Putin appointed Andrei Illarionov as his senior economic adviser in April 2000. Illarionov remained in that position until late December, 2005. Those were good years for the Russian economy. Simply put, it was growing, and would keep growing until 2007.
Some of the growth was simply recovery from the 1998 crisis and the 1991-96 contraction. To help with the recovery, some much-needed legislation drafted by Yeltsin’s team passed the Duma on Putin’s watch: the president’s party was finally able to form a workable coalition, which Yeltsin could not achieve in 1995-99. To balance the state budget, a sweeping tax reform was enacted, streamlining the taxes and duties on the oil and gas sector and setting the personal income tax at a flat rate of 13%.
To quote Sergei Guriev, currently the chief economist at the EBRD:
The reforms definitely produced tangible results. Gross domestic product grew at an average rate of 7% during Putin’s first term and during that part of his second term in which the reforms of the first continued to bear fruit.
In the 10 years from 1999 to 2008, Russian GDP grew by 94% and per capita GDP doubled.
On the other hand, the arrest of Platon Lebedev in July 2003 and Mikhail Khodorkovsky in October 2003 marked the start of a long-term shift towards a more repressive state and greater state or quasi-state ownership in the economy, not limited to the extractive sectors.
It would be unfair to Illarionov to blame him for not having resigned immediately after Khodorkovsky’s arrest and jailing. Even high-ranking officials were still hoping to reverse the ominous trend and Putin’s senior adviser would be in a position to have his voice heard by the decision makers in the Kremlin.
In other words, Illarionov’s record as Putin’s advisor appears quite strong. One glitch – a warning sign if only in retrospect – was Illarionov’s vociferous opposition to the Kyoto Protocol (Russia joined in 2004 all the same). Among Russian intellectuals, it was hardly unusual then to treat the solidifying global climate orthodoxy with suspicion. See this piece in Science from July 2003:
A political hurricane blew through an international scientific meeting on climate change held in Moscow last week, sparking a major row between top advisers to the British and Russian governments…
At a press conference after the meeting, Illarionov called the treaty an “undeclared war against Russia,” based on a “totalitarian ideology.” But he denies having a hand in the agenda and says he was “shocked” by British attempts at “censorship.”
Already in 2004, one could identify two emerging themes in Illarionov’s thinking: a pervasive fear of “totalitarianism” and an expansive interpretation of censorship. It’s understandable that people who once lived under genuine totalitarianism sometimes develop a strong aversion to even a whiff of that horror. Sharpened beyond a certain degree, this sensitivity could evolve into a paranoid mindset. Some personality types are more susceptible to it than others, just as certain types seem to be overrepresented among libertarians.
Looking back at Illarionov’s LiveJournal posts, one marvels at the author’s productivity and attention to detail. I find a good deal of his writing excellently argued and convincing so my focus will be on his more controversial takes.
One major, recurring theme on Illarionov’s blog is the role of Yegor Gaidar and Anatoly Chubais in Putin’s rise to power. To keep it short, Illarionov argues that both liberal reformers, especially the late Gaidar, enacted statist rather than free-market policies when they held senior government posts in the 1990s. Moreover, Gaidar allegedly preferred a managed democracy to a genuine one for Russia – managed, that is, by a coalition of reformers and securities services. It appears a strongly held conviction and a rather unorthodox one, but Illarionov’s reasoning does not look insane or unhinged to me, on a superficial browsing at least.
Illarionov’s linguistic exercises are a different matter. He has tried to retrace the long-term evolution of Putin’s aggressive plans towards Ukraine using a peculiar speech marker: the relative frequency of the prepositions na and v before the name of the country. This approach is not merely unorthodox – it is frankly bizarre. It may also explain why Illarionov attaches so much importance to Joe Biden’s unfortunate wording, “voter fraud organization.” This is a freakish cross between pop psychology and pop linguistics that can neither be taken seriously nor expected from a serious scholar.
Finally, the most troubling development predating the Reichstag Fire post was Illarionov’s radical opposition to the BLM movement, especially during the George Floyd riots in the summer of 2020. He has literally accused Nancy Pelosi of starting a new Civil War. He has literally said Kamala Harris is a communist and a black racist – in a post titled “Eighty million Americans have voted for communism.”
These are words of a vulgar right-wing propagandist, not the independent-minded economist the author once was. A Russian translation of Trumpist cant. If Illarionov’s forays into linguistic analysis were mind-boggling, they were nonetheless original in their own bitter way. When he starts using “black racism” and “BLM communism” cliches, he’s expressing his frustrations in groupspeak.
Some commenters would say that libertarians always react this way to grievances and demands of the less privileged – that libertarians always end up running for cover to some extreme-right encampment. I’m not interested in generalizations at this point.