Can Russia Modernize? A sociologist’s perspective

In her 2013 book Can Russia Modernise? Alena Ledeneva picked out key types of networks that make up sistema:  Russia’s complex, ambiguous and sometimes surprisingly effective system of informal governance. In the first part of a three-part ‘mini-symposium’,  Katharina Bluhm assesses the book and its arguments from a sociologist‘s perspective.

Alena Ledeneva is the author of several books all of which centre on informal economic and governance practices in Russia. Her three monographs Russia’s Economy of Favours (1998), How Russia Really Works (2006), and Can Russia Modernise? (2013), can be read as a trilogy. In Russia’s Economy of Favours the centre of attention was the everyday exchange systems of normal people, while in How Russia Really Works Ledeneva’s focus shifts towards business and the asset stripping that takes place through complex inter-firm relationships. Her newest book explores Russia’s power networks and systems of informal governance or sistema.

The 2006 and 2013 books share one particularly important question: Can Russia modernize? In How Russia Really Works Ledeneva asks how Russia’s unwritten rules can be changed, or whether in fact they can. Her answer is laced with scepticism. She points to the fact that over the past decade, actors have fought bitterly over the rules of the game: for example the support for shock-therapy of Western aid programmes and advisers aimed at the rapid installation of a new market economy, or the foreign investors who have tried to introduce Western business practices being studied in Russian business schools today. Small entrepreneurs have called for more transparency in the way business is done.

Russia is now a member of the World Trade Organisation, and Putin once called for a ‘dictatorship of law’ and – at least according to some observers – Medvedev really was interested in changing the rules of the game, but just did not get very far in his efforts. Ledeneva concludes that in order to overcome the informal rules it is ‘simply not enough to transform the formal rules and the way they are enforced.

 She did not previously seem very optimistic about what had to be done speaking of

 a massive cultural shift within the population (and related patterns in everyday life); the emergence of a new social base, constructed around interest groups that could break free from the current system and a political will through which the institutions of power (the state and the bureaucracy) are compelled to conduct policies that are designed to clean themselves and increase accountability.

  Springing the ‘modernisation trap’

Unwritten rules work as a kind of shock-absorber and bridge the gap between the formal codes and law enforcement; they serve as solutions to problems posed within the formal framework and compensate for the deficiencies of Russia’s political culture and legal system. So, as in the times of the planned economy, informal rules, exchange and networks serve a systemic but different function.  The role and character of informal practises have drastically changed, and so have the options for cutting back their influence.

In 2006, Ledeneva suggested taking multiple approaches to achieve this: reducing extra-legal practices by formalisation; establishing channels of bottom-up-feedback on these formal rules and their enforcement (system learning loops); encouragement of public debate on patronage; financing of opinion polls; research, education, literature and TV programmes – in short reflection upon and stigmatization of corruption. She also suggested enhancing the professionalism of social actors and good management at every level, as well the modernizing of social networks (that is, the creation of different types of networks) by the creation of civic society initiatives, new professional networks, and outside influence.

 Seven years later, Ledeneva seems even more pessimistic. Although the latest book ends with Ulrich Beck’s notion of a ‘reflexive Modernity’, the catalogue of change is shorter now, and her study of Russian power networks concludes with the diagnosis that there is a ‘modernization trap; from which there seems to be no escape. In an interview Ledeneva gave to Radio Free Europe, this was illustrated quite nicely. She told RFE

 … Putin always steps in and personally makes sure there is a Sochi Olympic village that is built on time. If he needs to get something, he puts his best friend in charge. He always makes sure he uses reliable people in different positions. And that is a kind of — [as] I call it in the book – ‘modernization trap’. Because you do use informal networks to get things done and you think you are pursuing the targets of modernization through the use of the tools which seem to you, as a leader, effective. But you cannot escape the long-term consequences. Those informal-governance instruments actually come back and hit you by undermining the workings of formal institutions, which remain weak [and] unoperational. And you then suck yourself into the whirl of informality that is very much personalized and cannot be used in a controlled way.

