In 2007, the government created the Russian Corporation of Nanotechnologies (Rusnano), entrusted with the development of chips, renewables and much else. One of the largest corporations in the country, Rusnano was led by Anatoly Chubais, a former head of the Russian Presidential Administration. The corporation had an enormous and non-transparent budget. From time to time, it leaked stories about its plans for natively produced laptops or solar panels, but such products never reached the market. From 2016, the corporation was on the edge of bankruptcy. In 2021, Chubais left Rusnano to become Putin's Representative for Sustainable Development. Even his startling confidence, however, was of little benefit in developing sustainability. In March 2022, as the Russian troops were approaching Kyiv, Chubais fled the country; reportedly, he was poisoned in August but survived.
When Russia launched its all-out war, the Europeans said goodbye to Russian oil, Putin's officials to their yachts, and Moscow hipsters to their smoothies. Rather than proving that Europe could not do without Russian energy, the war demonstrated the dependence of Russian industries on Western imports. Amazingly, even the printing of rubles required Swiss pigment, and the salmon on fish farms needed Norwegian food. With the advent of the war, neither rubles nor salmon looked the same.
The rubble and the ruble
Socialism was born in the era of coal. Fed by proletarian discipline, the new creed reflected and later shaped the life of large working collectives.16 Coal mines and coal-powered industries were the cradle of social democracy. Social welfare states - Weimar Germany, New Deal America, the Britain of the Old Left - did not survive the era of oil. Eventually they turned to neoliberalism - the liquid modernity of flowing oil, floating prices and fleeing capitals.
From its beginnings, Soviet-style socialism depended on coal but dreamed of oil. At the start of the twentieth century, the oil boom in Baku, a distant colony on the Caspian Sea, enabled the Russian Empire to overtake its rivals in oil exports. Future Bolshevik leaders, including Stalin, Beria, Vyshinsky, and many others, got their revolutionary initiation on the oil fields of Baku. But the masses of organized workers - miners, dockers, railmen, steelmakers and smiths - toiled with labor- intensive coal. Organized in trade unions, they launched waves of industrial action such as the all-Russian October strike of 1905, which paralyzed the country. Trained in Baku, the future Soviet leaders preferred oil, which brought power and money with less work and less workers.17
During World War II, the oil-rich Caucasus was one of the main targets of the Nazi assault. Baku was not occupied but many drills had been shut by the retreating Soviet troops. The American land-lease scheme supplied enough petrol and kerosine to the Soviets to win the war. The fields of Baku were depleting anyway. In the postwar period, Soviet geologists discovered abundant oil reserves in Tatarstan and later in Western Siberia; Stalin and Brezhnev affectionately called these new sources of revenue the Second and Third В akus. Siberian oil was a boon for the Soviet leaders, granting them a decade of stability.
Oil exports secured the Soviet Union's state capacity and enabled its military build-up. In the late 1970s, new pipelines delivered oil and gas from Western Siberia to Western Europe. However, their crucial elements were manufactured in Germany or the US. Exchanging native oil for foreign grain compensated for the astounding inability of the Soviet system to produce food for its citizens (before and after the Soviets, Russia was a major exporter of grain). North American wheat fed the Soviet cattle which fed the Russian people. But soon it became clear that it would be cheaper to buy frozen meat abroad, and the cattle disappeared. Fresh into power in 1985, Mikhail Gorbachev was very much concerned about the depleting oil reserves: the entire country depended on them for sustenance. The drop in oil prices plunged the Soviet budget into a deficit that billions in foreign aid couldn't fix. It fell upon Boris Yeltsin's government to carry out its economic reforms at a time of cheap oil. In 2000, when Yeltsin appointed Putin to be his successor, oil prices rose again. The Fat Years of oil- fed prosperity began, and the renewed propaganda machine attributed this success to the young president.
The new rulers of Russia discovered that Western knowledge could resolve all issues of oil extraction and transportation in exchange for a fraction of the exported treasure. Not only could grain and meat be bought this way, but also car factories, pipelines and managers. Between 1999 and 2004, the output of Russian oil fields increased by 50 percent. Global prices were also rising, and the Siberian exports almost doubled in cash value. But these were only the direct receipts from foreign trade; a portion of the extracted fuel was consumed within the country at subsidized prices, bringing taxes to the treasury and amplifying state profits through the "funnel effect."18 Taking this into account, we see about half of Russian GDP created by fossil fuels. The exchange value of the ruble obediently followed the price of oil. The physicist Boris Nemtsov, a leader of the anti-Putin opposition who was murdered in 2015, proposed a linear formula for the relation between the value of a ruble and the price of a barrel of oiclass="underline" in dollars, these two curves floated as one. The efforts of millions of Russian workers, farmers and intellectuals had no impact on the price of the ruble. The entire Russian economy relied on the oil fields of Western Siberia.
The burning of gas, oil and coal for domestic needs diverted a valuable resource from the foreign market and decreased the revenue of the state. This was a burden the government sought to reduce. "Checking consumption in the mother country," as they put it in the nineteenth century, was a traditional task of the mercantile empires: the less people consumed domestically, the more would go to the treasury. The small Gulf-style petrostates relied on underpaid migrant workers for labor. But sustaining extreme levels of inequality was more difficult for petrostates with large native populations, such as Russia, Nigeria, Indonesia, Venezuela and, until recently, Mexico. Their carbon incomes were sufficient for meeting the demands of the elite, but never enough for supporting the people. Balancing these tasks was easier in times of growth and more difficult during slumps, when these governments regularly announced plans for diversification and modernization. None of these promises were ever kept.
Only a religious or nationalist narrative could explain the fateful chance that endows some countries with an abundance of resources and others with none. God or chance arranged things so that the distribution of oil largely maps onto confessional divides. In the 2000s, Islamic countries exported more than half of global oil.19 There was also a link with an ideology, even if one now mostly abandoned: a quarter of global oil was extracted in three post-socialist countries - Russia, Venezuela and Kazakhstan. Eager to understand the meaning of their blessing, the oil-rich elites reworked the idea of a chosen people. Mystical nationalism helped them to distinguish between their own peoples, who received the state's charity, and aliens who did not. For the elite, charity confirmed their self-awareness as a chosen people who had earned their wealth and spent it wisely. For the population, this narrative turned citizens into paupers, working people into beggars. Ideal for corruption, fossilized carbon proved to be an unreliable foundation for a state. It became part of a vicious circle of evil that led to aggression outside and degeneration inside these countries.