Archive for December, 2010

The Verdict Is In

Thursday, December 30th, 2010

There is one word that comes to mind when watching the drama surrounding the Mikhail Khodorkovsky verdict and sentence today of 13.5 years in prison. Perhaps tellingly, it is a Russian word: naglost’. English simply doesn’t have one word that packs into so few letters all that naglost’ means: arrogance, contemptuous malice, obnoxiousness, brazenness, insolence, impudence, and sheer nerve. Google Translate suggests no fewer than 22 synonyms, none of which captures the fullness of the word as well as the Russian government has embodied it in this case.

There was, for instance, the postponement. The verdict was supposed to be read on the morning of Dec. 15. Camera crews, journalists, and a crowd of Khodorkovsky supporters showed up at the courthouse to find a piece of paper taped to the courtroom door. The verdict would now be read on Dec. 27, it read, when the world — and foreign journalists — would be on holiday. No one had bothered to alert Khodorkovsky’s legal team. When asked for an explanation, the court spokeswoman snapped, “The court does not explain itself.”

When the court reconvened on Dec. 27, just before the reading of the verdict could commence, Judge Viktor Danilkin called a 15-minute recess. After it was over, he simply didn’t let the journalists back in. Then he shut off the simulcast of the proceedings and kicked Khodorkovsky’s wife and daughter out of the room.

And just when one thought the naglost’ had surely peaked, the court — and, by extension, the Russian government — showed how much farther they could go. In October, the prosecution had cut the volume of oil allegedly stolen by Khodorkovsky from 350 million tons to 218 million, citing a lack of evidence and arithmetical error. But on Dec. 29, Judge Danilkin found Khodorkovsky and his partner Platon Lebedev guilty of stealing — that’s right — 350 million tons of oil. The judge overrode the prosecution, apparently deciding that it was not being prosecutorial enough.

And there’s more: On the second day of monotonous reading (the verdict is some 250 pages, most of which simply recapitulates the trial and all of which has to be read aloud), Danilkin challenged the testimonies of German Gref, the minister of economics and trade from 2000 to 2007, and of Viktor Khristenko, minister of industry. Both had reluctantly testified on Khodorkovsky’s behalf this summer, but Danilkin said that their testimony merely proved Khodorkovsky’s guilt. What had they said in court? Gref testified that had 350 million tons of oil been stolen under his watch, he surely would have noticed — and he didn’t notice any such theft. Khristenko, for his part, explained why it is impossible to accuse Yukos (Khodorkovsky’s oil company) of stealing oil at all. But Danilkin seemed to think that it was, in fact, very possible, and reminded everyone of a crucial detail that, in his view, mortally compromised the two high-level government officials: They had been subpoenaed by the defense. And the defense, let’s recall, is not anything the Russian judiciary takes seriously, even when trying to imitate a fair trial.

On Dec. 30, the third day of the reading, Danilkin accused Khodorkovsky and Lebedev of withholding dividends from shareholders — which, he said, “hurt their feelings” — even though the day before he had found the two former oil executives guilty of bribing board members and shareholders so they would participate in Khodorkovsky’s plot to steal 218 million — wait, no, 350 million tons of oil. How did he bribe them? He paid them dividends.

One could go further and expose more reasoning such as this, reasoning one could call circular if that circle didn’t instantly collapse on itself. It seems a pointless exercise, however, when the charges themselves are completely nonsensical: Khodorkovsky has just been convicted and sentenced for stealing all the oil his company ever produced, after having been convicted and sentenced in 2005 for not paying taxes on all the oil his company ever produced.

Much of the coverage of the verdict and trial has described the affair as a farce, but farce cannot be the right word when, at every step, the court has displayed such a flippant disregard for even the barest semblance of logic, or when it pulls such childishly malicious stunts as coaxing the press out of the courtroom. (Or when it seems to just be half asleep: In the course of mechanically reading the verdict, Danilkin occasionally read pages twice, or pages from something else altogether that had somehow made it into his stack of paper.)

Sadly, this is not just about the Khodorkovsky case, which is still ignored by a massive — if shrinking — segment of the Russian population. This is about a large and growing arrogant impudence embodied not by the Kremlin, but by the real master of the house, Prime Minister Vladimir Putin. Plans to hew a road through the federally protected Khimki forest this summer sparked an unexpectedly fierce public resistance, so President Dmitry Medvedev pulled the plug on the project until the experts could deliver their opinion (which no one had asked them for in the beginning). Earlier this month, however, the original plan for the road was reapproved: Putin’s friend, Arkady Rotenberg, just had too much money riding on the project.

What else? In November, the lawyer-cum-blogger Alexei Navalny posted Treasury Department documents showing that Transneft, the state oil transport monopoly, had stolen a humble $4 billion in building an oil pipeline to China. How did the government respond? The next day, Putin publicly thanked Transneft “for its big contribution to the development of energy cooperation between the Russian Federation and the People’s Republic of China.”

