This man is now the people`s billionaire
ByLine: ANNE APPLEBAUM
He isn't your typical political prisoner: Mikhail Khodorkovsky, who goes on trial next week with his business
partner, Platon Lebedev, is by some accounts worth $8 billion. He hasn't been charged with political crimes either,
but rather with fraud and tax evasion: recently, the Russian authorities claimed that he owes $700 million in back
taxes. Yet despite charges that sound more as if they belong in a Martha Stewart case or an Enron trial, despite a
defendant who is, to put it mildly, far better heeled than the average dissident, Russian human rights groups are
calling this the first "show trial" of the Putin era. Why?
The explanation lies in the peculiar character of Khodorkovksy, as well as in the strange nature of the regime that
is now about to try him. He did, it is true, make his money through questionable means, just like everybody else who got
rich in Russia in the 1990s. Originally the leader of the Komsomol, the Communist youth movement, he parlayed his
connections first into a computer import business, then into the purchase of Yukos, a state-owned oil company. And
"connections" is the key word: somehow, Khodorkovsky's company managed to pay only $300 million for a
business that is now thought to be worth more than $17 billion. The $8 billion is his personal stake.
In his early days as Yukos chief executive, Khodorkovsky spent his time suing journalists, denying accusations of
financial skulduggery and even murder. Slowly, though, he changed his tactics. About two years ago, I got a telephone
call from the office of Prince Michael of Kent asking if I wanted to join a party of journalists (I didn't) on an
all-expenses-paid trip around Russia. All travel, by corporate jet, from St Petersburg to Siberia was to be paid for by
an unnamed tycoon who turned out to be Khodorkovsky.
Good businessman that he is, Khodorkovsky soon found smarter ways to spend his money. Rather than waste time with
freeloading journalists, he decided to change the company's reputation by changing the company. He brought Western
standards of corporate governance and financial transparency to Yukos. He also began funding schools, hospitals and
libraries in the decrepit northern cities where Yukos does its drilling. Above all, though, he started the Open Russia
Foundation, whose board members included Henry Kissinger and Lord (Jacob) Rothschild, and whose launch took place at the
American Library of Congress. But the Open Russia Foundation was not just well-connected: it also funded genuinely good
causes in Russia, including human rights groups, as well as schools, institutes and other organisations dedicated to the
promotion of democracy and Western values.
Whether or not he did so in the beginning, it seems that Khodorkovsky did actually start to believe in the causes his
foundation was promoting. He began to chafe at the unwritten rules that require Russian tycoons to pay up when the
government demands it, to remain silent when required, and to avoid acquiring any political power whatsoever. According
to some, he crossed the line when he started talking of major deals with an American oil company. According to others,
his direct dealings with the Chinese government did the trick. Still others suspect that his funding of opposition
political parties upset the Kremlin. Whatever the specific cause, the authorities finally decided he had got too big for
his fur-lined boots, and threw him in prison.
It is probably true that Khodorkovsky broke tax laws, and probably plenty of other laws - Yukos once had a distinctly
dirty, even murderous reputation - but if the Kremlin were arresting businessmen for corruption and tax evasion, there
would be plenty of candidates. The only reason to single out Khodorkovsky was to set an example for others who might
also have thought of defying the Kremlin.
Perhaps if Khodorkovsky's arrest had taken place in a vacuum, it wouldn't have caused much distress. But in
the four years that Vladimir Putin has been president of Russia, he has also dramatically weakened the country's
independent media, destroyed opposition parties, and made the secret police a force in public life again. During his
"state of the nation" speech last month, Putin even hinted at a new target: the "nongovernmental
organisations" - human rights groups, charities and unions - that constitute the last remnants of the civil society
that developed in Russia in the 1990s. Some thought he was referring directly to the organisations that have been
supported by Khodorkovsky's Open Russian Foundation.
For all of those reasons, the remnants of Russia's fragmented human rights movements have rallied to
Khodorkovsky's defence, even though the cause of a multi-billionaire will hardly be a popular one in Russia. Last
week, I asked Arseny Roginsky, a historian and human rights activist, how far he thought the re-Sovietisation of Russia
could go. "Far," he replied, and then: "Much farther." The distress he and others will feel watching
Khodorkovsky's trial is not so much sorrow for the fate of a single billionaire, but fear that it might be the
first of many.
Anne Applebaum is on the editorial board of The Washington Post
|
RUSSIA IN FACTS
