Approaches to Rural Reform in Russia

Among accounts of post-Soviet rural transformation, three approaches have emerged concerning the outcomes of land distribution programs. Some scholars have argued that despite the best hopes of Russian economic liberals, there has been no discernible change linked to rural reform policies.Footnote ⁶ Under this rubric, change is at best “cosmetic” or superficial—a revolution only of language. In one such formulation, there has been “no genuine reform process;”Footnote ⁷ the names for former collective and state farms (kolkhozy and sovkhozy) have changed, but actual patterns of land tenure, labor organization, and ownership have not. Others, meanwhile, have rejected the notion that agrarian reform reflects a mere “change of signboard.” These accounts call attention to individuals' and enterprises' adaptation to markets, emphasizing the role of personal disposition and other factors believed to drive entrepreneurial behavior.Footnote ⁸ Both of these perspectives capture important elements of the process and outcomes of land privatization in rural Russia, but they each fail to incorporate critical insights that the other brings to the table. I argue instead for a conceptualization of agrarian change that regards contemporary land rights as a modern Potemkin village: a façade of de jure ownership that masks deeper transformation—in this case, transformation that includes dispossession in the post-Soviet Russian countryside.Footnote ⁹

This view shares with proponents of “cosmetic reform” the assessment that new property rights exist primarily in the world of bureaucracy. Worker-shareholders own land “on paper, on paper. And where that land is, who knows?”Footnote ¹⁰ The superficiality of change suggests more than a failure of institutional reform. It also serves a purpose. Paper rights conceal processes of change that, while benefiting a few, resulted in dispossession for the many. Like the wooden facades that, according to legend, were constructed along Crimean roads to impress and mislead Tsarina Catherine the Great during her travels at the end of the eighteenth century, post-Soviet Potemkin villages convinced Moscow of local state officials' loyalty and international lending and trade organizations of Russia's commitment to property-rights reform.Footnote ¹¹

That farm directors, members of district land committees, and other agricultural elites refused or failed to comply fully with demands emanating from Moscow should not suggest that elites opposed market reform as such. As Stephen Wegren argues, the logic of their behavior was economically rational and their response to reform adaptive.Footnote ¹² Rural business elites resisted not the market, but the allocation of meaningful rights to worker-shareholders, such that those rights would have threatened the competitive advantage of enterprises or the personal fortunes of those elites.

Some observers attribute business elites' reluctance to implement reform to bureaucratic intransigence inherited from socialism. However, farm elites' motivation in obstructing certain elements of land privatization (all the while benefiting from other elements of it) was fundamentally market oriented. Wegren counters the claim that farm managers resisted reform by emphasizing managers' interest in profitability.Footnote ¹³ But adaptation to markets does not preclude maximization of self-interest and profit at the expense of the rights of new owners. Rather, a promarket and antiworker stance on the part of the economic elite is consistent with market adaptation. The two “faces” of the Stolypin reforms' late-twentieth-century incarnation are not incommensurable, but complementary.

Privatization failed to create new mechanisms of capital accumulation and reproduction for most rural people, and the acquisition of property rights came at a high cost. Some of this cost proceeded from the broader economic context into which private land rights were introduced. The urban bias of post-Soviet agrarian policy, and its negative effects on rural populations, has been documented widely.Footnote ¹⁴ As in so many other countries implementing similar reforms, interactive effects between land privatization and other elements of structural adjustment left rural people in a disadvantaged position.Footnote ¹⁵ In 1992, as the reorganization of agricultural enterprises began, Russia's borders opened to trade, price controls were lifted on most goods, and the government slashed budgets to resolve balance of payments problems. Markets flooded with agricultural goods from abroad. Agricultural subsidy regimes in the west and cheap labor to the east kept prices low on imported goods, and Russian producers could not compete. The difficulty of extracting value from land ownership, together with changing payment structures for labor, deprived people in rural Russia of opportunities for capital accumulation during the early years of post-Soviet market development. As Cindy Hahamovitch and Rick Halpern have observed in arguing for the inclusion of agricultural workers in class analysis, “Classes form in the countryside but they also unravel. States help build classes and destroy them, sometimes at the barrel of a gun, sometimes simply by letting prices fall or borders open.”Footnote ¹⁶