During Putin’s annual December phone-a-thon with the Russian public, he received a question from the town of Ivanovo, from a cardiologist named Ivan Khrenov. Khrenov alleged that all that hi-tech equipment and the happy, well-paid doctors the premier saw during his visit this November to Khrenov’s hospital had been brought in for the occasion, a near-literal Potemkin Village. “What you saw in the wards also has little to do with the real situation,” Khrenov said during the live broadcast. “Most of the patients were asked to leave the hospital on the day of your visit, and in some wards the patients were disguised as members of the hospital’s staff.” Putin, seemingly surprised and dismayed by this allegation, ordered an investigation. But the special commission investigating the charges found that Khrenov had been lying, of course. (Khrenov is now being accused of slander, in a turn of events reminiscent of Alexey Dymovsky, a police officer who issued a YouTube video detailing grotesque corruption in his unit. He was jailed and bankrupted.)

The most shocking example of this fuck-you attitude is the case of Sergei Magnitsky, a 37-year-old lawyer for Hermitage Capital, then the biggest foreign investment company in Russia. He died in November 2009 under stomach-turning conditions while being held in pre-trial detention. He had been put in prison ostensibly for evading taxes, though he was forced to recant his findings that three Interior Ministry employees had, through forged Hermitage documents, stolen $230 million of Russian tax revenue. Despite the shock over Magnitsky’s death, this November the Interior Ministry awarded those same officers medals for exceptional service. Earlier, an investigative committee had found that Magnitsky himself was party to stealing that money. This after Medvedev pledged to punish those responsible for Magnitsky’s death.

This is at the core of Putin’s image as a salty man of the people who speaks his mind: He does things his way, and, when his way is challenged, he will contemptuously, insolently, flip the world and his subjects a giant, brazen bird. Thus his Foreign Ministry told foreign leaders — like U.S. Secretary of State Hillary Clinton and German chancellor Angela Merkel, who issued flabbergasted statements criticizing the Khodorkovsky conviction — to “mind [their] own business, both at home and abroad.”

To many, it is reminiscent of the behavior of street thugs (of which Putin was one until he tried to join the KGB and was told to first go to college) or of the gulag barracks: Any sign of compromise is weakness, and any sign of weakness starts the countdown to your demise. How do you show strength and leadership in today’s Russia? Be brazen, be rude, be ruthless.

“It is unaccountability par excellence,” says political analyst Masha Lipman, of the Carnegie Moscow Center. “You can do whatever you want because you’re the man of the house. And even when the action seems to be beyond the pale” — say, postponing the hotly awaited Khodorkovsky verdict with a note on the door — “they seem to say, ‘You’ll eat it, and you’ll like it.'” This is what’s known in Russia as the Churov rule, named after Vladimir Churov, an eccentric old man doggedly loyal to Putin and known to his employees at the Russian Central Election Committee as “Grandpa.” “Putin is always right,” he told an interviewer in 2007. And if he’s wrong? Churov replied: “Can Putin really be wrong?”

The Verdict Is In [FP]

Race Riots in Russia

Thursday, December 16th, 2010

Wednesday was shaping up to be a day of excitement in Moscow. But the verdict expected in the second trial of the jailed oil magnate Mikhail Khodorkovsky (whom David Remnick writes about in the current issue) was postponed; an unceremonious note taped to the courthouse door announced the delay. Meanwhile, across the ice-clogged Moscow River, a gathering army of police was bracing for a race riot, the second in four days.

Tensions have been running high here ever since the night of December 6th, when a soccer fan named Egor Sviridov was killed, allegedly by a group of eight men from the Caucasus, a region between the Black and Caspian Seas whose residents are stereotyped much like Italian-Americans once were in the United States: as dark-haired, swarthy, passionate southerners with a taste for organized crime. Their complexions are why Russians call them “black,” or, worse, “blackasses.” When the Soviet Union collapsed, many Caucasians—but also ethnic Russians, Ukrainians, and others—began migrating to Moscow, increasingly the center of commerce and opportunity. The day after the killing, rumors began to circulate that other Caucasians had bribed officials to release the presumptive perpetrators from jail. Sviridov’s fellow soccer fans, enraged at the corrupt police and the alleged Caucasian killers, rioted and closed off one of Moscow’s biggest thoroughfares. The police arrested no one.

Then, on Saturday, seven thousand “real guys”—a combination of soccer hooligans, nationalists, and run-of-the-mill hoodlums—gathered, ostensibly to protest the murder of Sviridov. (Spartak, the team that Sviridov rooted for, announced its refusal to participate, whereas nationalist groups eagerly stepped in to help organize.) The mob screamed, “Russia for Russians!,” spray-painted swastikas and phrases like “Yids, get out of Russia!” and threw flares, bottles, and metal guardrails. Anyone on the streets who didn’t look Slavic got attacked. Then some of the thugs descended into the Metro, and, screaming “white car!” dragged Caucasians and Central Asians from the trains and beat them unconscious as policemen looked on helplessly. (Trains eventually started passing through the overtaken stations without opening their doors. Watch the horrifying footage.) One person was killed, and dozens were wounded.

Saturday’s pogrom was such a jaw-slackening display that the Russian President appeared on national TV and declare that “such actions threaten the stability of the state.” For the next few days, the number of hate crimes spiked, there was talk that migrants from the Caucasus and Central Asia would stage a retaliatory riot Wednesday night on Kievskaya Square—right by my apartment, as it happens. Special forces and armored personnel carriers started gathering in the fifteen-degree cold on Tuesday.

