No. 1232 November 6, 1998 WHO’S WHO IN PRIMAKOV’S NEW RUSSIAN GOVERNMENT

EVGUENI VOLK, PH.D.

On September 11, 1998, the Russian State THE PRIMAKOV GOVERNMENT Duma approved President ’s choice of Evgeny Primakov as Prime Minister by a vote of Primakov and most of his Cabinet officials built 317 out of 450. The Duma’s action came in the their political careers in the former Communist regime. wake of the August 17 devaluation of the ruble, Produced by the dismissal of former Prime Minister Sergei A former senior Commu- The Kathryn and Shelby Kiriyenko and his government, and the Duma’s nist Party of the Soviet Cullom Davis International failure to approve Yeltsin’s choice of Viktor Cher- Union (CPSU) nomenkla- Studies Center nomyrdin. tura member and former member of the CPSU’s rul- Published by Primakov used his first month in office to shape ing body, the , he The Heritage Foundation his new government and draft the semblance of a managed to survive when 214 Massachusetts Ave., N.E. crisis management program to address the coun- President Boris Yeltsin took Washington, D.C. 20002–4999 try’s serious financial problems. His choices prove over. He was appointed head of the Russian foreign (202) 546-4400 him to be a master of compromise: His Cabinet intelligence service in 1991. http://www.heritage.org members represent every major political faction in and became Foreign Minis- the Duma, and his economic proposals are ter in January 1996. designed to please both the left and the right. Primakov has challenged Primakov is wary of the and has America’s global leadership been a consistent opponent of U.S. international role by promoting “multipo- leadership. During the recent missile crisis with larity” and opposing NATO Iraq, for example, he resisted U.S. military retalia- enlargement. Yet he is too pragmatic to allow Rus- tion against Saddam Hussein. Exactly how Prima- sian–U.S. relations to deteriorate dramatically. He kov’s government will affect U.S.–Russian relations might even pressure the into ratifying may be uncertain, but its policies clearly could the START II Treaty, believing it to be in ’s have a major impact on U.S. national interests. national interest. But this would not signal an end No. 1232 November 6, 1998

to Russia’s flirtation with anti-American regimes. mander of Russia’s , has retained his ministerial portfolio. A professional Most of Primakov’s deputies were high-ranking military man, he has launched serious military CPSU officials in the 1970s and 1980s when the reforms which have encountered strong resistance U.S.S.R. was suffering economic decline. They from the generals. represent a generation of Russian history plagued by stagnation and economic morass, and are CONCLUSION unlikely to adjust their economic philosophies to the reality of a developing market. Primakov’s Cabinet selected may have been spe- First Deputy Premier Yuri Maslyukov, the top cifically to avoid alienating influential political and Deputy Prime Minister and the government’s chief economic groups, such as international financial economic executive, built his career largely within institutions and the powerful oligarchs. It may also the huge Soviet military–industrial complex. be the political base to launch a Primakov for Maslyukov will supervise macroeconomics, the resident campaign in the near future. Overall, military–industrial complex, and the arms trade. Primakov’s government is more likely to restrict He is Russia’s chief representative for talks with the economic freedom and strengthen its involvement International Monetary Fund (IMF), despite his in the economic system than to concentrate on Communist background and lack of experience in opening markets and increasing their competitive- negotiating financial issues. His counterparts are ness. unlikely to give him much credence. But failure to pursue free-market reforms could Deputy Premier Gennady Kulik is in charge of aggravate the social and economic situation within agriculture. A Communist-allied Agrarian Party the Russian Federation. Separatist tendencies member, he was a CPSU apparatchik. He opposes could increase, hastening Russia’s dissolution into private ownership of land and will pursue protec- poorly governed regions and jeopardizing the tionist policies to shield the agricultural sector centralized command and control of nuclear from foreign competition, which could mean an weapons, making them easy prey for unpredict- end to chicken imports from the United States. able local leaders, criminals, or terrorist groups. Finance Minister Mikhail Zadornov seems as The proliferation of weapons of mass destruction foreign to Primakov’s government as do his politi- could expand even more rapidly than feared. Any cal record and views on economic policy. He never such developments would seriously affect U.S. held a significant position in the Soviet nomenkla- national interests. tura. In 1990, he coauthored a free-market reform Washington should make it clear that it will program rejected by CPSU conservatives. Zador- help Russia through its current difficulties only if nov is likely to proceed with financial reform, but Primakov’s government demonstrates its commit- his freedom to maneuver will be restricted, and he ment to free-market and democratic reforms. It will be subject to pressures from First Deputy Pre- also should insist that Russia’s government con- mier Maslyukov. centrate on fighting crime and corruption, con- Foreign Minister Igor Ivanov is a career diplo- tinue legal and court reforms, respect the property mat with no political ambitions. He served at the and rights of American investors, and institute Russian Embassy in Spain and was the Ambassa- tougher measures to ensure nuclear safety and the dor there in later years. He is expected to follow non-proliferation of weapons of mass destruction. Primakov’s concept of foreign policy, rarely making Without such assurances, U.S. relations with independent moves—which will allow Primakov Russia inevitably will be fragile. to mastermind Russia’s foreign policy. —Evgueni Volk, Ph.D., is Coordinator of The Defense Minister Igor Sergeyev, ex-com- Heritage Foundation’s Office. No. 1232 November 6, 1998

