Ukraine is trying, once again, to become a functioning democracy. Yet the war in Donbas, the slow pace of reforms, and the economic crisis are all impeding democratic consolidation. The seeds of the previous system remain, and they have the potential to undermine the achievements of the February 2014 revolution or, conceivably, thrust the country back on to an authoritarian path. Should they do so, it could damage the entirety of Eastern Europe’s democratic prospects for years to come: once again, Ukraine would be held up as an example of how attempts to establish democracy in the former Soviet Union can only lead to poverty and disarray.

Democratic Consolidation and the Power Vertical

Democratic consolidation is a necessary prerequisite for a democratic regime. Consolidation is the process that creates a lasting public demand for the separation of powers, an independent civil society, rule of law, and an economy that serves the majority rather than special interests.1

Ukraine’s history over the past twenty years has been marked by political contradictions and policy reversals. Before the Euromaidan protests, Ukrainians saw two revolutions (1990–1992 and 2004–2005) that held the promise of political and economic freedoms. Both ended with oligarchs presiding over a system that I call pluralist authoritarianism (this term is explained below).

By the time of the February 2010 elections, Ukrainians faced a choice between two presidential candidates with authoritarian agendas, Viktor Yanukovych and Yulia Tymoshenko (who had both served as prime minister by that time). By September of that year, the Constitutional Court had re-established superpresidential powers.2 Ukraine now had a nice democratic facade and a firm oligarchical core, and was fast becoming just another post-Soviet autocracy. Yet that same year, the facade started to decay.

At the start of Yanukovych’s presidency, Ukraine’s democratic institutions were both dynamic and fragile.3 There was a relatively free media scene, with outlets owned by a variety of financial-political groups (FPGs),4 among whom there was genuine competition. Elections were highly competitive and unpredictable. In short, the regime was partially accountable to its constituents, who occasionally had the chance to make their voices heard by the elite. Four years later, Yanukovych was forced to flee a country whose people had needed to stage an uprising just to get their leaders to listen.

The Power Vertical Rises and Unravels

By 2013, it was clear that Ukraine’s democratic facade was crumbling.5 Some opposition parties were coordinating their activities with the ruling FPGs. Those who opposed this sort of cooperation, like Yulia Tymoshenko or Yuri Lutsenko,6 were imprisoned after flawed legal proceedings. Media pluralism was on the decline. The government stopped trying to modernize its institutions or the economy.7 Rifts began appearing within the ruling Party of Regions, whose six main constituent FPGs were growing increasingly distant from one another. Viktor Yanukovych’s so-called Family clan concentrated power in its own hands, pushing the president’s former partners to the margins.

The Party of Regions controlled the Cabinet, the Parliament (Verkhovna Rada), and most local councils. Its leading FPGs also controlled most of the courts, the police, the tax administration, and major state-owned industrial companies—in other words, the lion’s share of the economy. By the end of 2013, conditions were ripe for Yanukovych to do away with pluralist authoritarianism and establish a model power vertical, with all power in the hands of the president.

In November 2013, pro-Europe demonstrators in Kyiv began their Maidan protests. Yanukovych’s inner circle made a series of fateful decisions that deepened the crisis and, ultimately, sealed his fate. After the legal coup d’état of January 16, 2014,8 civic protests turned into violent clashes, and the prospects for a political solution diminished greatly. FPGs that had long been allies of the Yanukovych Family turned neutral or switched sides altogether. Other FPGs that had been subdued by the violent practices of 2010–2013 stopped cooperating with the president and threw their support behind the protesters. Pro-Euromaidan groups took control of local administrations in several regions. As the crisis played out, Yanukovych lost control over key government components and a large part of the country. Under the supervision of the foreign ministers of Germany, France, and Poland on the night of February 20, 2014, Yanukovych and the Euromaidan leaders hammered out a compromise solution. Yet the following day, Yanukovych fled to Crimea, then to Russia. His power vertical had collapsed after only a few months of existence.

The Composition of the Power Vertical

Ukraine entered the post-Euromaidan period with state institutions that had been designed for authoritarian rule. The comprehensive reforms that started in spring 2014 were meant to unite Ukrainians around a new democratic, decentralized system. Yet the new leaders failed to establish effective checks and balances. This failure gave the country’s authoritarian institutions a chance to adapt and to live to fight another day.

Under Yanukovych, the degeneration of the handful of democratic institutions that Ukrainian society had managed to establish in the post-1991 period coincided with the formation of other distinctly authoritarian institutions. These institutions are key elements of the so-called post-Soviet power vertical.