On Wednesday evening, there were already three thousand special forces, Interior Ministry soldiers in green camouflage, and plainclothes officers. Generals in lamb-wool hats directed troops armed with helmets, clubs, and riot shields. Buses idled, waiting to transport would-be marauders. Kiosks and flower shops around the square shut down; most of their shopkeepers are “blacks.”

About a thousand Russian teenagers turned out to face off against a handful of Caucasian kids. Many of the Russians who gathered were girls decked out in their cutest pink pants and Uggs. If it weren’t for the special forces and the teens’ shouts of “Russia for Russians!” it could have been a Justin Bieber concert.

It was hard to take the protest seriously, especially when the kids shouting “Moscow for Muscovites!” turned out to be from outside the city. But this, the festive farce that followed Saturday’s tragedy, had unsettling moments. Like Saturday’s rioters, some of the Russian youths wore ski masks or surgical masks and, when asked, said they were here to “kill khachi,” or some other Russian equivalent of the N-word. One especially youthful-looking boy named Nikita (who said he was seventeen) said he was here to get the “blacks” because “they cut our guys and fuck our women.” A fourteen-year-old named Lesha, who also came to do his part in driving non-Russians from Russia, explained that he heard similar sentiments at home. “My dad supports me in everything,” he said.

The disturbances were not limited to Kievskaya; more than thirteen hundred people were detained in clashes around the city. Police also seized a nice stash of pistols, crowbars, hammers, and even an axe. Moscow went to bed with nary a word from its officials. Mayor Sergei Sobyanin was silent, and President Dmitry Medvedev said on Twitter: “The police behaved professionally. They deserve a rest. And you should rest, too. Good night.”

As for why this happened, there is, as always, the shadow of the Soviet Union. The vast multi-ethnic empire both emphasized and glossed over ethnic differences, without much discussion. Surveys indicate that about half of Moscow’s population is sympathetic with the calls for “Moscow for Muscovites.” “Moscow’s never been very hospitable to newcomers,” says Alexandr Verkhovsky, who runs the Sova Center, which tracks xenophobia in Russia.

A million young Russian men have rotated through the Caucasus during their compulsory military service, either in the wars in Chechnya or in the current counterinsurgency. When they return home, they often enter law enforcement and are expected to protect people who look like the ones they had just fought. “These were not citizens of your country but your enemy on the battlefield,” says Masha Lipman, an analyst at the Moscow Carnegie Center. Which may explain why much of Russia’s law enforcement sympathizes with the rioters. And, as Charles Clover of the Financial Times explained, Russia has the largest and most violent population of skinheads in Europe, and law enforcement, for fear of their strength, has taken to co-opting these extremists, protecting them, even giving them financial support.

Oleg Kashin, a journalist who covered youth movements for the Russian daily Kommersant, told me, “These nationalistic organizations are shot through with police and are well-controlled by the FSB,” the successor to the KGB. Kashin spoke from his hospital bed where he was recovering from a savage beating for which some have—implausibly—blamed soccer hooligans. “When something of this size is planned, the Interior Ministry knows in advance exactly when and where it will happen. There are enough rats in these organizations.”

They didn’t even need that: in the leadup to the recent violence, all the information they needed was widely available on the Internet. “The police reacted improperly on Saturday,” says Verkhovsky, the xenophobia expert. Had they blocked off the square where the riots took place, had they sent out enough people and rounded up instigators, the situation, Verkhovsky says, would have been like Wednesday night: a few sporadic fights and a lot of teenagers looking for a rush of adrenaline.

After a week of silence, Prime Minister Vladimir Putin finally addressed the issue this afternoon in a televised question-and-answer marathon with the Russian public. He said that Russia has always been a multi-ethnic state and this kind of violence was out of line. “We are all children of one motherland,” he said sternly. But he did quibble with those who blamed law enforcement. If they criticize the hard work of the police—whom a full sixty per cent of the Russian population don’t trust—he suggested that “liberals shave their little beards, put on helmets and get out into the square to fight the radicals.” In other words, if you don’t understand the seriousness of the task before us, keep your mouth shut.

Race Riots in Russia [TNY]

The Wheels of Injustice Grind Slowly

Wednesday, December 15th, 2010

MOSCOW — When journalists showed up to hear the judge read the long-awaited verdict in the case of jailed oil tycoon Mikhail Khodorkovsky, they found a note on the courthouse door. The reading of the verdict, it said, would be postponed. It was still early in the morning, though, and the note — unsigned and typewritten — seemed like it could easily be fake. This was, after all, the denouement of a highly politicized, hyper-publicized trial, both in Russia and abroad. So one of the puzzled journalists called Khodorkovsky’s lawyer, Genrikh Padva, who had not yet heard of the note’s existence. “I might have expected this,” he said. “But no one warned me about it ahead of time.”

By the time Padva got to the courthouse, there was a scrum of reporters and elderly Khodorkovsky supporters by the door. They swarmed him, demanding an explanation. “Apparently the court just didn’t have enough time to write the verdict,” the lawyer explained. He also had not gotten an official explanation (just an official version of the note on the door) but Padva and the rest of the legal team tried to play it down. This happens all the time, they said. Only Khodorkovsky’s father, Boris, had a more probing — and Russian — explanation: After the delay, he said, “a lot fewer people will come” for the actual verdict.

