The New Tsar (66 page)

His aides in the Kremlin responded by unleashing state television on the mayor as fiercely as Boris Yeltsin’s had more than a decade before when Luzhkov and Primakov appeared poised to emerge as the leaders of a post-Yeltsin coalition. After a week of that, Medvedev’s chief of staff summoned Luzhkov and asked him to resign and “leave quietly.” When he refused, the Kremlin told him to go on holiday for a week to think it over.
²³
Medvedev, who privately denounced Luzhkov with an earthy vulgarity for loudmouth that roughly translates as “one who rings his balls,” appeared unable to act without Putin’s approval. Opposition leaders like Boris Nemtsov all but dared Medvedev to demonstrate his authority, but it was only when Luzhkov returned to Moscow and wrote a letter to Medvedev mocking his democratic pretensions and demanding the restoration of elections for mayors and governors (which Putin had taken away) that Medvedev finally received approval to dismiss him. Two weeks later, Putin forced Medvedev to appoint as mayor Putin’s chief of staff, Sergei Sobyanin, a former governor from Siberia who had little experience or knowledge of the capital.

It seemed that Medvedev had triumphed, demonstrating resolve by removing Luzhkov from power, but the confrontation also illustrated the limits of his power as president. The highway construction later went ahead, as planned. The main contractor, the only bidder, was owned
by a convoluted, overlapping chain of companies registered in Cyprus and the British Virgin Islands. One was called Croisette Investments, half of which was owned by another called Olpon Investments. Its sole owner was Arkady Rotenberg. When Medvedev was pressed on why the government had allowed the work to resume, he could only mutter that there were “private interests” involved.
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M
edvedev’s leadership disappointed Putin’s critics, and the constraints on his authority left Medvedev himself frustrated. At the end of 2010, his resentments boiled over for the first time as the fate of Mikhail Khodorkovsky once again hung in the balance. With the end of his first prison sentence approaching, the authorities had launched a new investigation against Khodorkovsky and his partner, Platon Lebedev, intended to keep them in prison. The second trial had begun in 2009, this time on charges of embezzling profits that amounted to more than the worth of the oil Yukos had extracted over a period of six years.
²⁵
It had dragged on for nineteen months. Resigned to a guilty verdict, Khodorkovsky’s lawyers sought to highlight the political motives behind the case instead. They called as a witness Putin himself, as well as Igor Sechin; the finance minister, Aleksei Kudrin; and twenty other officials. The judge refused but did allow some prominent officials to testify, hoping, it seemed, to demonstrate some adherence to due process. They included one of Putin’s oldest colleagues, German Gref, who appeared rattled by being questioned by Khodorkovsky himself through the glass enclosure, where the defendants sat. A crucial moment came when Gref conceded the point that was at the center of Khodorkovsky’s defense: that it would have been impossible for him to have stolen what amounted to a year’s worth of the entire country’s oil production without somebody in the government noticing it at the time.

The courts in Russia had become so politicized by then that Khodorkovsky had no hope of prevailing. His defense was simply an exercise in delegitimizing the judicial process, and in that it succeeded. The prosecution was even more convoluted and confused than at his first trial, making a mockery of Medvedev’s pledges to end “legal nihilism.” The proceedings were riddled with procedural errors, conflated or contradictory accusations, and lacked any semblance of fairness. The spectacle was roundly condemned outside of Russia as an indication of the authoritarian state Russia had become.

On the eve of the judge’s verdict, Putin even intervened forcefully
with one of his own. “It is my conviction that ‘a thief should sit in jail,’ ” he declared in his annual phone-in appearance on December 16, alluding to a line from a popular television serial from 1979,
The Meeting Place Cannot Be Changed
. He spoke of Khodorkovsky’s previous conviction as though it had already proved his guilt with regard to the new charges and compared him to the American financier Bernard Madoff, who had recently been sentenced to 150 years for running one of the largest Ponzi schemes in history. Putin’s response sounded deeply emotional, full of personal anger and indignation. He went even further than the charges themselves, suggesting that Khodorkovsky had ordered his chief of security to carry out the murder of the mayor of Nefteyugansk, where Yukos’s main oil fields were located. “One woman in Moscow refused to hand over her small property, and they killed her, too. And then they killed the assassin they hired to carry out those killings. All they found was his brains, splattered all over his garage.”

