Vladimir Yakunin - The Treacherous Path - An Insider's Account of Modern Russia

In many ways, this exchange exemplified how so many business deals at the time were conducted. It was precisely Russia’s volatility that made it attractive to foreign investors – it was regarded as a country where you could turn small sums into large fortunes – and plenty of others made a living out of this kind of arrangement, flying by the seats of their pants, but also carving out lucrative existences as middlemen. I made a substantial amount of money – 14 million roubles, if I remember correctly – from the germanium deal, but I knew that in the long run this kind of operation was not for me. I wanted to improve my knowledge, skills and understanding. I wanted to build and create.

My time at Temp came to an end when in 1998 I received a call from my friend Vladimir Putin, who was deputy chief of Yeltsin’s Presidential Administration. Putin, who I had known for a number of years by this point, knew that the idealistic spirit that had guided Temp from the beginning had started to sour a little, and that I would need little persuading to return to the government apparatus. He proposed a role that he thought I would be suitable for. ‘I suppose it is time for you to change your occupation,’ he said to me. ‘An opportunity has arisen. What do you think? If you agree, I can submit your CV.’

I would continue as a member of the Temp cooperative for a while longer, but my career as an active businessman was over, at least for a while. Huge numbers of people had rushed to join the ranks of new entrepreneurs during the ’90s, but not many lasted long. Even at Temp, with all the advantages we had, two thirds of the enterprises we began failed and very few things ever turned out the way we planned. But we were lucky that the other third was successful enough to subsidise the rest of our activities, and give us a decent standard of living. When we sold them, endeavours like the business centre made us a healthy profit. We had become a highly respected, prominent organisation. Civil servants were even sent to my office to be taught something of business and management.

Nevertheless, in 1998 I divested myself of both the successful enterprises and those projects that had never quite fulfilled the hopes we had of them – such as the Rossiya Bank, the bank formerly owned by the CPSU – and returned to working for the state.

Perhaps it was too romantic of me to assume that Temp could continue to work and live according to the principles we set out to follow; after all, even Israeli kibbutzim can fail to survive. But I am proud that I never wrecked anybody’s business, or anybody’s belongings, and I never let anybody down. We made money and we contributed something to society.

It is only now, over two decades on, that I have come to see those men from the Russian Communist Workers’ Party differently. They were poor, stubborn creatures unaware of their own obsolescence, though in their persistence there was a kind of melancholic dignity. But what I did not see then, what none of us saw, was that, unwittingly or not, they were a valuable reminder that, over the past century, we Russians have sometimes been so eager to usher in new ways of running our world that we have completely discarded everything that existed before. The baby goes out with the bath water, and whatever is good and valuable is lost along with the cruelty and the dross. But no ideological programme ever survives contact with the real world, no matter how seductive or complete its promises might appear. That Russia has been the graveyard of many utopias in its history is something that we all would have done well to bear in mind. How different things could have been.

It is said that people who have suffered an amputation are vulnerable to feeling phantom sensations in the empty space where their limbs used to be. They will try to pick something up with an arm that is no longer there, or attempt to scratch an itch on a leg that disappeared years ago. Most often, they feel pain. I sometimes think of this phenomenon when I consider the end of the Soviet Union. I am not naïvely nostalgic, I do not yearn to see the hammer and sickle flag flying again, and yet still I feel a nagging sense of loss.

The end of the Soviet Union meant the creation of a new border between Georgia and Russia, but many of us continued to regard the two nations simply as different parts of the same country. For three centuries we had fought and suffered alongside each other, we maintain many of the same traditions, and there are as many Georgians in Moscow as you might find strolling around the streets of Tbilisi. But after 1991, it was too easy for some to forget these shared bonds and in the summer of 2008, against a background of deteriorating relations between Georgia and Russia, gunfire and bloodshed returned to Transcaucasia, a region that had clung for years to a fragile peace settlement. The place of most intense fighting was in South Ossetia.

As you might expect, official communications between the two nations had been completely cut – even diplomats were no longer talking to each other – but despite this, the call I received on my mobile phone from Irakli Ezugbaia, the head of the Georgian railways, was not at all surprising. There was a long tradition of warm, constructive cooperation between our two networks, a legacy of the creation, almost immediately after the dissolution of the USSR, of the Union of Railways of CIS countries (made up of the former Soviet republics). It was decided then that the railways of the post-Soviet republics should work using the same regulations and share decisions on trans-border operations, with the head of the Russian railway system as chairman. The farsighted people behind the union knew that if every country introduced its own legislation and changes, the result would be chaos. It was an arrangement that had worked incredibly well for seventeen years, and one that we had seen endure even at moments of profound regional tension. Indeed, I would argue that the union helped promote constructive relationships among its members. (Though, for instance, Georgia left the CIS after the 2008 conflict, it remained an associated member of the CIS railway union.)

‘I am speaking to you as one professional to another, and would like to ask a question,’ Ezugbaia said to me. I could tell he was feeling awkward, because under the circumstances he had no idea how I would react. In polite, tense tones, he told me that they only had one week’s worth of grain stored in Tbilisi and that they were waiting anxiously for a transport of foodstuffs from Kazakhstan. The train would have to cross Russian territory, using our rail infrastructure. Could I permit it? he asked.

My immediate feeling was that, irrespective of the circumstances, the transit should continue. If we stopped it, then not only might there be severe humanitarian consequences, but we risked destroying the whole structure of the railway union. However, at the same time I knew that under the circumstances it would have been completely inappropriate for me to take a unilateral decision. Railways are not governments – their responsibility is not to make final decisions on foreign policy, but to carry passengers and cargo in comfort and safety – and so I said I would raise the matter with the Kremlin. A little while later, Prime Minister Putin (as he was then) called me and asked me to give him my opinion on the matter; what did I think should be done? Once I had explained the circumstances to him, and given him my assessment of the likely consequences if we stopped the transport, he ended the call – a little while later the grain was on its way to Tbilisi. The next time I saw the Georgian railway president, he simply said, ‘Thank you very much.’ It was a routine solution to a crisis situation in which two professionals had cooperated in the way that two professionals should. We did not even raise a glass in celebration.