How to characterise the Putin regime, a now shaken and besieged ruling group sometimes said to be the richest in the history of the world? ‘Soft authoritarianism’, ‘hybrid regime’, ‘managed democracy’: the labels reveal less about Russia than about the inability of commentators to loosen the Cold War’s lingering hold on their thinking.

Luke Harding was the Guardian correspondent in Russia between 2007 and 2011 who last February was turned back at Domodedovo Airport and told that his presence in the country was no longer welcome. An editorial in the Guardian described it as ‘the first removal of a British staff journalist from the country since the end of the Cold War’. Harding himself sees his account of Putin’s Russia as a kind of codicil to Malcolm Muggeridge’s denunciation of the Soviet Union when he was the Manchester Guardian’s correspondent in 1932-33. ‘Eight decades on,’ Harding writes, ‘not much has changed’: ‘Kremlinology is back’; Russia ‘has become the world’s foremost spy-state’; ‘KGB habits of secrecy’ have returned; ‘Russia’s state media are still stuck in Cold War battle mode.’ And so on. Harding is not alone in this view. But it’s wrong. Putin doesn’t represent a return to Soviet ways; it’s something very different and more anarchic.

Putin’s clumsily announced but not unexpected decision to have himself re-elected to the presidency provides a clue about the way the system works, or rather doesn’t. If you take it that a credible succession formula is one of the key components of any political system, Putin’s stage-managed self-coronation makes it clear that Russia doesn’t have one. To leave the decision about one’s successor to the unpredictable outcome of a genuinely competitive election is acceptable only when incumbents don’t expect to lose too much if they lose. In established democracies, soft landings await electorally ousted politicians. In non-democratic systems, former rulers can sidestep unwelcome surprises if the succession process is managed by a core group within a ruling party, as in the Soviet Union after Stalin and in China today. But this alternative is not available in Russia. For one thing, the increasingly unpopular Yedinaya Rossiya is not an organised governing party but a ramshackle vote-rigging machine run by Putin loyalists and opportunists whom no one, least of all Putin, would trust to choose the country’s next ruler.

Giving up power now would cost Putin too much. Once he leaves, he will be in the dock – it’s inevitable, Harding is told by Stanislav Belkovsky, a former speechwriter for Boris Berezovsky. That, Belkovsky said, is when he’ll face the question of how to legalise his funds, and all his friends’ funds and assets in the West. Yeltsin, too, might have prolonged his presidency had it not been for his ill-health, but he was lucky enough to have Putin in place, not to bury the Yeltsin system, but to save it. Dmitry Medvedev, the cardboard dauphin, obviously couldn’t do for Putin what Putin did for Yeltsin. Putin’s decision to return to the Kremlin reveals not the strength but the weakness of the system he has built.

Putin’s remaining supporters constantly trumpet the ‘stability’ he has brought to Russia. But no system, much less this one, can be stable if it depends on the well-being and survival of one man. Even if his ‘physical capabilities’, as he boasts, far exceed those of any postwar Soviet leader, the regime’s principal institutions are hollow. The most striking illustration of the negligible role they play in Russian political life is not the rubber-stamp Duma but the presidency itself. Assigned nearly unchecked powers by the 1993 Yeltsin constitution, the office lost both its authority over foreign policy and the power to dismiss the prime minister when its shell was rented out for four years to Medvedev, whose inability to hold on to the job makes it clear that the presidency itself is not a source of power.

The Putin system has nothing to do with the ‘authoritarian DNA’ invoked by Sovietologists to explain the recurrent suppression of liberal developments. The singularity of Putin’s Russia is a consequence of the bureaucratic fragmentation that followed the break-up of the Party in 1991, the siphoning into foreign bank accounts of money from the state treasury and state-controlled firms by rival bureaucratic and business factions, the continuing absence of socially legitimate owners of what were once state properties, the corruption of officialdom at all levels, the gap between rich and poor, the anaemic sense of national identity among the country’s political and economic elite.

The most common misapprehension about post-Communist Russia, accepted by both the regime’s supporters and its critics, is that Putin has created a military-style structure of command. In fact, he has had neither the capacity nor the ambition to rebuild a Soviet-style hierarchy. Harding writes of the transition ‘from the chaos but relative freedoms of the Yeltsin years to the “managed democracy” of the vertical Putin epoch’ and cites Valter Litvinenko, Aleksandr Litvinenko’s father: ‘Russia is a vertical system. It’s like the Soviet Union. Only Putin can decide these questions, just like Stalin. Without Putin’s approval it’ – his son’s poisoning – ‘could not have happened.’ But although it’s undeniable that ‘state irritants are murdered as a direct result of their professional activities,’ it’s far from clear that the killing of journalists and lawyers with a social conscience requires Putin’s initiative.

