Publication: Prism Volume: 3 Issue: 5

Russia’s gangsters have succeeded in blurring distinctions between right and wrong, law and crime

By David Satter

This is an expanded version of an article which previously appeared in the Wall Street Journal. Reprinted with permission of the WSJ.

Copyright © 1997 Dow Jones&Company, Inc. All rights reserved.

As organized crime tightens its grip in Russia, the world’s second nuclear power is in danger of losing the most important achievement of the peaceful revolution which overthrew the Soviet Union, a sense of social morality.

When the Soviet Union fell, the deification of the state fell with it opening up the possibility of a new future for Russia and the other successor republics. For this new departure to take place, however, the moral impulse which motivated the democratic movement and was embodied in the activities of the late Academician Andrei Sakharov had to become the basis of Russia’s political practices.

The tragedy of the present situation is that Russian gangsters are cutting off this development before it has a chance to take root.

Russia’s gangsters are not content simply to wield power. Like the former Communist rulers, they also seek to muddle all normal moral criteria. If the Communists used ideology to deny the existence of absolute morality, in that way, depriving Soviet citizens of ethical autonomy, the criminals render Russians helpless by using their increasing control over all aspects of Russian society to destroy any understanding of the meaning of legality.

In fact, the psychological niche once occupied by the Communist authorities in Russian society is now being taken by criminals.

It is virtually impossible in today’s Russia to distinguish legal from criminal business. At the same time, criminals, in many respects, have replaced the judicial system, collecting debts, settling disputes and enforcing contracts, and they are becoming the heroes of the new, popular culture, which, in the absence of Communist era censorship, is held to be "democratic."

The intertwining of legal and criminal business is the most important fact of the new economic system. Nearly every private business in Russia is forced to pay protection money to racketeers and criminal money is reinvested in non-criminal businesses in which criminals then become partners. The criminals’ disregard for human life assures ready "cooperation" from businessmen who take representatives of the criminal world into their firms, particularly into the accounting department, and accept a split of the profits on the gangsters’ terms.

The sheer size of criminal holdings and the need to legalize them then lead the racketeers to establish their own businesses, for example, in such spheres as the export of oil and non-ferrous metals and the import of food products and to create banks, able to launder criminal capital through official credit operations. According to the Ministry of Internal Affairs, criminal gangs in Russia now have 1,500 of their own commercial structures but control 40,000 economic entities, including 500 banks. This amounts to the criminalization in Russia of all stages of the production process and the entire web of economic relations.

Besides the confounding of legal and criminal business, Russia has witnessed the emergence of criminals as a substitute for law and the judiciary.

In the present juridical chaos, it is common for businessmen to receive bank credits and then refuse to repay them or to accept payments without delivering the purchased goods. Civil conflicts in Russia should be resolved in the arbitration court but the court system is understaffed and inefficient and it can take more than six months to get a hearing on simple matters and another three to four months to attempt to execute a decision once it is made.

Even if the court finds in a plaintiff’s favor, however, he rarely receives satisfaction. In order to avoid taxes, many Russian businessmen have created networks of fictitious firms, which can be declared bankrupt in the event of an attempt to collect a debt. Money is easily transferred abroad and under the law, it is impossible to seize a debtor’s apartment but only his car or dacha, both of which have usually already been sold.

In this situation, both Russian businessmen and ordinary citizens are turning to racketeers to enforce their contracts. Many of Russia’s gangs now employ lawyers and economists who, in a parody of a civil justice system, demand copies of documents to confirm the existence of a legal debt. Once the debt is confirmed, enforcers threaten the debtor’s life and sometimes that of his wife and children if it is not repaid. Under these circumstances, the debtor usually finds the money, often by borrowing from relatives and friends, and the racketeers receive 50 per cent of the take.

These methods have become so popular in Russia that racketeers are now called in over even minor disputes, for example, after an auto accident on the highway, further increasing their role as the arbiters of society.

