Kyiv in crisis: how wild capitalism is exacerbating the devastation
Monday 19 January 2026, by Vitaliy Dudin
The year 2026 began with devastating Russian shelling of Kyiv’s infrastructure, which, in freezing conditions, brought the population to the brink of survival. The city, home to 3 million people, is experiencing an acute shortage of heat and water, and electricity is being supplied on a short-term basis. It has become clear that the authorities had no plan B in case of a catastrophic deterioration in the security and weather situation. However, the Putin gang’s insidious plan would not have been so painful if it weren’t for the vulnerability of the municipal infrastructure caused by Kyiv’s leaders. Mayor Vitali Klitschko has already called on all those who can to leave Kyiv. This leads to the conclusion that the authorities are unable to solve the problems of a city that is far from the front line.
Such statements place the responsibility for salvation on the people and do nothing but increase panic. In contrast, the response should be to introduce measures that increase social support and, as a result, strengthen solidarity. Giving people the feeling that they are in control of the situation and can make a difference is what would strengthen their belief in Ukraine’s victory.
Criticism of the situation focuses on the personalities of Kyiv’s leaders, but ignores the broader political context. The government’s inability to solve the pressing problems of the population stems from the fact that it is focused on serving the business elite. Therefore, it is extremely important to discuss the essence of the changes that will allow for the integration of urban services, the humanization of the work of municipal workers, and the maximization of benefits for the community.
Under the rule of business
It would be naive to deny the connection between the critical situation and the spontaneously capitalist course of the Kyiv authorities. For years, pieces of municipal property have been handed over to private owners, and there has been no development planning at the city level. Where the authorities proved to be systematic was in selling land to developers and protecting the interests of corporations. The capital had the flaws described by researcher David Harvey in his critique of modern cities: private capital focuses on selective development, while everything around it deteriorates. Developers overload urban communications, ignoring the destructive consequences of chaotic urban development. And then all Kyiv residents pay for it with their comfort due to the deterioration of utilities (heating temperature, water pressure, frequent accidents, etc.). The urban model, based on commerce and corruption, has never been sustainable and is now experiencing its deepest crisis in history. According to Forbes, before the invasion, Kyiv was the best city for business development, although the level of satisfaction with its development was critically low (38%).
During the war, a situation arose where emergency services were able to quickly overcome the consequences of shelling and save people, but people had to rely on their own resources to solve the related social challenges. We have a paradox: a city with a budget of UAH 100 billion cannot afford temporary social housing for resettlement, and utilities are provided intermittently.
A separate issue is the deplorable working conditions of critical infrastructure workers, on whose daily heroism many lives depend. For years, the authorities have been unable to set wages at a level commensurate with the existing risks, and only now have they started talking about bonuses for those involved in emergency work (we are talking about allocating 50 million hryvnias). Without effective worker control, such measures may be selective and sporadic. It is known that in 2023, the trade union of Kyivteploenergo had to go to court to force the employer to increase staff salaries.
Dissatisfaction with the state of wages even resulted in a petition demanding additional pay for operational personnel who perform their duties during air raid alerts. We should not forget about the situation with non-payment of compensation for injuries caused by Russian shelling, which is a measure of the authorities’ attitude towards such workers.
The problem is fuelled by mistrust due to the lack of real information about the state of housing and communal services: the accountability of both municipal and private enterprises is highly questionable, and the headquarters that are being set up bring together a limited circle of officials.
Who owns all the utilities?
There is no coordinated system for managing Kyiv and responding to challenges, which reflects the situation with control over property. The ownership structure in the capital’s housing and utilities sector is complex, with elements of communal and private (oligarchic) forms of ownership intertwined.
The largest companies in this sector are as follows:
Kyivteploenergo (100% municipal ownership);
DTEK Kyiv Electric Grids (100% private ownership);
Kyivgaz JSC (60% owned by Kyivenergo Holding PJSC);
Kyivvodokanal PJSC (67% owned by Kyivenergo Holding PJSC).
Given the pre-collapse state of the housing and utilities sector, the profitability of these companies is surprising. At the same time, Kyivenergo Holding, which has shares in a number of leading enterprises, is municipally and offshore owned, with a majority stake held by the city authorities (61%), which, as is well known, consist of friends of big business.
