Yeltsin introduced the refoms that paved the way for Putin’s increased power and influence. Photo: www.ne.se/vladimir-putin.

Reviews The legacy of shock therapy. Russian liberalism in the political wilderness

Published in the printed edition of Baltic Worlds pages 38-39, Vol III:1, 2010
Published on balticworlds.com on mars 24, 2010

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Michail Kasianov was Vladimir Putin’s first prime minister, serving between 2000 and 2004. In Russia, he was generally viewed as a compromise head of government, appointed by the former president Boris Yeltsin’s family to supervise the new leader, Vladimir Putin. According to this popular belief, Kasianov’s main mission was to guarantee the interests of the oligarchic groups that emerged during Yeltsin’s reign. In 2004, when Putin became a powerful political leader, Kasianov and his government were finally dismissed. Putin appointed his own men to the most important positions in the Russian administration. Shortly thereafter, to the surprise of many, Kasianov placed himself in opposition to Putin, making an abortive attempt to challenge Putin’s presidential candidate Dmitry Medvedev during the 2008 presidential elections. In fact, he never even gained permission to register as a presidential candidate.

Despite the author’s former high-ranking position, the book would probably have been of limited interests if it  had only consisted of conventional memoirs. Kasianov represents the rather typical Russian bureaucrat, mundane and uninspiring — although he has always given the impression of being a cautious and skilful courtier and politician, qualities of use to him in a successful career. Kasianov has never emerged as a controversial or passionate oppositional politician who appealed to the broad masses. What makes this book special is that it is written in the form of interviews with Yevgeny Kiselyov. Kiselyov was a leading Russian political journalist during the Yeltsin era, the “face” of the Russian TV channel NTV that was, in turn, controlled by one of the oligarchs, Vladimir Gusinsky. However, Kiselyov is much more than a famous journalist. His influence on the political processes of the 1990s and, later, his uncompromising critique of Putin have made him into one of the symbols of Russian liberalism. Not surprisingly, after Putin’s succession as president, Kiselyov lost his job and disappeared from Russian TV. He currently works as an anchor for several popular political programs on Ukrainian TV.

Kasianov’s memories of the 1990s constitute the most informative part of the book. The reader becomes familiar with aspects of this dramatic period in Russian political history that were previously unknown. Kasianov informs us, for the first time, of how German chancellor Helmut Kohl and French president Jacques Chirac helped Yeltsin survive politically when, just before the 1996 presidential elections, he needed money to pay wages and pensions in his economically ruined country. At this point, Yeltsin’s rating was as low as 2 percent. The loans to Yeltsin’s government, which came to about 5 billion dollars, were a decisive factor in Yeltsin’s electoral victory. Kasianov, then deputy finance minister, was involved in negotiating these loans and was, subsequently, greatly favored by Yeltsin.

Kasianov also gives us a good deal of information about the Russian financial crisis and default of 1998 that ended Yeltsin’s political career. According to Kasianov, the announcement of a default was, in fact, unnecessary. The government could have either paid or restructured its debts. The default was a deliberate political decision, made by a small number of high-positioned Russian government officials. Who were these persons and why did they reach this decision? These questions are never explicitly answered.

Kasianov is reserved in discussing his time as prime minister under president Putin. Here, Kiselyov’s text and questions are far more interesting and provocative. Kiselyov’s background in the Russian security services in the 1980s (he then taught Persian at the KGB’s higher school) has given him considerable insights into how the Russian political kitchen has functioned after 2000, during Putin’s reign. He thus poses questions based on a multitude of rumors, speculations, and different versions of important political events. Because Russian politics depend more heavily on the activities of influential individuals at the center of power than on the functions of independent institutions, this information is of considerable value. Kasianov definitely rejects the rumor that he owed his appointment as Putin’s prime minister to the influence of the Yeltsin family. Nevertheless, Kasianov’s own version, that his advancement was entirely due to his professional qualities, is not entirely convincing. The book includes pictures taken at Kasianov’s private parties, pictures which show, among the guests, several Yeltsin oligarchs — such as Roman Abramowich, Alexander Mamut — and, not least, Yeltsin’s daughter Tatyana Yumasheva.

Kasianov’s description of how Putin concentrated power into his own hands in the early 2000s is quite credible, but does not add much that is new to the picture. The exception is his account of the events surrounding the 2003 Yukos affair. Kasianov contends that some months before the arrest of the Yukos owner Michail Khodorkovsky, the latter, with the support of leading oligarchs, had presented Putin with a plan meant to legalize the outcome of the Russian privatization of the 1990s. This was to be institutionalized in the form of a special law. In exchange, the most prominent oligarchs were to make one-time payments into a special state-owned fund to finance public expenditures on Russian infrastructure. It was hoped that this “one-time tax” would prevent a reversal of the privatization results and guarantee greater stability for the new post-Soviet business elite. However, Putin rejected this plan, since he wished to keep the leading Russian businessmen under his personal control.

According to Kasianov, Putin dismissed his government in 2004 because he could not tolerate Kasianov’s independence and professionalism in opposing Putin’s steering Russia towards an authoritarian regime. Putin supposedly feared a prime minister who was or could become a political rival. This statement is not completely reliable. Kasianov was not in a position to challenge Putin politically. Indeed, according to the Levada Center’s public opinion polls of 2000–2004, the policies of Kasianov’s government was always unpopular with the majority of the Russian electorate — in stark contrast to Putin’s growing popularity during those same years.

