The Role of the State. Tree branches of power

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In Russia there is a debate on the role of the State in a market economy, which is closely connected with the definitions of decentralization, federalism and also connected with the possibilities and effectiveness of the actions of the government and different State institutions. After the courts of the centralized system of government, expectations of and confidence in the organizational and political functions of the market increased. Moreover, in a transition economy it is irrelevant to make choices between market and State as they both should play a strong role in society.

No doubt, a weak state with a low level economy has difficulties in accomplishing the main tasks mentioned to help the development process of society. The main issue in the politics of development of the State is the ability of the government and its structures of State control to develop and improve these aspects. It is very important to underline the problem of the " right" position of the State. Its real role will be defined on the basis of important factors such as changes in economic and social development, national peculiarities and traditions, together with some other issues. The most widespread opinion seems to be that the significance of the State in the development of economic life is inadequate, its role being extremely limited and, moreover, ineffective.

There is a necessity to create a legal basis for the protection of citizens from the influence of State bureaucratic structures. Bureaucracy, in the terms of Max Weber, means a factor that balances various interests in society. A bureaucracy working in a predictable way would, in Weber's opinion, be better for the interests of the masses than a constantly changing corps of officials with great powers to solve matters in casu. When the authorities' actions are based on the law, the citizens have the opportunity of assessing independently when and what kind of measures they undertake with the authorities. Citizens must be protected from threats such as corruption in connection with the bureaucratization of the State apparatus. Otherwise, one could say that this state has definitive limitations in its activity differentiating from other organizational forms in society. The experience of the planning model of economics up to the 1970's showed that heavily centralized functions of the State allow no opportunity to use investments for a long period of time. Another radical alternative was the conception of so-called market socialism.

However, at the beginning of the 1990's the most popular idea was that the main obstacle for effective economic development was the State, and the conception of market domination and the minimization of the functions of the State, whose only objective must be to co-ordinate actions in situations where the market does not function. This point of view was implemented in the conception of the economic and political development formulated by the World Bank and International Monetary Fund (IMF). This structural adjustment package meant for transition countries is known as the Washington Consensus. The main idea is the principle that the main task of the government is macro-economic stabilization, including the liberalization of trade and privatization. This consensus was used during the transition from planned to market economy, and was based on ideas on the stabilization of society, liberalization of the markets, privatization of economic structures and restructuring of administration. The course of policy was not set by one authority, but rather as the sum of many.

The main conclusions which should be drawn on the basis of an analysis of the experience of the many countries involved will show that the period of the relaxation of the Washington Consensus is over. The criterion is that the minimization of the role of the State should be changed into the criterion of " how much" State is necessary for the realization of its main functions to develop effective market structures. In the case of Russia it will be clearly impossible to create a market economy without the State.

The negative factor in Russia in the process of transition was the very low level of the ability of the State institutions and structures. Moreover, the ability of the State structures should be formed on new principles. This demands totally new specialists in the sphere of State government. Such specialists should have a modern economic education and understand the new tasks of the State institutions. They should have an opportunity to realize the new progressive ideas in the structures of State government and in State institutions. In practice, the strengthening of the State ability and the restoration of credibility of State structures should begin with the reform of State control with a clear understanding of the tasks which should be accomplished by the social structures. These tasks should be realized only by specialists with a high level of competence who can achieve high profits and who can evaluate the consequences of their decisions. All this demands the creation of the necessary verified data of a definitive and developed vertical structure of State government that takes into consideration the peculiarities of the federalism of the Russian Federation and prescribes distinct functions and tasks for the regional and local levels.