BACKGROUND:During the course of an interview with the German magazine Der Spiegel in mid-2005, Russia’s deputy presidential chief of staff, Vladislav Surkov, expounded on the challenges facing his administration in the North Caucasus. Specifically, he identified the creation of jobs, the development of educational opportunities, and the advancement of youth outreach programs as priority tasks. Although this particular interview did not explain how Surkov and his colleagues planned to address these outstanding issues, a speech he subsequently made to a gathering of Russian businesspeople proved rather more revealing. Surkov used this opportunity to encourage his audience to forge closer ties with the Kremlin’s party of power, United Russia. Widely perceived as the political mastermind behind this party, Surkov eagerly talked up United Russia’s neo-liberal credentials, declaring a need “to focus on enhancing the liberal-orientated modern Europeanized wing of United Russia”. Notably, he also encouraged regional political leaders to embrace the party: “After all, a party is a team, and it is better to depend on a team than on a handful of aides”. This advice has not been heeded by certain political leaders in the North Caucasus, who are nevertheless ostensibly pro-Russian in their outlook. While most have publicly embraced the party, many have yet to take it to heart and prefer to appoint extra-party acquaintances to key positions as their aides and personal assistants. The conventional strictures of party politics – as considered from a western perspective – do not apply in the North Caucasus. In the final analysis, local branches of United Russia are seldom beholden to the party hierarchy. In fact, on occasion they have not been averse to committing what, in the eyes of Surkov, Boris Gryzlov (chairman of United Russia) and others, amounts to a cardinal sin: disloyalty to President Putin. For example, during the political mini-crisis which gripped Adygeya last April, the republican president, Khazret Sovmen, refused to accept an initiative by the Presidential Representative to the Southern Federal District, Dimitri Kozak, to quicken the process whereby Adygeya would be merged with neighbouring Krasnodar Krai. During the course of these events, the local branch of United Russia, which had previously been co-opted by Sovmen’s supporters, publicly endorsed the president’s recalcitrant stance. By thus opposing Kozak’s initiative, Sovmen and his party allies were in fact opposing President Putin – after all, by the very definition of his job title, Kozak is an executioner of the president’s will. This tendency of regional party structures to “go native” has also caused problems elsewhere for the Kremlin, and has been exacerbated by the absence of a clear mechanism for enforcing the party whip among regional cadres. For instance, when Ramzan Kadyrov moved to suspend the activities of the Danish Refugee Council in Chechnya last February – a risqué initiative with constitutional implications – he subsequently faced no censure from United Russia, apart from a mild injunction from Gryzlov to be more careful in future. IMPLICATIONS:What, therefore, does it say about the true extent of the party’s influence in the region, when a politician as injudicious as Ramzan Kadyrov is deemed suitable to head the Chechen branch of United Russia? Judging by remarks he made during his Annual Address to the Federal Assembly, President Putin agrees with Surkov that the promotion of private enterprise, not state investment, is the optimal means of improving the region’s socio-economic situation. However, it would be interesting to hear what potential investors make of a situation whereby the local structures of Russia’s de facto ruling party are essentially the playthings of entrenched local chieftains, solely preoccupied with enriching themselves and consolidating their grip on local power structures. The ideal neo-liberal economic scenario whereby government, be it of a national or a local character, assumes the impartial role of umpire between entrepreneurs, investors and competing businesses, simply does not exist in the North Caucasus. As Grozny’s recent parliamentary initiative, “On Special Conditions for Entrepreneurial Activity in the Territory of the Chechen Republic” made clear, Chechnya’s pro-Moscow government is of one mind with Putin and Surkov on this issue. This bill proposed turning Chechnya into a “free economic zone” in order to encourage outsiders to invest in the republic. However, an investor who does his or her homework – as most are wont to do – will quickly become familiar with Kadyrov’s long-standing reputation for extorting financial tribute from Chechen businesspeople. Even those who are already familiar with the unofficial conventions attached to doing business in Russia generally might bridle at the notion of paying Kadyrov “protection money”. Many will also baulk at the additional expense of employing the huge security retinues which will inevitably be required to protect their business interests on the ground. In a neo-liberal economy, one of the state’s key roles is to provide law and order. As yet, state structures have been unable to ensure these conditions in the North Caucasus. Indeed, the very structures that purport to uphold the law are often themselves involved in myriad criminal enterprises. Despite its status as a proclaimed champion of neo-liberal values, United Russia has failed to rein in those regional figures whose actions pre-empt the creation of a “level playing field” for businesspeople. Those brave enough to invest in the region will inevitably require local muscle to protect their interests; as such, they will most likely function as patrons for local militias rather than saviours of region’s increasingly destitute citizenry. Such a scenario harbours the familiar dimensions of the traditional Russian tactic of clientelage, albeit with a contemporary neo-liberal twist. CONCLUSIONS:It has previously been noted that the rise of the siloviki in contemporary Russian politics has been offset, if not overtaken, by the parallel rise of a resurgent business elite. On this point, Sharon Werning Rivera and David W. Rivera observed in a recent article in Post-Soviet Affairs that, contrary to common perception, Russia’s current political elite is “considerably more bourgeois than militocratic”. Surkov and United Russia are the established political patrons of the former constituency; however, they are presently encouraging Russia’s business community to invest in the North Caucasus although they – as representatives of the state apparatus – have singularly failed to uphold their end of the neo-liberal bargain by establishing a functional system of law and order in the region. As a result, in order to invest successfully in the North Caucasus, businesspeople will be obliged – by default, as it were – to fulfil a role theoretically reserved for the state’s law enforcement agencies. The resulting prospect of outside investors hurrying to employ local paramilitary outfits for protection purposes threatens to further stimulate the most salient causes of the region’s socio-economic ills – corruption, commercially-motivated violence and abuse of political power. AUTHOR’S BIO: Kevin Daniel Leahy holds a postgraduate degree in International Relations from University College Cork, Ireland.