THE WEEK OF KASIANOV’S SECOND ANNIVERSARY AS PRIME MINISTER

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The “Vremya Novostei” paper called the decision of the Russian government to lift all restrictions on oil exports (introduced on January 1 at OPEC’s request) an “Oil gift for George Bush”. The paper stressed that over this period OPEC countries have violated their own restrictions several times: according to April results, they exceeded their own quotas by 1.2 barrels a day. At the same time Russia that reduced oil extraction by 150,000 barrels a day under OPEC’s pressure, has kept all its promises. However, this concerns only Transneft’s supplies, as the state controls its pipelines.

Until recently, the restrictions were to be observed until July 1. However, on Friday Prime Minister Mikhail Kasianov met with leaders of Russian largest oil companies and it was decided to immediately restore full volume of oil exports. As an anonymous employee of the presidential administration explained to “Vedomosti” paper, “all necessary conditions have formed for canceling export restrictions: oil prices are good enough for Russia, the world economies, first of all the US economy is rising, and domestic oil storages are overloaded.” However, the main factor is foreign policy, “The US is concerned about growing oil prices and it does not try to conceal it.”

“Vremya Novostei” explains in turn, “The US is very discontented with high oil prices, which interfere with restoration of the national economic growth rate; that is why any actions of exporters that mean to reduce oil prices are extremely favorable for the US.” Moreover, according to the paper, in Russia oil exports are growing by the hour. According to some forecasts, this year oil extraction in Russia is to achieve 370 million tons. So far the government decided to restore prior 150,000 barrels a day that were reduced earlier; however, judging by everything, exporters will not stop at this level and oil extraction increase may be much more considerable.

The government in turn is extremely concerned that cancellation of restrictions and increase of oil exports may cause growth of oil prices on the domestic market. According to “Vremya Novostei”, the Energy Ministry is currently discussing possibility of considerable increase of export duties on cheap diesel fuel for agriculture. At the meeting with the prime minister, oil companies insisted on legislative stipulation of duties in order to secure against all kinds of surprises. However, the paper informs, “prime minister said this issue is to be resolved without fixed legislative norms”. Last week, Russian central press noted the skill of the head of the government to maintain freedom of actions and independence of judgments in any situation. The discussion was caused by notorious speech of Prime Minister in the Duma.

As an observer of “Vremya MN” Andrei Kolesnikov noted, at the background of resumed rumor on possible changes in the cabinet of ministers, including the position of prime minister, Kasianov “in fact started a politically suicidal polemics with the head of the state.”

In his Duma speech the prime minister unexpectedly responded to presidential reproaches of “lack of ambitiousness” in the government. Kasianov stated that high economic growth rate is to be achieved only in distant future, so far “no breakups are to take place”. Sources of rapid and high economic growth on the basis of oil exports have exhausted; now the country is to have “slow but qualitative structural economic growth”. Consequently, the government will have to take “structural measures and adequate monetary and credit policy”.

Andrei Kolesnikov noted, that it is clear for aware people that the prime minister is disputing not with head of the state, but with his economic aid Andrei Illarionov. “However, public politics has to deal with surface factors, and it was the president who appealed to ambitiousness and presentation of new forecasts.” The prime minister on the contrary considers ambitiousness to be dangerous, as it may be too much for weak Russian economy.

On the whole, Kolesnikov writes, despite all disturbing rumor, Kasianov “acts as master of the situation, continues his work, makes plans for the future, and in fact, says correct things that are hard to dispute.”

Moreover, economic results of first two years of Kasianov’s being the prime minister seem to be rather favorable for him. Recently, the “Vedomosti” paper reported that according to the Central Bank of the Russian Federation, gold currency reserves of Russia amounted to record $40 million, “It is maximum amount over the past decade.”

The paper writes that favorable oil situation on the world market makes it possible to forecast that by the end of the year this reserve will have totaled minimum $45 billion, “The amount that former Central Bank chair Viktor Gerashchenko believed to be necessary for providing a stable ruble rate and foreign debt repayment.”

However, the record reserve growth is caused by same oil exports, not by the government’s efforts. But Mikhail Kasianov said about it in his speech to Duma deputies.