WHO’S WHO IN PRIMAKOV’S NEW RUSSIAN GOVERNMENT

EVGUENI VOLK, PH.D.

On September 11, 1998, the Russian State resisted U.S. military retaliation against Saddam Duma (the lower house of parliament) approved Hussein’s regime during the recent missile crisis President Boris Yeltsin’s choice of Evgeny Prima- with Iraq. He also confronted Washington during kov as Prime Minister. The Duma’s action came in the recent crisis over Kos- the turbulent wake of the August 17 devaluation ovo. Because Washington is of the ruble and the dismissal of former Prime uncertain how Primakov’s Produced by The Kathryn and Shelby Minister Sergei Kiriyenko and his government. confirmation as Prime Min- Cullom Davis International After the Duma twice rejected the nomination of ister will affect U.S.–Russian Studies Center , Chernomyrdin’s former relations and how his poli- leftist opposition in the Duma endorsed Prima- cies could affect U.S. Published by kov by a vote of 317 out of a possible 450. national interests, a closer The Heritage Foundation look at the experience and 214 Massachusetts Ave., N.E. Primakov used his first month in office to shape political bent exhibited by Washington, D.C. his new government and draft a crisis management Primakov and by those he 20002–4999 program to address the country’s serious financial has selected to serve with (202) 546-4400 problems. His selections have proven that he is a him in the new government http://www.heritage.org master of compromise: His Cabinet members rep- becomes highly relevant. resent every major political faction in the Duma, and his economic proposals are designed to please PRIMAKOV AS PRIME both the left and the right. Such a coalition may MINISTER: A SHIFT turn out to be the future political base for a presi- TO THE LEFT dential bid by Primakov, should President Yeltsin exit the political scene. But a major question On October 6, on the eve remains: What will the government under Prime of a nationwide anti-government protest organized Minister Primakov do? by trade unions and the Communist Party, Prime Minister Evgeny Primakov addressed the Russian Primakov is not considered a friend of the people on television to outline his new govern- United States. He has been a consistent opponent ment’s top priorities. Among the most critical of U.S. international leadership, for example, and No. 1232 November 6, 1998

