Moscow’s authoritarian future
Recent moves against Moscow’s street traders don’t only violate Russia’s Constitution and hurt the economy. They also consolidate the regime’s power.
(opendemocracy.net – Anastasiya Ovsyannikova – March 9, 2016)
Anastasiya Ovsyannikova is an economist and journalist. She has worked for F5 and Cityboom.ru, as well as Moscow’s Sakharov Center.
The overnight demolition of 104 street kiosks in Moscow last month was terrifying. On 8 February, across the city, the city authorities pulled down buildings simultaneously with the assistance of the police. They didn’t even allow vendors to remove their goods. At several locations, municipal employees began to demolish buildings with traders still inside – these people had locked themselves inside to protect their businesses or place of work with their own bodies. In one video, you can watch as a crowd pleads with a police officer to get people out, even by force. As the bulldozer destroys the shop’s front door, the officer just shrugs his shoulders as if to say: “I’ve told them what’s going to happen, but they’re not coming out”.
The “Night of the long scoops” was a punishment operation -demonstrative and chilling. Fortunately, no one was hurt. But in the morning, when the sun came up, we were greeted with a terrible sight.
The Moscow authorities’ official position is as follows: first, the buildings were illegal constructions, built without permission, and second, the shops were erected in protected areas of transport and utilities infrastructure (and thus present certain risks). The head of the Moscow Metro Dmitry Pegov even went so far as to suggest the kiosks present a potential terrorist threat – after all, you could leave something dangerous in them.
Beyond the absurd argument of terrorism, it’s hard to judge the proposed risk. Perhaps it does exist somewhere. As the head of Moscow’s department of science, industrial policy and entrepreneurship put it: “the officials [involved] often didn’t know what was under the ground when they issued permission”.
But in this case, it’s the authorities that should pay the price and buy the buildings from their owners. Over the years that these kiosks have existed – and for some that’s 20 years or more – there have been no serious accidents. The kiosk owners themselves say that there’s one case where a kiosk is presented back-to-front on a planning document (and therefore infringing on some communications), and another where a gas line did run under some kiosks, but it hasn’t been there for a good 10 years or so.
Indeed, the legal side of this issue is unimaginable even by the standards of Russia today. The fact is that out of 104 buildings demolished, 43 of them had never been involved in any court disputes, and 41 of these 43 were officially registered as temporary buildings, some of them – permanent. Of the remaining 61 buildings, 42 court decisions were made in favour of the owners, and six cases are yet to receive decisions. In effect, there were legal grounds for demolishing a maximum of 15 of the 104 buildings.
But this didn’t stop the mayor’s office: on 8 December, the Moscow city government passed a decree, in which the decision on demolishing “illegal buildings” was taken by means of including it in the list of buildings to demolish.
The authorities cited Article 222 of Russia’s Civil Code, which regulates the legal status of “unauthorised constructions”. Amendments were made to this code relatively recently, at the end of June 2015. (The economist Boris L’vin tracked down and laid out their unbelievable fate here.)
This all started with a draft bill introduced by the government, which responded to the need to bring deals made in Crimea into accordance with the norms of Russian legislation.
There was no mention of Article 222 in this draft bill, and it was passed in the first reading. By the second reading, however, the bill had acquired a previously undiscussed amendment to Article 222. This amendment permits the demolition of “self-built structures” with the decision of municipal authorities, on an administrative basis and without the possibility of appeal to the court if the structure is located in “a zone with specific conditions of use […] or on the territory of general use or in an area of engineering networks of federal, regional or local importance.”
The Duma’s legal apparatus penned two responses to this amendment. The first was sharply critical, and indicated that the proposed amendment contradicts Russia’s Constitution, which states that no one can be deprived of the right to property other than by a court. The second was softer, but still negative.
What followed was quite strange: on the same dates, the apparatus issued other responses, which were no less authentic and signed by the same official, but now without any criticism of the amendment whatsoever. At the final plenary session of the Duma’s spring session, Pavel Krasheninnikov, the head of the legislative committee, made a short speech (literally, four phrases) in which he proposed to pass the amendment – which is what happened shortly after. No one knows where the amendment came from or who its author is.
And so, a huge number of court decisions in favour of the buildings owners and Russia’s Constitution ended up on one side of the scales, and on the other – a new legal norm that appeared out of nowhere and now had the status of a federal law, and mayor Sergei Sobyanin, who had declared the buildings “unauthorised” just because he could.
