HOW DO YOU SLAY A DRAGON?

Unlike a socialist state, a welfare state doesn’t try to make everyone equal in order then to work out who are more equal than others. The aim of a welfare state is to give everyone an equal chance of development and success. Had I written this text 15 or 20 years ago, I would probably have put a full stop after that. But given the experience that I’ve gained today, I’ll put a comma. Equal opportunities to succeed should be given to all those who are ready to use them. But those who cannot do this, or just don’t want to, should be given minimal guarantees. Without this humanitarian component, no welfare state can exist, especially in Russia.

To summarise briefly, let me explain why I believe we need a left turn at the current stage of development of Russian statehood. We need it in order to remove the political factors that are leading to an explosive growth in social inequality, and start to follow a consistent path aimed at reducing this inequality. Naturally, I consider the most important thing that we need to do is to get rid of Putin’s system, with its “raiding by the siloviki ”. This allows for the redistribution by non-economic means of national wealth among groups of people who are loyal to the regime, leading to it being concentrated in the hands of a small clique who are running the state.

Once this first condition has been swiftly carried out, the temporary government should resolve the question of establishing social control over resource rent. As I wrote above, I see the most sensible and efficient way of doing this as being the creation of life-long insurance savings’ accounts for the people, into which the windfall profits from raw materials should be paid in various amounts. Deciding this issue will be just as important as was the question of property that took place during the social revolution in Russia at the start of the twentieth century. But this time it must really be solved in the interests of the whole nation, and not just its “leaders”. This is the only thing that will give the temporary government the genuine support of the people as a whole, and create that political “safety cushion”, that will allow it to carry out all of the long overdue economic and political reforms.

Chapter 11. How Do We Achieve Economic Justice:

Nationalisation or Honest Privatisation?

The total restoration of social justice is impossible without the restoration of economic justice. In the widest sense of the term, economic justice is the most important part of social justice. And in the narrower sense, it signifies equality, not so much in the distribution of national wealth, so much as in having access to the basic means of production. In other words, it’s economic justice that gives people a more even chance of becoming rich.

The logic here is simple: those who hold the basic instruments for the production of wealth, inevitably have a massive advantage when it comes to their distribution. And this can’t be balanced out by any corrective measures such as taxes or subsidies and so on.

Therefore, the question of property – who should hold the basic means of production of national wealth, and on what basis – always had, has, and will always have the greatest significance for society. Whatever government takes over from Putin’s regime simply cannot ignore this.

There’s no need to explain that the privatisation process that began in Russia in the 1990s and in reality is still going on, led to the destruction of economic justice. In an instant it created a deep inequality for different strata of society in terms of access to the basic means of production. It proved very difficult to get rid of this. This is not only an objective factor that any future government has to face up to (as does the current one), but also it’s a challenge that it must tackle.

I should add from my own observations that for various post-Soviet generations privatisation was, and clearly remains, a serious psychological trauma that has left a deep scar on society’s consciousness. So in any crisis, the question as to who owns the bulk of Russia’s national wealth and why it’s in the hands of these people will always rise to the surface. And it will always be impossible to avoid answering this question – and so it should be.

Looking back with the advantage of hindsight at what happened more than a quarter of a century ago, I consider that the privatisation of the Soviet economy – or, to be more accurate, the removal of state control – was an inevitable and justifiable action. But I suggest that the way in which it was carried out was unacceptable for society; unfair economically; and dangerous for the economic and historical development of the country.