Who’s the Boss Now?

In a recent burst of activity, Medvedev pardoned 12 people, gave a wide-ranging interview to opposition weekly Novaya Gazeta-his first with a Russian newspaper-and met with liberal economists from INSOR [the Institute of Contemporary Development] as well as with human rights advocates. On April 21, a Moscow court unexpectedly ordered the early release of Svetlana Bakhmina, a mother of three and former lawyer for Yukos, the oil company formerly owned by Mikhail Khodorkovsky, the onetime oligarch who famously clashed with Putin and now resides in prison in the Russian city of Krasnokamensk. Why the flurry? Because, say sources, Medvedev want to distinguish himself without pitting himself against Putin.

The approach seems to be working. "Medvedev was a puppet, but now he seems to be doing things that may not please Putin," says Altai political scientist Yuri Chernyshov. It is unknown, for instance, what Putin thinks of the judicial changes that Medvedev has launched, but they are in high gear, sources in the Kremlin and in the establishment confirm. Medvedev's agenda includes improving judicial transparency and allowing judges to be appointed for life rather than requiring them to be reconfirmed by the Kremlin every three years—a proposal that is widely expected to be adopted. The point, as NEWSWEEK wrote last summer, was to shield judges from the influence of government officials, specifically the siloviki—the hard-line faction of Putin's inner circle. According to political scientist Stanislav Belkovsky, the effort has been at least partly successful. And Medvedev isn't stopping there. While other agency budgets are being cut, subsidies for the judicial system are growing.

Judges, of course, are the priority, but Medvedev is also moving forward in dealing directly with the government elite. He is clearly growing stronger, sources in the Kremlin say. One presidential council after another is being established-from anti-corruption to the development of an information-based society to the affairs of the disabled. In doing so, a source close to the Kremlin says, Medvedev is building his own power base: Officials sit on the councils, and this way he can give them instructions over Putin's head. "This has the makings of a potential conflict," says the source.

The situation has created challenges for Putin—in formal terms, it is now hard for him to reach the Foreign Ministry or his own siloviki. Since last fall, the flow of documents has been completely separated between the Kremlin and the White House. This means that work in both places is already running on an autonomous track. The risks of overlap are growing. Simply put, war has broken out between the bureaucracies, several sources assert, and instructions from the Russian White House and the Kremlin contradict each other with increasing frequency. A Kremlin source reports that, not so long ago, Medvedev held a meeting with ministers at his home in Gorki only to learn there that Deputy Prime Minister Sechin was meeting with agency heads to discuss the very same topic. "The routine has become jammed up," explains a source close to the Kremlin.

Further complicating matters, Russia's recession is gradually developing into a depression, forcing Putin to make important economic decisions himself-something he doesn't much like, says a source close to the government. In addition, Putin doesn't have that many confidants, the source says. Putin himself probably has less confidence in his inner circle already. "Putin has not been told the truth for a long time already," a source in the Kremlin says.

The bureaucratic conflict is unlikely to grow into anything more, however, simply because the symbiotic situation suits both Putin and Medvedev. Putin is comfortable because he still has the levers of control, and Medvedev finds things easier in Putin's shadow: There's less responsibility, but the presidential privileges are undiminished.

This report first appeared as a cover story in Newsweek's Russian-language partner, Newsweek Russky. It was translated by Steven Shabad.

© 2009