The date was April 27, 2005.

Five and a half years later, on December 15, journalists awaited another Khodorkovsky verdict; the scene was almost identical, with a few names and details changed around. It was a different Moscow courthouse and a different case in question, this one brought in 2007 when Khodorkovsky and his partner Platon Lebedev were just about to be up for parole. The new charges alleged that the two stole all the oil their company Yukos ever produced and then laundered the ill-begotten proceeds. (The first case was that they neglected to pay taxes on this laundered oil money. The apparent contradiction between these two cases has yet to be explained.)

Just as in 2005, a mass of journalists and supporters arrived early in the morning (this one sub-zero) to get seats in the courtroom. And once again, they found an unsigned, typewritten note taped to the courtroom door, informing them that the verdict would now be read on Dec. 27, when most of them — and most of the people watching and reading about the case abroad — would be away on winter vacation. And, as before, the lead lawyer (now Vadim Klyuvgant), expressed a weary frustration: “I just heard there’s a piece of paper hanging there, with no explanation, not even to me,” he said in a phone conversation on his way to court, “This is not the most unexpected scenario.”

There was no explanation from the court this time, either, and Khodorkovsky’s legal team attributed the delay, once again, to a procrastinating judge. “The judge didn’t have enough time to finish writing the decision,” Klyuvgant said later. “What can I say?” He and his team refused to speculate on just why a judge who had six weeks to prepare a decision appears more like a stressed college sophomore who sends a twelfth-hour pleading email to his professor about computer problems. “I’m an attorney! Stop asking me provocative questions!” Klyuvgant barked when pressed.

This left the explanation, once again, to Khodorkovsky’s parents. This time, it was his mother, Marina, who broke it down. “This was all done on purpose,” she told reporters. “Many journalists and politicians planned to come to court. And when you move everything close to New Year’s, everyone will be gone.”

She has a point. A verdict in a Russian court is not a quick, decisive paragraph, but a lengthy rehashing of the entire trial, as well as a delivery of the sentencing. The ruling is not clear until the end, though delivering a verdict can take weeks of deadly, monotonous reading from the bench. (At a press conference yesterday, Klyuvgant noted that the judge, Viktor Danilkin, is “a professional.” That is, he reads really, really fast, “almost like a tongue-twister.”) Given that the decision in this case — as in the first one — has long ago been decided in the Kremlin rather than within the courthouse walls, it’s strange that Danilkin would need extra time to finish writing a pre-decided decision.

What Danilkin really needs is time for the people who are interested in reporting and reading about his pre-fab verdict to be less interested, like when they are skiing in the Alps or sunbathing in Thailand or getting chronically drunk over the holidays. (When the first verdict was postponed, the Kremlin needed time to host foreign leaders like George W. Bush for the 60th anniversary of the victory over Nazi Germany. Why give the foreigners cause to complain on such a sacred day?) People are already starting to leave Moscow for the winter break, and many of them won’t return until the country gets back to full-time mode on January 10. By then, they’ll come back to find that nothing’s changed — that Khodorkovsky is, as always, guilty in perpetuity. And if there was any question on that matter, there are rumors circulating that there is a third set of charges being prepared.

If any more proof were needed that justice and politics in Russia is all form and no content, it came in today’s statement from the court’s spokeswoman, Natalia Vasilieva. Someone asked her for an explanation and, unintentionally echoing Duma speaker Boris Gryzlov’s infamous quote that the Russian parliament “is not a place for discussion,” Vasilieva answered with a familiar herniation of the state’s disdainful subconscious. “The court does not explain itself,” she said outside the courthouse, and quickly ducked back inside.

The Wheels of Injustice Grind Slowly [FP]

Berlusconi and Putin Pillow Talk

Thursday, December 2nd, 2010

When Vladimir Putin blasted the Obama administration on Larry King Live yesterday, he was posturing, letting Obama know that a “reset” and a red button won’t make them buddies. It was a stark reminder that Putin still does business—both political and economic—the old way: through personal friendships.

What camaraderie with Putin entails can now be easily gleaned from the fresh bash of diplomatic cables released by WikiLeaks. One cable especially, apparently sent to Washington last year from the embassy in Rome, reveals the Berlusconi—Putin definition of Paesano. The decade-old connection thrives on the personal chemistry between the two politicians but also on billions of dollars in energy contracts, helped along by “lavish gifts” and a “shadowy” intermediary, who has helped keep the money flowing between the two countries, according to the cables as well as political observers.
“I think it’s interesting that Russia and Italy have this strangely close relationship,” says Alexander Kliment, a Russia analyst with the Eurasia Group. “And I think it has to do with three things: One is the personal connection between the two leaders; two, energy deals and banking, and three, thesimilarity in political cultures.” As Kliment describes it, it’s an “extremely personalized” way of doing politics and business, often as a way around the extreme bureaucratization of society.

