Albert Camus wrote that every generation feels confident it will change this world. His own generation, he continued, already knows it will never do that, yet its mission could be even greater: not to let this world perish.
In describing Ukraine’s political space, it is important to point out a number of major trends which, in our opinion, produce a strong enough effect on everything that happens in this country.
Let us start with the basic elements. The new social, political, and economic model still has far too risky a character; it is unstable and, most importantly, it has failed to solve the main contradictions of the Soviet model. The economy stays in the red and ineffective, political leadership remains corrupt and incompetent, while intellectual regulation proves dogmatic and steeped in myths.
The process of political reform is practically at a halt and social development has acquired a different content: a degree of stability and consolidation of the power structures, use of formally democratic procedures for the self- renewal and legitimization of the regime.
A process of differentiation is underway between the regime and the people such that a passive citizenry is becoming the rule, as shown by the special elections to the Verkhovna Rada when voter turnout was a stunning 30%. Moreover, what we have now is an unresisting society with the state being in omnipotent control on the one hand and social demands of the populace quickly falling on the other, as a result of being constantly inured to poverty, losing the last hope for returning to previous living standards.
And then, for the first time, Viktor Yushchenko’s kamikaze Cabinet came to power, unleashing an inter-faction struggle, being torn from within by deep and purely clannish contradictions. As for its policy, it reminds one of a weightlifter who, rather than lift the barbells, explains to the audience precisely how this is done, interrupting the narration for morning calisthenics.
The parliamentary movement in Ukraine is gripped by a severe crisis. The Verkhovna Rada is completely discredited in the public eye and responsible for plummeting living standards.
Ukraine is on the verge of a business crisis (just like in Russia in 1998). The idea is to disrupt the parasitic structures formed to date, so as to make room for business entities truly viable and useful to society.
Finally, one cannot but notice the formation of a Ukrainian Bermuda Triangle consisting of the regime, Communists, and nationalists. This is an absolute paradox that could happen only in this country. But the Reds and the nationalists are opposed to the current regime, accusing it of conspiring with their common enemy. The Communists describe the regime as “bourgeois nationalistic,” and the nationalist call it a bunch of sell- outs. Meanwhile, all three components are united by one thing, Soviet collectivism, it being a state priority.
Such are the trends. Now let us try to consider some of the most important scenarios.
If I were asked which of the processes underway in Ukraine is the most alarming, I would never hesitate to point to the mounting effort to politicize this society, getting it involved in all kinds of political shoot-outs. All this strongly resembles the situation in 1989-92, but it was due to revolutionary events at the time, initiated from below.
Today, the motive force is found among those who should by definition oppose this most actively: big-time capital. The impression is that these people are still reliving the previous two election campaigns, still playing out an old scenario no one needs any more, drawing one and all into the game, the Cabinet included.
This is very dangerous, because the political masquerade leaves no room for the economy, for everyone is immersed in political games. Yet the process is by no means coincidental, caused by deep-reaching political and economic problems.
Much is being said and written about the Ukrainian oligarchs. In fact, the notion has become nationalized, which is very bad, of course. Yet we will discuss not who calls whom an oligarch and how such oligarchs are being treated, but the political possibilities of such people. The possibilities are vast and this is especially true of all those financial-political groups with their bank accounts, influential media, political parties, highly paid lobbyists at all echelons, and of course powerful production capacities — plants, factories, mines, etc.
On top of this pyramid are some 15 teams whose gross annual product amounts to $15-20 billion. By way of comparison, Ukraine’s annual GDP ranges between 27 and 28 billion dollars.
Imagine what these people are capable of in the political domain, especially if they combine efforts. They have already done so once, organizing the Right-Center majority in Parliament. And they did an excellent job. Of no lesser importance was their contribution to Leonid Kuchma’s victory in the presidential race.
But all this happened previously and was governed by circumstances. At present, internal and external factors are actively at play that could seriously destabilize the oligarchic environment, subsequently producing a negative effect on the political and economic status of some of these people. Here is why.
The technology and mechanism of accumulating capital were similar in the case of many oligarchs. Virtually free natural gas and electricity used to acquire ores and coke, and finally metals spelling big money. Other techniques included farm products, but only as a supplement to the energy sector components. Well, to everything there is a time. Energy socialism is drawing to a close. Very soon cash will have to be paid for everything, raw materials, electricity, and gas included. And finagling will be replaced by sound management. The time of bazaar-barter capitalism is drawing to a close.
In view of the above, let us get back to the business turnover of all those financial-political groups. It is mind-boggling, yet Hayek once pointed out that capital is an insatiable beast that must be constantly fed, otherwise it will instantly devour itself and its master. How many billions are necessary to feed all those other billions? Where do we get all this money? From the national purse, of course. But it does not have enough for all concerned, which means they will have to fight for it. There is another option, but few will want to look for any other options, let alone to start from scratch. And so there will be political free-for-alls and another redistribution of property, on the one hand, and new people with entirely new approaches on the other.
Actually, the war has already started. A content analysis of the Western press over the past three months shows that influential US, British, French, Belgian, Swiss, and Russian periodicals appear with negative articles about Viktor Yushchenko, Hryhory Surkis, Yuliya Tymoshenko, Oleksandr Volkov, and Pavlo Lazarenko at an interval of 3-5 days. Tentative estimates point to at least a hundred such articles from March to June. Unfortunately, all such publications damage Ukraine’s international image. In this manner the Western public is led to believe that Ukraine is one of the world’s most corrupt countries. What foreign investment can be expected under the circumstances?
