Russia’s Bureaucratic Corruption Has New Foe

MOSCOW —  Disgusted by the shameless greed of his aides, Czar Peter the Great ordered the immediate execution of any official caught stealing from the government even the cost of a piece of rope.

But the aide taking down the order paused. “Does Your Majesty wish to live alone in the empire without any subjects?” he asked.

Three centuries have passed, but no ruler has had any more luck than Peter in wiping out corruption in Russia’s vast administrative apparatus.

So expectations were low when retired Gen. Alexander I. Lebed was appointed Russian security chief by President Boris N. Yeltsin, despite Lebed’s promise of clean politics and “an absolutely new approach.”

Now, however, the onetime paratrooper has begun to confound his critics with a corruption-busting strategy so unorthodox that even the wiliest of courtiers have been caught napping. And some in Moscow’s corridors of power have begun to hope that Lebed’s surprise tactics, and his willingness to drag dark Kremlin secrets out into broad daylight, might eventually win the war against bureaucratic crime.

“The battle against corruption has been going on for the last 1,000 years,” Lebed boomed confidently after his appointment. “But our bureaucrats are hardened and not easy to fight. So long as they have a chance to steal something, they will steal it. So I guess we just need to change our tack.”

The pessimists said he was too provincial, too much of a military straight arrow and too politically inexperienced to beat the subtle Kremlin courtiers, who would be doing battle for their shady profits on their own turf.

Early on, he sensed the possibility of ambush inside the Kremlin. With sound military instinct, he decamped to more familiar terrain--by getting Yeltsin to give him an extra job as peacemaker in Chechnya, where Russian troops had been at war with the republic’s separatists for nearly two years.

Lebed used the peace deal he clinched with Chechen fighters recently to relentlessly expose corruption in the Russian power ministries. From safety outside the Kremlin walls, he has lobbed bombshell after media bombshell back at his Moscow targets.

He stormed back to Moscow from a first Chechen trip accusing the Moscow military top brass of pursuing a “criminal, commercial” war in the south, against Russia’s best interests, to line their own pockets.

Although he failed in his bid to have Interior Minister Anatoly S. Kulikov fired, Lebed managed to force the establishment out into the open to answer his challenges.

By separating the warring sides in Chechnya, he also cut off the flow of money from undercover arms sales to the rebels, just one of many abuses in the war, which Russian investigative journalist Alexander Minkin has described as “the root of corruption in Russia.”

“I have won this chess game. I won it even with the disadvantage of not starting first. And I [had the modesty to] make it look like a draw,” Lebed said triumphantly.

Now the corrupt and conservative aides who brought Yeltsin’s first administration into disrepute have been routed. The orthodoxies of Yeltsin’s first term in office--that might meant right and possession was nine-tenths of the law--are being questioned. Startled bureaucrats are quickly rethinking loyalties and looking for new protectors.

Although tension is visible between Lebed and other rivals for influence in the Kremlin--including Prime Minister Viktor S. Chernomyrdin and Yeltsin’s new chief of staff, Anatoly B. Chubais--the savvy mayor of Moscow, Yuri M. Luzhkov, has opted to back Lebed.

Lebed’s success has enchanted the liberal media, which were initially suspicious of the man who once enthused about former Chilean dictator Augusto Pinochet. Now, between lyrical praise for his strategy and crisp sound-bites, newspapers feature pictures of a Lebed smiling faintly and looking reflective, as smoke curls gently up from his cigarette holder, or playing chess with Chechen rebels.

The recent successes are a far cry from his awkward start in June--when he was still at the bottom of the political learning curve and his first move against Yeltsin aides earned him only suspicion.

The price Lebed had demanded for taking his job was the dismissal of the hawkish defense minister, Pavel S. Grachev, universally loathed not only because of Chechnya but also because of a widespread belief that he had abused his office. With Grachev, nicknamed “Pasha Mercedes,” went a handful of his allies.

No one was sorry to see Grachev go. But no one was impressed with the way Lebed handled his removal. Justifying the surprise firings, Lebed first said a coup had been in the offing. The hysterical language of coup and counter-coup strengthened fears in Moscow that the general might want to impose some sort of military rule on Russia.

Lebed hastily retracted his allegations when he realized that the only response in his new environment was raised eyebrows and skepticism.

But the fact that Grachev was his personal enemy undermined any belief that Lebed was doing more than neutralizing a rival power base. The appointment of a Lebed ally, Col. Gen. Igor N. Rodionov, as the next defense minister strengthened public suspicion that this was court politics as usual.

