Speach on the VII International Conference on Europian secutity, Prague, November 2011

2011.11.14 , РТПУНПФТПЧ 752

Dear collegues,

That’s big honor and great pleasure for me – to be here and have possibility to speak with you about my country.

But I’m afraid, that official theme of my speech will joke, - may be, too expensive for Russia.

Unfortunely, now modernization in Russia is only word, not real policy. Lately this term discredited itself in Russia. During the Medvedev’s presidency it became the new swear word.

As you, may be, know, before the start of his presidency Medvedev has solemnly proclaimed four "I": institutions, infrastructure, innovations and investitions. Then he has added to them the fifth "I" - intelligence. Now we can see, that these words have not been supported by real work. All kinds of institutes were consistently destroyed, the infrastructure developed insufficiently, innovations remained basically propaganda and including silly, in my opinion, ideas such as the time reform and badminton playing. Investments weren't restored after crisis, more than – near 95% of foreign investments are loans, including short-term loans. As to intelligence, brain drain has increased to their escape already, and Medvedev has declared that he doesn't see in it a problem.

Of course, there are successes too, we have many local improvements from our oildollars, including import of new consumption goods and technologies.

But, in the general opinion, there is only one real example of big modernization: that’s technopolis “Skolkovo”.

But what is Skolkovo?

There are many sciencecities in Russia. These sciencecities were founded in Soviet Union, but they continue to work, - better or worse, but continue. And it was simply and logically – to begin the modernization on their basis.

But president Medvedev took other way. Skolkovo was founded from zero – of course, not “Grand Zero”, as in New-York – but from big zero in 5 kilometers from Moscow.

Residents of Skolkovo have great privileges; first of all, they are out of the Russian jurisdiction, in medias res. The Russian laws and even Russian language don't operate in Skolkovo. There will a special court, the special police.

Thus resident Skolkovo shouldn't be in its territory physically. Its office and manufactures can be anywhere in Russia. In medias res, it not a territorial zone of development, but the mechanism of distribution of taxes and legal privileges. It is analog of an offshore zone Ingushetia, founded at 1994, at the start of first chechenian war. That’s interest for my, what kind of war have we now?

And such businessmen compromised with various doubtful operations as Russian oligarch Vekselberg and American insider Gupta, enter into a top-management of the Skolkovo project, possibly, not casually.

In modern Russia the archaic corruption mechanism even more strongly, than the Soviet centralized planning tears away technologies.

In this situation new technologies aren't developed and, the more, aren't applied.

Global and Russian corporates, including Boeing, register in Skolkovo in order to receive privileges its divisions which work in Russia already. Of course, there are new businesses, but that’s not mainstream. Only insignificant number of the foreign companies can come into Russia special for Skolkovo.

But it doesn't mean that the project "Skolkovo" is unsuccessful. On the contrary, it is the magnificent project, – of course, if we’ll understand its purpose correctly.

First of all, that’s the Medvedev’s propaganda project. Pay attention: we seriously discuss it, - and it is quite enough for promotion.

Secondly, that’s moveless project in the real estate field: outskirts of potato field on megapolis suburb rise in price extremely. And, of course, informed people bought up these earths in advance.

Thirdly, that’s fine-tuning of private state as a model of new type of state and society – after old welfare state. All completeness of the power in Skolkovo belongs to Council of investors, and even the Russian state has access to the power in Skolkovo not as the state, but only as one of large investors. Formation of the private state is one of important trends of world development. Russia can become real world leader of this process. But, unfortunately, that’s not modernization, - on the contrary, that’s movement in the past, in Dark centuries of the Middle Ages.

So, we can see: there is no modernization in modern Russia at all!

And why?

If we want to understand Russia's prospects, we have to understand its internal order.

We used to think that the state exists first of all for the public good. Of course, there are possibilities of theft and others vices in pursuing the public good, but we believe, that the public interest is most important for statesmen and for all state.

If we’ll think so about modern Russia, we’ll have grievous surprise. In that case we’ll have to repeat after our intellectuals their theses about twenty-five years of almost continuous errors.

That’s general tradition, and that’s great mistake.

пur intellectuals combine – and very happily combine amazingly long political life with amazingly short historical memory.

After all, an error which proceeds throughout quarter of the century – during life of the whole generation, during four - and very different! - presidencies - is in no case even a policy.

That’s strategy, that’s result of basic joint of interests.

In my humble opinion, we have got used to define motivation of our state incorrectly. Its real motivation is personal enrichment at any cost.

At opposed to the usual state the key part of our statesmen doesn't trust in any public interest. They believe sincerely, that the sole purpose of the state is their enrichment, and the common good – and democracy too - is “hostile Hollywood propagation”.

This belief does corruption by an irremediable basis of a state and all political system of modern Russia. It is possible to struggle with corruptionists - and this struggle is conducted - but not with corruption. As a matter of fact, struggle with corruptionists is conducted basically for redistribution of corruption financial streams.

