THE KREMLIN’S NEW MOVE: DEMILITARIZING THE GOVERNMENT, DE-CAPITALIZING SOCIETY, OR A GAME OF ODD MAN OUT?

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“For the first time in over a year as president, Putin has acted like Yeltsin”, commented the Novye Izvestia newspaper on the Kremlin personnel changes. From now on, we can say that in choosing candidates for key government jobs, the president “takes into account not their professional qualities, and thus their potential significance for the state, but only their personal loyalty to the master of the Kremlin. And their unconditional obedience.”

Kommersant published the full speech of President Putin at his news conference. Putin stated that the new appointments “should become the logical conclusion to modernization of the military structure”; he also connected them to the changed situation in Chechnya. Novye Izvestia considers both statements rather disputable.

According to the paper, only Sergei Yastrzhembsky is able to find some positive trends in the Chechnya situation, “since this is his duty”. In fact, the situation is still far from peaceful in the North Caucasus: “Just like a year ago, Russia still loses up to twenty soldiers a day – almost one Kursk submarine a month – and there is no end to this.”

Another statement by President Putin also doesn’t hold up: according to him, appointment of Vladimir Rushailo as the secretary of the Security Council has been caused by concern about progress on the peace settlement in Chechnya: “Rushailo had enough authority in his previous position to demonstrate his capacities on the Chechnya front. However, …the minister paid much more attention to mysterious contracts with behind-the-scenes leaders of the North Caucasus, than to organizing a serious counter-action to the Chechen guerrillas.”

Appointment of Boris Gryzlov, former leader of the Unity Duma faction, as Interior Minister, is no more logical, as he has no experience in fighting organized crime: even the president called this appointment “political”.

Novye Izvestia concluded that the observers were struck not only by suddenness and decisiveness of the presidential action, but also by the extent of secrecy – no leaks were noted: “All the preliminary negotiations of the president with the candidates were absolutely confidential.”

As a result, Novye Izvestia considers that only one person benefits from the situation: the master of the Kremlin, who “has removed the protege of the Family from the Interior Ministry and with one move turned a powerful security structure into a bureaucratic body. As well as the Defense Ministry, which is now headed by a former intelligence officer.”

According to the paper, if we follow this reasoning, not the officially declared one, the recent personnel changes can be considered a success: “Putin has looked out of the Kremlin and made a move.”

The Segodnya paper also noted the president’s comment that the Security Council headed by Vladimir Rushailo will now pay more attention to the problems of the North Caucasus. According to Segodnya, “this may mean that Rushailo is in charge of all the emergency situations in this problematic region.”

However, as the president once noted, “whatever we are dealing with is connected with Chechnya”. Komsomolskaya Pravda quotes him on this, and also mentions that there is a theory about “the elimination of the Security Council as an almost omnipotent body”; however, this theory is considered unlikely, since “relations between the president and the former defense minister remain fairly good.”

Besides, according to Segodnya, the fact that none of the newly-appointed people is connected with the Family does not mean that Yeltsin’s old guard has been completely excluded from state decision-making. “On the other hand, the members of the Family are becoming the most vulnerable of the three factions in the Kremlin (the Family, the liberals, and the St. Petersburg security officers).” On the contrary, the position of the latter has strengthened after Sergei Ivanov, who is regarded as the leader of this group, was appointed as Defense Minister. However, all this concerns Russia’s domestic affairs, Segodnya notes. From now on, Ivanov will be considered abroad not as the president’s right-hand man, but “just a minister”: “Technically, the position of defense minister after the position of the secretary of the Security Council, who had been in charge of all the security of the country, seems to be a demotion.”

The Rossia paper quotes the opinion of Thomas Graham, an expert in Russia-US relations with the Carnegie Foundation: “From the point of view of Washington, the only appointment that draws attention at once is that of Sergei Ivanov as Defense Minister.”

