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The Mordovian candidate

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As the economic crisis hits Russia’s regions, Samara’s governor is trying to hold on to the kingdom he’s built for himself.

 

Michael Lawrence
22 March 2016

Last month, Nikolai Merkushkin saw off his 65th birthday in style. Local newspapers printed illustrated special editions to mark the governor of Samara’s birthday, and television stations broadcast a documentary film dedicated to the region’s leading man, In the epoch’s lens

Merkushkin’s office is no small role. Samara is the sixth-largest city in Russia, straddling the river Volga between Astrakhan and Volgograd. Together with the neighbouring cities of Syzran and Tolyatti, it forms a industrial and economic centre with a population of over three million.

While journalists and public officials praise Merkushkin, city residents say that Merkushkin’s rule hasn’t done much for Samara. Instead, under the banner of United Russia, Merkushkin has created a mini-state of his own — with its own laws.  

Censorship and suppression of local dissent are rife here

In his three years as governor of Samara, Merkushkin, who is a member of the supreme council of Russia’s ruling party, has actively introduced a strong-arm management style tried and tested in neighbouring Mordovia, which he governed from 1995 to 2012.

Censorship and suppression of local dissent are rife here, and this fits into the Kremlin’s preferred method of managing Russia’s regions: the centre approves a governor who is otherwise left to his own devices.

The local ministry of propaganda


Samara’s governor was born in the ethnic Moksha village of Novye Verkhissy, Mordovia, in 1951. A former electrical engineer, he slowly crept up the ranks of the region’s Soviet-era bureaucracy, becoming the head of its Supreme Soviet in 1990. 

As an outsider to Samara, Merkushkin naturally had a reputation to build. Local papers, radio stations and TV frequently report that Samara has become a leading region Russia under Merkushkin’s leadership.

In fact, in terms of unemployment, suicide, drug problems and other indicators, Samara is far from the best in the Volga region. No one, it seems, is interested in the real state of the region’s economy, where agricultural enterprises, livestock farms and pickling factories are all under severe pressure.

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Nikolai Merkushkin, a native and former head of the Republic of Mordovia, has been governor of Samara region since 2012. Photo (c): Ramil Sitdikov / visual RIAN, 2015. All rights reserved.The governor aims to convince his fellow citizens otherwise. At the start of 2016, the Samara authorities decided to ensure that all public sector employees took out subscriptions to the regional government’s newspaper, Volga Commune.

This subscription costs $70 (£49), a hefty sum for public sector workers. Others get it delivered for free, though, as the regional government has ordered that Volga Commune should be delivered to people’s homes in Tolyatti and Samara (whether they want it or not).
 
Meanwhile, the managers of public institutions, whether it’s a hospital, factory or school, had to inform the region’s information policy department by mid-February of the number of employees who’d signed up. Aside from these “performance indicators”, there are other “incentives”, too. A principal at one of Samara’s schools told me anonymously that officials from the department of education threatened to fire him if less than 25 of his employees took out subscriptions.

In terms of unemployment, suicide, drug problems and other indicators, Samara is far from the best in the Volga region. 

The students are involved too. Before lessons start, Samara students have to retell articles from the Volga Commune in front of the class. This is problematic, given that the Commune writes of the record economic achievements of Merkushkin. 

Students in rural areas can see these achievements for themselves, though: village schools are closing as part of a “consolidation” programme, whereby the students of five rural schools are transferred to a single school, often hard to reach by bus.

While Volga Commune declined to tell me the exact number of subscribers for “reasons of commercial secrecy”, it seems the paper’s readership could reach the 300,000 mark after these measures.

Pride before the fall

Merkushkin regularly visits the nearby town of Tolyatti, where he speaks to the workers of the Volga automobile factory (VAZ), promising them there’ll be no new waves of firing. With wage and benefit arrears rising, it seems the future of this once-proud Soviet manufacturing town is at risk.

Since 2014, the number of employees at VAZ, Russia’s main car factory, has dropped by 20,000 workers. The factory now employs 45,000 people. A new four-day working schedule, introduced in mid-February, has cut wages by 20%. And further sackings are expected, after the head of the official trade union stated that the factory was carrying 4,500 “extra” workers in February. Its yearly outputs have dropped by half.

