muscovy, a failed state

Despite his efforts to create a dictatorship with total control, putin did not even manage to monopolize the military.

Spoiler: Prigozhin’s coup or mutiny or whatever you call it, exposed the kremlin regime. It is a failed state. A failed state cannot fulfill the minimum requirements of a Night-watchman state and monopolize the means of force. putin also failed as a warlord. It is now evident for everyone, that putin wants to restore the muscovy empire. That can’t be done without annihilating Ukraine. But the little fascist’s three-day war failed.

His failure goes back to the days when he was made president by Yeltsin. At that time, putin began to transform muscovy to make it strong enough to restore the empire. He set himself up to accomplish two main tasks. He needed to silence the domestic opposition and create an economy strong enough to supply his military with what it needed for the invasion of Ukraine. He failed on both accounts. Although he managed to silence the part of the opposition that didn’t pose any threat to his regime, Prigozhin was not the only one who is discontent with putin. Other oligarchs have their own privat armies which they might use.

Concerning his second task, the russian economy is as inefficient, low-tech and import dependent as twenty years ago. Much of that is due to corruption. putin’s regime is based on corruption. But corruption is a double-edged sword. When the boss is corrupt, everyone beneath him thinks it is ok to plunder the state including the military.

russian plumbing

Source: Moscov Times and Youtube.

Nothing spells failed state better than when a private army, banned by the country’s laws, attempts a coup against its creator. This is exacly what happened when Prigozhin had his Wagner troops take over Rosov-on-Don and march towards Moscow. They passed by several cities and villages which hosted military bases without being stopped. On some locations, they were instead saluted and cheered upon. The troops that joined from Donbas, were greeted by the border guards, and his national guard remained passive during the mutiny/coup attempt. Prigozhin apparently had some support from one of the highest russian military commanders, Surovikin. Therefore, putin tried to tighten security.

A nervous little dictator

Source: ISW. https://www.understandingwar.org/

putin is weak

putin probably hopes that the execution of Prigozhin will strengthen his position. It won’t. The former US ambassador to muscovy, Michael McFaul, portrays the little person as weak.

This is an opinion shared among many who know russia well, for example Konstantin Sonin in this Al-Jazeera article where putin’s possibility to remain in power is questioned. Many analysts discuss the eventualities of a russian civil war. Among them is Ed Lucas, who thinks that another “Time of the troubles” have already started. Among the many potential contenders for the kremlin or parts of russia, is Kadyrov. In case of collapse, Kadyrov will try create his own sovereign Caliphate. The many potential coup makers have made putin very nervous. He now desperately tries to make everyone carrying a weapon to swear allegiance to him.

Strong leaders in control of the means of force in their countries do not need to do this. putin is weak. The Prigozhin mutiny would not have taken place in a proper totalitarian state, which putin has tried to create. In such a state, the secret police, by infiltration, would have stopped mutinies like Prigozhin’s before they get off the ground. It is astonishing that FSB in contrast to KGB, failed to infiltrate and stop Prigozhin at an early stage.

Oligarchs with private armies

The events described above, show what a complete failure the little person in the kremlin is. The same person who created the Wagner group and allowed Prigozhin to run it, has also allowed the creations of more private armies. As an example, read the Institute for the Study of War’s (ISW) briefing on 14 August 2023, which discusses the oligarch Rosenburg’s private military company’s, Convoy, relation to the regular army. That relationship does not give the regular army the possibility to draw from Convoy’s resources. Convoy has its own areas of responsbilibity and command structure.

Oligarchs with an appetite for military adventures have taken advantage of putin’s lack of action and control. There is now an market for mercenaries in muscovy, as detailed by Jack Margolin. There are a number of private armies, some of them have developed from organisations once created by the GRU. It is very difficult to understand how this complex myriad of armies, military organisations, and militias that are illegal under muscovy law, can exist and operate. According to Alexandr Galts, there is no joint and unified system of command of all Russian forces

This is surprising to say the least since he has prepared the invasion for 20 years. To being with, he autocratizised muscovy.

20 years of autocratization.

When the little person was installed as president by Yeltsin, he had been in the kremlin some years. So, he knew where to begin his attacks on the fragile democracy. After gathering the oligarchs and telling them that they could keep plundering russia on the condition that they stayed out of politics, he began to take control of the media immediately when he became president. Then he abolished the judiciary's independence, manipulated elections, clamped down on the civil society, academia, journalists, opposition leaders and parties. Varities of Democracy allows for graphing his efforts over time.

Autocratization in muscovy 2000-2022.

Source: https://v-dem.net/data_analysis/CountryGraph/. Note: All indicators range from 0 to 4 where 0 indicates a situation which you would find in a democracy and 0 a situation you would have in a dictatorship. Detailed information is available on the V-dem’s web site.

The demonstrations against the fraudelent elections in 2011/2012 and the Maidan revolution in Ukraine, led to visible efforts by the russian regime to oppress the own people. All other indicators of freedom and righs converge towards zero too. The presidential electons next year will be farcical.

In a post I wrote more than three years ago, "How putin destroyed russia", I showed in more detail how putin has autocratizised russia.

While he focused on that project, he did not have to do much about the economy because oil prices developed in his favour at the beginning of his rule. The ignorance of economics and reluctance to introduce growth-enhancing reforms have had a price. The russian economy is underdeveloped with a low-tech industry having problems producing advanced products. Therefore, it is also very reliant on imports for its production.

20 lost years in economic development.

