A year ago the newly appointed deputy secretary of the Security Council, Boris Berezovsky, gave an interview to the Financial Times that was a surprisingly candid manifesto of the Russian financial oligarchy. "We," said Berezovsky in the name of the Moscow group of seven bankers, "hired [current First Deputy Prime Minister Anatoly] Chubais and invested huge sums of money to ensure [President Boris] Yeltsin's election. Now we have the right to occupy government posts and enjoy the fruits of our victory."
For these gentlemen, the fruits of victory meant abusing public office for personal gain. Uneximbank head Vladimir Potanin had been enjoying these fruits from August 1996 until March 1997, when he was dismissed as first deputy prime minister in charge of the economy, and Berezovsky from October 1996 until Nov. 4, 1997. In a previous comment on the Berezovsky interview a year ago, I wrote that "as long as Berezovsky opens the door to Chubais' office with his foot, Russia won't have reform. There will be continued rule of oligarchs who entered the government in order to channel state budget financial flows into their private companies."
The manifesto of the financial oligarchy was so offensive and humiliating to both Yeltsin and Chubais personally that the only possible response of any self-respecting political authority would be, in my view, immediate dismissal of Berezovsky. Yeltsin doesn't read the Financial Times regularly and he had other serious worries at the time. Chubais was undoubtedly familiar with Berezovsky's revelations but he remained silent.
To a large extent, he was hostage to the financial oligarchy system that he himself had helped to create. So there was much truth in Berezovsky's statements and in the no less cynical revelations in an interview with Nezavisimaya Gazeta by Mikhail Khodorkovsky, head of Rosprom, the industrial holding of Bank Menatep. He said, "Politics in the most lucrative field of business in Russia. And it will be that way forever. We draw lots in order to pick out a person from our milieu for work in power."
Chubais seems too ambitious, however, to remain just a manager of a financial oligarchy. His ambition is to go down in the history books as the man who reformed Russia.
Having strengthened his position after the cabinet reshuffle in March, he tried to shake off the Kremlin's incestuous relationship with big business. The Sibneft company was the last acquisition that Berezovsky got for a song. When he tried to do the same with Svyazinvest and Norilsk Nickel in August, he failed. His emergency flight to see Chubais, who was vacationing in France, to settle the issue behind the scenes -- a strange exercise for a politician not involved in business -- was to no avail. Since then, he has unleashed a devastating attack on Chubais and his associates from all the channels of his media empire. Chubais' attempt two months ago to convince the president that he should sack Berezovsky, which was supported by his colleague Boris Nemtsov, also did not succeed.
"I don't design unreliable systems," Berezovsky boasted at a press conference the day after his dismissal.
And indeed he doesn't. He has fortified his strategic line of defense inside the president's family by becoming its actual financial manager, while not losing sight of his private interests, of course. Under the cover of the president's son-in-law, Valery Okulov, the figurehead CEO of Aeroflot, Berezovsky's people have been transferring Aeroflot hard-currency financial flows to the accounts of Berezovsky-owned private companies in Switzerland. In his recent memoirs, former Kremlin bodyguard Alexander Korzhakov described the extravagant gifts Berezovsky routinely lavished on the Yeltsin daughters. Incidentally, it was Berezovsky who financially managed the publication of Yeltsin's book abroad.
Berezovsky's role at the Yeltsin court bore a striking similarity to that of Grigory Rasputin, the notorious "holy man" at the court of the last Russian tsar, Nicholas II. Maybe it was the Russian public, to whom this sinister analogy is becoming more and more evident, that finally helped Chubais and Nemtsov to explain to the president how damaging the presence of Berezovsky at the very top of Russian power was to his personal prestige.
The reaction of high-level state officials to the sacking of Berezovsky was very telling. They were literally afraid to say any more than necessary and avoided any imprudent comments about Berezovsky. They were still not sure that the influential favorite had taken a fall once and for all. Watching them, I recalled a conversation I had with a very prominent Russian politician several months ago.
We both spoke at a seminar about corruption in Russia and the power of the financial oligarchy. After my talk, he told me: "Allow me to give you one piece of advice. You mentioned Boris Berezovsky's name five times today. And I didn't do so once. Do you know why? I have known for too long and too well that man. Be careful. He is very dangerous."
