VLAD’S OLIGARCHS PART 1: The Real Russian Elite

Under Putin’s leadership, the Russian Oligarchs have plundered their country and have participated or acquiesced in his crimes, including the greatest of them all, the invasion of Ukraine. They have echoed both Putin’s vicious propaganda against Ukraine and his denunciations of western decadence.

In describing Vladimir Putin and his inner circle, I have often thought of a remark by John Maynard Keynes about Georges Clemenceau, French prime minister during the first world war: that he was an utterly disillusioned individual who “had one illusion — France”.

Something similar could be said of Russia’s governing elite, and helps to explain the appallingly risky collective gamble they have taken by invading Ukraine. Ruthless, greedy, and cynical they may be — but they are not cynical about the idea of Russian greatness.

The western media employ the term “oligarch” to describe super-wealthy Russians in general, including those now wholly or largely resident in the west. The term gained traction in the 1990s and has long been seriously misused. In the time of President Boris Yeltsin, a small group of wealthy businessmen did indeed dominate the state, which they plundered in collaboration with senior officials. This group was, however, broken by Putin during his first years in power.

Three of the top seven “oligarchs” tried to defy Putin politically. Boris Berezovsky and Vladimir Gusinsky were driven abroad, and Mikhail Khodorkovsky was jailed and then exiled. The others, and their numerous lesser equivalents, were allowed to keep their businesses within Russia in return for unconditional public subservience to Putin. When Putin met (by video link) leading Russian businessmen after launching the invasion of Ukraine, there was no question of who was giving the orders.

The force that broke the oligarchs was the former KGB, reorganized in its various successor services. Putin himself, of course, came from the KGB, and a large majority of the top elite under Putin is from the KGB or associated state backgrounds (though not the armed forces).

This group has remained remarkably stable and homogenous under Putin and is (or used to be) close to him personally. Under his leadership, they have plundered their country (though, unlike the previous oligarchs, they have kept most of their wealth within Russia) and have participated or acquiesced in his crimes, including the greatest of them all, the invasion of Ukraine. They have echoed both Putin’s vicious propaganda against Ukraine and his denunciations of western decadence.

As Russia plunges deeper into a military quagmire and economic crisis, a central question is whether — if the war is not ended quickly by a peace settlement — Putin can be removed (or persuaded to step down) by the Russian elites themselves, in order to try to extricate Russia and themselves from the pit he has dug for them. To assess the chances of this requires an understanding of the nature of the contemporary Russian elites, and above all of Putin’s inner core.

By way of illustrating the depth of the Russian catastrophe of the 1990s and identifying with all those who suffered from it, Putin has said that at one stage he was reduced — while still a serving lieutenant colonel of the KGB — to moonlighting as a freelance taxi driver in order to supplement his income. This is plausible enough. In 1994, while I was working as a journalist for The Times in Russia and the former USSR, my driver in the North Caucasus was an ex-major in the KGB. “We thought we were the backbone of the Soviet Union,” he said to me bitterly. “Now look at us. Real Chekists!”

Despite amassing immense wealth and power, Putin and his inner circle remain intensely resentful of the way the USSR collapsed

“Real Chekist” (nastoyashchy chekist) was a Soviet propaganda phrase referring to the qualities of ruthless discipline, courage, ideological commitment, and honesty supposedly characteristic of the Cheka, the first Soviet secret police formed by Lenin and his associates. It became the subject of many Soviet jokes, but there is little doubt that Putin and his top elite continue to see themselves in this light, as the backbone of Russia — though Putin, who is anything but a revolutionary, appears to identify much more strongly with the security elites of imperial Russia.

An interesting illustration of this comes from Union of Salvation (Soyuz Spaseniya, 2019), a film about the radical Decembrist revolt of 1825, made with the support of the Russian state. To the considerable shock of older Russian friends of mine who were brought up to revere the Decembrists, the heroes of this film are Tsar Nicholas I and the loyal imperial generals and bureaucrats who fought to preserve government and order against the rebels.

Although they have amassed immense power and wealth, Putin and his immediate circle remain intensely resentful of the way in which the Soviet Union, Russia, and their own service collapsed in the 1990s — and great power mixed with great resentment is one of the most dangerous mixtures in both domestic and international politics.

As Putin’s autocratic tendencies have grown, real power (as opposed to wealth) within the system has come to depend more and more on continual personal access to the president; and the number of those with such access has narrowed — especially since the Covid pandemic led to Putin’s drastic physical isolation — to a handful of close associates.

