Vladimir Shlapentokh

Январь 26, 2010

The Universal Offensive of Financial Feudalism in the Contemporary World: From Russia to the U.S.A.

Filed under: Uncategorized — shlapentokh @ 3:46 пп

The Universal Offensive of Financial Feudalism in the Contemporary World: From Russia to the U.S.A.
By: Vladimir Shlapentokh

In his recent article, “Velvet Revolution: The Prospects” (The New York Review of Books, December 3, 2009) Timothy Garton Ash muses about the regime changes that occurred throughout a variety of countries. He tries to distinguish the differences between two types of revolutions: the class revolutions — or CR — which were violent in nature, and encompass revolutions such as those that occurred during 1789, the Russian Revolution of 1917, and the Mao’s Chinese Revolution of 1949. The second category of revolution, the Velvet Revolutions — or VR — share the same characteristics as those that occurred in Czechoslovakia in 1989, Ukraine in 2003, and in Russia in 1991. While Ash devoted his articles only to the countries which experienced VRs, his piece reveals eye-opening global trends in post-Communist countries which are quite salient.
For reasons unknown, the Russian anti-Communist revolution primed by perestroika was not mentioned by Ash even though the developments in Moscow during 1991 fit perfectly into Ash’s definition of the Velvet Revolutions. Is Yeltsin so different from Voji-slav Kostunica from Serbia, or Viktor Yushchenko from Ukraine, who were both VR leaders mentioned by Ash? This “discrimination” of Russia (though Burma and Iran were not ignored in his discussion) is particularly amusing because Ash began his list of VR countries with three Baltic republics that had regime changes at the same time as Russia. It is also remarkable that Ash’s analysis of VRs in East Europe completely overlooked the crucial impact of Gorbachev’s perestroika and Moscow’s refusal to use its own forces, or the aid of the satellite governments, to crush the rebellion, which was also the case in Hungary in 1956 and in Czechoslovakia in 1968.
In his article, Ash tries to construct a Velvet Revolution model by demarcating several of its elements, which he compared to the class and violent revolutions of the past. Of course, this model encompassed not only “the giddy days” of the revolution, but also the following period when the revolution led to the creation of a new social order. Indeed, several of his observations are valid and reasonable. However, it is in my opinion that Ash does not pay due attention to two crucial elements of the Velvet Revolution and of the processes which they immediately engender: the role of property in its liquid or non liquid forms, and the omnipresent corruption. It is remarkable that even in such an involved article, Ash only briefly refers this issue surrounding property in a single sentence regarding “the privatization of nomenclature,” and talks even less about the role that corruption plays in the VRs, refusing to elaborate on the enormous political and social consequences of new property relations and corruption in Velvet Revolution countries.

Property and Class Revolutions
Ash sticks to the idea that the three CRs of the past were moved by utopian ideology while VRs were engendered by an anti-utopian program. In fact, this distinction is essentially wrong. The Russian and Chinese leaders of the CRs that were mentioned by Ash, and which were often labeled as “utopian” by Russian authors like Alexander Nekrich and Mikhail Heller, as well as by Americans like Martin Malia, aimed for the creation of a very realistic and well functioning society and achieved their goals. In support of Ash’s position, Malia asserted in 1994 that the Soviet Union was a utopian construction built like a house of cards by dreamers and lunatics, and referred to Athe fantastic and surreal Soviet experience,@ he depicted the Soviet society as: Awrong from the start,@ Aa social theater of absurdity,@ Agrim mistake of Columbus,@ and Athe greatest triumph of ideology over real life.@ However, as a result of the revolution, the Soviet Union and the Chinese People’s Republic emerged as powerful states whose ideology effectively combined nationalist and socialist (or statist, or authoritarian ) principles. By 1985, the Soviet Union with all its chronic diseases was another superpower whose society would have continued to vex the world had perestroika, with the intentions to cure these diseases, had not happened. Communist China, which still celebrates Mao’s “utopian” revolution every year on October 1, is currently prospering, and has the ambition to become another superpower in the near future. Even the French Revolution could hardly be named a utopian enterprise because it managed to seriously change society, the country, and to create a strong Napoleonic authoritarian regime which lasted quite some time, rivaling the endurance of the Hitler regime, even though there were no grounds to suspect that Napoleon and his heirs would not reign much longer. Yet, France’s government was defeated by the Nazi regime, and not overthrown from the inside as a result of a people’s revolt.
As a crucial feature of all three CRs was the declaration of war on the big property owners in their society. In the cases of Russia and China, the revolution aimed at the destruction of almost all types of private property, big and small. People’s personal apartments were taken possession of, and any other personal assets were seized (as what happened during the Russian Revolution to the housing facility of my grandfather who was considered to be a part of the middle bourgeois). France was a more complicated and ambivalent case. The French Revolution, along with the Constitution of 1793, supported bourgeois property; however it still had a strong egalitarian tendency which was inspired by Rousseau, and later by revolutionary radicals like Jacques Hebert. Under various pretexts, either because of their crimes against the revolution or because of their flee from France, the domain of the king, the estates of nobles, and particularly ecclesiastical property (which occurred during the quelling of the Vendee rebellion in 1793 with a special vengeance), were confiscated en mass during the revolution while all landlords lost their right to receive rent from their peasant-tenants. Marx was absolutely right when he insisted that “the property relations” was the central issue of the French Revolution, and the protection of the peasants with their free property were the basis of the Napoleonic regime.
The confiscation of big private property during the mass revolutions of France, Russia, and China split the respective societies into victors and victims, into those who enhanced their social status and those who became paupers with the loss of property (Russian princes worked as taxi drivers in Paris during the 1920s), and who with their hatred of the revolution were mostly considered, and with good reason, as the unswerving “enemies of the people,” i.e., dissenters of the new regime.

