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UC Berkeley Electronic Theses and Dissertations UC Berkeley UC Berkeley Electronic Theses and Dissertations Title From well to welfare: social spending in mineral-rich post-Soviet states Permalink https://escholarship.org/uc/item/2m23n81t Author McCullaugh, Marcy Elisabeth Publication Date 2013 Peer reviewed|Thesis/dissertation eScholarship.org Powered by the California Digital Library University of California From Well to Welfare: Social Spending in Mineral-Rich Post-Soviet States By Marcy Elisabeth McCullaugh A dissertation submitted in partial satisfaction of the requirements for the degree of Doctor of Philosophy in Political Science in the Graduate Division of the University of California, Berkeley Committee in Charge: Professor M. Steven Fish, Chair Professor Steven Vogel Professor Jason Wittenberg Professor Michael Watts Fall 2013 Copyright 2013 by Marcy Elisabeth McCullaugh All rights reserved. Abstract From Well to Welfare: Social Spending in Mineral-Rich Post-Soviet States By Marcy Elisabeth McCullaugh Doctor of Philosophy in Political Science University of California, Berkeley Professor M. Steven Fish, Chair Why do some autocrats redistribute resource rents through high welfare spending, while others do not? Conventional wisdom suggests that authoritarian leaders unconstrained by institutions and with unlimited access to resource wealth would siphon off these funds for themselves and rent-seeking elites at the expense of delivering goods to citizens. Yet, welfare spending levels among the world’s petroleum-rich authoritarian and hybrid regimes indicate that some rulers are more inclined than others to “share the loot” with the larger citizenry. This dissertation provides a theory of redistributive social spending in mineral-rich authoritarian regimes, using the cases of Russia, Kazakhstan and Azerbaijan. I analyze health, education and social security spending in each country from 2000-present, leveraging variation across cases as well as within each case over time. In Azerbaijan under Heidar Aliev (1995- 2003) and Ilham Aliev (2003-present), there is little evidence of desire on the part of the government to engage in redistribution. Welfare expenditures have remained consistently low as a percentage of GDP and decreased drastically over time as a percentage of total government spending. By contrast, welfare expenditures in Russia under Vladimir Putin (2000-present) have increased substantially since the early 2000s, driven largely by new social policy initiatives aimed at increasing pensions, salaries for health and education workers, and expanding categories for direct cash transfers and benefits to citizens. Finally, Kazakhstan under Nursultan Nazarbaev (1991-present) occupies a middle position between these two extremes. I find that variation in social spending is explained by differences in elite cohesion. Different degrees of unity and conflict among political and economic elites affect the autocrat’s sense of security about his position. When elites are divided, the level of threat to the autocrat is high. In order to counterbalance this threat and guarantee security, the autocrat buys the loyalty of allies in society through high social spending. The public becomes an important beneficiary of the redistribution of resource rents, and provides the autocrat with legitimate support. The autocrat then leverages this societal allegiance to deter threats by potential opponents. Conversely, when the elite is unified, the level of threat to the autocrat is low. In the absence of potential challenges from within the elite, the autocrat does not depend on societal allies to ensure the continued stability of his position, so welfare spending remains low. Due to the broad empirical and theoretical significance of redistribution under authoritarianism, this explanatory approach makes both substantive and theoretical contributions to the study of authoritarianism and the “resource curse,” and is applicable to mineral-rich non-democratic regimes in the Middle East, North and sub-Saharan Africa and Latin America. 1 For my mom, a fearless traveler to the far reaches of Central Asia and my unlimited source of strength and support. i Contents Acknowledgements page iii List of Tables v List of Figures vii 1 Redistributive Social Spending under Authoritarianism and Plenty 1 2 The ATM Autocrat: Rent Redistribution in Putin’s Russia 43 3 Typical Tin-Pots: Wealth Without Welfare in Azerbaijan 85 4 Vulnerable Stability on the Steppe: Modest Welfare Effort in Kazakhstan 120 5 Redistribution Revisited: Taking Society Seriously 157 Bibliography 174 Appendix A List of Author’s Interviews 184 Appendix B List of Conferences and Meetings Attended 188 ii Acknowledgements I have yet to find out whether it takes a village to raise a child. I can say, with absolute confidence, that it takes a network of mentors, colleagues, friends and family to write a dissertation. This dissertation is the product of a network that extends from California to Kazakhstan, with several stops in the middle. First, I want to thank the most critical academic influences on this work—Steve Fish, Steve