Armenia’s Oligarchy’s Corrupting Influence on the Diaspora

 Dr. Berge A. Minassian, Armenian Renaissance, Toronto, 16 September 2015

In my last essay (‘Debate and Decision’, Keghart, August 9, 2015), I asked whether there is any good reason to select oligarchy as our system of governance of Armenia.  The only valid reason I had heard was that Russia itself is oligarchic, and would not countenance a democratic Armenia in its fold.  I went on to make the case that while this may be a valid argument it is wrong.  The comments in response to my article agreed on this point.  The bottom line is that it is time to decide to reject the system we have and move into the modern world.

A much more expert economist than me, Prof. Daron Acemoglu, uses the more precise terms of ‘extractive’ for ‘oligarchic’ and ‘inclusive’ for ‘democratic’.  Another term he expounds on in fantastic detail in his ground-breaking book “Why Nations Fail” is ‘creative destruction’.  The latter describes one of the processes through which stagnant countries with extractive rule, break out into modernity and success with some new invention or approach that destroys the hold by the old oligarchy on the economic levers of the country. 

 Dr. Berge A. Minassian, Armenian Renaissance, Toronto, 16 September 2015

In my last essay (‘Debate and Decision’, Keghart, August 9, 2015), I asked whether there is any good reason to select oligarchy as our system of governance of Armenia.  The only valid reason I had heard was that Russia itself is oligarchic, and would not countenance a democratic Armenia in its fold.  I went on to make the case that while this may be a valid argument it is wrong.  The comments in response to my article agreed on this point.  The bottom line is that it is time to decide to reject the system we have and move into the modern world.

A much more expert economist than me, Prof. Daron Acemoglu, uses the more precise terms of ‘extractive’ for ‘oligarchic’ and ‘inclusive’ for ‘democratic’.  Another term he expounds on in fantastic detail in his ground-breaking book “Why Nations Fail” is ‘creative destruction’.  The latter describes one of the processes through which stagnant countries with extractive rule, break out into modernity and success with some new invention or approach that destroys the hold by the old oligarchy on the economic levers of the country. 

A classic example of an aborted attempt at creative destruction that Acemoglu recounts is presentation by a modest Englishman to Queen Elizabeth I, of a machine that would automate weaving.  Despite her many otherwise enlightened decisions (her reign established England’s Renaissance), in this case she refused to give the inventor a patent, because such a machine would be too revolutionary and would destroy the English nobility’s hold on power.  Here I explore whether the leadership of the Armenian Diaspora is ‘inclusive’ and whether processes such as ‘creative destruction’ are possible in the Diaspora.

If not impossible, it is extremely difficult to imagine a democratization of the Diaspora because of the ever-presence of the ‘opt-out’ option.  Unlike a Diaspora a country can be likened to a group of friends in a sailing boat in the middle of the sea.  One way or another they have to agree on which way to direct the boat.  They have to go together and do not have the option of each going his own way.  If they decide to do it democratically, the majority’s direction will be adopted, for better or worse, but at least the boat will move.  In the Diaspora, each person or group has historically gone its own way, because they can.  It is unlikely that this behavior will change, because the opt-out option will always be there.  The space of this essay does not allow a full elaboration of the many other reasons why a democratic Diaspora is extremely difficult to achieve, not the least of which is the definition of who is Armenian.  Let us take today’s Diaspora in Canada as a snapshot of the history of the Diaspora.  Who are the leaders of the Diaspora?

