High stakes in Russia’s corruption battle

Elena Panfilova
28 July 2008

How do you define corruption? And how does the current anti-corruption crusade define it?

Corruption is a very broad term. It covers the misuse of public powers for the purpose of gaining personal profit and personal benefits. The word ‘public’ is very important here, because you have to remember that public powers and public possibilities can be very different things. But if you are in public service in whatever capacity, you should not use your position for personal enrichment. This is probably the most general definition of corruption.

But it is not a legal definition. It is not the definition contained in the Council of Europe’s convention, for example. The convention sets out twenty guiding principles for the fight against corruption. These give a very detailed definition which all sorts of other subsequent conventions have used as a reference. We have now signed up to the Council of Europe Criminal Law Convention on Corruption and the UN Convention against Corruption. But as to how Russian legislation will define corruption, I do not know. This is still under discussion.

What definitions does Russian legislation have to offer?

Russian legislation does not define corruption at all. The word does not even figure in the statutes. The battle against corruption in Russia is a sort of never-ending story. We’ve been circling round and round the idea of an anti-corruption law in Russia for the last fifteen years. A great many drafts have been produced, submitted, withdrawn, even voted on, but Yeltsin vetoed the law. Then a new draft was submitted. Then it was returned in the second reading. Then in 2000, yet another draft was submitted, returned, submitted again, examined, and buried out of sight.

In one way or another these draft laws all came up against the question of how to define corruption.

Who is going to fight corruption?

That’s the big issue. We can’t just ship in from Mars a couple of trainloads of honest law enforcement officers, politicians, judges and journalists, who will write honestly, pass judgement honestly and so on. We’ve got to work with what we have. But there is always the old carrot and stick method.

If the political leadership is serious about tackling corruption we could achieve some real results. This would not happen overnight, of course, but we could certainly achieve something in the long term.

Symbolic or real?

However, there’s a danger that any campaign will be limited to a ‘soft’ fight against corruption, one that is symbolic or simply declarative. This tactic has worked in many countries. TV shows, demonstrations, meetings, conferences, round tables, seminars, thousands of books, interviews with anything that moves – all feeding a wave of anti-corruption fervour. Then you toss in a couple of prominent anti-corruption arrests to show that something is being done. Whether the cases hold up or fall apart when they go before the courts is the least of their concerns. What matters is to go through the rituals.

Where has that happened?

In all sorts of countries. We’ve done it more than once ourselves. Ukraine, Armenia and Azerbajan all had campaigns like that in the early 2000’s. In the 1990’s they were happening all the time. But it didn’t take them long to understand that you can only get away with that once. Even the second time round, people won’t buy it. And we’ve been round the course more times than that.

That’s the first variant. Then there’s the real fight against corruption, the kind that hurts. This will only happen when those at the top decide that Vasya, Petya, Kolya and Sasha may be our great friends, but if we want to deal with corruption systematically, we’re going to have to rethink some of the rules for dealing with them.

Taking a decision like that is a very painful business for the political leadership. It’s painful because Kolya, Petya, Sasha and Vasya, who are all terrific fellows, could end up falling victim to this same campaign, but so what? It is precisely this ability to take decisions that may be painful for one’s own people, but useful for the country in the long term, that distinguishes the real leaders from those who are merely decorative, the strong politicians from the weak ones.

I don’t know if our politicians have the nerve to take this step. I don’t know how strong our political class is, because so far they haven’t been in any hurry to show me. But at least they’re not stupid. They must understand that this habit of the nation’s wealth disappearing into people’s pockets isn’t going to get them very far. I think they know it’s got out of hand, this business of selling oil, tucking the proceeds away in people’s pockets and tossing society a few handouts. They know that’s only going to work in the short term. But there are also long term strategies.

How to fight corruption?

If you asked me what we really need in order genuinely to fight corruption, I would say that we need to make ourselves more competitive. The people in power here are not poor and they want to live long and happy lives and protect their property rights. But you can’t protect property rights unless you tackle corruption.

It is in their interests to legalise all manner of income and property. Otherwise you and everyone around you will be constantly running around with this ‘under the table’ money, living in these ‘under the table’ villas, always fearful that someone’s going to come along and confiscate it all. So there are concrete incentives to fight corruption systematically. And I mean considerable ones. We’re talking about numbers with a lot of zeroes here.

But that’s only relevant to those at the top. As for the rest, that’s where the carrot and stick come in. One thing’s got to be made absolutely clear: you used to be able to go into the street and squeeze someone for money for your kids’ holidays, or give someone planning permission and use the kickback to build yourself a villa, buy a new Porsche Cayenne or some such. But that’s all over now. Now, there’s a list of rules which have to be obeyed. If you break them, you’ll be saying goodbye to your job forever and there’ll be no way back.

On the other hand, you could choose to live differently, more modestly. Yes, you won’t have the old impunity, the sudden showers of corrupt and dirty money. But you’ll be secure in the knowledge that in return for your irreproachable years of work, you’ll be socially and financially secure. Work another ten years and you’ll be able to buy yourself a home, good medical coverage, and after a few more years you’ll be able to put your children through the country’s finest universities. Another 10 years of spotless service and you’ll have earned yourself an excellent pension. This is especially important, because a lot of civil servants at the moment think that if they do not take bribes, they’ll end up scavenging the streets to finance their old age.