Can our oligarchs unite? I think not, and here is why.
The situation in Ukraine has long been such that the powers that be had to bow and scrape before business quarters. Now the tables are reversed. Those in business are clearly afraid of those in power. Quite a few Ukrainian capitalists feel like servants waiting on their landlords, the politicians. And public consciousness is such that people saying money means power invariably have something criminal in mind. Meanwhile, money indeed means power, and big money means big power, except that this power is not supposed to mean government. In any civilized society no one has greater freedom than a businessman operating on a large scale. This freedom is what gives them power; they can afford to be independent of the state, feeling like citizens of the world, transforming the visage of their own country by implementing large commercial projects (especially those eager to become reputable patriots). What’s good for General Motors is good for the nation. Sounds like a sensible approach of the state toward society and business.
In Ukraine, business is unaware of its power other than that of the government. And those that do so use this power for the wrong purpose. Bribing a politician, directly or otherwise, does not mean that the bribe-giver is powerful; on the contrary, it points to that giver’s weakness, and insecurity.
Consider one more trivial point. The other day, a second-year student posed me a question during a lecture which sounded paradoxical. He asked if I was sure the President needs the kind of majority in Parliament that we have. Indeed, what would give Mr. Kuchma a bigger headache: the Leftist ideological slogans or the majority’s claims to power, finance, resources, and posts? The majority could unite one day and present an ultimatum.
Also, we constantly hear about the weakness of the Ukrainian political parties, that their impact on political life is insignificant. Yet no one denies that there do exist certain objective political interests. Meaning that there must be forces capable of perceiving and defending these interests. There are such forces, of course. Powerful well- organized clans and, as has been mentioned, their internal struggle in many respects determines Ukraine’s socioeconomic progress.
The struggle among clans is more severe and immoral than that among the political parties. The reason is not only low political culture in Ukraine, but also — and perhaps most importantly — an essentially different nature of such clan confrontations. Here the fighting is to the last man, until either of the warring sides emerges triumphant. And the end justifies the means: politically discrediting the enemy and economically strangling the rival.
The need for legitimization, albeit superficial, forces the clans to seek cover for their activities. Political parties are this cover and because of this their activities are not constructive or creative in terms of the political structuring of this society. Quite the contrary, they impede the process, preventing the formation of social strata and consolidation of the entire society.
The oligarchs’ and parties’ unstable position in the political space has placed the bureaucratic machine in the forefront, as was the case a decade ago. Bureaucracy is real power in the center and the provinces, a force with which everybody has to reckon, nay take orders from, without question. One might also say that what is known here the so-called administrative resource has turned into the only active implement of power. Most of the current political beau monde believe in bureaucratic omnipotence so much that they regard the political structuring potential as a fancy dress mask.
However, it has long been noticed — but not in Ukraine — that raising the administrative resource to the absolute results in all political organizations and their constructive efforts becoming unnecessary, even unprofitable for those with means. It is then much easier to buy several ranking officials who will pull administrative levers at the central or regional level as instructed by the buyer.
This political collision begot the “fourth phenomenon of power”: transformation or, more accurately, return of the Presidential Administration to a separate branch of government. This, in turn, has dramatically increased Volodymyr Lytvyn’s role and importance. He has actually become the fourth cornerstone of power, a heavy and hazardous burden.
Many of the high and mighty in Ukraine take a dim view of Mr. Lytvyn’s rise to power. Personally I am convinced that he will shortly find himself the target of a campaign similar to that once waged against Dmytro Tabachnyk.
In view of the above one must broach another relevant subject. After reelection, Leonid Kuchma entered 2000 as his most dangerous year in office. He has never experienced such negative conjunctures, in both the domestic and foreign political realms. Under such negative socioeconomic circumstances he has no alternative but carry out very painful social reforms in a country where almost half of the budget is spent catering to the state: the army, bureaucratic machine, tax concessions, subsidies, and salaries for spending units. Add here coal miners, people working in the energy industry, defense sector, and other problem makers.
If one takes a closer look at today’s budget revenue sources and compares them to those in the recent past, the picture becomes dramatically clear: over the ten years of independence the state has allowed all such principal sources to be pocketed, while piling up rather than reducing budget spending.
It is thus not surprising that this nation, aging by inertia, continues to rely on the state the way it did under the Soviets, hopefully waiting for the President to take steps to improve people’s socioeconomic status after the last referendum. Consider some statistics from a poll done by the Strategic Communications Center this May.
In response to the question, “What do you expect from the past nationwide referendum?”, 65% replied better living standards; 54% said better performance by the industrial enterprises; 61% expected wages and pensions paid on time; 38% said more active struggle against corruption; 26% believed that the referendum would bring positive changes, and 48% did not expect any.
When asked who they would vote for in case of early elections, if their living standard did not rise before the end of 2000, some 33% replied they would vote for the Left. Apparently, the number of protesters does not diminish from one election campaign to the next, although everybody realizes that voting for the Communists is a gesture of irritation rather than ideology. A brutal or bribe-taking bureaucrat can get the Left more votes than any ardent Marxist.
Hence the only logical conclusion is that living normally or trying to build a civilized state is impossible without social reform. But once such reform is tried, it is sure to encounter a tidal wave of protest. In fact, this protest is reaching the boiling point. I would not advise all those hotheads to campaign for early elections. Actually, who needs them? It is perfectly clear that the state will remain the principal player (not umpire) in the game of the economy in the foreseeable future; there will be no deprivatization of power, just another political show of replacing part of the elite.