The privatization of agricultural land in post-Soviet Russia is thus one thread of a broader narrative of dispossession in post-socialist societies.Footnote ¹⁷ Just as in cases of industrial privatization, the de facto managerial takeover of whole collective farms as if they were individual private possessions did not right historical wrongs. Post-Soviet privatization of farmland and agricultural enterprises did not involve restitution and was not intended to restore ownership to enterprise owners whose holdings previously had been nationalized. Instead, late-twentieth-century rural reform was to restore land to the tiller. The individuation and allocation of land that in many cases had no single owner prior to the socialist period, and the analogous distribution of shares in warehouses, office buildings, cow sheds, tractor parks, and other products of socialist-era labor, was meant to allow individuals to acquire shares in goods they had helped to maintain or construct.Footnote ¹⁸ No wonder, then, that many rural people regarded the post-Soviet consolidation of land ownership into latifundia as robbery in broad daylight.Footnote ¹⁹

Land Privatization in Liski, Voronezh oblast'

Voronezh oblast', an administrative region in southwest Russia that is today home to over two million people, is a useful place to examine the process and outcomes of post-Soviet land privatization, especially in light of the Stolypin-era reforms that late twentieth century liberals meant privatization to imitate. The region had seen relative success in previous iterations of land distribution. In Voronezh guberniia, the Stolypin reforms had offered landless and relatively land-poor peasants genuine opportunities for acquiring plots. By 1914, landless peasants accounted for thirty-seven percent of land purchases in the gubernia.Footnote ²⁰ At the time, some peasants' interests had been aligned with the positions of local elites, for at the start of the twentieth century Witte Commission committee members in Voronezh seemed poised against land communes.Footnote ²¹ Some fifteen years after the Bolshevik revolution, Stalin's collectivization of agriculture in Voronezh resulted in the consolidation of land holdings and the formation of collective and state farms. However, by the end of the twentieth century, even as the Voronezh “Red Belt” political establishment continued to express loyalty to communist parties, and farm chairmen opposed the partition of the fields they oversaw, Voronezh had more private farmers per hectare of arable land, on average, than other Russian regions.Footnote ²²

Liski district, an expanse that includes some two thousand square kilometers of rolling hills and grain, sunflower, and sugar beet fields, is an hour's drive south of the city limits of Voronezh. In Soviet times, the district was home to several successful livestock farms. In prerevolutionary Russia, the area had been dominated by landlords and, as such, was relatively well off as a whole.Footnote ²³ Liski serves as a transportation hub in the region: a major railroad junction in the town of Liski links train lines to the south, to the city of Rostov, and west, to Ukraine. Of the fifty thousand people who live in Liski district, about one quarter work in agriculture. The vast majority of Liski residents are ethnic Russians, though the district is also home to ethnic Ukrainians, Roma, and people from the Caucasus. Rural residents in the district enjoy relatively developed infrastructure: over ninety percent of villages have gas lines, and paved roads wind through small villages as well as towns.Footnote ²⁴

During the difficult 1990s, local state officials in Liski adopted agricultural policies intended to preserve the district's comparative advantage. The district provided assistance to large farms in obtaining credit and marketing agricultural production.Footnote ²⁵ Despite intense pricing pressure to cull livestock herds, district agricultural officials enforced a strict policy of maintaining livestock populations. When price scissors eventually subsided, farms in the district were positioned to reclaim their place in the regional economy as important producers of milk and meat.Footnote ²⁶ Such decisions, together with a felicitous location and transportation links to urban markets, have allowed the district's relative prosperity to continue to this day.

Even as state officials in Liski were mindful of preserving the productive capacity of large farms in the district, they seemed tacitly to discourage the development of small-scale, private commercial farming, a movement that first emerged in the late 1980s based on leasing brigades within agricultural collectives. By the mid-1990s, after the period of most intense creation of private farms, Liski had allotted a smaller proportion of arable land to private farmers than any other district in Voronezh region.Footnote ²⁷ Here, as elsewhere in Russia and other post-Soviet states, private farmers encountered difficulties obtaining land because “the [collective farm] chairman was against it.”Footnote ²⁸ Directors of collectives could in practice, though not in law, veto allotments from the territories they managed. Farm chairmen were sometimes open in their dislike of distribution policies, noting that they “wouldn't like to hand over land.”Footnote ²⁹ Meanwhile, state land committees charged with overseeing reform did not use their leverage to counter collective farm chairmen's resistance to allotment of land for private farms. Chairmen also found allies in the district press, which published numerous articles critical of land privatization, advocated for buying produce locally, and positioned itself as a protector of rural interests.Footnote ³⁰

Regional politicians nonetheless held Liski up as an example of successful agricultural business strategies. In 1998, on the eve of the currency crisis that brought Russian cities to the brink but temporarily boosted rural economies by dramatically decreasing the importation of food from abroad, the deputy governor of the region named Liski one of three districts that had excelled in economic reform.Footnote ³¹ Liski's relative wealth, and the improvements in agricultural production it had experienced in recent years, should have provided a fertile environment for rural worker-shareholders to benefit from ownership.

Resurrecting Stolypin?

