USTINOV’S FIRING REVEALS CLAN MANEUVERING INSIDE KREMLIN

Russian President Vladimir Putin is known to have a penchant for surprise cadre changes that invariably leave experts second-guessing the move. His decision to sack Prosecutor-General Vladimir Ustinov, taken late last Thursday (June 1) and approved by the astonished Federation Council at the next morning’s session, fits this pattern perfectly (Izvestiya, lenta.ru, June 2). Moscow political circles have been stirred into a frenzy of speculation, particularly since no official explanation for the abrupt punishment was offered except Ustinov’s “own request.” Sergei Mironov, chairman of the Federation Council, was only able to venture an opinion that the decision had a “technical character without any politics or hidden drivers” (Newsru.com, June 1). Equally unconvincing were cautious suggestions from the disciplined parliamentarians that perhaps Ustinov was simply tired after six years in a very demanding job, yet they had confirmed him for a second five-year term just over a year ago.

Another stream of commentary has centered on the belief that Putin is not satisfied with the course of the struggle against corruption (Strana.ru, June 2). This problem has indeed acquired grotesque proportions and is a major impediment to Russia’s economic growth. According to a report from the Consultative Council on Foreign Investment, 78% of potential investors are worried about it, while two-thirds of those already working in the market confirmed that corruption had directly affected their business (Gazeta.ru, June 1). That was, perhaps, the main reason why the Russian market fell deeper than most emerging markets in the unusually volatile last two weeks of May and is recovering slower than other emerging markets, bracing for further “corrections” (Vedomosti, June 2). Ironically, the blue-chips led by Gazprom began their free-fall the day after Putin praised the record-high market capitalization of the Russian “champion,” which, according to him, “did not just come about all on its own, but is the result of carefully planned action by the state” (Vedomosti, May 19).

In the same speech to parliament, Putin condemned corruption as “one of the greatest obstacles facing our development” (Expert, May 15; also see EDM, May 22). Ustinov took these plain words to heart and launched a resolute campaign starting with the customs service, which happened to attract indignation from the president. He then moved against several regional authorities, so that Alexei Barinov, governor of Nenets okrug, and Yevgeny Ishchenko, mayor of Volgograd, found themselves behind bars. More high-profile cases were promised and with that, quite possibly, Ustinov went beyond his mandate. According to Christopher Wifer and several other thoughtful analysts, the struggle against corruption is going to be the key issue for the 2008 presidential campaign, much the same way as war in Chechnya was in 1999 (Vedomosti, May 17). In that case, it must be spearheaded by a carefully chosen successor and not by some over-zealous prosecutor.

Ustinov was too experienced to get carried away by the sway of a righteous campaign; he understood perfectly well that the real content of the struggle against corruption was the competition for power among several clans in Putin’s court. The lucrative customs service, for that matter, had long been an apple of discord — but now it is firmly under control of one of the clans, while nominally subordinated to Prime Minister Mikhail Fradkov (Ezhednevny zhurnal, May 17). Ustinov himself had not been originally a member of Putin’s St. Petersburg team, but he threw his lot resolutely with the clan headed by Igor Sechin, the tight-lipped deputy head of the presidential administration. The chance for Ustinov to prove his loyalty came in mid-2003, when he personally supervised the prosecution of Mikhail Khodorkovsky and his oil giant Yukos; the case was built crudely but driven firmly through the court proceedings, delivering a harsh sentence according to the president’s wishes. After that, Ustinov’s access to the innermost Kremlin circle was sealed by the marriage of his son to Sechin’s daughter (Kommersant, Financial Times, June 3).

While most attention in recent months has gone to Sergei Ivanov and Dmitry Medvedev, two front-runners in the unofficial but very real race of presidential hopefuls, in fact, it was the Sechin-Ustinov alliance that was gaining ground in the Byzantine power struggle. Fradkov, commonly dismissed as a caretaker of no influence, was positioning himself closer to them, while pushing German Gref, the minister for economic development, to resign due to endless reprimands (Kommersant, June 2). According to some sources, Moscow mayor Yuri Luzhkov also sought to build ties with this alliance; his political choices were often disastrous, but his undiminished support base in Moscow secured both phenomenal survivability and useful clout for him (Ekho Moskvy, June 2).

Quite possibly, it was Luzhkov’s involvement that brought Putin’s wrath down on Ustinov’s head. He can be endlessly tolerant of incompetence or greed among his lieutenants, but even a shadow of disloyalty constitutes a mortal sin. It is impossible to guess which of his confidants might have dropped a “strategic” hint about the prosecutor-general’s presidential ambitions. But it is quite clear that Putin, insisting on his intention to vacate the chair on schedule, wants to remain totally in charge of the succession process, keeping the pretenders on short leashes and reserving the final decision. He resents being pushed, whether in orchestrating the struggle against corruption or in conducting the cadre rearrangement, and Sechin, quite possibly, was guilty of pushing the boss too far on a few occasions. Now Putin is free to pull another surprise nomination for the vacant position, as he did with Sergei Sobyanin for the head of his administration.

The setback, shocking as it is, will probably not signify Sechin’s fall from grace and not only because Putin needs to keep balance between the feuding clans, but primarily because for Sechin, the ultimately desirable outcome of the troublesome succession is Putin’s graceful acceptance of a third presidential term.