Meanwhile, the “Izvestia” paper counted thirty achievements over the two year term of prime minister’s service. Among them are a 15% GDP growth and a 27% investment growth, as well as an almost 30% decrease of the number of people, whose income does not exceed minimum of subsistence and decrease of foreign debt by $22 billion and so on. However, all these achievement are followed by skeptical comments, the gist of which is that the cabinet of ministers does not put enough effort, and it all is due to favorable oil prices only.

In any case, these data makes it possible to understand the position of the prime minister, who has many times mentioned stable macroeconomics as the main achievement of the cabinet of ministers. According to “Izvestia”, Kasianov does not intend to sacrifice it “for the sake of good figures and beautiful but distant future”, as “he will have to account for excessive ambitiousness”.

Observer of the “Gazeta” periodical and journalists of the Radio Liberty Vitaly Portnikov called Mikhail Kasianov’s government the “cabinet of balance”. Portnikov writes, “The secret of stability of the cabinet is not the oil dollar shower but the correlation of political forces that formed in Russia right after Vladimir Putin came to power.” In the opinion of Portnikov, today there are three actual rulers in the country, “Alexander Voloshin is in charge of the political bloc; Mikhail Kasianov is responsible for the economy; and Vladimir Putin, who is simultaneously the symbol of stability and hopes, runs the security bloc of the country.”

Such a layout is unique for Russia, nothing of the kind has happened over the past decade. In fact, this is the explanation for previous often and quick change of cabinet of ministers and the present incredible stability of Mikhail Kasianov. “If any of the opposing groupings grew stronger, it would immediately allowed “its government” to enjoy high oil prices.” However, so far the political balance is maintained which “guarantees to Kasianov’s government an unprecedented in the latest history independence.” Besides, Vitaly Portnikov reminds, the time until the next presidential and parliamentary elections is already being counted, “It is extremely dangerous to break the balance at this period.” Over the two years of being the prime minister, Kasianov has turned from a “person serving the Kremlin into a serious political figure,” says “Nezavisimaya Gazeta”.

Moreover, according to the paper, judging by everything, the head of the government estimates his independence very highly: it is no accident he has in fact started an open conflict with the Kremlin. From the standpoint of “Nezavisimaya Gazeta”, the concealed part of the conflict is much more serious than what can be seen on the surface. “Over the past two years the trend for strengthening of the role of security departments in the economy of the country has become very obvious, which seems to bother the prime minister much more than possible presidential scolding,” says the paper.

Besides, “Nezavisimaya Gazeta” states, the prime minister definitely realizes that a sharp industrial growth can only result from constraining the economy. In these terms, the security grouping will inevitably acquire the leading role. While, as is known from history, violence always ends in an explosion. There is every reason to believe that economic breakthroughs carried out by security forces are highly likely to end in a “big bound”, similar to Chinese leap of the 1950s, and in a “cultural revolution” of 1960s pattern.

Undoubtedly, the paper notes, the Chinese economy benefited by it, but Chinese citizens had to live in a half-military state, as democracy is out of the question under such conditions. According to “Nezavisimaya Gazeta”, the only comfort is that “Russia is different from China and it has not raised its Great Helmsman as yet.”

From the viewpoint of the “Kommersant-Vlast” magazine, the sincerity of prime minister in the Duma first of all proves his self-confidence, “Kasianov has good nerve, he is not the one to start a psychic attack in order to defend himself.” If he started speaking, it means he is convinced of his victory, “At least in terms of keeping his position.”

According to the magazine, an additional sing of Kasianov’s victory is the failure of recent forecasts on Alexander Voloshin’s dismissal, especially if take into account that “Not irresponsible “sources” forecast it, but tycoons, who have necessary, many times proved contacts and who are perfectly aware of the Kremlin behind-the-curtain events.”

Despite everything, Voloshin is still in his chair, and “Vlast” believes this is “a true sing that the storm of the positions of the present team in power has been repulsed.”

However, all the aforementioned does not mean Kasianov is to have a cloudless future as he for the first time showed himself as a serious politician, “the president will inevitably notice political activity of the president and will come to his own conclusions on this point.”