 In the same interview, as well as in the book, she also quotes Gorbachev: ‘you cannot change sistema at all.’

 If Ledeneva has become more sceptical about the modernization of Russia since 2006, is this increased scepticism warranted? What we see in Russia seems to be reason enough for scepticism; yet, modernization is a very normative approach and is often criticised for using an idealised Western model of the separation of state and economy, with a rational bureaucracy and rule of law. What Putin has apparently attempted to do is to combine a rather authoritarian approach with technical and economic modernization: the China path so to speak – which has gained a lot support in the non-Western world since the 1990s because it seems to work without the complete implementation of Western modernity, especially as the Russian government is governing or trying to govern an imperial structure, not a classic Western nation state. According Ledeneva’s diagnosis, Putin must fail in this goal because of the specific character of the power networks. But what makes them different to the Chinese networks? Is China a stronger state? Are Chinese networks, so to speak, more modernized?

 Sistema and networks

Sistema is not simply a synonym for network. In the interview mentioned, Ledeneva, explains why she highlights the term sistema: because it was the third most-used word in Russia from a content analysis of elite interviews. With regard to sistema, she refers to Putin’s answer to a question put to him at the Valdai Discussion Club about his plan to fight corruption in the Kremlin. He said, ‘You know, it is no good to punish people individually. You need a whole change of sistema in order to get rid of corruption.’

 But it does seem that Putin does not mean the same by the term as Ledeneva does. It would be interesting to understand what Putin meant with sistema and is a pity that nowhere in her book does Ledeneva try. Yet Ledenenva’s own definition of sistema is also hard to pinpoint, which, she would answer, is certainly part of the story. On the one hand, sistema is defined as:

 a complex, anonymous, unpredictable and seemingly irrational … [system]… but it serves to glue society together, to distribute resources and to mobilize people. Prioritize short-term profits over long-term sustainability, loyalty at the expense of professionalism.

 On the other hand she speaks of Putin’s sistema (in contrast to Yeltsin’s), which puts Putin in a kind of leading role in a personalized ego-centred network. In other words: sometimes it looks highly personalised and structured in different circles around a kind of core. One can exit the sistema or be expelled. Is it then a kind of superstructure composed of all the sets of power networks in Russian politics and economics? But how could it be anonymous and personalized at the same time? Does the sistema’s limitation lay in its complex, anonymous, unpredictable and seemingly irrational character? Or does it lie in the restrictions of supervising a complex political system and a huge country via personal networks? This is a fundamental difference in understanding.

 One of the most striking passages in Ledeneva’s book is the notion that the usual anti-corruption measures based on Max Weber’s theory of rational bureaucracy, such as raising the salaries of bureaucrats, administrators, teachers and professors, would not help. This is because people are now used to extraordinary incomes allowing them to enjoy a lifestyle beyond that of a normal person. This argument may have held true for the new Russian upper ‘Service Class’ but, can this also be said generally for all bureaucrats, administrators, teachers and professors? Here, as in other cases, the boundaries between what Ledeneva calls power networks and everyday corruption are too blurred. There is a kind of omnipresence of sistema that seems to hinder the precise analysis of governance, sectors and the workings of barter-exchange networks.

 Sector analysis, regional analysis, or an analysis of different institutional spheres might also be helpful here. It would also useful to separate an individual’s interests which generate personal income in networks from their interests in acting as representatives of a corporation, administration etc. in order to get things done. And here may lie a glimmer of hope: that in Ledeneva’s analysis of Russia’s power networks a lot of people do seem to want get to things done – and not only for their own private benefit.

Katharina Bluhm is Professor of Sociology at the Institute for East European Studies at the Free University of Berlin.

The cover image is reproduced by kind permission of Cambridge University Press.

Note: This article gives the views of the author(s), and not the position of the SSEES Research blog, nor of the School of Slavonic and East European Studies, nor of UCL