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A Performance of Outrage

Below is an interesting take by Yulia Latynina on the Pikalyovo public scolding of Oleg Deripaska by Vladimir Putin.  Paul Goble made a similar comment in his video interview with us.  Also see yesterday’s CNN piece on Deripaska, embedded after the cut.

The Pikalyovo incident is a classic example of how the Kremlin makes decisions. The roles and script are assigned in advance. First, Putin gets demonstratively angry at one of his court oligarchs. Then, Putin makes a decision ostensibly “for the benefit of the people,”  but since his decision is based on information provided by the oligarch in question, the oligarch walks away with everything he wanted — and more.

Why does Putin allocate state funds for uncompetitive factories and on terms that are kept secret from the public?

Perhaps the government is in no hurry to nationalize suchbusinesses. It is more advantageous for the state to wait until thecompany becomes so buried in debt that it defaults on its loans andfires all its workers. When the angry bankers and protesters finallydirect their fury at those “damned oligarchs,” the state can step inand play the role of white knight.

Who are these oligarchs anyway? They get billions of dollars instate credit in backroom deals. Putin chews them out on television, butthen they get everything they want.

Could it be that the oligarchs long ago ceased to be owners and nowonly manage those companies? Perhaps the country’s real oligarch tookcontrol a long time ago.