When will it happen?

People often ask me how soon this effective anti-corruption legislation is going to be drawn up and put on the statutes. Will it be in July or in August, in three days or five? Everything we’ve been talking about takes a long time. If we’re lucky it might kick in by the end of 2009. It’s going to take at least a year, even when the law is passed and activated. We’re talking about a huge administrative machine. Anything it does takes time. There’s just no way of making it move fast. In this respect, it’s the same in Russia as everywhere else.

But the bureaucratic legions ready to sabotage any anti-corruption reforms are not going to sit idle in the meantime. Already, articles are appearing saying that we don’t need this kind of upheaval, that the Russian economy won’t be able to bear it...

International parallels

Which country’s corruption system most resembles ours in form and content?

Firstly, those of all the former Soviet republics. Secondly, Latin America.

What specific measures have worked in the countries that have carried out successful anti-corruption reforms?

Each one is different. The Estonians, for example, built everything around electronic government. You remember the Electronic Russia project? Documents dealt with on-line, decisions made on-line, electronic signatures. If some deputy minister or head of department in some ministry decides say, to pay for 10,000 cubic metres of cement for building a state school out of the national budget, it shows up immediately in the electronic system with his signature. You can always see who decided what and when. In other words, everyone can see everything (with the exception of confidential matters). And if it turns out that a school wasn’t built and the money wasn’t spent on cement, you can see who did this and why. You could call this a sort of constant public control. With the government doing everything on-line, the parliament has to join in the process. The situation in Estonia has gradually undergone tremendous improvement. What’s more, they had a big incentive, namely to join the European Union.

All successful anti-corruption reforms begin with good motivation. Reforms are unsuccessful when there is no motivation, if the decision to fight corruption was just taken for the sake of it.

In the USA the great motivation was the Great Depression. Roosevelt had to save the country, and he couldn’t do that without tackling corruption.

He reorganised the entire law enforcement and public service system. This was when the concept of state services was replaced by that of public services – the idea of serving the public. Public servants were made accountable and a system of checks and balances, of carrots and sticks,was put in place. We all know that there is plenty of corruption in the United States today, of course. But it is easier to buy a member of Congress there than say, a traffic cop. The whole structure of relations between the state agencies and citizens has genuinely been transformed. No one would dream of giving money in a hospital or school at the ordinary everyday level, although you might try doing this in parliament. In other words, motivation pushed them in a particular direction.

In the case of Singapore and Hong Kong, corruption could just have wiped them off the face of the Earth. The money was all disappearing into the pockets of corrupt officials. They chose the law enforcement road. They set up specialised services that became the terror of all civil servants. These services concentrated mostly on two things: monitoring and catching corrupt officials, and public education.

What’s at stake in the fight against corruption

What has put corruption on the agenda today?

It hasn’t just appeared on the agenda. It is a long-playing record. If you take a look through all of President Putin’s addresses to the Federal Assembly over these last years (a dubious pleasure), you will see that he talks about corruption every year. What’s more Russia has signed up to a number of commitments, by dint of having ratified the Council of Europe and UN anti-corruption conventions. They’re going to have to start doing something about these bodies, reporting to them. An outside factor has appeared on the scene.

When Putin stepped down, Dmitry Anatolyevich [Medvedev] inherited the obligation to do something about these conventions we’ve ratified. It’s not the most pleasant of legacies, but in some ways it makes his task easier. Technically speaking, it is quite straightforward. You have only to find specialists who can clearly evaluate how things stand in Russia today on the fight against corruption – and there are enough such specialists in Russia. These international conventions set out all the steps that need to be taken.

Nor will it do any good making a song and dance about us having our path, about the West having no right to dictate to us, as some of our fanatical patriots are wont to do. It is absolutely in our interests to follow the model proposed. It contains nothing that’s terrible, nothing that’s unacceptable. Our corruption has no specific national colour. It’s just the same as corruption in the United States, Zimbabwe, Japan or anywhere else on the globe.

Corruption is on the agenda today for ideological reasons too. If you study the list of problems that President Putin drew up when he was first in office in early 2000, you will see that he has fulfilled almost all the tasks to which he commited himself publicly, and even some of those to which he did not publicly commit, but which were clear from his actions.

He wanted at least some kind of pacification in Chechnya, and some kind is exactly what he got. He wanted to vanquish the oligarchs, and he did indeed vanquish some particular oligarchs. He has restored Russia’s greatness, though it is debatable whether this is his personal achievement or that of high oil and gas prices. People often forget that in 1999, when Yeltsin handed power to Putin, oil was at $17 a barrel, and today it is at $130 a barrel. The powers that be are only very indirectly responsible for a great many of our achievements, including economic and social stability. These have more to do with the fact that the world economic situation is favourable to is. Whatever view you take of that, Russia today is enjoying a degree of social stability.

