Why Putin Sacrificed His Economy Minister

The arrest of Russian Economy Minister Alexei Ulyukayev is a major move. It is likely indicative of deeper changes in the Russian power structure. The reason for the changes are not entirely clear at this time. Below is one take. -RW

Why Putin Sacrificed His Economy Minister

By Leonid Bershidsky

Russian President Vladimir Putin has been rather consistent lately in making it clear that senior officials were not immune from corruption charges. Yet Economy Minister Alexei Ulyukayev's arrest in the wee hours of Tuesday still stands out. It raises questions about the future of Putin's highly professional, technocratic economic team as well as one of the president's closest associates, Igor Sechin, who runs the state-owned oil behemoth, Rosneft.

In the last two years, three regional governors and the officials charged with fighting corruption at the Interior Ministry and the Investigative Committee (the Russian counterpart of the Federal Bureau of Investigation) have been arrested and jailed on corruption charges. As recently as Monday, three top officials from the Kemerovo region, Russia's biggest coal-producing area, were charged with extortion, prompting the region's powerful, long-serving governor, Aman Tuleev, to wonder aloud if he was the target of the investigation.

Putin hasn't really done much to dismantle the corrupt system that has flourished in Russia under his rule -- probably because graft is the glue that has held it together all these years. Yet he has appeared impatient with it since the 2014 Crimea land grab and the simultaneous oil price drop. No longer happy (or perhaps no longer able to comfortably afford) the crony capitalism of the 2000s, he wants a mobilized, militarized, patriotic nation that would circle its wagons against a perceived threat from the West and the economic difficulties that go with it.

Putin needed major corruption investigations to flag the change. Governors and top law enforcement officials were good chess pieces  to sacrifice: They had impressive titles, but they were replaceable.

At the same time, Putin needed to put some of his especially entitled cronies in their place, but since loyalty to friends is one of his cornerstone principles, Putin's old KGB colleagues and friends Vladimir Yakunin (the former railroad chief) and Sergei Ivanov (the former Kremlin chief of staff) were pushed into sinecures, or retirement, rather than strung up. Still, these moves were a message to the elite: This is almost wartime, Putin was signaling, so be helpful or get out of the way.

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