Russia today presents a very particular form of authoritarianism. The executive arm of the state is the dominant force in society, allowing no challenges from an independent business community, the judiciary, an empowered electorate, or free media. Yet the state itself is dominated by a variety of informal influence groups that vie for control of key assets. Atop this complex construction stands Vladimir Putin, the de facto “national leader” and de jure prime minister, who is formally subordinate to President Dmitry Medvedev and informally powerful, but far from all-powerful. The state holds elections and boasts representative institutions, but they mean little. The ruling elite has successfully deployed a deeply illiberal conceptual vocabulary to vaunt state power and denigrate the content, if not the appearance, of democracy. This resurgent Russian authoritarianism garnered significant popular support during the recent period of relative prosperity, but the global economic crisis brought that period to an end in 2008, and the system’s fate is now uncertain.

The core characteristics of Russian authoritarianism in its post-Soviet maturity are selectively capitalist kleptocracy, the dominance of informal influence groups, decorative democracy, and illiberal ideology. Together, these elements form an effective mechanism for maintaining elite control over a disempowered populace.

Russia under the current regime can be described as a selectively capitalist kleptocracy because it employs certain genuine components of a market economy, but only to the extent that they benefit, or at the very least do not hinder, a ruling elite engaged in practices that would entail criminal prosecution in any free-market society with a functioning legal system and an independent judiciary. These practices include outright theft of budgetary funds, pervasive graft and kickbacks on all major contracts, myriad tax-evasion schemes, and a welter of unfair business tactics based on influence-peddling, access to insider information, and the manipulation of ambiguous laws and pliant courts.

The term kleptocracy, which arose to describe overtly larcenous states in conditions of scarcity like Zaire under Mobutu Sese Seko, is an imperfect one in the Russian context. Outright theft played a prominent role in the emergence of the post-Soviet system, most grotesquely during the early rounds of privatization, but it is no longer a systemic hallmark. In its latest incarnation as a petrostate, Russia even managed to parlay high oil prices into a swelling stabilization fund and substantial hard-currency and gold reserves. Yet the spirit of kleptocracy, in which the machinery of the state serves private gain before public good, is a constant. A new term might be more accurate—perhaps “kerdocracy” (rule based on the desire for material gain) or “khrematisamenocracy” (rule by those who transact business for their own profit)—but for practical descriptive purposes, kleptocracy conveys the essence.¹

The degree of selectivity in Russia’s adoption of capitalism varies from sector to sector, but throughout the system there are elements of the free market mixed with nonmarket- driven mechanisms and pervasive government corruption,² particularly where state-controlled companies intersect with the global economy, or where privately owned domestic corporations must bribe high-level officials. State-run energy companies like Gazprom bring in hard currency through their interactions with foreign markets, use their profits to provide domestic consumers with energy at below-market rates, and generally redistribute revenues in ways that are utterly devoid of transparency and almost certainly dismissive of market concerns. Not surprisingly, the state-controlled energy sector has displayed a marked lack of innovation and an unwillingness—or inability—to pursue effective long-term development. Gazprom’s decision to maintain domestic supplies and export volumes by purchasing Central Asian gas instead of developing new fields in Russia is but one example of this problem.

In a selectively capitalist kleptocracy, heavy state involvement in the economy and a plethora of informal relations blur the distinction between high-level “businessmen” and senior “officials.” The distinction evaporates completely when, as in Russia, government officials sit on the boards of large state-run companies. Even where a formal division exists, businessmen must bribe officials in order to do business,³ making officials de facto participants in the management process, almost always to the detriment of corporate governance. High-ranking officials run sizable state-owned companies for private gain, amassing enormous wealth, although they must make efforts to conceal their riches from the public in order to maintain the illusion that they are, on some level, public servants.⁴

The result of this arrangement is the opposite of the level playing field that forms the foundation of a true market economy. One Russian wit summed up selectively capitalist kleptocracy with the phrase, “The elites want socialism for themselves, and capitalism for the people.” Andrei Illarionov, a former adviser to Putin, has quipped that the system involves the “privatization of profits and the nationalization of costs.”

Selectively capitalist kleptocracy is an effective mechanism for the maintenance of domestic control because it makes property rights contingent on the whim of those who can move the levers of state power. This serves a dual purpose, enriching the money-power nexus of politically connected insiders while forestalling the emergence of an independent and legally empowered business community. After the might of the state came down on Mikhail Khodorkovsky in 2003, Russia’s most powerful oil magnate soon found himself in a Siberian prison camp, and Yukos, his oil company, tumbled down the waiting maw of Rosneft, a state-owned oil company chaired by Igor Sechin, then deputy head of the presidential administration (and now first deputy prime minister, though he remains chairman of Rosneft’s board of directors).

