Publication: Monitor Volume: 5 Issue: 99

Boris Berezovsky’s apparent victories in the battle for control over the new cabinet reportedly come at the expense of a rival group headed by privatization architect Anatoly Chubais, who currently heads United Energy System (UES), Russia’s electricity grid. Both Prime Minister Sergei Stepashin and the man he wants to name economics tsar, Duma budget committee chief Aleksandr Zhukov, are said to be close to the Chubais camp.

Izvestia, a newspaper with sympathies clearly toward Chubais and his allies, today seemed to hold out some hope that the balance of power could be reversed, but warned of the consequences of failure. “If Stepashin does not manage to maintain a maximally tough position, the degree of his influence will be severely limited by the Kremlin. Boris Berezovsky, together with the ‘family’ as a whole, will have restored their influence completely. One might ask, what was being fought for in removing Primakov, who at least neutralized Boris Abramovich [Berezovsky] for a while? And if Berezovsky regains his former might, it will be impossible to regard [Stepashin] as a full-fledged premier” (Izvestia, May 21).

Meanwhile, Yegor Gaidar–the former acting prime minister who heads the center-right coalition Pravoe Delo (Right Cause), along with Chubais, Boris Nemtsov, Boris Federov and others–made remarks yesterday which could be interpreted as an admission of defeat at the hands of Berezovsky and his allies. Gaidar told a meeting of his own political party, Russia’s Democratic Choice, that it was “hopeless” to expect reforms from the Stepashin government, which he said was “in some ways a caretaker government.”

Commenting on Aksenenko, Gaidar said: “He built up the railways very well in terms of control of financial flows, discipline and so on. The problem is that those measures and those managers, who are very qualified in a centralized system… are absolutely unacceptable, are life-threatening for running a market economy as a whole. We’ll see how capable he is of understanding that” (Reuters, May 21). Gaidar’s comments would seem to suggest that he expects Aksenenko to be in overall charge of economic policy.

One account suggested today that Chubais might now “build on his success and encroach on the others’ estates–to fight for control of Gazprom [Russia’s natural gas monopoly] and United Energy Systems.” Berezovsky, the account maintained, depends completely on the presidential inner circle maintaining his power and thus might “look for the most exotic variants for extending Yeltsin’s power–for instance, by postponing the presidential elections in connection with a union between Russia and Belarus.” This would be supported by “a majority of the oligarchs” (Kommersant, May 21).