The system was pioneered in the 1990s in President Alexander Lukashenko’s Belarus and former president Boris Yeltsin’s Russia, and later perfected under Russian President Vladimir Putin. Under the post-Soviet power vertical, nominally separate branches of power and institutions, including local institutions of self-government, are merged into a single top-down structure.9

Formal institutions—the presidency, cabinet of ministers, parliament, local councils, and courts—function according to two parallel codes. On a nominal basis, they are formally subject to the written law. In reality, they must follow the unwritten rules of the vertical. Formal legislation is never fully implemented, and the social contract consists of a series of shadow rules. In the case of Ukraine under Yanukovych, the courts served, in practice, as a tool to legitimize corporate raiding.10 The police tend to function both as a state-controlled racket and, to a much lesser extent, as the provider of security for the general public.

The cabinet of ministers manages shadow financial flows in parallel with its role as the core of the executive. The real government—in terms of decision and policymaking—is usually the Presidential Administration (PA), an entity that is rarely defined by law or the constitution in post-Soviet regimes. A sort of successor to the Soviet-era Communist Party Central Committee, the post-Soviet Presidential Administration is the focal point of the power vertical, making strategic decisions and monitoring implementation at all levels.

There are key differences between the power verticals of Ukraine, Russia, and Belarus. In Russia, the functions of the Central Committee were transferred to the Presidential Administration, which is commonly referred to as the Kremlin. While this transition was not smooth, it was largely completed thanks to the adoption of the 1993 superpresidential constitution. Since then, major decisions on domestic, international, and local issues have been made in a largely systematic fashion.

For about two decades, Belarus has been the regional trendsetter and a laboratory for post-Soviet authoritarianism. Alexander Lukashenko’s regime, which was established in 1996–1997, put the Presidential Administration above all other institutions of the state. Yet Belarus has lacked the human capital to fulfill all of the PA’s functions. These limitations have forced Lukashenko to play a lead role in both strategic and tactical decisionmaking.

In many respects, Ukraine has been relatively successful in nation building, but it has lagged behind its neighbors where state building is concerned. Unlike Russia and Belarus, Ukrainian formal political and government institutions have often functioned at a bare minimum, with one exception: by 1999, the Presidential Administration had developed into the country’s leading institution.

Ukraine’s Presidential Administration was built in accordance with the Belarusian model, but it was also a forum for dialogue among different regional FPGs. In a way, the Presidential Administration continued the Soviet tradition whereby the Central Committee of the Ukrainian Communist Party in Kyiv included regional power brokers from Kharkiv, Donetsk, and Dnipropetrovsk.11 The Presidential Administration’s dual function, along with the weakness of other state institutions, helped Ukraine’s oligarchs develop a form of pluralistic authoritarianism.

Pluralistic authoritarianism is a highly contradictory political model. It demands that the president be an impartial broker who balances the interests of key FPGs, yet it also allows him to function as the country’s sole ruler. As such, the model has several built-in weaknesses that limit its lifespan. For example, it lacks institutional mechanisms that commit the president to impartiality.

In Ukraine, parliament has never been subdued to the degree that it has been in Russia (since 1993) or Belarus (since 1996). Much of the history of independent Ukraine can be reduced to the long-running competition between the institutions of the presidency and the parliament, in which the names of players may have changed while the nature of the competition has remained the same. Even during periods of growing authoritarianism under Leonid Kuchma and Viktor Yanukovych, some semblance of balance survived, thanks to the formal autonomy of parliament and the informal autonomy of FPGs. The parliamentary opposition, whose democratic credentials were hardly stellar, nevertheless helped preserve a degree of political and media pluralism that limited the president’s ability to exercise his power arbitrarily.

Pluralistic authoritarian systems appeared on two separate occasions in Ukraine—near the end of Kuchma’s 1994–2005 rule and in the final months of Yanukovych’s presidency. In both cases, they disintegrated almost immediately when the president attempted to promote himself to a Lukashenko-style position and ceased to be an honest broker of the system. Rivalries among key FPGs then reached a breaking point and toppled the newly formed power vertical.

Both of these so-called revolutions gave Ukrainians a chance to go back to the drawing board, establish democratic institutions, and free the economy from the grip of oligarchs. Opposition to Kuchma and Yanukovych helped unite a chunk of the political elite, as well as key segments of the population, around the goal of bringing down an authoritarian leader. Yet in both cases, these united fronts fell apart before they could rebuild the country’s political system.

System in Shock

Between December 2013 and March 2014, Ukraine’s second power vertical collapsed.

The initial catalyst for the collapse was the police’s heavy-handed response to youth protests in late November 2013, which spurred mass demonstrations the following month. The Euromaidan protesters took over several administrative buildings in Kyiv and the surrounding regions, and by the end of December, the Yanukovych administration had lost control of parts of Ukraine’s territory.