Big Property and Velvet Revolutions
The Velvet Revolutions denigrated state property as being deeply ineffective, and praised private property and the market as ways to attain instant prosperity in each country that they occurred in. As a matter of fact, the Reagan-Thatcher ideology, with its glorification of the market economy and privatization (which looked in the 1980-1990s as alluring for the whole world as the various socialist ideologies had in the previous historical period) had a tremendous impact on the leaders of the VRs. Hardly any VR, if they had happened in the current climate of financial and economic turmoil, would have advanced such leaders as Egor Gaidar in Russia, or Václav Klaus in the Czech Republic (or as Ash says, a “no-holds-barred Czech privatizer and free marketer”). It is very unlikely that the advisers from Harvard or the University of Chicago would have been invited to elaborate the economic programs for the new governments during the 1980s-1990s.
Indeed, everywhere the new elites passionately commended private property in general and existing private enterprises regardless of their origin. In 1990-1991 Russian economist Larisa Piasheva, who was extremely popular at that time, demanded the immediate privatization of everything including universities, research institutes, and prisons. The underground big property in Russia, which in many cases was indeed of criminal origin (mostly it was a product of black-market enterprises and illegal commerce), was almost instantly legalized.
At the same time, in a post-Communist society that radically altered property relations despite what happened after the previous class revolutions, there were no actions taken against the wealth of the old elites. We do not know a single fact about public dispossessions of the old nomenclature after the anti-Communist revolutions. Even if the apparatchiks were not owners of big property, we should not underestimate the wealth which was under personal control of these people: their luxury apartments – considered a major asset even for those in America — which they considered as their own (though later they were officially privatized by them ), their cars for themselves and their children, valuable jewels, paintings, foreign electronics, clothes, as well as expensive furniture and crystal (see excerpts about the wealth of apparatchiks in the diary of Central Committee high official, Alexander Cherniaev, “Sovmestnyi pokhod” p.643). Indeed, we do not know of a single instance of a mob engaging in open confiscation or plundering of a regional party secretary or minister’s apartment which was inspired by revenge and envy of their nomenclature privileges. Compare this financial and material security held by the nomenclature in 1991-1992 with the vivid scenes of the expropriation of everything that the soldiers and peasants found in the houses of the Russian aristocracy during the reckless days of the revolution, which was described so colorfully by famous Russian writers Ivan Bunin and Maxim Gorky, in addition to being portrayed in many Soviet movies, usually sympathizing with the people’s ire against the exploiters.
The radical differences in the fates of the old classes in both types of revolutions has to be attributed to the acceptance of big private property by the new elites in VRs, and their decision to transfer state property to private holders in order for anybody to have access. This was quite the contrast to the fate of the Russian and Chinese nobles and bourgeois. Indeed, the members of the former Communist nomenclature were not excluded as the potential recipients of these chunks of state property. It is now known that not a single law existed which restricted the rights of the former apparatchiks to participate in the process of privatization, even in countries where the attitudes toward Communists was not as mild as in Russia. How differently the developments would have been after a class revolution if the members of the aristocracy got the highest positions in the state and party apparatus! Instead, there were vast restrictions which were imposed on the members of the former ruling class and their families — assuming that they were not killed or sent to the Gulag after the CR.
Meanwhile, in the aftermath of VR, the members of the ruling elite and their children immediately understood that their position in the ancient regime put them in a much more advantageous position in grabbing state property in comparison with ordinary people. Indeed, who had more chance to get for a low price a chunk of oil and Gas Company, the former apparatchiks with their numerous strategic ties in the new government, or a humble citizen with his almost worthless voucher which was often sold for a bottle of vodka in the province? Again, compare this situation with the results of the class revolutions: the chances of a former landowner or the tsarist bureaucrats and their children were infinitely lower than an ordinary worker or landless peasant in attaining a lucrative niche in a new regime.
However, among the richest people in Russia already in their early 90s, we see not only Yeltsin, former member of the Politburo, but also Viktor Chernomyrdin, a former Soviet minister. In Russia according to the computation of Olga Kryshtanovskaia, a leading Russian expert on the elite, 24 percent of the new business elite were former apparatchiks, and under Putin’s reign, this figure reached 29. If one is to talk about the ruling elite as a whole, 70 percent of those in the new elites had previously held positions under the old regime. It is also true that in this process of incorporating a new class of rich people, the apparatchiks of the middle level surpassed the highest officials.
