This issue's material on the electrical energy sector provides
an important insight on how this country's economy really works. In a world
of mutual indebtedness and barter transactions those who control energy
usually wind up with the goods which are exported for money that hardly
ever makes it back to Ukraine. With both fossil fuels and electricity the
National Security and Defense Council and its secretary Volodymyr Horbulin
(acting in strict conformity with the President's wishes no doubt) decide
who gets monopoly rights to sell how much energy to whom and thus who gets
how big a share at the feedbag. If someone like former Premier Pavlo Lazarenko
gets out of line, he is simply excluded from the party, as happened, for
example, when Unified Energy Systems of Ukraine was cut out of the natural
gas trade. The money winding up with whom the state sees fit is not reinvested
in even keeping the system at its current level, and it simply degrades.
Degradation is perhaps the hallmark of the whole process, that and the
feeling of fatality overshadowing it all. Remember last week's interview
with Vasyl Volha? Even I was shocked when he recalled the words of the
enforcers sent by one highly placed official: "Nobody can save Ukraine,
not now. If we don't take what we want today, somebody else will take it
tomorrow."
If even the people running a country have no faith in it, how can its
ordinary citizens have more? This virtually universal lack of faith is
almost as tragic as the cynicism and dysfunctionality causing it. It is
time for someone to stand up and say that it does not have to be that way.
We can change things and not in the way Comrades Symonenko, Tkachenko,
Moroz, or the other members of the back-to-the-future crowd would like
to. This country is sinking under the weight of its own state; it has more
state structures, employees, and functions than its economy can support.
That makes everybody run away from the state as far into the shadows as
possible, promotes disinvestment instead of investment, and means that
there is so much law and regulation that virtually everybody is to some
extent a criminal. It is not only in Russia that the middle class has become
thoroughly criminalized. Where something can be hung and virtually everybody,
it means that those in power can always do a little digging and shut down
virtually anyone or anything. In other words, too much law leads to lawlessness
as sure as too much state leads to the virtually reality state where bribes
are far more important than a bureaucrat's official pay envelope and the
state itself can neither pay its bills nor adequately fulfill such indispensable
functions as law enforcement and national defense. Things cannot go on
this way forever. Not even a people as trained to submission as citizens
of the former Soviet Union will tolerate such idiocy forever. The only
question is in what direction their frustration will be channeled.