The second watershed moment was the legal crackdown that Yanukyovch pushed through the Rada on January 16, 2014. On that day, a group of pro-Yanukovych MPs, who did not actually have a majority in the Rada, voted for a package of laws that were copied and pasted from Russian measures adopted in the wake of the 2011–2012 street protests in Moscow and other large cities. In the Russian case, the measures had been introduced slowly and enjoyed the full support of the Duma and the Kremlin-controlled media. The suddenness of their imposition in Ukraine radicalized the protest movement and led to the first deaths in the streets of Kyiv. Some FPGs turned on Yanukovych in the hope that they could sacrifice the regime to save the system. Officials who had previously been loyal to the president switched sides covertly and sabotaged government orders.

The third major blow to the regime came on February 19–21, 2014, when clashes between police and protesters devolved into mass bloodletting. Despite the agreement reached between the president and opposition leaders, Viktor Yanukovych and his entourage unexpectedly fled the capital on February 21. By that time, most FPGs affiliated with the Party of Regions had stopped supporting the Family.12 This decision was heavily informed by their experience after the 2004 Orange Revolution, when the new leaders had been reluctant to punish the losing side. Many FPGs that had supported Yanukovych’s campaign actually prospered under Viktor Yushchenko’s mild regime (2005–2010). By the end of the Euromaidan, most influential FPGs felt that a political reset could be lucrative. And so the short-lived power vertical fell, creating an opening for the political leaders of the Euromaidan to govern the country.

Unfortunately, the new government quickly proved ineffectual in its first weeks and months in power. Several regions in the southeast of the country immediately slipped beyond its control. By May 2014, Crimea and parts of Donbas had been lost to the Russian army and Russian-backed separatists. With the police and army in shambles, the state forfeited its monopoly on violence and security, giving way to self-defense groups that had risen to prominence during the Euromaidan protests on one side, and to separatist fighters on the other.

With the power vertical shattered, bold steps were taken toward democratic renewal. The new leaders restored the constitution of 2004, which mandated a parliamentary-presidential system, and returned some of the political liberties that the Yanukovych regime had erased. Yet the slow pace of reforms, the rise of old and new FPGs, and the fact that the demands of wartime often seemed to contradict and overshadow the democratic promises of Euromaidan all laid the foundation for the return of elements of the old system.

A Partial Recovery

Over the last ten days of February 2014, the Verkhovna Rada, the only institution that had continued to function throughout the crisis, took urgent steps to convey legitimacy to the new order. Under pressure from protesters, the parliament managed to form a more or less stable majority that could pass critical decisions, including the restoration of the 2004 constitution.

The parliament also appointed new heads to most government entities. Oleksandr Turchynov, a long-time partner of Yulia Tymoshenko who had led the Batkivshchyna party while she was in prison, became the acting president and speaker of the Rada. Arseniy Yatsenyuk, an ambitious politician who had formerly served as speaker of parliament and minister of foreign affairs, was appointed acting prime minister of the interim government. The interim administration began the offensive against separatists and returned southeastern Ukraine, with the exception of occupied Crimea and the breakaway parts of Donbas, to Kyiv’s control by June 2014.

On February 21, 2014, the day parliament restored Ukraine’s parliamentary-presidential system, it also set dates for elections: a new president would be chosen on May 25 and a new Verkhovna Rada on October 26. These elections proceeded in a more or less open and transparent manner, and brought Petro Poroshenko to power, followed by a pro-reform coalition with a constitutional majority of over 300 votes.

Thus, by the end of 2014, Ukraine’s new political order had largely gained legitimacy. The promise of new political and economic freedoms was crucial to this process—and could have fueled a full, democratic recovery.

A Distorted Recovery

So is the Ukrainian political system finally on a trajectory toward developing into a stable democracy? Have Ukraine’s leaders learned the hard lessons of the post–Orange Revolution oligarchic renaissance? Sadly, no. Instead, the country’s democratic development is being shaped by six harmful political trends, all of which were evident by the end of October 2015.

Competition Within the Executive Branch

Competition between the president and the prime minister is one of the gravest threats to democratic consolidation in Ukraine. This competition, which at times takes the shape of rivalries between the FPGs surrounding either leader, is holding back the reform process and providing oligarchs with substantial leverage. The executive branch is essentially repeating the mistakes of 2004–2006, when the parliamentary-presidential system turned the president and prime minister into first institutional and then personal rivals.