Five of Putin’s inner circle
Sergei Lavrov, 71, foreign minister
Sergei Naryshkin, 67, foreign intelligence chief
Nikolai Patrushev, 70, secretary of Russia’s security council
Igor Sechin, 61, chief executive of Rosneft
Sergei Shoigu, 66, defense minister

In his first years in power, Putin (who was a relatively junior KGB officer) could be regarded as “first among equals” in a top elite of friends and colleagues. No longer. Increasingly, even the siloviki have been publicly reduced to servants of the autocrat — as was graphically illustrated by Putin’s humiliation of his foreign intelligence chief, Sergei Naryshkin, at the televised meeting of the National Security Council on the eve of war. Such contemptuous behavior towards his immediate followers could come back to bite Putin, as it has so many past autocrats.

The inner core includes defense minister Sergei Shoigu (former emergencies minister and not a professional soldier); Nikolai Patrushev, former head of domestic intelligence and now secretary of Russia’s National Security Council; Naryshkin; and Igor Sechin, the former deputy prime minister appointed by Putin to run the Rosneft oil company. Insofar as top economic officials with “patriotic liberal” leanings were ever part of this inner core, they have long since been excluded.

These men are known in Russia as the “siloviki” — “men of force”, or perhaps even, in the Irish phrase, “hard men”. A clear line should be drawn between the siloviki and the wider Russian elites — large and very disparate and disunited congeries of top businessmen, senior officials outside the inner circle, leading media figures, top generals, patriotic intellectuals, and the motley crew of local notables, placemen and fixers who make up the leadership of Putin’s United Russia party.

Among some of the wider Russian elites, unease at the invasion of Ukraine and its consequences is already apparent. Naturally enough, this has begun with the economic elites, given their deep stakes in business with the west and their understanding of the catastrophic impact of western sanctions on the Russian economy. Roman Abramovich, his discomfort clear enough as he sought buyers for Chelsea Football Club, found the sale halted this week when his UK assets were frozen. Mikhail Fridman, chairman of Alfa Group (already severely hit by western sanctions) and one of the surviving former “oligarchs” from the 1990s, has called for an early end to the war, as has aluminium magnate Oleg Deripaska.

If there is no peace agreement and the war drags on into a bloody stalemate, the economy declines precipitously and the Russian people see a steep fall in their living standards, then public unrest, state repression and state attempts to dragoon and exploit business will all inevitably increase radically, and so will the unhappiness of the wider elites.

These, however, lack the collective institutions and, perhaps more importantly, the collective identities that would allow them to combine easily to unseat Putin. The Duma, or lower house of Russia’s parliament, was succinctly described to me by a Russian friend as “a compost heap full of assorted rotten vegetables”. This is a bit too unkind — the Duma does contain some decent people — but it would be futile to look to it for any kind of political leadership.

The army, which elsewhere in the world would be the usual institution behind a coup, has been determinedly depoliticized, first by the Soviet state and now by Putin’s, in return for huge state funding. It is also now committed to military victory in Ukraine or at least something that can be presented as a victory.

On the other hand, Putin’s ruthless purging of the upper ranks of the military, along with the apparent incompetence with which the high command has steered the invasion of Ukraine, could lead to considerable future discontent in the army, including lower-rank generals. This means that while the military will not itself move against Putin, it is also very unlikely to move to save him.

Some of the most effective pressure on Putin’s elite may come from their own children. The parents almost all grew up and began their careers in the final years of the Soviet Union. Their children, however, have in many cases been educated and lived largely in the west. Many agree, at least in private, with Elizaveta Peskova, daughter of Putin’s press spokesman Dmitry Peskov, who protested against the war on Instagram (the post was quickly removed). Dinner conversations in the Peskov family must be interesting affairs these days.

The siloviki, however, are so closely identified with Putin and the war that a change in the Russian regime would have to involve the departure of most from power, possibly in return for a promise that they would not be arrested and would retain their family’s wealth (this was the guarantee that Putin made with his predecessor Yeltsin).

I think one reason [the siloviki] steal on such a scale is they see themselves as representatives of the state, and feel that to be poorer than a bunch of businessmen is a humiliation, even an insult to the state (A senior former Soviet official)

Yet this change may be a long time coming. The siloviki have been accurately portrayed as deeply corrupt — but their corruption has special features. Patriotism is their ideology and the self-justification for their immense wealth. I once chatted over a cup of tea with a senior former Soviet official who had kept in touch with his old friends in Putin’s elite. “You know,” he mused, “in Soviet days most of us were really quite happy with a dacha, a color TV, and access to special shops with some western goods, and holidays in Sochi. We were perfectly comfortable, and we only compared ourselves with the rest of the population, not with the western elites.