So how close are Putin and Berlusconi? In a word: Very. The most recently released cables portray Berlusconi as a man desperate for the lasting friendship of Putin, who seems a bit more cautious. “Berlusconi admires Putin’s macho, decisive, and authoritarian governing style, which the Italian PM believes matches his own,” writes the author of one diplomatic cable, adding that Berlusconi sees a fellow “tycoon” in Putin—a strange categorization for a man who, last year, claims he made just $120,000. (Unofficially, Putin is thought to be one of the richest men in the world.) “From the Russian side, it appears that Putin has devoted much energy to developing Berlusconi’s trust,” notes the cable. According to the cables, it is energy well spent: Berlusconi is shown repeatedly flouting his NATO and E.U. obligations in order to press Putin’s interests in the region.

It is a relationship that goes back to Putin’s arrival at the wheel of the ship of state. For his first foreign trip as president, he decided to go to Italy and, a year later, Berlusconi, who had just been elected (again) to the post as prime minister, flew to Sochi, a resort on the Black Sea. There the two men strolled down the boardwalk, talked of big things (probably), and drank Russian tea. Whatever it was they discussed at their first meeting, it is clear that the connection they forged was far stronger than that which Putin simultaneously built with British Prime Minister Tony Blair or President George W. Bush in those first heady years of his presidency. But whereas their friendships with Putin quickly and fatally unraveled, Silvio and Vlad have seen their relationship go from strength to strength.

By the time Putin joined Berlusconi on his n-th trip to Sardinia, in 2003, they were already on hugging terms. In times of crisis, Berlusconi talked to Putin on the phone daily, and Italian diplomats in Moscow complained that, because of this direct line between the two men, decisions got to them ready-made, with little explanation. Berlusconi was even rumored to be the only foreign leader to have been given the honor of spending the night in the Kremlin. He reciprocated by naming one of his beds “Putin’s Bed,” made famous by some secretly recorded pre-business banter between Silvio and Patrizia the Prostitute. (Putin’s Bed was, of course, the place where the business got done.)

There were other touching moments, too. Last fall, Berlusconi ditched the visiting King of Jordan and, bearing “fine wines,” flew to St. Petersburg to celebrate Putin’s 57th birthday. Their offspring have also been bonding: one summer, Putin’s daughters, Maria and Yekaterina, hung out with Berlusconi’s daughter, the Russian-speaking Barbara, on her father’s yacht and in her father’s nightclubs.
During the last decade, the two men—one young, blonde, and wiry; the other a broad shovel of tanned antique leather—have enjoyed all manner of presidential pastimes. They have, for example, attended extreme fighting events (the eye-gouging kind) together with their other bud, Jean-Claude Van Damme. They have also tested emergency aircraft, yachted together, and holidayed in Berlusconi’s private villa in Costa Smeralda and at Putin’s dacha near the Black Sea. “By our reckoning, Putin has held more bilateral meetings with sitting Italian PMs in the recent past than any other world leader,” quips the cable.

Their favorite activity, however, seems to be holding joint press conferences. At one of their most memorable appearances together, in Moscow, in 2008, a Russian journalist named Natalia Melikova asked Putin about his apparent marital trouble and rumored romance with the young and indecently plastic gymnast-cum-parliamentarian Alina Kabaeva. When asked about the liaison, Putin’s face hardened. “There is not a word of truth in this story,” he said. Berlusconi, giggling, regarded the exchange. When Putin had finished answering, Berlusconi cocked his hands, and, imitating a gun, fired with a silent “Pow! Pow!” at Melikova. It had only been a year and a half since Anna Politkovskaya, an investigative journalist, had been shot in her Moscow elevator, and Melikova was reduced to tears. On the dais, Berlusconi laughed, and Putin nodded.

Somewhere near the nexus of the Berlusconi and Putin relationship is a 48-year-old former translator named Valentino Valentini, from Bologna, described in one the cables as a “shadowy figure.” Valentini, according to one cable, is “Berluscon’s [sic] key man on Russia, albeit with no staff or even a secretary.”

Now a lawmaker from Berlusconi’s People of Freedom Party, Valentini has served as the prime minister’s foreign policy advisor since 2001. “Valentini, a Russian-speaker who travels to Russia several times per month, frequently appears at Berlusconi’s side when he meets other world leaders,” says the cable. “What he does in Moscow during his frequent visits is unclear but he is widely rumored to be looking after Berlusconi’s business interests in Russia.”

And those appear to be extensive. As the relationship between Putin and Berlusconi has blossomed, so have the shared business interests of their respective countries. There is, for example, the southern Russian city of Lipestk, a special economic zone, which is dominated almost entirely by Italian companies. “The bureaucrats down there even speak Italian!” says Russian parliamentarian Sergei Markov.

Italian banking and finance in Russia has also grown considerably in recent years. The biggest Italian bank in the country, UniCredit, alone has over $17 billion in Russian assets. There is now talk of a Russian entry into the sacrosanct Italian telecom sector, particularly a buy-in to Mediaset, the ailing media company Berlusconi founded in the 1970s.

And Italy’s gain has sometimes been America’s loss.

“Back in 2007, there was an unspoken rule to give American banks here a fight because Americans were seen as anti-Russian,” says Ivan Ivanchenko, who heads investment strategy research at VTB, a major Russian government bank. “Whenever there was a big deal going down, we could give it to the global franchises, but not the Americans.” The Italians, he says, were often the beneficiaries of this informal embargo.

