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Russia Report: September 10, 2003


10 September 2003, Volume 3, Number 36
KREMLIN/WHITE HOUSE
THE ONE THAT GOT AWAY.
By Brian Whitmore

Vladimir Putin had a fearsome nickname when he served as deputy mayor of St. Petersburg: the Gray Cardinal. Whenever Putin's boss, Mayor Anatolii Sobchak, was having trouble getting what he wanted out of the city legislature, he would send his loyal deputy over to talk sense into disobedient lawmakers.

The dour Putin cut an intimidating presence, and St. Petersburg politicians say his methods reflected his KGB background. He would subtly make it clear to whomever he was persuading that he knew everything about them -- their business dealings and those of their family members, the laws they bent and broke to get where they were, their fears and weaknesses. It was as if he had a dossier on everybody in his head and knew which buttons to push. Needless to say, Putin usually got his way.

And as president he is still getting his way by using similar methods, as the recent investigation into the Yukos oil giant illustrates.

Like other high-profile corruption probes on Putin's watch -- including the ongoing cases against fallen oligarchs Vladimir Gusinskii and Boris Berezovskii -- the consensus on the Yukos investigation is that it has more to do with politics that combating graft.

Yukos CEO Mikhail Khodorkovskii is Russia's richest man, and he is reputed to have political ambitions to match his bank account. When Khodorkovskii began financing political parties like Yabloko and the Union of Rightist Forces (SPS) and rumors spread that he harbored presidential aspirations, Putin decided the oil executive needed to be knocked down a peg -- just like those uncooperative St. Petersburg lawmakers in the early 1990s.

Using corruption allegations as a tool against political enemies has come to be seen as one of the hallmarks of the Putin presidency. But the practice has been an essential component of Russia's political system for the past decade, both at the federal and regional levels. Indeed, corruption allegations and "kompromat" wars are as important a part of how Russia is governed as elections -- if not more so. Nearly everybody in Russia who is rich and powerful has broke or bent some law or another at some point during the chaotic privatizations of the 1990s. And this means that everyone is vulnerable to some degree.

Corruption is a means of control, used by those at the top in Russia to keep the rest of the elite in line. If a powerful person gets investigated or arrested, you can be sure of one thing: he or she must have angered or threatened someone even more powerful.

One of the most illustrative examples of corruption being used as a means of political control occurred in Putin's native St. Petersburg in the mid to late 1990s. In May 1995, Russia's Prosecutor-General's Office dispatched a special investigative team to St. Petersburg to investigate allegations of corruption in the administration of Mayor Anatolii Sobchak.

The group of 30 investigators spent years searching businesses and private residences -- including those of journalists. They violated due process, imprisoned suspects without filing charges, and -- according to the investigation's critics -- blackmailed witnesses and suspects and leaked fabricated stories to the media to manipulate public opinion.

Local journalists, analysts, and many politicians quickly dubbed the case "Leningradskoe Delo," or the Leningrad Case -- a dark reference to Soviet dictator Josef Stalin's infamous purge of the city's leadership in the 1930s and 1940s.

Despite the cynicism, few in St. Petersburg doubted that Sobchak's City Hall -- like most local and regional administrations -- was deeply corrupt. But that, most analysts said, was not the real reason for the investigation. Elections were looming and Sobchak appeared at the time to be headed for an easy re-election in the summer of 1996. That was, until his obscure public works deputy, Vladimir Yakovlev, launched a surprise -- and surprisingly well financed -- challenge against his boss.

The St. Petersburg election was part of a political war that was being fought at the time among various clans inside the Kremlin who were vying for power and influence both in Moscow and, by proxy, in the regions. President Boris Yeltsin's former security chief Aleksandr Korzhakov was supporting Yakovlev's campaign, while his archenemy, Anatolii Chubais, was backing Sobchak. The "Leningradskoe Delo" was an important part of the campaign, targeting not only Sobchak, but also the whole nexus of political, commercial, and media interests that supported him.

"This case -- the 'Leningradskoe Delo' -- was initiated by Korzhakov to discredit Sobchak before the elections," Andrei Piontkovsky, a Moscow-based political analyst, said at the time.

And it worked. Against all odds, Yakovlev defeated Sobchak, albeit by a mere 27,000 votes. After the election, the corruption probe continued -- selectively targeting the political enemies of St. Petersburg's new chief executive. Using law enforcement as a political tool had several goals for Yakovlev: maintaining control over local media, neutralizing those who might finance rival politicians, and punishing those who crossed the city administration on matters deemed important. Sound familiar?

