the Voice of
The Communist League of Revolutionary Workers–Internationalist
“The emancipation of the working class will only be achieved by the working class itself.”
— Karl Marx
Sep 11, 2023
The following article is a translation of an article first appearing in Lutte de Class, #234, September-October 2023. LdC is the political magazine of the French revolutionary Trotskyist organization, Lutte Ouvrière.
This summer’s rebellion by Prigozhin and his mercenaries, and the circumstances surrounding it, bear witness to the fact that the Kremlin’s “special military intervention” in Ukraine has not only put Russia’s economic, human and military capabilities to the test, but the regime itself. It also revealed widening fractures in the regime’s very foundation: the more or less coerced alliance between the Russian bureaucracy, a distant heir of the Stalinist bureaucracy, and a layer of wealthy businessmen in their post-Soviet version, the oligarchs. This bourgeois stratum, descended from the bureaucracy, has prospered under its wing even as it increasingly integrated itself into world markets. They are now more or less openly demanding to be spared the repercussions of the Kremlin’s policies. Western sanctions have affected the oligarchs’ business interests, as well as their personal interests, blocking their assets and accounts in Europe and America, prohibiting them from traveling and enjoying their yachts, villas, etc., abroad. Some have taken their case to the American courts, arguing that they had no involvement in Putin’s war. This is in line with the anti-war stance taken by other oligarchs, and with their more general aspiration to free themselves from the tutelage of the bureaucracy and its system, if not to emancipate themselves from it.
Like other wars before it, the war in Ukraine acts as a catalyst for social tensions and, ultimately, as a gas pedal on the class struggle. The war concerns not only bureaucracy-oligarchy relations but also, as we shall see, the worsening situation of the working classes as a result of Kremlin policy.
Ever since the Russian army invaded Ukraine on February 22, 2022, the strategists of the imperialist powers have kept repeating that the war ravaging Ukraine is destined to last. And they are doing their utmost to make sure it does, delivering ever more weapons to Kiev, while the war has increasingly visible effects in Russia.
Although the leaders of both sides make their losses a state secret, Russia and Ukraine are said to share an equal part of the bloody death toll of 500,000 civilians and soldiers, according to the U.N. Deputy Secretary General. For Russia, it’s no longer just a question of civilians mobilized en masse and “volunteers” recruited from the poor in deprived regions or from prisons, as was the case at the start of the conflict. Almost every day, Ukrainian drones strike Russian provinces on the border, if not further from the front. Added to this are all the civilian victims in the four oblasts in the south and east of Ukraine, annexed by Russia in 2022, as Crimea was in 2014.
So the half-million dead and wounded announced by the U.N. will soon be exceeded. This war that some commentators call “a war of attrition” is—to put it more bluntly—devouring more and more human beings and destroying everything necessary for the life of society.
NATO doesn’t fight with tanks and missiles alone, but with propaganda spouted through Western media. Putin has acknowledged that Western sanctions are taking their toll on the Russian economy. This has led some in the Western media to claim that Russia is so exhausted that it is forced to ask North Korea for weapons. Similarly, the media presents Ukraine as necessarily democratic simply because it is pro-Western. In fact, Zelensky’s regime is just as corrupt as Putin’s, just as vicious in attacking the basic rights of workers and national minorities on its soil.
Western media remain silent on the real causes of this war: the imperialist states’ continual 30-year drive to push Russia out of its old zone of influence in Europe, and that includes out of Ukraine. Western governments have made the Ukrainian state a pawn of their policy, and turned its population into the armed wing and victims of their policy.
The leaders of the Russian camp and those of Ukraine, along with their Western sponsors, seem to fear that the dramatic consequences for the populations of a conflict settling in over time will eventually lead people to end their passive acceptance of this war and those who are responsible for it. This explains Zelensky’s highly visible preventative measures—his repeated purges within the Ukraine state apparatus, which is made up of predators attempting to enrich themselves even faster in war than in peacetime. Will Zelensky’s purges make the population be ready to go on giving up their lives for the sake of people who accumulate fortunes, sheltered far from the front line? Not at all sure.
In Russia, Putin also played the same game. But, since the Wagner rebellion, he has had to navigate between competing poles. He cannot ignore the muted discontent of the masses about the massive conscription of soldiers and the human and social cost of war in general; he cannot alienate the military hierarchy, which the Prigozhin affair showed was not, or no longer, so unanimously behind the Kremlin; and, most seriously for the head of the Russian bureaucracy, he has to deal with the state apparatus, which seems to be torn between clans, perhaps wanting policies other than those of the Kremlin. In 1999–2002, Putin built his power on personal popularity, having re-established a certain stability, restoring the “vertical of power,” after the decade of chaos in and disintegration of the state following the end of the USSR. The current period threatens to jeopardize not only the image he created, but also the regime’s very stability.
