Tuesday, September 02, 2014


Features

Corruption in Russia, Part 1: A Normal Part Of Everyday Life

A visitor at a state administrative office holding money to bribe a clerk in Kurgan in September 2007
A visitor at a state administrative office holding money to bribe a clerk in Kurgan in September 2007
By Gregory Feifer
Russian President Dmitry Medvedev has made fighting corruption a centerpiece of his presidency. But many Russians don’t believe he'll make good on his word, saying corruption is central to the way business and politics function. In the first of a three-part series, RFE/RL's Gregory Feifer reports from Moscow on a culture of corruption that even Medvedev says is threatening Russia's viability as a state.

MOSCOW -- Just about every driver in Moscow knows the procedure.

Stopped by the traffic police and threatened with a large fine -- or worse, confiscation of your license -- you contritely wait for the right moment to negotiate the price of a bribe, usually around $20.

Sitting in his car on a central Moscow street, Vladimir Maltsev says that happens almost every day.

"As a driver, I deal with the traffic police all the time," he says. "They're all corrupt. Absolutely every one is a bribe-taker."

Maltsev says police often set up obstacles on the road that force drivers to break the law by crossing double lines, then wait nearby to pull over their victims.

But he says that's trifling compared to the corruption that threatens his personal livelihood. A small-business owner, Maltsev says the tax police recently blocked his company's bank account, claiming his company failed to file a vital document.

When Maltsev showed up with the proper paper, bearing a stamp proving it had indeed been filed, he was still made to wait in line at an office that never appeared to open.

"I kept returning for three weeks," he says, "until someone came up to me and suggested where I should go to pay a bribe. After that, everything was fine."

Maltsev says such routine corruption paralyzes companies. "Business owners are ready to do anything to unblock their bank accounts," he says.

Bribery is an institution in Russia: students pay teachers for better grades, patients pay doctors for health care supposedly provided free by the state, families pay off draft boards to keep their sons out of military service.
It's like oil in a car's engine. The system can’t work without it. It prefers that kind of relationship, and it makes up for the ineffectiveness of institutions


Sixty percent of Russians admitted to giving bribes in a recent poll. Earlier this year, President Dmitry Medvedev said corruption is so bad it threatens Russia's very stability.

"The battle against corruption in our country," he said, "is an especially difficult task that will demand colossal efforts and perseverance over many years. But today, I can say that we're already seeing some progress."

Medvedev first promised a major campaign against corruption when he took office last year. He and other top officials publicly declared their incomes and assets for the first time, in a widely publicized show of action. But some of the results strained credulity: Chechen leader Ramzan Kadyrov, who lives in a palatial, marble-clad mansion, admitted to owning only a small apartment and a Lada car.

Business owner Maltsev believes that like other recent anticorruption drives, Medvedev's campaign is only window-dressing. "It's only words," he says. "Corruption has always been all-pervasive. It's an integral part of our state."

History Of Anti-Corruption Drives

Medvedev is far from the first Russian leader to promise tackling corruption. Ten years ago, his predecessor and mentor Vladimir Putin came to power promising to wipe out corruption by enacting a "dictatorship of the law."

But the problem has grown far worse since then: a decade-long, oil-fueled economic boom has emboldened the country’s bureaucrats to demand even bigger bribes, even after the global financial crisis sent the economy into a tailspin. Today, Transparency International ranks Russia one of the world's most corrupt countries, 146th out of 180 on its corruption perception index.

Even the government's own figures say the average bribe has tripled in size since last year, to $32,000. Russia's "corruption market," officials say, is estimated at $300 billion a year, and inflates the price of everything from real estate to food, as companies pass on the hidden costs of doing business.

Former First Deputy Prime Minister Boris Nemtsov, now an opposition leader, points to the price tag of a kilometer of road now under construction in Moscow -- $570 million.

"If you compare the cost of Moscow's roads to the Large Hadron particle collider in Switzerland," he says, "the collider is cheaper, as is the Channel Tunnel [between Britain and France], another grandiose construction project."

Moscow was rated the third-most expensive city in the world in 2009, behind only Tokyo and Osaka. Nemtsov says it's no accident the Russian capital remains one of the priciest places on earth. He says its costs reflect a closed political system in which construction companies enjoy close ties to Mayor Yury Luzhkov.

Nemtsov recently published a report about Luzhkov, who he says funnels contracts to his wife, the head of a large construction firm that's made her Russia's richest woman.

"In any country in the world -- the Czech Republic, Britain, Germany, even Italy," he says, "it would be cause for a criminal investigation. Those two would be sitting in jail instead of City Hall. But not in Russia."

Nemtsov says Luzhkov and his wife Yelena Baturina are "so odious" that any move against them would send a loud signal to politicians and law enforcers across the country. But so far, Nemtsov's claims have only earned him a libel suit filed by the mayor, hearings for which began on November 25.
Anti-corruption fighter Ilya Handrikov


Few Russians believe Luzhkov, Baturina, or any other high-placed officials will be called on the carpet for corruption. Last year, a watchdog called the Anti-Corruption Committee set up hotlines across the country. The group's director, Yevgeny Arkhipov, says the opinions of thousands of callers show the lack of perceptible change following Medvedev's promise to fight corruption is disenchanting an increasing number of Russians.

"Many have stopped believing it's possible to defend their rights if they're the victims of corruption," he says.

Arkhipov and other members of his group were forced to flee the country last year, just as they were preparing to publish a report on corruption, after being warned they would be investigated. They released their findings in Ukraine, where they took refuge for two months.

Arkhipov says such intimidation is making Russians afraid even to discuss corruption in public. He says the authorities have marginalized civil society, eroded public institutions, and cracked down on freedom of speech to such an extent that many Russians no longer know even how to go about defending their rights.

"The stricter the authorities' control, the more their activities are hidden from the public," he says, "the more difficult it is for people to fight corruption. Better to pay a bribe than start a conflict with an official."

Fighting Back


Some are taking matters into their own hands.

In a small Moscow textile factory that produces uniforms for the likes of McDonald's, Pepsi, and Procter & Gamble, workers hunch over sewing machines.

In his cramped office near the factory floor, owner Ilya Handrikov says his company is regularly visited by fire inspectors and financial regulators who demand bribes to stop them from reporting fabricated violations.

It's helped drive Handrikov to become one of the country's most prominent corruption fighters, launching one organization aimed at aiding businesses, and working with numerous others. He points to figures showing the number of state bureaucrats has doubled from 1 to 2 million in the last decade, saying the culture of corruption is choking any hope Russian businesses can be competitive in the world.

"Manufacturing has been essentially destroyed," he says. "Small and mid-size businesses have been trampled. How can you expect companies under pressure from taxes, monopolies, and political clans to create innovative ideas? They can’t, because all their energy goes to just trying to survive."

Many question how corruption can be measured or even defined in a society in which it's seen as a normal part of everyday life. Pollster Lev Gudkov maintains it can, but that any measurement must include far more than the amount of money that changes hands. "For example, big business can only function," he says, "by 'paying' with political loyalty to the authorities."

Gudkov says Russia's "cynical climate of immorality" can’t be tackled as long as most Russians see a benefit in corruption as a necessary means of getting things done.

"It's like oil in a car's engine," he says. "The system can’t work without it. It prefers that kind of relationship, and it makes up for the ineffectiveness of institutions."

Gudkov calls Medvedev's ongoing anticorruption campaign "political theater." It's not a question of a deficiency in Russians' morality," he says, "but of how Russians' practical social and political systems are structured."

Real change, he says, has to be seen as being in people's interests. "Who's going to deprive himself of his own bread and butter?" he says, "That's just not realistic."
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