The main target of the investigation was Sobchak himself, who Yakovlev wanted to neutralize as a political figure. In October 1997, Sobchak collapsed and suffered an apparent heart attack during an interrogation over allegations of crooked privatizations on his watch. He fled to Paris, returning to St. Petersburg in the summer of 1999. In October 2000 he died of a heart attack.

Others targeted included:

Dmitrii Rozhdestvenskii, chairman of the television production company Russkoe Video and director of Channel 11, St. Petersburg's second-largest television station. Channel 11, which was partly owned by Gusinskii's Media-MOST, was witheringly critical of Yakovlev. Rozhdestvenskii resisted attempts by Berezovskii, then a Yakovlev ally, to take control of the station. He was arrested in September 1998 and charged with tax evasion and embezzlement. He was released on bail in August 2000 due to poor health and died of a heart attack in June 2002.

Mikhail Mirilashvili, president of the St. Petersburg branch of the Russian Jewish Congress and vice president of the Russian Jewish Congress. Mirilashvili -- a close associate of Rozhdestvenskii and Sobchak -- has had his office searched several times by prosecutors and Tax Police looking for compromising material on Sobchak and Rozhdestvenskii. The owner of several local casinos, Mirilashvili was also widely known to be a financier of Yakovlev's political opponents. He was arrested in January 2001 and charged with kidnapping and organizing a criminal gang. In August 2003 he was sentenced to 12 years in prison.

Larisa Kharchenko, a former Sobchak adviser. Kharchenko was arrested in July 1997 on suspicion of bribery and abuse of administrative powers and imprisoned for six months before being released on bond in December 1997. Kharchenko claimed that prosecutors denied her medical attention in an attempt to extort information about Sobchak. Kharchenko, who suffered from both high blood pressure and a stroke during her incarceration, was hospitalized for two months after her release. She was never formally charged.

Yurii Kravtsov, former speaker of the St. Petersburg Legislative Assembly. When Kravtsov sought to make the local executive branch more accountable to the legislature, he drew Yakovlev's wrath. In June 1996, prosecutors opened a criminal case against Kravtsov and two municipal housing officials, Alexander Klimenko and Konstantin Serov. Prosecutors alleged that Klimenko and Serov used public funds to repair Kravtsov's apartment. After a long trial, a federal district court cleared all three of any wrongdoing in January 1998.

One person in Sobchak's inner circle who escaped the probe, however, was Putin, although he too was accused in the media of corruption.

Putin was deeply involved in a 1992 deal, dubbed the "food-for-metals" scandal, when he was the city's deputy in charge of investment and trade. Under the guise of saving St. Petersburg from famine, Putin came up with a plan to ship $122 million worth of raw materials abroad in exchange for food. He signed deals with 19 companies to act as middlemen. The food never showed up, and the money disappeared.

After the 1996 elections, Putin took a series of Kremlin posts and was named FSB director and, eventually, prime minister before winning the presidency. Some say Putin's star was rising too quickly, and he had too many powerful patrons in the Kremlin, to be brought down in the anti-Sobchak probe. Or maybe he just had enough information on the rest of the elite to make him untouchable.

Brian Whitmore is a Prague-based journalist who covered Russia from 1996-2000.

ELECTIONS
KILLING THE MESSENGER?
By Andrei Deriabin

In about two weeks, the All-Russia Center for the Study of Public Opinion (VTsIOM) should publish the results of another monthly national opinion poll ranking Russia's political parties and politicians. Political observers both in Russia and abroad are waiting to see whether the recent pressure on the institute will have its desired effect. Last month -- despite fears that its entire management would be replaced -- the center again published results showing that the pro-Kremlin "presidential" party, Unified Russia, is lagging behind the Communist Party. Unified Russia's rating was lower than it was the preceding month, just 23 percent compared to the Communists' 28 percent (see http://www.wciom.ru/vsiom/new/press/press030820_24.htm).

Despite its official status as a state-owned enterprise, VTsIOM has operated for the last 15 years independently, without funding or direction from the state, and it has gained an international reputation for accuracy and responsibility. So it came as a surprise to the scholarly and journalistic community both in Russia and abroad when VTsIOM director Yurii Levada announced at a Moscow press conference on 5 August that the institute would be soon transformed into a joint-stock company with 100 percent state-owned capital. It would also get a new board of directors with representatives of the presidential administration and the Labor and Social Affairs and Property Relations ministries and a new management team.