Vogel, Jason Wittenberg, and Michael Watts—who formed my dissertation committee at the University of California at Berkeley. In particular, I want to single out Steve Fish, who peaked my interest in the politics of resource-rich countries during my first year at Berkeley. His excitement and enthusiasm for this project—as well as my general fascination with Central Asian dictators—inspired this study from beginning to end. I could not have developed my core theory without our brainstorming sessions, nor fine-tuned my argument without his advice and critique. Steve also made my life as a dissertation writer a lot easier because he thinks I am right, and pushed me to express my ideas with confidence, clarity and gusto. Steve Vogel deserves all the credit for my initial interest in redistribution and the welfare state. His seminar on comparative political economy was the best course I took at Berkeley, in part because he teaches his students from the very beginning of their graduate school careers how to craft well structured research designs. I carried that learning with me as I developed my prospectus, wrote grant proposals and drafted chapters. I am grateful to Steve for encouraging me to think through complex design issues, focus on the “big picture,” and write my dissertation with the narrative flow of a book. I also want to thank the third core member of my dissertation committee, Jason Wittenberg, whose meticulous attention to detail substantially elevated the quality of my work. Jason chaired my prospectus committee, and once I passed my defense, he asked me to turn in a revised version of my dissertation proposal. I am certain I would not have secured the funding I received for this project without that interim step. Jason asked the toughest questions I received while developing and writing my dissertation and, while there are still plenty of holes that need filling, the gaps are far fewer because of his intense scrutiny. Finally, Michael Watts’ perspective as a geographer and his extensive field experience in Nigeria inspired me to think through applicable case studies beyond the former Soviet Union. My research for this project took me to the far corners of the earth, including the barren steppe, Iranian border, and the outskirts of the Arctic Circle. I started in Almaty, Kazakhstan in August 2010, flew west over the Caspian Sea to Baku, Azerbaijan four months later, and landed in the Russian metropolis of Moscow in April 2011. I am forever indebted to the people I met on my journey, and this dissertation would not have been possible without their kindness, support, intellectual engagement, and willingness to spend $8 on real espresso drinks. Without Artem Baturin and Parvana Persiani, my research assistants in Almaty and Baku, respectively, I would not have secured as many interviews in Kazakhstan and Azerbaijan, nor been able to navigate the intricacies of elite networks as successfully. Much gratitude is due to my two dear friends in Almaty, Alissa Bespalova and Rhys Gonsalves Williams, without whom days would have been much harder and nights would have been much longer. I arrived in Baku in the depths of a dark winter, but managed to get plugged into a large social network within 24 hours. I was extremely fortunate to have the companionship of several U.S. scholars and international development workers, particularly Michelle Brady, Sara Brinegar, Eli Feiman, Leah Feldman, Krista Goff, Aleksei Lund and Amy Petersen. In addition, my time iii in Azerbaijan would have been a lot less fun without Kent Babin, Sarah Hennessey and Colonel Mustard. Sara, Eli, Leah, Krista, Aleksei and I formed a core group of graduate students who all experienced the trials and tribulations of conducting research in a challenging environment. Michelle kept us all sane, and Amy and I shared a home away from home. Sara Brinegar followed me to Moscow shortly after I arrived there and lived with me all summer. I could not have asked for a better roommate, friend, or summer fitness guru, and I owe my final burst of productivity in Moscow to her. In addition to Sara, Krista and Aleksei, several other Russian and Soviet historians I met at the Foreign Historian’s Conference in Moscow, particularly Seth Bernstein, pushed me to conceive of my project beyond the bounds of political science, which has made the final product more accessible to a broader audience. Finally, I would be remiss not to acknowledge the Fulbright-Hays Doctoral Dissertation Research Abroad (DDRA) Program and the Social Science Research Council International Dissertation Research Fellowship (IDRF), which both funded my research. Graduate school would be a much more disheartening experience without one’s colleagues in misery. I had the great fortune of making friends across Berkeley, including Sarah Garding, Jody LaPorte, Danielle Lussier, Ivo Plsek, and Regine Spector, who read many drafts of many grant proposals, listened to me babble as my ideas were germinating, and made sure I had fun once in a while. I especially want to thank Sarah Garding, who shared an office with me on the third floor of Barrows Hall for two years.
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