On February 20, shortly before the election that put him back in the Russian presidency, then-prime minister Vladimir Putin wrote an article in a government-owned newspaper. Its title was, “Being Strong: National Security Guarantees for Russia”. He recalled the army chief telling him in 2002 that there was no money to run a certain base in Russia’s far east.
“[T]he Chief of the General Staff proposed liquidating a base for strategic ballistic missile submarines on the Kamchatka Peninsula,” Putin wrote. “This would have deprived Russia of its naval presence in the Pacific Ocean. I decided against this. Due to the lack of the required budgetary funding, we had to ask private companies for help. I would like to thank them for that. Both Surgutneftegaz and TNK stepped up to provide the required funding for the base’s initial reconstruction.”
Isn’t that wonderful? Two private companies fund a nuclear submarine base out of patriotic generosity. (Just imagine such a statement by an Indian prime minister. The skin crawls.)
The background: Surgutneftegaz is a gas company; TNK is an oil company half owned by BP. Starting in 2003 during Putin’s first term as president, the government charged Mikhail Khodorkovsky, a billionaire oligarch then showing signs of political ambition, with fraud. He was arrested and thrown in jail – where he is still – and his oil company Yukos was taken apart for its assets. One of its chief assets was Yuganskneftegaz, a company that controlled vast oil reserves.
Who got Yuganskneftegaz? Let me quote from the Washington Post of December 20, 2004. “Russian newspapers reported that BaikalFinansGroup, the company that won control of the Yuganskneftegaz oil fields at an auction [on December 19], was represented by employees of Surgutneftegaz, another major Russian oil firm that has large cash reserves and close ties to the Kremlin. Baikal, a previously unknown company, bid $9.3 billion.”
Baikalfinansgrup’s registered office was in a tiny building used for the same purpose by 150 companies. It had a paid-up capital of $300, yet the state oil company Rosneft lent it $9 billion to buy Yuganskneftegaz. (It was reportedly worth twice that.) When Putin was asked about this sale on a visit to Germany two days later, he bristled. “I know the stockholders of the company,” he said. Two days after that, Rosneft bought Baikalfinansgrup.
And TNK? Well, after a dispute between BP and its Russian partners, TNK’s American CEO made way for one of the Russian partners, the well-connected billionaire Mikhail Fridman.
This is all public information. One might suspect no more than massive corruption, but the Russian-American Moscow journalist Masha Gessen goes much further in her superb, paralysingly scary new book on Putin, The Man Without a Face. She says that behind it all, directly or indirectly, is Putin. He is, she says, a man with a twisted worldview. He has a fixation with strength, military power, and being feared. She calls him small, vulgar, vindictive; a thug, a thief, a mafia godfather. She says he wants power but not responsibility, that he will spill Russian blood to get what he wants. She offers evidence for each assertion.
The evidence begins with Putin’s autobiography, hastily prepared in 1999 to introduce Russia’s new president to its citizens. Putin had been hand-picked as Boris Yeltsin’s successor for his apparent facelessness and loyalty, says Gessen. What the country needed was an institution-builder and democrat. What it got was a man who took “strength” and “pride” literally.
So Putin talks proudly of his youth as a street tough in Leningrad/St Petersburg, never shy of a fight and willing to bloody anyone. He joined the KGB but made little headway for 20 years. Nevertheless, he was noticed for his loyalty, says Gessen, by a Yeltsin crony, the oligarch Boris Berezovsky.
The tough guy, as Putin guessed, was the leader that many Russians wanted. What Russians did not realise, says Gessen, was that Putin would take apart the institutions of democracy, using always as his pretext the threat of terror, Chechen terror in particular. Gessen lays at Putin’s door a series of apartment bombings across Russia in 1999, as well as the appalling death tolls in two hostage crises, in a Moscow theatre in 2002 and a Beslan school in 2004 — events which had the world wondering about the Russian forces’ behaviour.
The case of Yuganskneftegaz contains the keys to Putin’s Russia, Gessen implies. Khodorkovsky was rich but opposed to corruption, and believed he could challenge Putin. He lost his freedom, and then he lost his company. The company was acquired by those believed to be close to the Kremlin. (Gessen quotes an insider who says Putin was worth $40 billion in 2007.) One outcome may have been cash for the submarine base, so Putin could tell voters that he had kept Russia strong.
The message was not lost on other rich Russians with a conscience. Most went into exile. But in one respect, Gessen says, Putin failed: Khodorkovsky is a symbol of resistance. And after huge protests this winter, Putin’s long-term hold, says Gessen, looks weakened. So there is still hope for the Russia that should have risen from the ruins of the USSR.
THE MAN WITHOUT A FACE
The Unlikely Rise of Vladimir Putin
Granta; vi + 314 pages; Rs 550