When Philip Marlowe, the famous fictional American private eye, read the gossip columns of big-city newspapers, he explained that “I don’t read them often, only when I run out of things I dislike.” If Marlowe were able to read the Moscow papers and savor their meretriciousness, he’d never make it off the front page.
Take last week’s big news story, for example: That there is an opposition movement afoot inside Moscow that is proposing to redistribute economic power in Russia and change the elites that pull the levers. At the start of campaigning for national parliamentary elections in three months’ time, to be followed by the presidential election next March, a little cheap socialism shouldn’t surprise anyone. What really would be a scoop is if there is no opposition in Russia seeking votes on such a platform.
If you study the novels of Raymond Chandler, Marlowe’s creator, you will realize that Marlowe was a cheap socialist himself, overwhelmed by an undisguised disgust for his countrymen. Among the great American writers, that makes him unique. None of them were as pessimistic and inconsolable as the Chicago-born, European-educated Chandler, who acquired much of his economics from the oil business and put most of his politics into the mouths of policemen. “A guy can’t stay honest if he wants to,” says one to Marlowe. “That’s what’s the matter with this country. He gets chiseled out of his pants if he does.” According to another, “I’d like to see the flashy well-dressed mugs spoiling their manicures in the rock quarry at Folsom [Prison], alongside of the poor little slum-bred hard guys that got knocked over on their first caper. That’s what I’d like. But you and me both lived too long to think I’m likely to see it happen. Not in this town, not in any town, not in any part of this wide, green and beautiful USA. We just don’t run our country that way.”
Gleb Pavlovsky is a man who fancies long sentences, promotes himself as an influential media advisor to the Kremlin and, for a hefty price, will tell you how to run Russia. If he were anything less, it wouldn’t be news that there are people moving around inside the very walls of the Kremlin who share Marlowe’s cheap sentiments and would rather not pay Pavlovsky for his more expensive ones. Last week, to spite them, Pavlovsky composed what he called a report to the president’s chief of staff, Alexander Voloshin, and dispatched it to as many newspapers as he could think of. He gave it a rich, 16 word title: “On the negative consequences of the summer assault by the minority opposed to the president’s agenda.”
Now, thousands of middle-aged men with washbowl haircuts and brains about Pavlovsky’s size write the Kremlin every week, breaking news of nasty plots their cerebral antennae have detected in the cosmos. The difference between them and Pavlovsky, according to his newspaper pals, is not that Pavlovsky’s report was addressed to Voloshin, but that Voloshin asked for it. Voloshin sees a lot of unwanted paper every day, but if he asked for Pavlovsky’s, he isn’t saying. He won’t say either if he paid Paviovsky’s invoice.
According to the report, there is a conspiracy of anti-state plotters led by ex-KGB officers currently on the staff of President Vladimir Putin. They have hatched the idea of increasing Russia’s tax revenues from the oil and mining industries. Those who resist the conspirators, according to Pavlovsky, will be indicted for all the crimes they committed to get to where they are today.
Although ordinary folk don’t need help to conclude that the tax resisters would be getting their just desserts, Pavlovsky thinks the plotters must borrow their justification from the dog-eared textbooks of socialism. That ideology will snap shut on Russian necks, Pavlovsky is predicting, as savagely as the bar on a rat-trap. Social justice, he implies, is nothing but the cheese.
Russia’s biggest tax evaders, the so-called “oligarchs,” didn’t need Pavlovsky to figure that the outcome of the elections might spell an end to their fortunes. A dividend remittance tax, a capital-gains tax and, maybe, a super-profits tax applied to the oil and metals companies would transfer more capital to the rest of the Russian economy, the non-oligarch-controlled economy, than the public and private sectors have been able to manage in the past decade. The boost would be dramatic. So would the financing costs imposed on the oligarchs, who, unwilling to pay the bill out of their own cashflows, would be forced to default out of the companies they have milked for so long. If this happens, this would indeed be a redistribution of economic power. But as tax measures, recognized as normal fiscal policy and public accounting the world over, not a conspiracy.
But economic normalization means a “creeping coup” to Pavlovsky, and fear of it is the reason the oligarchs have been trying to cash out of Russia. Roman Abramovich, the Sibneft and Russian Aluminum proprietor, is only the most obvious and possibly the most successful of them, having doubled his money in the privatization of Slavneft last year and then converting it and Sibneft into Yukos shares and cash. Mikhail Fridman didn’t get away quite so cleanly in the sale of his Tyumen Oil Co. to British Petroleum, but he did slip out from under a default-sized debt. Mikhail Khodorkovsky didn’t get away at all — he was trying to sell Yukos to an American oil company when his co-shareholder Platon Lebedev was arrested. Victor Vexelberg’s scheme to transfer the riches of Siberian Ural Aluminum into an offshore shell managed by the Fleming Family is petering out for lack of foreign investors. Vladimir Potanin and Mikhail Prokhorov, the owners of Norilsk Nickel, tried to cash out by swapping their shares for those of Lonmin, the London-listed miner, but the Kremlin blocked that by refusing to allow declassification of the corporate data required for such transactions. Even Anatoly Chubais, the electricity-utility director, has seen the writing on the wall and announced that he’s going into politics, running to the State Duma for refuge.
One oligarch who hasn’t attempted the big getaway is Oleg Deripaska. But that’s because he’s still in the primitive-accumulation stage, with a somewhat less-than-clean title to the most valuable properties and unable to present his assets for foreign swap, collateral and sale. Not that Deripaska hasn’t been trying to cash out, at least through transfer pricing and aluminum export operations. His recent success at getting the Finance and Trade Ministries in Moscow to abandon their efforts at abolishing his huge tax benefit — the so-called “tolling privilege” — proves that the gang behind Pavlovsky’s report still packs big guns. But, as Marlowe once said, that’s as obvious as a tarantula on a Slice Of angel food.