Land privatization in post-Soviet Russia transformed the ownership structure of the collective and state farms that had dominated Russian agriculture since the 1930s. During the Soviet period, land had belonged to “the people,” with the state as executor. After the fall of Soviet power, at the behest of the Russian President and a parliament deeply divided on the issue, collective and state farms were reorganized as agricultural cooperatives, joint stock companies, and other corporate forms. For most organizational forms, the land and non-land assets of each enterprise were divided on paper among individuals who currently worked on the enterprise or had retired from it within the previous twenty years. The exclusion of rural social-services workers, “as if all that time they lived and worked not in the village, but on another planet,”Footnote ³² as well as older pensioners created social conflict and a degree of gender inequality in the process. Education and healthcare workers were mainly women, as were older pensioners—a great number of their male counterparts had died fifty years before, as Black Earth villages met Hitler's army.

According to the specifications of post-Soviet land reform policy, the amount of land each worker-shareholder received was determined by a district norm. Remaining land became part of a district land fund, to be distributed to petitioners for land for private farms or to be used by reorganized collectives. Non-land assets were distributed according to a formula that took into account position and years of service. Members of collective farms and workers on state farms, once their enterprises had undergone this process, received documents attesting to their right to a particular amount of land—in Liski, about five hectares—on the territory of the collective in question. In theory, shareholders had a number of options: they could have their land allotted and farm it themselves; they could have it allotted and lease it to a private farmer or other enterprise; or they could lease it back to the reorganized collective. In practice, the last option was often the easiest and most sensible. The lack of developed land markets, and the high financial and social cost of removing the land from collective use, led most to continue to remain on reorganized collectives.

Under Stolypin, peasants who successfully petitioned for allotment and consolidation of land holdings avoided the periodic repartitions carried out by the peasant communes that had governed land use during the post-emancipation period. Like post-Soviet land privatization, the Stolypin-era reforms were directed at a real or imagined latent entrepreneurial class who, stifled by the inefficiencies of commune-directed land tenure arrangements, would emerge as “pioneers” in farming.Footnote ³³ Under the commune system, households received multiple allotments that they farmed until the next repartition: in Voronezh, one in six peasants farmed more than twenty individual strips of land.Footnote ³⁴ In principle, this arrangement allowed members of communes relatively equal access to good soil, even as it placed certain limits on farming technology and made arguably excessive demands on labor resources. The Stolypin reforms allowed peasants to consolidate and receive title to their scattered holdings. The political implications of this proposed shift were clear: allotment and consolidation of land would weaken the commune and, amidst the upheavals of early twentieth century Russia, its potential as a locus for “rebellious activities.”Footnote ³⁵

In post-Soviet Russia, converting paper rights into access to land and non-land assets was a difficult process. Allotment of land was both expensive and, often, not in the interest of the former collective. As in the case of Stolypin-era reforms,Footnote ³⁶ some villagers resisted enclosure, initiating violent attacks against those participating in partition and consolidation. Meanwhile, shares in non-land assets were almost never allotted. The value of those assets—farm machinery, storage facilities, livestock sheds, and buildings—required ongoing valuation and readjustment amidst sustained hyperinflation and currency devaluation. Furthermore, shares in non-land assets were small relative to enterprise debt, and some directors threatened worker-shareholders with assessing their individual share of debt as well if they requested their share of assets.

Because membership in a community was key to access to land, contestation over membership in the collective or commune was a central feature of both processes of transformation. Early-twentieth-century communes worried about allotting land to women and migrant workers who, due to their social position, stood to lose access to land if they did not petition for allotments.Footnote ³⁷ Post-Soviet farm directors and land committees viewed the same groups through a different lens: marginal members of society had little chance of competing with larger producers and as such, posed no significant threat to the existing order. For this and other reasons, women and migrant petitioners for land were sometimes granted fields where others were refused.Footnote ³⁸ The use of “dead souls,” meanwhile, appeared in attempts to claim land.Footnote ³⁹ In both cases, outsiders were central to land distributionFootnote ⁴⁰—both in reality and in the imaginations of locals, who at the end of the century expressed their concern in an oft-repeated refrain that “we'll be slaves on our own land.” As the Liski newspaper noted in 1992, “In places we're threatened by expansion through the transfer of land as private property to enterprising people from the south.”Footnote ⁴¹

Despite some basic similarities, both the process and the outcome of postsocialist land privatization differed from the Stolypin-era land reforms they were meant to recapitulate. Macey identifies four important distinctions between rural reforms during the first decade of the twentieth century and those at century's end.Footnote ⁴² First, in contrast to post-Soviet reform policies, Stolypin-era land distribution occurred in a context of developed markets. Second, the earlier reforms involved extensive state participation and engagement at the local level. Third, Stolypin-era reforms exhibited a “pro-agricultural” rather than an urban bias.Footnote ⁴³ Finally, early-twentieth-century land distribution was expressly intended to forestall the proletarianization of the countryside and stem the tide of urban in-migration.Footnote ⁴⁴ On this last point, post-Soviet land distribution also was meant to safeguard social stability through the creation of a rural middle class. However, where Stolypin-era reforms may have succeeded in accomplishing this aim, post-Soviet reforms failed utterly: property rights development in contemporary Russia resulted in a rural population with few meaningful rights to land ownership beyond the household plots of their backyards.