In Russia on the eve of the war, 60% of the wealth was owned by only one percent of the population. The war has further increased this social injustice. The latest publication of bank balance sheets shows it. There is a yawning gap between the sectors that operate on behalf of the wealthiest and those that provide loans to the largest number of people, ranging from the petty bourgeois able to buy a home to workers struggling to make ends meet.
The Central Bank has described Russian bank profits for the first half of the year as an “absolute record”: 1.7 trillion rubles! But the business daily Kommersant noted that, while foreign exchange transactions boosted by capital flight were behind this success, the volume of loans to individuals plummeted, and with it the results of the major credit institutions, Alpha-Bank, and VTB.
In its own way, this contrast reflects the class opposition between the fortunes of the well-to-do and those of working people. The latter are less and less able to obtain credit, even for everyday consumption. On the other hand, companies, their owners, and high-ranking bureaucrats have sheltered the part of their wealth that had been in Russia, converting it into dollars or taking it out of the country with the help of certain Russian banks that have taken advantage of the situation.
This is certainly nothing new, but let’s note once again that a large part of the value created in the country, the product of the exploitation of the working class, is not used to develop the Russian economy, even though it claims to be open to the market. Instead, this surplus flows into the global circuits of capital, feeding the profits of the financial sector of the imperialist states and their tax havens.
Officially, capital flight quadrupled between the summer of 2021 and the summer of 2022, reaching 253 billion dollars, or 13% of Russia’s Gross Domestic Product. Media reports compare it to what happened in the 1990s, and again in 2008 with the latest global financial crisis. But this time, the financial effect of Western companies departing has been added into the mix, even if this is intended to be temporary, and even if more than half of the multinationals operating in Russia, not only American but also French and German, have no intention of leaving. For them, war or not, profits come first.
Massive capital flight and Western sanctions have caused inflation to soar and the ruble to plunge. Since January, it has lost almost 30% against the dollar and the euro, driving up the prices on imported goods, as well as on locally-produced essentials, for which the popular classes are already paying the price.
The published report of Putin’s meeting with the head of the Federal Debt Collection Service gives a concrete idea of the growing impoverishment. Thirteen million of the 140 million Russians can no longer pay their debts. Adding up consumer credit, fines, taxes, housing costs ... it comes to 20 billion dollars in accumulated debts. This represents only 8% of all the money the rich and super-rich have taken out of the country in a year, yet Putin declared that the population’s debts cannot be forgiven, because “the economy would collapse.” To avoid this, the head of the debt collection service admits that “there’s practically nothing to take from these people.” But, he says, “we’re trying anyway....” This makes it abundantly clear what the poor have been reduced to, and the methods the owners and rulers use against them.
Strikes have broken out here and there recently: for higher wages in the Moscow metro, among healthcare workers in Novokuznetsk. But more often than not, it’s because of the non-payment of a month’s wages, a practice from the 1990s that is now being revived, against a backdrop of slowed or interrupted production in factories deprived of supplies and technology from the West, or due to the disengagement of Western firms, as in the automotive industry. However, the authorities are cautious when strikes occur in regions where they involve a major sector of local activity. Especially if there is a tradition of workers’ reactions that could consolidate popular discontent. At the end of August, authorities tried to avoid this in Kuzbass, Siberia’s main coal basin. The deputy governor of the Kemerovo region promised the strikers from three closing mining companies that the state would pay their back wages. But, he advised them that they should perhaps look for another job.
For a long time, the Russian state managed to prevent companies from experiencing a labor shortage, which would have pushed up wages and thus production costs. But the risk of labor shortages has increased as the population continues to shrink, for social reasons (repeated crises, lower living standards, falling birth rates and rising death rates, fears for the future causing young graduates to flee abroad) and demographic reasons (retirement of the baby-boom generation). In response, Russia turned to its former Soviet republics. From its “near abroad” came Tajiks to work in construction and the markets, Uzbeks in the service sector, Ukrainians and Moldovans everywhere.
This economically vital workforce found low wages in Russia, but higher than at home, enabling them to send money home. However, with the erosion of the ruble’s value and its subsequent fall, even against the somoni (Tajikistan’s currency), a Tajik worker can no longer buy 300 dollars with part of his 60,000 ruble wages to send home to his family, but only half as much. As a result, between 2019 and 2022, the number of workers from the former USSR fell by 15%, and all signs are that this trend is set to get bigger.