While the 2004 constitutional change provided an effective short-term solution to a conflict that threatened to turn into a civil war, it created long-term systemic obstacles to consolidation in the executive branch. The shift to a parliamentary system was part of a compromise between the pro-Yushchenko and pro-Yanukovych factions. In return for a third—and honest—round of presidential elections, the Orange coalition agreed to transfer some of the president’s power to the prime minister and parliament. Yet the Orange faction soon dissolved amid constant clashes between a weakened president and an increasingly powerful prime minister.

By the end of his presidency, Yushchenko’s approval ratings had fallen to single digits. Yanukovych capitalized on popular disaffection and was elected president in February 2010. A highly questionable ruling by the Constitutional Court that September reestablished a presidential republic and gave Yanukovych powers that were not part of his electoral mandate. Many experts supported this motion in the hopes that presidential rule would make the long-promised reforms a reality.

The reinstatement of the 2004 constitution in 2014 served to check the power of the president. It appeared that the new leaders had absorbed the lessons of Yanukovych’s rule. Yet instead of uniting around the common tasks of democratic reform and fighting Russian-backed separatists, the major players in Ukraine’s executive branch soon focused their energies on competing with each other.

Poroshenko’s and Yatsenyuk’s cohorts have shown they are capable of compromise on tactical issues and cooperation to ensure Western support for Ukraine. Yet the two teams, each of which has its own FPGs as well as its own new civic and political groups, clearly have different strategic agendas. It is becoming increasingly difficult for the two leaders—let alone their respective teams—to find common ground, as the coalition’s voting pattern shows.

The lack of consolidation within Ukraine’s executive branch is slowing the reform process, which plays into the hands of oligarchs and contributes to popular frustration and disappointment.13 Dysfunction within the executive branch is setting the stage for a possible repeat of the 2009 scenario, in which the public conveyed its wish to be governed with a “strong hand” and actively supported an authoritarian turn.

Executive Control over the Legislature and Judiciary

The FPG that wins the battle for the executive branch will also hypothetically gain control of the courts and the passage of legislation. This opens the door for public-private actors to keep and expand their property interests through illegitimate means.

Today, the competition between the president’s and prime minister’s factions is sapping the independence of the other branches of power. By taking advantage of the quota system in the Ukrainian legislature, both Poroshenko and Yatsenyuk have been able to secure key appointments for their loyalists. These quotas have also allowed the ruling coalition to establish control over numerous parliamentary committees and ministries. Poroshenko’s FPG controls eleven ministries and eleven parliamentary committees, while the groups around Yatsenyuk control four ministries and eight committees. In recent elections to the High Judiciary Council, one of the key self-governing bodies of the judiciary, the same quota principle produced a council composed primarily of loyalists to the two leaders. A pro-presidential judge was chosen to preside.

These are just several examples of how today’s Ukraine conforms to a broader post-Soviet phenomenon: a sharp contrast between formal and real power relations, where distribution of wealth and power is often governed by informal rules. With a president who effectively controls most members of the cabinet, and a prime minister who can influence the decisions of certain courts, it is clear that the roots of the power vertical are still alive and well in Ukraine, thanks in large part to the parliamentary quota system.

The Marginalized Parliamentary Opposition

The state of today’s parliamentary opposition is lamentable. The Opposition Bloc faction, the Radical Party faction,14 and other groups that are not part of the coalition do not control a single parliamentary committee. The current leaders seem to have forgotten the demands that they themselves made in 2012 while they were in the opposition to preside over parliamentary committees on regulations and/or mass media. Strengthening the role of the parliamentary opposition is not on any reform agenda. As in the Yanukovych era, the opposition is kept in the political margins, and key opposition MPs are subdued by the threat of criminal prosecution.

The major opposition group, the Opposition Bloc faction, consists of former supporters or associates of the Yanukovych administration. Several smaller MP groups are mostly made up of lobbyists for various FPGs who are not yet affiliated with either Poroshenko or Yatsenyuk. None of these groups is by any means a democratic champion, but their marginalization renders parliamentary opposition, a traditional check on unlimited executive power, less effective.

The post-Soviet tradition of a politicized prosecutor general has also been revived. Upon the breakup of the USSR, the prosecutor’s office became a key mechanism for ensuring presidential control over political and business elites in Russia, Ukraine, and Belarus. After both the Orange Revolution and the Euromaidan, the office’s political role was for a short time diminished. But as soon as order was restored, both Yushchenko and Poroshenko began to use the prosecutor’s office as a weapon in their struggles with parliament.

