Strongman (10 page)

There was, perhaps, still a slim chance to survive. At around the same time, Malashenko received an offer directly from the Kremlin: fulfil certain conditions and the reprisals would stop. The
conditions, according to Shenderovich, were: to stop investigating corruption in the Kremlin, to change their coverage of Chechnya and, above all, to ‘remove the “First Person”
from
Kukly
’ – in other words, Putin’s latex physiognomy had to disappear from the show.

To Shenderovich, this was a red rag to a bull. He responded by writing a hilarious episode of
Kukly
that lampooned the edict itself. Since they could not show Putin, they showed a burning
bush instead. Moses – in the form of Putin’s chief of staff, Alexander Voloshin – receives tablets from his invisible leader with the Kremlin’s ‘ten
commandments’. At the end the leader is referred to as ‘
Gospod Bog
(The Lord God), GB for short’ (which for every Russian means KGB). In English it sounds convoluted. In
Russian, it could not have been more direct, or more provocative.

Two weeks later, on 13 June, Gusinsky was arrested. Putin feigned complete innocence when asked about it by a television reporter. ‘It was unexpected for me,’ he said, barely able to
stop a little smile playing on his lips. ‘I hope the authorities who made this decision – I suppose it was the prosecutor’s office, yes? – have good reasons to justify their
action.’

Gusinsky was given a choice: sell his media empire to Gazprom or face prosecution for large-scale fraud. It was blackmail. He agreed and fled the country. Russia’s freest media group was
now under Kremlin control.

The other big media tycoon, Boris Berezovsky, fared no better. He had been accused of fraud under the premiership of Primakov, but the charges were dropped when Putin became prime minister, and
he was seen as by far the most powerful oligarch – with a media empire as well as massive industrial and commercial assets, including the oil company Sibneft and the airline Aeroflot. As he
was gradually squeezed out of Putin’s inner circle, so his media became ever more critical. In June he criticised plans announced by Putin for a recentralisation of power, and the day after
Gusinsky’s arrest the public prosecutor announced he was extending an investigation into Aeroflot’s finances. Berezovsky was suspected of fraud and money-laundering on a massive
scale.

Just before his election in March, Putin had pledged to outlaw the oligarchs: ‘Those people who fuse power and capital – there will be no oligarchs of this kind as a class.’
The phrase sent a chill down many spines, as it recalled Stalin’s policy of liquidating the kulaks, or rich peasants, ‘as a class’. What he objected to was the idea that wealth
(especially fabulous, ill-gotten wealth) should render political influence. Even though Berezovsky had helped him come to power, Putin resented the influence he wielded through his media empire
(which included not just ORT but another channel, TV-6, and several newspapers).

As in Gusinsky’s case, Berezovsky’s downfall may have been triggered, or hastened, by a television programme. When the
Kursk
nuclear submarine sank in the Barents Sea on 12
August 2000, leading to the deaths of 188 crew members, ORT excoriated Putin for his tardy response. The station’s top presenter, Sergei Dorenko – the attack-dog taken on to help
Putin’s party win the election at the end of 1999 – now poured his bile on the president. Putin had remained on holiday in Sochi for a full five days following the accident, and it was
another four before he visited the northern garrison town and met the dead servicemen’s families. He had also turned down offers of help from Britain and Norway. Dorenko dissected an
interview given by Putin to justify his response, and sneered at every phrase, as though he had nothing but contempt for the country’s president. For example, Putin was shown saying that
foreign help was offered only on the 16th. Dorenko heaved a big sigh and retorted: ‘I’m sorry, but in fact they offered to help on the 15th, and they would have offered earlier if we
hadn’t been lying to the world that everything was OK and we didn’t need help.’ Dorenko also broadcast a secret recording of a meeting Putin held behind closed doors with
relatives of the dead, in which he was heard blaming the
media
for the disaster: ‘They’re liars. They’re liars,’ he said. ‘For the last ten years television has
been destroying our army and navy, that people are dying in today ...’

