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It’s Not the Place That Makes the Person
// Mikhail Fradkov: A Career Profile
In his announcement of Mikhail Kasyanov’s dismissal, Vladimir Putin compared the future prime minister to a vice-president. Kommersant reporters Nikolai Vardul, Ilya Bulavinov, Konstantin Smirnov, Dmitry Butrin, and Gennady Sysoev analyze Mikhail Fradkov’s service record from the standpoint of this supposed position.
Professional Credentials
Mikhail Efimovich Fradkov was born on September 1, 1950, in the village of Kurumoch, Krasnoyarsky District, Kuibyshev Region. He graduated with honors from the Moscow Machine-Tool Institute in 1972 with a degree in mechanical engineering. Starting in 1973, he worked in the economic counsellor’s office at the USSR’s embassy in India; and then in 1975, began working in the All-Union Association Tyazhpromexport of the USSR State Committee for Foreign Economic Relations (GKES). In 1984, he was appointed deputy head of GKES’s main supply department. In 1988, he was appointed deputy, and then first deputy head of the main department for coordination and regulation of foreign economic operations of the USSR Ministry of Foreign Economic Relations. In 1991, he became senior advisor at Russia’s permanent mission to the UN and other international organizations in Geneva and Russia’s representative at GATT (now the WTO). In October 1993, he became first deputy minister of foreign economic relations of the RF responsible for coordinating the foreign economic relations of Russian regions.
Foreign Trader
Mikhail Fradkov was appointed deputy minister of foreign economic relations in December 1992. The minister at the time was Petr Aven, who was succeeded in 1993 by Sergei Glazev and then Oleg Davydov. In October 1993, Fradkov was promoted to first deputy minister.
He was kept busy. By January 1, 1995, the Ministry of Foreign Economic Relations (MVES) had held tenders for the export of strategic goods, including oil, petroleum products, and nonferrous metals, as well as tenders for imported goods supplied by India and Turkey against payment of debts to the former USSR. The ministry was also responsible for “oil-for-sugar” barter operations between Russia and Cuba.
Some concerned exporters occasionally overstepped the boundary of the law when lobbying for their interests at the ministry. At any rate, a number of criminal cases involving former MVES officials, e.g., Deputy Minister Andrei Dogaev, were launched in the mid-1990s.
There was also a scandal that touched Mikhail Fradkov personally. He had received a large loan to build a dacha from MVES’s extra-budgetary fund, but the president’s control department considered this fund to be illegal. However, Fradkov returned the loan and no case was initiated against him.
He became minister in March 1997, but oil prices let him down. They fell significantly at the beginning of the year, and as a result, exports decreased by $1.8 billion (from $89.2 billion in 1996 to $87.4 billion), the first decrease in the post-Soviet period. Fradkov seemed destined for dismissal. On February 26, 1998, Boris Yeltsin made his first appearance at an extended government session in the White House and right then and there threatened to fire three ministers. Everyone expected that Mikhail Fradkov would be one of them. He kept his job then, but not for long; he lasted only until March 23, when Sergei Kirienko replaced Viktor Chernomyrdin as prime minister. Fradkov returned in May 1999, to what was now the Ministry of Trade instead of MVES. This did not save the ministry: it was abolished exactly one year later.
Soviet Manager
Mikhail Fradkov has a highly unusual reputation in Russian business circles: nearly all business people who have met with him acknowledge that the candidate for prime minister is a bureaucrat who really understands what business is all about and how it is done. Significantly, Mr. Fradkov is someone who understands the circumstances behind the appearance of big capital not only in the “privatization period” from 1992 to 1997, but also in the period from 1988 to 1992, the time of late Soviet “foreign economic trade” and the formation of the first connections between what was still a Soviet bureaucracy, criminal organizations, and the first entrepreneurs. These connections still have a role in present-day business, but unlike later ones, they are never flaunted. Former MVES and Federal Tax Police Service (FSNP) officials describe Mr. Fradkov as a “superficially open person”: everyone who has associated with him talks about his civility and friendliness, but there are hardly any details about him as a person.
