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Unformatted text preview: The Russian Heartland Revisited: An Assessment of Russia’s Transformation Michael Bradshaw and Jessica Prendergrast1 Abstract: The concept of “Russian Heartland,” elaborated previously by Hooson (1964) for the USSR on the basis of Mackinder’s (1919) forecast of the emergence of a land-based global power controlling the center of the Eurasian landmass, is revisited by two British geographers in the new economic, demographic, and political context of post-Soviet Russia. Using many of the same indicators as Hooson some 40 years earlier, they attempt to identify areas of strength and weakness in Russia’s contemporary geography, examining in particular the extent to which it is consolidating its “effective national territory.” The focus is on how present obstacles to this consolidation pose a security threat to Russia and neighboring states. Journal of Economic Literature, Classification Numbers: F02, O10, P20, R11. 21 figures, 3 tables, 67 references. Key words: Russian Heartland, territorial cohesion, national economy, centralization, regional change. INTRODUCTION: THE ORIGINS OF THE HEARTLAND L ast year marked the centenary of Sir Halford Mackinder’s (1904) seminal article on “The Geographical Pivot of History,” published in the Geographical Journal of the Royal Geographical Society in London. The original paper did not use the term “Heartland”; rather it was the later book Democratic Ideals and Reality, published in the aftermath of the World War I in 1919, which contained his famous dictum: “Who rules East Europe commands the Heartland: Who rules the Heartland commands the World-Island: Who rules the World-Island commands the World (see Mackinder, 1919/1962, p. 150). Mackinder’s analysis depicted a historical struggle between sea-based and land-based power in which the defensive characteristics of the Eurasian landmass afforded its occupiers a natural strategic advantage. Through his publications over an almost 40-year period between 1904 and 1943, Mackinder constantly revised his notion of the Heartland in light of the tragic consequences of two World Wars. Writing in 1943, he stated: “For our present purpose it is sufficiently accurate to say that the territory of the U.S.S.R. is equivalent to the Heartland, except in one direction” (Mackinder, 1943/1962, p. 269). Excluded were the eastern regions of the Soviet Union, which he identified as “Lenaland” after its central feature, the Lena River. To Mackinder it constituted “an area of three and three-quarter million square miles, but a 1Respectively, Professor of Human Geography (and Head of the Department of Geography) and Research Associate, The University of Leicester, University Road, Leicester, UK, LE1 7RH; emails: [email protected]; [email protected] The research presented in this article was funded by the UK’s Economic and Social Research Council, award number: RES-223-25-0039. Further details about the project can be found at: http:// www.geog.le.ac.uk/russianheartland/index.html. 83 Eurasian Geography and Economics, 2005, 46, No. 2, pp. 83-122. Copyright © 2005 by V. H. Winston & Son, Inc. All rights reserved. 84 EURASIAN GEOGRAPHY AND ECONOMICS population of only some six millions, of whom almost five millions are settled along the transcontinental railroad from Irkutsk to Vladivostok. In the remainder of this territory there are on the average over three square miles for every inhabitant. The rich natural resources— timber, water power and minerals—are as yet practically untouched (ibid.). Mackinder’s final assessment of the “Soviet Heartland” in 1943 was: “The Heartland is the greatest natural fortress on earth, for the first time in history it is manned by a garrison sufficient in number and quality” (ibid., p. 273). Our current research is not concerned with the detail of Mackinder’s geopolitical vision, nor the influence of his thinking on Cold War strategists, which was significant. Rather this paper, and the paper by Andrei Treivish (2005) that follows are concerned with the internal configuration of the “Soviet Heartland,” now the “Russian Heartland,” and in particular the impact that recent economic, demographic, and political changes are having on Russia’s occupation of its national territory. This concern has its intellectual origins in a book published 40 years ago by another British geographer, namely David Hooson’s A New Soviet Heartland? (Hooson, 1964). Published at the height of the Cold War, the goal of Hooson’s analysis was “to attempt to identify just those areas of the ‘East’ or Heartland, where economic strength is really being built up” (Hooson, 1964, p. 121). This short book was the summation of research published at the beginning of the decade in the Geographical Journal, some 20 years after Mackinder had proclaimed the effective occupation of the Heartland by the U.S.S.R. (Hooson, 1960, 1962). In his analysis, Hooson sought to map the Soviet Union’s eastward expansion as a counter to what he saw as the “monumental vagueness” that was found in Soviet and Western commentary on the Soviet Union’s “Eastern regions.” He introduced the concept of “Effective National Territory,” which he defined in a subsequent text on the Soviet Union as: “that major part of the country which consistently produces a surplus in relation to its population and which, by implication, is therefore supporting the rest of the country in a real sense” (Hooson, 1966, pp. 342-343). In his heartland analysis, Hooson employed six criteria to determine the extent to which particular regions contributed to the Soviet Union’s economic, military, and political power. These were: (1) scale of contribution to the national economy as a whole; (2) rate of population (especially city) growth; (3) relative importance of accessible resources; (4) economic specialization, which will necessarily, in many cases, involve a combination of agricultural and industrial specialisms; (5) a certain community of historical associations; and (6) ethnic considerations where they actually loom large in the distinctiveness of a region (Hooson, 1964, p. 15). By assessing the contemporary geography of the Soviet Union in the early 1960s he was able to divide the territory into three regions (Fig. 1). The E stablished European Core accounted for 40 percent of the Soviet population and industrial output and remained economically vital to the nation’s power, but was growing at a much slower rate than the second region, the Expanding Volga-Baykal Zone. This region, which was further subdivided into the Volga-Ural, Ural-Ob’, and Central Siberian regions, accounted for a little more than a quarter of the total Soviet population and agricultural output and about a third of its industry. But it was growing rapidly and gaining ground on the European Core. The first two regions combined “accounted for more than two-thirds of the Soviet population, at least three quarters of its industrial and agricultural output, and some four-fifths of the accessible industrial energy and raw materials” (Hooson, 1964, p. 16). The remaining regions were described as the Marginal Zone, a “heterogeneous collection of regions, spreading over two-thirds of the Soviet area but possessing less than a third of its population, and a much smaller proportion of national production and resources” (Hooson, 1964, pp. 16-17). BRADSHAW AND PRENDERGRAST 85 Fig. 1. Hooson’s regional groupings. The bulk of the book is then taken up with an analysis of the national framework of economy and settlement and a more detailed analysis of the sub-regions of the Volga-Baykal zone. In the concluding section, entitled “Soviet Power—and Mackinder,” Hooson considered the implications of his analysis for the Soviet Union’s economic and political status. He noted: “The most fundamental of all the elements of national power is sheer location on the globe. Although this is often regarded as absolute and immutable, it is in reality relative to the other parts of the world and its significance changes as they change, and therefore has to be constantly reassessed” (Hooson, 1964, p. 117). While acknowledging the continuing absolute dominance of the European Core, he stressed that the Volga-Baykal was the new center of dynamism and the source of the Soviet Union’s future power. He concluded: . . . whatever superior locational assets in terms of the modern economy may be attributed, and rightly, to the Ukraine and the Moscow region, there are a number of compelling reasons—ideological, nationalistic and strategic, but also economic— which make it more likely that we will be witnessing for some time a steady easterly drift of industrial population along the trail blazed by its agricultural forerunners less than a lifetime ago. Finally, it seems certain that the Soviet Union as a superpower will, on balance, be strengthened rather than weakened by making full use of the whole of its economically usable triangle, rather than just its long-established base in Europe (Hooson, 1964, 126). HOOSON’S HEARTLAND REVISITED The purpose of this paper is to employ a revised version of Hooson’s original analytical framework to assess Russia’s New Heartland. At the time the original analysis was 86 EURASIAN GEOGRAPHY AND ECONOMICS conducted the Soviet Union’s eastward expansion had yet to reach its zenith. The late 1960s and 1970s saw the crash development of the West Siberian oil and gas fields and the construction of a series of huge hydroelectric power stations and associated heavy industrial centers along the Angara-Yenisey river system. Finally, the 1980s saw the construction of the Baykal-Amur Mainline, a railway aimed at making accessible those marginal regions of Mackinder’s Lenaland. There is, perhaps, a certain irony in the fact that the population of the Soviet Union’s eastern regions peaked just as the Soviet empire collapsed. In fact, rather than strengthening the economy, the rising costs of Siberian resource development were a major cause of the economic slowdown in the Soviet Union during the 1980s (Aganbegyan, 1988). The current analysis seeks to map changes in the effective occupation of Russia’s national territory from 1989 to 2002, a period that encompasses the final days of the Soviet era and the subsequent decade of transformation. The year 1989 is chosen as a reference point as it was the year of the last Soviet census. The year 2002 is chosen as the end point as it was the year of the first post-Soviet Russian census. Unfortunately, while there is a degree of continuity between the Soviet and post-Soviet period when it comes to demographic data, the same cannot be said for socio-economic and political indicators. For understandable reasons, there simply are not sufficient time series data to chart the changing geography of Russia’s Heartland continuously throughout the 1990s. Just as the economic and political system changed dramatically, so did the kinds of information needed to monitor that change. In the late 1980s and early 1990s there was still a shortage of information on the regional dimensions of Russia’s economic and political geography. Conversely, later during the 1990s there was a virtual avalanche of new information on political parties, voting patterns, and indicators of regional socio-economic status. This spawned an entire industry collating data, creating typologies, and presenting rankings;2 however, few researchers took the time to step back and analyze the bigger picture. The current project has precisely this objective, assessing the geographical consequences of Russia’s recent economic, political, and demographic transformations for the effective occupation of its national territory. Furthermore, as this paper is part of a broader Research Programme on New Security Challenges sponsored by the UK’s Economic and Social Research Council (ESRC), we also are interested in how challenges to Russia’s effective occupation of its territory pose security threats to the Russian state (both federal and regional), to Russia’s neighbors, and to the international community. Rather than focusing on state power, we are concerned with how the weakness of the Russian state, despite its current desire to recentralize, is creating political, economic, and social tensions within the country and is also presenting opportunities for illegal activities ranging from smuggling to illegal arms sales and human trafficking. Given the dramatically different circumstances and the different geographical frame, the Russian Federation rather than the Soviet Union, it is not practical, nor desirable, to simply replicate the six criteria used in Hooson’s original analysis. Instead, we have modified the original