Why was the federal government rushing to "fix" something that did not appear to be broken? Soon after Levada's press conference, a series of articles in the press linked the center's reorganization with the Kremlin, which had reportedly become dissatisfied with the results of VTsIOM research showing a swift decline in Unified Russia's ratings beginning when Interior Minister Boris Gryzlov took over as chairman of the party's Higher Council in November 2002. According to Levada, VTsIOM first found itself in trouble in January, when Unified Russia's poll ratings fell for the first time, "Gazeta" reported on 7 August.

Two weeks after Levada's press conference, a new board of directors for the institute was established. But the new board members and representatives of Unified Russia were quick to dismiss any political subtext to the center's reorganization. One new member, First Deputy Labor Minister Valerii Yanvarev, promised that the transformation will not substantially change the functioning of the center, adding that he considers the work of Levada and VTsIOM in general to be very important, "Yezhenedelnyi zhurnal," No. 83, reported. Similarly, Vladimir Pekhtin, head of the Unified Russia-Unity faction in the State Duma, told the weekly that speculation that his party wants to use a reorganized VTsIOM to manipulate public opinion during the election campaign are ridiculous. "The privatization [of VTsIOM] will hardly be finished by December [when the State Duma elections will take place], so the task of changing VTsIOM forecasts [before then] is just not feasible," he said.

Nobody at VTsIOM thinks that the state's move to take control of the center is aimed at direct manipulation of sociological-survey data. The current political situation is already favorable for today's "party of power," VTsIOM specialist Lev Gudkov commented to "Yezhenedelnyi zhurnal." "The effect of the data falsification is much less than the administrative resource [the party of power] possesses," he said.

Levada told the weekly that the move to neutralize VTsIOM points to an irrational "control-freak" type of logic among Moscow's power that be. The elite has a tendency to apply "excessive pressure" wherever possible, he said. "In the states where the authorities seek to control everything, there is inevitable trend toward excesses," Levada said. "Excessive propaganda, excessive fear of alternative opinions, [excessive urge to] control not only most influential TV channels but all media -- according to the principle of 'excessive pressure.' This is now applied to the sociological surveys too... Today, the authorities are excessively afraid of everything. We are dealing with a powerful group that is exceptionally worried about any tiny stain on their reputations. They have neither history nor a serious foundation, so they feel very vulnerable, although nothing is really threatening them directly. That's where their preoccupation with the polls and undue fears about their results comes from."

Levada and his colleagues also have two other theories to explain the state's attack on VTsIOM. One of them concerns the 2008 presidential election, the outcome of which -- unlike the 2004 elections -- is not obvious for the so-called St. Petersburg clan. In an interview with "Novoe vremya," No. 34, Levada noted: "Nobody's really interested in what happens during the elections of 2003-04. What's important is what happens in 2008, the next political cycle. Preparations [for that] have already begun." According to the second theory, VTsIOM, which constantly reports high public trust in President Vladimir Putin, could be impeding a group or individual's attempts to mislead the president about his electoral vulnerability, according to "Yezhenedelnyi zhurnal."

Levada's August prediction that the center's management team will be replaced within a month have not been realized. In the meantime, "Moskovskie novosti" in late August published a letter from a group of 34 French social scientists expressing their indignation about the government efforts to change VTsIOM's leadership. Professors Vladimir Berelowitch and Alain Blum of the School of Higher Education and Social Sciences (EHESS), Daniel Bertaux of the French National Center for Scientific Research (CNRS), and others wrote that "by abolishing VTsIOM in its present form and depriving both Russian and foreign scholars of a unique tool for the study of contemporary Russian society, the authorities are damaging not only sociological studies, but democracy as well."

Andrei Deriabin is an independent media analyst and director of the nonprofit partnership Development Policies in Novosibirsk.

