Khodorkovsky's Hamartia

‘Khodorkovsky was the only one of the oligarchs who forgot that he was an oligarch, that is, a crook. He decided that because he’d stopped stealing from the company that he was a great businessman, a builder of value! The other oligarchs, when they saw the fuzz, knew they should run. But Khodorkovsky forgot.’

That vivid distillation of Khodokovsky’s essence appears in Keith Gessen’s elegant and accurate essay published in the latest edition of the London Review of Books.

In his review of Richard Sakwa’s new book, Gessen, a native Russian who has covered the Politkovskaya trial for the New Yorker, gets to the bottom of Khodorkovky’s many paradoxes:

How could this ‘nice guy’, with his ‘gentle demeanour…simple, down-to-earth manners [and] roll-neck sweaters’, end up making a fortune by ‘nickel-and-diming the wealth of the nation’? By speculating on the inflation prone roubles invested into his bank by’ the Russian population for whom the price of bread went up while salaries and pensions stagnated’, and then scoop up priceless state assets at Black Friday rates?

How was it that, ‘as the “transition” to capitalism continued in the early 1990s, Khodorkovsky grew increasingly powerful without growing correspondingly obnoxious’, despite ‘some unlovely manoeuvres’, as when ‘a truckload of important financial documents happened to fall into the Dubna River’ or when he ‘threatened to dilute the value of Yukos shares down to zero if minority shareholders didn’t sell out to him at his price’?

And finally, after he had already been fingered by Putin’s goons, how could he have ‘refused to run…refused to sell out his friends…refused to back down’ in the face of an imminent downfall?

Reminding us that ‘a spirit of optimistic, strategic denial seems to have been at the core of Khodorkovsky’s project from the very start’, Gessen concludes that in the end, he simply ‘began… to believe his own press’.

But refreshingly, Gessen continues beyond the personal and to the structural. The 1990s were less a tale of individual human villainry than of a perverse system of rewards that led smart nice guys like Khodorkovsky to go terrible things.

‘Really, it’s the money’s fault’, he writes, and continues:

Loans-for-shares became the historical flashpoint for anger at the way the 1990s privatisation was conducted. But the deeper cause of this anger was the lawlessness that allowed a small group of people to become very wealthy while everyone else came to fear for their lives.

The most frustrating thing about Khodorkovsky is that he is not the killer that Putin’s men allege he is. But yet, all through the 90s, scores of people have died.

Writes Gessen:

‘Someone killed all those people, shot up their cars, and threw grenades inside just for good measure. Someone – or many people, acting separately – spilled a lot of blood during the 1990s, and we don’t know who it was.

While this was happening, someone also privatised Russia’s immense oil wealth, avoided taxes, thereby bankrupting the government, which, since it had to finance a war in Chechnya, and also the lifestyles of its own officials, cut back on hospitals, so that patients, when they arrived at those hospitals, were much more likely to die. It would certainly be simpler if the murderers and the privatisers were one and the same.

This is the line that Putin has taken.

While the Russian authorities like to compare Khodorkovsky to Al Capone, Gessen astutely chooses a much closer parallel: Bernie Madoff.

Here was another ambitious, clever man whose undoing stemmed largely from his own naivite and self-delusion, and whose exaggerated punishment -150 years- was also a very political one.

Both men embodied the essence of their age; far from being some sort of sick anomalies, they merely reached for the low hanging fruits available to those who best espouse the dominant values of the culture: in the case of 90s Russia and 2000s America – the culture of financial speculation.

In fact, the parallel to Madoff runs much deeper: at its core lie the values and rewards of a capitalist system that led those two men to do what they did, and the similarity between Obama and Putin’s approach to economic crimes and their redress.

Both governments used the high profile dressing down of a fall guy – Madoff/ Khodorkovsky – to obscure their unwillingness to address the deep structures that produced and nourished not only the bad guys in question, but also themselves.

For even as Khodorkovsky and Madoff languish in jail, Putin was brought into power and remains propped up by Khodorkovsky’s heirs (Prokhorov, Lisin, etc), while Obama has spent public trillions to preserve the same economic system that nurtured not only Madoff – but also his own finance-saturated presidency.

Perversely, Khodorkovsky and Madoff’s were guilty only of their success at the only game in town. And by blaming the (best) players, cynical Russian and American elites have adeptly avoided blaming the game itself.