Today, several MPs from the Opposition Bloc are under criminal investigation. While some of these investigations appear to have a concrete basis, the processes by which the cases were opened and reviewed in parliament strongly suggest political motives. For example, the Verkhovna Rada’s regulations committee (rehlamentnyi komitet) is, as of early 2016, sitting on numerous cases from the prosecutor general’s office that would lead to the loss of parliamentary immunity for certain MPs. These files have been parked there for several months, and now resemble political tools more than legal documents: they are used to harness votes for presidential draft legislation when coalition members are not eager to cooperate. This tactic was used in the controversial August 31 vote on a proposed constitutional decentralization package, to ensure that opposition delegates voted for the measure. Their support helped make up for coalition members who abstained. The prosecutor general’s renewed political power is yet another instance of Ukrainian democracy sliding backward.

For most of 2015, the Verkhovna Rada has looked more like a vote-producing factory than an independent legislature. The ruling coalition consistently casts votes without actually reviewing the underlying legislation they are voting for. It has become commonplace for faction leaders to force coalition MPs to vote on drafts without giving them proper time to discuss them, even with other coalition members. A growing number of laws have been approved by the so-called shortened procedure, in which all readings are done in the fastest way possible, preventing both discussion and revision of the laws. This voting practice severely undermines the process of democratic consolidation, as evidenced by the recent fragmentation of the ruling coalition.

The marginalization of the parliamentary opposition has one other key implication: if the systemic opposition fails to perform its critical function, the antisystemic opposition could potentially take up this role. That is, the communists and former Party of Regions members in the eastern regions, along with radical right-wing forces in the central and western regions, could over time gain more popular support, which presumably would diminish Ukraine’s democratic prospects.

The Slow Recovery of the Party System

A democratic party system could help to jumpstart democratic consolidation in Ukraine. Since the Euromaidan, however, one-leader political projects have dominated the parliament.

Ukraine’s party system has changed radically since the Euromaidan. Every party in the parliament is either new or was entirely reconfigured between February and August 2014. Yet the majority of the votes in the Rada belong to the Petro Poroshenko Bloc, Yatsenyuk’s National Front, Tymoshenko’s Batkivshchyna, Lviv Mayor Andriy Sadovyi’s Samopomich,15 and Oleh Lyashko’s Radical Party.16 Behind each of these parties is one leader and one FPG (or several FPGs with strong mutual ties). The parties are structured to serve the personal agenda of their leader and/or their narrow group of owners. This agenda often requires merging the public, political wing of the organization with its corporate wing. The CEO of Petro Poroshenko’s corporation could thus become a leader of a parliamentary faction, while a middle manager could be appointed to a regional state administration.

These one-leader parties are usually short-term projects.17 Led by one popular figure, they often last for several years between elections and lack a clear ideology. They have a negative impact on the democratic process, damaging the public’s trust and feeding support for populism and/or radicalism. Parties that try to establish wide membership networks on the basis of social and class identities or specific issues of concern to the electorate usually lose out to these heavily personalized organizations. Thus, parties like the liberal Democratic Alliance or the radical Svoboda are fated to remain outside of parliamentary politics, and the limited appeal of personality-based parties could strengthen the appeal of the nonsystemic opposition.

Recentralization

One of the promises that Euromaidan leaders made to their supporters and to society as a whole was to decentralize state power. Over the previous decades Ukraine had developed into a highly centralized state, which was a key factor in the emergence of nondemocratic regimes.

The new government took its first important step towards decentralization in December 2014, when parliament made amendments to the Budget Code. Two taxes were introduced that were intended to provide resources for local self-governing bodies.

Yet from May to August 2015, amid extensive debate, parliament prepared a package of constitutional amendments on decentralization that made it clear that Kyiv was reluctant to share power with local communities. Under these proposed amendments, which the Rada passed on the first reading, the president would appoint prefects who would have the right to veto the decisions of the elected local councils or even dissolve the councils altogether. The authorities argued that this system would safeguard against the adoption of pro-separatist policies at the local level. But it remains hard to square the suggestion that the redesign of Ukraine’s political system must be geared toward mitigating a potential separatist threat with a clear desire to treat local councils, once again, like junior partners. If this element of the decentralization package is approved in its current form, it will strengthen the central government without creating any mechanism to counterbalance it.

The Return of the Oligarchs

Of the myriad threats facing Ukraine today, the potential return of the oligarchs is probably most salient to the public. While the Euromaidan and the economic crisis have both reduced the role of oligarchs in political and economic life, their chances of making a comeback are high.

