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How to steal a Russian airport (nytimes.com)
163 points by sajid on June 7, 2011 | hide | past | web | favorite | 47 comments

The attitude in communist countries after the Fall resembles so much to the one in "Atlas Shrugged" that it's scary. Goverment really is one big thug who will only steal. Nice countries, but it's a shame that there are people living in them. I should know. I live in one.

> The attitude in communist countries after the Fall resembles so much to the one in "Atlas Shrugged" that it's scary.

At least as far as Russia is concerned. (but you'll probably get a lot of downvotes from Rand fans, regardless if they are familiar with the situation there or not).

It was interesting how right after the collapse, it was many KGB officials who jumped into the power and land-grab and became the most staunch and cutthroat capitalists practically overnight. (And, mind you, those were supposedly the most loyal communists!).

They operated (and still do) outside the law in a sort of Randian dystopia. Slowly they absorbed the government as that was one way to crush the competitors -- the ones that own the police force, for example, always had a good advantages over the ones that didn't. The ones that owned the mayor and the legislature, had a better advantage over those that just owned the police and so on, all the way to the top.

Also, can anyone say, "contract killings"? That is just a matter of daily business there. From a pure utilitarian perspective, when millions of dollars are at stake (well in Russia it could just be hundreds of thousands), and there are no legal repercussions, why not pay someone $80K to gun down your competitor? Sounds like a sound and profitable business plan. I still am kind of surprised those things are not more common in the West were large sums of money are at stake...

Pure speculation on my part, but some of the reasons that come to mind.

  White collar crime is punished less severely then homicide.
  The parties involved don't want to get into an arms race that isn't already started.
  There is plenty of ways to make a problem go away, including the FEC and IRS.
  No single party has complete control over the government and legal system.

While I generally disagree with lobbyist, I think (at least in the United States) the extreme business interest pressed on the government tends to keep some things in check by each business demanding counter-acting changes.

The ones winning are the politicians, the ones loosing are the under-represented (the individual)

Edit: For certain values of winning

Sounds like a sound and profitable business plan. I still am kind of surprised those things are not more common in the West were large sums of money are at stake...

Anyone who watches the 'Law and Order' shows knows the police frown on rich white guys who do bad things.

I suspect that _most_ people who are in the position to make big bucks got there by having a moral code that says 'thou shalt not'. A framework for living well that allows one to thrive and be happy.

Please don't put all of post-communism-counties into one basket, as there are vast differences between them how they are dealing with democracy/capitalism. Russia is quite a special case here and unfortunately most of the times is an example of "how not to do things". But if you look at countries that were not part of Soviet Union (Czech Republic, Poland, etc.), or Baltic-countries (Latvia, Estonia, etc.) you will get a complete different image of things.

I'm living in one that wasn't part of the Soviet Union but the damage is done anyway. The thug mentality rules our contry (Romania). Maybe I was generalizing when I said post-communism countries. There are exception, but the rule is that most were influenced by the russian way of doing "business".

From the outside looking in, it seems to me like the thug mentality was deeply implanted in Romania by Ceaușescu et al. By comparison, to my mind Dubcek's lasting influence in Czechoslovakia is evident in the treatment of Havel and the dissidents in the following decades: no, they absolutely weren't treated well, but their suppression under a Ceaușescu-like regime would have been far, far worse.

The remnants of this thuggish apparatus in Romania has just turned its energy towards the best target: money.

> russian way of doing "business"

or maybe it is slavic way of doing business? or maybe it is just a consequence of collapse of old institutions and social structure combined with some cultural aspects?

just sayin.

(russian here, living in Estonia and not complaining, btw)

Aren't the Poles also a slavic people? They are doing quite well at the moment.

The attitude in communist and now most ex-communist countries ever since Stalin came to power is "why let a private individual hamstring the government with rules and lawyers when the state has the upper hand in its ability to use violence to get what it wants?".

There's also a tendency toward oligarchy and power cliques. Again, a pattern created by Stalin in which his "dictatorship of the proletariat", or the governing clique rules quasi-divinely in the interest of the people and is not subject to any limits on their power.

You've got to see it in terms of how the ex-communist oligarchy sees it. The airport was not upgraded by the financiers. They merely found the capital and hired the people to do it. It was the workers, the citizens of the Russian federation who made the upgrades to the airport with their hard work. They discount the risk and the ability to persuade capital to focus and instead concentrate on who actually did the physical work to do the upgrade.