At this point, even Medvedev had to object. For the first time, he openly criticized Putin, saying that no one, not the president, not the prime minister, had a right to pronounce judgment before it was delivered by the court. His admonishment had no effect. In fact, the verdict had already been decided, its 878 pages written for the judge to read, as his own assistant would later disclose, describing recurrent meetings and relentless pressure from senior officials. The trial did more than expose the emptiness of Medvedev’s pledges; it signaled an emerging breach between the two that would only worsen, punctuating the end of the “tandem” and the hopes so many had invested in it. The judge sentenced Khodorkovsky to thirteen years in prison, though the term was later reduced slightly. This ensured that, with his time already served, he would remain behind bars until 2016, well past the next parliamentary and presidential elections. Khodorkovsky responded with a series of public and legal appeals, all futile. He taunted Medvedev for his lack of authority and pitied Putin for his vindictiveness. In an open letter in the
Nezavisimaya Gazeta
, he wrote that Putin “was incapable of tearing himself away from the already unmanageable ‘oar’ of the monstrous ‘galley’ he himself has built, a galley that apathetically sails right over people’s destinies, a galley over which, more and more, the citizens of Russia seem to see a black pirate flag flying.”
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CHAPTER 21

The Return

F
or a second day in the autumn of 2011 the delegates of the only political party that really mattered in Russia gathered in Luzhniki Stadium, the country’s premier sporting arena, constructed in the 1950s at the height of Soviet might. It anchored the only Olympic Games ever held in the Soviet Union, in Moscow in 1980, and would soon be refurbished to serve as the main venue for the World Cup in 2018. In December 2010, Russia had won the competition to host the tournament despite a lackluster bid that appeared doomed until Putin personally intervened to oversee the proposal and tap the country’s oligarchs for contributions. Russia was accused of trading votes with Qatar, which also bid and won the cup for 2022, votes that would remain a source of controversy and scandal for the sport’s governing body, FIFA. There were even accusations that Russia had offered paintings from the storerooms of the State Hermitage Museum in Petersburg as gifts to delegates who would ultimately vote to award the cup. One painting was said to be a Picasso; the other was a landscape described by the recipient as “absolutely ugly.”
¹

On that day in September, more than ten thousand delegates of United Russia filled grandstands adorned with party banners and red, white, and blue flags. The gathering resembled not an American-style party convention, but rather a display of fealty to party and state that more than a few observers noticed had an echo of the old Communist Party congresses with row after row of balding or gray-haired men and uniformed generals, festooned with medals from the glorious Soviet past. Only now the production was far slicker: a made-for-television affair that synthesized Soviet-like propaganda with state-of-the-art techniques and technology from the West.

It was just two and a half months before the newest round of parliamentary elections, which the party would, of course, win. Behind the
orchestrated display, however, not all was well. The party’s reputation had taken a dive after the Duma’s failure to do much of anything beneficial for ordinary Russians during its last session, a turbulent period of economic and political crises. The party had by now become an object of ridicule, the brunt of jokes and scandal. The Duma had become a chamber filled with apparatchiks and opportunists, with Putin loyalists and celebrities like Alina Kabayeva or Andrei Lugovoi who were recruited and elected on party lists rather than politicians with genuine constituencies to answer to. In February 2011, Aleksei Navalny, a lawyer who had built a public following by exposing rampant corruption on a blog he kept, had called for a grassroots campaign to destroy United Russia for the sake of the country’s democratic future. In a radio interview, he said that the party had become a manifestation of all that was wrong in Russia and added, almost as an aside, an appellation that proved to be catchy and, not suprisingly, durable: he called United Russia “the party of swindlers and thieves.”
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Navalny had been active in democratic politics since the late 1990s, when he joined the Yabloko party, but he grew increasingly frustrated by that party’s declining relevance and infighting. He was expelled after participating in the Russian March, an annual demonstration of nationalists that was anathema to Yabloko’s liberals. He opened a law firm for a time, but only gained prominence when, like William Browder, he began to investigate the dealings of the opaque state corporations that dominated Russia’s economy. His tactic was simple: acquire shares and investigate their books. As the owner of just two shares of Transneft, the oil-transport monopoly, he demanded to know why the company had donated $300 million to charity in 2007 and yet paid such paltry dividends to its shareholders.
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He had, it seemed, uncovered the company’s scheme to direct huge sums of money to the Kremlin, specifically the Federal Protective Service, which provided security to state officials and was headed by Putin’s longtime bodyguard, Viktor Zolotov.