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Despite these cuts, there’s only 8,000 people registered as unemployed in Tolyatti, and volunteer organisations claim that there’s at least 10 times as many unemployed. People claiming welfare (5,000 roubles, or £49) say that they haven’t received their payments since December 2015. The authorities blame this delay on the economic crisis. Soviet-era mosaic, Volzhsky Region, Samara, 2005. Photo CC: William Veerbeek / Flickr. Some rights reserved.Since July 2015, workers — some 3,000 of them — of the bankrupt AvtoVAZagregat company, which manufactures car parts, and three connected factories have not received their wages. To survive, some people collect food thrown out by grocery stories, and take meals at free cafeterias.

According to the local authorities, these financial problems at VAZ and AvtoVAZagregat are down to the international situation. Both factories ordered parts from Turkey. And after the collapse in business partnership between Turkey and Russia last year, VAZ has been forced to stop production for two years due to a lack of components.

Meanwhile, there are rumours going around among workers that come summer, the factory will be nationalised and then declared bankrupt. Given the company’s declaration that its after-tax profit for 2015 would come to $930m (three times less than 2014), this scenario seems possible.

Pressuring the public sector 

In autumn 2015, Merkushkin promised that he would cut wages to the region’s public sector workers. However, the onset of the economic crisis has compelled the governor to look at his promise again, submitting to the Kremlin’s austerity policies. 

In January, Samara’s public sector received wages without their usual bonuses, including for length of service and the “stimulation” package, i.e. a certain percentage of total wage paid for achieving targets.

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With a serious drop in wages received, Samara’s public sector unions planned to hold demonstrations against wage cuts at the end of February. Soon after this intention became clear, trade union leaders were warned that participation in this demonstration would be considered a violation of work discipline. The directors of schools, hospitals and other public sector institutions threatened to fire people who took part in this kind of meeting, and it was decided to forego the meeting. Sunset in Samara city centre, 2013. Photo CC: Artem Svetlov / Flickr. Some rights reserved.Instead, Merkuhskin is putting pressure on the public sector with a new initiative — to launch a system of local bonds for Samara by mid-2016. These bonds will be issued at 10% interest (less than the going rate in banks), and the governor proposes to pay part of public sector workers’ wages with them.

Samara’s local budget does not guarantee the value of these bonds, and they don’t fall under Russia’s programme of obligatory investment insurance. Unsurprisingly, experts say they’re a risky investment

Merkushkin will open his coffers for United Russia, but is more in interested in using state funds for his own enrichment.

There’s more pressure, too, ahead of Russia’s parliamentary campaign this September. Should United Russia’s candidates win in Samara this autumn, the authorities have promised prizes for school principals and employees involved in the elections, as well as extra funding for schools and wage bonuses.

As local sociologist Vladimir Zvonovsky told me: “Governor Merkushkin will control the State Duma elections personally.”

Welcome to Merkushkin town 

Merkushkin will open his coffers for United Russia, but is more in interested in using state funds for his own enrichment. Since his very first day on the job, Merkushkin has come into conflict with Samara’s financial and political elite.

As a result, Merkushkin’s team instead consists of dependable politicians he worked with back in Mordovia. Companies from Mordovia have squeezed out local business; the governor has been actively lobbying for the interests of various companies that are controlled by his clan.

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For example, Samara’s stadium for the 2018 World Cup, to which the federal authorities have assigned billions of roubles, is being built using materials from Mordovia. Chicken and farm produce in local shops have been replaced by agricultural goods from Merkushkin’s home turf. Governor Merkushkin shows Vladimir Putin Samara’s plans for new stadiums for the 2018 world cup, 2014. Photo CC: Kremlin.ru / Wikimedia Commons. Some rights reserved.Only the Kremlin, it seems, can change Samara’s path. And recent events have presented an opportunity to remind Merkushkin where he stands.

Last October, three well-known bloggers, Dmitry Begun, Oleg Ivanets and Natalya Umyarova were arrested on suspicion of blackmail and extortion — the first time that bloggers have been arrested in Russia for blackmailing the people they write about online. Allegedly, Begun, Ivanets and Umyarova had taken three million roubles from a local businessman in return for not spreading incriminating information about his company. 

Four months later, during an initial investigation into the case in February, Begun gave evidence against the region’s governor, stating that Merkushkin himself had ordered him to slander federal-level bureaucrats on the Internet. The list is impressive: vice-speaker of the Duma Sergei Neverov, Russia’s minister of sport Vitaly Mutko, Gennady Zyuganov, leader of the Communist Party and Vyacheslav Volodin, first deputy of the presidential administration. 

Nobody will listen to Begun’s claims. According to a local deputy, the investigation is being carried out with some “loyalty” to the governor. 

While the governor’s birthday didn’t take place without a scandal, few changes look likely before the elections in September. For its boss, all will be well in Merkushkin town.

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