Dorenko’s show was axed. And soon it was Berezovsky’s turn to follow Gusinsky into exile. At the end of August Berezovsky went to the Kremlin to see Putin’s chief of staff,
Alexander Voloshin, who gave him an ultimatum: to transfer his ORT shares to the state or ‘follow Gusinsky’ – that is, face prosecution. The next day Berezovsky was received by
Putin himself, who accused the businessman of deliberately trying to destroy him. They had a furious row. According to Berezovsky, Putin said to him: ‘You should return your shares under my
personal control ... I will manage ORT on my own.’ Berezovsky vowed never to do that, and stormed out.

In fact Berezovsky did surrender his control of the station, selling his stake to fellow oligarch Roman Abramovich, who meekly transferred his voting rights to the state, thus completing the
government’s takeover of the channel. But this did not stop the attacks against Berezovsky. On 1 November the state prosecutor accused him of defrauding Aeroflot of hundreds of millions of
dollars. Berezovsky was abroad at the time and decided to stay there. From the safety of exile he claimed that the money he was alleged to have embezzled was partly used to finance Putin’s
election campaigns.

Berezovsky has lived in London ever since, despite repeated Russian attempts to have him extradited, and was granted political asylum in September 2003. Putin personally intervened to try to
persuade Britain to send him back, and in so doing betrayed his lack of understanding of Western systems. He asked Prime Minister Tony Blair to put pressure on the courts to extradite Berezovsky.
According to a well-informed source, Blair explained that this was impossible in the UK: it was a magistrate’s decision, not the government’s. Putin, unable to fathom the independence
of the courts, took offence.
¹
This was the KGB man speaking, the product of a Soviet upbringing unwittingly applying his own undemocratic standards to a
Western country.

There is no reason to think that Putin was dissembling; rather, it seems clear that he actually believes that it is normal for Western politicians to influence the courts in the same way as
Russian leaders can. His belief that governments control the media is similar: in 2005 he accused President Bush to his face of personally ordering the sacking of the veteran CBS news anchor Dan
Rather. And on another occasion he told a journalist who questioned why Russian police routinely beat up peaceful protestors that in the West it was ‘normal’ for demonstrators who found
themselves in the wrong place to be ‘beaten around the head with a baton’.

The vertical of power

The crackdown on the free media was not the only reason why the West’s admiration for President Putin’s first steps in foreign policy and economic reform, described
in the first two chapters of this book, was tempered from the start by wariness about his understanding of democracy.

One of Putin’s earliest decisions as president was to start creating what he called the ‘vertical of power’ – the gathering-in of all political power to the centre, and
effectively into his own hands. He believed that lack of central control lay at the heart of Russia’s woes, that Yeltsin’s weak leadership had allowed crime and corruption to flourish,
oligarchs to amass power and the country’s regions to spin off into separate orbits. Yeltsin had encouraged the regions to ‘take as much sovereignty as you can swallow’, which had
had the unwanted effect of allowing governors quietly to ignore or even sabotage edicts from the centre, threatening the disintegration of the federation. Many regions passed laws that contradicted
the Russian constitution, withheld taxes from the centre and struck bilateral agreements with foreign countries. Some of them could have survived well as independent countries: the republic of
Yakutia, for example, produces one-quarter of the world’s diamonds (and has a population of less than half a million); Khanty-Mansiisk (population 1.5 million) is the world’s second
largest oil producer.

On 13 May – just six days after his inauguration – Putin announced that the country’s 89 regions would be placed under the control of seven ‘super-governors’
personally appointed by the president. Five of Putin’s seven enforcers turned out to be
siloviki
²
– men with careers in the security
services and armed forces. They included Viktor Cherkesov, first deputy director of the FSB, whose work in the past had included the persecution of Soviet dissidents.

Six days later Putin initiated a reform of the upper chamber of parliament (the Federation Council or ‘senate’). Previously, elected regional governors and heads of regional
legislative councils were
ex officio
senators; now the regional bosses were replaced by
nominated
representatives, allowing the Kremlin to fill the Federation Council with
‘friendly’ senators.

Putin then moved to centralise the collection and distribution of taxes, which had been about 50–50 between the centre and the regions, to 70–30 in favour of the central
government.

