RUSSIA - The Oligarchy

Yeltsin's appointment of Kiriyenko and promotion of Nemtsov and Chubais angered most of the dozen or so corporate and banking tycoons, called oligarchs or "robber barons", whose empires were created after Chernomyrdin took the premiership in late 1992. Although some of them kept close to Chubais, all were opposed to the way Kiriyenko tried to apply reforms. With auto, oil and airline magnate Boris Berezovsky acting as their chief spokesman, they worked behind the scenes on getting Chernomyrdin back to power.

In the week before his Aug. 23 appointment, Chernomyrdin met repeatedly with Yumashev as Berezovsky shuttled between the Kremlin and the various power centres of the oligarghy. Both Yumashev and Yeltsin's daughter, Tatiana Dyachenko, the key gatekeepers for access to the president, had kept close to Berezovsky and for months had discussed with him the possibility of Chernomyrdin's return. According to an APS source, Chernomyrdin was negotiating with Yumashev from "a position of strength". The Kremlin chief of staff "had become convinced that no one other than Chernomyrdin could replace Kiriyenko". So "Chernomyrdin insisted on extra powers and the condition that

Yeltsin not interfere with the work of his cabinet". Moscow Echo radio confirmed this in the night of Aug. 23 as it reported that Chernomyrdin demanded "total personal control over the nomination of all members of the (new) government, and no interference by the president in the work of the government".

Another Chernomyrdin condition, according to the APS source, was that Yeltsin back him openly as his political heir. This Yeltsin did in a TV address on Aug. 24, as he said the new premier had the "experience and weight" needed to help Russia overcome the crisis and ensure "the continuity of authority in the year 2000". Yeltsin added: "The principal merits of Victor Stepanovich are integrity, honesty and sturdiness. I think these qualities will become the decisive argument in the presidential elections". To justify his reinstatement of Chernomyrdin, Yeltsin also said: "five months ago, no one expected the world financial crisis to hit Russia so hard, no one expected the economic situation in Russia to become so complex. In these circumstances, the key priority is to prevent sliding back to ensure stability".

On the same day the US administration confirmed that President Clinton would still go ahead with a visit to Moscow on Sept. 1. It is interesting to see how the Kremlin would stage-manage the meeting between the two presidents, both facing calls to step down but for different reasons.