Understanding Post-Soviet Russia: Federalism, Decentralization, and Centralization

1. Political Changes in Post-Soviet Russia Vladimir Gel’man (EUSP/University of Helsinki) Penn State University, lecture 3, September 27, 2017 Post-Soviet Political Institutions (II): State-building, Decentralization and Recentralization

2. Post-Soviet Political Institutions • Russia is a multi-layered federal state: • federal government in Moscow, • 83 (or 85?) regional governments, • about 24000 municipal governments across urban and rural areas; • How Russian federal state is governed? • Why it tend to operate as a hierarchy (“power vertical”)? • To what extent the “power vertical” is sustainable?

3. Post-Soviet Political Institutions • Political role of any institutions depends upon interaction of three factors: • (1) constitution; • (2) genesis and trajectory of historical evolution; • (3) support among elites and mass public; • And what about federalism? • Federalism – a form of political organization, where some decisions are made exclusively by the federal government, and some decisions are made exclusively by governments of sub-national units (Riker, 1964)

4. Post-Soviet Political Institutions • If federal government cannot make exclusive decisions, then it is confederation (for instance, European Union); • If governments of sub-national units cannot make exclusive decisions, then it is unitary state (for instance, Ukraine); • The number of federal states in the world is low (22 countries), but many large countries are federations (US, Canada, Mexico, Germany, India, Brazil, Argentine, Nigeria, Australia, etc.); • … but governing federal states is a complicated matter

5. Post-Soviet Political Institutions • How Russia fits classifications of federations? • Symmetric vs. asymmetric (e.g., US vs. India) – Russia is formally symmetric, but… • Territorial vs. ethnic/religious/linguistic (e.g., US vs. India) – Russia is a mixed model (republics. vs. non-republics); • Number of federal units (from 3 in Belgium to 50 in the US) – Russia is a champion: 80+; • Right for secession – free secession (Soviet Union) vs. prohibition (US) – in Russia it is possible upon nation-wide referendum; • Joint competence – coordinated model (US) vs. cooperative model (Germany) – Russia fits cooperative model;

6. Post-Soviet Political Institutions BUT: one should nit mix up two things: federalism and decentralization; Decentralization – to which degree decisions (whether exclusive or not) are made on subnational or national level; decentralization – political, administrative, and fiscal (measured through share of federal/subnational taxes) dimensions; some federal states may be fiscally centralized (Mexico) or decentralized (Canada), but some unitary states may be fiscally centralized (Ukraine) or decentralized, too (Norway); Russia – went from high fiscal centralization through major fiscal decentralization to mid-range fiscal centralization (now comparable with the US)

7. Post-Soviet Political Institutions • But to what extent formal framework of federalism in Russia is real or it is just a façade for unitary state? • Most of politically and economically meaningful decisions are made in Moscow rather than in the regions (with some exceptions); • Informal control of Moscow over: • elections in the regions (both national and sub-national), • public behavior (protests, strikes, ethnic tensions etc.) and public opinion, • economic indicators (unemployment) and major investments; • etc., etc.

8. Post-Soviet Political Institutions • Genesis and evolutionary trajectory: • Pre-1917 Russia – multi-ethnic imperial monarchy, centralized hierarchy of government with certain autonomy in some ethnic areas (Finland, Central Asia, Poland); • limited local self-government since 1864 (zemstvo); • … and in 1918 after the Bolshevik revolution Russia proclaimed as a federation; • 1922 - Union Treaty (Soviet Union established as a federation)

9. Post-Soviet Political Institutions Soviet federalism: Ethnic-based; Multi-layered (four different status groups: union and autonomous republics, autonomous oblast, autonomous districts); Free secession and free entrance declared; Changing status of republics over time (repressions, redrawing of boundaries, etc.); High level of political, administrative, and fiscal centralization; Until the late 1980s federalism remains merely on the paper, but…

10. Post-Soviet Political Institutions Ethno-nationalist mobilization contributed to separatism (Baltics, Moldova, Georgia, Armenia, Ukraine) – 1990-91 referenda on state independence; The rise of ethnic conflicts (self-proclaimed republics of Abkhazia, South Ossetia, Transdnistria); … and what about Russia? The drive to ethno-nationalist mobilization and proclaiming of “sovereignty” in ethnic republics in 1990-91; Russian government – weak and incapable to stop these claims; Appeasement as a successful ad hoc strategy?

11. Post-Soviet Political Institutions

12. Post-Soviet Political Institutions Yeltsin’s speech in August 1990 in Tatarstan: “you can take as much sovereignty as you can swallow”; Negotiations with ethnic republics regarding their special status in Russia (not implemented in the 1993 constitution); Non-ethnic units of Russia joined the bargaining process in 1992: a major turn from “Swiss cheese” model to a full-fledged federation; Appeasement via fiscal transfers – buying loyalty of republican and regional elites (Treisman, 1999); Political model after 1991: appointment of regional and local chief executives in non-republic regions (aka “power vertical”)