So long as murky business of Okulov and Berezovsky goes on as usual, the reincarnation of Berezovsky into the highest echelons of Russian politics cannot be ruled out. He is still very dangerous.
Andrei Piontkovsky is head of the Center for Strategic Studies in Moscow. He contributed this comment to The Moscow Times.
For these gentlemen, the fruits of victory meant abusing public office for personal gain. Uneximbank head Vladimir Potanin had been enjoying these fruits from August 1996 until March 1997, when he was dismissed as first deputy prime minister in charge of the economy, and Berezovsky from October 1996 until Nov. 4, 1997. In a previous comment on the Berezovsky interview a year ago, I wrote that "as long as Berezovsky opens the door to Chubais' office with his foot, Russia won't have reform. There will be continued rule of oligarchs who entered the government in order to channel state budget financial flows into their private companies."
The manifesto of the financial oligarchy was so offensive and humiliating to both Yeltsin and Chubais personally that the only possible response of any self-respecting political authority would be, in my view, immediate dismissal of Berezovsky. Yeltsin doesn't read the Financial Times regularly and he had other serious worries at the time. Chubais was undoubtedly familiar with Berezovsky's revelations but he remained silent.
To a large extent, he was hostage to the financial oligarchy system that he himself had helped to create. So there was much truth in Berezovsky's statements and in the no less cynical revelations in an interview with Nezavisimaya Gazeta by Mikhail Khodorkovsky, head of Rosprom, the industrial holding of Bank Menatep. He said, "Politics in the most lucrative field of business in Russia. And it will be that way forever. We draw lots in order to pick out a person from our milieu for work in power."
Chubais seems too ambitious, however, to remain just a manager of a financial oligarchy. His ambition is to go down in the history books as the man who reformed Russia.
Having strengthened his position after the cabinet reshuffle in March, he tried to shake off the Kremlin's incestuous relationship with big business. The Sibneft company was the last acquisition that Berezovsky got for a song. When he tried to do the same with Svyazinvest and Norilsk Nickel in August, he failed. His emergency flight to see Chubais, who was vacationing in France, to settle the issue behind the scenes -- a strange exercise for a politician not involved in business -- was to no avail. Since then, he has unleashed a devastating attack on Chubais and his associates from all the channels of his media empire. Chubais' attempt two months ago to convince the president that he should sack Berezovsky, which was supported by his colleague Boris Nemtsov, also did not succeed.
"I don't design unreliable systems," Berezovsky boasted at a press conference the day after his dismissal.
And indeed he doesn't. He has fortified his strategic line of defense inside the president's family by becoming its actual financial manager, while not losing sight of his private interests, of course. Under the cover of the president's son-in-law, Valery Okulov, the figurehead CEO of Aeroflot, Berezovsky's people have been transferring Aeroflot hard-currency financial flows to the accounts of Berezovsky-owned private companies in Switzerland. In his recent memoirs, former Kremlin bodyguard Alexander Korzhakov described the extravagant gifts Berezovsky routinely lavished on the Yeltsin daughters. Incidentally, it was Berezovsky who financially managed the publication of Yeltsin's book abroad.
Berezovsky's role at the Yeltsin court bore a striking similarity to that of Grigory Rasputin, the notorious "holy man" at the court of the last Russian tsar, Nicholas II. Maybe it was the Russian public, to whom this sinister analogy is becoming more and more evident, that finally helped Chubais and Nemtsov to explain to the president how damaging the presence of Berezovsky at the very top of Russian power was to his personal prestige.
The reaction of high-level state officials to the sacking of Berezovsky was very telling. They were literally afraid to say any more than necessary and avoided any imprudent comments about Berezovsky. They were still not sure that the influential favorite had taken a fall once and for all. Watching them, I recalled a conversation I had with a very prominent Russian politician several months ago.
We both spoke at a seminar about corruption in Russia and the power of the financial oligarchy. After my talk, he told me: "Allow me to give you one piece of advice. You mentioned Boris Berezovsky's name five times today. And I didn't do so once. Do you know why? I have known for too long and too well that man. Be careful. He is very dangerous."
So long as murky business of Okulov and Berezovsky goes on as usual, the reincarnation of Berezovsky into the highest echelons of Russian politics cannot be ruled out. He is still very dangerous.
Andrei Piontkovsky is head of the Center for Strategic Studies in Moscow. He contributed this comment to The Moscow Times.