So far, the “Vremya Novostei” paper summed up the result of present phase of polemics on the fate of the governmental head. The paper referred to the data received from top-ranking employees of the presidential administration and stated that president’s tough criticism of the government for insufficient economic growth rate is regular for their work. “In fact, the president has a full consensus with the prime minister – they both realize that it is impossible to increase the growth rates by times, although it is necessary to aim at it and do not allow the cabinet of ministers to relax.”

On the other hand, another source from the same circle explained to the paper, that dismissal of the government is a powerful political resource that should not be used in vain. It makes sense to use it only when serious political issues are being resolved, like in 1999 or in the situation of a difficult crisis like in 1998. Currently, it is not time to do so.

Moreover, it is out of the question on the threshold of the US President George Bush’s visit to Moscow: lately all politicians, political scientists, and the media were involved in an interesting discussion, “What should with agree with America on?”

This question was a subtitle of Yabloko leader Grigory Yavlinsky’s large article which was published in the “Obshchaya Gazeta” paper. From the standpoint of Yavlinsky, only “polite cooperation in NATO format” or agreement on armament issues are not enough. “Disparmament politics is senseless in the present situation as a foreign policy concept,” the Yabloko leader writes, “It is rational but technical issue.” If the result of negotiations is only agreements of this kind plus cancellation of the Jackson-Vanik amendment, plus general declarations, it will mean that the potential Russia received after September 11 events has not been used.

Since September 11, Russia has been “very clearly signaling” to the West, in particular, by means of withdrawing Russian military bases from Cuba and Vietnam, calm reaction at US withdrawal from the ABM Treaty, agreement on presence of the US military not only in the Central Asia but also in Georgia and many other.

“All these signals contradict to the position and opinion of almost the whole presidential surrounding – many officials, the Foreign Ministry, the military, politicians,” the Yabloko leader stresses, “And it is definitely a hand the Russian president stretched to the Western world.”

Russia does not need a partnership agreement with the West, “The matter in question is a joint declaration on common concept of freedom, democracy, human rights, general priorities and threats, as well as on mutual security guarantees in case of a terrorist or military aggression.”

According to Yavlinsky, an alliance between Russia and the west is profitable for both sides in the present global reality. For Russia this alliance may become a “factor for establishment of a real democracy.” Moreover, the author believes, it is probably the only way to normally complete Russian reforms, “which have been carried for a decade so that seem to have finally exhausted the reforming energy of the Russian people.”

Meanwhile, Yavlinsky stresses, just like before, the West accepts Russia as a country from a different world, “Depending on the situation it may be friendly or hostile, but it is always alien.”

The Yabloko leader thinks the West “has never believed in our country and put a stake only on the ruling grouping.” It has always been interested in a “strong hand”, which would be able to control the situation in the country.

Although the lack of democracy in Russia’s interior life always causes reasons for mistrust, there is no time to wait for it to meet Western standards. The Russian “double standard” – present discrepancy between domestic and foreign policy – cannot last long. Either domestic policy is to be brought into compliance with the foreign policy agenda for converging with democratic western countries, or this agenda itself will turn out to be a “deviation to be corrected”. If the latter is true, Yavlinsky writes, “the usual and logical for authoritarianism armored train will again become the symbol of foreign policy.”

According to Grigory Yavlinsky, the uncertainty whether the partnership agreement is to be concluded forces the Russian president “not to burn bridges and to preserve the present surrounding as a possibility for retrieving”. If Putin’s “western project” fails, Russia will have “few prospects: the peculiarities of Russian interior politics clearly demonstrate where the authorities will retrieve if they fail to become west’s allies.”

The “Izvestia” paper suggested a standpoint from the opposite side in the interview with famous US political scientist Michael McFal, who is considered to be not only a most well-known expert on Russia in the US, but also a major consultant of George Bush on Russia.

According to McFal, Putin’s foreign policy initiatives prove that “he is a very competent person”, even if his initiatives do not meet US interests. The economic policy of the Russian president does not rise any questions as well. The only issue is the democratization process in Russia.

