SUMMARY

This is the second OZ book devoted to the theme of property, and its subtitle reads “an experience in transformation.” The book contains articles describing the social and economic results of the privatization process, and the efforts to restore justice that was interfered with in cases of public property sales pursued (or conducted) by the governments of progressive countries. Some stories also deal with the radically changed property regulations in Russia.

Participants in the roundtable “Property Issues in Modern Russia” — Alexander Buzgalin (Editor in Chief, Alternativy Journal; Professor, Moscow State University), Leonid Grigoryev (economist; President, Institute of Energy and Finance), and Mikhail Delyagin (Presidium Chair — supervisor of studies, Institute of Globalization; Academician, Russian Academy of Natural Sciences) — discuss obstacles related to the emergence in modern Russia of a property relations regulatory system typical of advanced countries, and the paths by which the development of property relations regulations is likely to follow.

Marshall Goldman. “Piratization of Russia: Russian Reforms Are Coming Awry”. It is a synopsis of the recently published book by a prominent U.S. political scientist, who attempts to summarize the Russian economic reforms of the 1990s. The book is publicist-oriented and submits numerous references to scandalous publications in the Russian and foreign press for scientific analysis. Goldman’s conclusions refer to the reforms of the 1990’s as a complete failure, and that the Russian reformers and their Western advisers are to blame.

Anders Aslund. “A Comparative Oligarchy: Russia, Ukraine, and the United States”. The author offers a critical analysis of the policies pursued by the Russian authorities which unlawfully confiscated YUKOS assets. Aslund is even more stringent in his denunciation of the new Ukrainian government and its intention to radically revise the results of privatization. Based on a typological comparison between the newly-fangled Russian and Ukrainian oligarchs and the mid-19th-century U.S. “robber barons,” he suggests a fundamentally new approach to solving the “problem of the oligarchs” and the related corruption problem: political and economic bargaining due to be crowned with a compromise beneficial to all concerned parties — government, oligarchs, and most importantly, society as a whole.

Yakov Pappe, Chief Research Fellow at the Institute of Economic Forecasting, Russian Academy of Sciences, talks to Vitaly Kurennoy about the strengthening of the property system in Russia as a consequence to the integration of privatized fragments of the disintegrated Soviet economy into the global economic space. The state, he believes, is unable or unwilling to oppose this process.

Based on extensive empirical material, “Regional Property in Russia: Friends and Foes” by Alexander Pillyasov, analyzes the course of transformations of ownership of the main assets in the Subjects of the Russian Federation during the period 1992–2004. The article outlines the principal schemes of the transformations and identifies types of Russian regions in accordance with property rights configurations existing in them.

Lyudmila Presnyakova. “Economic Reforms in the Eyes of Russians: Yesterday, Today, Tomorrow”. The book falls back on sociological polls to demonstrate that the majority of Russians have a negative view of privatization in the 1990s and its consequences. In the first place, they see it as the state’s retreat from its paternalist obligations to the citizenry. Those polled call into question the legitimacy of the privatization methods and their economic efficiency. But the last few years show some indications of a conciliatory tendency. The author urges the corporate sector to meet the public halfway by demonstrating social responsibility and respect for the law.

Natalya Zorkaya considers Russian attitudes towards privatization and private ownership based on Levada Center opinion polls (before September 2003, Levada Center was known as All Russia Center for Public Opinion Studies, VTSIOM). A relatively high level of support for privatization was originally linked to the general social and political mobilization in the first years of perestroika. Since the mass consciousness lacked any clear idea on economic inevitability of a movement in that direction, support for privatization actually implied support for the current authorities. Society increasingly lost criteria for the understanding and evaluation of contemporary change as “space of glasnost” contracted and media became commercialized, thus washing away, among other things, the ground necessary for analyzing and estimating the reform-generated processes. The mounting disadaptation of the majority of the public and buildup in negative attitudes towards change, including market reforms and, in particular, privatization of major property, were accompanied by a step-by-step revival or renewed inertia of former values such as Soviet ideological constructs.

“Privatization as a 1990s Phenomenon” by Leonid Grigoryev considers international privatization record. Economic growth, it claims, was achieved in transitional economies that boasted a higher level of openness and rivalry, a better quality of corporate control and governance rather than the mass scale of privatization. Yet, costs involved in the seizure and retention of businesses by owners, who had borne no expenses while establishing their control over them, evidently should be regarded as society’s transaction costs in the process of full-scale transformation of property relations.