13. Post-Soviet Political Institutions Since 1994 – bilateral treaties as a tool of negotiations; Decline of federal control over fiscal flows (in 1998, federal taxes were of 42% of national budget) and over coercive apparatus (de facto regional control); Since 1996 – direct popular elections of regional governors, the rise of regional political regimes (instances of sub-national authoritarianism in many cases); 1998 economic crisis – the huge blow on regional economies, demand for recentralization; 1999 State Duma election – the struggle between the Kremlin and loose coalition of regional leaders (the Kremlin won); May 2000 – president Putin announces “federal reform” as a top priority

14. Post-Soviet Political Institutions Federal reform, part 1 (2004-2004): Federal districts were established, central control over law enforcement and taxation agencies restored; Regional chief executives and chairs of regional legislatures were removed from the Federation Council; En masse revision of regional legislation in order to keep it in line with federal regulations; Tax revolution: revision of taxation rules and restoring of centralized control over major sources of taxation (VAT, unified social tax, subsoil use tax), federal share of taxes increased to 2/3 of all taxes in Russia; Political tools: encroachment of the Kremlin to regional elections in order to remove “undesired” regional leaders and politicians

15. Post-Soviet Political Institutions Federal reform, part 2 (2004-2012); Abolishment of popular elections of regional chief executives, turn towards de-facto presidential appointments and dismissals (until 2012); Elimination of popular elections of city mayors in most (but not in all) of Russia’s big cities, turn toward council-based or city-manager models; Reforming of regional electoral systems in legislative elections: no less than 50% of seats to lists of nation-wide political parties – United Russia seized control over all of the regional legislatures by 2007; Major criteria of survival of regional chief executives: political loyalty vs. socio-economic efficiency (Reuter and Robertson, 2012); Extension of “power vertical” from governors and city mayor to school principals and enterprise directors (Frye et al., 2014)

16. Post-Soviet Political Institutions Case study 1: Tatarstan

17. Post-Soviet Political Institutions Leading actor in ”sovereignty” movement in the 1990s, first bilateral treaty signed in 1994 (political compromise), then extended twice till 2017; Gains control over taxes (paid only 20% of taxes), assets (including oil company, Tatneft), language issues (de-facto ban on positions in the republican elites for non-Tatars), etc.; In the 2000s – decline of special status but still economic priority via federal funding and investment programs and relatively efficient governance

18. Post-Soviet Political Institutions Case study 2 – Chechnya

19. Post-Soviet Political Institutions • A long history of traditionalism and non-compliance: • Chechen wars in the nineteen century (1819-59), de-facto special status in imperial Russia; • Rebellions in the 1920-30s under Soviet Russia, collaboration with Nazi during World War II, exile into Central Asia (1944), restoration of status of autonomy in 1957; • September 1991 – overthrow of Communist leaders, power seized by nationalist Congress of Chechen people, general Dudaev proclaimed as a president, declaration on independence; • November 1991 – Russian leadership claimed the state of emergency, no way for military solution, de-facto independence (“forgotten area”) till 1994;

20. Post-Soviet Political Institutions • 1994 - Russian military ground operation (First Chechen war);

21. Post-Soviet Political Institutions • Response – terrorist attacks of Chechen guerilla in neighboring regions and counter-attacks to Russian troops; • Temporary solution of 1996 – Khasav-yurt agreement, postponement of solution of status of Chechnya; • De-facto control of field commanders over Chechnya, no re-integration to Russia at all; • 1999 – encroachment of Chechen gangs into Dagestan, bomb explosions in Moscow and in other cities, and the start of the Second Chechen war (1999-2002)

22. Post-Soviet Political Institutions • Regaining control over Chechnya – a sense of revenge among Russians; • Better prepared and more efficient military operation, but terrorist responses were harsh (2002 – Moscow, 2004 – Beslan); • Divide-and-rule tactics: Moscow loyalists in Chechnya (Kadyrov)

23. Post-Soviet Political Institutions • Huge federal funding of Chechnya; • Full control of Kadyrov over the region and much beyond (almost no federal influence); • Dreams of Chechen leaders in the early 1990s became true under Kadyrov?

24. Post-Soviet Political Institutions • How the “power vertical” is working? • Not only the chain of commands but also a mechanism of sharing of rents; • Rewards and punishments on the top-down manner (reshufflings of regional and local governments, waves of arrests, etc.); • Slight adjustments in 2012 – regional chief executive elections restored with “municipal filter” (almost no competition, exceptions which prove the rule); • The new challenges lies ahead?

25. Post-Soviet Political Institutions • Extension of the ”power vertical” beyond Russia? • Case study 3 – Crimea

26. Post-Soviet Political Institutions • Crimea – base of Black Sea fleet (Sevastopol), transferred from Russia to Ukraine in 1954 (2 million residents, 12% of Crimean Tatars); • 1991-2014 – part of independent Ukraine (Crimean autonomy), some pro-Russian support among local residents, special status of naval base; • February 2014 – overthrow of Yanukovych in Ukraine; • March 2014 – Russian annexation of Crimea through popular referendum (83% turnout, 96% for joining Russia) – in most instances the vote reflects sincere will of Crimean residents…

27. Post-Soviet Political Institutions • What next?

28. Post-Soviet Political Institutions • Q: what are the strong and weak sides of the model of sub-national governance in Russia, known as the “power vertical”?