Critics of the closely aligned business interests of Russia and Italy also point to the case of Alexei Golubovich, an executive of Yukos–the company of jailed oil tycoon Mikhail Kodorkovsky. Golubovich was seized and placed under house arrest in Rome in 2006. According to sources familiar with the case, the arrest came “with a phone call. No warrant, no court, nothing.” A year later, with Khodorkovsky languishing in a Siberian jail, Yukos was dismantled and sold off to Putin-friendly interests. Eni, the Italian energy company with ties to Berlusconi, got one of Yukos’s major gas fields. They were the only foreign company to get such a plum prize.

In 2006, after the Russian state-owned gas behemoth Gazprom, had begun to build two crucial pipelines to fill in the energy vacuum in Europe, Russia needed a partner for the southern branch (called South Stream). It found a perfect collaborator in—you guessed it—the Italian Eni, a company that has a bigger staff in Moscow than the Italian embassy itself. According to the Rome cable, the company funds most of Italy’s think tanks and allegedly has several journalists on its payrolls. And Eni’s director has more access to Berlusconi than the Italian foreign minister. Two years after the deal between the companies had been signed, Eni was singing Gazprom’s tune. “ENI’s view of the European energy situation was disturbingly similar to that of GAZPROM and the Kremlin, and at times laced with rhetorical flourishes reminiscent of Soviet-era double-speak,” says the cable.

Berlusconi’s personal financial interests also appear to be a critical factor in the mix. According to Russian and Italian press reports, when Gazprom set about finding an Italian partner to deliver its gas to Italy, they picked Central Energy Italian Gas Holding, owned mostly by Gazprom’s subsidiaries. One third, however, belonged to one Bruno Mentasti-Granelli, widely believed to be a stand-in for Berlusconi’s financial interests. (The deal was later scuttled by a major outcry, but apparently there is now a quiet effort underway to put it back together with the help of some conveniently located intermediary companies.)

As for the “shadowy” interloper, Valentini tends to pop up whenever there’s an important meeting for Silvio’s interests. Pictures show Valentini hovering uncomfortably close to the participants, scanning the action, sizing people up. When Berlusconi flew to St. Petersburg for Putin’s birthday party, Valentini was the only one to accompany Berlusconi other than some bodyguards and a valet. Why? In the whirl of dancers and booze, said Berlusconi aids, the two pals had some energy deals to discuss. Said Putin’s spokesman, “I can’t exclude that they certainly will be somehow celebrating his birthday, but it’s not the main reason for the visit.”

Berlusconi and Putin Pillow Talk [The Daily Beast]

