The Russians Called Them 'The Oligarch Yids'

The Oligarchs: Wealth and Power in the New Russia. By David E. Hoffman. PublicAffairs, 567 pages, $30. My Jewish Fate. By Boris Usherenko. Self-published (in Russian), 381 pages, 100 rubles ($3.23).

S.A. Greene
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The Oligarchs: Wealth and Power in the New Russia. By David E. Hoffman. PublicAffairs, 567 pages, $30.

My Jewish Fate. By Boris Usherenko. Self-published (in Russian), 381 pages, 100 rubles ($3.23).

Sometime during the autumn of 1996, a small group of the most powerful men in Russia gathered in a villa in Moscow's Sparrow Hills district and worried aloud about anti-Semitism. They were Russia's famous "oligarchs," men who, in the aftermath of communism's fall, ran banks, oil companies, television stations and, increasingly, the country, and they had reason to worry: Most of them were Jews.

"In earlier years, when the moguls gathered to talk or make deals, when they dined in the villa in Sparrow Hills, or when they entered the Kremlin to warn Yeltsin, they were largely hidden from public view," writes former Washington Post Moscow correspondent David E. Hoffman in his recent book, "The Oligarchs: Wealth and Power in the New Russia."

"But in the autumn of 1996, it was no longer possible to conceal their ambition and their presence in the highest councils of the state. They worried, among themselves, about a backlash."

The threat of an anti-Semitic uprising never materialized. The oligarchs, and Jews in general, are frequent targets of the nationalist press, and extremist firebrands still occasionally call out their names in public, but the Russian street has yet to take up calls for their blood. Indeed, thanks to a rapidly opening and normalizing economy, the oligarchs may soon be a relic of Russian history.

If so, Hoffman's book will be a valuable record. Through careful reporting and unprecedented access to almost all of the major oligarchs themselves, Hoffman - now the Post's foreign editor - has ably picked up where his predecessor, David Remnick, left off after "Lenin's Tomb" and "Resurrection." It is difficult to imagine a book with more insight into the personalities and struggles that created today's Russia.

If the book has a flaw, however, it is in not answering one of the central questions it raises: Why is it, and what does it mean, that so many of these men - men who ruthlessly acquired and manipulated Russia's resources and, for a time, its government - are Jewish?

Of the six main characters in the book, four are Jews: Boris Berezovsky, now exiled and wanted at home for corruption, who at one point owned everything from auto-makers and airlines to banks and a TV network and earned the moniker "Godfather of the Kremlin"; Vladimir Gusinsky, banker turned media-magnate whose quarrels with President Vladimir Putin sent him into exile; Alexander Smolensky, perhaps Russia's most notorious banker, the collapse of whose bank in 1998 wiped out thousands of people's savings, and Mikhail Khodorkovsky, leader of Russia's second-biggest oil company, who survived political scandals and the collapse of his own bank. The other two - Moscow Mayor Yury Luzhkov and reformist-politician-turned-energy-czar Anatoly Chubais - are not Jewish, though that hasn't stopped nationalists from making accusations about Jewish heritage. (The book's index, meanwhile, contains at least another 25 prominent Russian Jews, including tycoons Roman Abramovich, Pyotr Aven and Mikhail Friedman and politicians Yegor Gaidar, Boris Nemtsov, Yury Skuratov and Bella Zlatkis.)

They were, by and large, men who learned early how to manipulate the system. Gusinsky bought copper wire on the black market to make the bracelets that funded his first fortune. Berezovsky did a brisk shuttle trade in German cars and Italian computers. Khodorkovsky used connections in the Communist Youth League to finagle lucrative software contracts. For many of them, particularly Berezovsky, Smolensky and Khodorkovsky, the resulting cash came in handy in 1992, when Chubais, then prime minister, handed every Russian citizen a voucher good for one share in about one-third of the country's economy. The nascent oligarchs used bought-up vouchers by the thousands and redeemed them for entire industries, some of which they proceeded to sell for scrap.

That, meanwhile, positioned them to take advantage of the next several rounds of privatization, in which key companies were to be sold via tenders. In practice, though, the small circle of key oligarchs nurtured contacts in the Kremlin, as Hoffman writes, to ensure that each won the tender he wanted. Chubais and other reformers, meanwhile, were willing conspirators. The way they saw it, mass privatization - even if massively corrupt - was the best way to rule out a return to communism. Eventually, they reasoned, the market would work things out on its own. But for most of the 1990s, the course of the Russian economy - and often of its government - was decided by the leading oligarchs in Sparrow Hills.

But by 1996, some of the oligarchs were beginning to worry. Nationalist politicians on the left and right were decrying what they called the theft of Russia's industry and the "oligarch Yids" who engineered it. For many of the oligarchs, it was by no means the first time they had been called "Yids," whether by Soviet bureaucrats or schoolyard bullies. Hoffman's book is replete with such detailed accounts. The fact that Smolensky and Khodorkovsky have mixed parentage, and that Berezovsky is a practicing Christian, was of no concern to bigots, then or now.