criteria as shown below: Economic Dimensions • Scale of contribution to the national economy • Economic specialization and resource dependence 2The most durable of these has been Ekspert Magazine’s Regional Investment Rating [http://www.expert.ru/ expert/ratings/regions/]. BRADSHAW AND PRENDERGRAST 87 Political Dimensions • Regionalism • Ethnic considerations Demographic Dimensions • Population growth/decline • City growth/decline Some of these criteria, principally the economic and demographic dimensions, lend themselves to quantitative analysis; the political dimension (beyond the area of electoral geography) does not, and is the subject of more qualitative and discursive analysis. This makes direct comparison across the dimensions rather difficult, as not all dimensions can be mapped and then compared, as is the case with layers in a Geographic Information System (GIS). The more qualitative aspects of the political dimensions are analyzed via a review of academic research, whereas the more quantitative dimensions of economy and demography allow analysis of secondary statistical data, as well as analysis of previous research. In the latter case, we have made use of a GIS to store, analyze, and map socio-economic, electoral, and demographic data. Just as Hooson’s analysis was an exercise in mapping the contours of the New Soviet Heartland, so we have sought to map the various dimensions of the New Russian Heartland. However, given the complexity of the current situation we have stopped short of producing a definitive map delimiting the boundaries of the Heartland. As will become clear from this paper, one of the problems with the contemporary Heartland is that it is fragmented and there is limited spatial coincidence between the various dimensions. We have evoked the European Commission’s notion of “territorial cohesion” in seeking to assess the consequences of the contemporary situation.3 In the contemporary Russian context we are interested in whether or not uneven development, increasing disparities, and territorial fragmentation are threatening the cohesion of the Russian state. The analysis that follows is organized according to the three dimensions identified above. The first section examines the economic dimensions, the second the political dimensions and the final section the demographic dimensions. Our analysis affords a great deal more attention to the political dimension than Hooson’s original analysis, for reasons that should become obvious. During the 1990s issues relating to center-region relations and the status of the ethnic republics dominated analysis of the regional dimensions of transformation in Russia and clearly threatened the territorial cohesion of the Russian state. These analytical sections are then followed by a discussion of our findings and a short conclusion.4 ECONOMIC DIMENSIONS OF THE NEW RUSSIAN HEARTLAND Much has been written on the regional economic dimensions of Russia’s transformation from a planned economy to some form of market economy, and a good deal of work remains 3In its Third Periodic Report on economic and social cohesion in the European Union, the European Commission (2004, p. 27) viewed the objective of “territorial cohesion” as “. . . to achieve a more balanced development by reducing existing disparities, avoiding territorial imbalances and by making both sectoral policies that have a spatial impact and regional policy more coherent. The concern is also to improve territorial integration and encourage cooperation between regions.” 4In additional to this paper, a number of related working papers and a bibliography can be found on the project website (see note 1). 88 EURASIAN GEOGRAPHY AND ECONOMICS to be done.5 Our purpose here is to assess how the changes that have taken place in the Russian economy since the early 1990s have impacted the distribution of economic activity. Such an analysis is far from straightforward and faces a number of data problems. First and foremost, measuring economic change from the late 1990s to the early years of the current decade means comparing statistics generated by the Soviet planned economy with those now being produced to measure Russia’s market economy. Second, while a huge amount of data now are available on the Russian economy, concerns remain about the role of the “shadow economy,” the distorting effect of domestic prices (in comparison to world prices), and the impact of certain tax management schemes, such as transfer pricing (discussed below). Third, while we have seen no major changes in the territorial-administrative structure of the Russian Federation, seven presidential districts6 have been introduced in place of the 11 economic regions, which has required the reworking of summary data. Finally, the high-inflation environment of the 1990s further complicates the use of value-based time series data, making it more sensible to use physical measures such as employment and actual volumes of goods produced, although the latter is problematic in the service sector. Because of all of these limitations, we have sought to keep things as simple as possible. The economic criteria employed by Hooson focused on the relative contribution of the various regions to the national economy, the nature of economic specialization, and the extent of the accessible resource base. At the time of his study the Soviet economy was still growing, and while he accepted that in absolute terms the bulk of the Soviet economy was located in the “European Core,” Hooson identified the most dynamic regions as those in his “Volga-Baikal Zone.” The context for our analysis is quite different, as between 1990 and 1998, the year of the financial crisis, Russia’s industrial production fell by more than 50 percent and its GDP fell to about 60 percent of its peak in 1989 (Maurseth, 2003, p. 1167). However, since 1998 the economy has staged an impressive rebound. In the five years between 1998 and the end of 2003 the economy grew by 38 percent, and unemployment has fallen from 18 percent in 1998 to around 8 percent (OECD, 2004; World Bank 2004). However, despite the recent recovery, the fact remains that Russia’s economy is a good deal smaller than it was in 1991, although just how much smaller is impossible to determine. Furthermore, the years of “transitional recession” in the early 1990s have brought about significant structural changes in Russia’s regional economies. While the macro-economic context is important, we are most interested in how the restructuring of the Russian economy has affected the contours of the “effective national territory” and whether changes in the economic landscape pose a threat to territorial cohesion. Restructuring and Regional Change It is widely recognized that 1998 marked a watershed in Russia’s economic transformation. Between 1991 and 1998 the emphasis was upon the consequences of transitional recession (see Hanson and Bradshaw, 2000 and Westlund et al., 2000). Analysis of regional economic change focused on explaining regional variations in economic performance (see for example, Sutherland and Hanson, 1996 and van Selm, 1998). During this period it seemed that inherited economic structure was one of the most important factors explaining the relative degree of regional economic decline. As van Selm (1998, pp. 617-618) noted, 5See Bradshaw and Treyvish (2000) for a review of the English- and Russian-language research on regional economic change in Russia during the 1990s. 6Northwest, Central, Volga, Southern (North Caucasus), Ural, Siberia, and Far East. BRADSHAW AND PRENDERGRAST 89 Fig. 2. Industrial production in 1998 relative to 1990 (1990 = 100). “regions with the right industries did better than regions with the wrong industries.” As Figure 2 shows,7 there was a clear northerly and easterly orientation to the regions that suffered the least. In sectoral terms, it was Russia’s resource regions that weathered the recession the best, while regions specializing in manufacturing and light industry (most prevalent in European Russia) experienced significant decline. Between 1990 and 1997, according to official figures, production in the fuel and energy complex fell by 32 percent, compared with declines of 59 percent in machine-building and 86 percent in light industry (Sutherland et al., 2000, p. 46). The recent situation is rather different (Fig. 3), as new centers of growth have emerged in European Russia. These are regions benefiting from a market-oriented recovery in manufacturing, particularly in the food-processing industries, but the resource sector remains the engine of recovery.8 The cumulative impact of change from 1990 to 2001 is shown in Figure 4. Official data suggest that the industrial economy has declined and Russia’s service economy has expanded. More specifically, industry’s share of GNP (in 2000 prices) fell from 38.6 percent in 1990 to 32.5 percent in 2001 (Dynkin 2002, p. 54), while the share of total employment in industry decreased from 30.3 percent in 1990 to 22.5 percent in 2002 (World Bank, 2004, pp. 76-77). Conversely, employment in market services increased from 7In Figures 2 through 8, data for lower-order autonomous regions (okrugs and the Jewish Autonomous Oblast) are included in the higher-level unit (i.e., the Komi-Permyak Autonomous Okrug is included with the rest of Perm’ Oblast, and both regions are shaded as one unit). Unless indicated otherwise, all the data used in these maps has been obtained from various editions of the Goskomstat publication Regiony Rossii. 8Over the past three years, the resource sector has accounted for 70 percent of the growth in industrial output (OECD, 2004, p. 21). 90 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 3. Industrial production in 2001 relative to 1998 (1998 = 100). Fig. 4. Industrial production in 2001 relative to 1990 (1990 = 100). BRADSHAW AND PRENDERGRAST 91 16.7 percent in 1990 to 26.6 percent in 2002. These data tend to support a process of economic restructuring entailing de-industrialization and service sector growth. However, the aforementioned World Bank study, subsequently reported on in the recent OECD Economic Survey of Russia (2004, p. 20) suggests that official figures significantly underestimate the role of industrial production and overstate the share of the service sector: official statistics for 2003 show that industry accounted for 27 percent of Russia’s GDP and services 60 percent (ibid., p. 20). A major contributing factor is likely the widespread practice of transfer pricing in the resource sector.9 Using Canadian trade margins, the World Bank (2004) re-assessed the value of Russia’s resource production, and as a result the share of industry in GDP in 2003 increased to 41 percent, while the share of services declined to 46 percent. Consequently, rather than de-industrialization, what appears to be occurring is “primitivization,” as Russia’s industrial base has retreated into the resource sector. In other words, the manufacturing economy has experienced significant decline and limited recovery, while the resource economy experienced less significant decline and recently has exhibited appreciable growth. This differential performance has important geographical consequences, as we demonstrate below. Contribution to the National Economy Returning to Hooson’s original criteria, we can see that economic transformation has resulted in shrinkage of the national economy and an increased reliance on the resource economy, which has changed the extent to which individual regions contribute to the national economy. As we shall see in a later section, the 1990s also witnessed significant changes in the distribution of population. This sub-section considers regional variations in levels of economic development and the relationship between economic activity and population distribution. Table 1 provides summary data on territory, population, and economic activity by presidential district. On the basis of the analysis conducted, we have further reduced the seven districts to a two-fold division between a core region comprising the Central, Northwest, Volga, and Urals districts and a periphery region consisting of the Southern (or North Caucasus), Siberian, and Far Eastern districts. We are all too aware that such a macroregionalization hides a high degree of heterogeneity, but for the present we are concerned with macro-scale change; our analysis also considers variation both between and within oblast-level units. The data in Table 1 show the clear imbalance between territory and population, the core accounting for 30.2 per cent of Russian territory, but 73.8 percent of economic activity in 2001.10 These data suggest a slight increase in the share of population residing in the periphery. This is examined in a later section, but as is clear from the federal district–level data, this is because the increased population share of the Southern District more than compensates for the decline in the share of Siberia and the Far East. As will be clear shortly, two factors explain the increasing economic dominance of the core: the economic weight of Moscow and 9Transfer pricing typically occurs when a resource-producing enterprise within a larger holding company sells its output to a trading company within the same holding company for an artificially low domestic price (which depresses the value of the output of the resource producer). The trading company then exports the product at the world market price and the transaction is recorded as a service activity (thus increasing the level of service activity). For an alternative method of calculating value-added in the oil and gas sector and its contribution to Russian GDP, see Kuboniwa et al. (2005). 