objectives he identified were (1) the urgent need to control the production and distribution of hard pay off wage arrears, already in the billions of liquor. In the past, this group was strong enough dollars, to the military, retirees, and government to thwart Primakov’s predecessors from curtailing employees (education and health care are funded its profits and re-imposing strict government regu- from the federal budget), and (2) the need to sup- lation. Primakov’s success in fighting these Russian port the debt-ridden and stagnating regions of bootleggers will be a litmus test of his govern- Russia. To do this, Primakov promised to safe- ment’s viability. guard private bank deposits currently frozen in banks that are on the verge of bankruptcy. At the Primakov’s program portends greater govern- same time, he made it clear that there would be no ment interference in the current economy, slower re-nationalization of property privatized during rates of privatization, and increased protectionism. the reform years, although he did intimate that It indicates that Russia’s economic policy may there might be a need to reconsider the pace of indeed be shifting to the left. privatization. But his promise to pay off wage and pension The new Prime Minister referred to his strategic arrears raises an immediate concern: Where will objective of rehabilitating Russia’s economy. To this the government find the resources to do this when end, his government will encourage domestic its market-oriented predecessors were unable to entrepreneurs to increase production. He also do it in a much more favorable economic environ- plans to mend the hard-hit banking system, erase ment? Primakov’s address offered no clear answer mutual debts accumulated among companies, and to this dilemma, but many independent observers reform the taxation system to stimulate economic believe his government is likely to print more growth. rubles. While this could ease the problem in the short term, it also would lead to runaway inflation. Primakov announced that his government Other economic remedies that Primakov’s intends to make two specific moves: government suggests also imply huge spending, First, the customs service will be instructed to which is hardly affordable unless the government clear imported industrial machinery that Russian increases the money supply. Thus, Russia is companies have acquired, but that has been held headed for a further drop in its gross domestic up because of failure to pay tariffs and value-added product (GDP) as well as runaway inflation. taxes. The equipment is priced at nearly $1 billion. The new government is heavily dependent on The situation of companies shaken by the financial foreign loans. To receive a much-desired Western crisis should improve once this equipment is bailout through the International Monetary Fund installed. (IMF), G–7 countries, and the World Bank, Prima- Second, a state monopoly will be imposed on kov will have to demonstrate—at least on paper— alcohol production. Alcohol will be produced that he intends to adhere to free-market reforms. under government-issued quotas at factories But genuine reform policies are at odds with the whose stock is government-controlled. This views professed by the most influential members measure is expected to increase budget revenues. of his new Cabinet. Most of them have never been Primakov also stressed the need for foreign and involved in implementing genuine reform policies domestic loans, which would help cut the budget in the past, and it is doubtful they will be able to deficit in the 1998 fourth-quarter emergency do so in the new political environment. budget. THE PRIMAKOV GOVERNMENT The establishment of a government monopoly on liquor production challenges the powerful A leader often reflects the character and predicts “vodka mafia,” a group of businessmen, govern- the actions of those that serve under him. Unlike ment officials, and organized criminals who the members of the Kiriyenko government, No. 1232 November 6, 1998

Primakov and most of his Cabinet built impressive Executive decisions are shrouded in secrecy—a political careers in the former Communist regime. practice understandable only within the context of the kind of intelligence operations that Primakov Evgeny Primakov used to oversee—and this has harmed Primakov’s image. Many in the media speculate that restric- Evgeny Primakov, who turned 69 on October tions imposed on the dissemination of official 29, is a former senior Communist Party of the information are designed to cover up a paucity of (CPSU) nomenklatura member with a constructive crisis management strategies. Several background in espionage and propaganda—first observers suspect that Primakov does not want to as Middle East correspondent for the chief Com- make any unpopular moves before the crucial munist daily paper Pravda, and later as director of negotiations with the IMF are complete, perhaps the Institute of International Economics and Inter- hiding his government’s true intentions. The national Relations (known by its Russian acronym Russian media even accuse him of using psycho- of IMEMO), a foreign policy think tank closely logical warfare tactics, such as those the Soviets linked to the CPSU Central Committee’s decision- applied against enemy regions, to deceive the making process. He then served as the Speaker of Russian people about how well the government is the U.S.S.R. Supreme Soviet (parliament) and as a dealing with the economic crisis. foreign policy advisor to former Soviet President . Rumors persist that he main- Primakov’s foreign policy often leans toward tained close connections to the KGB, the Soviet supporting rogue regimes in the Middle East, and intelligence service, throughout his career. his political career is linked to that region. In During the early 1990s, Primakov was a mem- 1990, for example, he was Gorbachev’s special ber of the CPSU’s ruling body, the Politburo. envoy to Iraq, charged with trying to avert the Unlike Gorbachev’s other associates, he managed Desert Storm operation. Today, he counts among to survive when President Boris Yeltsin took over. his personal friends such leaders as Saddam Yeltsin appointed Primakov as head of the Russian Hussein, Hafez-al-Assad, and Yassir Arafat. foreign intelligence service (SVR) in 1991. In that Primakov is wary of the United States and its capacity, he advocated both reintegration of the Western European allies. He does not hesitate to former union under Russia’s aegis and a more challenge U.S. leadership by promoting the anti-Western policy, which has been named “the 1 concept of “multi-polarity” and opposing NATO Primakov Doctrine.” In January 1996, Primakov enlargement. Yet he is too pragmatic to allow became Foreign Minister, supplanting Andrei Russian–U.S. relations to deteriorate dramatically. Kozyrev, who, in a well-orchestrated defamation He might even pressure the State Duma into ratify- campaign, was accused of pro-Western orienta- ing the START II Treaty, believing that such a move tion. is in Russia’s own interest. At the same time, how- As a member of Yeltsin’s government, Primakov ever, Russia’s flirtation with anti-American regimes refrained from openly criticizing free-market across the world can be expected to continue. reforms. However, his sympathies reflect a quasi- socialist approach to government that advocates Primakov’s Domestic Deputies the predominance of state-run property and strong Primakov wields enormous domestic power. He government regulation, not limited government controls Russia’s financial agencies, including the and free enterprise. Finance Ministry, the Federal Taxation Service, the Neither Primakov nor his government seems Tax Police, and the State Customs Committee. He ready to fight the economic crisis gripping Russia. was able to remove from influential positions his

