Robbing the Robber Barons

Good spies make their living by not attracting attention. When they get caught, two explanations are possible: Either they slipped up, or they wanted to get caught all along.

Apply this logic to operation "Get Yukos," the hostile corporate takeover orchestrated by the FSB alumni running the Kremlin. If their goal was to confiscate the main revenue source of an influential and ambitious rival to the president, then "Get Yukos" is an unqualified success.

But it's hard to believe that the Kremlin would hatch a plan that entails the president compromising his integrity as well as parading the country's dysfunctional judicial system before the entire world.

President Vladimir Putin has publicly contended, without the slighest trace of irony, that the personal fraud and tax-evasion charges against Yukos founders Platon Lebedev and Mikhail Khodorkovsky are unrelated to the tax charges against Yukos itself.

"The case is about Yukos and the possible links of individuals to murders in the course of the merging and expansion of the company," Putin said in his first public statement on the issue back in September. "In such a case, how can I interfere with the prosecutors' work?"

How indeed? Another good question is how we got to the point where Yukos is about to be "de-privatized" for a back tax bill that it could easily pay if the government hadn't frozen all of its assets.

Putin sent the markets soaring last month when he announced that bankrupting Yukos was not in the state's interests. But he also said the judicial system should punish companies that don't pay their fair share of taxes.

If this were simply about taxes, then Yukos wouldn't be alone. Another major oil company, acquired just as cheaply and scandalously, paid taxes at the same, or even lower, effective rate during the years in question. The only apparent difference between the two is that Yukos is not known to swap favors with the Kremlin.

Taxes are not the issue. We are witnessing the manipulation of the system to achieve a desired result. The only question now is why "Get Yukos" has been such a public, clumsy and farcical game of judicial pursuit.

Either the spies in the Kremlin are struggling with serious command-and-control issues, or they intended from the start to make this a Russian "shock and awe" campaign. Either way you look at it, it's not good. In fact it's dangerous. A decade after privatization turned a handful of insiders into billionaires, the government seems to be modeling itself on the very robber barons it once vilified.

Russians and foreigners alike have every reason to be afraid.



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