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Moscow Times
July 23, 2003
The President's Friends and Their Appetites
By Yulia Latynina

It's not all that surprising that the oligarchs have been experiencing some unpleasantness of late. What's surprising is that, judging by their reaction, this has come as a bolt from the blue. In fact, the writing has been on the wall for some time.

The unpleasantness started with Vladimir Gusinsky, whose biggest crime was losing a political battle. His media empire was divided among the victors -- common practice in all non-democratic countries. Then came Boris Berezovsky. He engineered election victories for Unity and President Vladimir Putin, then rubbed their noses in it. Berezovsky's empire was shared out among his partners who had the good sense to stay out of politics.

Next up: Yakov Goldovsky, president of the huge petrochemical company Sibur, which was built with Gazprom money. Gazprom wanted to take back Sibur's assets, but Goldovsky was too smart for them. The siloviki -- bigwigs in law enforcement and the security services -- had little choice but to throw Goldovsky in prison and then ask him: "If you're so clever, why don't you tell us how to take back Sibur's assets."

Finally, who could forget vodka tycoon Yury Shefler, owner of the Stolichnaya and Moskovskaya brands. The state banned Shefler's company, S.P.I. Group, from producing the brands domestically and handed the trademarks to a state-owned company, Soyuzplodoimport. The state's interests in the case were represented by new Soyuzplodoimport chief Vladimir Loginov, the same Loginov who formerly headed Russky Sakhar. You may recall that at one point Russky Sakhar failed to repay some $100 million to the state. One of the partners in Russky Sakhar was murdered, and a second survived an assassination attempt. Loginov gave the murdered partner's dacha to former Justice Minister Valentin Kovalyov. Yes, the same Kovalyov Loginov had admitted bribing during the former minister's embezzlement trial.

Several threads connect all four cases. The first is judicial incompetence. Second is the catastrophic consequences for the economy. It's hard to say exactly where Sibur's assets ended up, but the company has practically ceased to exist as an entity.

And third, you can't but wonder how these defenders of state interests were selected. They seem to have been recruited by the same criteria used to recruit informers -- the main one being that there is plenty of kompromat on them.

But the boundless appetite of the siloviki is just one side of this story. The other side is their total immunity. The president will not fire his friends, period. You have the country and then you have the president's friends. His friends are just average people, but as Lord Acton said: "Power tends to corrupt, and absolute power corrupts absolutely." These are people who control the armed forces, law enforcement and the security services, and who need not account for their actions because of their proximity to the president.

Who will win the ongoing battle between the oligarchs and the siloviki? Why even ask? It would be naive at best to assume that after getting away with the Dubrovka hostage crisis and Iraq, the siloviki will face the music over some oil company called Yukos. Putin is loyal to his friends. That's why he was chosen to succeed Boris Yeltsin in the first place. Those that picked him simply didn't figure that this obscure KGB colonel had any friends besides Anatoly Sobchak.

Will the campaign against the oligarchs expand even further? It's a senseless question. Even if they don't officially get the green light, the prosecutors, driven by their thirst for other people's property, will continue their onslaught.

How will it all end? The pilot has surrendered control of the aircraft to people who have never in their lives handled anything more complicated than a scooter. But they're his friends, and it wouldn't be right to kick them out of the cockpit the first time they put the plane into a nose dive.

How do you think it will end?

Yulia Latynina is a columnist for Novaya Gazeta.

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