1. See Ariel Cohen, “The ‘Primakov Doctrine’: Russia’s Zero-Sum Game With the United States,” Heritage Foundation F. Y. I . No. 167, December 15, 1997.

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potential rivals, such as Security Council Secretary top Deputy Prime Minister and the government’s Andrei Kokoshin and Presidential Spokesman and chief economic executive. He represents the old Chief Foreign Policy Advisor Sergei Yastrzhemb- system well. His career was made largely within ski. But he is not an expert on the Russian econ- the huge Soviet military–industrial complex that omy, even though that normally is a qualification accounted for between 60 percent and 80 percent for a Russian premier. Consequently, he will have of the Soviet Union’s GDP. He headed the U.S.S.R.’s to rely on his deputies for guidance. State Planning Committee (), which monopolized all economic planning and manage- So far, Primakov has appointed five new ment, defining the type, volume, and prices of deputies: commodities manufactured at every single plant •YYuri Maslyukov, First Deputy Premier respon- and factory across 11 time zones. sible for macroeconomic management and the According to the job description issued by the military–industrial complex; Primakov government, Maslyukov will supervise •VVadim Gustov, First Deputy Premier responsi- the Ministries of Economics, Trade, and Privatiza- ble for regional and local government affairs; tion; the military–industrial complex; and the arms trade. He is Russia’s chief representative for •GGennady Kulik, Deputy Premier responsible talks with international financial organizations. for agriculture; This in itself is a strange appointment, both •VValentina Matviyenko, Deputy Premier for because of his Communist record and because he social security issues; and has no experience in negotiating sensitive financial issues. Maslyukov’s foreign counterparts are •VVladimir Bulgak, Deputy Premier in charge of unlikely to give his positions much credence.2 managing the fuel and energy complex, research and development, and communica- Maslyukov is a classic Soviet apparatchik. It is tions. doubtful that his experience will benefit the Russian economy in the circumstances surround- Most of these deputies were high-ranking Soviet ing the current crisis. His first reported pro- Communist Party officials in the 1970s and 1980s, nouncements favoring an increased money supply when the U.S.S.R. was suffering an economic and restricted ruble convertibility already have decline. They represent a generation of Russian caused concern. These policies would allow him history plagued with stagnation and economic to pour unlimited funds into the military–indus- morass, and it is unlikely that they will be able to trial complex. For example, Maslyukov has called adjust their economic philosophies—formed for expanding the production of high-tech Topol– decades ago within a Communist political and M intercontinental ballistic missiles (ICBMs) by 40 ideological environment—to the realities of a units a year and stepping up manufacturing of developing market. sea-launched ballistic missiles (SLBMs) and new The Primakov government, however, is not strategic nuclear submarines. He harbors the erro- made up solely of old Communists. It is a collec- neous notion that a revival of the Russian military– tion of people with different political orientations, industrial complex will lead to a general surge in ideologies, backgrounds, and goals. To understand industrial output. In truth, it will require colossal how this government will function, and what its funding, which will only aggravate the country’s policies portend for the future of Russia, consider economic depression. Primakov’s principal choices: Maslyukov’s anti-reform views on how to lift First Deputy Premier Yuri Maslyukov, 61, is the Russia from its crisis have disturbed many,

2. See Ariel Cohen and Brett D. Schaefer, “Russia Needs Immediate Reform, Not More IMF Loans,” Heritage Foundation Executive Memorandum No. 533, June 10, 1998.