Among historical efforts at transformation of land tenure regimes in Russia, postsocialist privatization was distinguished by the absence of a bureaucratic vanguard. Despite the strong momentum driving certain elements of post-Soviet rural reform, this “urge to mobilize”Footnote ⁴⁵ was not supported by shock troops from the capital, such as had accompanied collectivization.Footnote ⁴⁶ Unlike many of the land captains who were responsible for overseeing reform of rural communes in the early twentieth century,Footnote ⁴⁷ state officials charged with carrying out privatization were local people with broad discretion in carrying out their duties.Footnote ⁴⁸ Although access to state resources made them relatively privileged within their communities, the men and women who staffed district land committees, land tenure offices, and village councils lived lives embedded in local rural social networks. As a result, some rural officials held a personal interest in the outcomes of battles over land distribution. The “local engagement” of the post-Soviet era often involved obstruction, rather than promotion of reform, by those charged with its implementation. However, as some local officials discovered ways to appropriate land for themselves or their kin, they pushed ahead with privatization, using the bureaucratic channels to which they had access.

Agricultural technology also shaped the implementation of land reform during the two periods in radically different ways. For all of the social and indirect economic costs of land allotment in the Stolypin-era reforms, there was a certain sense to the incentives they offered. They presented peasants an opportunity to address the challenges of tilling narrow and scattered strips of land.Footnote ⁴⁹ Consolidation allowed easier and more efficient use of ploughs and other tools in wider allotments. With consolidated plots, peasants could avoid potentially catastrophic losses of time incurred while traveling between strips. For mid-sized farms with appropriate labor, land, and livestock ratios, the main economic drawback of consolidation—the potential loss of communal grazing rights—could be managed by tethering animals.Footnote ⁵⁰

Post-Soviet land reform offered none of those potential benefits. On the contrary, the capitalized character of Soviet agriculture made land allotment a more complicated and risky enterprise than Stolypin-era consolidation. Agricultural collectives in the Black Earth grew grain, sunflower, and sugar beet in fields that stretched for hundreds or thousands of acres, with centralized irrigation systems and storage facilities. With the exception of the long, hot task of hand-thinning sugar beet, the cultivation and harvesting of industrial crops was mechanized in the late-Soviet Black Earth. The use of combine harvesters and other large machinery led directors of collectives to resist land allotments from any but the most marginal fields. Otherwise, the resulting patchwork would have made the task of large-scale farming by former collectives impossible.

Hand cultivation of grain and industrial crops was inefficient and unprofitable, and growing vegetables in marginal fields required an unreasonable investment of labor and time in travel. Local state officials often demanded, therefore, that post-Soviet petitioners for agricultural land first acquire appropriate machinery. This requirement created delicate timing problems for would-be farmers, for “the process was such that before, they were giving out 100 hectares, but I had no machinery. By the time I had prepared machinery, you couldn't get land.”Footnote ⁵¹ Such an investment was a risky proposition: applicants had no guarantee either that land would be allotted, or that it would be parceled in time for sowing that year. As one Liski farmer wondered, “Why would I have a tractor if I have no land?”Footnote ⁵²

Even those private farmers who managed to obtain land risked losing it to bankruptcy or bad health:Footnote ⁵³ farmers unable to recover the cost of initial capital investments in good time could face difficulty planting or preparing their fields in subsequent years. Land zoning rules allowed district state administrations to repossess land that was not being used for its intended purpose. This situation was exacerbated, as it had been under Stolypin reforms, by limitations on or exclusion of the use of land as collateral. In Liski, as in other districts, some farmers went out of business; according to official statistics, twenty-eight private farmers were registered in the district as of January 2000.Footnote ⁵⁴ By May of the same year, the situation had changed:

Those farmers who had the means and luck to pay off the debts they incurred in starting their businesses encountered continual challenges in operating a farm. Even powerful private farmers—“when I stop into the bank, everyone there knows me”—were unable to obtain credit from state or private banks on reasonable terms. At the turn of the millennium, credit was issued at “fifty percent. It's highway robbery.”Footnote ⁵⁶ The state support for private farming that had characterized the initial stages of privatization was withdrawn: “Before they gave us discount rates, when we were starting out … it used to be three percent, and now it's fifty.”Footnote ⁵⁷

