Red Capitalism and Crony Interest Groups–A View from Russia to Việt Nam

Although it is a private corporation, Vingroup routinely responds to negative consumer reactions and civil disputes by bringing in the police. Instead of filing civil lawsuits—standard practice in market economies—certain cases are transformed into matters of “security.”

This results in citizens being summoned, detained, or prosecuted for actions that should concern only the civil rights and obligations between a business and its customers. 

This reliance on the police to silence customers reflects a broader legal culture of “reporting people to the police” in Việt Nam. Consequently, the public has begun to ask whether Vingroup is truly a business or a quasi-institution capable of activating the state’s coercive machinery at will.

To properly assess this situation, one must look at a similar pattern unfolding in Russia. In her book “Putin’s Kleptocracy: Who Owns Russia?”, political scientist Karen Dawisha describes how large corporations become instruments of state power, creating a fused structure she calls “two dragons in one body.” 

The term “kleptocracy”—derived from the Greek kleptēs (“thief”) and kratos (“power”)—refers to governance systems where power is held by those using the state apparatus to enrich themselves and consolidate control.

Though publicly claiming to rule “for the people,” such regimes quietly exploit national resources, abuse the state budget, manipulate policymaking, and convert public assets into private wealth for leaders and their loyal networks.

Journalist Patrick Meney used the term to describe the late-Soviet period and the early years of Boris Yeltsin’s presidency, when the state was systematically hollowed out by networks of cronies.

Kleptocratic systems are typically associated with authoritarianism, concentrated power, a lack of checks and balances, and sometimes even “family rule,” in which state institutions preferentially recruit relatives and loyalists

In her book, Dawisha argues that Russia under Vladimir Putin was intentionally engineered into a “kleptocratic state” where security forces and economic oligarchs form the core of political power. Drawing from archival documents and financial records, she shows that Putin is the center of an intertwined network where:

• Associates from the KGB/St. Petersburg era established slush funds, shell companies, and transnational financial networks,
• Oligarchs were not self-made entrepreneurs but were cultivated to serve a political agenda, and 
• Major corporations functioned not as independent entities, but as extensions of the security state.

This creates what Dawisha calls the “wealth-power feedback loop”: corporations are wealthy because of their power and policy corruption, and they use that wealth to reinforce political control.

One of her most striking arguments—which many Vietnamese readers may find familiar—is the near-total fusion of Russia’s Federal Security Service (FSB) with major corporations, leading to corporate raids, arrests, prosecutions on demand, and the use of criminal law to pressure investors—each example supported with clear, difficult-to-refute evidence.

A kleptocratic state does not need to be designed from scratch; it can emerge naturally under five conditions: privileged corporations, a state without checks on power, overreaching security forces, a vague legal environment, and a society lacking mechanisms for dissent.

When these elements coexist, a state-business alliance emerges organically through mutual benefit: corporations need political protection; the state needs large, loyal corporations to advance political agendas, propaganda, or national projects.

Việt Nam exhibits all five of these conditions. While this does not mean Việt Nam will inevitably replicate Russia, it raises the possibility that corporations like Vingroup could become the nucleus of a new power structure. If left unchecked, such businesses may not only engage in commerce but also participate in social repression. Vingroup’s apparent influence over law enforcement and state media illustrates why many suspect that elements of the police apparatus are already “protecting” loyal corporations.

Thiên Tân wrote this article in Vietnamese and published it in Luật Khoa Magazine on Nov. 18, 2025, as part of the “Reading with Đoan Trang” column, published every Tuesday. Đàm Vĩnh Hằng translated it into English for The Vietnamese Magazine.