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Russia's Artificial Middle Class

Moscow Interbank Currency Exchage
Moscow Interbank Currency Exchage
We pretend to work -- and they actually pay us!

For the past decade, Russia's emerging "middle class" got a pretty good deal. The Kremlin was determined to create a stable and sizable cohort of happy, well-fed, and status-conscious consumers who would provide the regime with bedrock political support -- or at least tacit acquiescence.

They drove cool cars, sported the latest fashions, played with trendy gadgets, and ate in fancy restaurants. All the things that were reserved for the oligarchic class and their hangers on throughout the 1990s were suddenly available to an emerging bourgeois. Russia's magical new middle class had arrived.

And how did this new class earn the income to support their lifestyle? Well, there's the rub. The whole thing was a mirage, subsidized by the state and Kremlin-connected corporations with the help of a seemingly endless flow of petrodollars.

And now that is all at risk.

I recently spoke to Boris Kagarlitsky, director of the Institute for Globalization and Social Movements, who described the arrangement as a twist on the cynical old Soviet saying describing the social contract under Communism: 'We pretend to work and they pretend to pay us.'

Now we pretend to work and they give us money for real. Our social function is to consume, that's our only social function...

Go around Moscow and ask people what they are doing. Take a poll at any restaurant. You will discover that most people cannot even explain what they are doing. If you ask about their jobs they will give their job title. And if you ask what the job is about they will not be able to explain this. In Moscow we have about one million people doing nothing. Getting nice salaries for doing nothing. That was part of the policy. They gave people money to consume...

I was speaking to a young man. He is 23. He just graduated from university. What's his job? He's an advisor. A 23-year-old advisor. An advisor to whom? To the director of his company. What is the company doing? It is giving advise. To whom? To advertising companies. The whole company will go to the dogs. It's 300 people doing nothing. You get $4,000 per month for giving advise to people who will give advise to other people who will think about giving advise to another group of people.

Nice work, if you can get it. And as the economic crisis continues, fewer and fewer people will be able to get it. And that, says Kagarlitsky, is when the trouble will really start for the regime:

This is bad news for the government. They created this middle class. They were breeding it for more than 10 years...It can survive only by being subsidized by the state and the corporations, heavily subsidized. As long as you can keep them subsidized they are ok. But once you stop subsidizing these artificial jobs for the artificial middle class, it is going to disappear. And that is a major source of a potential explosion.

In his 1969 samizdat text "Will The Soviet Union Survive Until 1984?" the dissident writer Andrey Amalrik wrote that Soviet society was divided into three classes: a ruling "bureaucratic upper stratum" that was "rotting and incapable of government-level creativity"; a "middle stratum" of professionals and intellectuals that was cautious, passive, and fearful of losing its limited privilege; and a lower stratum made up of workers that was potentially "a destructive force."

Amalrik wrote that the system could only remain stable if the middle stratum grew. If it didn't, then the other two classes would drag the system down.

Sergey Shelin at "" and Paul Goble at his blog "Window on Eurasia" have both noted that this 40-year-old text also applies to present-day Russia. Here's Goble:

But what is striking for one who rereads him now, something even the many who know his title have not done, is just how contemporary his argument and even his specific phrases sound and how much they resemble the content of many articles in Russian newspapers, journals and websites.

Members of Russia's prefab middle class have seen their living standards rise steadily over the past decade -- and expected those improvements to continue indefinitely. How will they react when it becomes clear to a critical mass that this will no longer be the case?

-- Brian Whitmore

About This Blog

The Power Vertical
The Power Vertical

The Power Vertical is a blog written especially for Russia wonks and obsessive Kremlin watchers by Brian Whitmore. It offers Brian's personal take on emerging and developing trends in Russian politics, shining a spotlight on the high-stakes power struggles, machinations, and clashing interests that shape Kremlin policy today. Check out The Power Vertical Facebook page or


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