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including Alexander Shokhin, a liberal economist name is frequently associated with the 1991 Soviet appointed by Primakov as Deputy Premier in confiscatory monetary reform. He resorted to simi- charge of financial issues. Shokhin resigned just lar strategies while serving as head of the Russian ten days after assuming his post, apparently in the Bank in 1993, when he illegally supplied money to belief that he could not reconcile his own eco- the anti-reform forces in the Supreme Soviet. And nomic policies with those of Maslyukov, to whom he is responsible for Black Tuesday in October he reported. 1994, when the value of the ruble (and with it, once again, the savings of the Russian people) fell Finance Minister Mikhail Zadornov of the social 24 percent in one day. Gerashchenko has been democratic Yabloko party also has been highly called “the worst central banker in the world.”5 critical of Maslyukov’s economic platform, which the government finally renounced. After little Gerashchenko favors ruble emission as the more than one month in office, Maslyukov already principal solution to Russia’s fiscal problems. is viewed as a top lobbyist for the military–indus- Inflation does not frighten him; in fact, he has trial complex, instead of as a politician capable of every confidence that it will revive the Russian dealing with Russia’s financial crisis. economy. He may try to hide his intentions, but understand that the appointment of Among Maslyukov’s aides are such anti-market Gerashchenko as head of the Central Bank means economists as Sergei Glaziev, head of the Federa- 3 rapidly increasing inflation and further impover- tion Council Analytical Service and a consistent ishment. It is feared, with some reason, that his opponent of liberal reforms, and Anton Surikov, practices will ruin Russia. an observer for the ultranationalist Zavtra4 weekly paper and a proponent of the restoration of the First Deputy Premier . Although by force. They can be expected to Maslyukov and Gerashchenko personify the have an effect on Maslyukov’s decisions. Communist presence in the current Primakov government, Vadim Gustov, 50, a former Commu- Head of the Central Bank Viktor Gerashchenko. nist apparatchik, represents the regional lobby. A The position of Deputy Premier in charge of finan- former of the Leningrad Region (not to cial issues was eliminated after Shokhin resigned, be confused with the mayor of its capital, St. and its functions were divided among the remain- Petersburg), Gustov will handle federation, ing Deputy Premiers and left-leaning Central Bank regional, and local government affairs. Chairman Viktor Gerashchenko. Gerashchenko’s voice has become critically important in resolving Gustov’s presence in the Cabinet is an attempt Russia’s financial problems; he was the chief to consolidate regional leaders under the federal Russian negotiator at the recent IMF meeting in government and curb their separatist tendencies. Washington, D.C., along with Finance Minister Eight influential governors who chair the “interre- Zadornov. gional associations” that unite several larger regions have been invited by Primakov to join the Gerashchenko was a prominent official in the so-called Presidium of the government. This is the Communist banking system. He worked in the inner circle that makes crucial executive decisions. Moscow-controlled banks in London and Beirut in Thus, the regional lobby’s influence within the the 1960s and 1970s, during the peak of Soviet- federal government will increase significantly. supported espionage and terrorist activity, and later was chairman of the Soviet State Bank. His Deputy Premier Gennady Kulik. The

3. The Russian Parliament’s upper house. 4. A weekly paper known for its chauvinism and anti-Semitism. 5. By Jeffrey Sachs, advisor to the Russian government, quoted in Liam Halligan, Craig Mellow, Brian Caplen, and Rachel Katz, “Russia Comes in from the Cold,” Euromoney, No. 317, September 1995.