The apex of the new vertical of power was not the federal government, however, but rather Putin himself – something he achieved by appointing trusted colleagues from the security services
or from his home town, St Petersburg, to key positions. Many of them, moreover, were also given directorships in state companies, thereby enmeshing the country’s political and business
structures in a vast spider web, at the centre of which sat Putin.

Igor Sechin had the perfect pedigree: he had worked with Putin in St Petersburg, and by some accounts may also earlier have been a spy, working undercover as a translator in Portuguese-speaking
African countries. He became Putin’s most trusted adviser, and followed his master from St Petersburg to Moscow in 1996. When Putin became acting president he retained Yeltsin’s chief
of staff, Alexander Voloshin, but immediately appointed Sechin as deputy chief of staff, controlling the flow of papers that crossed his desk, and in effect running the energy industry. In 2004 he
also became chairman of the board of Rosneft, the state oil company.

Viktor Ivanov, from the Leningrad KGB, became Putin’s deputy chief of staff in charge of personnel matters – and also chairman of both the Almaz air defence corporation and Aeroflot.
Sechin and Ivanov were considered the most powerful
siloviki
in Putin’s circle.

Dmitry Medvedev, another former colleague of Putin’s from St Petersburg, came to Moscow in 1999 to become a third deputy chief of staff, and also chairman of the state gas monopoly,
Gazprom.

Putin brought his St Petersburg colleague Alexei Miller to Moscow to become deputy minister of energy and then CEO of Gazprom.

The two chief economic reformers, German Gref and Alexei Kudrin, also came from St Petersburg. Gref served on the board of Gazprom, and Kudrin became chairman of both VTB bank and the diamond
producer Alrosa.

Sergei Naryshkin, another Leningrader and former colleague at KGB school, was promoted in Putin’s second term to government chief of staff, as well as chairman of the board of Channel One
television and deputy chairman of Rosneft.

Another old Leningrad KGB colleague, Nikolai Patrushev, became chairman of the FSB, following Putin himself.

Rashid Nurgaliyev worked under Putin in the FSB and then became interior minister. Cherkesov, mentioned above, was another subordinate of Putin’s in the FSB.

Sergei Chemezov, a fellow spy with Putin in Dresden, was brought in to run Rosoboronexport, the country’s chief arms exporter. And another ‘Chekist’, Vladimir Yakunin, was
brought in to the transport ministry and eventually became head of Russian Railways.

Yakunin has another link to Putin: they are both founding members of a so-called ‘dacha cooperative’ known as
Ozero
, which manages their adjacent country houses on
Komsomolskoye lake near St Petersburg. All of Putin’s other friends from the
Ozero
group (as we shall see in Chapter 12) now hold top positions in government, banking and the
media.

The Chechen war and the backlash

During Putin’s first years as president events in Chechnya cast a long shadow over his claims to be bringing Russia into the ‘European family’. I spent several months in
Chechnya during the earlier war (1994–96) and saw for myself how the republic was ravaged by Russian forces. It seemed to me that there was more than sufficient evidence of serious war crimes
and human rights violations, which I and scores of other journalists documented, but the international community – perhaps because it was preoccupied with the simultaneous wars in the Balkans
– did nothing about them. The total devastation of the capital, Grozny, and the deaths of tens of thousands of civilians, whose apartment blocks were literally pulverised by Russian air power
and artillery, could not be justified by the alleged purpose of destroying ‘bandits’, as the rebel forces were known. I interviewed survivors of Russian ‘filtration camps’
– notorious prisons where Chechens were tortured to extract confessions, or just for fun. I visited huge open graves, filled with hundreds of bodies, some with their hands tied behind their
backs. I met dozens of grieving families, saw murdered women and children, hundreds of homes destroyed in villages all across Chechnya, streams of refugees fleeing from Russian troops, people
cowering in basements from air attacks. I met defenceless, bedridden old people, all but freezing and starving to death in the rubble of their homes. But this was under Boris Yeltsin’s
presidency, and the West, besotted with his alleged devotion to democracy, offered only limp condemnation, considering the conflict to be an ‘internal affair’.