Washington Post - 10.23.2003

The Washington Post

Lonely at the Top for Russia's Billionaires

Already Unpopular Among the Public, 'Oligarchs' Become Election-Year Targets

By Susan B. Glasser, Washington Post Foreign Service

MOSCOW -- In this Russian election year, there's no more inviting target.

Disdained as "oligarchs" by politicians across the political spectrum, Russia's small class of big-business billionaires contains the most reliably unpopular figures in public life. More than 70 percent of people polled say they dislike them, and nearly 60 percent say they are not good for Russia.

Since the summer, Russian law-enforcement agencies have targeted the biggest private business of all, oil giant Yukos. A series of investigations have landed one billionaire in jail, led to charges last week against a second and raised speculation that Yukos chairman Mikhail Khodorkovsky, Russia's richest man, could be next.

While Western governments and stock market analysts fret that the attack on Yukos could harm Russia's economy, the election-year investigations have been sending a different message to voters. For them, according to opinion polls and political analysts, oligarch-bashing is simply good politics.

"Oligarchs are positioned to be very unpopular, like figures from hell, and this idea is becoming more and more popular among the electorate," said Alexei Kandaurov, a top Yukos official running for parliament on the Communist ticket. "Unfortunately, people bite on this like fish."

"They are pitting 'simple people' against businessmen, and it works," said Boris Nadezhdin, a leader of the reformist Union of Right Forces party, which is financially backed by Khodorkovsky and other business leaders. "There are 17 billionaires in Russia and 40 million people who live below the poverty level."

In the 1990s, President Boris Yeltsin routinely raised the specter of the Communists' returning to power when he was foundering politically. Today Communists still garner around one-quarter of the national vote in surveys, but analysts generally don't view them as having a chance to win a majority in the Dec. 7 parliamentary balloting or to unseat President Vladimir Putin in a presidential election March 14. 

The Kremlin "had to find a new threat to mobilize the masses to vote for Putin and his party in the Duma, and they found one in the oligarchs," said Igor Yurgens, executive director of the business lobbying group known as the Russian Union of Industrialists and Entrepreneurs.

Yurgens said his group was warned by political consultants early this year that "we have no other way but to put you on the shooting range because you are the oligarchs and it's the election period."

Last week, the businessmen decided to fight back with a campaign of their own, which will fund major new public health and education projects. The idea, Yurgens said, is to show that big business philanthropy can do what the Russian government has failed to do. "We call it the 'failure of the state' project," he said, adding that it is meant to combat the election-year portrayal of Russian big businessmen as practicing "pure gangster enrichment." Yukos, too, has attempted to soften the attack on it, running billboards and ads across the country with the slogan, "We're Together."

Its chief, Khodorkovsky, does not deny that he and his fellow billionaires are wildly unpopular. He recently told an audience in Washington that there was no way he could consider a political career because of how much Russians dislike the "oligarchy."

The only dispute is just how much they are disliked, and whether that unpopularity can be translated into concrete advantage for the Russian political parties engaging in oligarch-bashing (which is basically all of them).

The Communists, who traditionally have attacked big business the hardest, now worry publicly that the Kremlin may have stolen their thunder. "Attacking the oligarchs is popular now as an election theme because it's been blessed by the highest power, the president," said Viktor Peshkov, a party leader. "It's become a leitmotif of our political life -- but we Communists are even losing in the competition to make sharp comments on this subject."

Kremlin pollster Alexander Oslon of the Public Opinion Foundation agreed that Putin is the main beneficiary. Voters, he said, support "any actions of the government directed toward bringing things in order, no matter whether it's a struggle against oligarchs or against the so-called werewolves in epaulettes," corrupt officials inside the police.

But, he cautioned that the Russian electorate is focusing on more practical matters. While Russian elites fear that the Yukos case will trigger a broad reevaluation of the 1990s privatization deals that made the oligarchs' fortunes, Oslon said that ordinary voters would be worried only if the government looked again at the privatization by which large numbers of Russians obtained apartments from the government.

As for the level of unpopularity, it depends mostly on how the question is phrased. In polls seeking opinions about "oligarchs," more than 70 percent surveyed say they dislike them. The Public Opinion Foundation found in July that 59 percent believed that "oligarchs do more harm than good to Russia." In a survey by ROMIR Monitoring this summer, just 3 percent said they like the oligarchs.

Feelings are more neutral when the word "oligarch" isn't used. Asked about the "richest Russian businessmen" in a poll by the All-Russia Center for the Study of Public Opinion, for example, 37 percent of people surveyed said they had no particular strong feeling (though 30 percent expressed "hate"). Forty-nine percent said that revisiting the results of privatization would be harmful to Russia, the Public Opinion Foundation survey found. 

Some analysts are skeptical that oligarch-bashing will ultimately amount to much in the campaign. For one thing, all of the parties -- including the Communists and other leftists -- are including wealthy businessmen among their candidates, suggesting that the elections won't turn into a referendum on which party is most oligarch-free. 

When Putin came to power in 2000, political expert Andrei Ryabov of the Carnegie Moscow Center said, he gained politically by waging a campaign against two media tycoons, Vladimir Gusinsky and Boris Berezovsky. They were eventually forced to give up their Russian holdings and went into self-imposed exile.

"The Yukos situation is not so clear," Ryabov said. "At first, it was perceived as fighting for social justice by taking on the oligarchs. But now people begin to perceive the conflict as a fight between two groups for power." 

What does seem clear is that the campaigning leading up to the parliamentary contests will take place at the same time as further developments emerge in the Yukos investigation. 

The lead prosecutor in the case, Vladimir Kolesnikov, said Tuesday that he planned to seek criminal charges against senior Yukos managers, including possibly Khodorkovsky. "There's no need for cheating and stealing," Kolesnikov said. "You have to answer for that."