May 19, 2023 Special Dispatch No. 10619

Russian Journalist Nikiforova: Russia Is In The Same Predicament As The Bolsheviks Were A Century Ago, Like Them We Must Adopt A Centralized Economy And Reverse The Privatization Of The 1990s

May 19, 2023
Russia | Special Dispatch No. 10619

Alexander Bastrykin, head of Russia's Investigative Committee of Russia made the following declaration at the recent St. Petersburg International Legal Forum: "We are essentially talking about economic security in war conditions. And then comes the next step: let's pursue a policy of nationalization of the main sectors of our economy."[1]

As many of Russia's most important businesses are owned by the so called oligarchs, who bought up whole sectors of industry on the cheap in the privatization that followed the collapse of the Soviet Union, did Bastrykin's proposal mean that these oligarchs would be stripped of ownership of their enterprises? Vladimir Putin had essentially made a compact with the oligarchs allowing them to keep their assets provided that they stayed out of politics and occasionally contributed to solving problems in the localities where they operated. The oligarchs in the pre-invasion, pre-sanctions days used their profits to live lives of unimaginable luxury. There is also the question of  whether Bastrykin was advocating a return to a Soviet style economy, where the state controlled the means of production.

Political analyst Marat Bashirov doubted that Bastrykin or the government intended such radical measures. Bastrykin, Bashirov believed, was referring to economic sectors "where the share of not just private enterprises, but also those controlled by foreigners is high." Another situation where nationalization was warranted involved cases where the private enterprise literally and figuratively did not deliver the goods. "For example, according to the documents, the plant is supposed to produce ball bearings, but in reality, it rents out its premises for offices and retail outlets... There is no goal of nationalizing all the businesses. There is a goal of bringing order in terms of national security guidelines."[2]

Marat Bashirov (Source:

Oleg Matveichev, Deputy Chairman at the State Duma Committee on Information Policy and professor at the Financial University, interpreted the remarks as a warning to businessmen that they had better respond to state defense orders or else the government would move in. These failures could be ascribed to the fault of current management or to cases where the company lacked the requisite capital or qualified workers. Either case would justify a takeover.

Mikhail Delyagin, deputy head of the Duma Committee on Economic Policy, interpreted Bastrykin's statement in the most far-reaching manner – the government had reached the conclusion that in order to develop the Russian economy under existing conditions, it was necessary to minimize costs, which included paying for the extravagant lifestyles of the owners of factories and other enterprises.

According to Delyagin, companies should not work to pay for the maintenance of the oligarchs' yachts, but, instead, aim for "zero profits," meaning  that all profits should be ploughed back into plant modernization and expansion.

"And private business by its very nature cannot operate 'with zero profits,' since it is focused on maximizing its profits, not on the creation of added value  for society... Therefore, if someone strives to create the opportunity for Russia's development, he must nationalize the basic industries and turn them into an instrument of reduction of the costs to the economy."

Mikhail Delyagin (Source:

Russian journalist Victoria Nikiforova, in an article for the state news agency RIA Novosti, embraced Bastrykin's comment wholeheartedly and viewed it as a call to return to a Soviet-style command economy. The Bolsheviks, upon coming to power in 1917, found themselves in the same predicament that Russia is in today. Then and now, the state is threatened with economic isolation and military pressures. The Bolsheviks chose to nationalize the economy and today's Russia should follow suit. In Nikiforova's view, capitalism has exhausted itself and a return to the Soviet model will facilitate growth and promote fairness. Nikiforova's column follows below:[3]

Communist poster "Forward! Towards industrializing the country and collectivizing the villages!" (Source:

"While delivering a speech at the St. Petersburg International Legal Forum [SPIL], the head of the Investigative Committee, Alexander Bastrykin, proposed nationalizing major sectors of the Russian economy. A few years ago, such an idea would have seemed exotic. But today it is being propelled by the very course of history.

"'The model of contemporary capitalism has exhausted itself,' noted President Putin already back in 2021. Leading economists around the world agree with him: since 2020, capitalism is going through a severe crisis, there is no way out of it in sight, and all its costs fall on the shoulders of the weakest and the poorest. It's a highly unfair world order, and the further it continues, the more severe the unfairness becomes.