In contrast to Stolypin-era reforms, in which allotment made the best economic sense for mid-sized farms and households, the political economy of post-Soviet land distribution favored the wealthy or well-connected, on the one hand, and poor or marginal villagers who had nothing to lose on the other.Footnote ⁵⁸ In both cases, poverty sometimes prevented exit from the commune, as would-be farmers encountered a multitude of economic obstacles to creating prerevolutionary and post-Soviet khutora (independent farm homesteads) or otruby (farming allotments).Footnote ⁵⁹ But middling villagers also faced economic obstacles: worker-shareholders in reorganized collectives relinquished communal grazing rights for their household livestock when they allotted land, and tethering meant unmanageable labor demands and inefficient use of land.Footnote ⁶⁰

In post-Soviet Russia, such obstacles led farm managerial cadres to conclude that most rural people “don't want to establish private farms” because “it's not realistic.”Footnote ⁶¹ Collective farm chairmen, who had reason to avoid allowing allotments from the fields they managed, were thus able to claim more or less plausibly that only economic, not political constraints prevented worker-shareholders from leaving: “one candidate for private farmer was found on [the former collective] ‘Daybreak.’ The collective farm would allot land for him tomorrow. But with his monetary share, the would-be owner can barely buy a couple hundred kilograms of cement. Knowing how much things cost in the real world, the guys in [the village of] Trinity decided to remain on ‘Daybreak.’”Footnote ⁶²

Mechanisms of Dispossession

The widespread character of dispossession in the Russian countryside is linked less to the limited creation of private farms—the post-Soviet equivalent of Stolypin-era khutora—than to the distribution and titling of collective and state farmland. As in so many other instances, the process of privatization itself contributed to the dispossession of workers and concentration of capital in the hands of managers. Worker-shareholders who remained on former collective and state farms gained expanded access to rented plots for household production,Footnote ⁶³ but most lost other resources and opportunities for capital accumulation as commercial agricultural land was divided into shares. Even as large-scale farms continued to function as primary economic engines and social anchors in rural Russian communities, worker-shareholders lost ground, unable to take advantage of the benefits of ownership.Footnote ⁶⁴

The social organization of former collective farms limited worker-shareholders' ability to gain from ownership.Footnote ⁶⁵ At the village and enterprise level, two sets of actors—state officials and heads of collective farms—controlled both the official distribution of land shares and the conditions under which worker-shareholders could use those shares. The language that both worker-shareholders and heads of farms used to describe leasing arrangements is suggestive of the rigid hierarchical relationships that continued to characterize reorganized agricultural collectives. The verb that frequently appears in such accounts, for example, is zabrat’—to seize, or collect, as in, “We collected land shares from people.”Footnote ⁶⁶

Gender labor hierarchies likewise shaped the value of property rights for rural people. Among nonspecialist worker-shareholders, machinists, who during the late-Soviet period were almost exclusively men, had skills best suited for private commercial cultivation. Meanwhile, as struggling collectives outsourced livestock production to individual households, the women who staffed dairy farms took on substantial additional labor burdens with only minimal compensation.Footnote ⁶⁷ When it came to negotiating land share lease payments, women were in a less advantageous bargaining position than their male counterparts: “Guys can work as drivers, machinists, and lathe operators. It's worse for the girls: if she doesn't want to go work on the [livestock] farm, she can be left without employment.”Footnote ⁶⁸

Managers of collectives in Liski described reorganization as having been conducted “from above,” “at the general assembly, unanimously.”Footnote ⁶⁹ The process of reorganization did not, in itself, change the way the farm operated: “It was a kolkhoz before, and it remains a kolkhoz.” On “Chapaev” this was a strategic choice on the part of managers, not an unintended consequence: the form of an agricultural workers’ cooperative was chosen because it “corresponded to the previous form.”Footnote ⁷⁰ Likewise, the managers of “Fatherland” chose a workers' cooperative because it was “closest to a kolkhoz,”Footnote ⁷¹ rather than a joint-stock company, which was judged to be too expensive. There too, reorganization proceeded “unanimously” at the general assembly after the chairman had spoken: “Whatever was proposed, they chose.”Footnote ⁷²

While collective farm chairmen did not resist market reform as such, they did try to protect their own interests and the interests of the enterprises they managed. In many cases, this meant deploying bureaucratic tactics to prevent people from leaving collectives and taking their land and non-land asset shares with them. Such measures operated out of plain view, and local newspapers often reported them using vague language: “Pensioner Ivan Senchikhin told about how people tried to take their land shares from a collapsing farm and transfer it to the effectively developing agricultural cooperative ‘Liskinskii,’ but they were prohibited from doing so through administrative methods.”Footnote ⁷³ In other instances, farm directors accomplished this more directly by limiting worker-shareholders' physical access to the documents that testified to their ownership of land shares.

