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Siberian capitalism

In the January 2000 issue of this journal, under the title “Sent to Siberia” we described the development of the Norilsk Metallurgical Combine and the emergence of the city of Norilsk. It has been, and is still called, the Frozen Hell. Before 1935, there was nothing there except a few reindeer and reindeer-hunters. But shortly after, nickel and other metal deposits were discovered.

The then Soviet rulers were only able to develop the area by shipping in hundreds of thousands of dispossessed kulaks, and other peasants and workers, as forced labourers in what we described as Russia’s era of the “primitive accumulation of capital”. At that time all such projects, and all the major means of production, were developed and subsequently owned by the state, which was controlled by a minority of “communist” apparatchiks, of whom many ultimately evolved into a privileged and increasingly prosperous nomenklatura or state-capitalist class.

Following the collapse and disintegration of the Soviet Union many large enterprises and combines were privatised, and the workers were no longer exploited by the state. The Norilsk Metallurgical Combine was one such enterprise. Vladimir Potantin, already a privileged apparatchik, was able like many other former Soviet bosses to take advantage of the new privatisation laws and, as a business partner of George Soros, acquire the Combine in 1995 for a fraction of its actual value. He soon became one of Russia’s richest industrialists. He and not the state then exploited the workers. And the Combine is now called a Mining Company.

But what of the workers who have created his riches? And what kind of place has the city of Norilsk become?

Pollution and poverty
Since November 2001, Norilsk has, as in Soviet times, been largely closed to foreigners. But after considerable trouble, Nick Walsh managed to get permission to visit the city in 2003. He described the situation and the condition of the workers in the Guardian (l8 April 2003). In the winter the temperature dropped to –62oC which, due to global warming, was about 10oC milder than ten years previously. In the summer, the temperature can reach 23oC, but only for two weeks. Every day the soot from the Mining Company turns the snow black, and the mine sends 5,000 tonnes of sulphur dioxide into the atmosphere, which makes the air taste sour.

Indeed, the Norilsk Mining Company produces one seventh of all factory pollution in Russia. Every year, it churns out two million tonnes of waste gas, and 85 million cubic metres of dirty water. Its impact, say ecologists, is felt as far away as Canada and Norway, and it is killing the forests for hundreds of miles.
   

Walsh comments: “In Russia, big business runs much of the country, so few even raised a quizzical eyebrow when, last year, the co-chairman of Norilsk Nickel, Alexander Khloponin, was elected governor of the local Krasnoyask region. Last year, he declared his income to be £1m a month, but reportedly earned £30m in share dividends alone.”

A Norilsk Nickel Company spokeswoman accepted that only four percent of all adults in the city were healthy. The hardest working 12 percent of the Company’s workers may retire at 45, but one worker told Walsh that “you pay all your life towards a pension you don’t live to collect”. Most workers cannot afford to leave Norilsk, as they do not earn enough to buy a house elsewhere. They average between £200 and £500 a month. Says Welsh: “They live, work and reproduce for the Company. The money goes round, and eventually people pass away. The city’s isolation means that they pour their wages into Company-owned shops and facilities.”

A market economy
Krasnoyarsk, a city of 900,000 inhabitants almost 1,000 miles south of Norilsk, is the administrative centre of the Central Siberian area. Like Norilsk, it has been depressed and is probably in terminal decay. But it is the home of the giant Krasnoyarsk Aluminium Company, owned by the oligarch Oleg Deripaska’s Rusal Group. The smelting plant is the second biggest of its kind in the world, producing more than 930,000 tonnes of aluminium a year.

In Soviet times, says Terry Macalister, writing this year in the Guardian (23 June) from Krasnoyarsk, the plant produced aluminium pots and pans for domestic kitchens, but now produces aluminium ingots, which are shipped all over the world, including to Britain, where Oleg Deripaska has a stake in the Anglo-Dutch steel company Corus. Jobs at the aluminium smelter, which originally employed 10,000 in Soviet times, have been cut in the last twelve months to 6,700. Duncan Hedditch, who is the tough new Australian boss of the plant, says that he hopes to reduce the number of workers to below 5,000 within three to four years. Yet at the same time, Deripaska is expanding productivity and, therefore, increasing the exploitation of the remaining workers, and investing $270m in modernising the plant.

The Krasnoyarsk aluminium plant produces three percent of the world’s aluminium, and consumes half a million tonnes of carbon every year. Some of the workers earn quite high wages by Russian standards: $800 a month, compared with an average of $250. But the going is tough. And, like the miners of Norilsk, the workers of the Krasnoyarsk Aluminium Company generally do not live to old age.

Workers of Norilsk and of Krasnoyarsk, like workers the world over, cannot win under capitalism, state or private. Many of their problems, however, would be solved by establishing socialism, although others such as pollution and the effects of ill-health, would take longer to eliminate. But, at least, a start could be made.

PETER E NEWELL