The financial resources of the “old” oligarchs have for the most part diminished. As Balázs Jarábik and Yuliya Bila point out, the total net worth of the five richest and most influential Ukrainians (Rinat Akhmetov, Victor Pinchuk, Ihor Kolomoyskyi, Hennadiy Boholyubov, and Yuriy Kosiuk) has dropped from $21.6 billion in 2014 to $11.85 billion as of June 2015.18 As their net worth has decreased, so has their political influence. The once-almighty Rinat Akhmetov is under investigation and consequently retains very limited influence in parliament and in the Cabinet of Ministers.19 Victor Pinchuk keeps his distance from politics; his political influence is largely channeled through his father-in-law Leonid Kuchma’s participation in the Minsk peace process. Yuriy Kosiuk has abandoned his position in Poroshenko’s administration and has largely tried to stay out of politics. Only Ihor Kolomoyskyi and his Privat Group are still active on the political scene.

Yet the new era has created new financial-political groups of minigarchs, as they are ironically called. These minigarchs are using their newfound momentum to gain both power and property, and quite a few sit on committees in the Verkhovna Rada. Owners of big agricultural corporations are also coming out of their sectoral ghetto and taking a more forceful position in the national and regional political arena.

Perhaps the biggest concentrations of prospective oligarchs are gathered around President Poroshenko (who combines his role as head of state with a variety of oligarch-style tendencies) and Prime Minister Yatsenyuk.

In recent months, the most visible oligarchic behavior has come from Kostiantyn Hryhoryshyn and Ihor Kononenko—members of the presidential entourage—and from Mykola Martynenko and Andriy Ivanchuk, of the prime minister’s retinue. Their private battles for control of not-yet-privatized companies and, increasingly, their public conflicts, with mutual accusations of criminal activity, have deeply eroded the public’s trust in both the president and the prime minister since August 2015.20

The principle of the post-Soviet oligarchy—in which political and financial control are merged, resulting in those with political power also controlling state-owned companies—is still at work in post-Maidan Ukraine. This merger may play the same coercive, antidemocratic role that it did in the 1990s and in the post-Orange period.

Mitigating Risks

Given the dynamic nature of the political situation in Ukraine, all of the issues that I discuss in this section constitute potential or actual risks that are likely to have a negative effect on how the country develops in the near to medium term. Unfortunately, there are plenty of signs that several of these threats are materializing and beginning to do real damage. When it comes to political and economic liberties in the post-Soviet space, the past decades suggest that Murphy’s law applies here: if there is an opportunity for these freedoms to be lost, they most likely will be.

What can be done to mitigate these risks? How should they be handled if they become a reality?

Effective institutions have thus far been the single most important factor in Ukraine’s democratic progress. The widespread belief that new cadres educated in a non-Soviet context would be sufficient to help Ukraine establish a “normal” society, economy, and political process has proven to be wrong. Two new generations of leaders have assumed power since the collapse of the USSR, but formal and informal Soviet-style practices and post-Soviet habits remain endemic.

The answers to what ails Ukraine are likely to sound, by turns, utopian or even naive to most outsiders. Many of the underlying problems are discernible in other transition countries but usually in less extreme forms. In post-Soviet countries, real progress on the institutional front would probably require abolishing the presidency altogether, as the institution is often used as a shortcut to authoritarian rule. More attention should be paid to the separation of powers. Some Western friends believe that a duumvirate executive system like Ukraine’s is an effective means of preventing authoritarianism. But the cost of such a system, Ukrainians have found, is its undermining of democratic consolidation. A better mechanism would be an effective separation of powers. Creating a strong and effective system of checks and balances should be a priority of constitutional and political reforms.

With these considerations in mind, it’s conceivable that Ukraine might do better to implement a parliamentary model. Parliamentary systems in the post-Soviet context have had varying success. In Estonia, a parliamentary system brought sustainable political and economic development to a fragmented nation. Moldova’s experience with the model has been far less rewarding. Of course, the Ukrainian constitutional commission and current ruling coalition should weigh the pros and cons of the parliamentary system and assess how they might fine-tune it to Ukraine’s needs. Yet reformers should not allow this historic opportunity to pass by.

As far as the ongoing constitutional and administrative-territorial reforms are concerned, Ukraine must return to its founding idea of sobornist: unity in plurality. Sobornist was one of the main ideas that drove over 90 percent of Soviet Ukrainians to support independence in the 1991 referendum. The right of local communities to govern themselves must be recognized as a bedrock principle of the state, and it should feature in any new constitution and function at all levels of the political system. Parties and civil society groups who remain loyal to the ideals of the Euromaidan should pressure elites to follow through on their promise of local self-governance.