Their worries were not unfounded. As Berezovsky freely admits, none of them got where he was entirely honestly. According to Hoffman, Berezovsky built his empire on shady import deals, while Smolensky and Khodorkovsky dabbled in something resembling money laundering. When Smolensky's bank collapsed, he famously said that his bilked depositors "got what they deserved." Between them, Berezovsky and Gusinsky controlled the country's two biggest television stations, the leading news radio station and several of the largest newspapers and magazines. The fact was that the media in Russia was controlled by Jews; anti-Semites didn't really care which Jews in particular. Even mainstream politicians such as former Prime Minister Viktor Chernomyrdin didn't really like the idea; when Berezovsky and Gusinsky were embroiled in one of their public quarrels, broadcast for all to see on their respective television stations, Chernomyrdin said, "Two Jews are fighting and the whole country has to watch."

For anyone familiar with Russian history, the road from scandal to pogrom would have seemed perilously short.

Awareness of that history led the oligarchs in contradictory directions. On that fall evening in Sparrow Hills, the attendees - Berezovsky, Friedman, Gusinsky, Khodorkovsky and Smolensky - collectively decided that masking their Jewish identities would be the best option. A non-Jewish oligarch, Vladimir Potanin, was chosen to be their public liaison to government. Berezovsky was soon seen wearing a cross and attending Russian Orthodox churches. Still, no matter how hard they tried to distance themselves from Judaism, until very recently a glance at their passports would have given them away.

And yet less than a year earlier Friedman had joined Gusinsky and a handful of other prominent Jewish businessman in organizing the Russian Jewish Congress. Outwardly, the congress's aim was that of any Jewish group anywhere - to support synagogues, schools and other religious and cultural activities. But, according to Boris Usherenko, a Russian actor turned Jewish activist and journalist who documents his stint as the first executive secretary of the Russian Jewish Congress in his self-published book, "My Jewish Fate," fear of anti-Semitism also played a part.

At one of the congress's early planning sessions in late 1995, Usherenko writes, the founders' purposes were bluntly, if awkwardly, put. "Fiery speeches were made. [Chief Rabbi Adolf Shayevich] inspiringly contrasted the depressing past with the shining future. [Gusinsky] expressed his nostalgia for the old rusty pipe he used as a boy to beat anti-Semites. I remember [one attendee's] fierce defense of his ideal - Jews with machine guns."

It was not, however, the first time Jews were attacked for being at the vanguard of a tumultuous revolution. Before and after 1917, nationalists pointed to the heavy Jewish presence in the Bolshevik leadership, from Trotsky on down. Even today, Lenin's guttural "r" - the key element of what Russians refer to as "the Jewish accent" - is a running joke among Russian satirists; at least one of Lenin's grandparents was Jewish, which, as the satirists point out, would have made him eligible for aliya. To those who gathered both at Sparrow Hills and at the Chez Sergei cafe, where the Russian Jewish Congress was planned, the situation looked familiar.

Among those in attendance at Chez Sergei was Yevgeny Satanovsky, a successful but not quite oligarchic businessman who used the profits from his chemicals and metallurgy business to fund his Institute for the Study of Israel and the Middle East. Now president of the Russian Jewish Congress, he shrugs off the fears expressed by Gusinsky and others and sees "the Jewish question" - the one we asked earlier - as clear-cut.

"This sort of thing happens any time you have repression and then revolution," Satanovsky told the Forward afterward. "When you have a group of people who are repressed and then those restrictions are suddenly removed, all the extra efforts they have traditionally made in order to succeed propel them ahead much faster than the general population. It's a natural phenomenon."

In an interview with the Forward more than a year ago, Israel's Ambassador to Russia Natan Meron put it even more simply. In order to illustrate how much progress had been made since the fall of the Soviet Union, he displayed the front page of one of Russia's leading business newspapers, on which he had highlighted the name of every Jew. There were too many to count.

"Isn't it wonderful?" he said.

There was a time, of course, when the only Jews who made headlines in Russia were the demonized victims of the Doctor' Plot and other anti-Semitic Stalinist intrigues. That they have been replaced in the news by the oligarchs is, on the whole, probably a blessing. But in telling the next chapter of the story, Hoffman's and Usherenko's books both show how much remains the same. Russia is still asking its "Jewish question."

Whether or not the tone has changed, however, remains to be seen.

Equally unclear is the fate of the oligarchs themselves. Berezovsky and Gusinsky are in indefinite exile, after Putin seized both of their media empires. Smolensky, reviled after the catastrophic collapse of his bank, lives virtually in hiding. And Khodorkovsky, Friedman and many of the others now have minority shareholders and audit their companies by Western standards. The oligarchs may not yet be on the ash heap of history, but the days of the meetings up on Sparrow Hills are clearly gone.

By arrangement with the Forward.