10This represents an increase from 69.9 percent in 1990. 92 EURASIAN GEOGRAPHY AND ECONOMICS Table 1. Regional Distribution of Territory, Population, and Economy by Federal District and Macroregion, 1989–1990 to 2001–2002 (percentage of Russian total)a Federal district Territory Population, 1989 census NMP, 1990 Population, 2002 census GRP, 2001 Central Northwest Southern Volga Urals Siberia Far Eastern 3.8 9.8 3.4 6.1 10.5 30.0 36.4 25.8 10.4 14.0 21.6 8.5 14.3 5.4 28.3 10.9 11.7 20.6 10.1 12.6 5.7 25.3 9.9 15.0 22.0 8.7 14.3 4.9 32.9 9.7 7.8 22.2 9.0 13.5 5.0 65.9 34.2 73.8 26.3 Macroregion Core Periphery 30.2 69.8 66.3 33.7 69.9 30.0 aNMP= Net Material Product; GRP= Gross Regional Product; Core = Central, Northwest, Volga, and Urals districts; Periphery= Southern, Siberian and Far Eastern districts. Sources: Compiled by authors from Goskomstat RF, 1991 and Gosmkomstat Rossii, 2003, pp. 48-41. the inclusion of Tyumen’ Oblast in the Urals Federal District.11 To identify the processes underlying these summary data, one must examine oblast-level patterns. Figure 5 examines changes in the degree of territorial concentration of economic activity in 1990 and 2001. The results should be treated with caution because NMP is a Soviet-era measure that underestimated the contribution of the service sector and did not include some aspects of the defence sector.12 However, these are the only data available for the late Soviet period. In addition, we only have data for 73 regions, rather than the 89 federal subjects in 2001. What the graph shows is relatively lower levels of concentration and variation in 1990 (the standard deviation for percentage of national production is 1.4), when the top 10 regions in aggregate accounted for 39.3 percent of national production. By comparison, the situation in 2001, which uses a measure more attuned to a market economy, shows higher degrees of concentration and variation (the standard deviation is 2.4). In 2001, the top 10 regions account of 50.7 percent of total GRP.13 Table 2 lists the top 10 regions in 1990 and 2001. There is surprisingly little change in the composition of the listing, but the regions’ overall share has risen substantially, largely due to the increasing significance of Moscow and Tyumen’. The situation in 2001 also suggests that the remaining regions contributed only 46.1 percent of Russia gross regional product. Comparison of the bottom (lowest-ranking) 10 regions is complicated by the fact that the 1990 data are only for 73 regions; however, the majority of those at the bottom in both 11Previously, Tyumen’ Oblast and its constituent autonomous okrugs were included in the West Siberian economic region, though in an earlier version of system of economic regionalization, they were part of the Urals. Obviously, the significance of the oil and gas industry in these regions has a major impact on our macro-level analysis. 12The net result is that it is biased toward the resource and machine-building sectors; furthermore, it is subject to the distortions of the Soviet pricing system, which undervalued resources and overvalued manufactured goods. 13 Moscow’s share of national economic activity appears to have doubled from 10.0 percent in 1990 to 20.7 percent in 2001 (Table 2). BRADSHAW AND PRENDERGRAST 93 Fig. 5. Decile distribution of Net Material Product (NMP) and Gross Regional Product (GRP) in 1990 and 2001. Table 2. Economic Activity of Top 10 Regions, 1990 and 2001 Region Moscow City St. Petersburg Tyumen’ Oblasta Moscow Oblast Krasnodar Kray Sverdlovsk Oblast Krasnoyarsk Kray Rostov Oblast Samara Oblast Republic of Bashkortostan Top 10 as percent of total Percent of NMP in 1990 10.0 4.4 4.3 4.1 3.2 2.9 2.7 2.6 2.6 2.5 39.3 Region Moscow City Khanty-Mansia St. Petersburg Moscow Oblast Krasnoyarsk Kray Republic of Tatarstan Sverdlovsk Oblast Samara Oblast Krasnodar Kray Republic of Bashkortostan Top 10 as percent of total Percent of GRP in 2001 20.7 7.2 3.5 3.4 3.0 2.8 2.7 2.6 2.4 2.4 50.7 aA direct comparison with 1990 would include the Khanty-Mansy and Yamal-Nenets autonomous okrugs with the remainder of Tyumen’ Oblast (as Tyumen’ Oblast); the top 10 would then account for 53.3 percent. Sources: Compiled by authors from Goskomstat RF, 1991 and Goskomstat Rossii, 2003, pp. 48-41. sets of data are republics and regions in the Southern and Siberian districts. What is abundantly clear is that, with a few notable exceptions, Russia’s republics are among the poorest regions in the country; as will become apparent later, in most instances their significance does not come from their economic weight. Figure 6 presents information on GRP per capita in 2001 at the oblast level. This measure of economic output per person is useful, as it illustrates the mismatch between population and economy that has been amplified by 94 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 6. Gross Regional Product per capita in Russia’s regions, 2001. developments during the 1990s. In a recent analysis of regional economic performance in Russia, Aton Capital (2004, p. 4) concluded that “. . . very few regions have moved significantly up or down the ranking ladder and the poorest regions appear to be caught in what could be termed a poverty trap despite registering some growth gains.” The clear northern and eastern bias in terms of GRP per capita points to the increased significance of the resource sector, which dominates those regions, as well as their relatively sparse population. Perhaps of greater significance are the lower levels of economic activity that dominate Russia’s southern borders and the European core region. As is explained later, the southern borders have been the destination of migrants from the bordering post-Soviet states and these regions are among the poorest in Russia, placing additional burden on an already depressed economic situation. The same can be said for the southern regions of the Volga, Urals, and Siberian districts. The contrast would be even starker in a threedimensional representation of GRP per capita, with Moscow standing out clearly against an otherwise lower than national average Central District, and Tyumen’ Oblast towering above surrounding regions, especially Russia’s southern borderlands. In summary, compared to Hooson’s analysis of a dominant European core and dynamic Volga-Baykal region, the current economic geography of Russia is far less impressive. The dominance of the European regions of Russia is entirely due to the overwhelming economic significance of Moscow and the contribution of a handful of major industrial city-regions, such as St. Petersburg, Samara, and Yekaterinburg (Sverdlovsk), while Russia’s apparent economic recovery seems to have been achieved by resource production in sparsely populated northern and eastern regions. In their recent analysis Aton Capital (2004, p. 4) concluded: BRADSHAW AND PRENDERGRAST 95 A glance at the 20 largest regions in terms of GRP shows one of the key common denominators is a large urban centre (12 of the regions have a city with at least 1 mn people). Large cities boast a large consumer base providing potential for the retail, wholesale, and construction industries. Additionally, a significant share of GRP coming from natural resource–based production, be it oil, gas, metals, gold or diamonds, has a clear positive correlation with the region’s GRP size. The significance of Russia’s resource economy is subject of the final subsection on the economic dimension. Economic Specialization and Resource Dependence It is widely recognized that Russia’s economic recovery has been achieved in large part by the increased export earnings of its resource sectors, not just oil and gas, but ferrous and nonferrous metals, forest products, and precious stones. In 2003 resources accounted for 67 percent of Russia’s exports by value and oil and gas alone 54 percent (OECD, 2004, p. 35). In 2003, 37 percent of Government revenues originated from hydrocarbons (World Bank, 2004, p. 8). There is a surprising continuity here with the late Soviet period when those same exports bankrolled imports of Western machinery, equipment, and grain. Then such exports merely delayed the collapse of the Soviet economy, whereas today the concern is that Russia’s current reliance on resource exports is postponing a potentially painful period of economic adjustment, as the Russian Government has become complacent about reforms and domestic producers have not invested in increasing their competitiveness. In short Russia is now suffering from the symptoms of the “resource curse.”14 Both the World Bank (2004) and OECD (2004) studies discussed above, as well as pronouncements by President Putin and his various ministers and advisers have acknowledged the significance of resource export earnings to the performance of the Russian economy as well as the need to diversify the economy to reduce the consequences of the inevitable future decline in export earnings, either because of a fall in resource prices and/or the inability of Russia’s resource producers to maintain export production. The latter is likely to result from a combination of rising domestic consumption and a failure to maintain domestic production due to inadequate investment in new capacity.15 The debate continues to rage as to whether Russia’s resource wealth is a blessing or a curse, but our primarily concern here is to consider the geographical dimensions of Russia’s resource abundance. Figure 7 shows the regional distribution of economic output attributable to the “resource industries”16 in Russia in 2002 and Table 3 provides details on the industrial structure of those regions dominated by the resource sector. These 21 regions are defined as “resource regions” because more than 40 percent of their industrial output comes from one or more of the fuels, ferrous metal, nonferrous metal, and forestry sectors. As is also clear from Table 3, in most of these regions the share of industry in GRP is higher than the Russian average; furthermore, in most instances one of the four resource sectors accounts for the majority of regional output. Thus, these are classic resource regions, narrowly focused on and highly reliant upon the exploitation one or two commodi14See Kim (2003) for a fuller explanation and Hill (2004a) for an analysis of the significance of Russia’s energy wealth. 15See Leijonheilm and Larsson (2004) and Dienes (2004) for recent assessments. 16Defined here as the mineral fuels (e.g., oil, gas, coal), ferrous metals, nonferrous metals, and the forest industry. 