ABSTRACT
Chapter 4 shifts the discussion from technicalities of corporate raiding to its base, corruption in the state apparatus. It pays a special attention to nepotism and how it plays in inheriting not the stream of income, illicit revenues, proceeds of corruption, access to graft, right to collect bribes, but the fundamental source of profit, that is, the enterprise, the company, the economic asset, the property itself. The practice of inheriting a public office is supplemented with the one of inheriting a private enterprise, company, or any piece of private property, including land. This seemingly axiomatic situation creates incentives for corrupt state bureaucrats to appropriate economic assets that they manage and formalize their property rights over these assets. And the best and most effective tool in securing not only the stream of bribes, but full-scale guaranteed profit participation is precisely raiding. Russia finds itself in a stalemate, or a low steady state equilibrium, where overwhelming well-being of the elites does not facilitate and in fact prevents an increase in socioeconomic well-being of the masses. Chapter 4 reflects on some legislative initiatives undertaken by leading Russian politicians and political bodies with the goal of curbing illegal raiding and corruption.