In short, Putin resolved all the problems on his agenda except one. He wanted to fight corruption but he did not succeed. Instead, we saw the usual symbolic measures: the showcase arrests of the ‘werewolves’ in summer 2003, a host of conferences, symposiums, seminars, publications, decrees and so on. Now Medvedev has inherited all this. He knows full well that if he’s going to prove himself as a strong leader, equal to his predecessor in the eyes of his countrymen in this glorious and sorrow-filled job, he’s going to have to do something that will have as big an impact on the country as what Putin achieved.

Fighting causes, or consequences?

The fight against corruption can go in one of two directions. You can fight corruption itself, or you can fight those who commit corruption. To put it simply, you can fight the causes, the system. Or you can fight the consequences, specific individuals. Those tempted to see the fight against the old oligarchy as a fight against corruption should remember that because the system was left intact all that happened was that new oligarchs replaced the old ones. What difference does it make for ordinary people whether Khodorkovsky’s running the country or those in power now?

Why does Medvedev need the corruption issue? He needs it because if he gives the system a bit of a shakeup it will put him on a par with Putin in the eyes of ordinary people. In other words, he will become a political figure in his own right. The only real way to do this is to carry out some kind of Herculean labour, and he has taken up an entirely suitable issue.

It’s happened in many other countries before now. You just have to look at the campaign programmes of the winning candidates over recent decades in France, Italy, Spain and Britain. What could be better than riding to the heights of political power as the anti-corruption knight in shining armour? Roosevelt did it, as did De Gaulle, many years later. If you can make your name in this battle, and rein in the corrupt elites, your name will go down in history. I think Medvedev wants to go down in history.

Insuring Russia against collapse

If you need a purpose to motivate a genuine anti-corruption campaign, what is ours today?

The goal is insuring that Russia does not collapse. We’re all aware that we’re sitting on a liquid cushion of petrodollars. We’re balancing on a very shaky bridge of unfinished social reforms. Seriously though, the goal is not so different from Roosevelt’s in the USA. The only difference is that they started trying to save the situation after everything had collapsed. We’ve got a chance today to rescue the situation just before everything collapses.

Imagine what’ll happen if there is any change in the economic outlook with things as they are. Half of all property rights and economic contracts are based on nothing concrete, just informal agreements. This is a very unstable and vulnerable situation. If some enemy or other suddenly decided to bring us down, they wouldn’t have to organise an ‘orange’ revolution or bombard us with their military toys. Using corruption as their way in, they would only have to look closely at a lot of our big state contracts, and non-state contracts too, and not even just big ones. Everything would start coming down like a house of cards. Our purpose is to insure ourselves against a repeat in say five, seven or ten years time of what we lived through in the 1990’s.

Glued together by kompromat

Once anti-corruption campaigns get underway in the regions, arrests are quick to follow. In which regions will most of these happen? And will these arrests really be about corruption?

I don’t know where they’re likely to make most arrests. But I know who’ll get arrested. If we were to write a great big tome on corruption it would be peppered with footnotes all saying the same thing: we know very well that the fight against corruption is a perfect instrument in political battles.

If someone is arrested for corruption this does not necessarily mean that the region in question has launched a campaign against corruption. It could just as well mean that the political battles in the region are particularly fierce. What better way to bring down or get rid of a candidate than accuse him of corruption? You don’t even need to prove anything. Even if it later turns out that the accusation was groundless, the candidate’s reputation will suffer.

In some cases local gangsters will be settling scores. In others, it will indeed be a political battle, and you should look to see when the next election is due. In some places it will be a genuine fight against corruption. An honest person may even come to power and be really trying to clean up to the region.

Could a large-scale anti-corruption campaign end up being high-jacked for such ends?

It might be used to arrest governors and mayors. There are already several on federal wanted lists hiding out there somewhere. Mayors and governors are good for showcase campaigns because you can always dig up dirt on them. You don’t even need to look. You can pick a place at random on the map. Mayors and city officials are easy meat. The law enforcement officials don’t even have to make an effort to find decisions that infringe the law: unlawful land allocation, illegal planning permission for businesses, misuse of budget resources or red tape, abuse of ordinary citizens, not to mention personal enrichment in the form of a house and car quite out of keeping with the salary earned.

This whole system, this hierarchy that’s been built over recent years is held up politically and economically by a chain of corruption. It is held together by the dirt that everyone has on everyone else. Mutual loyalty stops conflicts from getting out of hand: you keep quiet and others will keep quiet about you.

But at the same time, when someone appears who’s got the political will to arrest those guilty of corruption, things start coming to light. Then the mayors find themselves in the firing line. You can go after anyone, not just the mayors. But however successful you are, this will not actually change anything.

Yes, it is easy to use the fight against corruption as a tool for persecuting dissidents, divvying up resources, re-divvying them up, or carrying out witch hunts. It depends what those in power are trying to achieve. It is far more likely that things will not go very well than that everything will move in the right direction. There are more than enough people eager to make use of the ‘symbolic’ type of anti-corruption campaign. Or indeed to use the fight against corruption as a cover for furthering their political or economic interests.

Right now government spokesmen keep saying to me: ‘But you don’t seem to understand, this time its for real’. So what does that mean about the other campaigns? That they weren’t for real?

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