Khodorkovsky verdict: The time bomb goes off

The decision in the latest trial of Mikhail Khodorkovsky was a long time coming, and no one should be surprised at its results.

According to the verdict handed down by Moscow’s Khamovnichesky District Court, Mikhail Khodorkovsky and Platon Lebedev won’t be freed before 2017. The trial saga is over, with both ex-tycoons convicted of embezzlement and money laundering. The judge upheld the charges on all major points.

Of course, defense lawyers will appeal the verdict, doing their best to find justice in the Moscow City Court. There is also the possibility of a presidential pardon. At the same time, the latest trial highlighted one of the biggest problems faced by Russia today: The questionable legitimacy of the fortunes built in the 1990s. This problem is exacerbated by the fact that it is these very fortunes that remain the backbone of the Russian economy.

 

This is a vicious circle: We can’t go back to the point where the law was broken and play the record anew, as it would be done in Europe. This would shake the very basis of the Russian economy. And yet, such a burden seems far from safe, not least of all for the “beneficiaries” themselves.

It is this argument that was highlighted by critics of the verdict, many of whom themselves cashed in during the 1990s. They say – and with good reason – that the Khodorkovsky case sets a dangerous precedent, raising questions over the legitimacy of Russia’s leading companies. Their voices are echoed by those in the West, including U.S. Secretary of State Hillary Clinton and German Foreign Minister Guido Westerwelle, who both urge Russia to “respect the law.”

 

Interestingly, before Khodorkovsky was arrested in 2003, western leaders and media also called on Russia to observe the law, but in the opposite direction. They strongly recommended that the Kremlin rein in Russia’s homegrown oligarchs, calling them “robber barons” (the New York Times used this term recently to describe the Khodorkovsky of the 1990s).

On July 8, 2002, German magazine Spiegel wrote of Khodorkovsky: “The new tsar of black gold is only interested in politics to the extent it helps or prevents his business projects… Democracy was the last thing he cared about when, in cooperation with other tycoons, he organized and bankrolled [Boris] Yeltsin’s election campaign in 1996."

And this is followed by an interesting quotation: “We could be reproached for breaching fair election standards, but of all the alternatives available at that time we chose the best possible scenario for our country,” said Khodorkovsky to the German magazine.

Following his falling out with Vladimir Putin and arrest in the summer of 2003, the western media changed its tone, turning Khodorkovsky into a symbol of civilization and democracy.

 

As always, the truth lies somewhere in the middle. Was the law abused during the creation of the oligarchic giants like YUKOS? There is no doubt about this, and the Khamovnichesky court confirmed this. Were Khodorkovsky and Lebedev the only ones to enjoy the opportunities available? Certainly not. The time bomb, which went off at the end of December, was planted long ago.

The mechanism for building large fortunes, launched in the late 1980s and reaching full capacity during the second wave of the privatization campaign, which began around 1994, already implied the selective use of justice, of which Khodorkovsky’s supporters now accuse the court. The owners of oil companies, lucrative plants and steel works were in fact all appointed by the state, which thus tacitly guaranteed them immunity from prosecution. In addition, a complicated and non-transparent system of ownership and property management was created purposefully to make the real lords immune.

The use of various subsidiary firms, front companies and puppet figures of all sorts came to light prominently during the latest trial. “Real solutions were made by Khodorkovsky, but responsibility was borne by the persons who signed the documents,” said Judge Viktor Danilkin in his verdict.

Did that really happen, or are these simply trumped-up charges brought by Khodorkovsky’s enemies? All those things indeed took place, but not just in YUKOS. Many Russians were affected by that system, in one way or another: during the 1998 default, when banks had no funds; during the capture of alumina works with their aluminium, oil wells with their black gold and research institutes with their capacious premises; during the many periods where wages were not paid for months on end; and by many other situations when it became clear that ordinary citizens were denied the privileges offered to the “elect.” It is difficult to find justice because laws are always interpreted in favor of the elect. 

 

So, selective justice was not invented yesterday, and it is for this reason that the arguments used by Khodorkovsky’s supporters do not strike a chord with ordinary citizens. If they had to put up with selective justice in the 1990s, why should they protest against the same system now?

Perhaps, this explains the lack of public interest in the second Khodorkovsky trial: according to data published by the Levada Center, only 2 percent of respondents followed all the twists and turns of the trial saga, while 12 percent said they showed interest from time to time.

Meanwhile, those who created the system of selective justice in the early 1990s said they were acting out of necessity, and ultimately in the best interests of the entire society. There was a need to quickly build a class of large owners in the country, they claim. For a long time, it seemed that the doubtful choice made in the early 1990s became a thing of the past and should be forgotten.

But alas. In this life, you have to pay for everything, and for big money you pay in kind, sooner or later.

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