As Sobyanin wrote in his official account on Russian social network VKontakte: “You can’t hide behind property papers that have been acquired in an obviously fraudulent way.”
Sobyanin’s new city order
At the same time, Sobyanin declared that the demolished “illegal” buildings were “erected mostly in the 1990s with the blatant connivance or assistance of public officials.” However, there was no talk of bringing these officials to justice. Nor was there any discussion of accusing businessmen of acquiring the necessary permissions through corrupt means. The “1990s” is the key word here – a figure of silence, and full of clear hints.
A recent investigation by RBC, a leading Russian business reporting service, shows how the big management companies that built Moscow’s markets and kiosks in the 1990s, whether below or over ground, belonged to businessmen very closed connected to the administration of Yury Luzhkov, the city’s former mayor. At times, these people themselves had positions in the Moscow bureaucracy, and were close to “authorities” in the organised crime world. They leased trading areas to retail shops and street food.
In 2010, Sobyanin became mayor of Moscow and immediately began waging war against small-scale street trading. This war passed through several stages and was conducted in different ways: there were city plans for how to locate trading pitches, auctions on the right to lease spots to erect kiosks, and proposed models of kiosks, which they forced entrepreneurs to purchase, and a sharp increase in leasing costs.
As a result, of course, there have been several carve-ups of property, and each one involved an criminal authority of the 1990s being pushed out of the market. Since 2010, the total number of kiosks has dropped from 14,000 to 5,000. The “night of the long scoops” is just one of several links in a chain – and a highly theatrical one at that. Markets and metro kiosks (which the authorities intend to close in March 2016) have been shut down in a quieter fashion.
Although most of the remaining kiosks still belong to people once affiliated with Yury Luzhkov, the “night of the long scoops” didn’t only take aim at them. Journalists have collected evidence from other entrepreneurs targeted who have businesses at the Sokol and Kropotkinskaya metro stations, as well as other locations. Given the size of their businesses, it’s hard to call these people “oligarchs of the 1990s”.
And here’s an interesting detail that figures in many stories: the eviction orders were issued without signatures and stamps – you can’t take this document to court. (Recall Sobyanin’s phrase: “property papers that have been acquired in an obviously fraudulent way.”)
From 2015 onwards, independently and using their own funds, the Moscow authorities have begun to build kiosks that they then lease out. This is what they’re doing now. The Moscow government has already stated that new trade locations will be constructed with city money to replace those pulled down in the “night of the long scoops”.
Moreover, Moscow’s department of trade is planning to substitute all kiosks (the remaining 5,000) with its own by 2017. In other words, all property relating to small-scale street trading in the Russian capital will become state-owned.
Triumph of political will
Public discussion over the demolished buildings often comes round to the aesthetic argument. The kiosks and shops weren’t great to look at, people say. They distorted the city’s historical façade. In the social media post with that genuinely historic phrase about “property papers”, Sobyanin calls the demolition a “vivid example of how, in Russia, the truth, our heritage and the history of our country aren’t for sale.” “We’ll give Moscow back to the Muscovites. Its squares and streets. Open, beautiful and loved,” he writes.
Those who were pleased at the “night of the long scoops” didn’t only dislike how the kiosks looked: they also called them hives of unsanitary and criminal behaviour. Sergei Ivanov, head of the presidential administration, used the word gadyushnik, or “dive”.
To be fair, these kiosks were not architectural masterpieces. Several places, such as the square outside the Chistyprudy metro, were unpleasant due to the number of drunks that gathered there. But there’s the sanitary control department and the police to battle against problems with public hygiene and violations of public order. Besides, large gatherings of people (even if they’re not from high society) do not create, but reduce risks of serious street attacks: criminals love empty streets.
However, to present all of the destroyed buildings as suspicious and dirty kiosks where bad kebabs are sold is, to put it mildly, an exaggeration. Take a look at this photo gallery to make up your mind. The principal mass of buildings were completely reasonable kiosks, trade pavilions and even small shopping centres. They housed coffee chains, street food, florists and mobile phone shops, perfume counters and grocery shops and much else besides.
Indeed, these photos show how the space “freed” from trade doesn’t reveal the beauty of Moscow, but Soviet-era development. The example of the Pyramid shopping centre on Tverskaya is illustrative: it was pulled down two weeks after the other buildings, and now the eight-story cuboid building of the Izvestiya newspaper rises from behind in all its glory.