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appointment of Gennady Kulik, 63, as Deputy Deputy Premier Vladimir Bulgak, 57, is the least Premier in charge of agriculture is another conces- politically engaged of the Deputy Premiers. He was sion to the left. Kulik, a Communist-allied Agrar- not part of the high-ranking Communist nomen- ian Party member, was a CPSU apparatchik and klatura and is a typical technocrat whose career agricultural minister in the early 1990s. He is was centered in the government’s communications expected to preserve the current agricultural system. system, which is ineffective and based on collec- tive and state farms that have been formally priva- Under Primakov, Bulgak will handle the fuel tized. and energy complex, communications, research and development, nuclear projects, and transport Kulik opposes the private ownership of land issues—a job which demands a great deal of and is expected to pursue protectionist policies to purely technical skill. Since he is a protégé of Boris shield the agricultural sector from foreign compe- Berezovski, a powerful oil, gas, and automobile tition. His first official statement maintained that tycoon, he also will be instrumental in lobbying his chief priority was to revive Russian poultry for Berezovski’s interests. production—which could signal an end to chicken imports from the United States. In light of Finance Minister Mikhail Zadornov. Mikhail this, the type of radical agrarian reform that Russia Zadornov’s age (35), record, and political views so urgently needs is unlikely under Kulik’s seem unusual for a minister in Primakov’s govern- guidance. ment. He has never held a significant position in the Soviet nomenklatura. In early 1990s, together Deputy Premier Valentina Matviyenko, 49, with Yabloko party leader Grigory Yavlinsky, he manages the social safety net that includes educa- authored the liberal reform program known as the tion, labor, culture, pensions, and employment. “500 days” plan, rejected by Gorbachev and CPSU She headed the Leningrad Young Communist conservatives as being too radical and market- League in the 1970s and later served as a deputy oriented. chairman of the Leningrad Executive Committee (the mayor’s office). She headed the Family and Zadornov, a close associate of Yavlinski, was Women’s Issues Committee in the U.S.S.R. elected to the State Duma and chaired the Duma Supreme Soviet in the late 1980s when Primakov Budget and Tax Committee for two terms. Widely was the Speaker. Upon her graduation from the respected as a professional economist, he was Diplomatic Academy, which trains high-level appointed Finance Minister in 1997 and is one of diplomats, she was appointed Ambassador to the few officials who survived the Cabinet shuffles . Her last diplomatic position was as after Chernomyrdin and Kiriyenko left office. He is Ambassador to . expected to proceed with financial reform, but his freedom to maneuver will be restricted. Matviyenko’s political sympathies also lie with the left. In one address, she urged the Education Zadornov will be subject to pressures from First Ministry staff to work under the guidance of the Deputy Premier Maslyukov and Central Bank Communist-dominated State Duma. First Deputy Chairman Gerashchenko. Many predict that he Minister Alexander Asmolov resigned in protest. will be accused of failing to make any meaningful anti-crisis moves and eventually will be dismissed. Matviyenko may find her role as Deputy Premier difficult because the government simply Labor and Social Security Minister Sergei does not have the resources to fund the social Kalashnikov, 47, is another newcomer to the security safety nets. Yet her record indicates that, Primakov government. He is the first representa- under her guidance, the government will seek to tive of Vladimir Zhirinovski’s Liberal Democratic assume as many responsibilities as possible and Party to be appointed to a Russian Cabinet. This is control regulation and distribution to the detri- clearly a political appointment meant to appease ment of private initiatives. Zhirinovski, a vocal opponent of Primakov’s