Administrative methods included managers' threats to revoke social entitlements associated with membership in agricultural collectives. For rural people, this could mean expulsion into the wilderness beyond the “kolkhoz archipelago.”Footnote ⁷⁴ Farm directors used the advantages of community membership to pressure worker-shareholders to keep their land within the enterprise's control. For example, a resident of a village near the private farm “Rus'” (formerly the agricultural collective “Daybreak”) noted that “At one time we received an apartment in the collective farm, they won't let us privatize it, and now it's used as a method of pressure—if you don't like life in the village, vacate the apartment.Footnote ⁷⁵ Threats against access to transportation, schooling for children, and healthcare also were common. Some enterprise directors also used such threats to control not only use of worker-shareholder land, but also labor resources: in 1996, seven Liski families faced the choice of providing one adult worker per family to the collective farm “New World” or losing access to the water main that ran through the village.Footnote ⁷⁶

Such threats added to already substantial constraints on worker-shareholder mobility. By 2000, the head economist of “Fatherland” reported that, “No one has taken his share. They lease them [to Fatherland], but the contract conditions are unfeasible.”Footnote ⁷⁷ Without cash to pay for allotting land, many worker-shareholders had no practical choice but to lease their shares to reorganized collectives. This was especially the case in districts with few powerful private farmers who might “work it out with the pensioners, with the grandmas, because they all have five hectares of land each.”Footnote ⁷⁸ This was not due to a lack of desire to allot land, as in a neighboring district, where “there are more and more people who would like to leave the former collective with their land share,”Footnote ⁷⁹ but rather due to a structural inability to do so. Despite Liski's relatively advantageous location with respect to transportation and industry, there were few alternatives to leasing land to the former collective. With no private farms nearby, “People have nowhere else to go.”Footnote ⁸⁰

Wages of Ownership

If social control played an important role in shaping worker-shareholders' access to the benefits of ownership, low lease payments for land shares also limited rural people's opportunities for capital accumulation at critical periods during the process of privatization. In addition to the formal monopsony that characterized land share markets in areas without strong private farmers, worker-shareholders faced other obstacles in extracting value from land share ownership. Many farm directors did not sign leasing contracts with worker-shareholders; those who did sometimes withheld them from shareholders' view, locking them in the safe in their office.Footnote ⁸¹ Lease payments were symbolic, often a few sacks of grain at harvest time. In 2003, the Voronezh regional newspaper observed that, “Last year for the first time in ten years they distributed two hundred kilograms of grain, five liters of vegetable oil and fifteen kilograms of sugar for each share.”Footnote ⁸² The value of even such a windfall could do little to feed a family for the year; two hundred kilograms of grain was worth at most 600 rubles at the time, about ten days' pay for one person.Footnote ⁸³ In Liski, the situation had become so serious by the following year that district council found it necessary to issue a recommendation on the value of land rents. According to the recommendation, for each share, the leaser should provide 500 kilograms of grain, fifteen kilograms of oil, fifteen kilograms of sugar, free plowing of household plots, and “household” and funerary services.Footnote ⁸⁴

The low value of rents as well as other aspects of rural land privatization separated control of the means of production from labor relations and incentives. During the late-Soviet period, members of collective farms had received not only remuneration for labor, but also entitlements based on community membership. Payment was thus linked, in part, to members' legally underspecified but socially constituted stake in the health of the collective farm. The conditions surrounding land privatization changed aspects of this relationship, subtly decoupling worker-shareholders' role as laborers from their role as owners. This was precisely the opposite of what reformers had intended. As in Stolypin-era reform, land ownership was meant to improve stewardship and to strengthen the link between the land and its tillers. The Stolypin reforms produced a similar paradox: then, those most likely to participate in allotment were those who intended to sell, not improve the land.Footnote ⁸⁵

Many agricultural enterprises calculated land rents based on production levels.Footnote ⁸⁶ As one farm director described it, “We work according to contracts. If we have a harvest, you'll receive [what is specified in the contract], if not, you won't get anything.”Footnote ⁸⁷ This choice reflected the belief that ownership would improve labor incentives by giving rural people a stake in the productivity of former collectives. However, in most cases this arrangement instead held rural people hostage to economic conditions they could not control.

