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Labour and Democracy in the Age of Geopolitical Anxiety

The year 2022 began with an outburst of protests in Zhanaozen, in the western Kazakh region of Mangistau known as the centre of the country’s lucrative oil extraction and processing industry. It was precisely here that a decade earlier, in December 2011, police opened fire, killing 17 and injuring more than 100 striking workers demanding wage increases. Mass demonstrations quickly spread on 2-5 January to neighbouring regions and across most of Kazakhstan. Initially, peaceful street protests turned into open clashes between the demonstrators and the police, in some cases with the police failing to confront or openly siding with protesters. Some city administration buildings were temporarily seized or set on fire, while in a few cases there was shop looting.

What began as spontaneous demands against the overnight doubling of the price of liquified petroleum gas (LPG) used to power vehicles and the runaway inflation suffered by workers during the period of the COVID-19 pandemic, quickly turned into demands against unemployment, mass layoffs, and wage increases for energy and metallurgy workers’ wages, which have remained stagnant since 2014, despite energy prices being at their historical peak since 1992. Protesting against recent layoffs and the planned restructuring and pension reforms at TengizChevrOil joint venture, workers from the large ArselorMittal steel and KazakhMys copper companies were joined by many urban unemployed, internal migrant and itinerant workers, and many young people who face the sombre prospect of joblessness, temporary and insecure jobs on the margins of the extractive-industry dominated economy, or dead-end jobs in the low value-added service companies.

The protests were ruthlessly put down when President Qasym-Jomart Toqaev issued a ‘shoot to kill’ order to internal troops against protesters, all of whom were labelled ‘foreign-trained terrorists’. Toqaev, eager to consolidate his grip on power against the ageing former President Nazarbaev who had brought him to power but still dominated via close family members most of the state and through it the national industry, called on Russia’s President Putin to provide military assistance in the form of more than 2,000 troops and 250 pieces of military equipment. It emerged several days later in specialists’ analyses that, in fact, the Russian forces had taken over the command structures of the Kazakh army and security forces, focusing on control over strategic energy, transportation, communication and infrastructure objects.

The internal Kazakh troops were now able to carry out the President’s orders, killing 225, injuring 3,000 in need of hospitalisation, and apprehending 10,000 for questioning or swift imprisonment, with over 1,000 people still detained as of this writing. The ruthless quashing of demonstrations dovetailed a major reshuffle of ministers and state companies executives, with all Nazarbaev family members or appointees losing their jobs and Nazarbaev himself being forced to relinquish his Chairmanship of the Security Council (a position he installed himself in after hand-picking his successor, Toqaev). While Toqaev may have strengthened his grip on power by ousting the Nazarbaev clan, Putin has come to control the affairs of Kazakhstan and its nominal leadership as a worthy manager in the eyes of and partly for the benefit of Xi Jinping growing ambitions for China in Eurasia.

 

The problem of labour

Problems expressed in these protests go beyond Kazakhstan geographically and appear to have broader political significance, yet always bring us back to the problem of labour. Consider the developments in Belarus since August 2020. The protests which followed the falsified presidential elections drew hundreds of thousands of peaceful protesters to the streets. Demands for transparency and fairness in the electoral process, quickly changed into calls for an end to Lukashenka’s dictatorship, reinstatement of democratic institution, return to national sovereignty and closer relations with the EU. The response was swift and ruthless, with hundreds of people beaten on the streets, thousands hauled into prisons and tortured, some dying in hospitals and dozens ‘disappearing’ after protests. The wave of popular protests was joined by an attempted general strike and individual enterprise strikes, all of which were quashed through intimidation of state violence or pressure on trade union leaders and members, as well as pressure on workers’ families.