That the much publicised vertical power structure is a ‘fiction’, as it was called by Aleksei Navalny, one of the instigators of the massive anti-regime demonstrations that took place on 10 December, is evident from the corruption which, according to Harding, ‘has increased sixfold under Putin’s rule’. Escaping the draft, registering a company, buying an apartment, getting into school, passing an exam, being acquitted of criminal charges, trumped up or valid, receiving medical treatment may all require the bribery of public officials. The kickback plague is endemic, inflating by as much as 50 per cent the cost to the state of everything from weapons to highway construction. That the principal players in ‘the greatest corruption story in human history’, as the economist Anders Aslund puts it, include the fabled siloviki – the ‘heavies’: the army, the intelligence agencies etc – is the strongest sign of the absence of a hierarchy. In a hierarchy, local officials would answer to their Moscow superiors: but they don’t.

If there is a vertical in Putin’s Russia, it is a vertical of impunity. If you are an officer in the FSB moonlighting as a hired hitman you can kill someone and nothing will happen. The routine failure to solve homicide cases and prosecute murderers, far from signalling overwhelming state power, reveals quite the opposite. ‘Putin’s system of loyalty is highly dependent on the ability of his army of bureaucrats to embezzle and take bribes,’ says the editor of the Moscow Times, quoted by Harding. Putin can’t compel public sector employees to stop embezzling and extorting, any more than he can force government officials to put their departmental responsibilities before their personal cupidity and commit themselves to their community’s well-being.

As one of the authors of the Guardian’s book on the WikiLeaks trove, Harding was nicely positioned to cull material about ‘the corrupt nexus at the heart of the Russian state’. He cites a report by John Beyrle, the US ambassador to Moscow, who wrote that ‘police and MVD collect money from small businesses while the FSB collects from big businesses.’ But even when they amiably divide up the turf, the members of various agencies are doing so for their own individual purposes, not as part of a common project. The leaked cables also include the allegation that ‘the government operates more as a kleptocracy than a government.’ As Harding summarises it, the Kremlin is ‘a private-sector money-making business in which stealing is a pathological habit’, standing at the head of ‘a dysfunctional political system … in which it is often hard to distinguish between the activities of government and organised crime’. The FSB is described as ‘in essence, a criminal organisation, offering protection to gangsters and extorting bribes from large businesses’.

None of this is entirely wrong, but the historically unprecedented nature of the Putin system comes into focus only when we remember, as Harding himself urges us to, that ‘the Soviet-era KGB was subordinate to the political will of the Communist Party.’ When the CPSU collapsed, it left behind not only the FSB and its associated agencies but a constellation of other ‘orphans’, highly developed and now essentially autonomous fragments of a defunct state. In a desperate but ultimately successful endeavour to survive in an unforgiving environment, various former subsidiaries went in search of new sponsors. Soviet psychiatric facilities, for example, that were once used to torment dissidents, now receive cash-filled envelopes from younger Russians eager to dislodge elderly in-laws from desirable apartments. More significant politically are entities like Gazprom, the former Soviet Ministry of Gas, now a huge non-transparent corporation in which the Russian government holds a controlling stake, and the Procuracy, which retains its formal prosecutorial functions but no longer has to answer to a ranking organisation – appropriate payment by private parties can be enough to initiate or suspend a prosecution.

Despite his own many unpleasant encounters with the FSB, Harding doubts that ‘the security and law enforcement services belong in Putin’s domain’ or ‘that they follow his orders’ – ‘they enjoy near total autonomy.’ That several autonomous agencies will trip over one another’s feet is only natural. The Foreign Ministry was embarrassed by the FSB’s surprise decision to expel Harding because it was announced on the eve of a visit to London by the Russian foreign minister. ‘These are the kind of things,’ Harding writes, ‘that are supposed to have disappeared from Putin’s rational, vertical, Prussian-style state.’ That they have not disappeared is evidence that there is no rational, vertical, Prussian-style state.

From multiple sources, including personal observation, Harding infers that across Moscow ‘FSB agents are actively picking locks, hiding bugs, skulking in stairwells, and using the flats of patriotic neighbours to spy on targets.’ But who is telling them to? And to what end? The most plausible answer is that Big Brother has lost his bearings. Plagued by ‘incompetence, muddle and disorder’, the organisation’s street-level operatives mindlessly apply textbook tactics without strategic guidance from above. Peeking into the FSB’s cabinet of cloaks and daggers, Harding discovers hapless spooks who seem to have strayed off the set of a Cold War play that, unknown to them, was mothballed two decades ago. They certainly aren’t on a mission to preserve the Kremlin’s domination of the country: they have simply inherited ‘tradecraft’ and have no clue what else to do. The quality of new recruits is abysmally low. Senior officers were apparently ‘unimpressed’ by the ‘messy’ way Litvinenko’s assassination was carried out. The KGB had done these things ‘more efficiently and tidily under Yuri Andropov’. The FSB’s record at fighting terrorism is equally poor – perhaps because they’re too busy extorting money from big business.

