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Sestanovich: Behind the Scenes ‘Warfare’ As Russia Awaits Putin Successor

Interviewee: Stephen Sestanovich, George F. Kennan Senior Fellow for Russian and Eurasian Studies
Interviewer: Bernard Gwertzman, Consulting Editor
February 26, 2008

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Stephen Sestanovich, CFR’s top Russia expert and a former ambassador-at-large to the former Soviet states, says there is no doubt about who will succeed Vladimir Putin as Russia’s president, but adds that there is “a real drama playing itself out” behind the scenes. Sestanovich says: “there’s a kind-of under-the-carpet warfare that is underway in anticipation of a possible change in the balance of power when Dmitri Medvedev takes over the presidency and Putin becomes prime minister.”

Russia’s going to the polls on Sunday to elect a new president. First Deputy Prime Minister Dmitri Medvedev has been handpicked by President Vladimir Putin to be his successor and everyone expects this to be a farce of an election. Do you think that’s right? Or are there some real underlying issues here?

Well, the drama associated with this transition—if you can call it that—is not about what will happen when the voters go to the polls. That is just a formality. But there is a real drama playing itself out that involves factional politics and policies and I think the future of Russia. You can see this at a number of levels. One is the kind of factional jockeying that is underway amongst parts of Putin’s entourage, including branches of the old KGB. There has been a tug of war between the Russian Federal Drug Control Service [FSKN] and the Federal Security Service [FSB]—the main successor to the KGB—that got so bad that one of the old former heads of the KGB had to appeal in public for a cooling of the conflict.

What was the issue?

The issue is turf, and whether one agency would be biting into another’s livelihood. And you’ve seen this in other realms. There has been unexpected and detailed publicity about Putin’s alleged fortune in the Russian media.

Did I see a report that Putin has about $400 million stashed away?

$40 billion is the standard figure that has appeared in the press.

And he’s got it sequestered overseas, or what?

It’s in different forms, in different corporations. But the pieces of it add up to $40 billion. And even under Russian law, it might not withstand the light of day.

Well that’s incredible. Has he talked about it?

Putin was asked about this in his press conference two weeks ago. And he tried to laugh it off by saying he’s the richest man in the world—rich because he’s a collector of emotions, and rich in the satisfaction that he’s derived from being able to serve his country. But the fact that this could appear in print is taken by many Russians as a sign that Putin is not invulnerable. There have been arrests of other officials [such as] Deputy Finance Minister, Sergei A. Storchak, accused of millions of dollars of illegal investments as a possible shot across the bows at the finance minister, Aleksei L. Kudrin. The arrest of a figure [like Storchak] who has been involved in the Russian-Ukranian gas trade is treated by some Russians as a shot across the bow of Medvedev himself, because Medvedev is the chairman of Gazprom. So there’s a kind of under-the-carpet warfare that is underway in anticipation of a possible change in the balance of power when Medvedev takes over the presidency and Putin becomes prime minister.

Medvedev is one of the few officials, it looks like, in the high levels of Russian government who is not a former KGB or FSB agent. I saw one figure that said about 75 percent of all high officials in Russia had some connection to the KGB or FSB.

He’s not the only one, but it was a surprise to some people that Putin picked somebody without the old-school tie [Putin himself was a career KGB agent]. And, in fact, the reason for his choice may have been precisely not to favor one KGB faction over another, and not to empower one group of the siloviki [the Russian term for security apparatus] and put the others out of business. This is the school of thought that has it that Medvedev is chosen because he is weak, and will not threaten the existing distribution of power.

Has Medvedev said much while campaigning?

He has conducted something like an old-style, front-porch campaign with few real speeches and appearances. He has declined to debate his opponents, which is what any politician would do with the kind of lead he has in the polls. A lot of his appearances around the country are of the “it’s-great-to-be-here-in-Saratov” variety. But he did make one speech that got a lot of attention, and it deserved a lot of attention. It was a speech in Krasnoyarsk that sets out his view of what needs to be done in the next few years. It is not a blueprint of continuity. The spirit of it is really quite different from what Putin has been trying to do. And although you might be able to identify this or that line that Medvedev uses [in] any of Putin’s own speeches, this is really a kind of manifesto for a more liberal and democratic formula for governing Russia. There’s a lot of criticism in it of excessive state control. He talks about the need to reduce the regulatory authority that gives officials so many opportunities for corruption. He talks about the need to give people the opportunity to make their own decisions. He makes a very specific attack on the growth of state corporations, saying that the majority of state officials on their boards have no reason to be there. This is, by the way, a real attack on the bread and butter of many of the other members of the Putin entourage.

