On the scandal in the Culture ministry

June 25, Culture Minister Alexander Sokolov says during the show Post Scriptum on TVTs TV Channel ‘bribery at all levels’ is blooming in the subsidiary Culture and Cinematography Federal Agency (FAKK).

June 26, FAKK Chief Mikhail Shvydkoi claim that he and his agency will sue Sokolov

After the reform of the government in March 2004, the Culture minister post that was earlier occupied by Shvydkoi was given by President Putin’s decree to Alexander Sokolov, who did not belong to any grouping. At the same time, Mikhail Shvydkoi and Mikhail Seslavinsky, who used to work in the ministry and belonged to the ‘old Moscow’ elite team, headed two important agencies of the ministry – FAKK and the Federal Agency for Press and Mass Communications. At that, Seslavinsky right away had troubles with Minister Sokolov around the mass media licensing authority. Initially, Sokolov was winning the fight but than this competence was given to the Seslavinsky’s team.

The relations both inside the ministry that had to form the priorities and leech the money from the budget, and inside FAKK that still controlled the money, were growing intense. Shvydkoi himself repeatedly complained that the ministry machine tried to interfere with the money distribution on the projects that the agency carried out. Thus, the difficulties between the departments were escalating – the agency that was formally submitted to the ministry did not want to share the control over the budget money. Besides, there were controversies between the minister and the agency chief, for example, regarding the restitution, to which the minister opposed unlike Shvydkoi, who stood for it hard allegedly, as the Russian press suggests, due to his personal interest in that.

In the end, the conflict turned into the open opposition: the minister blamed Shvydkoi’s agency for corruption. In his turn, chief of the agency plans to sue the minister asking the money compensation for the moral damage and the spread of the false discrediting information for 1 ruble.

June 28, State Duma Vice Speaker Sergei Baburin is ousted from Homeland fraction for the ‘splitting activities’.

The election bloc Homeland was unstable from the start. It was established on the eve of the Duma elections in 2003 in order to take the leftist-patriotic niche and succeeded at this (received 9% of the electors’ votes), however, shortly after the elections it entered the struggle between the leaders of its makers. The bloc was built on the basis of the three organizations: Party of the Russian Regions (Dmitry Rogozin the leader), People’s Will Party (Sergei Baburin), and the United Socialistic Party of Russia (Vasily Shestakov).

At that, Rogozin was not unfounded ascribing the success to his person – many experts believe that the active advertisement of Homeland on the eve of the elections in all national mass media was the result of an agreement between Rogozin and the ‘technological’ part of the Presidential Administration that set to weaken the electoral positions of KPRF with the help of the bloc. This is why Rogozin shortly after the elections took the course on building the full-fledged party on the platform of the loose bloc. By the summer of 2004, Rogozin managed to shove Sergei Glaziev from the leading positions of the Russian Regions Party and hold the first gathering of the new party, appropriating the Homeland brand. Having agreed with Glaziev, Rogozin tried to extend his success and suggested that the leaders of the other two parties dismiss them and enter the Homeland Party because the new election law bans blocs. The experienced politician Sergei Baburin probably tried to agree with Rogozin to become the co-leader of the united party. However, since he did not get this, he began to destabilize the union relations, especially since Rogozin himself gave convenient grounds for the criticism from the associates in the bloc. Particularly, Baburin opposed to Rogozin’s usage of the ‘color revolutions’ rhetoric and the friendly relations with the Socialistic Party of Ukraine, a member of the ‘orange union’. One of the latest Baburin’s moves aimed at such destabilization was the statement that the mass media run by Boris Berezovsky had a positive estimation of Rogozin’s Homeland.

Having realized that it was impossible to include Baburin and his party into the Homeland, Rogozin decided to brake up with him, initiating his resignation from the fraction and advising that the State Duma dismisses him from the vice speaker post.