1) The Church.  It derives its power from God and is certainly not ‘inclusive’, i.e. its decisions are not based on a majority of the people’s will.  The church is a classic example of how ‘creative destruction’ fails in a non-democratic structure.  In the two arms of the Armenian Apostolic Church there is not a single disagreement on doctrine or dogma, yet the church is unable to unify, even though this is the wish of the great majority of Armenians.  Unification would be ‘creative destruction’ of the powers of the clerical leaders (the ruling catholicoi and bishops) who would have to relinquish power.  They thus resist, and because they have the opt-out option, remain divided.  The situation is compounded by the direct participation of the leadership of the Armenia based church in the extractive oligarchy ruling Armenia.  That oligarchy, like all nobility, fights to perpetuate itself.  With the church leadership in its fold, the oligarchy directs the church to behave in such a way as to confer to it ‘divine’ support.  Like all nobility, the oligarchy abhors creative destruction, including reunification of the mother church of the Armenians.  Incidentally, the Catholicos of the Holy See of Cilicia recently called Mr. Gagik Tsarukyan, the Armenian oligarch par excellence the ‘sun’, because the latter donated $ 500,000 to the See and to the Armenian Revolutionary Federation (ARF).  How can the catholicos not know where this money comes from, and how can he in future call the ‘sun’ a lost sheep?

2) The Armenian General Benevolent Union (AGBU).  The organization is not inclusive in its decision-making.  Usually, one has to belong to the financial elite to join its leadership.  Being non-inclusive, AGBU chapters derive, ostensibly, legitimacy from the oligarchy in Armenia, including the church.  They revel in medals from the extractive regime, and thus have their official mouths sealed from criticizing the regime.  This does not mean that the AGBU, or any of the four groups in this list, does not do good.  I am simply pointing out the non-democratic nature of the leadership of the Diaspora and the resultant unholy and unhealthy alliances that organically rise in non-inclusive structures.

3) The All-Armenian Fund. The head of this organization is the president of the country and the head of the ruling oligarchy. The other board members include church leaders (non-inclusive), AGBU (non-inclusive), political parties (non-inclusive) and famous personalities.  There need not be any further discussion of inclusiveness in this arm of the leadership of the Diaspora, since it is in fact headed by the non-inclusive extractive regime ruling the country itself.

4) The ARF – While the ARF has internal democratic modes of election, it also has democracy-quashing powers in its echelons all the way to the top.  Local leaders can evict from the party anyone they wish.  As a result, the Toronto ARF, for example, has been led by the same family, relatives and friends for decades.  Likewise, the ARF bureau voids any local election or decisions it does not like.  As such, the bureau, based in Yerevan, has absolute power on the ARF in the Diaspora.  The bureau is near-totally in line with the ruling regime in Armenia on all important issues, except the erstwhile protocols signed with Turkey.  The ARF was a regime partner until recently, and when they left that coalition still accepted important ambassadorial posts, and today are the chief supporters of the constitutional changes devised by the regime to perpetuate its rule.  The ARF, which has a massive influence in the Diaspora, is generally silent on the misrule in Armenia.  It stood by the regime during the March 1, 2008 massacre and obtained a number of ministerial rewards, and more recently openly called for imprisonment of civic activists. Finally, major ARF figures in Armenia are part and parcel of the oligarchy.  Space does not allow further elaboration, but any serious retrospective of the last decade clearly shows that the ARF essentially toes the regime line.

Returning to the main topic of Diasporan governance, a very recent case highlights the damaging consequences of non-inclusionary, non-accountable leadership.  One of the authors of policy and platform initiatives for the Liberal party of Canada, Mr. Viken Attarian, presented himself for investiture in his riding, the first step towards participating in the present federal elections.  Mr. Attarian is well known in the community as one of its greatest thinkers, and a person of unimpeachable integrity and abilities. The ARF worked tirelessly to ensure the defeat of Attarian.  The story is long (‘Montreal Armenian Disunity the Big Winner’, August 23, 2015) but the downstream effects were also the loss of two other Armenians’ strong chances of occupying seats potentially in the governing party of Canada.  While one cannot know directly why the ARF was so worried about Attarian in parliament, four facts are clear.  He would have been a leader of the trio of Armenian parliamentarians.  He had in the past criticized the ARF for actions he did not consider right (as he had other parties).  He would most certainly have worked to do what could be done from Canada to bend rule in Armenia towards inclusive governance.  Finally, he would have quite possibly reached the highest places of power in Canadian government, including even foreign ministerial position.  The ARF’s relentless attack to prevent a uniquely qualified Armenian from reaching Canadian government position is another typical example of the age-old dread that non-inclusive leaderships have of creative destruction.

