Publication: Monitor Volume: 8 Issue: 86

Yesterday’s traditional May Day rallies in Moscow passed off peacefully. There were two separate rallies in the Russian capital, one led by the Communist Party of the Russian Federation (KPRF) the other by the Federation of Independent Trade Unions (FNPR) in conjunction with United Russia, the “centrist” party recently formed as the result of a merger between Fatherland-All Russia (OVR) and Unity.

The Communist-led rally, which, as in previous years, took place near the capital’s Revolution Square metro station and the Bolshoi Theatre, numbered 9,000 to 20,000, according to various estimates. The mainly elderly leftist demonstrators heard KPRF leader Gennady Zyuganov denounce the government’s economic policies, claiming that Russia was becoming “more and more subordinated to American capital,” its “system of administration” was being degraded and that “mass internal dissatisfaction” was on the rise. But while the KPRF vowed earlier this month that it would mount a “tough opposition” against President Vladimir Putin and the government after the pro-Kremlin factions in the State Duma kicked the party out of its key committee chairmanships in the parliament’s lower house, criticism at yesterday’s KPRF rally was aimed primarily at Prime Minister Mikhail Kasyanov’s cabinet, not at President Putin himself (NTVru.com, RTR-vesti.ru, May 1).

Interestingly, similar criticism of the Kasyanov cabinet was voiced yesterday at the trade union-led rally, which took place on Red Square–the first such May Day demonstration there in ten years–and drew a crowd estimated at 140,000. The event was perhaps even less spontaneous than the KPRF-sponsored one taking place nearby. The FNPR is, at least according to its name, ostensibly made up of independent trade unions, but in fact is the successor to the Soviet-era trade union structures and thus remains under de facto Kremlin control. All this makes more interesting the fact that its head, Mikhail Shmakov, yesterday for the first time openly called for the dismissal of the Kasyanov cabinet’s “economic bloc,” including Finance Minister Aleksei Kudrin and Trade and Economic Development Minister German Gref.

Perhaps even more intriguing is the fact that many of the United Russia contingent in yesterday’s rally, while overtly pro-Putin (carrying placards reading “Our president: Vladimir Putin” and holding aloft portraits of the head of state), also denounced the Kasyanov cabinet. Some United Russia members carried placards reading “Kasyanov and Gref, wake up, freeze” and “Chubais, don’t play with electricity, you’re already a big boy,” both apparently referring to the government’s plan to allow state-controlled monopolies like UES, the national electricity grid headed by Anatoly Chubais, to raise tariffs. Those price hikes, in fact, have already begun: Electricity rates for home consumers in Moscow, for example, went up 20 percent as of May 1. Others among the United Russia demonstrators denounced Gref’s planned reform of housing subsidies and Labor Minister Aleksandr Pochinok for introducing a single social tax, while still others denounced wage arrears to state employees while demanding pay increases for policemen and an end to the “bespredel” (a Russian word connoting limitless power and total license) of state bureaucrats (RTR-vesti.ru, NTVru.com, Radio Ekho Moskvy, AP, AFP, May 1).

This criticism of the cabinet by Kremlin-controlled organizations suggests that Putin may be preparing to make key members of the Kasyanov cabinet, along with traditional hate figures like Chubais, the scapegoats for any popular backlash against painful reforms such as the reform of housing subsidies and raised tariffs for electricity and natural gas. Putin would have even more reason to sacrifice cabinet members, up to and including the prime minister, given that economic growth has been slowing over the last two years and that the cabinet recently produced a four-year economic development plan whose growth projections were, in the president’s view, too modest. Putin publicly upbraided the cabinet for this and in his annual State of the Nation speech last month put forward a rather gloomy view of Russia’s economic future while attacking the state apparatus for corruption and inefficiency (see Russia’s Week, April 10, 17, 24; Monitor, Fortnight in Review, April 19).

Indeed, given the economy’s tepid performance, the demand for a Keynesian stimulus through active government intervention appears to be growing. Moscow Mayor Yury Luzhkov, a leader of United Russia and a participant in yesterday’s rally, warned the cabinet that its economic policy was in danger of failure unless it takes steps to support “the real sector of the economy through improving the lives of the people, through raising [their] purchasing power” (RTR-vesti.ru, May 1). Worse still for the cabinet is the fact that it is under criticism not only from the left–meaning the FNPR and United Russia, not to mention the KPRF, which millions of Russians still support despite its dwindling political fortunes–but also from the right. Andrei Illarionov has criticized the government’s plans to allow natural monopolies like UES and Gazprom to raise tariffs, warning that such price rises could act as a brake on growth and spark inflation (Moscow Times, April 8, March 5). For her part, Irina Khakamada, a leader of the Union of Right-Wing Forces (SPS), yesterday criticized the cabinet’s “economic bloc” for “freezing social reform” by blocking such initiatives as the creation of private social insurance that would be equal in status to the state’s social insurance. Asked by an interviewer yesterday what slogan she would put on a placard were she marching in the May Day demonstration, Khakamada answered: “Down with the government! Let the president take all the responsibility on himself!” (Radio Ekho Moskvy, May 1).