“Cleaning up after Privatization: Some International Precedents” by Rory A. MacFarquhar is devoted to problems of legitimization of privatized property. As a rule, the electorate views actions by governments organizing the sale of major public assets as largely unfair and erroneous regardless of mistakes actually committed. With reference to the experiences of foreign countries (U.K., U.S., Indonesia, Ukraine), it describes problems facing the authorities in connection with the necessity to restore at least some justice in the eyes of the public. It also suggests methods for solving such problems.

Andrei Kolganov considers privatization of public property in Russia and in Central and East Europe in the 1990s. Though similar in many respects, the processes were essentially different where both preconditions and rates and methods were concerned. With privatization preconditions better than in Russia, many countries in Central and East Europe practiced slower rates, thus making for truer asset evaluation, bigger investments, and greater transparency of privatization procedures. In sum, these factors played a role in mitigating economic and social consequences of the basic property structure transformation.

“Concentration of Property and Corporate Landscape of Modern World Economy” by Rostislav Kapelyushnikov provides a general picture of the corporate landscape of modern world economy. Guided by property concentration criterion, it singles out two basic types of major corporations prevailing in different world countries: one with broad stock ownership (Model W) and one with blockholder domination (Model B). It analyzes in detail the comparative advantages and disadvantages of these two alternatives, as well as the economic, legal and political factors which predetermine the choice of this or that variant. It also considers briefly the likely trajectories of further evolution of the specific corporate governance model that took shape in Russia in the tempestuous 1990s.

The OZ publishes an excerpt from the memoirs of Police Department chief Alexei Lopukhin, covering the “Mamontov affair” that caused a sensation in 1899. A well-informed contemporary tells how Finance Minister Sergei Y. Witte brought to ruin the big industrialist and patron of the arts Savva I. Mamontov. The story shows clearly that the big private property was extremely ill-protected against bureaucratic attacks in 19th-century Russia.

Interviewed by OZ, Yaroslav Kuzminov, rector of the Higher School of Economics, claims that Russia has not a single chance to achieve an upsurge in the traditional sectors of the economy, and that its future lies in developing the “intellectual sectors,” something that primarily requires a revision of the system of intellectual property rights.

“Who Owns Works of Art?” by art critic Konstantin Akinsha is devoted to a conflict between private ownership of works of art and public good considerations. The conflict originated in Napoleonic France at the time when The Louvre, the first public art museum, was organized, to which Napoleon ordered to bring art spoils from private collections his troops were looting all over Europe. The ownership of works of art became a particularly acute issue in the late 1990s, when numerous facts related to privately owned artistic values that had found their way to various public collections in the wake of World War II came to the surface.

Igor Stadnik. “The New Housing Code, Its Merits and Demerits”. The article discusses the recently approved RF Housing Code and amendments thereto suggested by State Duma deputy Galina Khovanskaya.

The Country of OZ Section

“The Negation of Russia” by the prominent ethnographer Valery Tishkov discusses the Russian crisis in the understanding of life, one that assumes a clearly destructive scope. The myths about “a dying Russia,” “a poverty-stricken Russia,” about poverty that generates terrorism are due to a considerable extent to weak social-science expertise which underlies the country image and feeds the media community.

The village of Svoboda (Freedom), Republic of Bashkortostan, came into being at the same time as the Soviet Union did. People representing 65 ethnic groups still live there. “My Small Soviet Union” is a story of the village as told by its inhabitants and written down by high-school student Aksinya Kozolupenko.

“In Sodom, and in Gommorah” characterizes the life of the hereditary surgeon Andrei Gerner. His story will be put at the base of a theatrical project. The OZ publishes excerpts from the monologue of the provincial doctor. “Europe Through the Back Door” by Sergei Kostyrko shares personal impressions of meetings with Russian and Ukrainian illegal migrants working in different European countries.

The new Russian state is in the second decade of its existence and is launching The Big Russian Encyclopedia. Its first volume will be called “Russia.” “Congratulations on the Encyclopedic Publication!” by Vladimir Belikov and Maria Akhmetova is devoted to both this and other reference editions of the recent period.