A similar story of disarray was revealed in 2010 by the arrest of the ten ‘spies’ deployed in the US by the Foreign Intelligence Service, a spin-off from the KGB: ‘The 55-page FBI dossier reveals in humiliating detail the frequently amateurish and bungling behaviour of Moscow’s agents in America,’ Harding wrote at the time. Here was post-Communist Russia in a nutshell: the operation that deployed the would-be femme fatale Anna Chapman as a clandestine operative ‘looked’, Harding writes, ‘like a job-creation exercise for the well-connected offspring of Russia’s elite. (Chapman’s father is a high-ranking “foreign service” official.)’

Examples of this sort suggest that as institutional loyalties recede kin loyalties naturally replace them. The privatisation of estates in the exclusive Rublyovka district west of Moscow is another illustration of the pattern. ‘In Soviet times,’ Harding writes, ‘KGB generals were allocated properties in the area, but had to vacate them when they retired from the service.’ The FSB generals who received land free from the state in 2003 and 2004 received it in their own names and so were able to bequeath it to their biological heirs rather than having to surrender it to successors recruited, with minimal regard to kinship, by an impersonal government bureaucracy. The pervasive role of nepotism in the distribution of both public property and financially exploitable positions in government and state-controlled enterprises is a sign of the institutional corrosion of the system.

The chronic power struggle within the Kremlin should also be understood in this context. In October 2007, the FSB arrested General Aleksandr Bulbov, the deputy head of the Federal Drugs Agency: Harding describes ‘a surreal standoff between his personal bodyguards and FSB agents, who waggle their machine guns at each other’. But what are such potentially deadly squabbles about? They boil down to bureaucratic-business clans attempting to wrest lucrative assets from one another. Behind the mask of an authoritarian restoration, we find the reality of intra-elite raiderstvo, a lawless feeding frenzy in which the various groups fight to grab their portion of massive cash flows. That the principal battle within the governing elite today pits liberal reformers against hardline siloviki is a misperception. The fabled bulldogs fighting under the carpet are not principled liberals at odds with rapacious strongmen. There aren’t two factions but more than a dozen, and their differences have nothing to do with ideology. ‘There are certainly no liberals or siloviki,’ Belkovsky assures Harding. ‘It isn’t a liberal/siloviki conflict. It’s about money and security, and providing security for their money. Nothing more. They are business competitors with the same purposes and goals.’

If such accounts are correct, libido habendi explains Moscow’s behaviour over the past decade much better than libido dominandi. The ‘neo-Soviet image’ projected onto Putin’s Russia casually skips over the biographical detail that Putin himself is a ‘classic post-Soviet businessman’ whose outlook was shaped while working in the mayor of St Petersburg’s office in the mafia-and-crime-ridden early 1990s. Formulated in more general terms, the Party of Cash has ingested the Party of Blood.

Blood continues to flow in the North Caucasus. But this is hardly proof of the Kremlin’s steely grip on the country. So we are left with the various killings that have earned Putin’s Russia a reputation for brutality. What we need to ask is whether the brazen homicides of meddlesome citizens reflect a hierarchy of power or its absence. Aleksandr Litvinenko could have been murdered by a group of former or serving FSB agents, Harding writes, ‘acting on their own initiative to get rid of a troublesome traitor’. Sergei Magnitsky was certainly done to death by the ‘same officials’ he had exposed for committing tax fraud. Even if FSB agents were involved in the broad-daylight killing of the human rights lawyer, Stanislav Markelov, they may well have been hiring themselves out after hours, perhaps to friends of Colonel Yuri Budanov, the Russian nationalist idol convicted of strangling an 18-year-old Chechen girl. (In his last press conference, Markelov announced that he was appealing the decision to give Budanov parole.) And so on. About his own harassment at the hands of the FSB, Harding says: ‘It’s possible that a billionaire individual unhappy with something I’d written about his business affairs may simply have paid the FSB to chuck me out.’

But doesn’t state control of national television, at least, provide evidence of Putin’s authoritarian ambitions? Much could be said about the not entirely democratic role of privately owned television in the oligarch wars of the 1990s and the self-serving attempt by magnates like Vladimir Gusinsky to paint themselves as defenders of liberty against authoritarianism. But the purposes of censorship under Putin are different from those of the Soviet regime. The journalists who get into trouble are those writing ‘about the links between the FSB and the mafia, and publishing stories about Putin and his team and the money of his team’. So long as you stay away from ‘sensitive issues, such as corruption among top officials’, you will probably be left alone, although outright mockery of top officials on national television is also forbidden.