PARTIES
SPS CONGRESS CONFIRMS TOP CANDIDATES...
The SPS confirmed its plans for the State Duma elections at its party congress in Moscow on 8 September, Russian media reported. As expected, delegates confirmed that the top three candidates on the SPS party list will be SPS leader Boris Nemtsov, Duma Deputy Speaker Irina Khakamada, and Unified Energy Systems (EES) head Anatolii Chubais. The inclusion marks a shift in strategy from 1999, when the newly formed SPS kept the controversial figures Chubais and former acting Prime Minister Gaidar out of prominent spots on the party list. SPS press secretary Yelena Dikun told Interfax that the congress agreed not to nominate candidates in single-mandate districts that have been "prioritized" by Grigorii Yavlinskii's Yabloko party. Yabloko's party congress on 7 September adopted an appeal urging the SPS to coordinate candidates with Yabloko in 50 of Russia's 225 single-mandate districts, "Kommersant-Daily" reported on 8 September. (Laura Belin)

...AS DOES LDPR CONGRESS.
Vladimir Zhirinovskii will top the party list of his Liberal Democratic Party of Russia (LDPR) in this year's Duma elections, an LDPR congress in Moscow confirmed on 8 September, Russian media reported. Zhirinovskii also headed the LDPR list in the 1993 and 1995 Duma elections, but in 1999 he led the Zhirinovskii Bloc instead after the LDPR was struck from the ballot. The second and third candidates on the LDPR list will be the relatively obscure Colonel Pavel Chernov of the Federal Security Service reserves and Aleksei Ostrovskii, an aide to the LDPR's Duma faction, Russian media reported. RTR quoted Zhirinovskii as saying that LDPR Duma Deputy Aleksei Mitrofanov will run for mayor of Moscow in an election that will also be held on 7 December. (Laura Belin)

PARTY OF RUSSIA'S RENEWAL GETS NEW LEASE OF LIFE?
The Party of Life, which is headed by Federation Council Chairman Sergei Mironov, has agreed to form an electoral bloc with the Party of Russia's Rebirth, which is led by State Duma Speaker Gennadii Seleznev, Seleznev announced on 6 September at his party's congress, Russian media reported. According to NTV that day, a formal announcement about the formation of the bloc will be made on 14 September. Seleznev added that it is too early to say who will be the top three candidates on the bloc's party list. According to RTR, congress delegates approved the move without debate and easily adopted an emblem for the party: a white, blue, and red dove. JAC

YABLOKO STICKS WITH THE OLD...
At its ninth party congress on 6 September, Yabloko approved its party list for the 7 December State Duma elections, Interfax reported. Party leader Yavlinskii and State Duma deputies Vladimir Lukin and Igor Artemiev will occupy the top three spots, in that order. Delegates also confirmed a list of 216 candidates running in single-mandate districts by a vote of 266 in favor and 16 against. Human rights activist and State Duma deputy Sergei Kovalev will also run on the Yabloko party list, as well as investigative journalist Aleksandr Minkin, "Izvestiya" reported on 7 September. Earlier, "Nezavisimaya gazeta" reported that Lukin, 66, would not be offered his traditional spot on Yabloko's list because the party is trying to appeal to younger voters (see "RFE/RL Newsline," 11 April 2003). JAC

...AS YUKOS WINS SPOTS ON COMMUNIST PARTY LIST.
At the Communist Party of the Russian Federation's (KPRF) ninth party congress on 6 September, delegates also approved the make-up of its party list as well as a list of candidates for single-mandate districts, ITAR-TASS reported. The top three names on the KPRF's party list will be party leader Gennadii Zyuganov, Federation Council representative Nikolai Kondratenko (Krasnodar Krai), and Agro-Industrial group head Nikolai Kharitonov. Kondratenko, a former governor of Krasnodar Krai, has achieved international notoriety for his anti-Semitic comments. Other names on the list are cosmonaut Svetlana Savistkaya, Nobel Prize-winning physicist and State Duma Deputy Zhores Alferov, Communist Deputies Valentin Kuptsov and Ivan Melnikov, and Russian Communist Worker's Party leader Viktor Tyulkin. In what the agency described as a surprise development, Gennadii Semigin, chairman of the People's Patriotic Union of Russia's Executive Council, was included in the main section of the party list. According to "Izvestiya," the 13th and 15th spots on the list went to two Yukos managers, Aleksei Kondaurov and Sergei Muravlenko. Two other Yukos representatives, which the daily did not name, reportedly appear on the regional party lists. JAC

ONLY IN RUSSIA?
Liberals and Republicans will campaign together for the Duma now that Liberal Russia co-chairman Viktor Pokhmelkin has joined forces with former Finance Minister Boris Fedorov's Republican Party, "Vremya novostei" reported on 8 September. Their electoral bloc, which also includes the Movement of Car Drivers of Russia, will be called New Course-Automotive Russia. Pokhmelkin and Fedorov will be the second and third candidates on the party list, respectively. According to "Vremya novostei," they are seeking a leader from some other organization to fill the top slot. Pokhmelkin optimistically predicted that his bloc could finish third because Russia has 30 million car owners and 50 million drivers. However, speaking to "Vremya novostei," Institute of Strategic Forecasting President Aleksandr Konovalov pointed out that the Beer Lovers' Party, which ran for the Duma in 1995, failed to convert Russians' widespread love of beer into votes. Even assuming the bloc of Pokhmelkin and Fedorov remains marginal, it could damage the SPS and Yabloko by drawing support from the "democratic" wing of Russia's political spectrum. LB

