With Russia's autocratic leader Vladimir Putin ramping up his war of nerves against the United States and the West, evidently to take advantage of weak leadership in America, Karen Dawisha, director of the William E. Havighurst Center for Russian and Post-Soviet Studies at Miami University of Ohio, appeared at the Wilson International Center for Scholars recently to talk about her new book, Putin's Kleptocracy: Who Owns Russia?, the story of Putin's drive, along with his cronies, to re-establish an authoritarian state.
In part two of this article, Dawisha expands her critique of the Putin regime to encompass the charge that as early as the 1980s Andropov-trained KGB agents began to move capital abroad. This writer was drawn to the event by both its implications for the current relationship with Russia and interest in whether either Dawisha or the discussant, Elizabeth Wood, a professor of Russian and Soviet History at MIT, would address the complicity of American administrations in Putin's rise to power and the tightening of the grip of his cronies on the Russian economy.
Dawisha attributed this policy to an impulse by the Soviet elite to plan for the possibility that a democratic, multiparty system could emerge in Russia, a risk that the communists in Poland, East Germany and Hungary had neglected to prepare for. Dawisha charged that the looting of cash proceeded on such a scale that it undermined the Soviet regime as it started to collapse under Presidents Gorbachev and Yeltsin. She cited the work of Russian journalists who exposed these schemes during the time that free journalism flourished before Putin cracked down on it.
Scandals Dawisha documented include the Russian banking scandal; the food scandal in St. Petersburg, where Putin was deputy mayor; the development of the gambling industry in St. Petersburg, Putin's membership on the board of the St. Petersburg Real Estate Holding Co., which was registered in Germany and investigated by Interpol for laundering drug money from the Cali Cartel; conferring a monopoly in the St. Petersburg Fuel Co. to a group of gangsters; and converting funds from the Mayor's Contingency Fund in St. Petersburg to procure an apartment for himself. By the way, while the money laundering case was dropped, it led to Russia being placed on an international list of money launderers.
Dawisha went on to tell of Putin, having moved to Moscow and won the presidency, appointing his crony from St. Petersburg Vladimir Smirnov to head Tenex, the nuclear arms monopoly, which received $3.5 billion in U.S. aid and supplied materials for Iran's nuclear program.
The City Council investigated and found that the minimum amount of contracts awarded was $1 billion and the minimum amount documented as stolen was $122 million. The Council concluded that the contractors were led in the interest of the contractors and not the city, and it recommended that Putin be removed and prosecuted. The prosecutors sought to pursue the case, but they were stymied in their efforts.
Dawisha proceeded to explore an investigatory avenue unfamiliar to Americans and unreported by the mainstream media — Putin's establishment of a compound in Spain, to which he travels frequently, financed by the St. Petersburg Mayor's Contingency Fund. The author has confirmed through Radio Liberty that it has received 110 volumes of evidence from the investigators of this case. A criminal case still pending in Spain accuses Putin's confreres of laundering billions of euros.
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