Publication: Prism Volume: 7 Issue: 7

By Elena Dikun

On an official visit to Salzburg in early July, Russia’s prime minister drew a line under discussions on reshaping the cabinet. Mikhail Kasyanov announced that there was no point looking out for any structural or personnel changes in the government in the near future. Prior to this he had been repeating the mantra that a “fine tuning of the government” was imminent, and kept asking the president for another week or two’s grace to hammer out the details of the project. So what happened? Why the sudden radical change in the tone of the prime minister’s comments?


We should not forget that Kasyanov’s directive to restructure the cabinet came from above. At the end of last year Putin asked him to come up with an appropriate plan. Kasyanov, however, had had no intention of changing anything in his fiefdom, which was only just finding its feet. But directives from the president are not open to debate. Kasyanov submitted regular progress reports to Putin on how his instructions were being carried out, attaching to each report a sheaf of plans and schemes concocted in the White House. After prolonged consultations Kasyanov presented his conclusions: Halve the number of ministries and departments by merging and enlarging them; lighten the burden on the vice premiers, who should number two or three; and raise the status and role of ordinary ministers by clarifying their areas of responsibility. Yet the clearer the outlines of the project became, the less enthusiastic Putin was about it.

What was it that disappointed Putin–whose idea it originally was? The word is that, having waded through the mounds of paperwork, he was convinced that even if all the proposed changes were made, the government was unlikely to start functioning any better. Moreover, ministers themselves were frequently petitioning the Kremlin, as though admitting that they were not yet ready to take full responsibility, that they still had a great deal to learn. When the president’s staff sat down and worked out who could be appointed to which super-ministries, they came to a very sad conclusion. It transpired that finding twelve or fifteen efficient managers capable of running their departments was a very tall order. Even those who even quite recently had shown great promise failed the endurance test. For example, early last year Communications Minister Leonid Reiman figured among those being considered for the post of prime minister, but today he is struggling to keep his own job. In the last eighteen months he has distinguished himself in a series of scandals related to the monopolization of the mobile telecommunications market. Another prospective high-flyer from St. Petersburg to fall by the wayside is Vice Premier Ilya Klebanov, who instead of bolstering the military industrial complex became suspiciously closely involved in lobbying the interests of domestic automobile and aircraft manufacturers. In the fall Klebanov will probably be given a job closer to his new area of interest. To sum up, the team inspection revealed that the substitute’s bench was still pretty empty.

Thus the only question still on the agenda is whether Economic Development Minister German Gref will manage to shift Finance Minister Aleksei Kudrin and take over his job of vice premier. The received wisdom in the corridors of power is that Kudrin is incapable even of administrating his own department: Chaos reigns, papers marked with the president’s instructions are passed around endlessly from office to office, and the minister himself gets confused about his multitudinous deputies (there are fourteen of them altogether–three first deputies and eleven ordinary ones). One tale doing the rounds in the Kremlin tells how the office manager burst into Kudrin’s reception room demanding to be seen immediately. He had to check what color tiles the ministry cafeteria should have. He was shown in ahead of everyone in line. Naturally, such criticisms serve to reduce Kudrin’s standing, but he does possess a powerful trump card. He is held in great esteem by the president, who appreciates his analytical mind and his phenomenal memory, and who telephones him several times a day to check this or that figure.

However, Gref is equally valuable to the president. Recently, Gref and Kudrin joined forces against Kasyanov, but recently their paths have tended to diverge. Gref has unexpectedly patched things up with Kasyanov. It is said that the prime minister has promised to appoint the economic development minister as his deputy. White House veterans, however, think that Gref is merely being offered some bait. In fact, nobody is planning to change anything, and Kudrin will still be vice premier for the time being. The expectation is that having had his hopes raised, Gref will take offense and redouble his efforts to secure the coveted position. Under these circumstances Kudrin and Gref will inevitably turn to the president, who will adopt his usual role of arbitrator and will encourage both ministers to try and achieve great things. Kasyanov is also happy with this scenario–Gref may completely undermine Kudrin, whom the prime minister has always eyed with unconcealed jealousy, seeing him as a potential rival.

One member of the St. Petersburg team has described the reorganization of the government–which resulted in a mundane reshuffle of junior ministers (those being laid off may be joined by Nationalities Minister Yevgeny Blokhin and Science and Technology Minister Aleksandr Dondukov)–as “appeasing the swamp.”


According to our sources, however, Putin has not rejected the idea of a shake-up; he has simply shifted the emphasis. He now believes that the crucial thing is to push as many liberal economic laws and the Land, Labor and Criminal Codes through the Duma as possible to lay the legal groundwork for his future reforms. He and the new power elite around him understand that, although for the last ten years Russian business has operated in the new realities, within the framework of the old legislation these realities are totally illegal. Kasyanov’s government has established a good dialog with legislators, and is coping with its historic mission to push the required liberal economic laws through parliament, so there is no need to interfere with it up unnecessarily. But it is another government that will have to put these laws into practice.

To all appearances, the president will dismiss Kasyanov’s cabinet in the spring of 2002. It is easy enough to work out why. At the end of 2001 the government will have to adopt the budget for next year, and then answer to the public for the traditional problems of the fall and winter in Russia. The president wants to give the new government a chance to make a fresh start. The radical liberal economists, who are enthusiastic and raring to go, will be recruited to head up the Mark Two government. The president is prepared to second his economic advisor Andrei Illarionov to the White House; as vice premier he will be the driving force for reform. In other words, he will assume the role Anatoly Chubais performed under Chernomyrdin. In two years, from 2002 to 2003, this kamikaze team will have to push through unpopular, tough reforms, and then retire. By the end of 2003 the president will need a centrist, placatory cabinet. The plan is for a stabilizing government to carry Putin to victory in the presidential elections. One potential prime minister for this government is Sergei Stepashin; Vladimir Putin–who is known to have a long memory–is grateful to Stepashin for his loyalty after Putin was appointed to replace him.

Elena Dikun is a political columnist for Obshchaya Gazeta.