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. Last Updated: 07/27/2016

Heavyweights Still Waging Centralization

In July, the general director of the Smolensk vodka factory Bacchus received a phone call at home. The call came from Moscow, from the company Rosspirtprom. The people in Moscow were worried about the director — was he all right? "Yes," he answered, "what’s up?"

"You know, we got a call and were told that you had been killed."

"That’s ridiculous! I’ll be there [in Moscow] tomorrow."

But the director did not in fact make it to his destination. He was killed on his way to Moscow.

Who killed the director? Supporters of one version of the crime ask this question: Might his future killers actually have called him as a warning?

The directive on the formation of Rosspirtprom was signed by President Vladimir Putin on May 6. According to the directive, Rosspirtprom was to receive all government shares in factories that produce alcohol, liqueurs and vodka. And, if that were to happen, Rosspirtprom would be a monopoly equal to, say, Gazprom.

But Rosspirtprom is not just another state enterprise. It is a cornerstone of Putin’s centralization policy. But in order to effect this centralization, the governors must be stripped of their control over state budget cash flows — and no fewer than half of those are generated by vodka sales. Furthermore, this industry brings together an indivisible combination of governors, police — and thugs.

The question of what sort of control Rosspirtprom might wield over regional alcohol producers is essentially a question of what Putin can do with the nation’s governors. But here’s the paradox: To date, Rosspirtprom hasn’t been able to do anything.

As soon as the directive on the creation of Rosspirtprom was signed, the regions began bankrupting factories that produced alcoholic beverages, thereby taking them out of commission as state property. Factories in Penza, Veliky Ustyug, Voronezh, Smolensk — to date, 12 large factories have eluded the government. Question: How did they manage? Simple: Rosspirtprom still doesn’t actually exist. It hasn’t lodged its charter yet.

The charter should have been lodged first with the Agriculture Ministry and then with the Tax Ministry. The former sets quotas on alcohol production; the latter issues licenses for vodka production. Neither ministry wants some other entity to horn in on this cash cow.

These days, many people are saying that the nation is being threatened with authoritarianism — and with good reason, if you look at the president’s directives. But where is this frightening authoritarianism? Look at Rosspirtprom, which employs a group of security types from St. Petersburg; for five months, they haven’t been able to lodge their charter. Even a really tough group can’t wage war simultaneously with the governors, the Tax Ministry, the Agriculture Ministry, the police and petty thugs.

It’s clear that dealing with a horde this big is harder than throwing a media magnate in Butyrskaya Prison. Putin’s actual successes with centralization are minimal to date.

Unfortunately, the gangrenous process in this country has gone so far that everything has rotted, including the most basic surgical instruments used to operate on the patient — including the guillotine, frequently used as the main scalpel.

Yulia Latynina is the creator and host of "The Ruble Zone" on NTV television.