For Lukashenka, his family and the clan dependent on him or businessmen blackmailed by him for their security and access to resources, there appeared to be few choices when confronted by angry citizens. With his back against the wall, given his concern to retain the loyalty of his elite and security forces (something Toqaev nearly lost in Kazakhstan), the Kremlin appeared as a source of guarantees against the inevitable political ostracism and economic fallout from European and American sanctions. Such guarantees came in the form of Moscow sending its security forces and offering its subventions, while Putin was able to strong-arm Lukashenka to accelerate Belarus’ accession to the Union State on Russia’s terms, in the first instance bringing its security forces and military command under Russian control. Russia eagerly used its new lever in Belarus to push the seemingly ‘unhinged’ Lukashenka to threaten Europe with an apparent new ‘migrant crisis’, luring and then weaponising migrants seeking a better life in the EU in order to increase fissures in public opinion and sharpen disagreements between EU member states. The ultimate aim of this was to push them to accede to Putin’s repeated proposals to grant Russia the unique privilege to manage, more effectively in Moscow’s rendering, the affairs of states it considers residing in its ‘sphere of influence’.

Unlike Kazakhstan’s access to the Russian Black Sea port of Novorossiysk, Belarus’ debarment from Baltic ports in Lithuania and Poland make it ever more dependent on Russia for access to world markets. Other instances of Russia using special service operations, artificial creation or incitement of conflicts and political blackmail to render regions it wants to bring under its suzerainty include wars against Georgia and between Armenia and Azerbaijan, occupation of parts of Moldova and Ukraine. Typically, this has involved Russia a relative degree of controlling of the ports, pipelines, transit routes and access to high seas, cutting off those countries that resist its embrace (Georgia, Ukraine, Moldova), while making those that accept it its dependencies (Armenia, Azerbaijan, Kazakhstan, Turkmenistan). What may be in part Kremlin’s geo-strategic manoeuvres are thus closely aligned with positioning Russia as the holder of keys for the export of energy and other natural resources to world markets. Crucially, while it cannot compete with China’s direct investments and infrastructure projects in the post-Soviet world, Russia thus attempts to position itself within as hierarchy vis-à-vis China as a key raw materials supplier, access provider and bridgehead to Western markets for the latter.

 

The global division of labour

What, then, explains both the intense protests and the periodic brutal responses to them in places like Kazakhstan and Belarus, or the slow-grinding life under repressive regimes in Turkmenistan and Uzbekistan? If autocratic regimes’ repeated message of ‘stability’, sound management and even model economic success is to be accepted as an alternative to the ostensible ‘chaos’ of Western democracies, then what explains the fears facing local elites or the fact that some choose to fall into Russia’s embrace? What, moreover, does this have to do with global capitalism, and what about the workers? While it is tempting or politically expedient to see protests and responses like these as part of a globally variegated repertoire of resistance to ‘neoliberalism’, this fails to capture both the complexity of local constellations of capital and class and neoliberalism as state policy. To make better sense of these questions, it is useful to look at these dynamics from the perspective of what the local ruling classes do when they rule, and link this to their relationship with transnational capital and the global division of labour.

The global division of labour into which the majority of the post-Soviet states are inserted places them in the periphery. For example, the Belarusian economy is dominated by a handful of large state-owned raw material and chemical processing enterprises, whose managers’ loyalty to the regime is purchased with licence for fully appropriating the firms’ profits, while the few privately-owned firms are controlled by businessmen close to the regime who, for their service of linking the regime to foreign capital receive its grace as exporters and are sheltered from competition. The Kazakh economy is dominated by oil extraction, steel production and coal mining, which due to its capital-intensive nature have allowed foreign capital to participate in the extractive and energy business either through exploration licences or joint ventures with the state, with the state dominating all of the business with transnational capital. Much the same exists in the less economically developed economies of Uzbekistan, Kyrgyzstan, Tajikistan, Turkmenistan and Armenia, and the seemingly wealthy, more independent and hydrocarbon dominated economy of Azerbaijan. Through ownership structures and the fusion of political and economic power, the local elites indenture their economies in the global value chain as highly dependent suppliers of energy and raw materials. The relative insularity of the local economies achieved through such organisation of power, moreover, makes the remaining larger private firms, especially in engineering and machine-building, unable to pursue restructuring and diversification to better integrate into the global economy, many continuing to operate Soviet-era production facilities and orienting towards local or post-Soviet (mainly Russian) markets.

