President Yeltsin's dismissal of Yevgeny Primakov on May 12, and the announcement of his replacement with Sergei Stepashin, marks a sharp escalation of the political crisis inside Russia. This decision represents a radical measure by the president, who is conducting a desperate struggle for his own political survival. The failure of the Duma (parliament) to impeach Yeltsin and its ratification of Stepashin's appointment have revealed the close connections the Communist Party (CPRF) of Gennady Zuganov enjoys with a political system based on privileges.

On the finance markets and in the world of international politics the dismissal of Primakov initially led to panic regarding the continuation of the “reforms” that had been agreed in April between the International Monetary Fund and the Russian government. There was an abrupt fall on the Moscow stock market, the effects of which were even felt on Wall Street.

The dismissal of the prime minister occurred at a time of relative economic stabilisation, as the waves of last year's economic crisis were settling and foreign creditors were hoping for the, albeit late, repayment of their debts. Russian shares had recorded the highest growth rates of all “emerging” markets (73 percent higher at the beginning of May than at the start of the year). According to a series of Western finance analysts, the Russian financial market had the best chance of becoming one of the most profitable in the world this year.

Although Yeltsin has definitely sought to create an advantage for himself, his behaviour clearly shows that he has become one of the most important destabilising factors in official politics.

What occurred?

Three days before the Duma voted on his impeachment, President Yeltsin announced the dismissal of the Primakov government, which had only been formed last August, with the participation of the CPRF. As the new prime minister he appointed Sergei Stepashin, formerly vice-premier and interior minister.

The unanimous view of political commentators was that this decision had drastically worsened Yeltsin's chances, and that the impeachment procedure would probably muster the necessary 300 votes of Duma deputies. However, when it came to the vote on the most dangerous charge against Yeltsin—concerning the war in Chechnya—the CPRF and its allies in the “Peoples Power” group, the agrarians and the liberal Yabloko faction, fell short of the necessary two-thirds majority by 17 votes.

Votes on the other articles of impeachment went even more poorly: 263 deputies voted to impeach Yeltsin for the forced dissolution of the Peoples Congress of Deputies in the autumn of 1993; 241 for serious crimes surrounding the dissolution of the Soviet Union; 240 for the disintegration of the armed forces; and 236 for genocide of the Russian people as a result of the dramatically worsened living conditions since Yeltsin took office.

Crucially, the extreme nationalist Zhirinovsky faction were not present. Their deputies either claimed to be ill, or went to their dachas! The Chernomyrdin faction, “Our home is Russia”, also refused to support the articles of impeachment. In addition, 15 deputies of those factions supporting impeachment missed the proceedings.

So it came as no surprise that on May 19 Stepashin received the support of a majority of deputies on the first vote. After three hours of debate and questions, 301 voted for his confirmation and only 52 voted against.

What lies behind Primakov's dismissal?

The war in the Balkans was clearly the most important factor that had caused Yeltsin to change his cabinet. The impending impeachment proceedings and the “Berezovsky” factor also played a role.

The events in Yugoslavia have shifted relations inside the ruling establishment strongly in favour of the nationalist forces.

From the start, the Primakov government was a government of compromise. It was formed in the immediate aftermath of the finance and economic crisis of August 1998, under the pressure of the biggest group of lobbyists. Expecting catastrophic consequences to follow the financial collapse, they sought to close ranks: Primakov rested on a majority in parliament, and for the first time in the post-Soviet era, representatives of Zuganov's Communist Party were included in the government.

This government came at just the right time for Yeltsin. He needed a breathing space, as the attempts to implement a further liberal “breakthrough” under Sergei Kirienko had led to a colossal collapse. The president had not only lost the support of broad sections of the population, but also of significant parts of the ruling elite.

The political stability sought under Primakov had already begun to show its first rifts in early 1999. The IMF froze credit payments and was in no hurry to restart negotiations with Russia. At the same time, attempts to find those responsible for the crisis the previous August led to the uncovering of corrupt intrigues in the immediate vicinity of the president. Investigations into the firms “Fimako”, “Mabetex” and “Aeroflot”—begun under the auspices of the attorney general, the Duma and the prime minister's office—began to pose growing dangers for various people in Yeltsin's immediate circle.

Amongst these was the oligarch Boris Berezovsky, whose position had already been weakened by then. Berezovsky had succeeded in combining his own interests so closely with those of the Yeltsin family that it would have been impossible to disentangle his personal fate from the political fortunes of the president. Like it or not, Yeltsin had become the protector of the oligarch from the arm of the law.

The conflict between Attorney General Y. Skuratov and Berezovsky became the central axis around which the disputes within the ruling layers revolved. In February, the first discussions about removing Primakov from office had already begun; the need to obtain new credits from the IMF served as the formal grounds. In March the president signed a decree sacking Skuratov. The refusal of the Federation Council to support this presidential decision sharply posed the question of a change of government.

However, the war in the Balkans intervened. The liberal politicians immediately disappeared into the background, as they were fearful of openly defending the NATO bombardment. They willingly left the stage for the nationalists; and this supplied Primakov with a stabilising impulse.

Yeltsin's attempt to use his recently appointed special envoy, Viktor Chernomyrdin, as the answer to the Balkan crisis did not bring him the necessary results. The president was, for all practical purposes, left with no other choice than to dismiss the government. In this way he hoped to create a new relationship of forces and preserve at least a minimum of political initiative on the eve of the parliamentary and presidential elections

Stepashin, barely confirmed in office, sought to remove any doubts regarding what course his future policies would take. This political officer and head of the secret service who, especially according to Western commentators, had shown a lack of understanding of economic questions in the previous weeks, now promised to continue the reform policies with even greater discipline. He also pledged to work even more closely with the international financial organisations. The draft laws agreed with the IMF as a condition for obtaining new credits would now receive the highest priority.

At the same time, he praised unity with the Communists. To help them save face for having supported him, he formed various commissions: against capital flight abroad, against corruption and to resolve the problems of the defence industries.

The appointment of Stepashin as the new prime minister shows that there only a few people left on whom Yeltsin can rely. As a political figure, Stepashin possesses very little weight. He is a typical apparatchnik, without any clear views. Of the three ministers who had to hang up their hats after the inglorious defeat in Chechnya, he is the only one to have regained a toehold in the corridors of power. As a strongman for Yeltsin, he has now become irreplaceable. Yeltsin has given him wide-ranging powers, hoping in this way to tie him firmly to his presidency.

At the same time, the nomination of a figure like Stepashin creates strong tendencies inside the presidential circle to fall back on methods of violent repression. There are continual denials that a coup is in the offing. When the new prime minister, a former police and secret service chief, presented himself, he said: “I am not General Pinochet, I am called Stepashin.” This is a clear reference to the “Chilean model”, much-discussed in Russia.

In the last 15 months the government has been replaced three times. This fact alone indicates a deep political crisis. Each successive change in government has only provided a short breathing space, after which the old conflicts break out even more sharply. The reason for this is the impossibility of a normal development of the capitalist market in Russia. Capitalist restoration has led not to an upturn, but to the total collapse and virtual de-industrialisation of the country.

The dismissal of Primakov has banished to the past the spectre of political stability, which briefly flickered on the horizon of Russian politics. The Russian ruling class requires unity and compromise in order to continue to lead the country in the face of the dramatic impoverishment of the population and the growth of mass protests. However Stepashin, despite all the present statements to the contrary, will seek this in vain.

Yeltsin's actions are increasingly determined by his own personal motives, whilst his decaying government descends deeper into the abyss, calling to mind the last years of the Romanov dynasty.