Courtesy Reuters

Russia's Phony Capitalism


Russia faces a watershed decision. The vital question for Russia is whether it will become a quasi-democratic oligarchy with corporatist, criminal characteristics or take the more difficult, painful road to becoming a normal, Western-style democracy with a market economy. Communism is no longer an option. That was settled in the 1996 presidential election.

Russians will make this fateful choice and be its principal victims or beneficiaries. But its consequences to Americans, Europeans, and others who share this shrinking globe should not be underestimated. Contrary to the widespread view in the United States that Russia is essentially irrelevant or of secondary concern, our continental country, stretching from Eastern Europe to upper Asia, will be important in the next century because of its location between east and west, its possession of weapons of mass destruction, its natural resources, and its potential as a consumer market.

Unlike previous choices in recent Russian history, the decision will not be made on a single day by a coup or an election. Rather, it will evolve through the many decisions made by Russia's millions of people, leaders and ordinary citizens alike, over the coming years. Even President Boris Yeltsin's sacking of much of his cabinet in March, while deeply disturbing, was one more bump along the road, not the end of the journey. Nevertheless, the route chosen will be no less important than the choices made earlier in the decade in its effect on the society in which our children and grandchildren live.

Corporatist states, marked by high-level criminality but bearing the trappings of democracy, differ more than is sometimes recognized from Western-style market democracies. Their markets are driven by oligarchs whose highest goal is increasing their personal wealth. Freedom of the press and other civil liberties are suppressed. Laws are frequently ignored or suspended and constitutions obeyed only when convenient. Corruption is rife from the streets to the halls of power. Personalities, contacts, and clans count for more than institutions and laws. For examples,

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