Putin and the King

Thursday, December 2nd, 2010

Last night, Russian Prime Minister Vladimir Putin put in his second appearance on “Larry King Live,” via satellite link from Moscow. Going back and watching the first one, shot in the New York studio in September 2000, is a bit like beholding the youthfulness of an early episode of “Seinfeld” or “The Sopranos.” It had only been a few months—one summer—since Putin had been inaugurated as Russia’s second president, and few people knew who he was or what to expect from him. It seemed he didn’t, either. The presidency was not something he had wanted back then, and, like everything at Larry’s table, it showed. Putin was quiet, slim, hesitant. He had not mastered the politician’s art of eye contact; he looked down and sideways, like the skittish K.G.B. guy he was. “Are you enjoying it?” Larry King asked, speaking of his new role. Putin took a breath, raised his eyebrows and said, “Somewhat.”
More than ten years later, Putin is a different man (and the show is a different show; this would be King’s final softball interview with a world leader before ending his run this month). Power, it turned out, suits Putin. His face may be wider and his hairline that much closer to the horizon, but he relishes the camera’s attention. Gone are the clipped phrases (like the infamous “It sank,” his comment, on his first King appearance, on the Kursk nuclear submarine disaster, in which a hundred and eighteen people had been killed), gone is the floridly boring bureaucratese; gone is the shyness, the evasiveness, even the aggression of the middle years of his presidency. He has learned how to answer only his own questions while pretending that he is giving it to you—or Larry—straight.
This is the Putin Moscow has seen in public appearances lately. Now that he’s created a legend of stability, order, and a country brought to heel (legend because, in addition to pervasive corruption and criminality, the WikiLeaks cables observed that many of his edicts are lost in the bureaucratic wilderness), now that state TV trumpets his triumphs, he is a man who feels totally at ease in a medium he has mastered (in part by muzzling it). He banters and jokes, he fires off some viciously funny barbs. Speaking of Defense Secretary Robert Gates’s assertion, in an American diplomatic cable released by WikiLeaks, that democracy in Russia had disappeared, Putin laughed and said: “I know Mr. Gates. I met him several times. I believe he’s a very nice person and he is not a bad expert, too.” Then he noted that Gates was once the head of the C.I.A. “Now, if he’s the best expert in democracy in the United States of America, then I congratulate you with that.” Putin seems to like being thought of as Batman.
That brings us to the man described, in the WikiLeaks cables, as Putin’s “Robin.” For the last two years, Russia’s putative president, and the man Obama has to deal with, has been Dmitry Medvedev, while Putin has been in the supposedly lesser role of prime minister. Medvedev, the young tech geek, has been trotted out as an investor-friendly dressing for Russia’s West-facing window. Everyone at home—and, as it turns out, in diplomatic circles—knows that Putin is the man in charge. When Larry King asked him if he would, as widely speculated, retake de jure control of the country in 2012, Putin gave a suitably non-committal answer. Sources in Moscow say that Putin has yet to decide himself, but by recording the Larry King interview on the same day that Medvedev gave a bland and ineffective state of the union to a sleepy room of graying bureaucrats, by addressing himself to “the American people,” and suggesting that they could expect a tougher, less reset-happy Russia, Putin seemed to signal something, not least to himself.
One of the diplomatic cables made public by WikiLeaks show a Putin who “resents or resists” his workload as prime minister. “Putin did not like coming to the Russian White House [where the prime minister’s office is located], where he was confronted with stacks of papers on issues of minuscule importance, on which he did not want to expend his energy,” the cable said. In a top-down system, this has created a bottleneck as people wait for a signal from above. But Putin, who often works from home, is not interested. He is, it seems, in early retirement, and bored. He gets all the actual work of running the country – a nasty by-product of paranoia and centralization – without the pomp and circumstance, and eagerly awaited appearances on foreign TV, of the presidency.
Perhaps to alleviate the boredom, Putin has been waging a P.R. campaign all summer. He piloted a waterbombing plane to put out raging forest fires, then installed Web cameras to monitor the rebuilding effort; he drove along a new stretch of highway in the Russian Far East in a Russian-made automobile (which promptly broke down) and in a Formula 1 car at a hundred and fifty miles per hour; he rode with a pack of Ukrainian bikers. “He has acquired a fine sense of what works,” his former chief of staff Alexander Voloshin told me. The Larry King appearance was another way for Putin to stay in the public eye, but on an international level.
And, despite a literal synchronous translation that sounded like a Google Translate filter superimposed on the Prime Minister’s mouth (“one gender marriages will not give you offsprings”), Putin spoke firmly and directly about NATO, Iran, and Afghanistan; Obama and Bush; his daughters’ privacy (“to put them through the public lighter is not what I think is right”); Russia’s controversial bid to host the World Cup in 2018 (which Russia just won); and, strangely, about Larry himself.
PUTIN: Can I ask you one question?
KING: Sure.
PUTIN: I don’t know why, but the king leaves the scene the U.S. stage.
KING: I sometimes don’t know why myself.
PUTIN: In the U.S. mass media there are many talented and interesting people, but still there is just one king there. I don’t ask why he is leaving, but still what do you think? When shall we have a right to cry out, “Long live the king”? When will there be another man who is as popular in the whole world as you happen to be?
KING: Thank you, thank you, I have no answer. Vladimir Putin, Prime Minister of Russia. Tomorrow night, the former heavyweight champion of the world, Mike Tyson.
It was an awkward bit of projection, a strange way of saying that he, Putin, misses his throne.

Putin and the King [TNY]

The Cheating Cheaters of Moscow

Wednesday, December 1st, 2010

One evening in Moscow, Tanya (not her real name) found herself at a dinner table with a group of friends, most of them married couples. One of the men started to tell a story about the coda to a recent guys’ night out. He’d stumbled home the next morning to his wife and two children—a 2-year-old and an infant—to find that he’d forgotten his underwear. Everyone at the dinner table, including the man’s wife, laughed at the story: the hijinks!

Wandering spouses have become a common trope for the women of Moscow. “Men’s environment here pushes them towards cheating,” Tanya told me, adding that, these days, a boys’ night out in Russia often involves prostitutes. Tanya and her friends are young, educated, upper-middle-class Muscovites, but talk to any woman in Moscow, and, regardless of age, education, or income level, she’ll have a story of anything from petty infidelity to a parallel family that has existed for decades. Infidelity in Moscow has become “a way of life,” as another friend of mine put it—accepted and even expected.

This is quite a shift, given that 20 years ago an affair was considered a career-wrecking scandal. But by 1998, a study showed that Russian men and women led their peers in 24 other countries in their willingness to engage in and approve of extramarital affairs. Since then, these attitudes have taken hold more deeply after a prolonged consumer boom that encourages Russians to indulge their whims and desires. What does this culture of infidelity look like, and what are the costs?

Any explanation begins with a basic cultural difference. When Christianity arrived here, in the 10th century, it landed in a peasant, agrarian culture that treated sex as a natural barnyard phenomenon. Russia’s expanse was notoriously hard for the already disorganized church to govern, and so, when it came to sex, a sort of dichotomy of word and deed persisted well into the 19th century, more than in the West. Then came the Bolshevik Revolution, which rooted out the church and replaced it with a prudish, asexual model for behavior. Sex, once viewed as natural if vaguely sinful, ceased to exist altogether: “There is no sex in the Soviet Union,” the saying went. Parents stopped having the birds-and-bees talk with their children, and men could be dragged in front of their local Party Committee or labor union and made to suffer professionally for infidelity.

