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Asia Times
May 16, 2003
Putin's sad anniversary
By Pavel Ivanov

May 7 was an anniversary for the current Kremlin inhabitants - three years ago Vladimir Putin was officially inaugurated as the second president of the Russian Federation. It should have been an occasion for stepping back and analyzing the results of these three years.

However, instead of that, as well-informed sources in Moscow report, Putin, who had just returned to Moscow after a short recreational break and "informal" talks with his Ukrainian colleague Leonid Kuchma in the Crimea, had to face quite an unpleasant surprise - a rebellion inside his own Kremlin team.

The most embarrassing thing about it all for the president was the fact that the "rebels" turned out to be his most trustworthy comrades-in-arms in his previous service in the directorate of the KGB for Leningrad and the Leningrad Region, and old buddies in the administration of St Petersburg.

The "Chekists", represented by two deputies of the chief of the presidential administration - Victor Ivanov and Igor Sechin, supported by Minister of Economy and Development German Greff - threatened the president to simultaneously resign if he did not change his "political line to collaborate with the oligarchic gang which is trying to privatize the state authorities".

The exact reaction of Putin to such a demarche by his closest associates is yet to be known; in any case, no resignations have as yet occurred. But our sources claim that the president "was deeply shocked and saddened", interpreting the "rebellion" as the first sign that the electoral campaign in Russia - parliamentary elections are scheduled for December, presidential elections for early next year - has already begun.

So what was the reason Putin's anniversary was marred by his closest comrades? Apparently, his entourage started getting increasingly worried by the activities of the Boris Yeltsin "Family" part of the administration - particularly, its head Alexander Voloshin and his deputy, Vladislav Surkov. Out of the blue, both recently launched an energetic lobbying campaign with the president in support of the so-called "project of the parliamentary majority".

It is not a big secret in Moscow's political circles that this project, which involves several constitutional amendments leading to the establishment of "government by the Duma [Russian parliament] majority", was written with the active participation of Mikhail Khodorkovsky - head of the Russian oil major Yukos and the richest Russian oligarch.

Let me explain: Under the current Russian constitution, tailored exclusively for Boris Yeltsin, only the president has the right to nominate the head of the government, and the Duma is merely to put its stamp of approval on this nomination. However, quite powerful forces in the Russian top business elite led by Khodorkovsky and supported by the Yeltsin old guard within the presidential administration (Voloshin, Surkov), are now pressing the president to initiate a crucial constitutional amendment which, in essence, would allow the party or a coalition of parties winning the parliamentary elections to form the government and nominate the prime minister (with the approval of the president).

Khodorkovsky, who has made clear his plans to run for president in 2008, apparently has decided not to wait that long. By far being the major financial donor to different parties running in the Duma campaign, he expects that - in case the constitutional amendments are approved - he will easily be able to control the future government, and possibly replace the current Prime Minister Mikhail Kasyanov.

In this manner, Russia could get a French-style political setup. The president would remain in overall charge, but his powers would certainly be restricted by the parliamentary majority. Putin, of course, realizes that. However, he also knows that without support of oligarchic capital, it will be quite difficult for him to maintain "political stability" in the country, or even get re-elected himself.

And this is what has the old KGB guard in the Kremlin up in arms. They are concerned that after several attempts to somehow restrict the oligarchs' political appetite, Putin has started giving up his positions one after another. The latest examples: presidential blessings for the merger of Yukos and Sibneft, which brought two most politically active oligarchs - Khodorkovsky and Roman Abramovich, the controlling shareholder of Sibneft - together, and approval of construction of the first Russian private oil pipeline - again, given to the same Khodorkovsky. From the KGB grouping's point of view, Putin is "betraying" the ideals of Russian statehood supremacy over private business interests, and hence the mutiny on the presidential ship.

Being quite busy fighting for the ideological purity of the president, his closest collaborators did not bother to take a closer look at the real results of Putin's third anniversary as president. They should have, because those results are far from glamorous - and that's what's inviting the oligarchs' political power moves.

The Kremlin KGB clique boasts that Putin "prevented Russia's disintegration" and "localized" the war in Chechnya. However, Russian 18-year-old boys dressed in army uniforms have still been killed in Chechnya every single day during these three years. The widely advertised fact that Putin rejected Yeltsin's policy of borrowing from international financial institutions is equally problematical. Russia's international debt of US$160 billion has decreased by just $10 billion, and simultaneously internal debt has grown dramatically.

Solemnly-pronounced reforms of the judicial and banking systems and the natural gas market remain at the same stage where they were three years ago. His KGB buddies claim that Putin returned Russia to the club of the leading world powers, confirming its status as a great world power. But in reality, Russia now finds itself in the quite dubious position of chairman of the world's club of losers. It is a sad anniversary. If Putin now makes a deal with the oligarchs in order to stay in power, he may end up no different than Yeltsin in the final historical judgment on his "idealistic" rule.

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