“Now today, of course, the siloviki like their western luxuries, but I don’t know if all this colossal wealth is making them happier or if money itself is the most important thing for them. I think one reason they steal on such a scale is that they see themselves as representatives of the state and they feel that to be any poorer than a bunch of businessmen would be a humiliation, even a sort of insult to the state. It used to be that official rank gave you top status. Now you have to have huge amounts of money too. That is what the 1990s did to Russian society.”

The siloviki are naturally attached to the idea of public order, an order that guarantees their own power and property, but which they also believe is essential to prevent Russia falling back into the chaos of the 1990s and the Russian revolution and civil war. The disaster of the 1990s, in their view, embraced not just a catastrophic decline of the state and economy but socially destructive moral anarchy — and their reaction has been not unlike that of conservative American society to the 1960s or conservative German society to the 1920s.

In this, Putin and the siloviki have the sympathy of very large parts of the Russian population, who remain bitterly resentful — both at the way they were betrayed and plundered in the 1990s and what they perceive as the open contempt shown towards ordinary Russians by the liberal cultural elites of Moscow and St Petersburg.

On one memorable occasion in the mid-1990s, I was asked to give an after-dinner talk at a conference held by a leading western bank for western investors and Russia’s financial elite. The dinner took place at a famous Moscow nightclub. When I ran out of time, there was no question of a polite note from the chairman; instead, a jazzed-up version of a Soviet patriotic song started blaring, and behind me on the stage appeared someone in a bear costume waving the Russian military ensign and leading a line of dancers clad in very abbreviated versions of Russian national dress.

The siloviki and the Russian official elite, in general, are utterly, irrevocably committed to the idea of Russia as a great power

Faced with this competition, I didn’t even try to carry on with my carefully considered summing-up, but retired bemused to my table. Then, however, I began to get a distinctly cold feeling. I remembered a scene from the 1972 film Cabaret, set in a nightclub in Weimar Berlin not long before the Nazis’ rise to power, in which dancers perform a parody of a parade before a giggling audience to the tune of a famous German military march. I wondered whether in Russia, too, there was going to be a terrible bill to pay for all this jollity — and I fear that Ukraine, and Russian soldiers, are now paying it.

One of the worst effects of this war is going to be deep and long-lasting Russian isolation from the west. I believe, however, that Putin and the siloviki (though not many in the wider elites) welcome this isolation. They are becoming impressed with the Chinese model: a tremendously dynamic economy, a disciplined society, and a growing military superpower ruled over with iron control by a hereditary elite that combines huge wealth with deep patriotism, promoting the idea of China as a separate and superior civilization.

They may well want the west to push Russia into the arms of China, despite the risk that this will turn Russia into a dependency of Beijing. And of course they believe the war in Ukraine will consolidate patriotic feeling in Russia behind their rule, as well as permitting them to engage in intensified repression in the name of support for the war effort. This repression has already begun, with the closing of Russia’s last remaining independent media and laws punishing as treason any criticism of the war.

Above all, for deep historical, cultural, professional and personal reasons, the siloviki and the Russian official elite in general are utterly, irrevocably committed to the idea of Russia as a great power and one pole of a multipolar world. If you do not believe in that, you are not part of the Russian establishment, just as if you do not believe in US global primacy you are not part of the US foreign and security establishment.

Ukraine’s place in this doctrine was accurately summed up by former US national security adviser Zbigniew Brzezinski: “Without Ukraine, Russia ceases to be a Eurasian empire.” The Russian establishment entirely agrees. They have also agreed, for the past 15 years at least, that America’s intention is to reduce Russia to a subservient third-rate power. More recently, they have concluded that France and Germany will never oppose the US. “To the west, we have only enemies,” as one establishment intellectual told me in 2019.

The Russian establishment sees encouragement of Ukrainian nationalism as a key element in Washington’s anti-Russian strategy. Even otherwise calm and reasonable members of the Russian establishment have snarled with fury when I have dared to suggest in conversation that it might be better for Russia itself to let Ukraine go. They seem prepared, if necessary, to fight on ruthlessly for a long time, and at immense cost and risk to their regime, to prevent that happening.

Anatol Lieven is a senior fellow of the Quincy Institute for Responsible Statecraft and author of ‘Ukraine and Russia: A Fraternal Rivalry’