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Russia: Yeltsin's Re-Organization Frees Chubais' Hand

Moscow, 12 March 1997 (RFE/RL) -- Swiftly implementing last week's pledge to radically change the government, Russian President Boris Yeltsin yesterday sacked the entire cabinet except Prime Minister Viktor Chernomyrdin and his newly-appointed first deputy, Anatoly Chubais.

Yeltsin's decree came as no surprise to Moscow's political elite. He followed, however, with an unexpected appointment of former journalist Valentin Yumashev, who lacks administrative experience, as presidential staff chief, Chubais' old job.

These moves seem to indicate that Yeltsin means to downgrade the powerful presidential office and strengthen the government as the real center of power in Russia.

Russian media note today that the two decisions seem to concentrate power in Chubais. The president made him head of the presidential administration after he engineered Yeltsin's re-election last year and he played a key power role during the nearly eight months of Yeltsin's illness.

Chubais is recognized widely as a capable organizer and as a committed, liberal-minded economist. His skills are viewed as important for the re-organization of the government and boosting Russia's stalled economic reforms.

The appointment of Yumashev as Yeltsin's chief of staff seems to indicate that Chubais will keep a measure of control over this office, too. Yumashev has been a Yeltsin family friend for the last eight years. Observers say that his loyalty to the president personally, as well as to the Yeltsin family and circle of allies, was a consideration in his appointment, overcoming his lack of experience.

Russian NTV television reported this morning that Chubais and Chernomyrdin have started formal talks on the composition of the new cabinet, to be approved and made public by Yeltsin within the next few days.

The director of the Moscow Center for Strategic Studies, Andrei Piontovsky, tells our correspondent that Yeltsin's decrees yesterday gave to Chubais, more than to Chernomyrdin, leeway to choose the new cabinet. Piontovsky says Chernomyrdin's cabinet clearly was unable to carry out liberal reforms. It was, he says, a coalition of representatives of different lobbies interested in increasing their own wealth through free access to the state's financial resources.

Piontovsky says that Chubais probably will encounter severe difficulties in implementing Yeltsin's will to restore order in Russia, boost economic reform, pay pensions and salaries on time, and fight high-level corruption. He says Chubais' problems are likely to be both personal and professional in character. He says the goals Yeltsin put forth in his state of the nation address last week run counter to the interests of the financial oligarchy with whom Chubais has been linked since the presidential campaign last year.

He suggests that the composition of the new cabinet will provide early clues to the tactics Chubais will employ to reduce conflict with the financial oligarchy and with the powerful industrial lobbies that traditionally have supported Chernomyrdin.

By keeping Chernomyrdin in office, Yeltsin avoids having to seek approval for a new cabinet from the Communist-dominated Duma. The lower house of parliament has expressed opposition to Chubais' appointment to the cabinet and to Yeltsin's government reorganization. The legislators today adopted a resolution saying that implementing program that Yeltsin presented in his state of the nation address will lead to political, economic and social crisis in Russia.

Yeltsin's decision to keep Chernomyrdin in office also seems to be a reward for his loyalty during the last four years as prime minister. Business circles in Russia and the West consider Chernomyrdin a key to stability.

The prime minister so far has avoided any indication that he is hungry to take over from Yeltsin. Critics, who consider Chernomyrdin no more than a stolid bureaucrat, say he lacks the stature to succeed Yeltsin. But supporters say he could win the year 2000 presidential election if the state machinery would unite behind him.

Russian political observers say today that the main conclusion to be drawn from yesterday's announcement is that Yeltsin has adopted his prime minister's proposals for government reorganization. If Chubais succeeds in revitalizing Russia's government, the political dividends will boost Chernomyrdin's prospects. If he fails, Chubais, not Chernomyrdin, could get the blame.