COMINGS & GOINGS
IN: The Open Russia Foundation, which is financed by oil giant Yukos, bought the independent weekly "Moskovskii novosti" and named former NTV and TVS Editor in Chief Yevgenii Kiselev to be its editor in chief, replacing Viktor Loshak, Russian media reported on 4 September.

RENAMED: The Unity faction in the State Duma decided on 5 September to change its name to Unified Russia-Unity, Russian media reported. Unity faction leader Vladimir Pekhtin told the station that the name change is important because of the upcoming elections and the necessity of clarifying for some voters that the two rivals from the 1999 State Duma elections -- Unity and Fatherland-All Russia -- have now joined forces.

POLITICAL CALENDAR
11 September: General Council of Unified Russia party will meet in Staraya Ladoga

11 September: Former U.S. President George Bush will visit Russia, according to "Kommersant-Daily"

12 September: 50th anniversary of the election of Nikita Khrushchev to the office of secretary of the Central Committee of the Communist Party of the Soviet Union

13 September: The wing of the Liberal Russia party that supports self-exiled former oligarch Boris Berezovskii will hold a party congress in Moscow

14 September: Volgograd will hold mayoral elections

14 September: The left-patriotic bloc led by State Duma Deputies Sergei Glazev and Dmitrii Rogozin will hold its founding congress

17 September: Deadline for regional election commissions to be formed for the State Duma elections

19 September: Mikhail Gorbachev's Social-Democratic Party of Russia will hold a party congress in Moscow

19 September: First reading of the 2004 budget will be held in the State Duma

19 September: CIS Summit will be held in Yalta, Ukraine

21 September: St. Petersburg and Leningrad and Tomsk oblasts will hold gubernatorial elections

22 September: Registration begins for candidates in the 7 December State Duma elections

22-23 September: US-Russia energy summit will take place in St. Petersburg

23 September: The first European-Pacific Ocean Conference will take place in Vladivostok devoted to improving dialogue among intellectuals in European countries and the Pacific region

23 September: The trial of those accused of killing investigative journalist Dmitrii Kholodov will reconvene

24 September: Federation Council will hold its opening session after summer recess

29 September-3 October: The Third World Conference on Climate Change will take place in Moscow

30 September-2 October: The Second All-Russian Sociological Congress will take place at Moscow State University

October: Second Civic Forum will be held, according to presidential Human Rights Commission Chairwoman Ella Pamfilova

October: Israeli Prime Minister Ariel Sharon to visit Russia, according to Reuters

October: President Putin and German Chancellor Gerhard Schroeder will meet in Yekaterinburg

1 October: Thirty-three percent salary hike for budget-sector workers will go into effect, pending the passage of legislation being revised by a conciliation commission

1 October: Monthly minimum wage to be raised to 600 rubles ($19.80), according to Federation Council Chairman Sergei Mironov

1 October: Visas for travel between Poland and Russia will be required

5 October: Presidential election to be held in Chechnya

6 October: British court to consider Russia's request to extradite tycoon Boris Berezovskii

9 October: The commission for administrative reforms chaired by Deputy Prime Minister Boris Aleshin will submit its proposals to the government, according to "Izvestiya" on 14 August

23-26 October: First anniversary of the Moscow-theater hostage crisis

25-26 October: Russian Forum on the development of civil society will be held in Nizhnii Novgorod

26 October: Repeat mayoral elections will be held in Norilsk

29 October: 85th anniversary of the founding of the Komsomol

5 November: President Putin will visit Italy for the EU-Russia summit in Rome

7 November: Campaign for the State Duma elections officially begins

19 November: Deadline for investigators working on the case against Yukos security official Aleksei Pichugin

20 November: Fifth anniversary of the murder of State Duma Deputy Galina Starovoitova

7 December: Bashkortostan will hold a presidential election

7 December: Novosibirsk and Sakhalin oblasts will hold gubernatorial elections

7 December: Moscow expected to hold mayoral election

7 December: State Duma elections will be held

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