It is too early to say that Kyivteploenergo is a model of responsible management, as the company has shown itself to be extremely ruthless towards consumers of utility services. Through the efforts of its lawyers, this municipal enterprise has filed up to 26,000 lawsuits to collect debts; some of the claims in current cases date back 10 years. Pensioners, whose accounts are blocked during martial law, are forced to make their ‘contribution’ to the company’s profitability. The company itself does not hesitate to use martial law as a cover to ignore requests regarding its finances. The logic of ‘corporations are more valuable than people’ in action!
Disintegration and irresponsibility
Kyiv’s master plan for 2000, planned in the past.
Urban economy is a single complex system that covers all areas of the city’s life support (engineering networks, transport, amenities, social infrastructure) as interrelated elements that work for the functioning and welfare of the urban community. The fragmentation of this sphere by various entities leads to a lack of responsibility for its maintenance. It is nonsensical for these companies to be privately owned or to exploit the population for profit. Maintaining this chaos in times of war is a crime against the welfare of the community.
Freeing the housing and communal services sector from private influence and narrow market logic will help to align the interests of the community and consumers. And vulgar clichés about everything budgetary automatically becoming corrupt should be resolutely rejected. Firstly, in the absence of effective anti-corruption control over private companies, we do not know the extent of waste and abuse by their managers. Secondly, we cannot even imagine how effective municipal property with open accounting and under worker control can be in meeting needs. Thirdly, the net profit of 5 billion in Kyiv from the activities of municipal enterprises in 2024 refutes the thesis about the chronic unprofitability of this sector (another question is at what social cost this profitability is achieved). Fourthly, it is virtually impossible to ensure competition in the municipal sector, which means that private companies will act as monopolies.
The situation requires a change in approach to ownership of property used by all city residents. In order to provide the population with affordable goods and services, as well as to increase the city’s revenues, the possibility of municipalizing other public facilities, including catering establishments, should be considered. Only on this basis can the amount of available resources be determined and the priorities for production and distribution of goods be set correctly. This could curb the growth of inequality, as we are approaching a point where hundreds of thousands of people will not be able to cook for themselves at home, while shopping centres and restaurants will operate for their own benefit.
It is not too late to municipalize
So, the current crisis in the capital is a crisis of governance, caused by the disintegration of the economy and misguided anti-social priorities. However, at the same time, it may lead to an awareness of the need for radical changes, as a result of which the community will feel like a full-fledged owner. If we want to transform municipal companies from someone’s feeding trough into a means of salvation, we will have to take responsibility, resisting the myths about the magic of the free market and the omnipotence of corrupt bosses.
1. Socialisation of infrastructure as the basis for transparency. During wartime, nothing can be private or exist on its own — the entire system must work towards a single goal and for the good of the country. Monopolies must serve the community.
2. Effective worker control. Creation of rescue headquarters with the mandatory involvement of critical infrastructure workers. This body should have complete information about the state of the energy system and make decisions on the shutdown of enterprises that are not critical to the economy due to force majeure.
3. Cancellation of utility debts. Citizens should not suffer from accumulating utility debts when services are provided intermittently. It is unacceptable for utility companies to operate profitably by collecting funds from pensioners and people with disabilities.
4. Fairness for critical infrastructure workers. During the hardest years of the war, the heroes of the infrastructure worked almost for free, putting themselves at risk. The state must fulfil its debt to them and listen to the demands of the trade unions.
5. Support for the suffering population of the city. Instead of calling on people to leave, there should be benefits for those who stay. Heating in budgetary institutions and meals in catering establishments, compensation for the cost of installing solar panels at home. For remote workers, communal centres should be properly functioning so that they can work regardless of disruptions.
In addition, these measures should be combined with steps in the field of employment, such as counting the time spent in the city during blackouts towards insurance experience, voluntary involvement in socially useful work with decent pay, and the provision of paid leave for volunteering in the interests of the city.
If the logic of governance is not reoriented towards support, cities will face depopulation, inequality and stagnation.
Selfishness and the market have run their course; it is time to think municipally and collectively!
16 January 2026
Translated by International Viewpoint from Соціальний рух.
Attached documentskyiv-in-crisis-how-wild-capitalism-is-exacerbating-the_a9372.pdf (PDF - 1 MiB)
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Vitaliy Dudin is a member of Sotsialniy Rukh, Ukraine.
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