The ineffectiveness of the economies comes from the vicious cycles of self-limitation, marginalisation and parasitism, which can only survive if local markets are captive and shielded from competition and if owners’ and managers’ loyalty is bought with guarantees of further insularity. The kleptocracy arising from doling out control of state-owned companies to loyal managers, their oversight by loyal ministers, and the security of such loyalty not only through material rewards but through kinship- or clan-based connection between politics and the economy leads to oligarchic regimes based on authoritarianism in both form and content — the repressive control over the local workers whose labour prices must be calibrated sensitively with fluctuations in energy and commodity markets. This lack of ‘market democracy’ is expressed at the economic level, wherein local elites simultaneously are afraid of foreign capital dominating local economies, since an open economy threatens to curtail political power derived from their economic monopoly.

At the same time, local elites act as compradors, not only trading on their political control over access to the commodities in their territories, but maintaining their ill-gotten assets in and associating their families’ future with the West. Foreign capital, for its part, avails itself of the local elites as the keepers of control over local workers, having a trusted partner in maintaining strict control over labour and keeping production costs in line with global market demand. While this may not preclude economic democracy in some existing workplaces per se, the grinding corruption, authoritarianism and lack of economic development leads to absence of job opportunities, avenues of self-realisation and widespread hopelessness especially among the young, all of which bubbled under the surface and often ignite over seemingly unrelated issues such as elections, water supplies, locality boundaries or the LPG prices. For post-Soviet elites the smell of the ‘Arab Spring’ is never too distant.

In these circumstances, Russia acts as the gendarme of Eurasia. On the one hand, the local elites need access to markets and capital, so the Kremlin utilises its military, security forces, mastery of political blackmail and cronyism to make economies on its periphery dependent on it. Russia uses its organisational, special services and military power to convince or coerce the local elites to rely on it to exercise better control over their own people, thereby making itself ‘useful’ to both the local elites and the leading capitalists in the West and in China. On the other hand, Moscow keeps the local elites closely aligned with Russia’s strategy in supplying advanced capitals with energy and raw materials, ensuring that these countries, and Russia as their holding structure, retain their place on the periphery of the global division of labour. Russia recognises its own position in the global division of labour as a supplier of energy and raw materials, but it utilises its other assets (military, financial and strategic) to control the wealth of much of Eurasia (excluding China) by maintaining the various countries in its sphere of influence as vassals. But Russia’s role extends further: it leads a historical movement, for which it uses all instruments in its arsenal, namely what Michael Burawoy, in comparing the trajectory of Russia versus China, called economic involution.

 

Involution, revolution, evolution

Without going into detail or developing the analysis in the same fashion, I want to take the development of economic involution by linking it to revolution and evolution, as well as back to the problem of democracy and labour. Briefly, the experience of the workers in the heavily industrialised Western Europe and America during the 20th century showed the route of evolutionary development. The development of the forces of production in these regions failed to produce a revolutionary subject and revolution along the lines conjectured by Marx and Engels in the Communist Manifesto. The contradiction between, and conflict with, the relations of production rarely resulted in the kind of want and political frustration that would not get resolved by political and institutional reorganisation, mainly due to the strength of social democracy, parliamentarianism and pluralism. On the other hand, in places where Marx did not originally see the possibility of revolution, namely in peasant-dominated, agriculture-based, rural, often post-colonial societies, the struggle for the rapid development of the means of production gave rise to revolutions as ‘locomotives of history’.