96 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 7. Percentage of industrial production attributable to the “resource industries” in 2002. ties, be it oil, natural gas, steel, or aluminium. In aggregate, these regions accounted for 33.3 percent of Russia’s total gross regional product (2001) and 42.2 percent of Russian exports (2002); they are home to 26.9 percent of Russia’s population and account for 61.4 percent of its territory. Geographically, they are predominantly located in the northern and eastern regions of the country. As will become apparent in the next section, they include some of Russia’s more strident republics, which have been able to capture a significant amount of the economic rent generated by their resource economies for use in promoting their own national identities. But perhaps the most significant factor here is the limited control over resource revenues exercised by the constituent autonomous regions within Tyumen’ Oblast. The New Russian Heartland that has emerged from our analysis thus far is structurally and geographically quite different from Hooson’s New Soviet Heartland of the 1960s. It is a product of Russia’s natural resource wealth and export potential rather than its domestic industrial capacity. Consequently there is a clear mismatch between those regions that carry the greatest economic weight and those that are the most populous. As shall become evident in a subsequent section on demographic dimensions, this is a situation that appears likely to become more pronounced in the future. The next section considers how Russia’s transformation has resulted in renewed tensions between Moscow and the regions, producing a political asymmetry that needs to be mapped onto our economic analysis. POLITICAL DIMENSIONS: REGIONALISM AND ETHNIC CONSIDERATIONS Russia’s ethno-territorial federal structure reflects a confused ideological understanding of nation—a part of the Soviet inheritance that reified primordial ethnic identities as BRADSHAW AND PRENDERGRAST 97 Table 3. Russia’s Resource Regions Region Russia Tyumen’ Sakha Komi Krasnoyarsk Vologda Kemerovo Orenburg Arkhangel’sk Tomsk Astrakhan’ Chelyabinsk Magadan Karelia Ingushetia Lipetsk Irkutsk Khakassia Perm’ Tatarstan Bashkortostan Federal district Urals Far Eastern Northwest Siberian Northwest Siberian Volga Northwest Siberian Southern Urals Far Eastern Northwest Southern Central Siberian Siberian Volga Volga Volga Resource Regional Industry as a pct. share of as a pct. of total Fuels GRP in of GRP, industry, 2001 2001 2002 100.0 10.4 1.3 1.1 3.0 0.9 1.5 1.1 0.9 0.8 0.5 0.9 0.2 0.4 0.1 0.7 1.6 0.3 2.4 2.8 2.4 31.0 47.5 48.3 39.8 63.2 45.5 43.5 38.3 40 33.1 26.6 44 60.0 41.4 16.1 50.5 34.7 43.5 37.3 45 36.3 40.1 87.3 83.0 79.3 76.2 68.3 68.7 69.1 66.1 52.7 61.3 62.3 63.0 63.0 59.8 61.9 53.2 60.4 41.8 41.3 41.7 19.9 86.7 11.0 55.5 3.4 31.1 47.7 21.2 34.4 60.7 0.8 1.4 Ferrous metals Nonferrous Forestry metals 8.1 7.7 0.4 59.8 34.0 12.1 0.1 0.2 71.2 0.3 68.4 0.2 3.2 9.0 0.3 15.9 53.4 12.8 7.2 61.6 5.0 57.7 6.8 9.8 25.6 39.6 35.5 61.8 1.4 3.7 4.2 0.2 2.1 23.2 45.7 4.8 2.3 4.4 0.6 0.8 23.5 4.0 8.3 0.4 0.3 44.5 2.2 0.6 0.9 45.2 2.1 0.1 21.8 1.2 7.2 1.5 1.8 Source: Calculated by the authors from data in Goskomstat Rossii, 2003, pp. 38-41, 324-325, and 418-421. permanent and unchangeable, linked them to specific territories (or homelands), and attributed to them political authority. This legacy left Russia with little choice but to adopt a federal structure that replicated the Soviet ethno-territorial system. To have done otherwise (e.g., to adopt a wholly territorial system) would almost certainly have resulted in widespread unrest and protest in the ethnic republics and possibly hastened the break-up of the Russian Federation. Given this legacy, it is hardly surprising that half-hearted state-led efforts have failed to instil popular acceptance of a multi-ethnic inclusive civic understanding of the Russian nation as a single political community, a conception that is rejected by Russian and non-Russian ethno-nationalists alike.17 Identity alternatives, however, need not be sources of instability, and rather can coexist in a defined hierarchy—for example, ethnic Englishness (fairly) happily coexists with civic 17“National” as used in this paper always relates to a civic understanding of nation, unless otherwise specified, for example, as ethno-national. Likewise region, unless otherwise indicated, is used in the sense of Russia’s 89 administrative regional units. 98 EURASIAN GEOGRAPHY AND ECONOMICS Britishness, and European identity with both. However, Russia is a multi-ethnic country where significant numbers believe self-determination rights are collectively engendered by ethno-cultural features. In this context a strong civic identity would serve to legitimize the political authority of the state leadership and the country’s borders. In its absence, a substantial part of the body politic may perceive an alternative identity conception as a more legitimate vehicle of self-determination. In Britain, ethnic Welshness, Englishness, and Scottishness are all politicized to a degree, but a clear hierarchy defers the ethnic to the civic, and places civic Britishness above all three. In Russia, by contrast, the civic ideal is barely accepted by the state leadership, let alone the population, and a huge number of different identity conceptions, each related to different territorial configurations, jostle for hierarchical supremacy, implicitly (or explicitly in Chechnya) challenging the legitimacy of both political authority and territorial borders. Identity conceptions in Russia operate at a variety of spatial scales; they can be primarily civic, ethnic, or regional but all have an integral territorial dimension. Some of those identity arenas, as illustrated in Figure 8, inhabit a space larger than the state, be they anti-national (for instance, global), supra-national (Orthodox, Islamic, or Soviet), or trans-national (Eastern-Slavic, Pan-Mongolian, or Eurasian). Others nestle within the boundaries of the state (sub-national), and may be intra-regional (Siberian or North Caucasian), singularly regional (Tatarstani or Muscovite), or subregional (Cherkess or Lezgin). Many of these identity conceptions crosscut one another and, to varying degrees, the boundaries of the Russian civic conception. The potential strength of ethnic identities in Russia had previously raised concerns that the Federation might collapse in a manner akin to the Soviet Union, and have reinforced the perception that ethnicity provides the crucial identity challenge to a Russian civic national idea. Indeed the threat to state cohesion and stability that non-Russian ethnic groups appear to pose undoubtedly played some role in the decentralized asymmetric federalism that developed under Yel’tsin. Constitutional asymmetry granted additional rights to the republics to determine their own form of state power (mostly elected but authoritarian presidents), adopt their own constitutions and laws, and so on, while a series of bilateral agreements further reinforced and codified this formal asymmetry and granted concessions in areas such as selfgovernment, tax and export contributions, natural resource ownership, selection of judiciary and procuracy, the stationing of conscripts, republican “citizenship,” and cultural-linguistic rights. All things being equal, it appeared that ethnicity, and more specifically republican status, could be used to win certain privileges and rights. However, the reality was (and is) of all things unequal, from economic capacities and resources (as detailed above), religiouscultural traditions, and ethnic and other demographics (see next section), to geographical location and elite relations. Among all these factors of asymmetry, institutionalized constitutional status based on ethnic self-determination was but one bargaining tool. Moreover, asymmetry abounded, not just between the republics and oblasts, but among the republics themselves. The fact that all republics were not party to bilateral treaties indicated that ethnicity alone was not the only issue. Rather economic factors figured heavily in Russian federal asymmetry and less impoverished regions, especially those possessing substantial natural resources, were able to win more concessions from the federal government. In particular, Tatarstan, Bashkortostan, and Sakha (Yakutia), all identified as resource regions in Table 3, each were able to use their economic strength to negotiate advantages denied to others. Fig. 8. Some possible identity alternatives in contemporary Russian space. The ellipse representing the Soviet identity arena could have been placed in a number of ways, cross-cutting virtually all other conceptions. BRADSHAW AND PRENDERGRAST 99 100 EURASIAN GEOGRAPHY AND ECONOMICS Nonetheless it is misleading to attribute too much importance to economic wealth. In the 1990s the most important republics were economically powerful not necessarily because of their wealth per se, but because of what they could threaten thereby in the name of an ethnocultural group. Ethno-nationalist issues were organically less dominant in some republics and less well mobilized by elites in others. Both factors made a difference. The ethnic card was less convincing a tool in republics such as Komi, Karelia, and Khakassia than in republics such as Tyva, Tatarstan, and most of those in the North Caucasus (now the Southern Federal District). Despite relative wealth, republics such as Komi and Karelia were able to extract few concessions because they simply did not pose a viable threat to cohesion that needed placating, whereas those republics that appeared most threatening economically (those that figure in Tables 2 and 3) and ethnically were bought off using bilateral treaties and interbudgetary transfers, encouraging the powerful republics back into the fold and maintaining state cohesion. Conversely, as the 1996 presidential election approached, fiscal appeasement was used less to protect state cohesion and more to keep Yel’tsin in the presidency, in a simple exchange of loyalty for money. With the benefit of hindsight, it is now clear that many of Russia’s present problems today stem from the arrangements crafted by Yel’tsin to stay in power, not just in terms of center-region relations, but the “loans for shares” deals that handed over strategic state assets to the oligarchs for a fraction of their true value. Putin’s approach, by contrast, even before the recent reforms, suggests that he does not feel it so necessary to appease the republics, nor the oligarchs for that matter. He has moved against both formal and informal asymmetries, but most notably against those republics that were powerful under Yel’tsin, retracting many accrued advantages by insisting on legal harmonization, retaking control of the fiscal purse strings, canceling or failing to renew all but a few bilateral treaties, and revoking many tax concessions in the process (for instance in Tatarstan and Bashkortostan). However, this is part of the wider “re-centralization” that has affected all of Russia’s regions. Putin seems nonetheless aware that high-profile leaders must be kept on side and has made efforts to rein them in while avoiding too much direct confrontation, primarily by building patronage relationships. In so doing Putin has sent the message that the ethnic card will not be directly rewarded.18 Putin thereby has prioritized stability (and control) over freedom and democracy, in particular where the latter could allow the revival of anti-Russian ethno-nationalism. Authoritarianism seems to be a lesser evil than ethno-nationalism, from the perspective of stability at least. In this regard it is questionable how much difference the reforms announced in the wake of Beslan will actually make, in the ethnic republics at least. To a large degree republican leaders are already effectively appointed by Putin, in that they have gained (or maintained office) in exchange for loyalty to the center. Allowing stable authoritarian elites—most notably in Kalmykia, Kabardino-Balkaria, North Ossetia, and Bashkortostan (Hahn, 2003, p. 116)—to retain power served Putin’s goal of stability well. The existence of wellestablished authoritarian leaderships, loyal to Putin, in potentially volatile ethnic republics, arguably went some substantial way toward containing the potential political impact of any ethno-centric backlash to Putin’s recentralizing efforts and his assault on republican sovereignty. This remains the case. If his goal is indeed stability, cohesion, and unity, Putin seems little more likely to risk destabilising either the Volga or the North Caucasian republics by 18Moscow, for example, has not shied away from provoking an angry reaction in the Volga republics, tackling controversial ethno-cultural issues such as bilingualism requirements for political office, Tatarstan’s adoption of the Latin script, and the legality of headscarves in passport photos. BRADSHAW AND PRENDERGRAST 101 removing well-established ethnic leaders now, than when he chose to allow them a third term rather than back alternative loyal but locally weaker candidates.19 Despite their usefulness in delivering votes (as demonstrated in the 2004 presidential elections; e.g., see Marsh et al., 2004), authoritarian enclaves (be they “elected” or appointed) in an ostensibly democratic state may not be effective in ensuring stability and cohesion in the longer term, a lesson Putin perhaps may have learned from his Soviet predecessors. Coincidently or not, the poorest regions of Russia often also are ethnic republics, and authoritarian leaderships tend not to be a recipe for the good governance. The socioeconomic hardships, restricted media freedom, and electoral manipulation (or a lack of electoral opportunity going forward) that so often characterize life in