Michael McFall says, “It seems to me that Putin does not realize well that criticism of the power is a good aid for the power.” The president still misunderstands this, when 70% of the population support him. What will happen if this number falls to 30%? “Then, some aid may whisper to the president: why do we need elections? We have Interior Ministry, the Federal Security Service, military support, regional governors….”

Of course, Mr. McFall reserves, it is hardly likely to happen, but still…. “At present Russia is much closer to democratic standards than ten years ago. But it has not approached them finally yet.”

Boris Berezovsky also discussed threats that endanger Russia in his interview with the “Novaya Gazeta” paper.

As was expected, Boris Berezovsky is little concerned of support of reforms by the population, “Because not the population, but a thousand of people make politics in Russia.” The main instrument for influencing politics is their money.

On the other hand, Berezovsky admits that he made a system mistake in the course of “making politics”, “I believed the main force that opposes reforms is the communists, however, it is the Federal Security Service, or to be more precise the Soviet KGB.”

According to the exiled tycoon, breakup of KBG into many competing departments in fact changed nothing. At present that main obstacle to reforms is “KGB instincts” of the president and his aspiration for authoritarianism.

However, according to Berezovsky, these attempts are doomed to fail – and not because liberal politicians or public opinion will object to it. “It is not enough to suppress the Federation Council, the parliament, and television in order to establish an authoritarian society, where people would not object to any actions. It is necessary to redistribute properties.”

Has anyone though, why in 1917 property redistribution caused a civil war, while in 1990s nothing like this happened? Berezovsky explains: it is because in 1917 communists took properties from concrete people, while in the 1990s they were taken from the state. “So, this time, he will have to take properties from concrete people, and this is impossible to do without much blood.”

At the same time, Berezovsky added, the issue of the present president is not only his aspiration for authoritarianism, but his lack of authoritarianism, “Putin did not understand that it is impossible to be only half-authoritarian. If you threaten, you should fulfill your threats, otherwise no one will be afraid of you.”

As aforementioned Michael McFall states, US President George Bush is not concerned in the least about Putin’s KGB past. “He does not have to carry the Cold War luggage along – at that time he did not participate in politics at all,” explains the US expert on Russia, “He was busy with other things, say he played baseball, and I do not think he had ever had to meet a Soviet leader.”

That is why he does not have stereotypes concerning President Putin. According to the “Guardian” paper, in his close surrounding, he calls the Russian president Pootie-Poot. “Guardian” reports that George Bush has had passion for all sorts of nicknames since his school years. Moreover, he is convinced that this peculiarity of his has always allowed him to make new friends.

Then “Guardian” writes that Putin in turn made great efforts to earn the friendly nickname. While preparing for the first summit in Lyublyana, he absorbed lots of information on Bush and all that is connected with him.

It should be noted that his professional studies were rewarded – as is known, after meeting in Lyublyana Bush stated, “I looked into his eyes. I managed to feel the soul of this man.”

However, from the standpoint of “Guardian”, “Pootie-Poot” is more likely to be “retrieval for Bush’s senior kindergarten language, who is know for his phrases like, “I’m in a big turd”. The “Kommersant” paper published translation of the article in the “No comment” column.

However, other periodicals commented on Bush’s word creation. For instance, “Gazeta.ru” thinks that Pootie-Poot resembles “Lilliputian”. Can it be a hint at the height of the Russian president? In response, “Gazeta.ru” called Bush Jorgie.

Leonid Bershidsky, editor-in-chief of the “Vedomosty” paper thinks that the slang meaning of the word “buche” can also be taken into account. “Americans will not get offended, it is too long to explain this pun in English.”

On the other hand, Bershidsky reflects, Putin with his peculiar St. Petersburg politeness should not pay Bush back in his own coin, “Otherwise all would think the American offended him.”

Besides, there are other signs of sympathy, beside friendly nicknames. The “Dengi” magazine published a rumor which says that on the threshold of the summit the US administration discussed something resembling a Marshall plan for Russia. They say, the issue in question is a ten-year $70-80 billion investment program. However, the magazine made a reservation, “It is hard to believe, especially if take into consideration that currently the US economy is having difficult time itself.” On the other hand, Russia has already contributed to the new stage of US prosperity having canceled oil exports quotas.

So, will friends be friends?

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