Mikhail Fradkov has never been overly popular among businessmen at any time in his career. In fact, during his time as head of the FSNP (2001–2003), he made a fair number of enemies. “When he was appointed head of the FSNP we thought they’d installed a sensible civilian. But he immediately announced that offenders would not get any soft treatment of the “pay and be let off” type. Offenders had to be jailed. So we weren’t sure who was best, some good old-fashioned general or this sort of bureaucrat,” says a member of the government’s “St. Petersburg team”. However, it is believed that the “mask shows” (so called because of the masks the tax police wore during raids) the FSNP organized during Fradkov’s tenure as head of the tax police were not on his personal initiative. It was the minister’s style to arrange quiet, discreet inspections of a specific organization under cover of noisy and senseless “large-scale operations.” The TV series “Maroseika, 12” about the tax police reminded the country of police minister Fradkov. The series was interesting because the FSNP never spent a single kopeck on the production: agencies under its jurisdiction allegedly volunteered to pay for the shooting.
However, the business world really has no personal complaints against Mikhail Fradkov. One businessman closely connected with the FSB characterizes Mr. Fradkov as “a figure who was always handed his boss’s problems to solve. He is a scrupulously orderly, pedantic, cautious, and diligent executive who is completely under control in all cases.” Very little is known about his likes and dislikes in relation to big business, except for YUKOS. It is rumored that the ex-FSNP chief was always at odds with the company’s management, along with Alfa Group and Petr Aven (president of Alfa Bank) personally, whom he pestered continually from the time he started working at MVES. Few remember his tenure as head of Ingosstrakh in 1998–1999 either; Fradkov allegedly owed this appointment to Evgeny Primakov, and his main occupation in this position was not so much business as unsuccessful schemes to set up a state export-import agency around Ingosstrakh.
Weak Force
Mikhail Fradkov can technically be considered a member of the “forces”. As a colonel of the reserves, Fradkov worked as first deputy secretary of the Security Council in 2000–2001; and from 2001 to 2003 he headed the Federal Tax Police Service. However, the new prime minister never proved his worth as an enforcer.
Mikhail Fradkov was appointed to the Security Council, which in the early days of Vladimir Putin’s presidency was considered a training ground for the young president’s staff, solely because he had to be appointed to something after the Ministry of Trade was abolished. The Security Council administration had always been a warehouse for high-ranking sacked bureaucrats. Interestingly enough, the Security Council administration, which Sergei Ivanov headed at the time, was not expecting the new deputy secretary at all and was not prepared for his arrival. When he appointed the ex-minister first deputy secretary of the Security Council, President Putin also increased the administration’s staff, but only by one person. Thus, when Fradkov arrived at his new job, there was no salary even for his secretary. Nor was there any department for him to head, since all Security Council departments were already divided up among other deputy secretaries.
During the eight months he spent at the Security Council, Mikhail Fradkov was always on the sidelines of the main events. In 2000 and early 2001, most of the administration’s energies went into working out a military organizational concept that Sergei Ivanov later had to try and put into practice as Defense Minister. Fradkov did not take an active part in this work for objective reasons: he knew nothing about army issues and there was no point in his getting involved in them.
On March 28, 2001, Mikhail Fradkov became head of the FSNP, not the least important part of the Russian “force” structures (i.e., the army, FSB, police, etc.). The FSNP was set up in March 1992 as the Main Tax Investigation Department of the State Revenue Service and reorganized into an independent tax police department in August 1993. Lieutenant-General Sergei Almazov of what was then the Ministry of Security was appointed department head. In December 1995, he succeeded in raising his department’s status to the level of tax police force. As a rule, it was staffed by former KGB and Main Intelligence Directorate (GRU) members. It was no accident that this physical security force was considered the best of the similar force structures. In any case, its regularly staged mask shows made a stunning impression on taxpayers under investigation. The same cannot be said of the results of the tax police’s investigative actions, since only a handful of criminal cases ever made it to court.
In March 1999, Interior Ministry (MVD) lieutenant-general Vyacheslav Soltaganov replaced Sergei Almazov and began ousting former Chekists (KGB members) and intelligence officers from the tax police and replacing them with police officers. However, he did not succeed in making investigations of tax crimes more effective. In an interview with Kommersant (see the issue of November 11, 2000), Vladimir Makarov, a colleague of General Soltaganov and a former deputy head of the already-reorganized Main Directorate for Combating Economic Crime (GUBEP), cited figures proving the overwhelming superiority of police forces over the tax police in fighting economic crime (including tax crimes). GUBEP uncovered more than 88% of these offences in 2000, whereas the FSNP uncovered only 6.9% [the FSB and State Customs Committee (GTK) accounted for the rest].
Mikhail Fradkov was transferred to the FSNP from the Security Council primarily to increase the service’s effectiveness, and admittedly he tried to do this. He virtually declared war on the other enforcers and took some of their powers away from them. Before his arrival, the FSNP had been prosecuting cases under Article 27 of the Criminal Code, but starting in summer 2002, this was changed to Article 53, right down to unlawful carrying of a weapon.
