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COLUMN - In Russia, unheeded cries of corruption

Source: Thomson Reuters Foundation - Tue, 18 Dec 2012 21:29 GMT
Author: Reuters
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By John Lloyd

NEW YORK, Dec 18 (Reuters) - In Moscow last week at a conference for young Russian journalists, I met a man named Edward Mochalov, who differed from most of the participants in having spent much of his working life as a farmer. He retains the ruddy countenance and the strong, chapped hands of the outdoor worker in a hard climate - in his case, the Chuvash Republic, some 400 miles east of Moscow.

Mochalov's story is that when thieves stole some of his cattle and pigs, he protested to the authorities, only to find himself in jail for eight months for wrongful accusation. Maddened by what he considered the result of corruption behind the scenes, he protested all the way up to President Vladimir Putin, going so far as to appear in Moscow's Red Square with a placard telling his story, though to no avail. As he pursued justice, his farm went untended.

And so he turned to journalism. "I had no choice. The whole administration was corrupt, nothing to be done but fight them with words," he told me. Four years ago he founded a newspaper he called, boldly and baldly, Vzyatka (translation: The Bribe). It comes out most months, and it's replete with investigations and denunciations of corruption in his locality. He prints some 20,000 copies and gives them away. Demand, he says, hugely outpaces supply.

The local administration and power brokers simply ignore him and carry on as before. That complaint was voiced by many of the young journalists at the conference, who see their revelations treated with the arrogant disdain of silence. They have no illusions about their situation. The majority work in the provinces, and try to practice journalism in cities where the power structure, official and corporate, would often unite to squash or punish journalism that was out of line. When critical or revelatory pieces are published, they have found - as has Edward Mochalov - that nothing changes.

As a result, corruption still reigns. This month's scandal in Russia concerns Alexander Provotorov, head of the state telecommunications corporation Rostelekom. Provotorov is being investigated with others over his acts as a partner in Marshall Capital, a private equity firm, and the default of one of its subsidiaries on a ${esc.dollar}225 million loan. These matters are complex, long running - and puzzling. Provotorov was an ally of Putin, who in the past year has launched an anti-corruption campaign. The Russian watcher Brian Whitmore of Radio Free Europe picks up on the confusion in Moscow's top ranks when he asks, "Is it an anti-graft campaign? A purge of the elite? Or the start of a clan war?"

Among citizens, corruption produces disgust, mirrored increasingly in popular newspapers like Moskovsky Komsomolets, a Moscow tabloid, as well as on websites read by the young. According to a poll by the non-governmental Russian research organization, Levada Center, the number of people who believe that bureaucrats work mainly for their own enrichment has grown from 3.0 percent to almost 30 percent in the past two decades.

It has become a more settled conviction that the political/corporate classes have constructed an all-but-impregnable fortress of wealth and privilege, with high walls to keep the rabble out and behind which they have a high old time. Boris Makarenko of the Centre for Political Technologies, a liberal institute, says more and more Russians, especially those like the young journalists, no longer see themselves as subjects. They "want to make inputs."

There is much a citizen should input. The INDEM think tank in Moscow, run by Georgy Satarov, a former aide to President Boris Yeltsin, estimates that corruption costs the country ${esc.dollar}300 billion to 500 billion a year. With a gross domestic product of some ${esc.dollar}1.5 trillion, that is up to one-third of the economy. Meanwhile, capital flight last year came in at ${esc.dollar}84 billion, double that in 2010 and is still, it seems, increasing.

Putin is not thought to be far from the trough. There are allegations from the political analyst Stanislav Belkovsky that the president's personal pile is more than ${esc.dollar}30 billion, though these estimates are unsourced and seem politically biased. (Belkovsky is an associate of the exiled oligarch Boris Berezovsky, an enemy of the president.) More to the point, perhaps, was a report by the opposition leader Boris Nemtsov that the official trappings of the president included private, expensively tailored aircraft, 20 residences, four yachts and almost ${esc.dollar}700,000 worth of watches - the lifestyle of a billionaire. On these allegations, the Kremlin responds with silence, or a curt denial.

Russian corruption underlies the latest spat between Russia and the United States. Earlier this month, President Barack Obama signed into law the so-called Magnitsky Act, which will deny visas to Russia officials thought to be connected with the violent death in jail of Sergei Magnitsky, a lawyer pursuing a state-level tax fraud. The American financier who employed him, Bill Browder, has campaigned tirelessly for the law; it speaks directly to human and civil rights in Russia, and seems to have infuriated the Kremlin. The Duma (parliament), controlled by the president's party, is now discussing passing the "Dima Yakovlev Bill" - named after the Russian 2-year-old who died when his American adoptive father forgot that he had left him in a closed car in sweltering heat in 2008. The man was acquitted in the United States, and the Russian law on adoption was changed to allow more oversight by the authorities - but the case remains vivid enough in the popular memory to act as a rallying call.

Putin, in his state-of-the-nation speech last week, sought not only to pledge to fight corruption and end the impression of the elite being "an isolated caste" but also to laud Russia's "state civilization, unified by the Russian people, Russian language and Russian culture which  unites us, does not allow us to dissolve." Yet the "dissolving" of Russia will not come, as he claims, from the imperialist designs of a hypocritical West but from the challenges - in shrinking population, polluted cities, groaning infrastructure, gross inequalities  and vast corruption. To deal with those, the Russian leader needs to be part of a global solution. For the moment, though, he isolates himself in the very problem he needs to fix.

( John Lloyd co-founded the Reuters Institute for the Study of Journalism at the University of Oxford, where he is Director of Journalism. Lloyd has written several books, including "What the Media Are Doing to Our Politics" (2004). He is also a contributing editor at FT and the founder of FT Magazine.)

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