"Regarding the crisis, everything was clear already back in 2020: the simultaneous closure of the global economy due to lockdowns together with a stock market crash unprecedented since 1984. But then, the Western countries tried to save the situation at the expense of our country, 'how about robbing Russia under the guise of sanctions, maybe it will give us a chance to hold on.'

"In 2022, they kicked us out of the international capitalist system. In relation to our country, absolutely every law and agreement that we depended on was broken. However, Russia has honorably withstood this crash test.

"What has helped us do this? Our clearheaded planning skills, the centralized management of the sectors of the economy, the faultless performance of the state corporations. In other words, everything that was devised and tested by our ancestors in the USSR and that ensured the growth of the Soviet economy for decades.

"We cleared away the 'invisible hand of the [free] market' and this fact helped us to contend with economic problems that probably no other country could have withstood.

"The situation in which our country finds itself today resembles one of Soviet Russia back in the 1920s. Western interventionists crawled into Ukraine, the Baltic border states had become a [hostile] military base, and the Japanese warmongers were becoming active in the east. The British and the Americans (who joined in) also befouled the atmosphere. And the very same economic sanctions, the very same diplomatic pressure, the very same attempts to throw us out of the UN, similar to the Soviet Union's expulsion from the League of Nations.[4]

"The Bolsheviks acting in world isolation managed not to simply save the country, but to restart the economy, attaining its record growth. This was achieved through planning and centralized management of the economy.

"Naturally, private ownership of major means of production in such circumstances would only have hampered development. Therefore, all important sectors of the economy were controlled by the state. This did not prevent the development of private initiative in other sectors, however.[5]

"The Stalinist state not only allowed, but actively supported private business, e.g., production and industrial artels [cooperative enterprises] and collective-farms. During the war, private artels even produced shells and weapons.

"Today, artificial intelligence provides incredible opportunities for planification of the national economy. Our state corporations, from Rosatom [State Atomiс Energy Corporation] to Russian Railways, from Sberbank to Gazprom, are setting the gold standard of pulling the country out of crisis. We have every opportunity to restart our economy on new, fairer basis, to the envy of the entire world. To this end, nationalization is needed, just as it was a hundred years ago.

"Naturally, this doesn't mean that there would be any problems for honest private business. The state (apart from regular control) has no business being in the consumer sector; the latter is already doing great in our country. Our restaurateurs, cosmetologists, private doctors, and farmers provide the consumer with such a level [of products and services], with such a combination of 'price and quality,' that are without counterpart anywhere else in the world.

"Moreover, smart nationalization does not rule out future privatization, which VTB Bank head Andrey Kostin recently talked about. Only one condition: it should become attractive for small private investors, who would be interested in investing their money in their own country. Let's say, there is a dilapidated mansion, which is practically falling apart, so why not allow its privatization to an interested person? Let him set up a restaurant or a hotel there; such actions should be encouraged.

"However, when it comes to the biggest enterprises, all the resources, all the most important sectors for the country, there is a long overdue demand in society regarding their performance. This is our common national heritage, and it requires real care. Its profits should not leak to offshore companies but should go towards the country's development. And let's be honest: over the past thirty years, our large private companies have failed to prove that they work more efficiently than state corporations.

"The risky privatization of the 1990s severely traumatized our society, instilling within it a deep resentment of privatization's injustice. Clever nationalization would allow this trauma to heal and unite the country despite all class barriers.

"This is especially necessary in wartime conditions. It is impossible to urge society to mobilize, if this very mobilization is successfully avoided by the country's richest people, who continue to live in a 'Party Like a Russian' style, as if nothing had happened.

"Our nouveau riche love to whine about how the year 1917 should not be repeated. But today the country is in such a position that if we don't carry out the year 1917 here, our enemies will do it for us. Then it will be hell to pay for everyone."

Victoria Nikiforova (Source:


[1], May 12, 2023.

[2], May 12, 2023.

[3], May 14, 2023.

[4] The author is taking liberties with the time line. If the previous events occurred in the 1920s, the Soviet Union was expelled from the League following its invasion of Finland in November, 1939.

[5] Again, the author is taking liberties by lumping together War Communism (1917-1921) and the New Economic Policy – NEP (1921-1929) that allowed private enterprise in the service industries. NEP was shut down after the collectivization policy was instituted by Stalin in 1929.

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