The main point is: when the mayor voices his concern for the history of Moscow, the city’s image, he is, at best, pulling our legs. Arkhnadzor, a civic movement dedicated to documenting and protecting Moscow’s architecture, has compiled a “Black book” of losses to Moscow’s architecture for 2010-2015. Over the past five years, Moscow has lost more than 90 historical structures, several of which even had protected status.
But it’s easy to believe that Sobyanin sincerely thinks he’s making Moscow beautiful with these bulldozers. Such are the Moscow authorities’ ideas about beauty: uniformity, single authority, monumentality, scale, a lot of empty space and no way through.
This is the spirit lurking behind the recently reconstructed Triumfalnaya Square, with its monstrous concrete swings that open out onto a view of Mayakovsky’s legs (a Soviet-era statue to the poet stands opposite); and the new pedestrian zones, covered in slabs, which are, in winter, become covered in smooth and slippery ice glaze. Thus, on a day of terrible ice, instead of the usual 10, 200 people went for medical aid after breaking their arms and legs on the new pavement.
In Moscow, there’s a new fashion to cut all the grass that grows on ground as yet not covered in concrete, and to pack up autumn’s fallen leaves into big black bags and take them off to the incinerator. Both of these practices, cry the ecologists, harm a city environment that is already lean and bare. But then, this is order – one fit for an army parade ground. It’s quiet, too: the street musicians have also gone.
It’s impossible to resist the desire to interpret the tastes of the city administration – and we shouldn’t. Popular lore puts this down to Sobyanin’s provincial background: earlier in his career, Sobyanin was mayor of Kogalym, an oil-town in the Khanty-Mansiisk autonomous territory. People called him the “deerherd” (in reference to a traditional Khanty occupation). Some people consider this nickname racist, others merely believe that Sobyanin manages Moscow as if it’s an empty tundra.
And there’s some truth to that. Not in the tundra, but in the emptiness. Moscow’s new urbanism refuses to adapt to the individual. Instead, it insists that the individual adapt to it. The prospect of buying a bottle of water in summertime has long been a difficult task, and now it’ll be impossible near the metro too.
Two years ago, Aleksei Nemeriuk, head of Moscow’s Department of Trade, announced that Moscow doesn’t need street food: it’s in demand, sure, but “whatever you give people, they’ll take it”. Instead, Nemeriuk made a promise: “We’re getting rid of this format. In Moscow, cafes and restaurants have started to actively develop – in principle, that’s enough for us. Street food will gradually begin to disappear. We’re living in the capital of a great country, after all,” It turns out he wasn’t joking.
Now Nemeriuk says: “We’re looking to have the number of kiosks that Moscow had in the Soviet era. Back then there was ‘Newspapers ‘, ‘Ice cream’, ‘Theatre tickets’, and there was enough for everyone.”
The authorities are clearly taking on the function of disciplining the individual body, burning out with a hot poker – rather, crushing with a bulldozer – everything that is unordered, independent, spontaneous and unsterile. Everything that is alive in our city. Even when it’s “hiding behind property papers”.
This picture of the world, in which the law and private interests don’t matter if they’re ugly, and should give way to the grandeur of emptiness and concrete, is a totalitarian one.
It goes without saying that the “tragedy” of the 104 trade kiosks is a drop in the ocean. Several thousand jobs have been lost, and the budget, according to business association Delovaya Rossiya, will lose two billion roubles (£19.4m) in taxes.
But the story of Moscow’s kiosks is reminiscent of two other recent developments – the introduction of paid parking in Moscow and the protests of long-distance truck drivers against fees for driving on highways.
At the end of 2012, the Moscow authorities began to introduce paid parking in the centre of town, citing a need to bring down the level of traffic on city streets. Gradually, the zone of paid parking expanded, and now it incorporates many city neighbourhoods (this includes parking at night, and local residents are charged at a discount rate).
The paid parking scheme has elicited a lot of discontent, and not only because it is basically a tribute taken from car owners. (It seems there won’t be any free parking in the future.) But due to bureaucratic complications in issuing residency permits, as well as numerous technical breakdowns with the payment system, people are being issued large and unjustified fines.
But this project is particularly interesting because it’s loss-making for the city coffers: according to an investigation by Vedomosti, the authorities have taken 5.8 billion roubles (£57m) from drivers over three years, and the city’s budget expenses were, in total, 16 billion roubles (£157m). Aleksei Navalny, head of the Anti-Corruption Foundation, has accused the public officials who launched the parking system of corruption when the construction contracts were put out to tender.