The last part of the book, devoted to Kasianov’s political activities as an oppositional politician, is rather boring and not to be trusted, with one important exception. Kasianov gives a good deal of information about his contacts with Yeltsin before his death in 2007. The former president expressed his disappointment with the policy followed by Putin on several occasions, complaining to Kasianov that Putin was reversing the democratic gains of the previous period. Yeltsin, who lived under constant surveillance, feared, Kasianov tells us, for the personal safety of his family should he make such criticism public.

It is still unclear why Kasianov rejected a number of offers, made by Putin after Kasianov’s dismissal in 2004, to assume important positions in the Russian administration, opting instead for a role in the opposition. Kasianov’s own explanation, that he was kept from serving in Putin’s government by his determination to safeguard the democratic values of the Russian people and oppose the concentration of power in the hands of Russian security services, as embodied by Putin, is hard to believe. The demolition of Yeltsin’s illusory “democracy” and the concentration of power had begun long before Kasianov’s dismissal in 2004 — it had been a continuous process, going on for years, yet Kasianov had not felt called upon to resign.

The title of the book is rather ambitious since it does not reflect the book’s contents; it is instead an indication of Russia’s political future, when Putin will no longer be a leader of his country. This is not as farfetched as it may seem at first glance. The current economic crisis, which has brought insecurity and a decrease in the standards of living to the majority of Russians, may lead to a rapid decline in the popularity of Putin as the “national leader” of Russia. According to the constitution, president Medvedev has the power to dismiss Putin’s government without notice or explanation, just as Putin dismissed the government of Kasianov. A group of influential liberal-minded experts at the Institute for Contemporary Development, founded under the auspices of president Medvedev, are openly discussing this alternative. These experts, who appear to be more or less active behind-the-scene politicians, share Kasianov and Kiselyov’s ideological convictions. If such a development were to take place, the result could be a chain of unpredictable political events that could completely change Russia’s political landscape. The liberal opposition to Putin will need a leader, one who is well-known to the Russian public and who is not compromised — as are the majority of the most influential liberals — by direct participation in the notorious privatizations of the 1990s. Under such conditions, Kasianov might be launched as the Russian liberal leader. This is the reason why this book was published towards the end of 2009, and not before, and also, probably, the reason why Kiselyov has participated in the project.

Reading the book evokes some reflections on the nature of Russian post-Soviet liberalism, or, to give it its proper name, neoliberalism. Russian liberals, for a short historical moment in the early 1990s, were leaders of the transformation of Russia from a state-led centralized society into a market economy. In this historical mission they failed. Russia’s liberal governments preferred “shock therapy” to gradual transition, and the highly controversial privatization of the huge state-owned enterprises led, eventually, to the whole economy falling into the hands of a few so-called oligarchs. A dramatic process, the equivalent of a civil war, followed as a result of the economic collapse in the late 1990s. Hundreds of thousands of Russian men killed themselves during the years of privatization and redistribution of what had been state property. Not surprisingly, this led to a greater acceptance of violence and the spread of criminality in Russian society, which in turn undermined the credibility of the institutions responsible for the stable development of the market economy. Most importantly, Russians still lack respect for private property, an indispensable condition for a well-working market economy. Such respect could not be fostered under “shock therapy” conditions, which means that privatization from the start was based on fraudulent schemes leading to the impoverishment of the majority of the Russian population.

The refusal of the liberal opposition to accept this failure will, probably, keep it from gaining power, at least through democratic means. Putin’s popularity among Russians is not only due to his concentration of power that includes his control of television and of election procedures. As the Levada Center’s public opinion polls show, the majority of Russians have a clear and disillusioned perception of Putin’s policies, both when it comes to the economy and in terms of the development of democratic institutions. Nonetheless, Putin has managed to present himself as an alternative to the “damned 90s” (Putin’s own expression). Memories of the 1990s are still fresh with a majority of the Russian citizens, as is the Russian liberals’ historical responsibility for the atrocities of the era. By praising the legacy of the Yeltsin period, Kasianov and Kiselyov are, in effect, defending the 1990s’ suppression of the political opposition, Yeltsin’s anti-constitutional coup in 1993, and that same year’s tank attack on the democratically elected parliament. More importantly, Yeltsin’s introduction of a new constitution created the very super-presidential power system that Putin was later to master so skillfully. Both Kasianov and Kiselyov, the former as a member of the government and the latter as an influential TV profile, personally contributed to Yeltsin’s re-election in 1996 — a re-election that ruled out the option of a democratic change of political power in Russia for a long time to come.

Whatever political and ideological values the authors of the book represent, Without Putin is full of interesting facts about and insights into political life in post-Soviet Russia. It is valuable reading for those interested in contemporary Russian politics and economics.

+ Michail Kasianov, Bez Putina: Politicheskiye dialogi s Yevgenyem Kiselyovym, [Without Putin: Political Dialogues with Yevgeny Kiselyov] Moscow: Novaya gazeta 2009, 320 pages