Then he began to tread on taxpayers’ rights. Just before the FSNP was disbanded in March 2003, his subordinates hit upon the idea of using lie detectors, but that was no help. Although the FSNP “uncovered” 24 000 tax crimes in 2002, the agency managed to convict only 40 people. The result was predictable: the Interior Ministry absorbed the FSNP, and Mikhail Fradkov was dispatched as Russia’s ambassador to the EU.
Noncareer Diplomat
Mikhail Fradkov became Russia’s ambassador to the European Union with the rank of minister in March 2003. We note that he had already been assigned to this position in early 1997 when he was deputy minister of foreign economic relations, but that ended when he became minister. It was assumed he would know how to defend Russia’s interests during the impending expansion of the EU. Here are some of Mr. Fradkov’s reports to Vladimir Putin: during a working meeting in August 2003, he reported that preparations were underway for a meeting of the ministers of transport of Russia and the EU, as well as the ministers of agriculture; he also informed the president that he was preparing a concept of a common economic space and was preparing a corresponding report for the upcoming Russia–EU summit in Rome in November. The ambassador also noted that preparations for the energy summit and negotiations on Russia’s accession to the WTO were complete.
What were the results? Relations between Russia and the EU became noticeably worse under Mr. Fradkov. EU members were annoyed above all by Moscow’s unwillingness to automatically extend the Partnership and Cooperation Agreement (PCA) with the EU, in effect since 1997, to the ten countries that would be joining the EU on May 1, 2004. The EU has also been trying for a long time to get Moscow to ratify the Kyoto Agreement and liberalize the gas sector (threatening to block Russia’s accession to the WTO otherwise). It regularly demands that Russia ensure freedom of the media and observe human rights in Chechnya. Recently, EU officials have repeatedly expressed their concerns regarding the “YUKOS affair” as well.
Russia has responded with its own list of complaints against the EU. It is demanding that Brussels compensate Russia for losses from expansion of the EU, support its accession to the WTO, guarantee free transit for Russians through Lithuania to Kaliningrad, recognize the official status of the Russian language in Latvia and Estonia, and finally, move towards abolishing the visa regime between Russia and the EU. The president personally intervened in the issue of obstacles the EU has put in Russia’s way to WTO accession: “We will not allow them to twist Russia’s arm.”
The mutual squabbling between Moscow and Brussels led the heads of the EU’s interior ministries to deliver an ultimatum to Russia on February 23, 2004, the day before Mikhail Kasyanov was fired. They demanded that Moscow extend the PCA with the EU to the ten incoming member countries without further delay, threatening Russia with economic sanctions if it did not.
Political Lightweight
“I have already said that I support an overall policy of strengthening the role of parties in public life. With consideration of the results of the upcoming State Duma elections, I believe it is possible to form a professional, effective government supported by a parliamentary majority,” Vladimir Putin declared last May in his annual address to the Federal Assembly. Immediately after Mikhail Kasyanov’s dismissal, the president spoke of the need to consider the opinion of the parliamentary majority.
However, Mikhail Fradkov has never had any relation to the parties now represented in the Duma, including United Russia (Edinaya Rossiya), which won the elections and controls the constitutional majority in the house. Moreover, until yesterday, few of the party leaders who went to “advise” the president on the candidacy of the new prime minister last week even knew the surname of the person who would now be relying on them. Thus, in reality, the role of the party of power in choosing the prime minister amounted to the secretary of United Russia’s general council, Valery Bogomolov, making a trip to Brussels, where he could have easily sounded out Russia’s representative at the EU on the subject of a possible appointment in early February.
All formalities will be observed, of course, and one of United Russia’s representatives in the Duma will soon receive an appointment to the government. However, this can hardly be considered “strengthening of the role of parties in public life.” On the contrary, the appointment as prime minister of a bureaucrat little known even to parliamentary majority leaders is evidence of a drastic weakening of the role of parties. Whereas previously the Kremlin needed to win the support of at least some Duma blocs by some means or other in order to confirm a prime minister, now the Kremlin need only summon the leaders of the party of power.
As for Mikhail Fradkov himself, his less-than-brilliant career will not be detrimental to him in the present political situation. After all, an undistinguished service record did no harm at all to the last prime minister appointed by Boris Yeltsin.
All the Article in Russian as of Mar. 02, 2004
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Photo: Dmitry Dukhanin
