The ‘Magician,’ the ‘Mace’ and the Russian Defense Industry (Part One): The Magician Practices His Trade

During the crisis of defense reform associated with Anatoly Serdyukov’s (Russian minister of defense in 2007–2012) so-called “New Look” approach, there appeared a defense expert armed with mighty tools to unmask corruption and incompetence within the defense ministry and to lead Russian defense industries back to the position they had enjoyed during the Soviet era. This hero was Dmitry Rogozin, the son of a defense specialist in aviation technology, a prominent political figure of the Boris Yeltsin era and a member of the State Duma, as well as the Russian plenipotentiary ambassador to the North Atlantic Treaty Organization (NATO) in Brussels.

In early 2008, then-president Vladimir Putin appointed Rogozin Russia’s Extraordinary and Plenipotentiary Ambassador to NATO, a post he held until December 2011. While at NATO, Rogozin also served as special representative to NATO for negotiations on ballistic missile defense (BMD). Failing to find any common ground for agreement on BMD, Rogozin proposed that NATO and Russia cooperate on protecting the earth from stray asteroids. In December 2011, Dmitry Medvedev, then president of Russia, named Rogozin deputy prime minister and put him in charge of Russia’s military-industrial complex. The appointment paralleled a time of crisis for defense reform and for the country’s defense industry.

Rogozin emerged as one of the most vehement critics of Serdyukov’s “New Look,” which he blamed for most problems in the defense sector. Rogozin contended that Serdyukov and his “women’s battalion” (high-level staffers who came over to the Ministry of Defense with him from the Russian tax ministry) were guilty of corruption on a massive scale. They had undermined Russian defense contractors by buying foreign technology and radically cutting the number of military representatives at Russian defense industries. Rogozin promised to put the defense industry back on a solid national path. The Ministry of Defense had cut the number of its representatives to defense contractors from 25,000 to 7,500. The reduction had been part of a move to reduce the size of the officer corps and to ensure that those serving were performing military duties. However, in November 2012, Rogozin moved to increase the number of quality control inspectors (priemki) back to 25,000, saying that this would restore quality control in the production of domestically produced military weapons and systems. Priemki had worked in the Soviet system and should solve any contemporary problems, Rogozin, the Russian defense sector’s magician claimed. Others were not so sure. Russian analyst Andrei Rezchikov noted that the post-Soviet defense industry was based on defense enterprises intent on making a product for profit and that the recent cut in such inspectors had been based on the fact that many inspectors owed more loyalty to the firms, which provided their housing than to the Ministry of Defense (Vzgliad, November 21, 2012).

Rogozin attacked corruption in the defense ministry on many fronts but focused on the abuse of official positions for personal gain. Ironically, in the summer of 2012, the Russian press reported that Rogozin’s son, Aleksei, a 28-year-old member of the State Duma, had been appointed the executive director of the Aleksinsky Chemical Plant federal state enterprise, which would shift its production from a range of consumer goods “to gun-cotton powder and rubber products” connected with defense.  While critics questioned the plant’s ability to adapt to such production, Aleksandr Konovalov pointed to a special advantage the factory would enjoy: “When you have a dad who is deputy prime minister, it is very difficult to make the plant unprofitable—orders just end up there…”  Only a few months before his son’s appointment, Rogozin had attacked the quality of explosives provided by the Aleskinsky Chemical Plant to the Ministry of Defense as inferior. Only a few months later, the magician had found a solution, which kept the business in the family (Izvestiia, July 4, 2012).

When the launch of a huge Russian Proton-M rocket carrying two satellites failed in August 2012 because of the malfunction of its third stage, Rogozin was again there with his magic. While the press saw the latest failure as a sign of deep crisis in the Russian space industry, Rogozin said that a special briefing for Prime Minister Medvedev on the causes of the disaster would take place and would also address the future of Russia’s space industry. The leadership of the Russian space agency Roskosmos was put under a gun to deliver improvements in six months or face removal. Not everyone embraced the Stalinist slogan “cadre decide everything,” which proceeded a purge of said cadre. Others saw much deeper problems of quality control and organization going back several years that included failures in other launch vehicles, exemplified by another failure of a Proton-M in December 2012 (Novye Izvestiia, August 8, 2012). Less than a year later, another Proton-M rocket, this time carrying three GLONASS geo-positioning satellites, blew up shortly after launch from Baikonur Cosmodrome (see EDM, July 9). This time, Rogozin’s magic appeared even more distinctly Stalinist. Rogozin asked that vital first question before anything can really be done: “Whose fault is this?” Upon hearing that a young technical expert had apparently installed a data collector in upside down on the failed rocket, Rogozin dismissed the measures proposed by Roskosmos management to improve quality control as inadequate. “First, I see an ineffective management; second, excess capacity; and third, a foggy understanding of the goals of space activity.” His solution to the crisis in Russia’s space industry was to merge it with the aviation industry. His second proposal was to find the “wreckers” who engaged in sabotage (Vesti.ru, August 5). Nothing came of Rogozin’s proposals.

Then Rogozin faced a crisis directly under his own supervision. The space launch center, known as Cosmodrome East, which was being built at Uglegorsk in Amur Oblast, was falling behind schedule. Rogozin flew out for an inspection and brought some more magic with him. Once again he focused on the “human factor” and warned: “I will view any deviation from the plan as sabotage. I have no intention of being one of those public servants who accept failure to deliver on instructions” (RIA Novosti, August 21). A day later Rogozin offered his own technological solution to oversight: the placement of video cameras so that he could closely monitor the construction of the cosmodrome and, in this manner, play the role of a super “inspector general.” Some questioned how exactly the digital video recorder would help with the corruption associated with construction contracts, especially defense construction contracts going through the Federal Agency for Special Construction (Spetsstroy), which, in 2011 had been put under the control of Deputy Defense Minister Grigorii Naginsky, replacing a senior military officer who held that post for over a decade. Naginsky was seen by many as one of Serdyukov’s team with connections to Oboronservis—the defense ministry–controlled holding company, which was the focus of a massive corruption scandal implicating the former Russian defense minister and officially leading to his sacking (see EDM, October 25, 2012). Naginsky was also closely tied to the private corporation Titan-2 Story Holding, in which his wife and daughter had considerable stock and which had construction contracts with the Russian military’s Strategic Rocket Forces (Ekho Moskvy, August 22). None of Rogozin’s suggestions addressed these systemic cases of corruption and conflicts of interest.