Sacred Capitalism Hits Russia

In the age of enlightened capitalism when the free market and neo-liberal doctrine spread like wildfire it is difficult to imagine an alternative to the aggressive and often destructive policies of unrestricted development and privatization that have dominated reform in many post-Communist countries. For many policy advisors and economists the market itself and its healing powers have become a kind of God.

Of course it’s not enough to declare one’s faith in capitalism without saying something about democracy. Thus it is always declared that the free market, private property, and so on will “nurture democracy.” The phrase “nurture democracy” is so vague it would be better off in a brochure detailing how to establish dynamic, egalitarian relations in the corporate workplace, how to nurture an efficient, profitable enterprise. Democracy as an infant however, and capitalism as the commanding father who will rear the unformed child into a glorious product of human achievement, is a metaphor economists seem to like.

Anders Aslund, director of the Carnegie Endowment for International Peace’s Russian and Eurasian program, in a recent column in the St. Petersburg Times, argues that property rights and more broadly free market reform nurture democracy. He even goes so far as to anoint private property with the distinction of a religious rite or symbol.

Aslund writes that, “The essence of successful capitalism is to accept existing property rights and declare them sacrosanct–no matter how they arose in the first place.”

Sacrosanct according to Webster’s online dictionary comes from the Latin sacrosanctus and means most sacred or holy, inviolable. It can also refer to something immune from criticism or violation. I would venture that Aslund is borrowing from both meanings of the word. Private property should be revered and its formation, how it came to be and who possesses it, left unquestioned.

But private ownership, whether of an urban dwelling or a former collective farm, is not simply an economic arrangement. It is predicated on structural change and on new relationships between owners and renters or workers. It means thinking of land in a different way and how one relates to it. Thus to cry out that private property rights should be declared sacrosanct regardless of how they come to be is a shortsighted and unsophisticated examination of a complex process. There are different ways to privatize and there are even alternatives to western conceptions of private ownership.

What if the majority of a nation’s farmland, for example, is consolidated in the hands of two or three wealthy men or a handful of corporations? According to Marshall Goldman this is not an idle concern. In The Piratization of Russia he writes that, “Several oligarchsâ¤|have already put together massive holdings of leased land that they expect to purchase.”

This is indeed the global trend even if it has not yet overwhelmed Russia. In a report in the Guardian John Vidal points to the worldwide consolidation of agricultural land and its impact on consumers, the environment, and economy.
He writes, ” It’s the same story across all developed countries. In the OECD (the world’s 30 richest countries), the number of farms has been declining by roughly 1.5% a year, and farmers and their workers now make up only 8% of the labour force. Some 15 million people have left farming in France, Germany, Belgium, Luxembourg and Italy since 1957. In the US, the number of farms has shrunk from 6.5m in 1935 to under 2m today. As the number of farms falls, so the size of those left grows.”

The question at this point is not whether Russia’s land will be put on the market and sold but who will have the power to purchase it and if its sale will be regulated. And also if Russia will follow the pattern of other developed nations crowding out its small farmers in favor of a few agrogiants capable of competing on the world market.

Many Russians continue to farm small plots of land. Even part time farming by urban dwellers makes up 2 to 2.5 percent of total agricultural land use. According to Yamamura Rihito, a Japanese sociologist, “The bulk of vegetables and potatoes are now produced in various types of small plots owned by villagers and city dwellers.” This is significant and suggests that the question of how to privatize the rest of Russia’s land should be given due consideration and not just understood in terms of a single, universal outcome.

Whether part time farmers or peasant farmers will be able to hold on to their farmland is unclear. If one takes the Anders Aslund approach it simply doesn’t matter what happens to those who exist on the margins without the resources or information to “build capitalism,” or the means to defend themselves against the powerful businessmen and corporations eyeing Russia’s farmland.

On a former collective farm in Russia’s black earth region that has fared comparatively well in the post-Soviet era the director confessed to a researcher that, “I could have made all of it into my own property, but to do it one must have no conscience at all.” Perhaps soon he will understand the sanctity of private property and have no second thoughts about making it all his own.

ADAM FEDERMAN can be reached at:



Adam Federman is a contributing editor at Earth Island Journal.He is the recipient of a Polk Grant for Investigative Reporting, a Middlebury Fellowship in Environmental Journalism, and a Russia Fulbright Fellowship. You can find more of his work at