>You've got to see it in terms of how the ex-communist oligarchy sees it. [...] It was the workers, the citizens of the Russian federation who made the upgrades to the airport with their hard work. They [... ] concentrate on who actually did the physical work to do the upgrade.

you've got to be kidding if you seriously think that "ex-communist oligarchy sees it" that way. They may _sound_ that way. No problem. The law and community/society/people interests are eagerly applied whenever it is in the real interests of the power top and easily brushed away whenever it isn't.

I'm not saying it's a correct view of reality or even in the best long term interests of their country. I'm just saying that lingering ideology, along with some paranoid nationalism thrown in is where they get their intellectual "cover" among their peers from.

Not exactly the same circumstances, but in the UK BAA has been forced to sell airports for less than they wanted due to a government body ruling to increase competition http://www.guardian.co.uk/business/2009/oct/21/baa-sells-gat...

That's what I was thinking too. What will they do when they true business men run off? Who will they loot then?

By that you assume that there are good "true business men" (those who used to run Domodedovo) and bad "thugs".

This doesn't reflect reality much. Those are just roles. One day you're a business man, the next day you participate in state-owned enterprise, the next day you're the "thug". It's wrong to try and separate good "business men" from bad "government men" because they're all drawn from the same pool.

Yeah, and both groups "run off" from time to time.

P.S. The notion that Domodedovo was the best airport compared to other Moscow airports seems to conflict with my experience. It wasn't worse but it wasn't much better. For example, during the ice rain of late December 2010 it failed straight on its face, losing power for several hours and being unable to perform.

In a lot of cases the "true business men" having their property confiscated by the government aren't much better, mostly being cronies of either a current or previous government themselves, or connected with organized crime. It's not like Russia's oligarchs suddenly sprouted business empires over the course of a few years through entrepreneurship and hard work. I tend to see it as basically conflicts within the ruling elite; sometimes one faction is in government, and sometimes another faction is, and stuff gets shadily privatized or shadily re-nationalized depending on how those power struggles ebb and flow.

.. and hopefully this is the last time I'll need to clarify this.

My comment was in relation to Atlas Shrugged and unless you've read the book, you won't necessarily understand what I mean by looters and the like.

They don't need true business men when the oil is flowing.

Have you read Atlas Shrugged?

Taking into account the brain drain that ex-USSR countries suffered in the 90's and lack of any interest in fresh ideas in architecture, music, movies and business, I think the comparison is pretty apt.

(sorry if this is another one of those "the USA is just as bad", posts, but I hope it's food for thought)

It sometimes seems to me that the real difference between stories like this and what we see in the USA is that in the States we've learned to be more subtle about it.

I offer three examples of how USA government disrespect for the rule of law is stifling America:

1. Kelo decision: it seems to have become routine for cities to condemn viable small businesses to grab land for their big voters. For example, see Columbia University in NYC.

2. GM bailout: standard bankruptcy law, determining who should get paid, was thwarted to give unions (i.e., Democrat voting blocks) favored status. This creates disincentive for future investment.

3. Boeing's new plant: the government is trying to block Boeing from moving a plant from Washington to S. Carolina, saying that their action is intended to avoid organized labor (duh), and that's illegal.

The Kelo decision was decided by the U.S. Supreme Court following an appeal of a decision in the same direction by the Supreme Court of Connecticut.

The Boeing lawsuit is being brought in federal court by the National Labor Relations Board and remains undecided. It will be subject to the full appeals process like any other court case.

I find it odd you are citing these as "examples of how USA government disrespect... the rule of law." Could you elaborate?

The Kelo decision was decided by the U.S. Supreme Court... The Boeing lawsuit is being brought in federal court by the National Labor Relations Board...

The only conclusion I can see in your statements is that the government defines the law, so if the government does it, it must be within the rule of law. But obviously that's a tautology.

Kelo is probably the clearest example of the problem: the government itself turns on its ear centuries of common law, and the clear and unambiguous text of the supreme law of the land, the Constitution. The fact that the government has said that this new definition is what must be considered the law doesn't change the fact that (a) it flies in the face of the protections that Americans believed they enjoyed; and (b) created an environment in which we're all less safe in our property.

But honestly, I think that when I wrote my initial post, when I said "rule of law", what I was actually thinking was "well-understood principles of property rights and contract law".

