Russia: Back to Putin’s crony capitalism

last updated 8 January 2015

Editorial

Vedomosti

With Vladimir Putin back in the presidential office, it’s party time for his pals, said Vedomosti. Friends and cronies, “be they oligarchs or state functionaries,” waited out the four years of the interregnum and now “expect their reward.” They needn’t wait another day. Already, Putin’s childhood friend and old judo buddy Arkady Rotenberg has been awarded a $1 billion construction contract. Putin has quietly canceled the privatization scheme that his placeholder in office, Dmitri Medvedev, announced in 2010. Last week Putin declared two major power grids, a hydroelectric giant, and the major oil company Rosneft to be strategic assets of the state, preventing them from being privatized and allowing the president to install his favorites as their heads. By doling out “pieces of the national pie” in this way, Putin ensures that he controls all industrial leaders. Anyone who “turns out to be so foolish as to resist and object can be easily jailed,” just like Yukos oil company founder Mikhail Khodorkovsky, now serving his 10th year in prison. Still, Putin may find it’s tougher to manage these men in his third term. After all, “unlike the appetites of the tycoons, the pie is not getting any larger.”