Graham also stresses that until recently, Washington considered that Ivanov was a key figure in Putin’s government, and played an important role in forming the foreign politics of Russia in security questions – that is why his being the secretary of the Security Council was quite logical. Mr. Graham continues: “Now, when Ivanov leads the Defense Ministry, the major question is: to what extent he will be able to influence the foreign politics and security of Russia. So far, there has been no response.”

At the same time, Mr. Graham supposed that appointment of Ivanov is to some extent connected to the new reality of the Russia-US relations, in particular, to the issue of the US anti-ballistic missile defense system and control of strategic weapons. Graham says: “Having appointed his work fellow as head of the Defense Ministry, Putin has created a situation when it will be Ivanov who will be resolving all the issues with his US opponent, Defense Secretary Donald Ramsfield.” The US does not rule out that thus President Putin “wants to open a new channel for communication between the Kremlin and the Bush-junior administration.” Mr. Graham even assumes that this channel can become the major thing in the relations between the two countries in the near future.

The Kommersant paper writes about the forthcoming serious personnel changes in the Defense Ministry.

According to the sources of the paper, the proteges of ex-defense minister Igor Sergeev will be dismissed from the Defense Ministry and the General Staff first of all. They are: Colonel General Vyacheslav Meleshko, aid of the Defense Minister, and Colonel General Ilya Panin, head of the main personnel department of the General Staff; after the end of the spring recruitment campaign, they are to be followed by Colonel General Vladislav Putilin, head of the main organization-mobilization department of the General Staff.

According to Kommersant, appointment of Sergei Ivanov as head of the Defense Ministry means creation of a principally new control system in the Russian Armed Forces. First of all, this system will include a separation of the functions of the Defense Ministry and the General Staff. The Defense Ministry will focus on military reforms, arms procurement, defense funding, and arms sales. The General Staff will have to carry out operative and strategic management of the Armed Forces, planning their combat deployment, combat training, and so on. At the same time, the General Staff will still be directly subordinated to the Defense Ministry.

Thus, by means of a radical intervention, the president has solved a long-term conflict between the defense minister and the chief of the General Staff on the direction of the military reform. Sergeev has been honorably dismissed. It is not ruled out that in the near future, General Staff head Anatoly Kvashnin will follow him: according to Kommersant, “Sergei Ivanov would not like to work with a subordinate, who had once opposed his direct superior.” Kvashnin is said to be suggested a position of deputy secretary of the Security Council. Officially, it is very easy to find a motivation for such an appointment: “Currently, the Security Council is concentrating its effort on solving the Chechen problem; and it is hard to find a person who is more competent in these questions, that former commander of the North-Caucasian military district Anatoly Kvashnin.”

The Segodnya paper stresses that “The Security Council has ceased to exist as a political institution and a decision-making center.” Moreover, according to the paper, it is undoubtedly favorable for the president that from now on all the security structures, including the Interior Ministry and the Federal Security Service, are controlled by the president’s supporters.

On the other hand, “leader of the security structures” Sergei Ivanov has become one of the many ministers; and, consequently, there will be no “single influence center”. According to the forecasts of Segodnya, there is every reason to believe that “healthy competition” between the security structures will be no less of an influence on their behavior than their willingness to cooperate.

The paper also mentions that there are other, no less important consequences of the March 29 personnel revolution. It is not ruled out that the president will choose his administration as his next “victim” – after the Security Council stops playing the role of its political counterweight.

Apparently, either the leadership of the presidential administration will be replaced (Alexander Voloshin and Surkov); or, as a result of structural changes, the role of this administrative institution will be reduced to the level of a strategic secretariat. The Segodnya paper also considers it very likely that the positions of presidential aides for various sectors will be fully restored, which will deprive the presidential administration of its political functions.

Further changes will depend on the current personnel resources. The “second echelon” of the St. Petersburg team will probably be promoted to the key positions – people such as Dmitry Kozak, or Dmitry Medvedev. As for the long-expected Cabinet changes, they will entirely depend on the option of the social-economic policies the president chooses.