Another key goal of the current reforms is to establish an economy in which small- and medium-sized businesses can function freely, and where state-owned companies are subject to reasonable regulations. Leaders should strive to reduce the number of citizens dependent on the state budget. These groups have historically formed the base of the patron-client system that enables authoritarian consolidation. Creating a meaningful political and legal infrastructure (no small feat) that allows for competition should be a central task of both economic and political reforms. At the same time, the role of state-owned companies must be reassessed from a harm reduction perspective. As the post-Soviet experience shows, exploitation of publicly owned companies is the key to oligarchs’ staying power. The pro-democracy parties in the Rada must take responsibility for creating favorable economic conditions for self-employed citizens, small- and medium-sized businesses, and state-owned companies.

Under attack from within and without, Ukraine cannot build a democratic future without Western support. Both financial and security assistance are critical to the state’s survival. Yet there is one caveat: Ukraine’s friends should recall their experiences providing aid to other post-communist countries, and enforce strict conditionality, especially regarding control over powerful elites, to ensure that their support achieves its desired aims.

Constructing a new democracy in Ukraine will take extraordinary care and vigilance. It will require the growth of stronger state institutions, while also demanding that leaders make do with less power and influence than they have previously enjoyed. It will require that citizens play an active role in economic and political life. Only by meeting these goals can Ukraine develop the only true safeguard against the return of authoritarianism and oligarchy—a citizenry that feels genuine ownership over the democratic process. At present, the risks outlined here threaten to derail Ukraine’s progress toward these goals, and in doing so, dampen democratic prospects for all of Eastern Europe. Ukrainian citizens, officials, and their Western partners should treat these emerging risks with the urgency that these high stakes demand.

Notes

1 For more on this issue, see Larry Diamond, Developing Democracy. Toward Consolidation (Baltimore and London: The Johns Hopkins University Press, 1999); and Elisabeth Bakke and Nick Sitter, “Patterns of Stability and Strategy in Central Europe since 1989,” Party Politics 11, no. 2 (March 2005): 243–63.

2 On September 30, 2010, the Constitutional Court of Ukraine declared the parliament’s December 8, 2004, change to the constitution illegal. The 2004 decision ended the political impasse during the Orange revolution by introducing a parliamentary-presidential system. The Constitutional Court’s 2010 decision restored the presidential system following Viktor Yanukovych’s electoral victory, giving him powers that were not part of the bargain during the election.

3 On this subject, see: David Kramer, Robert Nurick, Damon Wilson, and Evan Alterman, “Sounding the Alarm: Protecting Democracy in Ukraine,” Freedom House, April 2011, https://freedomhouse.org/sites/default/files/inline_images/98.pdf.

4 Hereafter, I will refer to those groups that dominate both the political and economic sectors as financial-political groups (FPG). In doing so, I seek to substitute the negatively-charged term oligarchic clans with one that is more descriptive. De facto, a typical post-Soviet FPG consists of a group of key owners, the public figures and political parties that they own, a group of prominent judges, a parliamentary faction, a group of private companies, a group of companies that belong nominally to the state but whose management works for the FPG, and a media holding. Since the Euromaidan, many also feature a network of NGOs and often a volunteer paramilitary battalion. Thus the FPG is a strong informal institution that can advocate for its owners’ private interests, compete in post-Soviet politics and—under certain circumstances—become an integral part of the “power vertical.”

5 For more on this disintegration, see: Pietro Grilli di Cortona and Barbara Pisciotta, “The Ukrainian Political System from Independence to Democratic Involution” in Ukraine Twenty Years After Independence, eds. Giovanna Elisabeth Brogi, Marta Dyczok, Oxana Pachlovska, and Giovanna Siedina (Rome: Aracne, 2015), 101–18.

6 Yuri Lutsenko was one of the leaders of the Ukraine Without Kuchma movement from 2001 to 2003, interior minister  from 2005 to 2006, and a political prisoner under Yanukovych from 2007 to 2010.

7 There was a group of “modernizers” in Yanukovych’s inner circle from 2010 to 2012, but their influence had diminished by the 2012 parliamentary elections. These elections changed the balance of power among FPGs affiliated with the Party of Regions: the Family group (nominally led by Viktor Yanukovych, but led in practice by his elder son Alexander) concentrated most political, administrative and economic power in its own hands.

8 This refers to the passage of a package of draconian measures by a de facto minority of pro-Yanukovych MPs aimed at suppressing the protest movement. The Rada’s actions spurred a new, more radical phase in the Euromaidan protests, contributing to the first deaths of protesters and police.

9 Andrew Monaghan, “The Vertikal: Power and Authority in Russia,” International Affairs 88, no. 1 (2012): 1–16; Vladimir Gel’man and Sergei Ryzhenkov, “Local Regimes, Sub-national Governance and the ‘Power Vertical’ in Contemporary Russia,” Europe-Asia Studies 63, no. 3 (2011): 449–65.