Broadcast clips of an inebriated Yeltsin in the 1990s suggested that his government was too weak to intimidate its critics into respectful self-censorship. Because ‘never show weakness’ is the most pressing imperative of any chronically insecure regime, the Putin government decided to do what took minimal effort: seize control of the principal platform on which the government’s many shortcomings could be displayed. The Kremlin has monopolised nationwide television news not in order to impose a party line or because it hopes to persuade a cynical and disillusioned public to swallow the official version of events, but because it fears what might follow if the regime’s critics are seen to get away with disclosing the criminality and ridiculing the folly of the country’s ruling circles on national TV. The role played by the internet and social media in the aftermath of the 4 December elections, however, suggests that total control of TV broadcasts can no longer insulate the regime from mockery and the mobilising effects of anti-corruption exposés.

The potted neo-Soviet storyline also distracts attention from what is most crucial about contemporary Russia: the stark divisions between the haves and the have-nots. The instability and squalor of ‘a rich country full of poor people’ are papered over by upbeat statistics about per capita GDP and household consumption which notoriously omit any reference to inequality, mortality, morbidity, environmental degradation or the wasting away of public infrastructure and public services. Putin’s system, Harding writes, has created ‘the most unequal society in Russia’s history’.

To keep the have-nots at arm’s length, the wealthiest Russians live in exclusive, walled-off residential compounds like those along the Rublyovo-Uspenskoye Road outside Moscow. But since the highest fliers among Russia’s nouveaux riches lead an essentially borderless existence, their most prized gated communities are located in the West. Those who own real estate abroad include numerous public officials and civil servants: ‘Russian bureaucrats have their houses and families in London, and their children are going to Cambridge and Oxford.’ The reason this ‘very strange political class’ craves an extraterritorial foothold is illuminating: ‘They keep their money outside Russia because none of them believes in Russia and none of them believes in official stability. All of them know that this stability could be finished any day.’ They don’t believe in official stability because, as the ones responsible for guaranteeing it, they are aware of their own limitations. For all their talk about ‘the restoration of Russia’s superpower status’, Russia’s senior political officials have an astonishingly ‘primitive mission’, which is to ‘take this money outside Russia, buy houses outside Russia and give their children a future abroad’. Russia’s affluent classes are irresistibly drawn to relocate their assets to countries where there appears to be a future. Their lack of confidence doesn’t reflect a fear that the government they work for is too strong and may one day initiate mass confiscations. Their worry, on the contrary, is that their government isn’t stable enough to protect their investments.

Such feelings of insecurity have grown over the past few months. Well before the December events, local observers told Harding that the Kremlin had been ‘badly spooked’ by the Arab Spring. Indeed, given the absence of any connective tissue between the haves and the have-nots, Russia’s elite was ‘deeply fearful that a similar popular uprising could take place at home’. Certainly no one can claim that vybori bez vybora (‘elections without a choice’) are meant to simulate democracy. Russians citizens know perfectly well that periodic electoral rituals give them no leverage over their rulers. So what do fraudulent elections achieve? In Russia (but not only in Russia), potential rulers don’t necessarily accede to power because they are popular. Some of the time, at least, rulers become fleetingly popular because they are believed to wield power. From the predictable tendency of opportunistic citizens to flock obsequiously to the power-wielders of the day it follows that an incumbent who seems to be losing power may see his poll-tested ‘popularity’ vanish overnight.

This is the nightmare now faced by Putin’s team. Keen to avoid any appearance of weakness, they are well aware that public support can be artificially inflated by the illusion of power. They have long depended on theatrical displays which, however easy to stage, gave spectators an outsize sense of what the government could achieve. This was the purpose of the widely disseminated photos of Putin the action hero winging to the rescue in a firefighting plane, flooring judo opponents, revving a Harley-Davidson, fly-fishing bare-chested, diving into the Sea of Azov to ‘discover’ a sixth-century Greek urn, immobilising tigers with a tranquilliser rifle and shooting a grey whale with a crossbow, all put together by a PR staff in order to embellish what an American diplomat called Putin’s ‘alpha dog’ image. Until now, rigged elections have functioned in the same way. It takes only modest administrative capacity to rig an election; but rigged voting, especially in a country where non-competitive Soviet-era elections linger in the memory, allows a corrupt regime incapable of addressing the country’s problems or making and implementing policies in the public interest to imitate a degree of autocratic authority. By erecting a neo-Soviet façade, meaningless elections and all, Putin’s team may have been trying to elicit support for rulers who have otherwise shown themselves unwilling to put the country’s wealth to public use rather than into their own pockets. The regime has valued ‘managed democracy’ not because it simulates democracy but because it simulates management, something the regime otherwise has a hard time displaying. Can an internally warring, socially detached and rapacious oligarchy hold onto power with only a minimum use of violence now that such electoral fakery seems to have outlived its usefulness? The upcoming presidential election, set for 4 March, means that the answer to this question can’t be postponed for long.