Agricultural enterprises in Russia faced enormous economic and logistical challenges during the 1990s and into the new millennium. Contrary to prevailing beliefs, most of these challenges were not linked to the quality or intensity of labor. During the late Soviet and post-Soviet periods, former collective and state farms did face unstable labor cadres—“people come and go”—and machinists were perennially in short supply.Footnote ⁸⁸ However, market reforms did not address or resolve the supply chain problems that had plagued agriculture during the 1980s.Footnote ⁸⁹ High oil prices exacerbated the problem, leading farm managers to lament that, “before, you didn't have to kill yourself trying to figure out where to get diesel.”Footnote ⁹⁰ Because of serious difficulties in locating steady supplies of agricultural inputs, it was “impossible to establish a reserve,”Footnote ⁹¹ and enterprises could find themselves without key machine parts, storage materials, or fuel at critical times during the growing season. No matter how hard worker-shareholders were willing to work in order to improve production, structural constraints limited enterprise profits.

Farm profits also were limited by reliance on middlemen who set their fees according to a proportion of the harvest, rather than a volume of goods or a cash amount. Middlemen handled plowing, harvesting, and crop storage. During the post-Soviet period, they asked up to thirty percent of the harvest for any one of these services. Some agricultural middlemen acquired their assets at fire sale auction prices during the early 1990s: as well-placed individuals purchased industrial enterprises at auction for a fraction of their market value, “the reform started, the buy-up, including of agricultural machinery. They bought up shares of stock for almost nothing.”Footnote ⁹² In Liski, the primary provider of machinery was the RTP (Repair and Machinery Enterprise)—a company whose controlling shares were held by a Moscow industrial bank. It serviced all large agricultural enterprises in the district, as well as private farms. Because the Liski RTP worked with all major agricultural enterprises in the district, it was a significant provider and thus shaped local prices. Contracts with the Liski RTP were paid half in cash and half in harvest—or in metal, electricity, or gas.Footnote ⁹³ Harvest payments were priced upon delivery, rather than at the time of contract,Footnote ⁹⁴ and at the height of the harvest season, prices were at their lowest. Agricultural enterprises without adequate crop storage facilities were compelled either to sell a substantial portion of their harvest immediately at low prices, or to pay for storage until prices increased—in which case they risked spoilage, pest contamination, or mixture with lower-quality grain.

Farms in Liski, like farms throughout Russia, faced additional heavy financial obligations in taking on the burden of social service provision to pensioners, who were less likely than others to have the money for land-share allotment. In 2000, the director of “Chapaev” put it this way: “There are very many pensioners. We can't do what we want because we have to service them. Of 1,200 people, only 340 are workers. The rest are pensioners.”Footnote ⁹⁵ On nearby “Fatherland,” 260 workers maintained an enterprise that served 400 pensioners.Footnote ⁹⁶ Like the members of Stolypin-era land communes who worried that those who sold their land allotments could become a “burden to the commune,”Footnote ⁹⁷ directors of enterprises had not only to run the business, but also to provide for less able members of the community. Post-Soviet agricultural enterprises were released from state control into an economic environment that could sink even strong firms, just as local state institutions externalized costs by de facto leaving social service provision to those firms.Footnote ⁹⁸ Farm directors handled this problem by subtracting the cost of services from land rents—hence the Liski district council's explicit recommendation of “household” and funerary services as part of leasing arrangements.

The low value of land rents meant not only that land shareholders did not gain from ownership, but, as other elements of institutional reform proceeded, they also lost through taxation. Post-Soviet land tax requirements may bear greater resemblance to Russian post-emancipation land tenure arrangements than to Stolypin-era reforms in the burden they placed upon rural people: emancipation required peasant households not only to accept shares in communal land but also to pay the taxes imposed upon those shares.Footnote ⁹⁹ Under privatization, the deputy head of the Liski land committee described rural peoples' “great unwillingness” to accept land share documents during the mid-1990s.Footnote ¹⁰⁰ When some rural people resisted participation in post-Soviet land share distribution, their motivation was likely not ideological. Rather than demonstrating culturally-based antipathy toward markets, as some commentators have suggested, members of collective farms simply may have been wary of the financial obligations that nominal ownership would eventually impose upon them, for “a great deal became clear when the ‘trap’ worked and land taxes sharply increased.”Footnote ¹⁰¹

Some worker shareholders responded to increased tax burdens by attempting to extricate themselves from ownership relations. However, this proved costly both in the direct financial sense and, in some cases, in terms of the social relationships that sustain informal economic life. The sale or gift of a land share required expensive cadastral work that alone could cost a pensioner half of her monthly income. For people living paycheck to paycheck, this constituted an overwhelming burden that did nothing to improve future income. Rather, it merely staved off total ruin: “Tax debts are growing. ‘Law experts’ arrive from the district center and warn: if you don't pay taxes or properly register your refusal [of land] we'll inventory your property … they can take away your house and … resettle you in a dormitory.”Footnote ¹⁰²