According to Segodnya, if Putin decided to make an “attempt at a liberal break-through”, he will need a “kamikaze prime minister”; the paper believes that Anatoly Chubais would be the best candidate for this role. But as Chubais is mostly regarded as a “man of the past”, Herman Gref and Andrei Illarionov have the best chances. And if President Putin chooses a moderate and flexible socio-economic course, Sergei Stepashin is likely to become prime minister.

The paper also stresses that the president will have to make his choice as soon as possible: “The personnel revolution which has been started cannot be stopped half-way.”

In another article, the Segodnya paper concludes that Herman Gref is the most likely candidate for prime minister, right after the president makes his annual address to the Federal Assembly. Thus, the personnel revolution would be crowned by a total victory for the “St. Petersburg team”: Ivanov will be in charge of the security sector, Gref will control the economic sector.

As for Alexander Voloshin, who is in fact the second after the president man in the Russian top power circles, it is clear that President Putin is hardly likely to be satisfied with such a situation. It is supposed that Voloshin will become the head of Russian Joint Energy Systems (RJES) instead of Anatoly Chubais, who will be in charge of forming a “full-value right-wing party”, which would support Gref’s liberal reforms.

If President Putin goes ahead with this scenario, Segodnya reflects, this will mean his final transformation “from an image into a political figure”.

Thus, the “popularity rating, that has until now been the untouchable resource of the president, will be ‘invested’ in the project of sweeping reforms in Russia”. However, the paper concludes, it is still hard to say how successful that investment would be.

The Vremya MN paper considers two options for further development of the situation. According to the paper, the first option correlates with the “wishes of the liberals, who a year ago declared Putin the Russian Pinocet”.

At the same time, the paper thinks it is necessary to warn that realization of the super-liberal program by Herman Gref will inevitably lead to the growth of the social tension and, probably, to mass demonstrations of protest. And the “politically appointed head of the Interior Ministry” will have to suppress them.

However, the Vremya MN stresses, not only liberals, who usually refer to Yevgeny Yasin and the Financial Times have lately actively used the phrase “the lost year of Putin”, but also the ultra-left.

In particular, the Zavtra paper, that usually publishes the protocols of meetings of the “Russian shadowy government”, is also eager to stir up the course of the reforms. At the same time, the left wing obviously expects the president to turn the security bloc of the Cabinet not into “an instrument for carrying out liberal economic reforms, but a subject of an economy which can only be called a mobilization economy”.

From this standpoint, the statement of Sergei Ivanov on the need for re-equipping the army should be considered as a “concession to the military-industrial sector”. The paper asks: can this conceal some intentions of the Cabinet to remove a considerable sector of the economy from the market sphere and budgetary control? According to Vremya MN, it is this “hybrid of the market reforms and non-market sector of the state control” is the most possible option for development of the country.

The Finansovaya Rossia weekly writes about the “military-industrial renaissance”. The weekly notes: “It seems the time for the generals of the Russian defense sector has come.” As we know, deputy Prime Minister Ilya Klebanov proposed at the State Council Presidium a plan for reforming the military-industrial sector, which was approved. Now, the Cabinet will have to implement this plan, which means to “gather together all the remains of the once gigantic Minsredmash; to joint the enterprises into large concerns and holdings; and to distribute a considerable piece of the budget pie among them.”

Answering the question on the reasons for such an unexpected care about the fate of the Russian defense sector, the paper says directly: According to expert assessments, over the period of reforms, the military equipment and weapons of the Russian Armed Forces have become 90% worn out. Over the same period of time, the armies of US and Western European countries have replaced 50-60% of their armaments. The war in Chechnya has shown very clearly that the Russian Army is very weak.

