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Moscow Times
August 2, 2004
The Kremlin Shows Its True Face
By Yevgenia Albats

I have never been so concerned about the future of this country as I am today. I don't expect the government to start rounding up dissidents, a practice stopped by Mikhail Gorbachev in the mid-1980s. And I don't think they'll reactivate the gulag. There is no compelling economic or political justification for a return to a system that proved so incredibly inefficient, especially since Russia no longer has a need for slave labor.

Instead, I fear that the regime will adopt the practice, popular in some Latin American autocracies, of simply killing people on the streets or making them disappear. This sort of thing occurred in Ukraine not so long ago, and it continues in Belarus today. It may have even begun in Russia: The St. Petersburg journalist Maxim Maximov vanished a month ago.

My pessimism is a reaction to the Kremlin's ruthless actions over the past month. During President Vladimir Putin's first term, the Kremlin at least came up with cover stories to account for its policies, such as the need to strengthen the state and regain control by putting the fear of God into the oligarchs. Or the goal of increasing economic growth by attracting foreign and domestic investment. Or the desire to restore a measure of the social justice eroded during the Boris Yeltsin years. Skillfully peddled by the Kremlin's spin doctors, these cover stories were readily consumed both at home and abroad.

But in the last month the Kremlin has shown its true face. The highly publicized Yukos case is just the most glaring example. Few still believe that the reason for the government's assault on Yukos was that Mikhail Khodorkovsky planned to sell the oil major to an American company, or that Khodorkovsky wound up in jail for breaking an unwritten agreement not to venture into politics. Such factors might explain why Khodorkovsky was the first major oligarch put behind bars (after Vladimir Gusinsky and Boris Berezovsky were driven out of the country), but they are not the main reason.

By driving down the value of Yukos shares to a three-year low ­ the company's stock has lost 60 percent of its value so far ­ the Kremlin has made perfectly clear that its aim is to hand over the company at a cut-rate price to the new oligarchs in epaulets who make up Putin's inner circle. And the Kremlin has made no effort to conceal its motives. This means that the West has lost whatever leverage it once had over the Kremlin.

The second cause for pessimism has received far less press than the first. The State Duma recently took up two new laws. One aims to deprive Russia's poor and needy of a range of subsidies and discounts on transportation, medicine and other essentials. The second, a law on the federal bureaucracy, ensures that 2.5 million federal employees will receive the very benefits that the poor stand to lose: free medical care (at the nation's best medical facilities), free use of public transportation, the use of free apartments and dachas, subsidized vacations and more. In short, all the goodies once enjoyed by the Soviet bureaucracy, and which constitute a bonus worth thousands of dollars on top of already generous salaries that were increased by five to 12 times in May and June.

There isn't room here to go into the Kremlin's possible motivation in pushing these laws through parliament. What's amazing is that the Kremlin has made no effort to separate these two laws in the public consciousness. After all, the move to cut subsidies for millions of Russians has proven deeply unpopular, and has driven down Putin's approval rating. The Kremlin has made clear that it no longer cares about public opinion.

No constraints on the Kremlin remain any longer. The Kremlin chekists have crossed the Rubicon; they have no choice but to keep following the course they have set in the past few months. There is no best-case scenario for what happens next, but it's easy to envision the worst-case. Russia is on the fast track to becoming a corporate, fascist-type state. The assault on Yukos will be repeated all across the country against all sorts of businesses, both large and small, though companies in the natural resources, telecommunications and finance sectors are most vulnerable.

In their campaign to seize control of other people's property, the Kremlin chekists will have to come up with a blanket justification. The "war against the oligarchs" line won't work once they start going after medium-sized and small businesses. One way to keep people silent as their neighbors and fellow citizens are plundered is the skillful deployment of nationalism, dividing business owners into the patriotic and the unpatriotic. "You're either with us or against us." You know the rest.

Yevgenia Albats, who hosts a political talk show on Ekho Moskvy radio on Sundays, contributed this comment to The Moscow Times.