Shoygu's Attack On Army of Scandals

Shoygu's Attack On Army of Scandals
Russian Defence Minister Sergey Shoygu’s policy interview with the newspaper "Moscow Komsomolets" is called a show-off. He has never indulged the press with such manifestos for the past seven years. And yet Shoygu hasn’t answered any awkward question. The Russian newspaper Izvestia has fired the author of the article for criticizing the Defence Ministry head and the story itself has been removed. However, mass media report on the general of the army’s family business.

The surprisingly detailed interview caused an uproar in the press and social media. All of a sudden, the defense minister vigorously shared his thoughts on the revival of the Russian army for the first time in 7 years. He unashamedly took the credit for successful army reforms.

"Teflon" Minister

Shortly thereafter, Izvestia staff military correspondent Ilya Kramnik criticized the official but his article “PR and His Team: Defence Minister Sergey Shoygu’s achievements” was blocked just a few hours after the publication. The editorial board did not extend the contract with the author who had covered the work of the Ministry of Defense for a long time.

It was no coincidence that the article (the author kept it on his Facebook page) stated that the Ministry of Defense had become more closed under Shoygu. “An analysis of the Ministry’s operation, even if only based on public newsletters, suggests that the core activity of the armed forces is to carry out military patriotic and military sports events“, Kramnik said.

Former Defence Minister Anatoly Serdyukov allowed journalists to come to the Defense Ministry, while under Shoygu, the military press pool was reduced and loyalised, and almost all published information was devoted to the Young Army Cadets National Movement, the main cathedral of the Russian armed forces and the Patriot Park.

Apparently there is a reason behind the vigorous promotion of the Patriot Park located near Moscow. According to The Insider, this military Disneyland cost the Russians more than 20 billion rubles, and an additional two billion rubles will be allegedly allocated from the State Treasury. They say people have been volunteered to raise 2.3 billion rubles for a giant cathedral in khaki colors. The newspaper also found out how “Putin’s friends and the Defence Ministry administration” make money on this project.

“General Grebenyuk, implicated in a string of corruption scandals, became Park director, while General Timoshev was appointed head of the Supervisory Board. The latter is linked to the offshore which was used to withdraw the money from the bankrupt Investbank,” the news portal said.

It is noteworthy that amidst the scandals thinned by propaganda in servile mass media, the Ministry, for some reason, actually gave up its expert and analytical work, decreased the effectiveness of the Moscow Conference on International Security, closed the international exhibition Russian Arms Expo in Nizhny Tagil and nearly shut down the International Aviation and Space Salon MAKS in Zhukovsky, Kramnik said.

He suspects that his article was removed "due to administrative pressure". Meanwhile, the editorial board has not explained its position. Kramnik claims that "the deputy editor-in-chief read his story before publication" According to Podyem, a channel of Telegram blocked in the Russian Federation, Izvestia’s press service reported that Kramnik’s article had been removed for non-compliance with the periodical’s editorial standards.

The story “is not well elaborated and abounds with the views of the author, not the facts”. The journalist has lost his job because of a "violation of corporate standards." All of this suggests that Shoygu’s ways differ from Serdyukov’s, and that it’s better to keep one’s hands off the current defence chief.

Serdyukov turned off

Many said that Ilya Kramnik gave Shoygu another dig with his remarks that the defence minister could not be fully credited with the army reform and that it was incorrect to associate the reform with his appointment to this post in 2012.

“The process of alleviating “hardships and deprivation” aimed to improve living conditions, relieve soldiers of fatigue duties, reorganize the army food service and introduce other novelties. It was launched under Anatoly Serdyukov, Shoygu's predecessor. It is with Serdyukov that changes in service conditions are largely associated,” Kramnik said.

Rearmament and the signing of major weapons supply contracts began around that time. Also, successful combat missions in Syria in 2015showed that "the army rescue” was launched long before the appointment of Sergey Shoygu, he said.

Pavel Luzin, an international relations and security expert agreed with Kramnik noting that the reform of the Russian armed forces had begun more than a decade ago. “However, this point is overlooked. Shoygu stretches the truth as he says that he was the one and only behind all the success. It is not fair in regard to Serdyukov and his team,” Znak.com quoted the expert as saying.

“Indeed, all the reforms were launched under Serdyukov. By and large, Shoygu is mostly reaping their fruits. He completed some of the reforms, some are still ongoing and some have failed,” Dmitry Nekrasov, an economist and “Party of Changes representative” said in an interview with Radio Free Europe/Radio Liberty. “With all his changes and reforms, Serdyukov tried to lead us to some average western standards. Now many processes have reversed or, at least, slowed down, as far as I understand them. Many of Serdyukov’s reforms have not been carried through; at present, we are observing their impact rather continuation.”

