#6 - RW 281
Moscow Times
November 6, 2003
Editorial
A Wasted Opportunity

Both sides in the Yukos affair seemed to be losing their grip on reality
this week. In Italy, President Vladimir Putin publicly drew highly
questionable comparisons between U.S. law enforcement's treatment of Enron
executives and Russian prosecutors' actions against Yukos core shareholders.

Yukos, for its part, splashed a banner across its corporate web site
proclaiming somewhat hyperbolically, "Your support for Yukos is support for
all of Russia," and Mikhail Khodorkovsky's defense lawyers published a
25-page "white paper" on violations in the Yukos case, which essentially
paints Khodorkovsky as Russia's Messiah who has been thwarted by evil,
authoritarian forces in the Kremlin.

Scrutinizing the Enron analogy, it falls flat on a number of counts.

For a start, none of those charged in the major U.S. corporate scandals
(Enron, WorldCom, etc.) have been held in pre-trial detention -- all were
freed on bail.

Second, Enron was essentially a pyramid scheme, while Yukos is a major
profit-making concern.

And third, Enron and its top executives were in conspicuously good graces
with the Bush administration, in stark contrast to Yukos and its core
shareholders.

Reading through the Yukos white paper, it makes some very serious points
regarding the egregious legal violations that have taken place in the
various Yukos-related cases. However, one can't help feeling that by laying
it on too thick and glossing over all the controversial parts of
Khodorkovsky's biography, the Yukos defense team has done their clients a
grave disservice.

We are told that, above all, it may have been Khodorkovsky's "vision of,
and support for, Russia becoming a free and open country with a robust and
active civil society" that brought about his persecution.

It goes on to say that Khodorkovsky's decision "to remain in Russia and
subject himself to the judgment of the Russian court system is part of the
fight he has chosen to wage on behalf of the country where he was born and
which he intends to see transformed into a country where fundamental human
and political rights are respected."

And that the "Yukos case is viewed as a watershed event that has taken on
universal and historic significance."

There is no mention, of course, about how the white knight Khodorkovsky
made his fortune or about the activities of Khodorkovsky and his fellow
oligarchs that did so much to undermine the integrity of the state and to
subvert the rule of law in the 1990s.

And, in the name of furthering the cause of human rights, will the defense
team be putting out white papers on other cases that qualify as politically
motivated, such as those of Igor Sutyagin or Nikolai Glushkov, the the
former Aeroflot executive and Berezovsky protege, who has been rotting in
jail for the past three years?

One of the great tragedies of the whole Yukos affair is that it is a wasted
opportunity to tackle, in a civilized fashion, the extremely important
issue of establishing limits on big business' influence over the political
process (the baleful effects of which were particularly keenly felt in
Boris Yeltsin's second term).

It is becoming increasingly apparent that the foolhardy and hubristic
manner in which Khodorkovsky waded into politics at least in part provoked
the attack.

However, instead of moving to strengthen the Anti-Monopoly Ministry and
introduce legislation to regulate lobbying activities and campaign finance,
the Putin administration opted to set the prosecutors' dogs on Yukos.

By refusing to tackle the issue head-on, we now have a situation in which
everyone stands to lose.