Meanwhile Baburin and his followers are trying to fortify his potential, including at the expense of the bloc’ resources. If 14 followers of Baburin will leave Homeland, the fraction will have only 26 deputies left, with all of them being consistent followers of Rogozin. At that, it might lose the vice speaker post too. According to the regulations of the Duma work, the final decision regarding the candidacy for the vice speaker post will be taken by the house and it might refuse to dismiss Sergei Baburin or if agrees, the deputies might not confirm the candidacy that Homeland will propose instead. Although all the previous conflict situations regarding the candidacy for the vice speaker post from the faction were settled in the fraction’s favor, it is possible that the struggle that unfurls today in the Duma will be conducted to different rules because its scale might go beyond the bloc and the lower house.

It is possible that the recent Baburin’s statements were a part of the ‘old Moscow’ PA plan to weaken Rogozin. It will be possible to say whether the ‘old Moscow’ team are ready to undertake the maximal weakening of Homeland after the results of the upcoming voting in the Duma on Baburin’s further presence on the vice speaker post. If the United Russia fraction, run by the ‘technologists’ will leave this power for Baburin, this will mean the beginning of the PA’s plan set to create bigger problems for Homeland.

It is possible that there are more profound political games going own that split the Homeland. The upcoming election cycle forces the leading political groupings of Russia seek the mechanisms of its ‘successor’ project. The ‘liberals’, ‘jurists’, and the ‘old Moscow’ groups, supported by a part of the rough and the ‘old Moscow’ businesses have seen the way to preserve the power and the property in their hands by means of the ‘liberal-conservative project’ of late. At the same time, the siloviki that seem to have their own ‘successor’ project’ plans cannot undertake them without an ideological and organizational platform. Rogozin’s ideology, however, especially the statements during the last gathering, fits perfectly for the siloviki’s people’s patriotic union. In relation to this, it is possible that now the both sides are at the threshold of the moment of truth, when they might try to form a union.

The liberal trend that has been taking shape in the Russian power becomes more noticeable, at least at the level of goals’ declaring. During the last months, the acting administration and the top officials of the country strive to show their adherence to the liberal ideology. This was demonstrated by President Putin in his two important documents – the State of the Nation Address to the Federal Assembly and the Budget Message – as he emphasized on the need to prevent the state organs from pressing on the business. The leaders of the ‘liberals’ team are always speaking about the need to protect the business form the tax burden as well. Among them are Finance Minister Aleksey Kudrin and Economic Development and Trade Minister Herman Gref. Even Premier Mikhail Fradkov, who used to stand for the idea of state’s active interference in the economic projects and proposed the increase state investments into the economy at the expense of the additional budget profits, now became the ‘liberal’ and during one of the government meetings told the ‘liberal’ Gref that he should not account of the Stabilization Fund’ resources.

Finally, the views of Igor Shuvalov underwent the most serious transformations, as he used to claim in March that it was impossible to do without the Yukos affair: ‘The state’s position should be tough: the legislation should be liberal but the state machine should force its observation’. During his last briefing, however, Shuvalov admitted that the Yukos affair had a negative influence on the Russia’s image and it would take several years to restore it: ‘We have to work hard to eliminate the negative consequences that the Yukos affair had led to, restore and fortify the image of the Russian Federation’. The first thing that should be done is – ‘to try not to let another similar affair start’. This ‘requires amendments to the legislative base so that investor would feel protected from the state’.

Of course, all these statements are aimed mostly at the foreign investors. On the eve of the G8 summit, the Russian power managed to convince the western investors and the governments of the favorable investment climate in Russia and of the adherence of its administration to the democratic values. Despite the split of the Russian elite, all the political groupings realize the ultimate necessity for the foreign investments in Russia, seeing one of the main motors of the economy growth in them.

However, it seems that the liberalization of the elite is linked to the ongoing processes of forces and power redistribution. Having realized the possible negative consequences of excessive strengthening of the St. Petersburg’s siloviki team, other elite groups, as well as the large businesses that have no relation to siloviki, came to the need to form an anti-siloviki union. And the technological part of the Presidential Administration suggested the so-called liberal-conservative ideology for such pact. It seems that President Putin, who sees his political role in the preservation of the elite balance and cares for his image in the eyes of the West, also decided to back the anti-siloviki bloc. Sensing the trend, other political players also began to elaborate on the liberal rhetoric.