Besides helping to enmesh legal and criminal business and assuming law enforcement functions, Russian racketeers have emerged in some quarters as popular heroes. To a degree never before possible in Russia, criminal gangs have become the patrons of sporting and charitable organizations. In fact, in the last few years, they have become the chief sponsors of Russian sport. Otar Kvantirishvili, the "godfather" of the Moscow mafia who was killed in April, 1994 by a sniper while surrounded by bodyguards, founded the Yashin Fund for the Social Defense of Sportsmen and several boxing and wrestling associations. Money extorted from businesses under his control was used to finance children’s sports academies.

Scores of books on sale in Moscow and St. Petersburg kiosks are about gangsters and criminals who have become the heroes of popular films. Russian cabaret singers, for the first time, sing "blatnoi" (criminal) songs on television and well known entertainers perform at the parties of prominent gangsters. Jargon from the Russian thieves’ world has found its way into public expression. Such terms as "bez pridel" (without limits,) used to describe an out of control labor camp, and "v zhizhni" (in life,) used to describe an individual’s prison occupation, are now employed by talk show hosts to describe the normal condition of society furthering the impression that thieves are taking over the country.

At the same time, racketeers are not indifferent to their public standing. Occasionally, they will sponsor concerts or athletic events or ostentatiously recover a factory worker’s stolen car as a "public service." A letter published in the St. Petersburg newspaper, "Smena," expressed admiration for bandits as persons who "can really help" and "have sober minds" and asked whether they could assist the writer in seeing her granddaughter whom her daughter was hiding from her.

The cumulative effect of these developments has been to upset the balance between crime and punishment in Russia and to undermine the already extremely shaky concept of legitimacy in the country. Russians do not know whose authority is lawful and criminals, convinced of their impunity, behave as if they already constitute a new, ruling class.

The loss of a sense of legitimacy in Russia is a serious matter for the West because, without reliable bearings, honest, civil society in Russia can lose its ability to resurrect itself, in which case, the final victory of an oligarchical criminal regime is inevitable. And, in a game with no rules, such a regime could begin openly to flout the West’s conception of civilized values.

Russian organized crime in involved in the sale of narcotics but criminal groups are also involved in the theft of nuclear technology and of such materials as enriched uranium and plutonium.

During the last five years, Russia’s democratic institutions have been deformed under the impact of organized crime and corruption and the leaders’ lack of respect for democratic practices. This process can only be reversed by the establishment in the country of the rule of law, capable of giving democratic institutions a moral foundation even as it offers indispensable physical protection to the average Russian citizen.

This, in turn, points to a new role for the U.S., which is urgently needed with the swearing in of a new secretary of state.

Forceful American support not for a particular political figure but for the decriminalization of Russian government and society can give vital support to those Russians who are fighting to establish the rule of law. For the moment, they are a disparate group – members of parliament, organizers of free trade unions, even officers of the Ministry of Internal Affairs – but with a reservoir of potential support in the population, they are the best hope for Russia’s future.

Unfortunately, U.S. policy, instead of defending democratic values, has supported Yeltsin as the "embodiment" of democracy convincing many Russians that the U.S. either is unaware of the criminal situation in the country or is as morally blind as the Russian leaders.

Pipedreams about the normalization of criminal capital notwithstanding, Russia’s gangsters are not good candidates to lead an economic recovery. The ultimate consequences for Russia of the failure to establish a reliable principle of legitimate authority can only be social unrest and political turmoil, creating the risk of ethnic conflicts, nuclear tensions and terrorism, as Russia’s failure to solve its moral problem bequeathes to the world the nihilism of the twentieth century at the very moment when we are looking ahead to the twenty first.

Mr. Satter is a senior fellow at the Jamestown Foundation and a visiting scholar at the Johns Hopkins University School of Advanced International Studies. He is the author of Age of Delirium: The Decline and Fall of the Soviet Union (Knopf.)