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Big business in Russia snuggles up to politics

In America the relationship between big business and politics may be cozy; in Russia it is fast becoming intimate.

The nation's largest businesses -- from oil giants to banks to manufacturers -- have not only poured money into the parliamentary elections to be held on Sunday, but have also filled party tickets with dozens of their executives.

Yukos Oil, whose former chairman, Mikhail Khodorkovsky, is in prison on charges widely viewed as politically motivated, has executives running as candidates not only for the liberal Yabloko party, but also for the communists and for United Russia, the party loyal to President Vladimir Putin.

The prosecutorial assault on Khodorkovsky -- one of a cadre of wealthy businessmen know derisively as oligarchs -- has been seen as a broader assault on big business in Russia. But in fact big business has become more closely intertwined with politics than ever.

While the popularity of Putin and United Russia appear to have been strengthened by the investigation of Khodorkovsky, the party has its own candidates from prominent companies controlled by other oligarchs as well.

Two oil companies, TNK and Lukoil, have executives running on the party's ticket, as do Russian Aluminum and the steel giant Severstal. An analysis of United Russia's federal and regional party lists by The Moscow Times showed that more than a quarter of United Russia's parliamentary candidates represented big businesses.

Perhaps to hedge its bet, TNK also has a spot on the communist ticket, while Russian Aluminum's deputy general director is running as a candidate of the Liberal Democratic Party, led by the strident nationalist Vladimir Zhirinovsky.

Twelve years after the collapse of the Soviet one-party state, big business has now become by far the most influential force in Russia's elections, providing money and candidates but also profoundly altering party platforms and, in some cases, turning upside down traditional ideologies.

The election on Sunday -- in which 23 parties are vying for all 450 seats of the lower house of parliament -- represents a critical turn for Russia and for Putin, who is universally expected to win a second term in the presidential election next March.

Although not officially a member of any party, Putin has thrown his power and popularity behind United Russia, mostly recently in remarks broadcast on Friday, saying that a centrist majority led by the party was essential to the economic and bureaucratic reforms he vowed to pursue in a second term.

Regardless of which party wins the most seats, the nation's largest companies appear certain to be well represented in the new parliament, wielding enough influence to propose or block legislation affecting corporate interests, from taxes to regulation of natural resources.

Dmitri Orlov, deputy director of the Center for Political Technologies in Moscow, predicted that executives would win more than 20 percent of parliament's 450 seats. Another 40 percent could end up in the hands of what he called "hidden lobbyists," candidates supported by businesses to protect the interests of specific industries.

"It is not a new phenomenon," Orlov said of the role of big business in Russia's politics. "It was known in 1995 and 1999, but it has only achieved such a scale in this election."

Khodorkovsky's efforts to influence parliament, particularly in blocking a new law on oil production earlier this year, are widely viewed as a catalyst for the sweeping investigation of alleged tax evasion and fraud that has put him in a Moscow prison.

Khodorkovsky also openly contributed money to two liberal parties, Yabloko and the Union of Right Forces, to try to create a solid bloc of legislators opposed to Putin.

Grigory Yavlinsky, the leader of Yabloko, acknowledged in a recent television interview that the party had included three Yukos executives on its federal list of candidates as a condition of Khodorkovsky's contributions.

Khodorkovsky's many critics have accused him of trying to buy a controlling majority.

The extent of executives' participation in the election is a result of a new law requiring candidates to declare their incomes and employers. If elected, executives are required to resign from their companies, but they can keep their shares and other holdings, and analysts say that many severe their ties to business only nominally.

The Communist Party has found itself on the defensive because of its embrace of business. State-controlled television has featured critical stories of the executives on its ticket.

One of them is Aleksei Kondaurov, who occupies the 13th spot on the Communist Party's federal list. Since half of the parliament's seats are proportioned based on parties' total votes, with the other half chosen by districts, Kondaurov is virtually assured election. He is also an executive of Yukos-Moscow, the oil company's main subsidiary.

It is one measure of the ideological upheaval in Russian politics that he argues that the Communist Party is now the party of business.

"Today's Communist Party does not reject private property," he said. "It does not reject the mechanisms for market development. The Communist Party is for the strengthening of democratic institutions and the development of civil society."

Kondaurov's candidacy and that of other executives have exposed deep divisions within a party still struggling to formulate a post-Soviet message.

Leonid Mayevsky, a communist deputy in the current Parliament, publicly criticized the party at a news conference earlier this month, saying that 28 percent of its candidates were millionaires.

"Is this the party of the people or of the millionaires?" he asked.

He was promptly expelled from the party.
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