I wish those who would like to democratize the Diaspora well, of course, but I consider that task of Sisyphean difficulty, in particular because of the inextricability of the opt-out option from the nature of Diaspora.  On the other hand, it is eminently possible to transform the governance of Armenia.  Acemoglu’s sweeping historical review in ‘Why Nations Fail’ shows example after example of how this happened elsewhere and how countries move from stagnation and failure to success and thriving, or vice versa.  I suggest that saving the motherland is priority, is doable, and will be supremely consequential on the future of the Diaspora.  Imagine a day when the hands from Armenia meddling in the Diaspora are not wily ones of those wishing -at all cost- to preserve and expand personal power and wealth, but the honest, firm and gentle hands of the genuine Armenian people shaping the only future there is for the Armenian nation.  
     

10 comments
  1. Disunity in the Armenian Church

    Dear Dr. Minassian,

    Your assessment of Armenian disunity is fair and balanced. I would like to also add a few comments as well.

    The hierarchs of the Cilician See bow to the directives of the ARF just as the the hierarchs of the Echmiadzin See follow the directives of the Armenian Government. As long as this situation continues, there will be no real unity, only one that is superficial. This is no secret to anyone.

    Several years ago a woman delegate from Connecticut stated at a Diocesan Assembly the following: "None of you people know what you are talking about. I am a business lady. This lack of unity boils down to two things: wealth and power."

    While this is a paraphrase of what was said, I think we all get the message, and if we are honest, we will not deny this truth.  Neither of the two hierarchical sees of the Armenian Church, the ARF, or the Armenian Government are willing or ready to relinquish their control of wealth and power for the sake of real unity as you have so well stated. 

    Let us hope and pray that enlightened individuals will emerge to positions of leadership in the church, government, political parties and philanthropic organizations who will place the interests of the church and nation above their own agendas.

    Respectfully yours,
    Garabed

    1. Of Wealth and Power

      Some twenty-five years later there are no Diaspora businessmen I know of whose businesses have thrived in Armenia or they had been allowed  to flourish in Armenia. The late Vahakn Hovnanian bitterly complained of the suffocating state the monopolies are having for on business, so did Charles Aznavour. That’s how much for a Diaspora Armenian aspiring for wealth by association with those who are in Armenia.

      As to power, let us look what happened to the best and the brightest that Diaspora offered to Armenia be it,  Raffi Hovannissian, Vartan Oskanian as foreign ministers, Charles Aznavour as a benevolent businessman, Jirair Libaridian as an advisor. Their wings have long been clamped to have any much say, let alone any power to bring about change.

      If it’s not by offering wealth and power, how do the oligarchs have a corrupting influence on Diaspora?

      Armenia’s oligarch corrupts Diaspora by catering to the sentiments of the Diaspora Armenians. The latter heed to their gestures of perceived appreciation not out vanity but out of good will for having been recognized for their contribution towards Armenia that invariably will help cement the prevailing system  further if change does not come about.

      It would be tragic if the friends of Armenia keep silent.

      1. “ ….the best and the brightest …”

        “ ….the best and the brightest that Diaspora offered to Armenia be it,  Raffi Hovannissian,…”

        Raffi Hovannisian is one of the alleged “best and brightest”?
        You are not joking, right?

        The man is a  fraud.
        God help us if he were one of the  “best and brightest”.
        (he is not).

        Last thing Armenia needs is a "gift" like him from the Diaspora. 

  2. Dear Dr. Minassian, Thank you

    Dear Dr. Minassian,

    Thank you very much for touching on this sensitive subject in a professional way, without any negative comment, but rather using professional language to “diagnose” and prescribe the right “medication” to fix our national problem. In fact, this is not national, this is an internationally known problem throughout Human history as Acemoglu points out in his book. Thus, using his terminology (which is becoming more and more generic in economy and politics) I would like to briefly comment on the same issue in our motherland.

    Armenia has no way to prosperity since we have a monopolized (extractive) economic institution, an almost monopolized political institution (new constitution change is an attempt to validate it on a constitutional level), and a monopolized religious institution (legalized by constitution). If we stop here, all of these extractive (non-inclusive) institutions, because of their monopolized nature, are already sufficient to largely fail in providing basic public services including justice, law enforcement, and education.