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premiership. However, unlike other appointees, eign policy issues. Primakov’s choice of a successor Kalashnikov, as a former Chairman of the State in the Foreign Ministry indicates a desire to place Duma Labor and Social Security Policy Commit- loyal people at the head of the national security tee, has a thorough knowledge of the areas he was agencies. appointed to direct. Foreign Minister Igor Ivanov, 51, is a career A psychologist by education, Kalashnikov is diplomat with no political ambitions. Before filling also an experienced business manager and joined the post of First Deputy Foreign Minister, he the Liberal Democrats for career rather than served at the Russian Embassy in Spain and was political reasons. He may be unable to institute his the Ambassador there in later years. He is expected plans in the current economic environment. to follow Primakov’s foreign policy, rarely making independent moves and allowing Primakov to Tax Service Chief Georgy Boos, 35, is another mastermind Russia’s foreign policy. atypical political appointee to Primakov’s left-lean- ing government. This young politician is a mem- Interior Minister , 46, who is on ber of the Our Home Is Russia (OHIR) movement good terms with Primakov, retains his former posi- led by ex-premier Viktor Chernomyrdin. OHIR tion in the new government. Both as Defense and claims to be center-right and sought membership Security Committee Chairman in the Russian in the International Democratic Union (IDU), Supreme Soviet of the early 1990s and as head of which includes as members several Republican Russian counterintelligence, Stepashin had a close members of the U.S. Congress and Conservative working relationship with Primakov. members of the British Parliament. The Interior Ministry has not been successful in Boos was once a prominent businessman its efforts to fight crime and corruption. With his responsible for lighting the streets of Moscow. He record as a former Communist Party political was associated with Moscow Mayor Yuri Luzhkov commissar within the Soviet Interior troops (the before being elected to the State Duma in 1995 Russian counterpart to the U.S. National Guard) and will be an influential lobbyist for Luzhkov in rather than as a professional law enforcement the Primakov government. official, Stepashin will find it difficult to design an effective anti-crime strategy and build an efficient Economics Minister Andrei Shapovalyants, 46, crime-busting network. was once an official of the Soviet GOSPLAN. Later, he served as Deputy Russian Economics and Defense Minister Igor Sergeyev, 61, ex-com- Finance Minister, First Deputy Economics Minis- mander of Russia’s Strategic Rocket Forces, also ter, and Acting Economics Minister. He has not has retained his ministerial portfolio. He is a been among the front-line reformers and has not professional military man who has proven his played an independent political role. loyalty to President Boris Yeltsin and, later, to Primakov. He is the first Russian Defense Minister Primakov’s “Power” Ministers to launch serious military reform, which is encountering strong resistance from generals and The national security-related ministries of senior officers. He is reported to have serious foreign affairs, defense, and interior—headed by health problems and may resign in the near term. the “power” ministers—report directly to the President. Neither Chernomyrdin nor Kiriyenko Other Ministers exerted sufficient influence over them. Under Primakov, however, this situation appears to be The ministers who head agencies in charge of changing. With Yeltsin ailing and politically weak- separate Russian economic branches and sectors ened, Primakov will assume control of these fall into two categories. The first group—Boris ministries in the short run. As a former foreign Pastukhov, Ramazan Abdulatipov, and Vladimir minister, he probably will retain control over for- Yegorov—includes ministers with broad experi-