But this was not a deeply entrenched new morality; it was a code of behavior that did not convincingly explain itself. Communist ideology—a political and economic view of the world—was not a good stand-in either. Why was sex a taboo topic for socialist citizens? Why was cheating on your wife amoral if Communism rejected traditional bourgeois norms? The Soviets answered only with prohibitions and contradictory rhetoric. Outwardly, the prudishness held into the late Soviet era: Sex remained a shameful, tasteless topic, and it was impossible for girls to buy condoms in stores. (This was when abortion was the most common form of birth control.) At the same time, studies showed that Soviets were having sex earlier, getting married later, and doing all the other things their Western, sexually liberated counterparts were doing, but without the debate to make sense of it. It was, once again, a new set of behaviors devoid of moral explanation.

This was the perfectly explosive mix that greeted the overnight arrival of market capitalism and the oil boom of the last decade. Suddenly, there was no one to forbid anything or to admonish anyone. Everything that could be had, was; one needed only the will to acquire it. All of this has thrown Moscow into a consumer-driven hedonism that would make an American mall rat blush. Everything is available and everything is for sale. Sex is just another pleasure product, like a bottle of Moet. A recent Russian movie, What Men Talk About, featured four middle-age men on a road trip discussing the burdens of married life and the pleasures—the necessity, even—of infidelity. “Why can’t she understand that sex with my beloved, and sex with some other woman are two completely different activities,” one of the men says, comparing the latter to sneaking baloney from the fridge in the middle of the night. The film was, of course, a hit.

As the movie showed, the liberation is more for men than for women. For all its modernity, Moscow has been the seat of resurgent Russian paternalism since the arrival of Putin and his conservative nationalist agenda. Since men are the ones carving up the pie and doling out the slices, the way to show you have lots of pie is to be able to afford (wine and dine, regale with gifts) more than one woman. A 30-year-old Muscovite named Lena told me that certain social circles don’t accept her male banker friends if they don’t have mistresses. “It’s like having a Mercedes E Class,” Lena explained. “If you can’t measure up, if you can’t afford it, you aren’t welcomed. It’s easier, I guess, when you have common interests.” One middle-aged Muscovite who runs a successful business recently told me, “I don’t know, maybe I’m a complete fool for not having a mistress like everyone else.”

For the most part, Russian women shrug off the fooling around. It’s seen as unavoidable and natural. Men are slaves to hormones. Why get worked up over that, or the weather? “My sister’s husband cheats on her,” says Tanya, of the underwear story. “She knows this for a fact, but she doesn’t cheat on him. When I ask her why she stays with him she says, ‘I’m going to split up with him over some nonsense? He’ll get it out of his system and settle down.'” “Faithfulness in marriage is seen as something that is nice but unrealistic,” says Moscow sociologist Irina Tartakovskaya. She points out that if women don’t really expect it of their husbands, they can pre-empt feelings of shock and betrayal.

Women also put up with infidelity because there are simply more of them. Since World War II, when the Soviets lost 27 million people, there have been real or perceived shortages of men in Russia, who have one of the lowest life expectancies in the developed and developing worlds—age 62, compared with 78 in the United States. There are nearly 10 percent fewer men than women here between the ages of 15 and 64. In the aftermath of World War II, a single man could father children with multiple women because it was the only way for many women to start families. Sixty-five years later, even perfectly sculpted Russian women talk about the fierce competition for a mate. (This is also how they explain why they are always dressed to the nines.) “Men are not afraid to lose their women here,” a 23-year-old Muscovite named Olga told me. “But for a woman, who the hell knows if you’ll ever find another one?” This recalls a Billie Holiday-esque traditional Russian women’s saying, “He may be bad, but he’s mine.”

Accepting infidelity doesn’t neutralize the harm it can do, however. Three of my Russian girlfriends, all attractive women under 30, are caught up in the attendant misery. One friend has a boyfriend who has lived with her but vacationed with his wife and kids for years. When she first found out he was married, he proposed divorcing his wife and marrying her. He didn’t do it. When she brought up the subject, he said he’d been joking. Years later, she has given up on kicking him out or fighting with him. “I don’t even know what I want anymore,” she told me. Another friend dated a man for months who said he was single. When she discovered he was married, he too said he’d get a divorce. This time, the guy meant it, but my friend soon found out that he was getting remarried in two days’ time to a different woman. She went on seeing him for months, including on his wedding night. I have my own tale: I was once propositioned by a newlywed man with a 6-month-old child. When I protested that I was not a home wrecker, he reassured me that his home wouldn’t be wrecked, whatever we did together. (I refused.)

Tanya, for her part, couldn’t take the knowledge that her husband was cheating on her. She divorced him even though she is 30 and has a child, which makes a woman essentially unmarriageable in Russia. Lena has taken a more subtle and typical approach. She’d asked her boyfriend at the start of their relationship if he had other women. He’d said no and ardently pursued her. Then she found out he was married and had two children. Instead of breaking up with him, though, Lena decided to “turn the tables,” as she puts it, by holding him at arm’s length but not cutting him off entirely. “There is a reason I’m having this experience, and I will obviously be able to learn from it,” Lena says. “So I have decided that I am not his lover. He is my lover.” He still talks about marrying her. When he does, she just shows him where she has changed his name in her phone to “Traitor.”

The Cheating Cheaters of Moscow [Double X]