July was a month of especially ugly corruption allegations. With tempers still running high after a hard-fought presidential election, everyone was out to dish the dirt on everyone else. But instead of tackling the most visible vestiges of the previous administration’s corruption, Lebed went to ground.

For weeks in July and early August, he pondered the hard lessons he was being taught.

“Things were easier in the army. For now, it’s just meetings, meetings and more meetings,” a Kremlin aide said on condition of anonymity.

Lebed did not respond with visible enthusiasm to a crackdown on crime and corruption that Moscow’s mayor launched in public support of him. In the end, the campaign petered out, accomplishing very little. The sale of alcohol near schools and railway stations was banned, although kiosks disregarded the rule. Two casinos were shut down after Luzhkov ordered that the number of gambling joints in the capital be reduced from 72 to five.

“We can’t completely relax,” said the night manager at the glitzy Golden Palace casino, who identified himself only as Konstantin. “But it was only a figure of speech when city authorities were talking about cutting down to five. There’s already a new order that any casino that complies with regulations can operate. It’s just politics.”

Lebed also ignored separate coup allegations, this time by Chubais against Yeltsin’s two most influential “party of war” aides before July’s election--Alexander V. Korzhakov, Yeltsin’s former KGB bodyguard and later presidential security chief, and Mikhail I. Barsukov, head of the Federal Security Service, a successor agency to the KGB.

Korzhakov and Barsukov arrested two Chubais colleagues who, they said, had been caught removing $500,000 from the Kremlin in a cardboard box. Chubais accused his enemies of plotting a coup. They were fired, and he got a top Kremlin job in their place. The truth about the money was never fully explained.

Disappointed by what was widely seen as Lebed’s weakness, passivity and partiality, investigative reporter Minkin lambasted him publicly in an open letter to the newspaper Novaya Gazeta.

“Barsukov can’t, but Chubais can?” Minkin asked.

“The new idea which you have publicly chosen is . . . the idea which sends presidents, generals and ministers to jail. That’s the idea you have linked yourself to, if what you have in mind is real democracy. . . . Corruption, Mr. General, is in Moscow. In the Kremlin. Everyone knows that as well as you or I. It’s right under your nose. You don’t have to go out and find it.”

Lebed did not even try to punish the guilty when details of the lurid wrongdoings of his ousted enemies were splashed all over the Russian media. An expose of the undercover activities of the National Sports Fund, the pet project of Yeltsin tennis coach Shamil Tarpishchev and his inseparable cronies Korzhakov and Barsukov, ran in Novaya Gazeta on July 10.

The fund’s former boss, Boris V. Fedorov, accused Tarpishchev of having direct links with mafia dons, bolstering suspicions that the fund had been used to illegally finance Yeltsin’s extravagant reelection campaign. The paper said Korzhakov and Barsukov conspired in undercover financial transactions. Fedorov was in hiding abroad after a mysterious assassination attempt.

The fund was what the public liked least about post-Soviet Russia: the feeling that a sleazy elite was robbing the poor to feed the rich.

Its original aim--promoting sport--had been almost forgotten after it won the right to import tobacco and alcohol duty-free. Estimates vary, but some experts think the fund’s tax breaks cost the government at least $2 billion at a time when it was letting state wages go unpaid for months.

But Tarpishchev flatly denied he was involved in any corruption, saying the allegations were “nonsense which I am not going to comment on.” He got away with it and even went to the Olympic Games in Atlanta, taking Korzhakov and Barsukov with him on the international junket.

Lebed ignored it all. But on Aug. 9, he broke out of his self-imposed isolation and took back the initiative by going to Chechnya.

Events have so far justified his judgment that it was better to move straight on to tackling the current causes of corruption in Russia than to try sorting out the effects of the old regime’s misdeeds.

Since finding his feet, he has moved so fast that a rapturous Chechen crowd watching him sign the peace deal three weeks later could not resist yelling “Lebed for president!”

But there is still a long way to go if Russia’s new “Mr. Clean” is to flush corruption completely out of public service. Vast areas of graft that Lebed has not even touched still seem beyond his grasp.

His old-fashioned instinct until now has been for more state control of the economy. But protectionism in the Russian economy, with its artificially skewed pricing system for raw-material exports, has made it the most fertile breeding ground of all for corruption.

Domestic prices for oil, gold, diamonds and metals are lower than world prices. The officials who decide who gets the export licenses--and the chance of reselling at an instant profit on world markets--hold the wealth of the country in their hands. Cronyism and bribe-taking are rampant.

“In the long term I have hopes, but I am a realist,” said Mikhail Berger, an analyst at the daily Izvestia. “I don’t see an end to corruption without measures to reform the economy.”