The negotiation between the old and new elite in the VR countries discussed by Ash was only possible because the members of the old ruling class were not deprived of their personal wealth, as what happened during the violent revolutions, and thus there were not staunch opponents of the new regime like the French nobles or Russian landlords. A political genius who lived three centuries before the developments which we discuss here — it was Niccolo Machiavelli — understood perfectly the connection between property and politics when advising Italian princes he wrote that “ men will sooner forget the death of their father than the loss of their patrimony” .
Each member of the previous elite, if he was not involved personally in the direct repressions, could hope in VR countries (with the exception of Russia) to get a nice position in a new regime. As Ash aptly notes, “Louis XVI gets to keep a nice little palace in Versailles, and Marie Antoinette starts a successful line in upmarket lingerie.” He correctly writes that “instead of losing their heads on the guillotine, or ending up hanging from lampposts, transition-ready members of an ancient régime, from a president such as F.W. de Klerk all the way down to local apparatchiks and secret policemen, see a bearable, even a rosier future for themselves under a new dispensation.” He continues “Not merely will they get away with their lives; not only will they remain at liberty; they will also get to retain some of their social position and wealth, or to convert their former political power into economic power (the ‘privatization of the nomenklatura’), which sometimes helps them to make startling returns to political power under more democratic rules (as, for example, have post-communists all over post-communist Europe).” Ash only neglected to indicate “a small thing,” that the radical differences between the fate of the old elites in CR and VR countries should be attributed to the differences in the changes in the property relations.
There was also another radical difference between two types of revolutions: the attitudes of the leaders towards material wealth. Those who were destroying the ancient regime during the class revolution did not even remotely think to use their high position in the new elite to gain any personal assets. Robespierre, Lenin, and Mao were all a million light years away from this thought and practice. But most activists of the VR immediately started to seize state property using tricks that fell under various shades of legality.
Yeltsin is now a textbook example of a leader of a VR who immediately began to create his personal domain and enrich the members of his family. With the slogan “enrich themselves,” which justified his own behavior and with his yearning for the protection of the family’s fortune, he could only open the gate for the old nomenclature to join him in the class of rich people. But even more important was his encouragement of criminal privatization and the emergence of new oligarchs from scratch. In fact, Yeltsin created in Russia the oligarchic, or feudal ideology, which justified the illegal transfer of state property into the hands of but a few oligarchs who by the end of 1990s were not scared to proclaim in person to Boris Berezovsky, a major theorist of Russian oligarchy in the 1990s, that now it was they, the smart guys, who had control of not only Russia’s economy, but also its politics.
The cases of those in the KGB, as well as people from the army and the police force, is a particularly interesting demonstration of how the establishment of big private property enabled the transformation of on old elite into a new one. Indeed, the KGB members that were directly involved in the repressive activity not only were deprived of the possibility to enrich themselves, but were forced to turn to the vanguard of new proprietors of lucrative positions that had access to substantial legal and illegal income. From the very beginning, former KGB members adjusted to the new reality of post-Soviet Russia much better and faster than the intellectuals and Party apparatchiks. During the final decade of the KGB’s operation, one of the more sinister figures within the organization, Philipp Bobkov, was put in charge of the persecution of dissidents. After 1991, he quite effortlessly became the head of security in the empire of oligarch Vladimir Gusinsky, one of the most despicable men in the eyes of Russian patriots. The irony of the connection between the two lays in the fact that Bobkov was the creator of the Anti-Zionist Committee of the Soviet Public only a few years before Perestroika in 1983, still, that had in no way prevented him from serving directly under Gusinsky who was vice president of the World Jewish Congress. Let us add that KGB General Alexei Kondaurov became the head of security in Khodorkovsky’s Menatep bank. Not to mention that during Putin’s reign, the Chekists easily became the leading stock holders of major Russian companies. Putin, Nikolai Patrushev, Viktor Cherkesov, Sergei Ivanov, and Viktor Ivanov, were all leading figures in the political arena under Yeltsin. And as Olga Kryshtanovskaia mentioned, the people from within the ‘power institutions’ are present in the board of directors of all leading companies. One can also reasonably assume that in addition to their generous bonuses, they also received stocks. At best, the members of the former ruling class in revolutionary Russia could hope that even if their ideology is betrayed, they could still manage to secure a humble position in the state apparatus (though there were some exceptions done only for the military).

