Everyday Tactics and Spaces of Power: The Role of Informal Economies in

Post-Soviet Ukraine

“Emerging dimensions of social inequality in Russia and Eastern Europe”

Dr John Round

Contexts

Officially ten million people (20 percent of the population) are considered ‘in poverty’

Uses the concept of the state set subsistence minimum (483 UAH Jan 2006, 701UAH (91US$) Oct 1st 2008 but core prices have more than doubled in this time)

Is it possible to live on this figure? Assumes a functioning ‘market economy’…

‘My ulcers are hurting and my blood pressure is high but there is no point me going to the hospital because they just want too much money from me.’

‘Yes but you are pensioner should not medical care be free?’

‘What are you talking about it makes no difference if I am a pensioner or not. All they are interested in the 50 Hryvnas in their pocket. Recently I went to the hospital as I had angina and I saw the doctor but because I could not pay he just walked off. For pensioners there is no point going to the hospitals we just have to rely on our children.’

senior citizen, Kyiv, February 2006

Many responses 56 percent of respondents placed formal employment as first

work strategy

– But only 10 percent rely on this alone; 19 percent use employment and cash in hand work, 16 percent employment and help from family and friends and 11 percent employment and self provisioning

Overall 78 percent of respondents stated that informal work contributes to the family budget of which 86 percent believe it is either extremely important or important to their household budget

Domestically grown food is also important to many households with 35 percent of respondents having access to land. Of this figure 76 percent stated that the food they grow is either very important or important to their household’s daily diet.

Underworking

“I’m an engineer and I have done this job for a long time. I wish that the wage could correspond more to the cost of living. Because 600-700 UAH [about £80 per month at the time] is simply not enough to live on. This is not money. It is just about enough to feed my family but I need more to clothe it. My wage does not correspond to the work we do, I wish it could be bigger but it is not so I have to spend most of my free time under working.”

State employee, Kyiv, March 2006

Connected with formal work – diverting of clients/stealing

“Almost everyday I take goods from work everyone does it including the bosses so there is not much chance of losing my job because of it. Some days we can take kilogram’s of meat without anyone important noticing. We use some of it at home and some we share with friends but often we sell it to people on the market for them to sell”

‘I don’t buy food anywhere as I don’t have any means to do it. I cannot afford meat or fish. Vegetables have become so expensive if you only have a pension to survive on. I only eat what I can grow on my plot of land.’

Senior citizen, Kyiv, 2007

Subsistence food production

Reselling of goods

Domestic production of food – sharing or selling of excess

Micro-enterprises – selling of food/flowers/property development/renting rooms

Tactics and strategies

How can such practices be conceptualised?

How they are viewed is important in state thinking – attempts to ‘cheat the state’?

Distinction should be made between different forms of informal practice – responsive/exploitative

Furthermore there is no system because there are so many sub-systems situated, as we have seen, not within a single system but at different levels of reality, the lacunae and gaps between them filled with floating mists… (emphasis in original) Lefebvre, 2000:98

[s]trategies are able to produce, tabulate, and impose these spaces, when those operations take place, whereas tactics can only use, manipulate, and divert these spacesde Certeau, 1984:36

“Eventually you know the shifts of the militia who will not ask you for too much money. So you go and sell your goods between 12 and 2 on a Thursday for example as you know the guy who is working that shift and he is ok. If you go and someone else is working it is easier just to walk away. Some of them will look after you after you give them some goods. Others just want to cause trouble.”

Most tactics take place through networks which operate across spaces

– Apartment buildings

– From the household to another location

– Across communities

– At/through the workplace

– Between locations

Almost all rely on informal social networks built on trust and reciprocity

“My friends help me. They tell acquaintances that I can change a pipe or something, so people come to me. People just help each other. In our circle of acquaintances we all help each other. My friends have my mobile phone number, they call me and we make arrangements - this how it happens.”

“Of course this relationship is not only one way [of providing information about work availability]. So at some point I have to give something in return for the information. If I don’t help in return no one will help me the next time I need something.”

The informal supporting the formal

Sites of resistance or exploitation?

Strategies: the informal nature of formal work Many people are paid two wages – one formal (and

taxed) the other cash in an envelope at the end of the month

Over a third of people receive part of their wage on an informal basis –ranging from 20 to 80 percent of their income

25 percent reported problems in receiving their informal wage

While this seems advantageous – lower tax payments – in fact many people wish for their wages to be formalised

Corruption Corruption pervades all sections of society – dealing with

bureaucracy, health care, enterprises and the education system

Corruption can be seen as a positive as it allows ‘things to get done’

Raising wages alone will not solve the problem Barrier to formalisation, growth, diversification, small

business development and regional development How can it be combated?

Overview

For many informal work is extremely important to their daily lives

Many do not wish for this work to be informal Can we talk about a ‘market economy’ in post-

Soviet states? Difficult to discuss state policy as there is so little of

it – apart from ‘the market will sort it out’