Russia’s republics would seem reasonable targets for ethno-nationalist and other opposition, as indeed they were during the later Soviet years. Half-hearted freedom and democracy have not proved a successful recipe for stability in Russia’s recent past, particularly in the context of ethnic distinctiveness. In the short term at least, Tatarstan and Bashkortostan, with their controllable, loyal, authoritarian elites do not appear willing (though they may yet be able) to threaten Russian stability and cohesion. Other republics may presently have a greater potential to do so, primarily those located on Russia’s periphery. A complex matrix of ethno-cultural, socioeconomic, and political factors coincide to destabilize Russia’s internal security and foreign relations, most notably in the Southern Federal District where economically weak, povertystricken, ethnically diverse, often Islamic, predominantly borderland republics are potentially volatile. These republics, with external borders and majority ethnic populations, tend to be the poorest in Russia, such that in Dagestan, Ingushetia, and Kalmykia more than 60 percent live below the subsistence level (Ross and Sakwa, 1999). Add to this that the North Caucasus republics face issues arising from the Chechen conflict (weapons proliferation, terrorism, refugees) not to mention those arising from international borders (illegal migration, drug trafficking, crime) and the likelihood of instability and potential volatility in the region seems clear. In an international climate focused predominantly on radical Islamic terrorism, volatility in a region where five of the most backward republics are titularly Islamic (Lavrov and Makushkin, 2001, p. xxiv) could have import far beyond Russia’s borders (as indeed have events in Beslan), impacting her international standing and giving these regions an importance not presently matched by Tatarstan and Bashkortostan. In addressing the cohesion problem, Putin has, it seems, learned from Yel’tsin’s mistakes. By coming down hard on those republics that were the most powerful under Yel’tsin, Putin has made it clear that status as an ethnic republic, being rich, being politically strong, having a consolidated and established leadership, even being Islamic20, is not sufficient to warrant preferential treatment. Rather he has sought to convey the message that status is a reward for loyalty and that he, not the republican chiefs, calls the shots. This reward for loyalty is simply made more explicit by recent reforms. Economically poor, ethnically and confessionally divided republics with more volatile elites are now the greater threat to Russia’s stability, and consequently it is these republics 19Ironically, this tactic too could misfire, since polling in Kalmykia and Tatarstan revealed that much of the popular support for Putin’s reforms stemmed from a desire for a forced change to the authoritarian republican leadership, which did not seem possible under the existing “democratic” electoral system (Coalson, 2004). 20There is seemingly less threat in attacking Tatar-Bashkir Islam since it combines Muslim canons with liberal ideas, and seeks to disassociate from the radical Islamicism, which is gaining a stronger foothold in the North Caucasus and in Chechnya. 102 EURASIAN GEOGRAPHY AND ECONOMICS that are targeted for advantageous treatment by the center. Because these republics are neither the wealthiest nor the most vocal, Putin has been able to allocate resources and favors to them using a nuanced approach, under the cover of fiscal redistribution, equalization, and poverty alleviation. By recentralizing fiscal finances, the federal government is able to redirect funds to the neediest republics in economic (and also stability) terms, without explicitly appearing to privilege ethnicity or Islam, and thus to contain some of the resentment of nonrepublican regions that was so evident in the 1990s. The concerns of economic welfare and preservation of national cohesion and political order now neatly coincide. The process of cultural rebirth in Tatarstan, Bashkortostan, Sakha, as well as in the North Caucasus and Siberia is substantial rather than merely functional, as witnessed in the expansion of titular language education, the ethno-centric rewriting of histories, disproportionate titular political representation, and positive discrimination mechanisms for public office, education, and industry. All in all these measures are serving to reinforce ethnic titular identities and encourage re-identification with the titular group.21 Efforts to limit ethnocentrism in certain republics may well increase tensions both within the republics and vis-àvis the center, as dissatisfaction develops with the limited ethnic or regional voice in a centralizing federation (Hahn, 2003, p. 149). Regional populations or elites may increasingly regard either ethnically exclusive identities or regional multi-ethnic identities as more legitimate bases for political authority than the central national version, particularly where they are excluded from participating in regional elections by the reforms. In such a context it is not hard to see how regional elites not in favor with the Kremlin might seek to maximize power and authority by appealing to anti-center regionalist or ethno-nationalist rhetoric, which will hardly reinforce stability, cohesion, or unity. In a Russian context whereby the current territorial configuration (i.e., the Russian Federation at present) appears to many of its citizens to be failing in terms of identity, authority, and efficacy22 it is not only identity conceptions built around exclusivist ethno-cultural markers that may provide alternative bases for political self-determination. Regional identities, associated with a myriad of spatial scales from local to continental (or even the global), may provide arenas of organization, mobilization, and governance. Despite its strong sense of ethnic identity, Tatarstan need not resolve its identity conundrum in favor of exclusivist ethno-national policies or ideals (Giuliano, 2000, p. 296). Indeed, its President Mintimer Shaimiyev, in outmaneuvering the ethno-nationalist elite, successfully reframed ethno-nationalist goals, building trans-ethnic support for republicanterritorial sovereignty and economic self-sufficiency by focusing on interests common to all members of an inclusively defined “national community of Tatarstan” (ibid, p. 312, and see also p. 308; Raviot, 1994, pp. 66, 71). What appears now to be emerging in Tatarstan, appropriately perhaps given the republic’s ethnic demographics, is a regional identity remarkably similar, in content if not scale, to that which the center is failing to cultivate on a Russia-wide basis. It is a broadly civic identity that seeks to avoid alienating the many ethnic peoples of the republic, while at the same time being built around markers that relate most closely to Tatar ethnicity, culture, language, and history. Perhaps because it is able to use Moscow as the “other,” the Tatar version seems better able to unify all its citizens at a 21Nationality data from the 2002 census reveal that the percentage of the population self-identifying as “Russian” declined in all but five of Russia’s republics. See the demographics section in this paper for further details. 22Identity, authority, and efficacy are the dimensions upon which the strength of the national territorial state depends for its legitimacy (Hassner as cited in Paasi, 2003, p.109). BRADSHAW AND PRENDERGRAST 103 regional level, than is the Russian version. At present this emergent Tatar civic regional identity is unconsolidated and the spatial extent of its political ambition uncertain. Figure 9 therefore displays a number of variations. Ethnic Tatars may view the region as homeland to Tatars dispersed throughout the Russian Federation and even beyond, or may see Kazan’ as a special historical center not just for ethnic Tatars or residents of Tatarstan but those in the entire Volga-Ural region, including peoples of Tatar, Bashkir, Russian, Chuvash, Mordovian, and Udmurt ethnicity. The latter conception concerns Bashkir ethno-nationalists and maintains an ethnic dimension in politics in the Volga-Ural region (Magomedov, 2001, pp. 15-16). Another emergent regional identity is apparent in Dagestan. As home to more than 30 ethno-linguistic groups, a myriad of potentially conflicting ethnic identity conceptions compete and yet Dagestan remains united administratively and vis-à-vis the center. Ware and Kisriev (most recently in Ware et al., 2003) have argued that ethnic diversity does not necessarily entail instability, and that the very intricacy of Dagestan’s ethnic structure has inhibited radicalism and encouraged the de-ethnification of politics (Ware and Kisriev, 2001, p. 106). Significantly, intra-Dagestani ethnic identities are superseded by a broader attachment to Dagestan23 as home to a collectivity of ethnic groups united by economic, political, and socio-cultural norms and methods of conflict resolution (Zuercher, 2000, pp. 20-21). They have also noted an increasing tendency in Dagestan, and perhaps in other North Caucasian republics, to present themselves monolithically in their dealings with the federal center, effectively subordinating ethnic, ideological, and political differences to the regional, in opposition to the national (Ware and Kisriev, 2001, p. 117). By contrast it can be argued that Dagestani allegiance to the Russian Federation owes more to practical realities than to cultural features. For many Dagestani citizens the most immediate threat to Dagestani security lies with Chechnya, not with the Russian Federation. Likewise, economic and material incentives tie the poverty-stricken Dagestan to the Federation and as such the continuation of loyalty to the federal center may depend to a significant extent on the degree to which the center is able to meet socio-economic as well as military security needs. Regional identities also may develop in non-republican regions, which do not necessarily have a titular or marked ethnic identity. Outside the republics, some of the most vocal support for regional autonomy has come from the Far East, and Primorskiy Kray in particular, reflecting its frontier position, historical traditions, economic requirements, and isolation from the center (in terms of distance, time, and living conditions). Historical factors combined with contemporary administrative and economic structures may encourage the development of broader regional identities within the Russian territory. The previously mentioned Tatarstani regional identity draws much from a civilizational idea of a broader “Volga-Urals” region, which has an organic heritage differing culturally, historically, and religiously from Russia (Magomedov, 2001, p. 21). Likewise calls for greater autonomy for Primorskiy Kray refer to the historical precedent of the Far Eastern Republic (1920–1922), which was based on non-ethnic cultural and economic distinctiveness. A broad Siberian regional identity has long existed, exhibiting a sense of “otherness” from the rest of Russia (Hughes, 1994, p. 1147) and based not only on economic motivations but on Siberian cultural distinctiveness and reflected in popular folkloric conceptions. This identity could again develop an overtly political dimension capable of inspiring fear of Siberian separatism, particularly as the 23Indeed survey data has revealed that a wholly ethnic identification is surprisingly weak in Dagestan and that three-quarters of those surveyed identified themselves primarily as Dagestani, compared to less than 15 percent who identified primarily by ethnicity (Ware et al., 2003, p.13). 