From Oligarchy to Oligarchy: The Structure of Russia's Ruling Elite

Author's Note: This article is a revised and expanded version of a lecture delivered at the Kennan Institute, Washington, D.C., 14 December 1998. It was updated to include events through the first week of February 1999. Because of the rapid unfolding of the power struggle between President Yeltsin and Prime Minister Primakov at the time this article was submitted for publication, I decided that it was fruitless to try to update the text. Any text was likely to be out of date in some specifics by the time it appeared; for example, either Primakov or Yeltsin might no longer be in office. Nevertheless, I am confident that the outcome of the struggle will not change the basic argument about the structure of the Russian oligarchy, including the point that the relations among oligarchic groups will remain in flux until power is transferred to Yeltsin's successor. As has been true for centuries, Russia today is ruled by a small oligarchy.(1) This statement does not mean that Russia is dominated by that narrow group of well-connected businessmen often referred to as "the oligarchs" in both Russian and Western media. Those men, particularly media moguls Boris Berezovsky and Vladimir Gusinsky, have done much to promote their own reputation for power and influence, largely through the media they control. In fact, their power has been much exaggerated, and the focus on them has diverted attention from the true composition and structure of Russia's oligarchy. It has even led some keen observers to doubt its existence.(2) But if "oligarchy" is understood in the classical sense as the rule by a small propertied class in their own parochial interests, then Russia is most definitely ruled by one.(3) The primary oligarchic structures are large political/economic coalitions built around control of key government positions, significant financial and industrial assets, mass media outlets and information-gathering agencies, and instruments of coercion (both state and private). Such structures dominate the political and economic landscape at the national and regional levels. Their rise and fall and the interaction among them drive politics. More than formal institutions such as the government and parliament, these coalitions set the political and economic agenda, limit the range of policy choices, and make the fundamental decisions even if the decisions themselves are presented as the outcome of deliberations and operations of the formal institutions. Contrary to prevailing opinion, the financial meltdown of August 1998 and the ensuing economic and political turmoil have not marked the demise of the oligarchy, although they continue to have far-reaching consequences for the fate of specific individuals, some of whom will lose power, never to regain it. Rather, the turmoil has broken the coalitions down into their constituent parts and created conditions for their restructuring and reordering, as well as for the emergence of entirely new coalitions. The fundamental condition that has historically given rise to and sustained the oligarchy--the close intertwining of power and property--remains unchanged. A brief review of recent Soviet/Russian history suggests that the nature of power is key in determining the structure and behavior of the oligarchy. The more unified power, the more structured and disciplined the oligarchy. The erosion and diffusion of power sharpen the competition among rival oligarchic groups, without necessarily broadening significantly the social stratum that engages in the struggle for power and property. The weakening of power also raises the risk that the competition among oligarchic groups will spin out of control and jeopardize regime stability. The Soviet Oligarchy After the death of Stalin, a classic oligarchy, or collective leadership as the Soviet leaders called it, emerged in the Soviet Union, structured in a rigid hierarchy around the leading organs of the Communist Party of the Soviet Union (CPSU). …