The Contempt for Equality as a Basis for Blending the Old and New Elites
The glorification of private property by the new elites helped immensely in creating a bridge between the old and new elites. Another factor which helped to make a smooth transition between the Communist and post-Communist regime was the negative attitudes of the new elite toward equality. Indeed, the ideology of VRs implicitly and often even explicitly condemned egalitarian ideas. The disdainful attitudes towards egalitarianism from 1990-1995 was in vogue among liberals in post-Communist countries, a great contrast to all three CRs, including the French revolution, which were animated by the ideas of political and social equality. The enmity toward egalitarianism blunted the hostility toward the old dominant class with all their perks which aroused such an anger of the population. The Bolsheviks looked at the style of life of the Russian nobles and rich people with disgust, and in the aftermath of the revolution introduced the “party maximum,” a salary cap which punished those who indulged in the bourgeois “extravaganza.” The egalitarian spirit of the post-revolutionary time was not diminished by the fact that few leaders like Lenin enjoyed a relatively good life. The new elites in the VR countries were not all opposed to the privileges of the communist elites, especially if the new leaders belonged to the nomenclature. In the very beginning of his “democratic” career, Yeltsin flirted with egalitarianism, once even using a street car instead of personal limousine, but then he moved toward the direction of the opposition, toward the most luxurious lifestyle.
The new elites along with the old nomenclature became obsessed about the possibility for a lavish life, and introduced the glamorous lifestyle with its ostensible consumption.

