CPA - The Guardian

The small Russian town of Pikalyovo (Leningrad region) became well known across the country. The reason was sad but not uncommon at the moment – the town’s population of 22,000 has been without jobs and wages since February; hot water and gas has been disconnected as the utilities had not been paid.

Despite numerous attempts to solve the problem with the town administration nothing was happening. The people became so desperate that they finally blocked the highway to St Petersburg and created a 400 kilometre traffic jam. Only after that did Prime Minister Vladimir Putin come to sort out the owners of the factories who had stopped production and essentially made the population hostages in their own town.

Pikalyovo is one of the towns where the majority of work places are at the three factories. Five thousand workers were employed there. The factories were built in the Soviet times and their industrial processes were interconnected; in other words they operated as one unit, utilising a by-product of one to produce something else at another. When the Soviet Union collapsed the factories were sold off. At first they operated as before but then the new owners decided to split them up and sell them separately. One of the new owners was former president Boris Yeltsyn’s son-in-law Oleg Deripaska. Oleg Deripaska’s fortune was evaluated at US$28 billion last year. One of the richest men in the new Russia was not interested in being involved with the factory so he just closed it down.

“You have made thousands of people hostage to your ambitions, your lack of professionalism – or maybe simply your trivial greed,” Putin told Deripaska and two other businessmen who own cement and alumina factories in Pikalyovo.

“Where is the social responsibility of business? Putin said to the Leningrad region governor. “Where is it? We keep talking about it non-stop. No one in the administration will ever convince me of the fact that the regional administration has done all they could to help the people. When I told you that I was going to come here, what did you tell me? You said that I shouldn’t. You said that you would show me a different enterprise. Why was everyone running about like cockroaches here before my arrival?”

Putin’s visit to Pikalyovo certainly helped the people there and they were glad of the outcome. At the same time their trade union leaders do not seem to have any clue about defending workers’ rights. They should have been aware of the problems created by the separate sell off of the factories. They were all in favour of capitalism then and even now they say that they don’t care who the owners are as long as there were jobs there.

They hope that new managers will be better than the old ones. There are many towns like that in Russia where the population depends totally on a single job-producing enterprise. People do realise that the whole system is rotten but evidently are not yet ready to fight for their rights as their predecessors were.

A week later Russia’s legendary cruiser Aurora was turned into floating bar for oligarchs after their deliberations at the Economic Forum in St Petersburg. Russia’s top officials and millionaires were invited to come to the party organised by Mikhail Prokhorov, Russia’s richest man. Not only were former marines insulted by the party. Hundreds of people flooded the Internet expressing their disgust with the new rich and the desecration of the Aurora which is the symbol of the October Revolution. So there you are – as Lenin used to say about capitalist society – “two nations”.

Note: St Petersburg and Leningrad district are mentioned in the story. When the name of the city was changed from Leningrad to St Petersburg the name of the district around it remained the same. So now we have St Petersburg and the Leningrad district.

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