You mean the fact that so many former KGB officials are on the boards of directors of government-controlled firms?

Absolutely. He talks about the need for real independence of the media. The most interesting part of it is where he talks about a popular consciousness and the post-Soviet mentality. He says that, in Russia, the concept of private ownership is still not well understood and respected. Polls show that large numbers of people really believe the government ought to control prices. And he says that there needs to be a new, more individualist consciousness created through things like home ownership. He says, in effect, there has to be a change from the mentality of grubby collectivism, which was only strengthened by the difficulties of the 1990s. He’s not running primarily against the 1990s, as Putin has. He’s running against some of the things that happened under Putin, and running against the legacy of Soviet times. And that’s very interesting talk. It’s quite different from Putin himself.

Did this get a lot of attention in Russia?

It did. And a lot of liberals were jolted awake by it, and have talked about what it might mean. But nobody can be sure of what it means. Nobody knows how seriously to take it.

Would he have the power to clean house, without Putin going along?

I think Medvedev will have very little power to do anything, at least at the outset, without clearing it down to the last detail with Putin. The powers that Medvedev will have, formally, as president, are very great. But as a practical matter, he’s not going to do much until he knows that Putin is onboard.

How do you explain Putin’s evolution? When he came into office he seemed to go out of his way to repair relations with the West, including the United States. He became George Bush’s great pal in 2001, and now he’s considered in the West a real tough guy, pushing traditional Russian power interests. Is this simply due to the fact that Russia’s economy has been booming?

It’s partly that. There’s the fact that Russia’s got the third largest currency reserves in the world, which can give a Russian president the kind of confidence that he didn’t have when Russia was bankrupt. On the other hand, I think there’s a little bit more to it that that. Putin has found that Russian nationalism plays pretty well at home, and he started seeing this a bit more when he worried about the Orange Revolution contagion [the so-called “Orange Revolution” occurred in Ukraine when a more pro-Western leadership ousted a pro-Moscow one in 2005]. It was then that he formed, or caused to be formed, this nationalist group, Nashi [Ours], to try to win Russian youth over to his kind of in-your-face approach to the West, so that they’d be less susceptible to what he saw as subversive Western influences. And it has been popular for Putin at home. But what’s interesting is the signs that you see of some unease within the Russian elite about whether this has gone too far, whether it’s alienating Russia’s friends and partners abroad.

The most publicized example of this came last month in a discussion that gained a lot of attention, in which Anatoly Chubais, the head of the Russian electricity monopoly, and Aleksei Kudrin, who is the finance minister, both talked separately about the price that Russia had paid for a belligerent foreign policy.

This is going to be a very interesting transition. When does Medvedev actually take office?

The first week of May. There’s a two-month transition in which, Russian commentators have been saying, for the first time there will be a president-elect, and an outgoing president in office. The Putin-Yeltsin transition didn’t work that way.

Has Medvedev given any indication who will be in his cabinet?

Not that I’ve seen.

So it will be interesting to see who he chooses?

Yes. But when Medvedev was first picked as Putin’s successor, he spoke about the importance of maintaining this wonderful team that Putin had assembled, which was an effort to reassure people that there wouldn’t be too much turmoil. The old phrase that Leonid I. Brezhnev used when he and his friends took over from Nikita S. Khrushchev [as the head of the Communist Party in 1964] was “stability of cadres,” meaning your job is secure unless you make a lot of trouble. Medvedev may employ the same strategy, but just as Putin did after one or two years passed, there will be opportunities for him to make some changes.

Some people wonder “how can two people run the government?” But of course in the communist days, you had party leader Leonid Brezhnev and Prime Minister Aleksei Kosygin. And I guess back in the days of Tsar Nicholas II, you had a powerful prime minister in Pyotr Stolypin, in the early twentieth century.

In those days, it was always clear who was really in charge. For a time, there will be deference to Putin, and a respect for his power, and it will constrain Medvedev. But the President of Russia is not without opportunities to establish his own path and to build up his own power position. What we’ll have to find out about Medvedev is what kind of a political insider he is in using the powers that are, at least on paper, available to him. But as one Russian commentator said about him, “he doesn’t radiate danger.”

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