104 EURASIAN GEOGRAPHY AND ECONOMICS population and elite moves westward and if the center fails to deliver solutions to Siberia’s socio-economic problems while at the same time benefiting from her resources. Moreover the administrative boundaries of the federal districts may help to consolidate regional identities, just as federal state structures consolidated ethno-territorial identities under Soviet rule. As inter-regional connections and inter-regional networks of interaction are constructed, regional linkages and thus identities can more easily develop, particularly where federal district boundaries align with broad trans-regional cultural identities, such as in most of the North Caucasus, in Siberia, and in the Far East.24 The Russian political space clearly remains fragmented and subject to competing ethnic and regional cultural identity conceptions that threaten to outpace the development of a Russian-wide civic national identity and to outrank that identity in terms of political legitimacy. Putin’s efforts to undermine the integrity of ethno-cultural distinctiveness as politically valuable, at the same time that he seeks to alleviate some of the socio-economic problems that create volatility in the poorest ethnic and Islamic regions, are hindered by his implicit support for a exclusivist, even militaristic, ethno-Russian nationalism and the continuing war in Chechnya. While sacrificing democracy to authoritarianism in the ethnic (particularly North Caucasian) republics may maintain control and stability over the short term, central ethno-nationalism combined with federal centralization in the context of reinforcing ethno-cultural identities in the republics is hardly a recipe for national unity, cohesion, or legitimacy in the longer term, and certainly not one appropriate to a supposedly liberal democracy. Add to this a failure to even consider the strength or potential of regionally constituted civic identity alternatives in both the increasingly fragmented heartland and the increasingly isolated peripheries and the challenge laid at the feet of a weak civic identity seems immense. DEMOGRAPHIC DIMENSIONS: REGIONAL ASPECTS OF RUSSIA’S DEMOGRAPHIC CRISIS Hooson, writing in the mid-1960s, noted that “the population on the land . . . comprising the Soviet Union [had] more than doubled in the [20th] century” (1964, p. 47). A similar trend is far from discernible at the start of the present century. The Russian population, rather than exhibiting an “average annual rate of population increase . . . almost identical to the North American rate and double that of most of Europe” (ibid.) became in 1992, the first in any country in the world to experience natural decline for reasons other than war, famine, or disease. The recently published 2002 census results revealed a total population numbering 145 million (see Heleniak, 2003b), some one million fewer than in 1989, while the most generous projections now anticipate a total population of 120 million by mid-century. Excepting the overtly spatial migratory variable, over-reliance on liberal demographic transition theory has, more often than not, obscured (or ignored) Russian demographic regional variation and focused instead on national-level universalizable trends. Yet, such national trends disguise significant spatial variance.25 Russia’s 89 federal subjects exhibit hugely divergent demographics in both population composition and dynamics, as evidenced in migration patterns, fertility trends, mortality patterns, age distributions, ethnic composition, 24Equally however, such horizontal integration could serve as a bulwark against disintegration of the federation. (Herd, 1998). 25As Rivkin-Fish (2003, p. 289) argues in his insightful anthropological critique of liberal demographic transition theory; see also Ioffe et al. (2001, p. 31). BRADSHAW AND PRENDERGRAST 105 Fig. 9. Population density in Russia’s regions in 2002. welfare provision, etc. Each is impacted by long-term and transition-influenced trends, be they environmental, social, historical, demographic, economic, or political. By training his eye on the Volga-Baikal zone, Hooson was able to draw out the disparity and difference that characterized those regions. Demographic processes now, as then, work in different ways in different places, with different consequences. Russia is a huge country with very low and very uneven population densities. The broad discrepancies in population distribution are clearly shown in Figure 9. The process of natural decline and migration patterns are reinforcing this unevenness, and regional populations are now shrinking (or growing) in a geographically uneven manner (Herd, 2002, p. 4). Only the Southern and Central federal districts recorded intercensal population growth (of 11.6 and 0.2 percent, respectively), while at the subject level, some 23 regions did so, topping 43 percent in Dagestan, and more than 10 percent in six others (Fig. 10).26 Population decline in excess of 10 percent was recorded in 23 regions, often in source regions for large-scale out-migration, such as in Siberia, the Far East, and the European North. Magadan and Chukotka registered 53 percent and 67 percent declines, respectively. Growth differentials also occur within regions to a substantial degree, in particular between rural and urban areas. A second population density map (Fig. 11) shows rayon-level densities on the same scale as those shown in Figure 10 and clearly indicates the level of variation, which is obscured at the regional level. Zooming in on the Southern Federal 26Among the latter group, Kabardino-Balkaria exhibited the highest rate of growth (20 percent), followed by Moscow city (17 percent), Stavropol (13 percent), North Ossetia (12 percent), Khanty-Mansi (12 percent), and Krasnodar (11 percent); Ingushestia also registered growth of roughly this magnitude, although the actual percentage is unknown. 106 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 10. Percentage change in population in Russia’s regions, 1989–2002. This map uses 1989 census figures adjusted to take into account information that has become available in the post-Soviet period (see Tolts, 2004). Fig. 11. Population density in Russia’s rayons in 2002. BRADSHAW AND PRENDERGRAST 107 Fig. 12. Population density in Russia’s Southern Federal District in 2002 (A) and percentage change in population density, 1989–2002 (B). District (Fig. 12) demonstrates intra-regional differentials in both population density and changes thereof.27 Migratory trends have been particularly complex in the Southern district, with non-ethnic regions (Krasnodar, Rostov, Stavropol’, and Volgograd) experiencing much greater inflows than the ethnic republics, and authoritarian Kalmykia and KabardinoBalkaria, substantial outflows. The war in Chechnya has sent large numbers of displaced persons to both Ingushetia and Dagestan. Migratory patterns and dynamics are most readily traced from the spatial perspective (Fig. 13). Internally the dominant migratory trend has been the much-noted migration from northern and eastern Russia westward and southward, effectively undoing the system of habitation cultivated by Soviet-era planners, which resulted in an overpopulated and overdeveloped periphery (Heleniak, 2003a, p. 337). Except for Chinese flows into the Far East, internal and external (both legal and illegal) in-migrants tend to head for the same destination regions, most notably to major urban centers in European Russia, which seem to afford the best living conditions and employment opportunities. Regions such as St. Petersburg, Rostov-na-Donu, and Volgograd have been major recipients, and it is estimated that as many as half of all migrants have settled in Moscow and Moscow Oblast (Herd, 2002, p. 22; 2003, p. 48). Many external in-migrants from the CIS states have also settled along Russia’s southern tier, bordering key departure states such as Kazakhstan and those in Transcaucasia (Heleniak, 1997, p. 90). Such movements have had a significant impact on the ethnic composition of the population in such regions. In terms of city growth rates, Hooson made much of the rapid growth rates of cities within the Volga-Baikal zone, but most of those in the eastern portion of this region have 27Similar maps for the other federal districts are available at the project website. See http:///www.le.ac.uk/ geography/research/RussianHeartland/index.html. 108 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 13. Net migration in Russia’s regions, 1993–2001, as a percentage of the 1993 population. Fig. 14. Population change in Russia’s major cities (over 100,000), 1989–2002. BRADSHAW AND PRENDERGRAST 109 Fig. 15. Population change in Russia’s major cities (over 100,000), 1979–1989. experienced population declines since 1989 (Fig. 14); substantial growth is noticeable in only some cities in European Russia, and in the North Caucasus, as well as in cities in the Volga region (the western end of Hooson’s heartland). Post-Soviet city growth trends already differ quite markedly from those in 1979–1989 (Fig. 15). Fertility rates exhibit pronounced regional variation as well (Fig. 16), although they are now less significant than in the 1960s and 1970s, when they ranged from an average of 1.4 children per woman in Moscow to 4.9 children in Dagestan. However, as the number of women aged 20–29 declines, especially from 2007 onwards, regional disparities may be increasingly important in determining population growth differentials, as certain regions experience sharper fertility declines than others. Spatial trends in mortality also can be identified (Fig. 17). Traditionally, mortality increases toward the north and east and is lower in the south and west. Harsher, more remote, colder regions tend to have lower life expectancies and economic structure and associated environmental conditions may also be relevant (i.e., environmental hazards may increase morbidity from cancers etc.). The 2002 map reveals that this pattern is still dominant, albeit with exceptions related to ethnicity, economic structures, and other factors. In terms of regional age structures, the population share above working age ranged from 6.5 percent to 26.7 percent at the level of Russia’s federation subjects in 2002 (Fig. 18). However, even in resource-rich regions of the Far East and Siberia, traditionally small elderly populations have increased substantially over the last decade, primarily due to higher rates of emigration among younger cohorts and a breakdown in the previous pattern of high labor turnover. In Yamal-Nenets, for example, the proportion of elderly population has increased from 2 percent to 6.5 percent since the mid-1990s, in Khanty-Mansi from 3.5 percent to 8 percent, and in Chukotka from 3 percent to 10 percent. 110 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 16. Total fertility rates in Russia’s regions in 2003 (79 federal subjects only). Perm’ includes the Komi-Permyak Autonomous Okrug (AO), Arkhangel’sk includes the Nenets AO, Tyumen’ includes the Khanty-Mansi and Yamal-Nenets AOs, Krasnoyarsk includes the Evenki and Taimyr AOs, Irkutsk includes the Ust-Orda Buryat AO, Chita includes Aga-Buryat AO, and Kamchatka includes the Koryak AO. No data are available for Chechnya. Transitional and relatively unstable states, such as Russia, have a great deal of potential for internal instability, and for demographic factors to reinforce that instability at the regional, if not also the national, level. Diverse demographic processes (i.e., migration-led or natural, growth or decline) interact with distinct pre-existing social, economic, political, and cultural conditions (i.e., differing age and ethnic structures or economic conditions) in each of Russia’s 89 regions with widely variable implications for regional (or sub- or interregional) character, potential, and significance.28 Demographic changes that alter the balance between population and economy are particularly associated with political instability and even violent conflict, although it is not always clear where the balance may lie. For example, while rapid city growth may have been an indicator of economic development and strength in the 1960s in Hooson’s Volga-Baikal zone, similar growth rates now in the poverty-stricken, high-unemployment Southern district may simply exacerbate the pre-existing mismatch between the regional labor supply and demand. Likewise, population decline in the Far North, while reflecting economic decline, may also indicate adaptation to market realities, and may encourage innovation and increased efficiency as the Soviet-era labor-intensive disequilibrium works its way out (Sutherland and Hanson, 2000, p. 76). 