President Putin realized the danger of the rushing turning of the Russian Army into a partisan movement right after the first army operations in Buinaksk, Dagestan. That is when Ilya Klebanov, Putin’s fellow native of St Petersburg, a general of the defense sector, who is said to be greatly trusted by the president, was charged with reforming this large area of the Russian economy. Soon after that, five agencies appeared on the basis of about 1700 enterprises: ammunition, ship-building, arms, aviation, and control systems. Over the past year, these enterprises have received some real financial aid for the first time. First, the state considerably reduced its debt for the military hardware and arms the army had already bought, which is about 7 billion rubles. Second, funding of high-tech research and development has been also considerably increased. According to Finansovaya Rossia, “Now, the once powerful enterprises have a chance to regain their former glory. They will be receiving up to 45% of all defense spending. The new hardware will start being supplied in three to four years.”

Meanwhile, Pavel Felgengauer, a military observer of the Moskovskie Novosti paper, considers that it was the “total miniaturization of the economy and society inherited from the Soviet Union” that became the real reason for the almost complete failure of the reforms of the past decade.

The Soviet economy was unprofitable from the very beginning, since it was founded on the mobilization basis, “for a relatively short break-through into a ‘special’ period before a third world war, which was supposed to guarantee Russia a victory.” Such trifles as efficiency and competitiveness were never really taken into consideration then.

Felgengauer writes that in today’s Russia, just as in Soviet Union before, there are mobilization plans, mobilization capacities are out of business, and there are whole “strategic industries” that “in the long run, Russia does not need at all”. The economy is still non-competitive, and that is all attempts of modernization and integration into the world market are rejected.

The military observer of Moskovskie Novosti hopes that Putin has appointed Ivanov as head of the Defense Ministry not in order to reduce the number of the Russian Armed Forces once again, which is unable to aid to solve any serious problems, but in order to carry out total demilitarization of the industry (“as it was done in Japan and Germany after World War II”). As well as in order to reduce the “global imperial ambitions of the Defense Ministry and the military-industrial sector”. In this case, Felgengauer believes, Russia will be able to restore.

However, the author notes, over the past year, so many correct statements have been said, which were never followed by any concrete deeds, that it is very hard not to be skeptical: “Probably, in year it will turn out again that the reforms are not carried out, that the “bad subordinates” are failing to cope with them again, and that one more personnel change like the current one is needed”.

The Izvestia paper states that “The changes in the security structures have nothing to do with demilitarization. Does it matter what shoulder straps our new ministers used to wear? It is a real de-capitalization.”

According to Izvestia, the point of the recent personnel changes is that the “epoch of capitalist-ministers, whose duty was to financially lobby projects, which in some way concerned their ministries, is coming to its end. Now, they will be replaced by ministers-political leaders, such as Sergei Ivanov in the Defense Ministry, or Boris Gryzlov in the Interior Ministry.” In other words, financial lobbying will be replaced by political lobbying, which will be “the end of the world for the Russian oligarchy that has established over the past decade”.

So far, the whole political system of Russia was founded on “concrete people, who possess financial resources (tycoons), HIRED the power. from now on, it will be a difficult story: “concrete people, who possess political resources, will be turning their resource into financial – they will HIRE the large capital, which will be no longer “tycoons” capital any longer.”

So, Izvestia consider the recent personnel changes a historical event: “In the end of March 2001, the Russian power separated from the Russian business.”

According to the paper, currently, establishment of the institution of the presidential envoys in the federal districts, becomes logical: “There really is a power hierarchy in the country now. The presidential envoys will be forming “the leadership” in their districts, as well as the president will be forming it in the whole country.”

Itogi magazine commented on Putin’s personnel revolution: “The president has made another attempt to form the power hierarchy in the country. This time he has appointed envoys to the security structures.” The magazine notes that at first glance, the presidential “castling” most of all remind of children’s game “third-the-odd”. Secretary of the Security Council moved to the position of the Defense Minister; the head of the Interior Ministry moved to the position of the secretary of the Security Council; the leader of the Unity Duma faction appointed has head of the Interior Ministry…

The magazine also stressed that the president did not trouble himself with giving any explanations. Apparently, the head of state thinks that explanation and interpretation of his activities is the matter of “specially trained people”. However, the Itogi states, that official propagandists, who found out about what had happened with the rest of the country have failed to do their job well. Sergei Yastrzhembsky, who had been sent to the presidential informational foundation right on the threshold of the event, issues an “as usually beautiful and bright, but absolutely senseless slogan: “Decisions of the president are the evidence of personnel stability.”

