First Deputy Prima Minister Yury Maslyukov is about to
be thrown out of the Cabinet. He’s staked his career on
getting a loan for Russia from the IMF, and it’s clear
that he won’t be able to get it. As the default time bomb
ticked down last week, Maslyukov was sent to Indonesia.
The reason is clear. He has a better chance of securing
a multi-billion dollar loan from financially struggling
Indonesia than from the IMF.
The desperation of the government for the IMF loan has
been shown be its incessant predictions of a forthcoming
agreement, and be hasty changes in Russian negotiators.
Last weekend former Prime Minister Viktor Chernomyrdin
– the second worst possible loan negotiator – returned
from talks with the IMF in Washington and said the Cabinet
needed greater economic expertise. In other words, Maslyukov
will be pitched and a Western-oriented “liberal economist”
will have to be installed in hos place, if only for show.
Don’t think for a second that this means that former
Deputy Prime Minister Anatoly Chubais or former prime
ministers Yegor Gaidar or Serghei Kiriyenko will re-enter
the Cabinet. They have even less credibility now in the
West than they do in Russia. There are a few other old
warhorses that don’t quite fit the bill: former Cabinet
ministers Yevgeny Yasin, Alexander Livshits, and Alexander
Shokin. Former Finance Minister Boris Fyodorov would probably
satisfy the IMF, but it is unacceptable to the government.
Moscow Mayor Yury Luzhkov was very direct in naming the
leader of the Yabloko party, Grigory Yavlinsky, as the
leading contender for the job. Yavlinsky’s appointment
is by no means a done deal. He may even have already turned
down the appointment because he is unsure whether he’ll
have enough power to effectively govern the country. He
would reject the first deputy prime minister’s chair if
he’s appointed just as a showpiece to satisfy the IMF.
Nevertheless, faced with the alternative of a complete
default, Prime Minister Yevgeny Primakov and President
Boris Yeltsin will probably promise Yavlinsky just enough
power to get him to accept the position.
Yavlinsky’s power will not br based solely on the promises
of Primakov and Yeltsin. Yabloko has the support of between
10 percent and 15 percent of the Russian population, with
few people intensely disliking its positions. Yabloko’s
support will greatly increase once the party attains a
position of power. Luzhkov, Yavlinsky’s apparent ally,
has the support of an additional 10 percent to 15 percent.
Between them, they could control the only active political
factions other than the Communist party and the supportes
of the do-nothing Primakov.
Yavlinsky would be a wonderful choice to run the economy.
He’s a professional economist who designed the famous
– but never implemented – “500-day plan” for economic
reform under Soviet leader Mikhail Gorbaciov. Since that
time, he’s led Russia’s only truly democratic and reform-oriented
party. He’s turned down several chances to join the government
while other so-called democrats and reformers were using
their posts to plunder the Russian economy. Indeed, Yavlinsky
has made a point of exposing corruption in the government.
The only complaints about Yavlinsky have been that he’s
too idealistic and too reluctant to compromise to have
a positive effect on government. I consider these points,
however, to have been his greatest strengths. Compromise
with the pirates who’ve been running the Russian economy
would have been the kiss of political death, as Kiriyenko
founded out. Too idealistic to serve in the Russian government?
– that phrase would have covered anybody who had even
a single scruple – but all things must eventually change.
Yavlinsky represents everything that the current and
former does not: idealism, democracy, a sensible economic
policy, and the fight against corruption.
Several obstacles beyond the simple enormity of Russia’s
economic problems will face Yavlinsky if he attempts to
govern. The Communist party will likely stop just short
of armed insurrection to protest Maslyukov’s removal.
They will be able to block any legislation that Yavlinsky
submits to the State Duma. As a democrat, Yavlinsky’s
principles and political skills will be sorely tested
by his relations with the Duma. His political skills
are somewhat suspect since he’s never held a national
political office. Compromise will now be a requirement,
not a sign of weakness.
The upcoming Duma and presidential elections will greatly
complicate matters. Corruption allegations will be seen
by many as purely political maneuvers. Primakov and Luzhkov
may jockey for position as potential political allies,
or they may turn on Yavlinsky for political gain. Nevertheless,
of Yavlinsky survives his first three months in office,
he will almost surely emerge as the front-runner in the
Leader of Gazprom, oil firms, and bankrupt industrialists
and bankers will fiercely oppose Yavlinsky, because any
sensible programs on the economy will limit their abuse
But perhaps the most dangerous opposition will come from
Yeltsin. In the near term Yeltsin will likely support
personnel changes that will help Yavlinsky, in order to
balance opposing political forces. In the long term, however,
moves to balance power will result in halfway measures
on the economy. Halfway measures simply will not work
Yavlinsky will, I believe, be appointed to and accept
the position of first deputy prime minister in charge
of the economy. He’ll have a tough row to hoe. Designing
an economic policy will be the simplest task that he’ll
need to accomplish. If he manages to get the enthusiastic
support of the Russian people, he will successfully change
the face of Russian politics and economics. But, without
the people’s support to counter opposition from his political
enemies, complete economic and political failure are possible.