“There were over 150,000 Colonels at the onset of the reform; Serdyukov ordered senior officers cuts,” said military expert Pavel Felgengauer. “The reform of military education, which they wanted to westernize and modernize, was entirely derailed by Shoygu. This will have to be dealt with in the future because the armed forces he has built have little resiliency in present and future armed conflicts.”

“I would like to remind that Serdyukov was fired when he tried to investigate the pricing mechanism of military goods. At this very moment everybody realized that it was none of his business”, military expert Alexander Goltz said in the same interview with Radio Free Europe. “The sphere of military production is completely out of control. The State Duma has no influence on the defense order. The defence order data is strictly confidential, we only know the approximate total defence spending which can change depending on the official who makes an address to the public. For this reason, it is hard to say anything about military production. It's more or less obvious that it's monstrously expensive.”

Everyone is our enemy, is a war coming?

It is no secret that the defence industry is one of the main growing items of state budget spending, unlike health care or education. Shoygu insists that we must not cut down defense expenditure in order to be able to compete with certain "external enemies". The minister said Audit Chamber head Alexei Kudrin’s opinion about the bloated defence budget was "moaning,"and advised Russian economists to think how to avoid small incomes rather than be afraid of high costs.

«That is a false message. Defense expenditure should be based on objective threats. What threats is the country facing now? He says nothing about it,” said Luzin. “There is a war in Syria. Fifty thousand Russian soldiers have gone through it. Once again the question arises: why do we need the rest of the one million-strong army? Maybe it is time to think about an army that suits Russia's needs and capabilities.”

“It's a Soviet approach that we are surrounded by enemies on all sides, and have to be ready for a big war,” Felgenhauer said. “The so called "war party" in the top leadership is not only the Ministry of Defense, the General Staff, but also the Ministry of Foreign Affairs, security services, etc. The 2020s are coming, it is the time of “big wars.” We have been preparing for this, and the rearmament program was targeted at this. Now it is necessary to prove that the money had not been wasted, that a trillion dollars had been spent to produce all these tanks and other things for a needless war. Therefore, Russia needs a bigger threat to justify the spending.”

Alexei Mazur, head of the Taiga.info Analytics Department, says that Shoygu's interview reflects the Kremlin's bureaucratic infighting. “Against the background of economic stagnation and the expected drops in income from oil and gas exports, a struggle for sharing the budget is unfolding in the ruling circles,” the journalist said. “The Defence Ministry looks pretty vulnerable here. In general, the reform of the Army has been carried out, the percentage of modern weapons has increased significantly, and the proposals to start saving on the army and defense orders sound more and more often.”

Defense of family boundaries

According to the Telegramm channel Shumanov, it is noteworthy that in respect to a possible staff war, Sergey Shoygu outlines his inner circle as clearly as possible. «Among his friends is Yuri Vorobyev, Deputy Chairman of the Federation Council and father of the Governor of Moscow Region, who has worked with Shoygu since 1991. Shoygu calls Ruslan Tsalikov his friend. The latter is his right hand at the Defence Ministry who has worked with Shoygu since 1994. Also among his friends is Valentina Matvienko. Maxim Vorobiev, the younger brother of the Moscow region governor, carried out with her son development projects in the Moscow region.

However, the defence minister flatly refused to discuss his family. "I am not going to let anyone into my personal life," Shoygu said in the interview with "Moscow Komsomolets", answering the question about his daughters' studies. “And, with all respect, I will not let you cut in there either. I will only say that my family members live a decent life, doing what they love.”

Yet, it is already known that only after graduating from Moscow State University, his eldest daughter Julia Shoygu got a job at the Center for Psychological Assistance of the Emergency Situations Ministry, and became its head a few years later. Taiga.info reports that among the largest suppliers of the state institution are the Moscow-based Massazhny Rai LLC, which received 21 contracts worth 47.3 million rubles for ultrasound therapy devices, defibrillators and simulators. In 2016, reports said that German hydromassage bathtubs HOSCH, which the company supplied to the Far Eastern branch under a government contract, had been manufactured in Bashkiria. It should be added that Yulia’s husband is Alexei Zakharov, Deputy Prosecutor General of the Russian Federation.

Shoygu’s youngest daughter Ksenia has recently been in the limelight, apparently due to her success in developing various kinds of business and getting profitable government contracts.

Known as the founder of the League of Heroes project, Ksenia Shoygu bought a 51% controlling stake in Capital Perform, which engages in advertising (according to the tax classifier). On top of that, the minister's daughter got shares in three other companies: Energy Resources Consortium (construction), Information Technologies (advertising facilities in Moscow and the Moscow region) and Arcius (driver medical examinations). Also, Capital Perform is involved in football pitch construction for the World Cup 2022 in Qatar.