The economy is therefore going to be short of millions of arms and brains—especially since the army has called up hundreds of thousands of men from the workforce in industry, transport and commerce, leaving behind virtually only women in the workforce. Some workers joined the army against their will, others signed a contract—not always respected, hence the sometimes collective protests—promising pay three times higher than their wages. And a million men have disappeared from the work force, having fled Russia to escape mobilization. Most of them are skilled, trained young people, engineers and computer specialists, whom companies are unable to replace. And, as the war intensifies, it simply exacerbates this situation.
To replace the armored vehicles, helicopters and cannons destroyed en masse in Ukraine, even just to produce the shells and bullets the army needs, the factories in the military sector have to run at full capacity. According to former Prime Minister and Deputy Chairman of the Security Council, Dmitry Medvedev, from now on “the assembly lines will operate on 3 shifts, eight hours a day, so the military-industrial complex can produce as many weapons as necessary.”
Russia has the means, inherited from the system of the former Soviet Union, to produce these armaments thanks to its military-industrial complex (the VPK), a high-performance, highly concentrated public and parapublic network of factories. What’s more, the Russian state has redirected a colossal share of its budget to the VPK. But the arms industries don’t run themselves. Before the war, they employed 2.5 to 3 million workers. With the war and the famous 3 x 8s, they probably need twice as many.
To find them, job search services are full of tempting advertisements. For example, one factory is offering 100,000 rubles for a shell fitter, even one with no experience or training—a worker’s wage previously reserved only for Moscow or St. Petersburg. The need is such that companies are offering to pay for training, relocation and accommodation for those who come from elsewhere, even far from the major centers, as long as they come to assemble shells.
As in any war, with the armaments sector attracting labor with its guaranteed jobs, and as it monopolizes a growing share of the budget, this can only be to the detriment of the rest of the economy. In Russia, the militarization of society is disrupting established economic circuits. The managers of other sectors and factories, whose production directly concerns the needs of the population, complain about it. They say there are staff shortages in all the professions. Some point out that such shortages in the agricultural/food sector will result in disruptions to the supply for the population.
To ward this off, at least for a while, and prevent the population from saying that it lacks everything when the war industry lacks nothing, the authorities will probably resort to imports. But with the outflow of foreign currency that this implies, the ruble will continue to weaken and inflation to swell. This will cost ordinary people, pensioners and workers dearly.
Putin and the other leaders of the bureaucracy, who claim to defend the interests of the “Russian people,” can offer them only guns, if not coffins, instead of butter. They are waging war, on both the Ukrainian and domestic fronts, against the working classes of Russia—and of Ukraine.
At the end of June, Wagner’s rebellion mobilized 25,000 mercenaries, a trivial figure compared to the 1.15 million men of the regular army. And those paramilitaries played only a marginal role in the Kremlin’s war machinery. Could this mini-putsch, which aborted after 48 hours, have involved sections of the army? In any case, it did not. Nevertheless, it worried the Kremlin enough for Putin to be stowed for protection’s sake in faraway Valdai, and for ministers to flee the capital, where security forces had erected barricades.
The Russian army didn’t follow Wagner; even less so did the National Guard, the large, over-armed separate corps that Putin had created to maintain order in the country. But it is a fact that, as Prigozhin’s convoy of armored vehicles made its way toward Moscow, it was able to occupy major cities without a blow. It is also notable that senior officers did not give the order to stop Wagner, remaining silent during the putsch, with the exception of one general who had just been arrested for sympathizing with Prigozhin, and who was forced to urge him to surrender in front of the TV cameras. Given the sidelining and arrests that followed, it seems that he was not the only one in the army’s upper echelons to share some or all of Prigozhin’s accusations about sabotaging the war, betraying the fatherland and using soldiers as cannon fodder—accusations that Prigozhin had been hurling at the Defense Minister and Chief of Staff for weeks. These accusations eventually touched Putin himself. Sectors of the upper civilian bureaucracy may well have identified with them. For months, ultra-nationalist, war-mongering right-wingers everywhere had been echoing Prigozhin with impunity.
It’s worth recalling the links this thug had forged with Putin in the early 1990s, when bureaucrats, mafiosi and KGB members were busy cutting the country to shreds. He rose to prominence with the man who became president at the end of 1999, and who gave him carte blanche to put his mercenaries to work for the Russian state: in Syria to rescue the dictator el-Assad; in Africa to help the putschists seeking to emancipate themselves from Françafrique; in Bakhmout where, at the cost of thousands of Russian and Ukrainian deaths, Prigozhin offered Putin a victory the likes of which he hadn’t had since the capture of Marioupol. And let’s not forget that the Kremlin had authorized him to recruit thousands of “voluntary” prison inmates to fill the ranks of his army in Ukraine.