A fine example of the subordination of business to the interests of the political elite came in July 2008, when shares in Mechel, one of Russia’s largest mining and metals companies, took a nearly $5 billion nosedive in a single day after Putin made an off-the-cuff remark accusing the company’s chief executive of shady dealings. Mechel escaped Yukos’s fate, but the market’s reaction showed that investors, weighing a few words from the prime minister against Russian legal protections for property rights and due process, knew exactly which side represented the safer bet.

The Soviet system, like the tsarist system it replaced, always retained a strong informal component. The actual influence of formal Soviet institutions often did not correspond to their nominal functions. When the Soviet Union broke apart, the collapse was uneven, with formal institutions imploding while the informal component managed to survive, mutate, and thrive. This lopsided breakdown was a fixation among political and economic theorists, who correctly insisted that a successful transition depended on the emergence of strong institutions. What emerged instead were strong informal influence groups, sometimes called clans. These formations, not institutions, are the real vehicles of power in Russia.

Influence groups act as a shadow power structure that intersects both horizontally and vertically with formal institutions. While managing their assets and vying with rival groups to acquire more, they use their influence over the machinery of the state to secure their wealth in the absence of sound legal guarantees for private property. The paramount leader, whether he occupies the position of president or prime minister, is to some extent “above the system,” but he can never disregard influence groups entirely and must take care to maintain a balance of power, preventing any single group from dominating.

In a fine example of the contrast between informal power and official titles, Russia’s current paramount leader is Prime Minister Putin, who technically serves at the pleasure of President Medvedev, his de facto subordinate. Putin moved from the presidency to the premiership in 2008, but retained his leadership role in practice. He acts as both arbiter and conspirator, resolving disputes and playing interests groups against one another to ensure that they do not threaten his power or the overarching enterprise. When he performs this task successfully, he keeps conflict beneath the carpet and enhances his formal powers with informal influence. When he stumbles, the spats come out into the light and mar the facade of order and stability.⁵

Russia’s clans are complex. Some are based on corporate solidarity, like that among KGB veterans. Others form around mutual business interests, as with Oleg Deripaska’s now ailing financial empire. Still others draw on experiential bonds, like the group of friends in St. Petersburg who summered together in the 1990s, formed the Ozero cooperative to unite their out-of-town residences, and went on to obtain immense wealth and power when one of their number, Putin, became president in 2000. Most groups are held together by more than one type of glue. Yet all have a vested interest in preventing any movement toward a more transparent, genuinely democratic, and law-based system, as such a transition would undercut their informal power, threaten their stranglehold on the economy, and perhaps even expose them to prosecution.

Decorative democracy, sometimes called managed democracy,⁶ is the political system of choice for ruling elites who grudgingly accept elections as a precondition for legitimacy but do everything in their power to control the outcome.⁷ The practice of decorative democracy amounts to a grab-bag of dirty tricks—legal devices prevent the formation of new political parties, state-controlled media relentlessly promote favored candidates and denigrate their opponents, election commissions ignore gross violations and punish minor ones, and duplicate candidates confuse voters. Recent Russian election cycles have augmented this already skewed system with additional formal hurdles: single-mandate districts have been eliminated, the threshold for party representation in parliament has been raised from 5 percent to 7 percent, and credible international observers have been excluded. Gubernatorial elections have been eliminated entirely. The goal of these measures is to reduce the necessary evil of elections to a predictable exercise that allows the ruling elite to devote the bulk of their time not to the good governance that would otherwise be the key to holding power, but rather to the more pressing pursuit of extracting the maximum material gain from selectively capitalist kleptocracy.⁸

Critics within established democracies charge that image has overpowered ideas in their practice of politics, but in Russia’s decorative democracy this phenomenon has reached an extreme. Ruling elites engaged primarily in thievery and battles over assets have little time or use for a meaningful exchange of ideas. Still, they suspect that ideas are necessary, particularly in a political system that provides for little real communication between rulers and ruled, and they retain a Soviet fondness for a unifying ideology. Officially encouraged attempts to create such an ideology abound in Russia, and their products are usually cobbled together from Soviet statism, ethnic Russian chauvinism, a discourse of national renewal, indiscriminate nostalgia, and anti-Western xenophobia that is generally packaged as anti-Americanism.

What distinguishes these efforts are their illiberal essence and basic artificiality. They are illiberal in that their conception of “national greatness” is not an aggregate expression of citizens’ social and economic well-being, but rather a metaphysical abstraction in which individual citizens dissolve into the faceless entity of “the people,” harnessed to a vast and ill-defined project of which the state is both the primary driver and the main beneficiary. The ideologies are artificial for the same reason that communist ideology had become moribund by the Brezhnev era—they do not bear any recognizable relation to the reality they purport to describe.