10 On corporate raiding see: Matthew Rojansky, “Corporate Raiding in Ukraine: Prevention, Defense, and Policy Reform,” Review of Central and East European Law 39, no. 3-4 (2014): 245–89.

11 More on this topic in: Mikhail Minakov, “Postsoviets’ka nesuchasnist’ respubliki regioniv” [Post-Soviet pastness of republic of regions], Krytyka, September 2013, krytyka.com/ua/articles/postsovietska-nesuchasnist-respubliky-regioniv.

12 The Family group tried to use the protests to bring the Cabinet under its full control; the prime minister and other key ministers were replaced with clan members in January and February 2014.

13 Natalya Kharchenko and Volodymyr Paniotto, “The Current Situation in the Ukrainian Society,” Kiev International Institute of Sociology, May 2015, http://www.kiis.com.ua/?lang=eng&cat=reports&id=529&page=1.

14 The Radical Party of Oleh Lyashko declared itself an opposition party in early September 2015. Their stated reason for leaving the coalition was the government’s attempts to pass constitutional amendments in favor of separatists. But there is also some indirect evidence that the party leadership has begun cooperating with a major FPG that is a competitor with President Poroshenko’s group.

15 Andriy Sadovyi has been mayor of Lviv since 2006 and is the leader of the right-centrist Samopomich Party.

16 Oleh Lyashko is a right-wing populist politician. He has been an MP since 2006 and is the leader of the new Radical Party that was a member of the ruling coalition from November 2014 to September 2015. Only the Opposition Bloc currently includes a wide representation of FPGs, a trait once associated with the Party of Regions.

17 There are exceptions among the personal parties. For example, the Batkivshchyna Party has been controlled by Yulia Tymoshenko since 2002.

18 Balasz Jarabik and Yuliya Bila, “And Then There Were Five: The Plight of Ukraine’s Oligarchs,” Eurasia Outlook (blog), Carnegie Moscow Center, June 17, 2015, http://carnegie.ru/eurasiaoutlook/?fa=60429. The same trend is reflected in a more recent ranking of the Ukrainian rich: “Top 100 samykh bogatykh ukraintsev” [Top 100 richest Ukrainians],  Novoye Vremya, October 30, 2015, http://nv.ua/publications/nv-40-sostavlen-top-100-bogatejshih-ukraintsev-76798.html.

19 During the October 2015 local elections, some local groups and mayors were elected with the help of heavy support from Akhmetov. Yet on the national level, his political role is diminishing.

20 All of the listed persons have been actively giving interviews to press accusing each other’s side of improper policies and crimes. See Sevgil Musaeva-Borovik and Pavel Sheremet, “Konstantin Grigorishin, ‘Pravitel’stvo Yatsyenyuka vozglavlyayet koruptsiyu’” [Konstantin Grigorishin, “Yatsyenyuk’s Government leads corruption”], Ukrainskaya Pravda, September 29, 2015,  http://www.pravda.com.ua/rus/articles/2015/09/29/7082971/; Andrei Ivanchuk, “U Poroshenko net pretenziy k rabote Yatsenyuka. Ne bylo, net, i, dumayu, ne budet” [Poroshenko has no complaints about Yatsyenyuk’s work. Has does, does not, and, I think, will not], LB, November 15, 2015, http://lb.ua/news/2015/11/15/320788_andrey_ivanchuk_u_poroshenko.html; Nikolai Martynenko, “Sravnivat’ menya s Kurchenko - nekorrektno” [To compare me to Kurchenko is incorrect], Liga Business, November 18, 2015, http://biz.liga.net/all/tek/intervyu/3161615-nikolay-martynenko-sravnivat-menya-s-kurchenko-nekorrektno.htm; Yuliya Mostovaya, “Glava administratsii prezidenta Boris Lozhkin: ‘K gossluzhbe otnoshus’ kak k sluzhbe v armii” [Head of the presidential administration Boris Lozhkin: “I will treat the civil service as I did the military service”], ZN.UA, November 13, 2015, http://gazeta.zn.ua/internal/glava-administracii-prezidenta-boris-lozhkin-k-gossluzhbe-otnoshus-kak-k-sluzhbe-v-armii-_.html; Sonya Koshkina, “Igor Kononenko: ‘Narod Ukrainy golosoval za biznesmena. Eto byl osoznanniy vybor’” [Igor Kononenko: “The people have voted for businessmen. It was a conscious choice”], LB, September 11, 2015, http://lb.ua/news/2015/09/11/315739_igor_kononenko_narod_ukraini.html.