28For example, rapid population increases will impact a society with low economic growth and high unemployment very differently than one experiencing high economic growth and a labor shortage (Weiner and Stanton Russell, 2001, p. 3). BRADSHAW AND PRENDERGRAST 111 Fig. 17. Average life expectancy at birth in Russia’s regions in 2002. Regions have different capacities (be they societal, economic, administrative, etc.) and so may exhibit variations in their ability to cope with, for example, migration in-flows, which increase demand for housing, welfare and healthcare services; alter dependency ratios (Fig. 19); and increase unemployment and poverty rates. Regions may be in no position to adapt sufficiently or quickly to new challenges, particularly as social infrastructure and welfare funding are in part the product of regional economic strength, tax base, and reliance on federal transfers. Poorer regions in the south that have been receiving much of the migration, and also tend to have larger youth cohorts, will likely be least able to cope with the influx of people, either in terms of providing jobs or welfare. Regions bordering Chechnya, such as Ingushetia and Dagestan, which are among Russia’s poorest, have had additionally to care for tens of thousands of internally displaced persons. In such regions, demographic factors combined with economic and social problems may increase social polarization and reduce societal cohesion (Independent, 2002, p. 24). Likewise mortality and health profiles present regions with differential budget costs in terms of medical and welfare provision. Compared to many demographic trends that adversely affect the poorest Russian regions, HIV/AIDS incidence, and related drug use and higher crime rates, tend to be associated with more affluent regions (those that contribute the most to the national economy) and thus has the potential to hamper development in the more successful regional economies, by disproportionately affecting men of working age, reducing labor productivity, and reducing incentives for investment in human capital. Although HIV cases are now recorded in all of Russia’s 89 regions, only 10 regions account for more than 50 percent of all reported cases (Fig. 20). The 40 or so regions with very low levels of infection to date may, by contrast, be able to avoid epidemics and the associated economic and 112 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 18. Percentage of population above working age in Russia’s regions in 2002. Fig. 19. Total dependents per 1,000 persons of working age in Russia’s regions in 2002. BRADSHAW AND PRENDERGRAST 113 Fig. 20. Cumulative registered cases of HIV/AIDS to October 2002 in Russia’s regions (as per Feshbach, 2003, pp. 84-89). social costs if preventative measures are introduced rapidly, and provided the low registered levels do not simply reflect inadequacies in detection.29 Changing demographic profiles, in terms of age, sex, etc. may also alter regional (and potentially national) political balances. Whether a certain region is more open and reformoriented or inward-looking and protectionist, both economically and socio-culturally (in attitudes toward women, multiculturalism, sexual freedoms, etc.) should to some degree reflect the demographic and socio-economic profile of its electorate. Before the most recent presidential and parliamentary elections at least, Clem and Craumer (2000a, 2000b) had illustrated a statistical correlation between population characteristics, such as gender, age, and ethnicity and spatial variations in terms of turnout rates, party identification, issue positions, and voter choices (Sperling, 2002, p. 1). Interestingly the more conservative vote of the elderly has previously been manifested as support for the KPRF, but is increasingly being transferred to support for Putin, United Russia, and the extreme right (LDPR) (Heleniak, 2003a, p. 342). The general aging of the population could therefore push politics farther in a right-wing ethno-nationalist direction. Equally, increasingly differentiated age and ethnicity profiles may reinforce regional political disparities, manifested for example in an older, more conservative, more patriotic Russian core, and a younger, less conservative (possibly more liberal), non-nationalist (or non-Russian nationalist, at least) periphery. Traditionally, dramatic consequences for political cohesion and stability are anticipated where demographic processes engender changes in ethnic balances or increase the size of the youth cohort. A connection between large youth cohorts and protest and radicalism has plagued African nations in particular (Weiner and Stanton Russell, 2001, p. 8). In Russia, 29Cumulative figures to October 2002 indicated that some 42 regions had registered less than 400 cases, while 20 had registered less than 100, and 8 fewer than 20. In Nizhniy Novgorod, early intervention appeared to have successfully stabilized the local epidemic, although numbers have been increasing again recently (UNAIDS, 2003; Denissov and Sakevitch, 2004, p. 80). 114 EURASIAN GEOGRAPHY AND ECONOMICS Fig. 22. Percentage change in the share of ethnic Russians in Russia’s regions, 1989–2002. Republic, autonomous okrug, and (Jewish) autonomous oblast boundaries are outlined in black. despite her aging rather than youthful population, the size of the cohort itself may be less important than the degree to which that group is alienated and disenfranchised politically and socially. In this regard, large (and typically youthful) migrations to the cities in the south of the country and particularly the North Caucasus (as shown in Fig. 13), may concentrate relatively large cohorts of young adults in urban areas with high unemployment and poverty rates, provoking social dislocation, drug-use, and crime (Teitelbaum, 2001, p. 22). Hooson argued that the national significance of ethno-cultural heterogeneity had been “greatly exaggerated” (1964, p. 48), yet demographic factors with ethnic dimensions are perhaps the most likely to lead to political instability in some of Russia’s regions. Although data relating to nationality composition from the 2002 census must be treated with some caution, they do point to two concurrent and significant trends. First, faster growth rates among ethnic (especially Islamic) groups, natural population decline in many traditionally Russian regions, out-migration from the ethnic republics by ethnic Russians, as well as ethnic re-identification are all contributing to an increase in the concentration of ethnic groups in their home republics; this is causing some degree of un-mixing of Russia’s peoples, reinforcing the correlation between region and ethnicity. Of Russia’s 21 ethnic republics, all but five have since 1989 have registered a decline in the percentage of the population self-identifying its nationality as Russian (Fig. 21). Changes have been of significant magnitude in many republics30 and even in some autonomous okrugs.31 Such changes may alter regional political or labor balances, not to mention regional and national identity conceptions. The increasing homogenization of Russians and non-Russians within different regions (especially outside of European Russia) could leave increasingly 30For instance, in Ingushetia the percentage of the Russian population declined by some 12 percentage points to just over one percent, and in Tyva a 12 percentage-point decline reduced the percentage Russian from 32 percent to just over 20 percent. 31In the Koryak AO, ethnically divergent patterns of out-migration have left a local population which is 11 percentage points less Russian than in 1989. BRADSHAW AND PRENDERGRAST 115 concentrated ethnic minorities feeling disenfranchised from a national political stage, dominated by a Russian ethno-centric elite. There is already, for example, a major lack of central representation for the largest non-Russian groups and for the Muslim population in general (some 14 million citizens according to preliminary census results). Conversely, in some of Russia’s most populous and economically powerful central and southern European regions, demographic changes are producing increasingly multi-cultural populations—most obviously, in Moscow and St. Petersburg, which have both experienced a decline of between 4 and 5 percent in the share of Russians relative to non-Russians, but also in virtually all (not just the republican) regions in the southern and central federal districts, which is the traditional Russian core. This is potentially beneficial for the development of more inclusive identity conceptions. However, although research has suggested that ethnic Russians living in Muslim or Buddhist republics may be more tolerant (Oliker and CharlickPaley, 2002, p. 57), the reaction of ethnic Russians to non-Russian inflows into traditionally Russian areas has been less positive, and precariously low levels of inter-ethnic tolerance seem to greet both Chinese in-flows to the Far East and Central Asian (and even North Caucasian) inflows to European Russian cities (Alexseev, 2001, p. 6). The danger to territorial integrity of Far Eastern depopulation is perhaps the most discussed regional consequence from a security perspective related to Chinese military or “silent” demographic expansion; yet seems alarmist and far-fetched. More worrying is Russia’s military manpower shortage, due to declining age cohorts, and the poor health and educational level of conscripts. This threatens Russia’s combat capability, her ability to police borders effectively, and to continue with even current levels of deployment. Regional disparities already exist in conscription rates, due to health, drug use, and avoidance differentials. In the longer term, higher growth rates among non-Russian ethnic groups will probably increase non-Russian conscription levels proportionally, with possible related loyalty problems, particularly in light of some regional efforts to prevent their conscripts from serving in Chechnya. In multi-ethnic Russia, with her poorly established sense of civic identity and high degree of ethnic intolerance, migration flows and other demographic processes may have significant consequences not just for the strength of a region’s economy or the pressure on its social infrastructure, but for the very cohesion of the society and culture, for popular understandings of regional and national identity, and so for the state’s stability and sovereignty. In particular, the decline of the politically dominant ethnic Russian population, and the growth of relatively disenfranchised non-Russian (particularly Muslim) ethnic groups in some republics, may encourage protectionism among the former and radicalization of the latter, particularly in the context of nationalist central rhetoric, civil war in Chechnya, and rising terrorist activity, as well as the related increasingly widespread xenophobia amongst the ethnic Russian population. The exact direction of many demographic trends and their consequences are difficult to discern, and would be more easily so under prolonged economic, political, and social stability in Russia’s regions. Unfortunately, demographic (and other) disparities are presenting challenges in economic, social, and cultural spheres, which seem more likely to reinforce rather than reduce turmoil. This makes the required stability even more difficult to achieve. A NEW RUSSIAN HEARTLAND? DISCUSSION If Russia is to be governable and economically viable, it needs to “shrink” itself— not by divesting territory but by organizing its economy differently. The objective is 116 EURASIAN GEOGRAPHY AND ECONOMICS to reduce distance and create new connections. People will need to migrate westward on a large scale, and the large cities in the coldest and remote regions will have to downsize. The barriers to self-correction, however, are considerable. (Hill and Gaddy, 2003, p. 140) The purpose of this section is to place the findings of the current project within the wider context of current research on the geographical dimensions of Russia’s transformation and by doing so to identify some of the key geographical challenges that confront the Russian state. The first of those challenges we would describe as the Siberian dilemma. Forty years ago David Hooson concluded that the Soviet Union would be strengthened by the “easterly drift of industrial population.” In their recent book entitled The Siberian Curse, Fiona Hill and Clifford Gaddy (2003) suggest that, far from strengthening the Soviet Union, the way that Soviet planners went about developing the more remote regions of Siberia (understood here to include the Russian Far East) cost the State dearly and now places a major impediment to Russia’s sustainable economic recovery. Here it is not the place to dwell on the reasons why this might be the case. The Siberian dilemma refers to the fact that Siberia’s resources have largely bankrolled Russia’s recent economic performance; furthermore, most analysts suggest that Russia’s future international comparative advantage will remain in the production of resources. Thus, Russia needs to continue to develop Siberia. As Hill (2004b, p. 324) has noted, “Siberia holds just under 80 percent of Russia’s oil resources, 85 percent of its natural gas, 80 percent of its coal, similar amounts of precious metals and diamonds and a little over 40 percent of the nation’s timber resources.” In Hooson’s terms, Siberia, in an economic sense at least, is currently a significant component of Russia’s effective national territory. The problems lie in the way that Siberia was developed during the Soviet period, such that the dilemma is not just that Russia’s needs Siberia’s resources, but that it needs to find