Efforts to fashion a “national idea” from the country’s imperial legacy tend to founder on the ineluctable fact that the empire is no more. Russian chauvinism meshes poorly with the multiethnic composition of a country that is home to millions of Muslims. Reverence for the accomplishments of both tsarism and Stalinism, coupled with a refusal to grapple with the failings of either, explains nothing about Russia’s historical trajectory over the past century. National renewal becomes indistinguishable from oil wealth. Taken together, these exertions hardly betoken the birth of a viable new ideology, let alone one with appeal beyond Russia’s borders, although the core concepts have been well received by a population that is understandably resentful over the depredations that followed the dissolution of the empire.⁹

Democracy is a small but important part of this conceptual concatenation. Vladislav Surkov, a top aide to Putin, famously appended the adjective “sovereign” to democracy in 2006, implying that while Russia is a democracy like other leading nations, it has the right to define the term as it pleases and deviate—by virtue of national sovereignty and tradition— from basic democratic standards and practices. The appendage proved an unhappy one, drawing ridicule from critics and even a barb from then first deputy premier Dmitry Medvedev shortly after its debut. Nevertheless, United Russia, the ruling party, foregrounds the term on its website, stating that “the renewal of the country on principles of sovereign democracy [means that] we are building a country with its own successful historical perspective.” In line with an increasingly bellicose attitude toward “Western” democracy, the party goes on to present a definition that stresses sovereignty over democracy: “For us, sovereign democracy is the right of the people to make its own choice relying on its own traditions and the law.”¹⁰

The Kremlin deploys the conceptual vocabulary of the new Russia—national renewal, nostalgia, anti-Western xenophobia, sovereign democracy—through a sophisticated domestic communications strategy that marshals both the traditional resources of the state and muchexpanded control over virtually all mainstream mass media.11 This one-two punch, coming amid a period of rising prosperity after a disastrous decade, has had a significant impact on popular opinion, and the Kremlin’s message has resonated with its intended recipients.

The traditional resources of the state include official pronouncements, the restoration of Soviet symbols, adjustments to school curriculums, the establishment of a ruling party, and the creation of youth movements. In 2005, Putin stressed in his “state of the nation” address to parliament that Russia “will decide for itself the pace, terms, and conditions of moving towards democracy”; he used the same speech to describe the collapse of the Soviet Union as the “greatest geopolitical catastrophe” of the 20th century. By that time, the familiar strains of the Soviet national anthem were sounding once again at official gatherings (with updated words penned by the author of the 1943 and 1977 versions). New history textbooks and manuals for teachers laud Joseph Stalin, gloss over the murderous legacy of Soviet communism, and represent the Putin era as a restoration of greatness that is imperiled by the evil designs of Russia’s enemies. United Russia has a lock on the rubber-stamp parliament and tentacles throughout the power structure. And a number of youth movements, funded directly or indirectly by the Kremlin, act as capillaries to bring new blood into the elite, cudgels to cow opponents, and bullhorns to blare approved messages. While the fate of this enterprise is now unclear in light of reduced oil prices and a global economic crisis to which Russia seems particularly vulnerable, it remains a signal accomplishment of the regime.

Mainstream mass media, from nationwide television stations to major newspapers, are now either under direct state control or owned by Kremlin-friendly business magnates. Violence against irksome reporters is routine, and a number of critical journalists, of whom Anna Politkovskaya is the best known abroad, have been murdered with seeming impunity in recent years. The official message resounds most clearly on television, where dissenting voices are blacklisted; newspapers enjoy somewhat more freedom, but with the balance clearly in favor of the Kremlin. Where the state does not have direct control, proxies like Gazprom-Media, which owns television networks, radio stations, and newspapers, perform a similar function, although they sometimes allow their holdings a longer leash, as Gazprom- Media does with radio station Ekho Moskvy.

The internet at first glance appears to contradict the rule, with independent voices readily available in some outlets, and even flourishing on blogs. Yet cyberspace is also the focus of increasing manipulation, with a vast array of Kremlin-funded websites promoting illiberal ideologies and regime-friendly forces stepping up their ownership of key infrastructure, like hosting sites for bloggers. And if web-based new media in functioning democracies have improved access to information and forced mainstream media to become more competitive, docile mainstream media in Russia simply ignore inconvenient online revelations and discussions, cutting off the cycle of feedback and response that has enlivened the press and enhanced accountability elsewhere.

The sophistication of the Kremlin’s domestic communications strategy derives from its recognition that total control is no longer possible, or even desirable, in a 21st-century media environment. The Soviet Union devoted immense energy and effort to cutting off alternative sources of information and spoon-feeding the population its carefully crafted, ideologically uniform propaganda. The Kremlin today focuses on the media that reach a majority of the public—not coincidentally, the same majority expected to vote as needed in the rote plebiscites that pass for elections. Message control, a “party line,” is considerably less important than reach and impact, with lively debates sometimes unfolding within the approved context of authoritarian restoration. Freedom flickers at the margins, with voices allowed to cry out as long as they do so in a wilderness bounded and policed by the powers that be.