Today, the West and China continue their distinct revolutionary trajectories along the evolutionary path. With the demise of Soviet socialism Russia and the post-Soviet world ended up at crossroads. They could join the evolutionary path of the West, but only if they relinquished the vestiges of Soviet political organisation, a path chosen by Eastern European countries and partly by Georgia, Moldova and Ukraine. They could join the post-revolutionary China’s evolution, but only as its satraps. Or they could continue to retain those aspects of the Soviet politics that use capitalist production relations to enrich a compact elite representing an alliance between organised crime, business and special services to serve the needs of global markets for raw materials. This path requires a fierce competition between the various centres of the post-Soviet world over the primacy of control or access to these resources, a struggle in which Russia, the inheritor of the USSR’s vast economic, political and cultural endowments was positioned to win. At the same time, this means the need to reverse the development of the forces of production, including the social and intellectual development of the local workers which had been elevated by Soviet achievements, to match the deindustrialising involution, reducing the prospects of higher technologically driven, better skills based and better rewarded employment and economic pursuits that come from a more efficiently and dynamic economy. Russia has led in the use of political and organisational methods to subordinate local workers to such an involution, using its resource endowments and strategic position in relation to the West and China to leverage power and wealth for its elite within its constraints. Additionally, Russia plays a malign role in foreclosing incentives to shifting towards green energy and sustainable economy, as it is unconstrained by either democratic pluralism or consensus-seeking of a one-party state to manufacture popular legitimacy.

Democracy, therefore, is the biggest threat to Russia and the post-Soviet regimes. It is in this context that Ukraine, as the current outlier of the post-Soviet world, must be discussed in its relation to democracy and labour. We need to start with the axiom that Russia thrives where the power of the local political establishment is fused with its economic control, and where it is unrepresentative of the people over whom it rules. From the early 1990s onward, Ukraine’s traditions of rowdy democracy and the holding of authority to account by relying on binding documents and institutions had been engaged in a constant struggle with oligarchic and kleptocratic tendencies of its post-Soviet elites. Russia had worked fastidiously during this time to give primacy to elites that would fasten Ukraine’s political structures and its economy to a kleptocratic economic and oligarchic political framework. But it was not until the 2010 Presidential victory of Viktor Yanukovych that such a regime looked realistic. Its crash within three years, after the Maidan protests and the Revolution of Dignity of 2013-2014, only proved its exceptional nature. By losing Yanukovych and sensing a decisive turn of the Ukrainians towards Western capitalism, Russia had lost the local kleptocracy that could hold Ukraine together or who could allow Russia to come in and bring ‘order’ at their invitation.

By starting a war against Ukraine in 2014 Russia simultaneously is attempting to obstruct Ukraine’s fuller integration into European Union institutional structures and undermine the Ukrainians’ confidence in the rule of law and democracy. In other words, it has been trying to shake the foundations of that which prevents the Kremlin from establishing hegemony over local elites and through it to control the high seas, ports, pipelines and access routes it needs to do business. With the kleptocrats and economic clans forced to flee abroad or being pursued by the authorities, oligarchs of yesteryear are slowly being made to operate by market rules and their influence over politics is constantly diminishing. That is why the current threat of escalation by Russia against Ukraine represents a desperate measure in the face of Ukraine’s seemingly irreversible drift towards liberalism and democracy. Of course, the escalation threatens more than just Ukraine’s territorial integrity and self-determination — it threatens people’s lives, the environment, hydrocarbon dependence and workers’ liberties and ability to defend their rights in courts. It also threatens the rest of Europe because, by controlling Ukraine, Russia would make it unnecessary for Western states (whose businesses derive immediate benefits from Russia’s energy) to shift towards a green and more sustainable economy.

Does this mean that marketisation and neoliberalisation in Ukraine serves the workers’ interests? Of course not. However, rules-based political democracy, transparent institutions and the supremacy of the law, together with the EU’s focus on social partnerships, negotiated solutions via consultative committees, as well as the institutions and agencies of the European Union through which the workers’ rights are maintained, however imperfect, leave workers ample room to realise many of the rights they actually have and to use freedoms they possess to seek beneficial outcomes. In short, Ukraine today is on the frontline of the struggle for workers’ liberation. A struggle for the workers’ ability to have rules that are respected, to mobilise freely and seek the democratisation of both their workplaces and their polities and a struggle to have those liberties many in the West take for granted or have stopped valuing.

Gregory Schwartz is Senior Lecturer in Labour and Global Transformation in the School of Management at the University of Bristol.

Image credit: NICK MELNICHENKO