Private Property and Corruption in VR Countries
The victory of big private property in VR countries not only accounted for the bloodless transition to the new regime, but also explains why VR paved the way for a phenomenon of cosmic proportions for these countries: corruption. Yet despite the pervasiveness of this phenomenon, it was almost totally neglected by Ash in his analysis. To be clear, when referring to corruption, I am alluding to activities which insist on the extrication of privileges from the holders of political power in exchange for material benefits of various types.
It is necessary to make the distinction between two types of radically different corruption: corruption of the officials at the highest echelons of power (big corruption –BC), and the corruption of petty functionaries like traffic police, people in commerce, teachers, or doctors (small corruption—SC). Of course, both types of corruption are correlated with one another; however the social importance of BG is exceptionally higher than of SC. What more, the size of SC is rather a function of the size of BC: if leading politicians take bribes in any capacity, clerks get the green light to take bribes without the fear of punishment. What more, BC is possible only with existence of big private property, regardless of whether it is owned by an individuals or corporation.

The Lack of Political Corruption in Totalitarian Societies
The transformation of private property into state property during the Russian and Chinese revolutions, in addition to the installment of a totalitarian regime in other countries, made BC almost impossible. During the Jacobin dictatorship, corruption was practically unfeasible, and it was Robespierre who had the nickname, “Incorruptible.” Even after the demise of the Jacobins during the Directory, the regime which emerged after the end the revolutionary terror which in some way is reminiscent of Khrushchev’s “thaw,” the level of corruption was quite high but was seemingly much lower than in the contemporary world. Corruption was relatively low in the Napoleonic Empire as well. Dubbed “the rotten plank” for his shameless profiteering, Paul Barras, the leader of the Directory, was held in contempt by Napoleon and exiled from the country. The first empire was certainly not free from corruption, particularly among Napoleon’s marshals in the conquered countries. Still, the corruption was much lower than in the subsequent regimes, which suffered from a weaker state after Napoleon’s defeat.
To be sure, the Soviet leaders were always hostile to big money, and not only for ideological reasons (big money increases social inequality by a lot, which they tried to keep in check), but rather because the accumulation of money makes the corruption of apparatchiks possible. In the early 1920s, Lenin’s New Economic Policy generated much hostility among Bolsheviks due to the fact that the fast emerging private business began to corrupt the civil war heroes with great ease; a truth described in many Soviet novels in the 1920s and 1930s. The ferocious fight of the Soviet authorities against underground businesses from the end of the NEP until Perestroika was also dictated largely by fear of party and state apparatus corruption. The Soviet system could not eliminate or even diminish small corruption which had become widespread in the previous decades of the USSR, particularly in Central Asia and the Caucasian republics. However, the Soviet system undeniably won the fight against big corruption within the country’s political spheres. Big money had no part in the decision making process in the Kremlin and its cadre policy, regardless of the allegations – which were never proved – regarding the bribery of some Politburo members during, and perhaps even before, the period of Perestroika. (There were rumors that Politburo member Frol Kozlov kept some (!) money in a friend’s safe. The gifts which Brezhnev or his daughter did receive were in fact insignificant and without any political impact.)

The Emergence of the Common Network of Political Power Holders and Owners of Big Property
As soon as big money, big property, and the contempt for social equality entered the Russian scene, big corruption made a radical jump. A single fundamental fact explains why BC made such gigantic strides during the first years of any regime in post-Communist countries after VR: the weakness of the post-Communist state.
It was Gorbachev’s Perestroika which delivered a powerful strike not only to the Soviet totalitarian state but against the Russian statehood. With Yeltsin’s rise to power, the decline of a central administration continued. Putin’s regime stopped the disintegration of the state as an institution, though only achieving political stability for the ruling elite, which is what guaranteed his personal power. However, under Putin the central administration became quite able to garner the loyalty of major political players, such as oligarchs and governors, but it continued to be weak in running the country, and was unable to control its law enforcement agencies and local authorities, which all became totally corrupted. The master of the Kremlin, a feudal king, asked only the individual loyalty necessary for the maintenance of his personal power. With a weak state and the emergence of high fortunes, the conditions for BC became ideal. From the leaders of the country down to any official with some power, all bureaucrats became involved in the exchange of privileges for various material benefits with those who had big property, including stocks in companies.
Almost all the activists of Perestroika, Yeltsin’s staff, local governments, the State and local Duma, as well as the old nomenclature that was still well connected, began to sell political services almost immediately after the victory of the VR to those who had money as well to those who promised the exchange of money and stocks for privileges which allowed them to enrich themselves. In fact, the scheme was as follows: officials provided their friends and relatives with chunks of state property at low prices or provided them with loans from state banks in order to buy big property. In turn, as soon as their disposed money or stocks were paid, the new owners immediately backed their benefactors with cash and stocks. People with various positions in society, managers of companies, research institutes, and new business people from all groups of the educated class, started using their social capital to amass wealth by a number of ways, from renting the space in their enterprises and research institutes, to selling the equipment and their products at dumping prices abroad. The initial period of privatization ended with the creation of the close interaction between political power and big private property at the national and local levels. There was not a single village or small city that did not speak about the significant corruption in the capital and regional centers in Russia where the intertwining between power and money was absent. The society turned into a common network of officials and owners of big private property, all united by mutual corruption and all having criminal records; a circumstance which made them afraid of a regime change, which could easily send them to prison based on their records.
The existing network of corrupted political and economic actors made a free and honest election practically impossible. Even regional elections needed big money. Further political developments showed that rich people were often deeply hostile toward true democracy. They had no objections against the violation of the democratic rules created by Yeltsin, and helped him to win the crucial presidential election in 1996, which was marred by offensive violations of election procedures. During Yeltsin’s time as the Russian oligarch, the owners of big money showed that they were clearly enemies of the totalitarian state, and that they did not like to be treated as Middle Age docile vassals who were obliged to kiss the hand of the king. (Tycoons behave exactly in this way with respect to the leader of any country.) Their ideal was a feudal-esque society with only a few people who control the country, as opposed to having only one ruler, tsar, general secretary, or powerful president. They were also opposed to — in their parlance — the democracy of mobs and lay people who do not understand even their own interests, let alone what is best for the country.
Indeed, wealthy Russians have ambivalent attitudes toward Putin. They are furious how he often treats them almost as servants, but at the same time they highly appreciate that he does not interfere in their businesses on an everyday basis, which permits the business owners to blend with the corrupted officials, protect their property against the threat of renationalization, and shield them against the unfriendly masses. At the time of the 2008 financial crisis, the Kremlin protected the interests of tycoons. The Kremlin seemingly ignored the ties of some Russian corporations with criminal organizations crime.
In return, as good vassals of a strong feudal monarch, Russian oligarchs fully obeyed Putin, and refused to defend one of their own, Mikhail Khodorkovsky, who was incarcerated (indeed, they are very far from having their own Magna Carta). At any moment the Russian oligarchs are ready to “voluntarily” finance the Kremlin or local boss’s election campaigns or any governmental projects. Without complaining, the oligarchs even accepted the role of whipping boy on television. In return, they can continue to increase their fortune and indulge in a luxurious life both in Russia and abroad.