“Politically appointed” Boris Gryzlov was even worse when he announced about his readiness to “support Putin’s ideas” in the Interior Ministry.

Kremlin’s major ideologist Gleb Pavlovsky gave his own explanation to the Kremlin’s appointments: “Instead of personnel service and department belonging – political definition, skills, and verified concepts.”

However, the Itogi does not regard this logic as convincing. From the point of view of the magazine, having started the process of personnel changes (which, unlike Yeltsin’s upheavals is likely to last for a considerably long time), the president “is primarily intending to make the federal structures more transparent. Not for society, but for himself.”

There is only one objective: to appoint as heads of ministries people whom the president can trust and who are connected not by a “departmental incorporation, but by belonging to the team of the head of state”.

According to the magazine, the action was caused by the failure of the last year’s attempt to establish the well-known power hierarchy.

The first attempt failed: not very many of Putin’s supporters, who were also deprived of any “ideology”, failed to cope with the huge volume of problems. the only thing they had succeeded at was driving the regional leaders from the Federation Council; as for the rest – the “bureaucratic machine continued its work”.

Moreover, problems and crises started in the presidential team as well: for instance, after the Kursk nuclear submarine disaster, the president faced a lack of reliable information in the key department for such issues: the Defense Ministry. The magazine also recalls the Primorie crisis, when the “leaders of the security structures, including the General Prosecutor, instead of fulfilling the order, started to explain to their patron why they could not or would not implement it”.

Itogi considers that the method the president has chosen for realization of the second attempt of reinforcement of the power hierarchy, is likely to help resolve the issue of inter-governmental scandals: “Who will risk arguing with the presidential double, especially in public?”

However, the Itogi is convinced that “the new stage of forming the power hierarchy is doomed to fail if the administrative reform is not carried out as soon as possibly, since it would considerably restrict the right of the bureaucracy and would deprive the middle layer of officials of their right to interpret the law”. Currently, all the issues that spoiled the life of the president will now be moved a layer lower: to the officials appointed by the president.

The Vek weekly considers the new Putin’s appointments an “overture to the presidential address” (meaning the presidential address to the Federal Assembly). According to Vek, making the personnel changes, President Putin wants first of all signal that he “is strong and self-confident”.

In fact, the weekly reflects, the appointment of a civilian defense minister in Russia is a difficult move. Even former president Boris Yeltsin, who often suddenly changed course after encountering resistance, was unable to do this. While Putin managed to carry out the long-predicted and long-expected change in the personnel policy “silently, all at once, and completely calmly”; in full accordance with the new Kremlin style, there had been no information leaks at all. “Weak presidents do not act like this.”

Vek considers the appointment of Gryzlov no less indicative: “Putin is obviously willing to bring in new people, whom he himself has noticed and evaluated “. Like Ivanov, Gryzlov is Putin’s first candidate for a key position. Vek concludes: this indeed looks that the president has started realizing the long-cherished plans for personnel changes.

Kommersant-Vlast magazine says: “Putin hopes to transfer the center for ruling the state not even to the government but to the people he trusts.”

The magazine does not doubt that the president is not simply imitating “dramatic” action in order to mark his first “anniversary”, and not simply creating an illusion of “demilitarizing the ministries”. Since unlike the previous president, President Vladimir Putin is “able to put in a full working day”, he can afford to hold all the levers of power in his own hands. This would mean creating an entirely new mechanism of government. However, Kommersant-Vlast also notes that nobody knows “how the president plans to use that mechanism”. All the Russian media have been seeking an answer to this question for over a year.

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