a new way of developing those resources, a way that is economically viable and ecologically sustainable. As Hill (2004b, p. 331) puts it: “This time the challenge is not how to open up Siberia and conquer it, but how to develop it on a new, sustainable basis for the future and wrest Russia free from Siberia’s past mis-development.” One thing that is certain is that this new model of Siberian development will be capitaland technology- rather than labor-intensive, a factor that will serve to amplify the imbalance between those regions that contribute to the national economy and those regions that house the bulk of Russia’s population. Hill and Gaddy (2003) have suggested that people will have to move, and as we have seen this is happening. However, the spatial readjustment they call for will more likely result from medium- and long-term differential population change; the population in the northern and eastern regions will be reduced by natural processes rather than a trans-continental mass migration, and future natural increase and in-migration will be concentrated in the European regions of the country. This is because many barriers to mobility remain and also because many people do not wish to leave those northern and eastern regions (e.g., Thompson, 2003), a fact that will impose considerable welfare costs on the state. The second and third challenges are closely related, and are best described as the Moscow effect and the missing millionaires. The first challenge relates to the increasingly dominant position occupied by Moscow in Russia’s economy, and the second to the overall structure of Russia’s urban hierarchy. As our analysis of the level of economic concentration has revealed, as a consequence of the processes of transformation Moscow has increased its level of dominance in economic terms. In 2002, Moscow City and Moscow Oblast combined, in other words the Moscow region, accounted for a mere 0.3 percent of Russia’s BRADSHAW AND PRENDERGRAST 117 territory, but 10.5 percent of its population, 24.7 percent of total GRP, 12.2 percent of the workforce, 10.7 percent of industrial production, 31.7 percent of retail trade turnover, 46.2 percent of foreign investment, 26.7 percent of exports, and 45.2 percent of imports (Goskomstat, 2003, pp. 38-39, 860-861). Moscow’s primacy is undoubtedly a reality, but it prominence is also exaggerated by the way economic activity is reported. Much of the economic activity reported above probably takes place outside of the Moscow region by companies that are headquartered in Moscow. Furthermore Moscow is the country’s primary entrepôt and therefore many of the goods purchased in the region are consumed elsewhere. Finally, the relative discrepancy between the shares of the population and workforce, on the one hand, and exports, on the other, suggests that practices such as transfer pricing serve to bolster the foreign economic activity of the city.32 Consequently, Moscow has a rather parasitic relationship with the resource regions, siphoning economic rent that should be returned to Siberia. There is nothing new in this; the Soviet monopoly over foreign trade produced much the same outcome. It is not particularly unusual for a capital city region to dominate its national economy, although it does present certain problems for the rest of the country. However, in Russia’s case, the situation is made more complex by the peculiarities of the country’s urban hierarchy. It has long been recognized that the Soviet system of central planning had a significant impact on the development of Russia’s cities, and recent analysis using Zipf’s rank-size rule has placed the Russian case in international context. Two recent studies (Hill and Gaddy, 2003, pp. 17-24 and World Bank, 2004, pp. 27-33) identify two issues of relevance to our analysis: first, that according to Zipf’s law Moscow and St. Petersburg are too small, and second, that Russia is missing a number of second-tier cities, what we have called the missing millionaires. According to the World Bank’s calculations (2004, p. 27), Moscow should have a population of 13 million (instead of 10.4 million) and St. Petersburg 7 million (instead of 4.7 million). This observation may seem to contradict our previous discussion of Moscow’s dominance, but the Moscow effect is more about economic dominance than demographic weight. The point is supported by the fact that its economic weight is particularly high given its share of population. With respect to the second issue, Hill and Gaddy (2003, pp. 18-19) observed: “Russia’s lack of urban areas between 1.5 and 4.0 millions is one of the most formal differences between the US and Russian urban structures . . . more than half of the U.S. population lives in urban agglomerations of more than one million people, fewer than 16 percent of Russians do.” The World Bank (2004, p. 27) concluded: “It seems that Russia is ‘missing’ a number of cities, i.e. large cities with populations between 1.5 and 4.0 millions. Compared with the benchmark of Zipf’s Law, Russia’s second tier cities are unusually small.” Furthermore, the World Bank (2004, p. 28) observed: “A comparison with the rest of the world shows that the standard and relatively small size of Russia’s second tier cities—or alternatively, the lack of agglomeration—is indeed unique to Russia.” The consequences for Russia’s economic development are clear when one considers that many of the second-tier cities that do exist are in the wrong place, in the Urals and Siberia. Furthermore, it is also apparent that urban agglomerations tend to offer the kind of environment most conducive to economic growth, a fact identified by the Aton (2004) study; thus Russia has a deficit of the kind of city-regions needed to generate new economic activity in the regions where they are most needed, 32For example, oil produced in Siberia is sold to holding companies in Moscow that then export it and record that activity locally as a service sector transaction. The profits from that transaction, if returned to Russia, are then retained and consumed in Moscow. 118 EURASIAN GEOGRAPHY AND ECONOMICS specifically European Russia. It is possible that the Moscow effect now casts a shadow across central Russia that makes it very difficult for competing centers to emerge, as witnessed by the relative underperformance of St. Petersburg. The fourth challenge is a result of the complex interaction of the economic, political, and demographic dimensions discussed above, namely Russia’s fragile borderlands. As a consequence of the collapse of the Soviet Union, at the end of 1991 27 of Russia’s regions suddenly became international frontiers of the Russian Federation (Nicholson, 1999, p. 49). Russia now has the world’s longest land border of 14,509 km and in total 35 of its regions share a frontier with 14 foreign states. The problem is not so much the extent of the border, although that is undoubtedly a challenge, but the fact that many of those border regions are demographically stressed and economically underdeveloped. This is particularly true of the southern border regions in the Southern, Volga, Urals, Siberian, and Far East districts. If that were not enough, these regions also include the majority of Russia’s ethnic republics. Thus, as the section on the political dimension made clear, the greatest threat to Russia’s territorial integrity does not come from the landlocked and resource-rich republics such as Tatarstan, Bashkortostan, and Sakha, but from the impoverished republics of the Southern Federal District. The fact that Russia’s borderlands comprise some of the country’s poorest regions does not bode well for the establishment of an effective border regime and has obvious implications for Russia’s neighbors. At the same time, the fact that Russia’s effective national territory is concentrated some distance from its borders might promote continental, insular attitudes toward international cooperation. For its neighbours, a border with Russia is more a problem than an opportunity. For example, there is little evidence that eastward expansion of the European Union will reinvigorate the European border regions of Russia. The final challenge questions the entire notion of a heterogeneous and contiguous heartland or core region. Instead of a major belt or zone identifiable as the effective national territory, the contemporary landscape is more an archipelago of islands of relative prosperity that contribute the bulk of the national economy. As Leslie Dienes (2002, p. 450) observed: “Geographically, economically, and socially, Russia today is an archipelago. The country’s integrated economy is entirely confined to a set of urban agglomerations plus a few more isolated cities and resource-extracting centers, separated by vast geographical space.” Instead of Hooson’s New Soviet Heartland with its core region, expanding Volga-Baykal region, and marginal areas, in Dienes’s “Archipelago Russia,” outside of the integrated economy is a vast “dead space.” This may be an overly pessimistic vision of contemporary Russia, but it does drive home just how dramatically things have changed as a consequence of Russia’s transformation. Today Russia is a fragmented state, and the mappings of the economic, political, and demographic dimensions presented here suggest a complex geographical reality that defies simple generalisation. There is no doubt that the Soviet system bequeathed a geography of population and economy ill suited to the needs of a market economy, but it is also clear that the actions during the 1990s more often than not made a bad situation worse. This begs the question what the Russian state can do now to ensure the cohesion of the Russian Federation. CONCLUSION: FRAGMENTATION AND CENTRALIZATION At the beginning of this analysis we evoked the European Union’s notion of “territorial cohesion.” That definition made clear the importance of “making both sectoral policies that have a spatial impact and regional policy more coherent” (European Commission, 2004, p. 27). By its own admission, the Russian Federal Government has a “passive” regional policy that is limited to modest transfers via the fiscal federal system. It does not have an BRADSHAW AND PRENDERGRAST 119 explicit regional development fund of the type used by the European Union, one that identifies particular types of problems and provides targeted funding to those regions that meet the criteria. The problem is that even if Russia did have such a policy, it is doubtful that it would be effective: first, because there is limited evidence that such policies actually make a difference; second, in Russia’s highly politicized federal system funds likely would be awarded as a political favor rather than on the basis of objective criteria; and third, because it is unlikely that the funds paid to regions would be put to good use. In any event, the absence of a regional development policy would not pose a serious problem if the central state were aware of its fallibilities and was prepared to use the market and the decentralization of public finances to enable regions to address their own problems and create the conditions for local democracy and economic growth. Although such a free market approach would also generate regional inequalities and regional problems, economic theory suggests that it would reward those regions trying to do the right thing in the right place, and were barriers to migration eliminated at the same time, people would be able to move to those prosperous regions. In such a situation, it appears inadvisable for the state to attempt to subsidize failing regions; instead, according to the World Bank (2004, pp. 35-37), social programs targeting people who stay on in depressed areas would prove more cost effective than economic development programs. Unfortunately, in Putin’s Russia the trend is toward increased centralization and direct state involvement in both the political and economic arenas. Today Russia’s regions have little freedom of action, even to do the wrong thing. Changes to the tax regime and the political system make political and economic elites increasingly dependent on Moscow. Thus we have the worst possible situation, a central state that is increasing its control over political and economy activity, yet is either unaware of the need, unwilling, or unable to address the growing threats to its territorial cohesion posed by the situation described in this analysis. This does not bode well for the future of the Russian Federation, or for the world more generally. The current economic recovery may turn out to be little more than a short-lived façade, and an opportunity missed. 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