Despite the unequivocal rejection of economic growth and development as policy goals of the Russian authorities in the 2020s,50 one should not infer that the post-Soviet technocratic model of policy-making has been exhausted. On the contrary, it seems that under conditions of bad governance, the technocratic model finds no alternatives in Russia. The key asset of post-Soviet technocrats is their (often high-quality) professional expertise, especially in complex and technically difficult areas such as tax policies51 or the banking sector,52 where political leaders cannot govern without reliance upon qualified professionals. In essence, politicians want to avoid major crises in the governance of their respective countries and seek foolproof approaches at least to the economy and finance. In addition, the participation of technocrats in informal ruling coalitions may increase the sustainability of regimes: it allows political leaders to use divide-and-rule tactics vis-à-vis their junior partners53 and reward successful technocrats who combine both loyalty and competence. The involvement of technocrats in policy decision-making is considered by economic agents (including international businesses) to be a possible barrier against the expropriation of their assets by rent-seeking bureaucrats and against arbitrary changes in the rules of the game. Thus, the promotion of reforms or even the maintenance of the status quo by technocrats serves the legitimation of the politico-economic order of bad governance and brings benefits to political leaders, and sometimes (but not always) to the technocrats themselves. At the same time, political leaders, who may be genuinely interested in policy success, can blame technocrats for undesired costs and unintended consequences of reforms, while positive results of policy changes may open up new opportunities for rent-seekers and increase the aggregate profits of the members of the informal ruling coalitions.54 Even the potential replacement of competent technocrats with loyal yet incompetent ones (if and when it occurs) does not mean inevitable revision of the technocratic model as such, even though the quality of policy-making may decrease, thus further aggravating numerous problems of bad governance. This is why one must turn from a normative critique of the technocratic model of policy-making to its positive analysis: how it really works and why its political and policy effects are so diverse and often contradictory.
Technocracy
at
Work: Policy Reforms
in
the
Crossfire
For policy reformers, there is seemingly no task more daunting than conducting major changes within the framework of the political model of policy-making. They face opposition from public opinion, the parliamentary opposition, social movements, media, and interest groups. One can imagine what might happen if major policy changes such as the introduction of the Unified State Exam (EGE)55 in Russia in the 2000s were advanced by a government politically accountable before a legislature elected via free and fair contest. In that event, an informal coalition of angry parents, dissatisfied educational bureaucrats, and teachers and rectors of most universities would not allow the reformist minister of education to propose the draft bill on the EGE to the parliament, and opposition parties could block the proposal during floor discussions and/or attempt to revise it after the next elections. At best, this reform would be protracted, postponed, and implemented in a different format than initially developed; at worst, it could be completely buried.
Within the framework of the technocratic model, the introduction of the EGE occurred under a completely different scenario. Anticipating huge resistance from opponents of the reform, the Ministry of Education co-opted them into the group in charge of developing the National Education Doctrine (a false target, initially proposed to generate clamor without any real policy impact). At the same time, it pursued a creeping introduction of the EGE under the label of an “experiment,” which set its scope to seven years. When the experiment became so widespread over the course of the 2000s that almost all school graduates were required to pass the EGE, the legal codification of this already adopted decision by the parliament become inevitable. However, the initial ideas, which proposed linking EGE results with the amount of state funding of university fees via individual state financial obligations (GIFO), were sacrificed along the way. The rejection of the GIFO was an element of the deal between technocratic reformers and members of the State Duma, in return for pledging loyalty to the EGE; in addition, the reformers themselves had little interest in introducing GIFO, it being a technically complicated venture.
At first sight, this policy outcome could be regarded as a success story for the technocratic reformers: using bureaucratic tricks and administrative maneuvering, they overcame the resistance of various interest groups and the mass public and implemented their project. Yet the EGE faced problems due to the inappropriate incentives of the subnational bureaucracy. EGE results in the regions counted toward evaluation of the performance of regional governors, thus tempting them to achieve better EGE numbers at any cost, including leakage of tests and blatant fraud.56 Later, however, evaluation rules were changed, and as EGE results became more or less objective, the exam’s introduction became irreversible. While the educational mobility of students increased, corruption in school exams declined, and university entrance exams were eliminated, major side effects became visible later. The content and meaning of the EGE degraded over time as the pressure of interest groups such as educational administrators and university managers resulted in fundamental changes. First, anonymous testing was gradually replaced by other mechanisms of evaluation oriented toward the subjective judgments of teachers and more vulnerable in terms of corruption. Second, EGE certificates, initially available for applications to various universities (such that the best school graduates could choose among them), were used for admission to only one college chosen by graduates.57 At the end of 2016, Olga Vasilyeva, then the minister of education, announced the plan that all Russian universities would regain the right to introduce extra entrance exams in addition to the EGE, thus greatly diminishing its value. Yet, this plan is not fully implemented, however. But since many Russians perceived the EGE negatively, and its legitimacy was and still dubious,58 the revision of the reform and the possible rejection of its achievements could be met with no serious resistance.
Which is a better solution in terms of policy outcomes? First, a long preparatory period for the reform, which involves public discussion, mutual adjustment of major stakeholders’ positions, step-by-step implementation and further embedding; or second, a quick imposition of the reform in the format of a secret operation, bypassing key actors and public opinion, followed by further revisions and ultimate emasculation? Answering these questions requires an in-depth analysis of policy changes in comparative perspective that lies beyond the scope of this book. But in the context of post-Soviet Russia, several policy reforms combined the worst features of the two options and involved appeasing and co-opting stakeholders on the one hand and privatizing gains and socializing losses on the other. In such cases, tactical selective appeasement of stakeholders may give rise to a strategy for policy change where buying the loyalty of veto players turns from a means to an end of technocratic reforms. In that event, not only will policy outcomes become imperfect, but the legitimacy of the reforms will come under question. The fate of large-scale privatization of state enterprises in Russia in the 1990s is instructive. Privatization was accompanied by co-opting former Soviet enterprise bosses, the so-called red directors, in exchange for their loyalty and the use of special conditions for privatizing the most attractive assets through loans-for-shares deals. This contributed to the transfer of property rights to a limited number of oligarchs closely linked with political leaders.59 Although in economic terms this reform was relatively successful and many privatized enterprises performed much better than state-owned companies,60 the legitimacy of privatization in Russia in the eyes of the mass public was much lower vis-à-vis some other post-Communist states. A large share of Russians endorsed en masse revision of privatization deals.61 No wonder that the counterreform promoted by the Russian state in the 2000s, namely the creeping nationalization of assets of privatized and private-owned enterprises (“business capture”),62 was deemed much more legitimate than privatization and reversed the reforms of the 1990s to a great degree. According to data from the Russian Federal Anti-Monopoly Service, by the end of 2016 the Russian state controlled more than 70 percent of all assets in the country’s economy.63