  3. Diaspora’s Corrupting Influence On Armenia

    I would have tilted the article "Diaspora’s Corrupting Influence on Armenia’s Oligarchs".

    Let us face, Armenia’s oligarchs cannot corrupt the Diaspora. How could they? Diaspora’s wealth is not concentrated in the hands of a few Diaspora oligarchs. Diaspora cannot harbor in its midst oligarchs who would have much of an influence on the nation on par with the oligarchs of Armenia who run the country and reside in palatial residences adorned with statues which appear to be eye sores.

    Surely the wealthy in Diaspora have more influence in the community affairs but historically they have done and continue to do much good for the benefit of upholding our vital Diaspora institutions be it schools, churches and community centers.

    The oligarchs in Armenia, on the other hand, are the beneficiaries of our sentimental ties to Armenia. There are no strings attached to the financial contributions Diaspora makes to Armenia. As tourists we stay at the hotels owned by the oligarchs, shop in fancy stores owned by the oligarchs, dine in restaurants owned by the oligarchs. Yerevan is owned by oligarchs lock, stock and barrel. A mere 25 years ago the people of Armenia owned not only Yerevan but the entire real estate that is Armenia. The overwhelming majority of them have now become the disfranchised poor whom we extend help instead of attempting to correct the monopolies that makes them poor.

    1. Garabed, I couldn’t have said it any better

      Garabed,

      I couldn't have said it any better. Your comparison of the wealthy Armenians in the Diaspora and the Oligarchs in Armenia is right on the spot. Keep on writing on this theme. It seems you know a thing or two compared to some other individuals, specially the ones trying to praise the virtues of the oligarchs in Armenia. To what end? Their postings resemble the cacophony of broken records.

      Thank you.

  4. Agreement

    This article is right on the money. This talented race of people seemed destined to extinction due to the pride, greed and arrogance of  their "leaders". How disheartening.

  5. Armenians of Diaspora

    Everything that has been written is accurate. Do you know why? Because Armenians of the Diaspora take with them the rude manners of the Turks. This must change. We must be Armenians. How? By being more original.

  6. Wondering

    Dear Avery,

    I am impressed by your concern for our homeland, your knowledge of Armenia, and your ability to communicate effectively. However, I am surprised that an intelligent and well-read patriot like you denies the undeniable… that Sargsyan and his oligarchs have seriously damaged Armenia through their corrupt and lawless ways.

    It's also disappointing that you sometimes indulge in name calling (people who disagree with you are "armchair" commentators). Thrice I have been to our homeland–all in the past five years. I can't enumerate the number of people I have spoken to during my visits, but I can tell you that not a single person I have talked to would say Sargsyan and his friends have been good for Armenia. They include a couple of professors, writers, journalists, artists, shop owners, young women in the park, university students, taxi drivers, relatives.

    Statistics which agree with one's point of view are dime a dozen. Pundits might be biased. Journalists might be working for a publication owned by interest groups. There's nothing like honest, face-to-face chats with locals to conclude that Armenia is in bad shape and Sargsyan and his people are to blame for most of Armenia's ills.

    Avery, you damage your credibility by beating the drums for a lawless, violent, and corrupt subculture. Please reconsider.

  7. Small Example

    I can give you a small example from Kuwait.

    Gagik Dzarukyan (nicknamed Dodi Gago) visited Kuwait and promised its "community" (church and some people who appoint themselves as community leaders) money to build a new church. This year his mother visits the same "community" to cut the ribbon during the opening ceremony of khachkar inside the premises of the church and "arachnortaran". 

    The "community" is running an Armenian school with sub-standard educational level and amateurish management. It has many poor families or families who can't return to Syria due to the war there. They have lost their properties. 

    Can we ask Dzarukyan to help the school (not the building but the system/curriculum/qualified teachers) or the "community" members? 

    Dzarukyan has promised money also to Catholicos Aram of Antelias. Why would he do that? Doesn't Armenia need that money more than Antelias?  

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