Big Property and Democracy in America
Big property as a source of corruption as well as its negative impact on the democratic process is not, of course, a unique feature of the post-Communist society. It is a universal phenomenon. We can find the same kinds of corruptive developments in each democratic society. The real root of the problem lies in the fundamental fact that big property, including financial corporations, is necessary for economic progress and the Jeffersonian idea about society which is based on small owners creating a pure utopia. However, the Jeffersonian fear of big property is very well founded. Big property, with its tremendous positive effect on the economy, also generates corruption and tremendously hurts the democratic process with donors’ activities. While the Bolsheviks were afraid of big property primarily because of the danger of apparatchik corruption, true democrats have reason to be concerned about both the direct dependence of politicians on corporations, and about the reliance on government for the personal relations with the wealthy and the managers of corporations. The democrats should be troubled about the impact of big money on the election process, which makes the argument about the equality of one vote to another a ludicrous statement. At the same time, big property has played a positive role under some circumstances toward authoritarianism, particularly in sustaining the freedom of the media if, of course, leaders of corporations were not in collusion with each other in supporting the same ideology and the same regime. Having said this, we must insist that oligarchs are not sincere admirers of real democracy. The dangerous impact of big property on the functioning of the political system in the USA is a well known issue, even if mainstream social scholars tend to see all these developments as a deviation from the normal liberal society and refuse to deal with this issue as an organic part of America. The harsh critique of the political activity of corporations and their role in corruption, which occurred in the media as a rule, missed the point because these developments are treated as unfortunate and abnormal deviations from a usually well functioning democratic society, but not as a normal part of America and other Western societies.
The financial crisis of 2008 fully revealed the political role of financial corporations, and their ability to exert a tremendous influence on Washington. The crisis exposed that a small number of feudal players, the heads of big financial corporations (or as prominent economist Simon Johnson called them — “the princes of the financial world”), had become so big that the fate of the nation depended on their survival. As Johnson noted, the political balance of power, as it stood before the crisis, gave the financial sector veto power over public policy. CEOs received their bonuses like the feudal lords earned their spoils of war. The size of their incomes was not determined by market value, but by the monopoly of power, given the fact that the board of directors were submissive and endorsed their bonuses.

