The Symphony Strikes Back When economic privileges become too expensive
During a military parade, nothing is more eye-catching than the expensive hardware that is brought in order to display the nation’s capacities and ambitions, which are calibrated in a rigorous manner to eventually self-defend itself, a desirable scenario that is. A sense of pride and marvel usually engulfs the audience in what can cynically be described, in the words of the heavy metal band Pantera, as a “vulgar display of power”.
However, the audience rarely, if ever, questions the aspect of value, and if they do so, the numbers skyrocket to a degree where they no longer become palpable. The bread is cheap, while the circus is as expensive as ever.
The event that the world witnessed a few days ago may have been a coup, a travelling circus accompanied by the music of a reputable German composer, a rebellion, a display of power or a combination of all of the above. The nature of the event is still uncertain, but it manages to give us another example of why economic privileges can lead to complications.
The privilege of power
The nature of the “Wagner Rebellion” is still embroidered in mystery, but we can trace it to the old concept of economic privilege. History taught us that any ruler, however autocratic may he or she be, never rules alone and that any despot requires support, be it of the population (in a more democratic manner), or of the ones influential enough to actively support the system. This is true for any form of government and does not exclude contemporary Russian politics.
The feudal system itself was an illustration of economic privileges granted to the local loyal supporters of the monarch. The same applies to much of the later mercantile class system where traders, merchants and guilds managed to secure privileges with the ruler granting them monopolies, licenses or charters in the name of economic imperialism focused at that time on securing goods (such as spices) and accumulating wealth back in the home country.
However, these privileges, once granted, prove politically difficult to usurp, no matter how absolutist the ruler is. Eventually, the aristocracy found themselves in a position of power and the ability to leverage their influence in order to shape the outcome of a given situation. The mercantile class that later emerged even managed to topple the aristocratic rule over time, using their newly acquired wealth to further influence politics. The new mercantile class used the American and French Revolutions to undermine the “ancien regimes”. The rise of global commerce would have given them this power even so, but the economic privileges contributed nonetheless.
When privileges and sanctions meet
Economic sanctions have been around for a while now; however, they are well-known today given the Russian annexation of Crimea back in 2014 and the invasion of Ukraine in 2022. Presently, Russia is constantly targeted by those economic non-military constraints. Wall Street Journal released an investigation concerning the now famous Wagner Group and how, at its core, the organization is a multinational corporation set up in order to facilitate cash flows for the Kremlin. Just like at a military parade, the expensive tanks are as eye-catching as ever, undermining the financials that are running the operations from behind.
Using public funds and military assets of the Russian Government, the Wagner Group operates in war-torn countries around the world (such as Syria or the Central African Republic), providing security and military assistance to local governments in exchange for natural resources, such as shares in Syrian oilfields that they managed to secure in the war. Using a network of set-up companies, they manage to sell these commodities, leaving almost no trail behind and thus channelling funds back to Moscow while avoiding the Western sanctions. This illustration of crony capitalism has its roots in economic privileges. Offering a state-sponsored “charter” to operate in Africa or Asia using military assets of the state makes us believe that the Kremlin has learned a few lessons from the East India Company.
However, much like the nationalisation of the East India Company following the Indian Rebellion of 1857, privileges tend to haunt the ones that handed them over. Having such a vast network of dealings to generate cash flows for the Kremlin is a great way to generate leverage in a complicated political landscape such as the contemporary Russian one, and Yevgeny Prigozhin proved just that.
The event is still not well documented, and the fog of war may prove to be too dense. However, the “rebellion” offered us a glimpse of what a privilege can led to, the undermining of the benevolent ruler, i.e., the granter. Even if the history books will classify the mutiny as nothing more than a symphonic circus with expensive military-grade assets rather than a coup d’état, the public perception already showed that the two ironically statist structures involved are regarded as being more equal in power than ever.
Photo source: Mil.ru.
L’Histoire (2022). The privilege, an economic resource. Available at: https://www.lhistoire.fr/english-version-wehc/privilege-economic-resource.
The Wall Street Journal (2023a). Inside Wagner, Russia’s Secret War Company. Available at: https://www.wsj.com/livecoverage/russia-wagner-prigozhin-putin/card/inside-wagner-russia-s-secret-war-company-gPzjG25l5vIYHemKDAFG.
The Wall Street Journal (2023b). Putin, Prigozhin and the Wagner Mutiny - Russia-Ukraine War Live. WSJ. Available at: https://www.wsj.com/livecoverage/russia-wagner-prigozhin-putin-ukraine.