The media also reported that a couple of years ago, Ksenia Shoygu became the owner of the Arctic Logistics Company with core business in cargo transportation. She is a member of the VostokUgol management company, which will develop "Arctic carbon" in the Taimyr coal basin in the future.

An unprofitable Information Technologies’ (the total loss amounted to almost 100 million rubles over the past few years), is obviously expecting improvements after the acquisition of stake by a daughter of such an influential official. Until 2018, fourteen billboards of the firm had been pledged to Gazprombank, where Ksenia happens to work as an advisor to the deputy chairperson of the Board.

“Artius has always been profit-making. According to the BAZA portal, over the past couple of years, the company has received 112 million rubles worth of government orders from Mosgortrans, "Autodepots of the State Authorities of the Krasnodar Region" and other state agencies. However, it seems that gracing company’s financial statements with her signature would be the only contribution by the Defence Minister’s daughter.

At one time, the restless Anti-Corruption Foundation accused Ksenia of buying two land parcels on the Rublevo-Uspenskoye highway, of total cost of $9 million. Her representatives said that “the information is not true”. Indeed, it turned out that Sergey Shoygu’s sister-in-law Elena Antipina acquired them in 2010-2012.

Useless scandals?

Sergey Shoygu calls all these publications and investigations by the Anti-Corruption Foundation “a repetition of the 1937 mass delation campaign”. “Why did they write delations? Some wanted to take the place of the one they wrote about, and some pursued other goals. The same happens today; we have a lot of public denunciations from internal and external customers.”

But what is the point of talking about “denunciations” if there is an enviable “success” of children and spouses of high-ranking officials? The wife of former Moscow mayor Yuri Luzhkov, Prosecutor General Yuri Chaika’s sons, the son of the above mentioned Federation Council speaker Valentina Matvienko ... The list can be continued, and all of them are well-matched prosperous businessmen, authoritative officials and graduates of the most prestigious universities.

“Actually, successful careers of children of the Russian elite are built either in state corporations and (or firstly) in public service or private business," Director of the Institute of Modern State Development Dmitry Solonnikov told Wek. “Only a handful can afford leading an idle life, being content with what they already have. It is anyone’s guess which of them can attract more attention. There is no direct violation of Russian law. Children and other relatives make their careers as if by themselves.”

According to the political scientist, first of all, business and career growth are formed by pragmatism of other entrepreneurs and managers. Of course, if your partner is a relative of a high-ranking official, it will be easier for you to get profitable contracts, even if no one makes extra effort to obtain them,” Solonnikov said. "If you have a relative of a world-level power player in your team, it gives you additional leverage in negotiations, top-down solutions and conflict management. At the same time, the children of officials are really valuable participants in these processes. They can resolve seemingly deadlocked situations. With their help, it is possible to save hopelessly unprofitable projects. The question is: where is the line beyond which the usual successful elite business and career growth ends and corruption begins?

In Russia, the management logic is not transformed yet. So, nothing unexpected or unpleasant will happen in all these stories either for Sergey Shoygu’s family or for anyone else. The question is what happens after that? How will the authorities transfer power, and what will be the rules of the game? After all, there are so many people interested in its outcome, we are now observing an increasingly emotional discussion of this very transfer. Nothing seems to have started yet, but how many moves and passions there are!”

“Indeed, there were numerous criminal cases against the Ministry of Defense under Shoygu’s administration," senior expert at the Gaidar Institute for Economic Policy Sergei Zhavoronkov told Wek. “Maxim Kuksin, head of the Defence Ministry’s Audit Department has recently been arrested. Earlier Alexander Gorshkolepov who headed the Property Relations Department, was convicted. There are many criminal cases against the abolished Federal Agency for Special Construction (Spetsstroi).

As for the Shoygu family, he hadn't seen any problems in it before. As Emergency Situations Minister, he appointed his other daughter Julia director of the Ministry’s Emergency Psychological Assistance Centre. I believe that these stories along with the above criminal cases against persons in the nomenclature and his area of responsibility will not directly affect him, but may become a cause and a sign of Shoygu’s decline. It is well known that apart from influential friends like Gennady Timchenko, Shoygu also has powerful enemies like well-known businessman Yevgeny Prigorzhin, and that not all of them belong to Shoygu's team inside the Ministry of Defense (for example, Deputy Minister and State Secretary Nikolai Pankov, a colleague of Sergei Ivanov).

Is it possible that the current emotional manifesto of the Minister of Defense is a big statement in the runup to the notorious "transfer of power"? Anyway, according to Goltz, this is a banal " front-page interview". "There is no point in making any claims: you either play this game or don't play...”