The “good Soviet Union,” an imagined politico-economic order that somehow resembles that of the Soviet past while lacking its inherent flaws, bears little resemblance to the late-Soviet experience. I believe that these elements of the Soviet legacy are selectively and deliberately chosen for the sake of power maximization of the post-Soviet ruling groups. They include the hierarchy of the power vertical, “cadre stability” on all levels of government (that is, low elite circulation), a closed recruitment pool of elites and their formal and informal privileged status, state control over major media, state repressions toward organized dissent, and so on. Meanwhile, other elements of the late-Soviet politico-economic order, such as relatively low inequality and certain state social guarantees, have been discarded without meaningful resistance. In addition, the “good Soviet Union” includes certain features that did not exist in the real Soviet Union but are very important for ruling groups: not only a full-fledged market economy and no shortages of goods and services, but also a lack of institutional constraints on rent-seeking and the creation of an external interface for legalization of incomes and status abroad. The assertion that the “good Soviet Union” is a deliberate construction by post-Soviet ruling groups and their entourages is no wild exaggeration. In the 2000s, they obtained that which they wanted but which was unavailable to their late-Soviet predecessors in terms of status, power, and material well-being, and their efforts to preserve this normative ideal have borne fruit in many ways.
The use of the Soviet legacy as a set of real and/or imagined building blocks for post-Soviet institution-building and practices of governing the state contributed to the preservation of the status quo of bad governance through fragmentation or translation of this social construct into major choices and solutions. Examples include the transformation of government structure after the Soviet collapse regarding the state apparatus,40 and practices of control and accountability in law enforcement agencies,41 both of which extended the lives of outdated institutions and organizations, thus contributing to the ineffectiveness of government. This approach affects policy-making regarding the organization of state bureaucracy and its motivations.42 As a result, the “good Soviet Union” as a normative ideal has not produced incentives to overcome bad governance and improve government effectiveness, even should these be declared policy goals. Rather, the “good Soviet Union” as a foundation of the post-Soviet “mental model” has become a successful instrument for the legitimation of a politico-economic order of bad governance—at least within the mid-term perspective, until the current generation of post-Soviet rulers and citizens leaves the public scene.
To summarize, the role of the “legacy of the past,” which has preserved bad governance in post-Soviet Eurasia and beyond may be primarily considered in ideational terms: these normative ideals and role models affect policy choices and many organizational and institutional solutions. This legacy, which has allegedly doomed some countries to corruption and ineffectiveness, is largely a social construct that is created and maintained by ruling groups for the sake of power maximization. The countries of Eastern Europe and the Baltics have to some extent denied this normative ideal and thus increased their chances to overcome bad governance. However, those countries of post-Soviet Eurasia that see the sources of modern government in their imagined glorious or inglorious past could create a vicious circle of bad governance.
The Power Vertical as a Hierarchy of Bad Governance
The term “power vertical” is usually used to describe the hierarchical model of subnational politics and governance in Russia and other post-Soviet countries.43 It implies formal and informal subordination of levels of authority and a web of informal exchanges between them (for electoral authoritarian regimes, vote delivery is one of the major resources in these exchanges). But similar mechanisms are employed not only in territorial but also in sectoral governance (including the public sector). One might observe sectoral power verticals within the law enforcement apparatus, educational institutions, and some NGOs. Private business is also involved in numerous informal exchanges within the power vertical, but it enjoys a broader autonomy.44 These exchanges include not only distribution of rents but also compliance (or noncompliance) with formal rules and norms and changes in formal institutions. The power vertical is widely perceived by many Russian citizens as the legitimate mechanism of governance because of the possibility of hierarchical top-down control over lower-level officialdom. These perceptions are reinforced by the post-Soviet experience of the 1990s with its protracted decline of state capacity and major distortions of law and order after the Soviet collapse;45 this experience also serves as an additional argument for using the power vertical as the main, if not the only, tool of governance. As long as the lower layers of the power vertical can distribute financial and material resources and perform functions of social patronage, this (imperfect) mechanism of governing territories, enterprises, and organizations persists.
The use of the power vertical as a pillar of politico-economic order in Russia leads to a major increase in agency costs and to the aggravation of principal-agent problems within the hierarchy of governance.46 For instance, while in China these problems in the system of territorial governance are partially resolved via competition among subnational agents and their mutual policing (provincial Communist bosses can be promoted to the national leadership if and when they demonstrate excellent economic performance),47 but post-Soviet countries employ other solutions. Eugene Huskey labels them “the politics of redundancy.”48 In other words, parallel hierarchies in charge of control and monitoring emerge at various layers of the power vertical; presidential administrations exert political control over federal and regional governments, presidential representatives in federal districts do the same vis-à-vis governors and city mayors, and so forth. Numerous state agencies in charge of regulation and monitoring in various sectors of the economy, with their own territorial branches, are also used as tools of control. Very often, such a multiplicity of agencies (including those in the law enforcement apparatus) contributes to interagency rivalry: this, in turn, also aggravates principal-agent problems within the power vertical.49 At first sight, strict adherence to top-down hierarchical relations against the interests of the power vertical’s lower echelons should require the full-fledged threat of punishment of subordinated actors by the top leadership for virtually all instances of wrongdoing, misbehavior, and poor performance.50 But in fact, although the systematic use of state repressions against lower-level officials of the power vertical is rather widespread, it is often driven not by political demands from the Kremlin but rather by private interests of various actors from competing agencies and layers of the state hierarchy.51 The hierarchy of the power vertical is far from an army-like chain of command, and it operates according to a different logic.
The popular argument that the power vertical serves merely as a tool of subordination and control is rather incomplete and incorrect. The power vertical should be considered as a provider of informal selective incentives. The status of its insiders rewards them with extra benefits as they receive certain exclusive gains unavailable to those actors not included in the power vertical. The major condition for lower-level beneficiaries is that their opportunistic behavior should not prevent the political leadership from achieving its strategic policy goals. In the most general sense, these goals include the preservation of a stable politico-economic order in which the ruling groups run unchallenged and maintain the relative well-being of the population-at-large. Thanks to economic stability, the principal at the top of the power vertical pyramid can reward his agents through access to rents. Thus, corruption is not merely a side effect of bad governance but rather an indispensable part of the mechanism of bad governance within the framework of the power vertical.