[Aaus-list] Streetwise Professor/Craig Pirrong: Pugachev’s Rebellion

Max Pyziur pyz at brama.com
Fri Oct 10 11:00:27 EDT 2014


Streetwise Professor/Craig Pirrong: Pugachev’s Rebellion
http://streetwiseprofessor.com/?p=8807

" ...

Indeed, it is just a recognition that Putin’s Russia is the continuation 
of a historical tradition stretching back to the dawn of Muscovy. As 
Richard Pipes wrote years ago, Russia/Muscovy was a patrimonial state in 
which all property was the tsar’s. Possession was temporary,  contingent 
on service, and conditional on the will of the tsar. Muscovy was the land 
of kormenlie-”the feeding”-in which the tsar granted a lucrative territory 
to an official, who was expected to support himself off of what he could 
take from it, and provide the tsar with service. Lands and serfs were 
granted to individuals in exchange for service, but were not property as 
such. Everything was occupied at the sufferance of the tsar. The system 
was later softened, and the service obligation weakened, but since forever 
the patrimonial aspects of the Russian state have survived. Putin is just 
the latest in a long tradition.

As I’ve written since the very beginning of the blog, Putin’s Russia is a 
“natural state” in which the ruler adopts policies that create rents, and 
then divvies up those rents in order to secure support,  to reward those 
who do his bidding and punish those who don’t: patrimonialism is one of 
the most primitive forms of the natural state. So the Timchenkos and 
Rotenbergs and Sechins live large, and the Yevtushenkovs and Khordokovskys 
and Pugachevs get crushed. Sometimes people are broken for a reason: 
sometimes the fall is arbitrary, just to demonstrate who is boss and to 
reinforce the understanding that wealth and power are contingent on the 
Putin’s will.

As I also wrote for a long time, especially around the time of the crisis 
in 2008-2009, the survival of this system depends on the existence of a 
stream of rents. When that stream dries up, it is more difficult to buy 
the subservience (I would not characterize it as loyalty) of the placemen. 
At such times, the system becomes vulnerable to collapse.

...

"

fyi,

MP
pyz at brama.com



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