Sorry to reply to myself, but...

It occurs to me that the real response is, "what is the law?". Is the law simply what the government (viz, the courts and the police) say it is? Or is the law something deeper, deriving from societal norms, the social contract, and a shared understanding of moral codes?

I don't see it as a "USA is bad" post. Quite the opposite. It's a validation of what this country was founded upon.

American exceptionalism isn't that people here are incorruptible. It's that we decided wherever possible to avoid creating positions of power and influence. Precisely because it's assumed that those positions will be abused. Making sure that there are explicit limits when those positions are necessary.

The fact that we've seen this behavior "even here" should make people realize how right the founding fathers were about the nature of power and governance. Even the idea of having a national standing army was considered risky back in the day.

It should be noted that the private owners of the airport must have an excellent PR firm to get NY Times to write a favorable article. In "The Submarine" essay PG mentioned that his firm never managed to get a NYT article.

I would hardly call the article favorable. Sure it says the airport is well run and profitable, but that is just an example of how the Russian government will step in and steal . Not exactly a ringing endorsement for investment.

True, this is not a story about generating investment interest but about attracting attention to the issue and painting the government as a villain. The story is favorable because it leads the audience to pre-judge the situation in favor of the current airport owners.

Joe Nocera has written quite a few opinion columns about Russian politics, including a couple about Khodorkovsky. Looks to me like he's just interested in the subject.

The BBC has been writing similar articles recently http://news.ycombinator.com/item?id=2586983

Right, Bill Broder, the Hermitage Capital guy has been speaking up recently as well. There is going to be economic forum in St. Petersburg in 2 weeks. It is typical to see an up tick in these types of articles before major public events in Russia.

You would not even consider it might just be a good example of the point the columnist is trying to make?

It's an op-ed, not an article. A little bit easier to get.

s/must/may/, or maybe the author is interested in the state of Russia as indicated by his earlier article on the subject.

>PG mentioned that his firm never managed to get a NYT article.

At the same time though, this is an airport and government bullying, not some tech startup. I know we have our heads deep in this tech world, but come up for air for a minute and see that the differences in topic area might have had some kind of influence too.

2 legs good, 4 legs bad.

no George Orwell fans on HN then? I personally see too many parallels between Russia's versions of Communism and Capitalism. It doesn't matter how they dress it up, the ruling class are still abusing their positions and calling it progress.

So, whilst those moan at UK politicians, at least they're not as bad as this crazy mob. Quite shocking really!

Arguments of the form, "It could be worse," unfairly dismiss actual problems that need actual solving.

Sure - there's a lot of problems that need fully debating and solving. I'd agree with that. Wonder if there's a list someplace... i.e. solve malaria, distribute food in africa etc etc

The article claims that this is the reason Russia has so little innovation. Is this really true though? Yandex is a great company. VKontakte is dominating social networking there.

Russian investors (or at least Yuri Milner) appear to be doing extremely well.

The only innovative company in my view is ArtLebedev studio (which does all the UI/graphics design for Yandex and probably sole reason for their success) and most people who work there clearly see the same picture and hate it, albeit not as vocally.

Yuri Milner - CEO and Managing Partner of DST (Digital Sky Technologies) is doing well because DST invests heavily outside of Russia, namely they are one of the largest institutional shareholders of Facebook.

I wouldn't consider VKontakte to be much of an innovator, considering it essentially is a clone of Facebook.

Yandex = copy of other search engines (mostly google)

Vkontakte = direct ripoff of facebook

What's the innovation?

Having local search engines, mapping services, dominating webmail platforms and multiple social networks is itself an innovation. Innovation might happen when you have those, it would obviously never happen if you don't.

Few countries, mostly asian, dare to sustain that. Rest of the world can not.

Copying is innovation?

Innovation = new idea, new method, new product.

Sorry, your argument is bullshit.

Yes, copying is innovation.

I'm yet to see an example when a community proceeded with copying for an extensive period of time and didn't come up with innovations. Also I'm yet to see an example when a community didn't copy things already existing in the field. It's just not how it works.

E.g. Phonecian alphabet -> hebrew -> greek -> latin, cyrillic. Even hangul were drawing insights from both hieroglyphs and alphabets.

And, more often than not, "clone of X" means "tl; dr; but it looks like X". People seldom bother.

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