Payment for Labor

Worker-shareholders in Liski, elsewhere in Voronezh, and across Russia found themselves in a predicament: land privatization should have conferred benefits of ownership that would improve labor productivity and allow them to achieve a middle-class life. The main mechanisms of capital accumulation available to them, however, turned out to be household production and labor on reorganized former collectives. The latter was a necessary support for the former: wages from work on the collective, whether in cash or in kind, helped sustain household production.Footnote ¹⁰³ Worker-shareholders took the feed grain, young animals, hay, construction materials, salt, sugar, and other commodities they received through their association with former collectives and used them as inputs for their gardens and livestock husbandry. Some managed household production successfully and produced a meaningful marketable surplus. Others fell into or remained in poverty, due in part to the problem of wage arrears after privatization.

The relative success of large agricultural enterprises in Liski during the post-Soviet period did not protect worker-shareholders from continual delays in receiving their wages. Some directors raised livestock workers' salaries in order to compete more effectively in a thin labor pool,Footnote ¹⁰⁴ and one farm director claimed to have offered an advance to milkmaids, paying them monthly and in cash in order to raise productivity.Footnote ¹⁰⁵ However, most worker-shareholders did not receive regular payment for their work. In Liski, five years into the period of liberalizing economic reforms, a nine month delay in distribution of wages on state farm Kolybel'skii led milkmaids to slow production,Footnote ¹⁰⁶ while livestock workers on the Petropavlovskii collective farm refused to feed or milk cows in protest of unpaid wages.Footnote ¹⁰⁷ The situation escalated to the point of open conflict by December 1998, when the milkmaids of the “40 years of October” collective farm “literally assaulted” its head, threatening to stop milking the cows if he did not release their wages for October and November.Footnote ¹⁰⁸

Even after wage arrears had been addressed in Russia's industrial sector, agricultural enterprises continued to withhold wages from worker-shareholders. In a nearby district, a private farmer later commented that, “With every year the situation on the agricultural enterprises becomes more troubled. In places people haven't seen their salaries for years.”Footnote ¹⁰⁹ Even in Liski, where workers were paid more on average than nearly any other district in Voronezh, the situation only worsened over time.Footnote ¹¹⁰ In May 2000, even strong enterprises were withholding wages for three months,Footnote ¹¹¹ and other large agricultural enterprises in Liski had not paid their workers for six to seven months.Footnote ¹¹² As the head economist for “Fatherland” described the situation at the time, “There's no salary, no incentive.”Footnote ¹¹³ By the summer of 2003, wage arrears had skyrocketed. Agricultural production in Liski had increased, but enterprises in the district had an outstanding wage bill of over 446 million rubles,Footnote ¹¹⁴ and the average Liski worker-shareholder had not received payment for their labor in well over a year.Footnote ¹¹⁵

On one of the healthiest farms in the district, where worker-shareholders received up to sixty percent of their wages in cash, worker-shareholders' constrained mobility in the face of weakened public transportation infrastructure limited how they could spend their wages. The director of “Pavlovskoe” explained how wages were paid:

For worker-shareholders, part of the potential problem lay in how those prices were computed. The arrangement saved workers transportation and time costs, but it introduced other limitations. First, workers often were compelled by force of circumstance to accept whatever price the farm's accountant decided to use, and second, individual workers' social status could shape access to particular commodities.Footnote ¹¹⁷

Worker-shareholders recuperated some proportion of unpaid wages in pilfering and “pan-toting,” but it is not possible to state with any accuracy to what extent, and among what communities, this was the case. Notwithstanding such attempts at compensating for wage arrears, delays in payment for labor posed multiple problems for worker-shareholders and acted as an obstacle for capital accumulation—itself a necessary condition for land acquisition. Worker-shareholders who faced wage arrears during times of inflation suffered particularly, as they saw their “savings” plummet in value, unable to redeem them for durable goods.

In periods of acute social conflict, such as the currency crisis and subsequent political reshuffling of August 1998, rural people were more insulated from food shortages than their urban counterparts. However, they were more vulnerable than usual to difficulties in obtaining goods for which they normally paid cash, as people from urban areas swept villages in search of reserves of oil, salt, matches, soap, and other staples.Footnote ¹¹⁸ In such situations, a lack of immediate access to cash could translate into an inability to convert household production into storable food for winter or market. Finally, the seasonal nature of agricultural work, including household production, meant that delays in allocation of either cash or in-kind payments could place worker-shareholders and their families at risk, unable to plow or sow their garden plots on time, or at a loss as to how to predict whether fattening animals for market for a period of months would result in a net loss or gain for the household.