In the past historians hadn't time to describe, and often to notice the like states. These states died too fast for historians. Our state exists so long because of a unique expensive oil and unique patience of Russians. All our presidents - from Gorbachev to Medvedev and Putin again – had and have more reasons to drink for our patience, than even Stalin.

Corruption as a basis of a political system doesn't give possibility to correct defects of existing social and economical system.

First of all, this defect is vulnerability of the property, - ill property - because this property can become loot of corruptors or based on corruption already.

Secondly, that’s total abuse of monopolies because monopolies have more money for bribes if they abuse its position freely.

Thirdly, our corruptors take out stolen in the developed, first of all luxurious countries and therefore can’t conflict with them. Russia can not create many new plants, because this plants will take away part of profit and jobsites from corporations of the developed countries and China too. So, our corruptors work for the interest of the developed countries and global market against Russian economy – and, so, Russian state work against Russian people.

Corruptors don’t need modernization, and corruption kill its possibilities.

The important result of total corruption is reduction of a living standard and growth of gap between rich and poor. On official researches, annual growth of economy in five and a half percent is minimum for maintenance of social and political stability. Otherwise money will not suffice for all significant groups of influence.

This growth is unachievable for our economy for said reasons, and we see decrease of the population’s incomes and growth of number of people with income less subsistence minimum - in spite of exclusively expensive oil and other row. Among all groups of influence the population has least real rights, and consequently it falls a victim of unsatisfied appetites of other groups at first.

Liberal reforms destroy social sphere of Russia not casually. That’s necessary for competitiveness maintenance to reduce national costs. It is impossible to lower corruption costs, because it is the income and a basis of prosperity of ruling class. There is only a social sphere for reduction, but destruction of education, public health services and culture makes modernization impossible even in the theory.

In this situation the modernization was Medvedev’s way to mark his difference from Putin – and anything else from the very first days. Not without reason now, when Medvedev discredited itself, there is official talking about stabilization again, but not only about modernization.

While oil remains expensive, Russia will be a desired commodity market for the whole world. However during preservation of present game rules reconstruction of Russia as developed country and transformation into the world economic center is impossible.

And this situation is great gift for Europa, first of all for old, developed Europa, for China and other Asian countries – from Turkey to Japan including even Bangladesh. They take their profit on our market. After that, while we don’t pay for modernization, USA and Europe have our money in their bonds and financial systems.

Despite all told, I believe that the future of Russia is state normalization and its reorientation from interests of the global markets to needs of the people, from corruption to development, from utilization of the Soviet heritage to modernization.

There is only one way for this change: crisis of this political system, but it can be different.

Good for us scenario of this crisis is possible for us still, though chances are small.

In my opinion, Putin’s comeback to power is caused by fear, instead of profit thirst. After Egypt and especially after Libia he has seen: henceforth there is not international low, and in the situation of global safari on old authoritarian leaders he can only one way to keep life – it’s to keep the power. That’s not too good, but not corruption modus operandi.

After that Putin can make the following step: to understand that it is impossible - to keep the power in same Libya and Egypt. In this case he must not admit transformation of Russia into Libya or Egypt. And it means real modernization.

It’s very difficult and very dangerous step, because Russian modernization will contradict commercial interests of the developed countries and China as sharpen a competition in the world. That will not only international, but also internal tension and, may be, even conflict, because modern ruling class of Russia hold in developed countries its actives – from money to children. In this situation the tension with developed countries is strong conflict with ruling class, first of all with notorious Putin’s friends.

That’s war, at least political war.

For start it Putin must lean only on the people against corruption and bureaucracy, begin real democratic revolution. It not only serious cataclysm; for him it’s self-denial, full change personal valuable and living style.

Why I sit here and speak about this way?

Why I think, that The probability of this way though is small, but is different from zero?

First of all, because Putin see the fate of Gaddafi, Mubarek, Miloshevich and so on and wants for himself another.

And, secondly, Putin tells about necessity the reindustrialization of Russia. I know it’s not good idea - to listen slogans before election, but that’s other case, because this slogan the first was put forward by Khodorkovsky when he was the prisoner already.

If Putin and Khodorkovsky speak same, it is objective necessity. And it means that Putin doesn't have other words, because he will prefer to do everything, but not to repeat after Khodorkovsky.

It means that there is a possibility of modernization, and system crisis may be localized only in the political field.

Certainly, most likely, Putin won't dare to tell to ruling class "I gave birth to you at last decade and now I need kill you in the next year".

Most likely, he will prefer not to the conflict to his environment and to the West, and to continue the corruption inertia and rotting.

It means that he’ll push off Russia in not only political, but complex system crisis. And in this case next leaders will go by modernization way without him and against him already.

But these leaders will less European than Putin, because system crisis is very dangerous and sharp situation.

Thank you so much for attention.

And, at a last – I think, not sure, but think, - that I understand Russian future at next 5-6 years. But, sorry, I don’t understand European future – and I’m afraid, that you don’t too. Where is Europe going in through this crisis?

And why we speak about clear Russian themes, about crisis of our past and keep silence about really non-knowing perspectives of Europe, about crisis of our future?