#1 - JRL 7172
Russia: In Politics, What's Old Is New -- Cabinet Squabbles As Putin Floats Above The Fray
By Gregory Feifer

Speculation is a hallmark of politics in Russia, where little is known about the inner workings of President Vladimir Putin's government. The country's reforms are often attributed to the popular leader, but to what extent does Putin actually influence policy? Observers say a recent spat among top ministers shows the president, rather than making his own decisions, uses infighting as a means of maintaining control.

Moscow, 7 May 2003 (RFE/RL) -- Russian President Vladimir Putin is often portrayed as an all-powerful leader guiding most aspects of government policy. But how true is that image?

Political analysts casting around for the source of Russian policy decisions often look past the president's own views to those of the groups vying for power within his administration.

Most cabinet decisions are made quietly behind closed doors. But sometimes disagreements between ministers and other top officials spill over into public view -- and the results are carefully examined to help gauge the balance of power within the presidential administration.

That was precisely the case when Prime Minister Mikhail Kasyanov and Finance Minister Aleksei Kudrin recently traded public accusations about the course of tax policy.

The argument became apparent in March, when a simmering dispute over economic reform bubbled over. The heavy-set, baritone-voiced Kasyanov accused the bespectacled Kudrin of dragging his feet on tax reform, saying proposed cuts -- including a 2 percent decrease in the value added tax (VAT) to 18 percent -- were too small.

The agitated prime minister abruptly cut short a cabinet meeting before Kudrin's deputy was scheduled to present a Finance Ministry report on the matter. Kudrin in turn accused Kasyanov's staff of rewriting documents that had already been approved by the cabinet. The argument died down -- in public, at least -- last month, when Kasyanov in the end approved Kudrin's proposals.

The respected "Kommersant-vlast" magazine wrote at the time that the taxation scandal shows that "Putin's management system is breaking down more and more often. The president, to whom the constitution gives unlimited power, is deliberately not making final decisions." Another newspaper wrote this month that the government is coming apart at the seams.

Many observers agree the current Russian government is following a traditional pattern of keeping the head of state above the political and geographical fault lines that fragment the rest of the administration. Vladimir Pribylovskii is head of the Panorama think tank. Writing this month in the "Smysl" journal, he identified four main groups of political oligarchs in Russia, dubbed "clans."

One is the "Family," the remnants of the coterie surrounding former President Boris Yeltsin, of which Kasyanov is a leading member.

A second "St. Petersburg" group comprises chiefly liberal economic reformers from the country's second city, which is also Putin's home town. The group includes Kudrin, Economic Development and Trade Minister German Gref -- another to face Kasyanov's wrath in recent months -- and the powerful power-utility boss Anatolii Chubais.

A third group, also largely from St. Petersburg, consists of current and former security services agents surrounding the president, who is himself a former KGB spy.

A fourth group is led by powerful Moscow Mayor Yurii Luzhkov.

Pribylovskii told RFE/RL that the positions of each clan are not always mutually exclusive and that each member acts according to his own views and role to various degrees. While Kudrin, Gref, and others are interested in defending certain principles, Chubais and Kasyanov are chiefly motivated by maintaining their influence.

"Kasyanov's position about lowering taxes is in fact demagogic. It's no accident that he kept defending his position, attacked Kudrin, and then suddenly agreed to all Kudrin's proposals." Pribylovskii said.

As a result, he added, Kudrin comes out on top in the tax standoff but will be held responsible if the tax cut is later deemed either unnecessary or too small -- meaning a strategic victory for Kasyanov.

Pribylovskii said the Kasyanov-Kudrin confrontation also reflected a clash between the "Family" clan and the "St. Petersburg" security-services group.

Kasyanov has recently also locked horns with the Prosecutor-General's Office -- seen as the domain of the security services -- after being declared wanted for questioning over a scandal involving the distribution of fishing quotas.

Dmitrii Orlov is deputy director of the Center for Political Technologies. He agreed that the Kudrin-Kasyanov standoff is both a matter of clashing principles as well as an "inevitable" confrontation between clans. "Kudrin represents the 'macroeconomic' bloc and has ties of his own to Putin, whereas Kasyanov is a leader of the group traditionally called the 'Family.' That's why their collision is unavoidable. It's strange that it took place so long after the government began its work," Orlov said.

Putin, meanwhile, allowed the argument to take place but remained silent on the issue. Writing last month in "The Moscow Times," investigative journalist Yulia Latynina said lying low is part of the president's means of exercising power.

She asked, "Is it conceivable that Kasyanov would publicly and harshly criticize two cabinet members -- both of them part of the St. Petersburg clan to boot -- entirely on his own initiative?"

While neither Kudrin nor Gref has suffered formal consequences, Latynina writes, Kasyanov's public rants against them are reminiscent of the Soviet era, when "everyone spied on everyone else" and the head of state appears to maintain control by acting as a seemingly detached mediator.

Pribylovskii agreed, but added that Putin has so much power he doesn't "have to rely on intrigues -- although maybe it's easier for him to do it that way."

Pribylovskii said Kasyanov's spat with Kudrin -- a possible future candidate for the premiership -- did not reflect personal antagonism. To protect his position as prime minister, Kasyanov must fend off regular attacks, and will likely lock horns with other officials again later this year. "I think such conflicts will surface again, but the ideas themselves will not be the most important aspect," he said. "The most important thing is the battle between groups, and the ideas used [in the fight] can be completely different."

But if Putin allows government officials to squabble about economic policy, he retains the ultimate decisions over personnel policy. Pribylovskii said it is not clear how much longer the president will allow "Family" clan member Kasyanov to remain prime minister.

Orlov of the Center for Political Technologies agreed that the political futures of Kasyanov and other top officials remain firmly in the hands of the president. "Sooner or later, he'll have to make a choice because public opinion demands that Putin needs to be emancipated and needs to rid himself of people tied to the figure of Yeltsin."

Orlov said Putin will likely sack Kasyanov after presidential elections next March.