Russia: Another billionaire stands up to the Kremlin

MOSCOW, Russia — Surprising no one, last weekend Russian Prime Minister Vladimir Putin shunted aside incumbent President Dmitry Medvedev — apparently by longstanding pre-arrangement between the two men. The move all but assures that Putin will return to the Kremlin next March as the country's supreme leader.

In other words, over the past four years, Russia’s political system has apparently allowed a faux president, as Medvedev clearly was, to keep the top chair warm until the real leader, encumbered by term limits, chose to reclaim it.

Until recently, the mechanics of the system that orchestrates most political activity in Putin's Russia have been shrouded in mystery. But earlier this month Mikhail Prokhorov, Russia's third richest man, broke with the Kremlin-sponsored political party he had earlier been invited to lead, and bitterly blurted out a few truths that help to illuminate the landscape.

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Although Russia appears to have a full spectrum of political parties, regular elections and a functioning parliament, it's all an elaborate façade, according to Prokhorov. He told journalists it's actually the Kremlin that micromanages political parties, deciding who may lead them and which candidates they may include on their lists. The Kremlin, he said, also determines the amount of media coverage and campaign exposure they may enjoy.

He named the architect of that system as Vladislav Surkov, the Kremlin's deputy chief of staff, a figure who has been very close to Putin for many years.

Surkov is a "puppet master," who has "long misinformed the country's leadership about what is happening in the political system, suppressed the media and created discord," Prokhorov said.

"I will take it as my personal task to see that Surkov is sacked," he added.

Instead, it was Prokhorov who immediately started experiencing difficulties. Most members of Prokhorov's party, Pravoye Delo, rebelled against him on Surkov's orders, according to Prokhorov. They held a separate convention to throw him out. Within days Prokhorov was expelled from an important, senior-level Kremlin economic policy commission. And officials suddenly cancelled the long-planned construction of a road to one of Prokhorov's factories.

Prokhorov knew the system was rigged, "but thought he could be a real actor even in that limited arena," says Georgy Satarov, who was an adviser to former President Boris Yeltsin and now heads the independent InDem think tank in Moscow. "He didn't understand that in Russia all politics are now virtual; there is no such thing as independent activity."

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Surkov is a half-Russian, half-Chechen former oil executive. Fittingly, he briefly majored in theater direction at the Moscow Institute of Culture in the 1980s. He is widely seen as the Kremlin’s chief ideologist. He joined the presidential administration in 1999, and has been a fixture in Putin’s entourage ever since.

Far from being sacked in the wake of the Prokhorov affair, on Sept. 21 Putin officially decorated Surkov, awarding him the governmental order of Pyotr Stolypin, Grade II, “for fruitful state activities.”

Prokhorov, whose fortune is estimated by Forbes at $18 billion, is best known in the U.S. as the hands-on owner of the New Jersey Nets basketball team. For Russians, the towering tycoon (he's 6' 9") has long been in the headlines as the country's most eligible bachelor, an amateur athlete who posts high testosterone videos of his jet-ski stunts on YouTube, and an innovative entrepreneur who is developing an electric car to wean his countrymen from their addiction to internal combustion engines.

In June 2011 Prokhorov took over the moribund Pravoye Delo, or Right Cause, party. He pledged to invest up to $100 million of his own money to turn its fortunes around in time for the State Duma elections slated for December. If the party won more than the 7 percent of votes needed to gain entry to the Duma, Prokhorov said he would petition the president to appoint him prime minister. He even hinted at presidential ambitions.

It was widely assumed that Prokhorov must be acting with the Kremlin's permission and under the instructions of Surkov. The last Russian super-wealthy "oligarch" who got mixed up in opposition politics, oil magnate Mikhail Khodorkovsky, has been in prison since 2003.

"The main organizer of Russia's political system is, of course, Putin," says Andrei Kolesnikov, a columnist with the opposition weekly Novaya Gazeta. "But Surkov is the very talented technical manager who oversees its workings. All registered political parties are his clients. He manipulates and orchestrates them. When anyone departs from the script, he finds a way to remove them."

Experts say Surkov probably saw Prokhorov's party as a pretty flower to plant on the right-wing of Russia's political garden. The party would serve a useful purpose, safely drawing the votes of pro-business and liberal-minded people who were never likely to support the United Russia party, the Putin’s pro-Kremlin behemoth, which controls the Duma and most regional legislatures.

But Prokhorov spent his money on professionally-produced billboards and TV spots. He hired dozens of spin-doctors, assembled a crew of strong regional candidates, and began steering his party program toward the popular center-left positions that are the political turf of United Russia.

By Prokhorov's own account, he and Surkov quarreled violently over the inclusion of Yevgeny Roizman, a controversial anti-drug campaigner, in Pravoye Delo's leadership circle.

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It was then that Surkov decided to pull the plug on Prokhorov. Within a matter of days the tycoon lost his party, his political career and his blue ribbon access to Kremlin committees. If he isn't careful, experts say, he could lose his freedom too, and maybe even follow Khodorkovsky into a Siberian penal colony.

How was it possible for one of the world's richest men to be discarded and disgraced so swiftly and completely?

Experts say that people in the West are used to thinking of wealth as a source of political influence, a necessary ingredient of power. But in Russia things work in reverse. Since Putin came to power, rich people have been allowed to keep their property only if they remained on good terms with the Kremlin.

"It's true that in Russia the state is the initiator of a number of political parties and civic movements," says Alexei Pushkov, a popular TV personality and candidate for the ruling United Russia party in the upcoming Duma polls.

"But you have to understand that we came from Communism, where all that was non-existent. It has to come from the top. There's a lot of political engineering here, but it cannot be otherwise."

If Prokhorov wants to halt the death spiral and return to his formerly happy life as a Russian oligarch, there is only one obvious way to do that.

"Prohorov needs to sit down with Putin for a heart-to-heart chat," says columnist Kolesnikov. "He can explain that he's not a dissident, that he just wanted to work inside the system, modernize it a bit, and not to make a real challenge. Putin is an understanding man. If Prokhorov agrees to leave politics and stick to business in future, he'll probably be OK."