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Moscow Times
February 25, 2005
Oligarchs Toy With Their 2008 Options
By Vladimir Pribylovsky
Vladimir Pribylovsky, president of the Panorama think tank, contributed this comment to The Moscow Times.

Despite the word's newfangled interpretation, oligarchy in Greek means "the rule of the few," the well-off few who wield not only economic power, but also political power. Oligarchs are not millionaires sitting behind bars or pining away in emigre exile. They are the wealthy who send other millionaires to jail or force them to flee the country. Or, to rephrase President Vladimir Putin's well-known statement regarding the need to "distance" oligarchs from power, real oligarchs are not those who are distanced. They are the ones doing the distancing.

Oligarchs always divide up into rival clans, gangs and cliques, and the interests of these various groups are addressed and balanced behind the scenes. One of the most hotly debated issues is who gets to be the leader, the prime oligarch. Russia's current prime oligarch, Putin, was the product of a compromise between the interests of several clans prominent toward the end of Boris Yeltsin's presidency, namely the Family surrounding Yeltsin, Moscow Mayor Yury Luzhkov and company, and Petersburg economists linked to former chief of staff and current head of UES Anatoly Chubais. The Family has since disappeared, its turf divided up between two cliques, the Petersburg chekists and the Petersburg lawyers.

The rapidly swelling ranks of the recently forged chekists or siloviki clan can no longer be contained in a single clan. Splinter groups have started to form. The most obvious internal conflict is unfolding at the second level of command. It includes the backroom battle between Federal Security Service chief Nikolai Patrushev and head of the Federal Drug Control Service Viktor Cherkesov. Patrushev is supported by presidential adviser Viktor Ivanov, and Cherkesov by deputy chief of staff Igor Sechin. In the economic ring, the tug of war between Gazprom and Alexei Miller, and Rosneft and Sergei Bogdanchikov continues. Sechin is Bogdanchikov's patron, and Ivanov is Miller's.

Both of these siloviki subgroups still agree -- as do the other oligarch clans -- that Putin is the best president for their purposes. The problem of 2008 is the same for all of them: How can they keep Putin in power after his second term comes to an end?

Both subgroups have their own emergency presidential candidate waiting in the wings.

Viktor Ivanov has been grooming State Duma Speaker Boris Gryzlov -- Ivanov's commercial partner from when they worked together in the St. Petersburg city administration -- as Russia's potential next president. Sechin is lobbying for current Defense Minister Sergei Ivanov. You could call this Sechin-Ivanov clique, which has divided off from the rest of the siloviki, the "Petersburg linguists," as Sechin and Sergei Ivanov both went from the translation section of the philology department at Zhdanov State University into the foreign intelligence business.

Sergei Ivanov nearly became prime minister on two occasions, fall 2000 and spring 2004. To prevent his appointment in October 2000, Ivanov's rivals conducted an undercover operation. A document stamped "Highly Confidential" was leaked to the press and published by the newspaper Stringer. It was titled, "The Tactical and Technical Basis for Transferring Power from the President to His Successor and Simultaneous Reinforcement of the State's Role in Society." It was easy to figure out that the "Andropov II" and "successor" mentioned in the document referred to Sergei Ivanov. The document described how Putin would appoint Andropov II prime minister and then voluntarily anoint him his successor. The second time Ivanov was blocked from taking over as head of the Cabinet, word got out about unsuccessful military maneuvers, during which missiles did not launch properly, and the arrest in Qatar of military intelligence agents who were accused of assassinating former Chechen President Zemlikhan Yandarbiyev.

Until very recently, these candidates were chosen more or less theoretically and just in case. First of all, 2008 still seemed a very long way off. Secondly, no one had any doubts about Putin. The question was merely whether he would push for a third term, leaving Gryzlov and Sergei Ivanov as backups, or whether Putin would become prime minister. Then, the oligarchs would only need to agree on who would be president, and either Gryzlov or Ivanov would do the trick. However, since the beginning of monetization of benefits and other unpopular and impending social reforms -- the most dangerous promises to be housing and utilities reform --the Kremlin oligarchs have started questioning whether it is a good idea to keep focusing solely on Putin. If his ratings continue to fall, the coalition of ruling clans might find it more to their advantage to let Putin take the fall and find a new favorite before parliamentary elections in 2007. They have roughly a year to think it over. If they decide to change the Constitution to suit Putin or his successor, they need to start the process no later than early fall 2006.

It is theoretically possible to make Putin prime minister without changing the Constitution, but were this to happen, the oligarchs would need to find someone dependent and unassuming to become president. This someone would likely be Federation Council Speaker Sergei Mironov. Something along these lines was already discussed in the Kremlin, but it appears that the oligarchs have dismissed this option.

Inevitably, the Constitution will have to be rewritten. The changes may be minor, such as allowing presidents to serve for more than two terms. They could, however, be significant and could shift the balance of power in favor of the prime minister. Yet there is also a third, far more radical option: Russia could adopt an entirely new Constitution in order to make Putin's next term count as his first, not his third.

Rumor has it that spin doctor Gleb Pavlovsky is now working on this very scenario at the request of Dmitri Medvedev, presidential chief of staff and head of the Petersburg lawyer clan.

Then there is political analyst Stanislav Belkovsky's alternative plan for changing the Constitution, which envisions a new parliamentary republic. The parliamentary republic with its figurehead president could be used either way. It could be turned against Putin or used to support Putin. Belkovsky himself says that he sees Putin as the ruling prime minister and Gryzlov as president. In any case, the parliamentary republic plan would make the 2007 State Duma elections far more important than the 2008 presidential election. The way parties are structured and elections are conducted would have to change. Instead of the now discredited United Russia, two or three pro-Putin -- or pro-Gryzlov or pro-Ivanov -- parties would have to be created. Russia could return to elections decided by absolute majority.

It is far from clear, however, what the other groups in power think about these constitutional reforms and specific personnel decisions. For the time being, Putin remains a unifying factor. He continues to be supported by Luzhkov and his gang and by the Petersburg economists. If forced to switch to a new prime oligarch, Chubais, Finance Minister Alexei Kudrin and Economic Development and Trade Minister German Gref will back Sergei Ivanov, while the Moscow City Hall group will waver. They and the Petersburg economists do not have their own strong candidate to put forward, because Luzhkov is not in the best of health, and former Prime Minister Yevgeny Primakov is getting on in years.

No matter what happens, the constitutional changes will represent the interests of the majority of Kremlin oligarchs.

What, then, should we make of Putin's promise not to touch the Constitution, not to change it to allow a third term or any other innovations? Secret service agents give their word only in order to hide their thoughts. Let's not forget that in 2002 to 2003, Putin pledged at least six times not to suspend direct gubernatorial elections. But then in 2004, he did just that.