Navalny had no legal investigative power, but he used the last free space for public discourse in Russia, the Internet, to compile a virtual catalogue of malfeasance, conflicts of interest, and rapacious profiteering from the state’s budget coffers. Expanding beyond Transneft, he highlighted the suspect and usually wildly inflated contracts of government agencies and corporations; the shady business activities of the Duma’s deputies; and the luxurious properties they and government officials were able to acquire for themselves and their children despite their modest
official salaries. He did what Sergei Magnitsky had done, piecing together a trail of evidence from public records that had become more open, if not exactly transparent, in part because of initiatives proposed by Medvedev, including one requiring that all government tenders be posted online. He created a website,
RosPil.ru
, that became a forum for scrutinizing these tenders and managed to create enough public scandal to force the cancelation of some contracts, though few meaningful government prosecutions ever resulted from his disclosures.

Navalny tapped into a simmering discontent with the Duma, with the system, even with Putin himself. It made him famous, and he made no secret of his ambition to lead a political movement that would steer Russia another way. Tall, blond, and handsome, with a chiseled jaw and a sense of joyous outrage, he seemed the first political figure to emerge from the atomized opposition who had the attributes to become a viable challenger to Putin himself. That could not go unnoticed for long. Nor could the role Medvedev’s liberalizing reforms had played in enabling Navalny’s dangerous and unexpected challenge to power.

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U
ntil the second Khodorkovsky trial, Medvedev had never openly contradicted Putin, never challenged him in any way, but as the end of his term as president approached, an undeclared campaign between the camps loyal to each man began to surface. In January 2011, one of Medvedev’s advisers, Arkady Dvorkovich, publicly warned that the second Khodorkovsky trial had harmed the investment climate in Russia, reinforcing the perception that justice in Russia was capricious and deeply corrupted. Weeks later, Medvedev returned to Davos, where he had made his international debut four years before, and outlined ambitious plans to modernize Russia’s economy, reassuring investors that, Khodorkovsky’s case notwithstanding, the country welcomed foreign investors and capital. Only days before his trip to Davos, Medvedev had pushed the New START agreement negotiated with Barack Obama through the Duma, and while in Switzerland, he pledged to revive the talks to enter the World Trade Organization that Putin had upended in 2009. With the election of a new parliament scheduled for the end of the year and the presidential election three months after that, Medvedev presented a competing path for the future, and the insiders in the Kremlin and the government gravitated either toward his or toward Putin’s.

The first question Medvedev faced at Davos was one he had not addressed in his remarks—and one that would prove decisive. It was
about the Arab Spring, which had begun in Tunis in December 2010 and inspired protests that swept through the Arab world, toppling Hosni Mubarak in Egypt and threatening Colonel Muammar el-Qaddafi in Libya. Medvedev replied not only that he recognized the democratic aspirations of the thousands who had poured into Tunisia’s streets to protest corruption, poverty, and lack of political rights, but also that governments had a responsibility to address those grievances. He went on to emphasize the importance of the relationship between governed and government in ways that could have applied equally to Russia, where the will of the people had been managed out of the electoral process. “When governments fail to keep up with social change and fail to meet people’s hopes, disorganization and chaos ensue, sadly,” Medvedev said, apparently warming to the theme. “This is a problem of governments themselves and the responsibility they bear. Even if governments in power find many of the demands made unacceptable they still must remain in dialogue with all the different groups because otherwise they lose their real foundation.”