I have written extensively about the inefficient and low-tech russian economy. It is a consequence of putin’s reluctance to introduce growth-supportive reforms. He’s never been interested in growth outside the energy sector, as I wrote in the post “Russia - a technology superpower or a shithole country?”

The main barrier is of course Putin’s lack of willingness to reform the Russian economy. Apart from in the beginning of his first presidency, Putin has not undertaken any reforms that would change the rent-dependent economy (Gaddy & Ickes (2005,2010)). The rents are the profits earned from the extraction and exporting of oil and gas. These rents are redistributed by the regime which means that rents are distributed to where they are needed to balance the power elites. The beneficiaries of the rents are very often loss-making companies which are dependent on subsidies for their survival and represent important political support for the regime. This system creates a distorted allocation of resources, inefficiency and excessive costs of production that are borne by all actors.

…which is why Russia is a technologically retarded shithole country…

So, Putin’s rule has not only lead to the low innovation rate, but also to an economy which is characterised by a severely inefficient misallocation of resources, lack of competition, dominant state-owned firms, corruption and lack of rule of law. Therefore, Russia has become a low-productive economy since the end of the commodity boom as illustrated by World Bank (2015, 2016) and Oxenstierna (2014) and many more studies….

When you’re a little fascist who wants to restore an empire, this is a massive failure. Not only are russian industries low-tech and not able to produce as advanced products as our industries, but putin’s failure also made them dependent on imports of intermediate products from our industries. The largest dependence on foreign suppliers is found for Water Transportation Services. Yes, that aggregation of industries consists to a large extent of services provided by ships carrying muscovy’s oil. That is annoying for putin since the G7 price cap works through the insurance costs for ships carrying his oil.

Domestic and foreign value-added shares in Russian final demand 2018. (%).

Source: OECD database. Trade in value added indicators. Note: the information in the figure is based on “Indicators based on the origins of Value Added in Final Demand” https://www.oecd.org/sti/ind/measuring-trade-in-value-added.htm

For all industries, the foreign share in final demand is 20%. It’s higher in final demand for total manufacturing products, 40%. And even higher in critical manufacturing necessary to produce weapons and other instruments for Putin’s murder machine. Foreign value-added accounts for two thirds of Russian final demand for computers and electronics.

More details can be found in my post “Putin’s mistakes”.

Corruption is double-edged sword

The putin regime is based on corruption. That is the glue that holds russia together. In the beginning of his dictatorship, putin summoned the oligarchs and permitted them to continue to plunder ordinary russians as long as they stayed out of politics and paid tributes to him. He gets a cut in all major business deals and transactions in russia. And this means that everyone beneath him is corrupt. Business deals, especially public purchases by governments on different levels, require authorisations, permits, inspections, from and by many different public entities. In order to get a contract, you need to pay a large number of people large sums of money. In case of disputes between the parties, judges can be bought to rule in your favour in kangaroo courts in a country where Rule of Law is absent, as Magnitsky experienced. In short, russia is a Kleptocracy as Anders Åslund shows in great detail in his book.

In our societies we have institutions that give provide incentives for growth. But

growth never interested putin, on the contrary.

It is not in Putin’s interest to create such institutions. On the contrary, that would threaten the interests of Putin’s allies. Free entry to markets and competition from new innovative firms create losers. And when the losers are among the economic and political elites with close links to the Kremlin, it is a more politically challenging problem than spurring productivity growth and increasing ordinary Russians’ welfare.

But corruption is a double-edged sword which putin found out when his three-day war failed. Large sums of money allocated for bribing Ukrainian military officers and government officials were stolen by FSB officers who sent false reports back to the kremlin. Instead of new drawn maps showing actual roads, military infrastructure and locations, russian troops had maps drawn up before the soviet union collapsed. Food rations were way past expiration days, vehicles and tires fell apart, broke down or just ceased to function since the money that was allocated for maintenance, was stolen by the military. And due to corruption, the military’s large-scale military exercises Zaped were completely useless and largely for show.

Corruption killed Zaped

Source: https://twitter.com/DefenceHQ/status/1696035180488651202?s=20

These are the consequences of the weak state of Russia, the malfunctioning of the Russian economy with its low-efficient military industry. These are characteristics you find in a society with pervasive corruption. Corruption which is informally sanctioned by Putin who is has shaped the Kleptocracy aka Russia.

In the post above, I write extensively about corruption in muscovy and its impacts on the society and military. Corruption has saved Ukrainian lives by making putin’s war machine less efficient but also cost Ukrainian lives as the missiles he’s using are not famous for hitting any targets with precision.

Instead of an empire, putin gets a collapse

I share Anders Åslund’s astonishment how someone so obviously inapt could become president of russia. He got lucky in the beginning with increasing oil prices but not tried to improve the mal-funcioning economy since that would be counter productive for the rent-seeking economy run by oligarchs supporting him. putin has always put loyalty before competence, and therefore relied on close circle of people he’s known for ages.

These people, former FSB thugs and corrupt friends from Stink Petersburg, constitute his “council of advisers”. It is from them he receives most of his information and it is based on that he makes his decisions. This worked poorly before the full-scale war, and it is detroying russia now. His decisions have cost the lives of hundreds of thousand lives, caused a mutiny by Prigozhin, made his oligharchs with private armies nervous, made russia a pariah country, Africa poorer, the EU less energy dependent, and enlarged the NATO.

russia is on the brink of collapse. It is only a matter of time. China will be there to pick up its pieces. But that’s going to cost putin territory. Chinese mapmakers have already begun to change the names of cities close to its border, and once part of China, back to their old Chinese names.