#12
Vremya MN
January 18, 2002
YOUNG OLIGARCHS
A good majority of those who wield financial power in Russia today a product of
early perestroika, when economic power was delegated to youths in the komsomol
Author: Olga Kryshtanovskaya, department of elite studies, Institute
of Sociology of the Russian Academy of Sciences
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
RESULTS OF SOCIOLOGICAL SURVEYS.
The revolutionary changes that took place in Russian society in the 1980's and 1990's began when the conflict between generations of old (70-80 years) and young (45-60) politicians reached a matured stage. The former did not want to vacate the watering holes that were their positions, while the latter sensed that power was gradually slipping off their hands as they themselves grew older. When Mikhail Gorbachev became General Secretary of the Central Committee of the Communist Party of the USSR, the young nomenclature got its chance to change the situation.
The average age of the team that initiated the perestroika was 68.5 years. Gorbachev put into motion a true "staff meat-grinder", mercilessly getting rid of the men of Brezhnev's era. The Politburo became seven years younger, the Central Committee five years. The nomenclature got its chance to make careers at a much faster rate. This means the new generation of the nomenclature that came into the corridors of power with Gorbachev would not have the time to exploit their victory. It would be buried - along with Gorbachev - under the ruins of the Soviet Union.
All the same, Gorbachev succeeded in making changes in the political system, changes that would have global consequences for the powers-that-be. Introduction of the so-called Komsomol economy was one of the fundamental reforms. It permitted young apparatchiks to try their hands in business. Youth centers of scientific-technical crafts were established under the aegis of the All-Union Lenin Communist Union of the Youth (Komsomol) in the capital city in 1987 and 1988. Enjoying unique privileges, these centers became the first business structures in the Soviet Union. Their success put forth a new process - the nomenclature began exchanging power for property. In the long run, it resulted in the appearance of a second branch of the government, the financial oligarchs.
The functions of the Centers were restricted to mere cashing of funds stashed away in the bank accounts of most Soviet enterprises. Permitted to execute this simple operation, the Centers got their commission as mediators between state enterprises and individuals - from 18% to 33% of the sum of the deal. 5% of the commission went to the "overseers", the party structures.
Legal commerce in Gorbachev's era was something reserved for the privileged only. Only the nomenclature and its puppets were permitted to deal in something that promised - and provided - super dividends. Having got tired of sitting in their dusty offices, Komsomol functionaries got into show-biz, international tourism, establishment of banks, construction and real estate companies. They handled export- import operations as well. All of them were young men under 30.
The clearer it became that the barter trade of power for property was profitable and commercial risks minimal, the more party and Komsomol functionaries rushed to the new structures of the emerging "alternative" economy. Between 1987 and 1992, the ratio of ex- functionaries in business elite grew from 38% to 61%.
The average age of the new Russians was not that green at all: 41.1 years in 1992, and 44.6 in 1994. It means that young Komsomol functionaries were not alone - even before the mass privatization, there were also men of medium and even old age who were smart enough to think ahead into the future and move to positions of power in the economy.
The nomenclature sector of the quasi-market economy was formed by several means. It was formed by way of auctions (privatization, essentially) of ministries and departments (Gazprom was established in this manner in the first place). It was formed by way of establishment of commercial structures on the initiative and with the direct participation of state structures that promoted their own men to manage the new business ventures. A lot of companies were established by the Soviet Ministry of Foreign Trade and Soviet Committee for Foreign Economic Contacts. State officials established commercial structures to suit their own needs and eventually got themselves assigned there to pull all sorts of strings.
The barter trade of power for property was the most actively used method. In the Soviet Union, there was the practice of using "diplomatic exile". A new way of leaving the gradually emerging power structure to transit into business. These structures were quickly staffed with high-ranking retirees and personal pensioners.
This barter trade eventually took another form - some state structures delegated commercial powers to their appointees. The appointees were usually young men who immediately became heads of powerful financial structures. This golden youth appeared as self-made men only to the naive. The fact is that powerful state structures were always behind them. Studies of how representatives of different generations came to business is important for the proper understanding of the emergence of market economy in Russia. This is because the "new bourgeoisie" had a direct effect on politics. The first attempts of this sort were very naive. They were restricted to attempts by new Russians like Artem Tarasov, Herman Sterligov, Konstantin Borovoi and others to claim financial prosperity through parliamentary electoral campaigns. Aggressive attempts by the newly emerged business to "buy power" became much less frequent only several years later. Businesses' political clout went on growing but businessmen became much more cautious. All branches of the government started experiencing lobbyism. Large businessmen delegated its representatives to all levels of power structures. Representatives of large businesses controlled 17.3% of the Duma in 2001, 4.2% of the Cabinet, 8.1% of gubernatorial offices, and 15% of the presidential inner circle.
Back in the 1990's, the ratio of youths who were eager for seats on parliaments of different levels was rapidly falling. There is more to the tendency than meet the eye. The chances of getting elected were falling as well. The following is an approximation of the chances of varying age groups to get elected into the Duma in 1999: young men under 30 had the worst chances of only 9.6% (the smallest). The rest of the age groups had much better chances: 26.1% for those within 30- 39 years old, 24.1% for 40-49 years old, 25% for 50-59%, and 23.2% for 60 years and over. How come this discrimination? The reasons are rooted in the organizational weakness of youth movements, the absence of a network of youth organizations with regional subdivisions, and their lack of clout among voters. The Komsomol passed away, and nothing was formed in its stead by way of national youth organizations, representing the interests of the youth in power structures. The financial factor is playing an important part here too - the youth has much less by way of support in business structures.
Do Russian political parties bet on the youth? The answer to this question may be given using only two parties as an example, that is LDPR and Union of Right Forces. The reasons are different again: LDPR relies on its charismatic leader Vladimir Zhirinovsky (and it is typical for charismatic leaders to appeal to the youth for support above the head of the regime). The Union of Right Forces relies on the youth because the new generation is more prone to value democratic ideals and Western values. Whether this is true or not remains to be seen.
Young men under 30 account for less than 3% of all parliaments on all levels. On the federal level, however, they are represented twice as better than on the regional. Ethnic republics and autonomies of the Russian Federation are the oldest in this respect - they have the lowest number of young deputies. Men in their forties are the most populous group in all parliaments.
There are legislative age margins for candidates for positions in executive power structures in some regions.
The formation of the political elite in the executive power structures in the 1990's took place in two forms. The first may be termed as a big leap, as in when a young man without experience in management was appointed to a vital position. Boris Yeltsin's advisors were ex-scientists of the Academy of Sciences. Among them were historian S. Stankevich, sociologist G. Starovoitova, mathematician G. Satarov, S. Shakhrai and G. Burbulis. Yeltsin elevated to the governmental level young and inexperienced Gaidar, Glaziev, Khakamada, Generalov, etc. These meteoritic promotions were a characteristic feature of the president but were also typical of the time, since democratic system in Russia followed its own laws.
There was, however, an alternative way to the top. The way of gradual ascension. Most young men got to the corridors of power by gradual infiltration and careful staircase-climbing.
(Translated by A. Ignatkin)
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