The Theoretical Conclusion
The developments in post-Communist countries led to the emergence of a weak state due to the spread of big property which unexpectedly opened the gate to strong feudal tendencies, to a corrupted bureaucracy, and a façade democracy with elections which were often controlled by the union of the current administration and big corporations. These developments have highlighted the necessity of new theoretical approaches which should be applied to the political processes in the contemporary world.
Indeed, the role of big property and of the corporations in the United States does not fit the dominant liberal model which claims to explain all of the major economic and political processes in American society. Yet these developments also do not fit the various versions of Marxist critiques, with its focus on class relations and disregard of the crucial role of several centers with quasi feudal power and their conflicts with one another in America. Corporations, with their interaction with individual legislators and the government in general, where money is exchanged for privileges (a so-called ‘rent seeking’ activity) radically trample on the principles of free competition and diminish the role that merit plays in the selection of cadres for the highest positions in government. Corporate activity in election campaigns makes an honest election difficult, and eventually weakens the role of ordinary people in the political process. The cases when the masses overcome the dictate of big donors and successfully confront the establishment are indeed perceived as political miracles. However, the leading political role that corporations fulfill does not completely fit the ideal totalitarian model either (totalitarianism being the extreme form of the authoritarian model). In fact, the role of corporations in contemporary society demands the use of the feudal model which supposes their existence alongside the electorate and government centers of power. Criminal organizations also come up as a serious political and economic player in many societies like Mexico, and can compete on the level of corporations in their impact on the government, national and local election process, as well as on the general life of the population. Indeed, some corporations maintain close ties with criminal organizations.
In fact, the pure liberal model presumes the political equality and the freedom of activity to all members of society, i.e. the total sovereignty of the people, “freedom to all.” The totalitarian model with absolute control over all members of society under his rule encompasses the motto “freedom to nobody.” The feudal (or oligarchic) model, to use the famous Aristotle’s typology of political regime, describes a society which combines the freedom of a few actors (the government, various corporations, local administration, and mafias) with the subordination of the rest of the population to their leaders, thus, “freedom to few.”
Nearly each society, past and present, is segmented and combines the elements of all three types of organizations. These organizations interact with each other in a unique cultural and historical context which makes the democratic and totalitarian regimes very specific in each country. The in-depth analysis of any society demands the refusal of a “one system” approach and the employment of all three models simultaneously. A society is never wholly democratic, authoritarian, feudal, or bourgeois. America and Russia are not the only contemporary societies that refute the one system model, but it is evident that countries such as Italy, Mexico, Japan, and Iran combine elements of all three types of categorical organization.
By all accounts, feudal tendencies throughout the world have intensified. The main reason for its expansion is due to the increase in the concentration of money to the limited few in power. The growing role of financial institutions, the expansion of multinational corporations, the tremendous revenues from oil, in addition to the revenue from drugs and the increasing power of criminal organizations and certain individuals who can influence the course of history in various countries and throughout the world in general. As The New York Times columnist David Brooks noted in his article published on January 5, 2009, the masses “believe big government, big business, big media and the affluent professionals are merging to form a self-serving oligarchy — with bloated government, unsustainable deficits, high taxes and intrusive regulation.”
As it seems to me, restraining the interference of big money in politics is one of the major problems of the democratic societies in the world. For the first time in history the international community has been undertaking various efforts to stem corruption. The American society has always been aware of the impact of controversial big money on the political process, and particularly on elections. Among other things, it has taken a long time to seek out the compromise between Freedom of Speech, which encompasses and demands the unrestricted use of money for legal political purpose (equating the corporation with the individual), and the intervention of big money, which undermines the honesty of the election campaign, the meritocratic principle, as well as the free competition between the political and economic markets.

A post scriptum
The last decision of the Supreme Court (January 20, 2010) is an appropriate epilogue to this text. The court, to my great sorrow, declared that the government may not ban political spending by corporations in candidate elections. It was a victory for the feudal tendencies in the country. However, it was remarkable that the court was bitterly split: 5 members of the court voted for this decision, and 4 were against. As The New York Times informs, the five opinions in the decision ran to more than 180 pages, with Justice John Paul Stevens contributing a passionate 90-page dissent. Those who voted for the decision talked about the triumph of the First Amendment, those who voted against insisted that allowing corporate money to flood the political marketplace would corrupt democracy. It is also remarkable that the American public is also split between supporting the freedom of speech, and the restrictions on the contribution of corporations. However, a larger percentage of the public supports the dissenters in the court, rather than the majority. In the aftermath of the historical decision of the Supreme Court. According to Gallup, 52 percent voted for placing the limits on campaign contributions, and 41 percent voted for protecting the rights of large corporations to support political campaigns.

I have published several books and articles in the last 15 years on feudal tendencies in the world whose titles the reader can find in my CV, which resides on my personal website: https://www.msu.edu/~shlapent/.


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