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ence in the Communist nomenklatura. The second graduated from the Sverdlovsk Law School nine group—Mikhail Kirpichnikov, Georgy Gabunia, years ago and has completed his law degree. Sergei Generalov, Sergei Frank, Nikolai Krasheninnikov faces two difficult problems: Axyonenko, and Pavel Krasheninnikov—repre- integrating the penitentiary system he inherited sents a younger generation of professionals with from the Interior Ministry in accordance with the no prior political record. Council of Europe’s human rights stipulations, and arresting the growth of extremist organizations, Commonwealth of Independent States Affairs especially the rapidly growing neo-Nazi network. Minister Boris Pastukhov, 65 and a Primakov protégé, headed the Soviet Young Communist Primakov’s Executive Staff League from 1977 to 1982. Before joining the Russian Foreign Ministry as Primakov’s deputy, he Primakov personally selects his key staff to reg- served as Soviet Ambassador to Denmark and ulate the document flow and exercise control over Afghanistan. executive decisions. For many years, regardless of the position he held, he has trusted two men: Vice Nationality Policy Minister Ramazan Abdulati- Admiral Yuri Zubakov and Robert Markaryan. pov, 52, headed the Ethnic Relations Division of the U.S.S.R. Communist Party Central Committee Chief of Cabinet Staff Yuri Zubakov, 53, is a from 1988 to 1990. He later was elected to the former KGB counterintelligence officer. In the late U.S.S.R. Supreme Soviet and was made Speaker of 1980s, he worked in the CPSU Central Commit- its House of Nationalities. tee’s Administrative Bodies Department, which supervised the Soviet secret services. He used to be Culture Minister Vladimir Yegorov, 50, another in charge of Primakov’s personnel policies, both in former high-ranking Young Communist League the Soviet intelligence division and in the Foreign member and CPSU apparatchik, is in charge of Ministry. As chief of Cabinet staff, Zubakov is ideology. responsible for stopping government information Science and Technology Minister Mikhail leaks to the media. Kirpichnikov, 53, is a biologist and member of the Chief of the Prime Minister’s Personal Secretariat Russian Academy of Sciences. Robert Markaryan, 49, has been Primakov’s private assistant for two decades, ever since Primakov Foreign Trade Minister Georgy Gabunia, 46, is held high-ranking positions in the academic com- an international economics professional and has munity. Markaryan served in the Russian foreign spent his entire career in the Foreign Trade Minis- intelligence service (SVR) and the Foreign Ministry try. He will be the chief World Trade Organization in the same capacity. (WTO) negotiator for Russia. Fuel and Energy Minister Sergei Generalov, 35, WHAT THESE SELECTIONS MEAN FOR came to the government from the corporate busi- RUSSIA AND THE U.S. ness community. From 1994 to 1998, he served as vice president of a large oil and gas company and The Primakov government appears to be left- deputy chairman of the Bank Menatep. leaning and backward-looking. Most of its members are guided by their experiences during Transportation Minister Sergei Frank, 38, is a Mikhail Gorbachev’s ineffectual “reforms” of the sea transport engineer. His education is in foreign late 1980s and early 1990s, which were based on trade and law. an obscure philosophy of “socialist choice” and Railroad Minister Nikolai Axyonenko, 49, has not designed to develop a true free-market spent his entire career in the railroad system. economy. In the early 1990s, these so-called reforms caused an economic collapse in the Soviet Justice Minister Pavel Krasheninnikov, 34, is the Union. If Primakov and his advisers keep all their Primakov government’s youngest member. He pledges, Russia will be doomed to years of

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runaway inflation, social tension, and a degene particularly Americans, for the current crisis— rating industrial sector. painting the United States as the enemy once again and further handicapping already tense U.S.– Primakov’s government is more likely to Russian relations. strengthen its involvement in the economy and restrict economic freedom than to open markets CONCLUSION and make them more competitive. Government intervention will only lead to greater protection- The government of newly selected Prime Minis- ism, higher tax rates, spiraling inflation, tougher ter Evgeny Primakov brings together people who barriers on capital flows and foreign investment, represent very different political orientations, rigid restrictions on banking activities, stiff wage ideologies, backgrounds, and goals. Its controver- and price controls, poor protection of property sial composition could render it ineffective, as its rights, excessive regulation, and a skyrocketing members seem to be irresolute or even contradic- black market coupled with shortages of consumer tory. Primakov’s choices and actions may indicate goods. his desire not to alienate powerful political and Primakov’s policies also could seriously affect economic forces, such as international financial the national interests of the United States. A institutions, people and groups suffering from the departure from free-market reforms would further effects of the crisis, and the still-powerful oli- aggravate the social and economic situation within garchs. the Russian Federation. An outburst of popular Washington should make it clear that the discontent could give rise to internal violence, and United States will continue to help Russia through separatist tendencies could increase, hastening its current difficulties only if Prime Minister Russia’s dissolution into a cluster of isolated and Primakov’s government clearly and unequivocally poorly governed regions. Such disorder jeopar- demonstrates a commitment to free-market and dizes the centralized command and control of democratic reforms. The United States also should nuclear weapons, making them easy prey for insist that Primakov’s government concentrate on unpredictable local leaders, criminals, or terrorist fighting crime and corruption, continue on the groups. The proliferation of weapons of mass path of legal and court reform, respect the prop- destruction could expand even more rapidly than erty and rights of American investors, and institute feared. Such threats severely jeopardize U.S. tougher measures to ensure nuclear safety and the national security. non-proliferation of weapons of mass destruction. Even if the situation in Russia does not deterio- Without such assurances, U.S. relations with rate dramatically, the United States could well face Primakov and Russia inevitably will be fragile. other challenges. To divert popular attention from current hardships, for example, Primakov’s —Evgueni Volk, Ph.D., is Coordinator of The government could try to blame the West, and Heritage Foundation’s Moscow Office.

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