All this had propelled Wagner’s boss into the limelight. Did he feel so untouchable that he risked going after Putin’s appointed civilian and military chiefs, even naming them? In any case, their long-standing ties didn’t stop Putin from denouncing him as a traitor. And this carried with it a death sentence. Just two months later, Prigozhin and his lieutenants were liquidated in the explosion of their plane.
Settling the score with Prigozhin may have served as a warning to those at the top who might be tempted by such an adventure, but it in no way resolved the underlying problem: the crisis of the regime that the putsch brought to light. Whatever Prigozhin’s real aim, which he denied was to target Putin, he was challenging those who run Russia, and therefore threatening the regime. This could have called into question the durability of a system that ensures the domination and privileges of millions of bureaucrats, a hundred or so billionaires, the oligarchs, and tens of thousands of lesser bourgeois, right up to the very existence of the Russian state. This state, such as it is, remains the guarantor of world order in a vast region of Eurasia, a world order the imperialist powers, led by the United States, apparently do not want disrupted, at least not in the present stage of militarization of the world. If Russia were to break up into entities pitted against each other, that order would be disrupted, and in fact this is what began to happen with the implosion of the USSR, and then in Yeltsin’s Russia. It’s what would happen if the Russian state were to weaken so much that it no longer had the capacity to enforce order against its own peoples—as it did, a month before the war in Ukraine, against the proletariat of Kazakhstan, saving the interests of local bureaucrats and the oil trusts.
The U.S. government, which is no stranger to declarations against “Putin and his war,” has refrained from commenting on this rebellion. Time will tell what’s coming.
Mikhail Khodorkovsky, the oligarch who was sentenced to ten years’ imprisonment and forfeiture of “his” oil empire for wanting to dispose of it without consulting Putin, now lives more than comfortably in London. It was from there, during the putsch, that he called on Russians to “help” Wagner’s leader, explaining that this could help get rid of Putin, if not his regime. He also made it clear that the next step would be to get rid of the “criminal” Prigozhin.
Although this gentleman may not, as he presents himself, be a spokesman for the pro-Western opposition to Putin, his positions in favor of the establishment of Western-style capitalism are common knowledge. And, coming from the country’s most powerful former oligarch, his comments resonate with the attitude of many Russian billionaires since the start of the war. At the very outset, several, including high-profile oligarchs such as Deripaska and Fridman, clearly declared their opposition to the war. Others, such as Abramovitch, refused to openly support it. In protest, six other oligarchs publicly renounced their Russian citizenship, rightly judging it safer to seek shelter abroad. Indeed, the media have taken great pleasure in listing all the cases (some thirty) of “Russian sudden death syndrome” that have befallen Russian businessmen and senior officials who, having disapproved or criticized this war, had the foolish idea of jumping from the 15th floor of a hotel or “committing suicide” at home. A former member of the Yeltsin and Putin teams, interviewed by Le Monde, commented: “No one in the business world supports this madness. But the risk is too great to speak out.”
The real risk for Putin and his regime is that such a situation could undermine the pact he had made with the oligarchs when he came to power: “Don’t worry about politics, pay your taxes, the state will protect your business.” All but Khodorkovsky respected this pact, and willy-nilly, it was on this foundation that the world of Russian-style capitalists had prospered, if not in symbiosis, then at least in close collaboration with the high bureaucracy.
This agreement ensured a certain degree of prosperity for both parties, and stability for the regime as a whole, but this was in peacetime. The war, to which the Kremlin was forced by pressure from the imperialist powers, has reshuffled the cards. The oligarchs, at least some of them, can no longer get away with it: they can no longer lead the lifestyle of great capitalists between New York, London, the Côte d’Azur, the Courchevel sky resort. Some of their assets have been frozen; the business of their groups in Russia has often lost its luster; the number of Russian billionaires and their average financial size have, for the first time, fallen down the list of the world’s hit parade of fortunes.
For the moment, their discontent can’t find the people or the forces on which it can rest. But given the interweaving of the interests of the bureaucrats and those of the new Russian bourgeoisie, it could be that discontent is also spreading to sectors of that bureaucracy of which Putin has been in charge for almost a quarter of a century. Those sectors could make common cause with the oligarchs, with the aim of establishing a capitalist regime that Navalny, a hero of Russia’s small and middle bourgeoisie, describes as “clean and honest, with no thieving civil servants.”
We’re not there yet, and the law virtually guarantees that Putin will remain president for life. But the social basis of his power must not crack any further, and the tensions generated by the war are pushing in that direction. A crisis in the regime is brewing, and the war is bringing it to fruition. At the same time, it is crucial for Putin and his followers that they should be able to put up a united front with the country’s wealthy and privileged against the working classes. That is especially so if the war, by worsening the masses’ lot, leads them to fight their oppressors.