Steve LeVine covers foreign affairs for BusinessWeek. He previously was correspondent for Central Asia and the Caucasus for The Wall Street Journal and The New York Times for 11 years. His first book, The Oil and the Glory, a history of the former Soviet Union through the lens of oil, was published in October 2007. Putin’s Labyrinth, his new book, profiles Russia through the lives and deaths of six Russians. It was released this week.

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A Blog on Russia, Central Asia and
the Caucasus

Monday, December 10, 2007

Putin Lays Out Russia's Future: The Gazprom-KGB State

For years, scholars, think tank commentators and journalists have been fond of a cute phrase to describe Russia: The KGB State. That's because of Vladimir Putin's KGB past, and the men who generally surround him.

But Putin's clever choice today of successor shows how he sees his country, and that's a hybrid -- what one might call the Gazprom-KGB State.

The levers of power will be distributed like this: Dmitri Medvedev keeps the money that's fueled Russia's roar back onto the world stage rolling in; and Putin keeps his hand in decision-making through his power base -- the FSB, the successor agency to the Soviet-era KGB.

Medvedev, who unless someone mightier than Putin intervenes will be Russia's next president come March, is chairman of the Russian natural gas giant. He's also of course Putin's deputy prime minister, but it's the Gazprom title that has demonstrated Putin's confidence in his 42-year-old protege.

Gazprom is the spearpoint of Russia's foreign policy. Through its control of natural gas pipelines, Gazprom is the instrument of Russian influence in its former colonies in Central Asia, the Caucasus, the Slavic states of Belarus and Ukraine, and even in the Baltics. And Gazprom is also Russia's lever of influence in Europe, where the company supplies 30% of the natural gas. That influence is likely to grow with the construction of new pipelines from Russia to Europe.

But what Medvedev doesn't have is links to the FSB, or any of the other security services. That means he's absolutely no threat to Putin's aspirations of holding on to power. If Putin had selected Medvedev's main rival, former KGB officer Sergei Ivanov, it would have sent a different message.

Last week, Putin proved that he's the country's most popular political figure in a massive sweep of parliamentary elections. Now he's moved to consolidate his position with the appointment of a milquetoast successor who seems likely to gladly stay on the economic side of power, and leave the rest to his patron.

We all assume that Putin plans not just to exert continued influence, but paramount power. Expect to hear more on that front.

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