Given the story with paid parking, it’s hard to be sure that the state’s takeover of street trading will bring additional funds into Moscow’s budget. When will these state kiosks actually be built? How much will they cost? Given that the economic crisis hits small business hardest, will the authorities manage to lease them out at a profitable rate? And most pressing: will the rent go straight into the city budget or will a murky managing company come along and swallow up all the cash as usual?
For instance, a company like RT-Invest, which operates the payment system for the new fees truckers have to pay. The Russian government has decided that heavyweight goods vehicles are damaging the roads and should therefore pay compensation (in addition to the pre-existing transport tax and fuel duty).
This is why the government has introduced payment for travelling on federal highways. In November 2015, truck drivers were obliged to register with the Platon system, which calculates payments per distance traveled at 3.73 roubles (£0.03) per kilometer. Draconian fines were also introduced – up to one million roubles (£9,800) from an organisation, and 50,000 roubles (£490) from an individual. This led to mass protest actions, with drivers merging into columns and moving at snail-speed, blocking traffic on their way to Moscow and St Petersburg, where small protest camps remain.
The peak of such actions, at least so far, has passed. The protesters managed to get a sharp decrease in the tariffs and, most importantly, the fines. But there’s alleged corruption here, too: 50% of RT-Invest belongs to Igor Rotenberg, the son of Arkady Rotenberg, a businessman close to Vladimir Putin.
Moreover, according to documents in the possession of Aleksei Navalny, RT-Invest is receiving 10.6 billion roubles (£103.9m) from the government, and paying nothing in return. Russia’s Federal Road Agency has stated that the text published by Navalny is a draft, but did not present its own version. At the end of January 2016, Moscow’s arbitration court ordered RT-Invest to hand over the real text of the agreement to Navalny, but is yet to do so.
The scale of the truckers’ protest is easily explained. According to St Petersburg website Fontanka, there are 1.88m heavy-goods vehicles registered in Russia, with 1.14m owners. Russia’s goods transport is, in effect, very small business or a form of self-employment. The introduction of fees for using roads leads to transport costs rising by 10-20% and, obviously, a shrink in the market – that is, some people will lose their main source of income.
Thus Moscow’s small traders and their employees find themselves in a similar situation to the truckers. But in contrast to the truckers, united in their “male solidarity born on the road”, the traders are unlikely to come out in protest.
The burden of Russia’s economic crisis rests heaviest on these people. On the one hand, the goods market is shrinking (if Russia’s economy contracted by 3.7% as a whole in 2015, then retail collapsed by 10%). On the other, they are now facing confiscation measures – both literally during the “night of the long scoops” and figuratively with the new road tax. If they can’t remain afloat, these people now have two routes of retreat: the informal or the state sector.
In 2013, the Khamovniki foundation carried out a study “Seasonal workers in Russia’s small towns”, which found that up to 20m people in Russia are employed in seasonal work outside their place of permanent residence. Simon Kordonsky, the sociologist in charge of the research, talked of Russia’s “garage economy” in which, for example, 30% of people living in the city of Ulyanovsk are involved. “Everything is made in garages,” Kordonsky said, “spare parts for foreign cars, doors, window frames, dumplings, vodka.”
This employment in the shadow economy naturally exists outside legal regulation, taxes, social guarantees and so on. And while it is completely independent of the state and incredibly mobile, it is extremely vulnerable, particularly in a police state. It is not surprising that people employed in the informal sector are politically and socially inactive: they wish to have as little contact with the authorities as possible.
Meanwhile, the public sector in Russia is colossal, and still growing. According to the IMF, in 2014 the public sector’s share of GDP exceeded 70%, and according to RBC, it made up to 30% of employment, putting Russia fifth in the world in terms of public sector employment. (You can’t compare these numbers directly because of possible differences in methodology and definition of public sector, but they give a sense of scale.)
If we take official data on the adult population of Russia for the end of 2014 (119m people) and the number of people employed in the economy (71.5m people), then a quick calculation gives us the following and very rough result: for 58% of Russia’s voting-age population, workers and pensioners, the main source of income is the state.
The more people shift from the private into informal employment or state institutions and companies, the greater the support for the authorities. Even when the patriotic mood fades (and it will), and people start to badmouth the (highest) leadership in their kitchens, this dissent won’t go any further than the kitchens.
Political action is fraught with consequences for both the informal sector and the public sector. This is why these people won’t go out to demonstrations, and they’ll continue to vote as ordered – or not vote at all.
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