Putin's power play

November 04, 2003|By Anna Johnsson

WASHINGTON - Recently arrested Russian oil tycoon Mikhail B. Khodorkovsky broke six rules of doing business in Russia that cost him dearly:

Do not become the wealthiest person in Russia.

Do not run your company in a relatively transparent and Westernized manner.

Do not invest money in the civilian sector.

Do not support reform-minded political parties.

Do not suggest that presidential power be limited and that parliamentary power be increased.

Do not solicit support from the United States, especially not if the Russian president is friendly with the American president.

Shortly after returning from the United States and meeting with U.S. officials and oil executives, Mr. Khodorkovsky was arrested by FSB, Russia's federal security service. Interestingly, while in the United States, Mr. Khodorkovsky, chief executive of Yukos Oil, was negotiating the details of a $25 billion oil contract with ExxonMobil. Appallingly, there was the cold calculation on the part of President Vladamir V. Putin's spin doctors that reaction from European and U.S. leaders would be exceedingly weak.

Mr. Putin's dismissive statements after Mr. Khodorkovsky's arrest only amplify this point. He claims that the arrest is not a political issue and that, consequently, the law will speak for itself. Regardless of Mr. Putin's claims, the Russian judicial system is not known for its dedication to either the letter or the spirit of the law.

In reality, arresting Mr. Khodorkovsky was not the law speaking. It was a president who has for years systematically removed any threat to the monopolization of power by him and his entourage, the FSB.

Unfortunately, Mr. Putin's moves have so far been allowed to again pass without a substantive reaction. This should be seen in the wider context of the Bush administration's reported plans to end financial and other support for democracy advocates and nongovernmental organizations in Russia.

Mr. Khodorkovsky's arrest gives the United States an opportunity to show its sincerity in supporting Russia's reformers. Mr. Putin or Mr. Khodorkovsky? Pick your poison, but consider who has acted lately in favor of reform and capitalism. Not Mr. Putin. Supporting Mr. Putin over Mr. Khodorkovsky, directly or indirectly, undermines the embryo of reform that is slowly being built in Russia.

What signals does the United States send when reform-minded businessmen and politicians, nongovernmental organizations and investigating journalists are being left alone to face an increasingly authoritarian political climate in Russia?

Considerations of national security, oil or ExxonMobil's position in the world oil market are all involved in U.S. decision-making. But in the long run, U.S. policy conducted toward Russia today is neither in the interest of the Russian people nor in the interest of the United States.

The conclusion is that the movement toward complete state control of both the mass media and the energy sector is being finalized in Russia. Whether Yukos Oil will be controlled by the Russian state will be a tell-tale sign of this development. If this happens, as is likely, Mr. Putin and his entourage can be sure that business will go on as usual without reformers trying to create economic and political pluralism in Russia.

Mr. Khodorkovsky went to Washington to seek support. Apparently, his efforts were not successful. If released Dec. 30, Mr. Khodorkovsky can always follow the example of fellow oligarch Roman Abramovich - buy a British soccer team and stay out of Russian affairs.

Plans to increase Russian oil and gas exports to the United States through 2010 are important to U.S. energy security. With major oil deals in the making, Mr. Putin is sending a clear signal: It is safer to deal with the Russian president than with independent oligarchs such as Mr. Khodorkovsky. It's up to the United States to determine whether that is good for America.

Anna Johnsson, a visiting scholar at American University's Washington College of Law, is a specialist in Russian law and politics at Uppsala University in Sweden.

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