putin
The first upturn in Putin’s fortunes came once he had endeared himself in the 1990s to the pro-perestroika mayor of St Petersburg, and under Putin’s guidance the city was turned into a stronghold for organised crime, with its historic port acting as the principal gateway for huge volumes of drug-trafficking.
In the decades of Putin’s ascendancy, his nationalistic supporters have given ‘The Russian Idea’ a new twist. The notion that only Vladimir Putin could guarantee stable governance was so widely repeated and promoted that, ‘like Louis XIV, he came to believe l’état c’est moi.’ When Putin’s chief of staff said in 2014, ‘there is no Russia today if there is no Putin’, it was not a joke, but a consecration of the one-man state. The Personality Cult was back. When a photo-shoot of the shirtless president boosted his standing among female voters, he was delighted, but infuriated when it was co-opted with ribald comments by Russia’s gay websites. By now, however, his superhuman powers are under question, with Alexei Navalny and others referring to him as ‘the old man in his bunker’, a leader who makes increasingly rare public appearances and fears the world beyond the Kremlin walls.
The disinformation campaign during the US 2016 election allowed Putin to represent to the Russian people that the vote was being falsified in favour of Hillary Clinton. He wanted to provoke outrage among Trump supporters, so they would proclaim to the world that the US system was rotten. ‘And he succeeded in spades.’ The departure of Donald Trump in 2021 opened the way for change and a recognition of the benefits of a reset in East-West relations, but Putin’s undermining of Western liberal democracy seemed to have emboldened him. He stepped up his campaign of aggression with a series of damaging cyberattacks on key infrastructure targets in North America and Western Europe. ‘Like all authoritarian regimes, Putin’s answer is even more foreign aggression, to keep Europe always on the defensive, and — following the invasion of Ukraine — on the brink of war.’
In Soviet times, Khodorkovsky recalls, the KGB would regularly stoke confrontation with the West, but its aggression would be softened by the Foreign Ministry, whose diplomats had direct contact with colleagues in Europe and North America. ‘The unprecedented dominance of today’s FSB, with its exclusive access to the ear of the president, means that the old mediating forces no longer exist. Wild theories of encirclement, danger and Western aggression, propounded by Patrushev and his associates, have become increasingly dominant and influential in the president’s circle.’ The February 2022 invasion of Ukraine was at least in part the result of the Kremlin’s distorted view of reality, stoked by this echo chamber of self-reinforcing paranoia.
‘Now,’ Khodorkovsky writes, ‘with history hastening its march, I am convinced more than ever that the future lies with us. There is ample and growing evidence that the Putin regime is becoming desperate, resorting to ever greater violence and repression to thwart the aspirations of the Russian people. The decision to invade Ukraine was an irresponsible gamble with genuine potential to rebound on Putin and his cronies. This is the moment to find hope and take action.’
Khodorkovsky’s paradox is that a weak Russia will seek to assert its strength, to take what it wants by force, to breach the rules of civilised behaviour, while a strong, confident Russia will possess the self-belief to focus on its own problems at home and play by the rules abroad.
The West, ironically, needs to encourage a worthy competitor in Russia if it wants to be certain of its own safety.