The Oligarchs

In December 1985, Gorbachev brought a new boss to Moscow, the rugged Sverdlovsk regional party chief, Boris Yeltsin. Soon Yeltsin began to take the city by storm in a very unconventional way—standing in line with average people, riding the trolley, poking into factories and stores unannounced, prodding the stale, atrophying socialist system. The growing shortages of food in the capital were a special concern to Yeltsin. Hearing there was veal at a butcher shop—exceedingly rare—he once went and stood in line for it. He insisted on a kilo of veal and was told the store had none. Yeltsin then forced himself behind the counter and, through a small window, spied the back room—where they were handing out chunks of veal to special clients.²

Yeltsin touched a populist nerve when he publicly criticized the system of raspredelenie, in which the party elites had access to special stores and quality goods that were denied to the general public. He became a genuinely well-liked figure among Muscovites, but populist rhetoric could not fix Moscow’s ailing food distribution system. One after another, bureaucrats were given the job of straightening out the vegetable bases, and they were forced out in failure. In the summer of 1987, as the food situation in Moscow worsened, the fruit and vegetable bases were on the verge of collapse.

Yeltsin turned to Luzhkov, a stocky, bullet-headed industrial manager, who had been working as a senior-level administrator in the city government. Luzhkov was one of two deputies to the chairman of the Moscow city executive committee, the managers who dealt with the day-to-day affairs of the metropolis. He was the city official who handed out licenses for the first cooperatives.

The bureaucrat who previously headed the vegetable bases had just had a nervous breakdown. Yeltsin summoned Luzhkov. A mechanical engineer by training, Luzhkov did not want to take over the miserable vegetable bases, which he later recalled would be “an absolutely nowin situation.” But when he met Yeltsin, he softened. “He didn’t look at all the way I expected,” Luzhkov said of Yeltsin. “He seemed tired, depressed.” Yeltsin told Luzhkov the job would not be easy and then added, “I beg you.”

When he was a nineteen-year-old engineering student in Moscow, Luzhkov was assigned to a temporary student work brigade in Siberia to help bring in the harvest. It was October 1955. The weather was generally warm during the day, when they gathered and dried the hay, but it turned unexpectedly cold at night, often dropping below zero. The students got stranded; someone had failed to arrange their transportation back to school. For several nights, they slept in hay, shivering, many of them becoming ill.

The embarrassed, angry Politburo man demanded to know who was the boss of the brigade. Vladislavlev stepped forward. The party man signaled for Vladislavlev to get in his car and drove him twenty minutes across the barren Russian plain. A rain storm hit, and hail pelted the car under dark threatening clouds. Vladislavlev had no idea what was going to happen to him. Then, abruptly, the Politburo man told Vladislavlev to get out of the car, walk back in the hail, shirtless, and “finish the guy.”

Vladislavlev didn’t ask how to “finish” his friend Luzhkov. He just trudged back across the open fields, and when he returned to the camp, he recalled, he drank a bottle of vodka to keep himself from shivering to death. Soon the Politburo man called, “asking me what I had done to the guy. I said, ‘I finished him!’” In fact, he did nothing.³

The truculent Luzhkov of that day was to become a leader of the new Russia. Luzhkov had suffered through a childhood of poverty. Born September 21, 1936, he was the middle of three sons. His father was a carpenter and his mother a boiler room worker. The family lived on the first floor of a wooden barrack near the Paveletsky railroad station in Moscow. The three boys, their parents, and his father’s mother all shared one drafty room without heat or running water. All three sons shared one coat that their father had brought back from the war. Luzhkov’s memories were of constant hunger during the years of World War II and after. “I can’t describe this,” he recalled. “We always wanted to . . . not even eat, but to devour no matter what. Kids around us swelled and died from hunger.” Once the boys were so desperate they ate—and salted—“white clay” they found along the railroad tracks and became dreadfully sick.

Luzhkov’s most vivid memories revolved around the dvor, the courtyard, the center of his life as a youth. The courtyard was a world apart from the outside, “a small, self-organized community in opposition to the city and the state.” In the space between the buildings, they set the rules, the ethics, and the morals. “There were intellectual courtyards, but there were sporty and even thievish courtyards as well,” he recalled. “Ours was a hooligan courtyard, meaning that it provoked a special, risky mood—to get into a fight with somebody, to make yourself visible, to show some pluck.” Luzhkov said his mother was so busy working—she took two, then three jobs—that she gave the boys “total freedom to secretly indulge our passion for dangerous games.” Luzhkov was left to the “risky, reckless mood of the courtyard.” They often disassembled artillery shells from the war front that they found on railway cars nearby. They would take out the gunpowder, make a fuse with a trail in the dirt, and set off a small firecrackerlike explosion. Once Luzhkov had an idea: Why not set off the whole shell? He set the fuse and ran. A huge explosion followed, shattering windows. The police arrived, but the courtyard had its rules. No one gave him away. “The courtyard was as silent as the grave to the authorities,” Luzhkov remembered.

Later Luzhkov enrolled at the Gubkin Institute of Oil and Gas, one of the premier training grounds for the rapidly industrializing Soviet Union. In the high-ceilinged halls and laboratories of the institute, the Gubkin students learned mechanical engineering, oil and gas geology, mining and refining from one hundred professors, including two prestigious academicians. Although the requisite Marxist-Leninist training was present, the curriculum was heavily weighted toward technical training. Overall, the school played a critical role—turning out specialists—and each student was given a very specific training over five years to fit into a given place in industry when they finished.⁴

Luzhkov graduated in 1958. He expected to go into the oil industry but was assigned to plastics. He protested loudly, to no avail. Nonetheless, Luzhkov did well. Plastics and petrochemicals came into greater demand in the 1960s, and he moved up the ranks. In 1974 he was appointed director of a design bureau in the Ministry of the Chemical Industry, and later he became director of Khimavtomatika, a maker of specialized equipment for chemical factories with twenty thousand workers. It was the largest single enterprise in the ministry and was divided between scientific research and factory work. It was here, as a top Soviet industrial manager, that Luzhkov took his first, tentative steps away from socialism, and it was a painful departure, seared into his memory.

In 1980, at the end of the Brezhnev period, Luzhkov proposed a somewhat unorthodox idea, that the science half of his enterprise be put on a very elementary self-financing scheme. “Self-financing” was a watchword of earlier attempts to reform the centrally planned economy, and it often went hand in glove with the growing independence of factory managers. Roughly speaking, it allowed factories to retain their own earnings. Luzhkov suggested selling the research results at Khimavtomatika as a commodity; when they developed a scientific process, they could peddle it and keep the profits. Luzhkov’s proposal went to the top decisionmaking body of the ministry, the collegium, a group of senior managers who sat around a horseshoe-shaped table while an audience of 150 less senior workers looked on. Standing at a podium, Luzhkov outlined his plans. His idea was immediately and dramatically shot down by a representative of the Communist Party, who declared that Luzhkov wanted to violate the precepts of Marx and Engels. The party man opened up a volume of Marx and read aloud: science was the product of human thinking and could not be evaluated in monetary terms! Luzhkov was violating Marx!

At the beginning of perestroika, Luzhkov was fifty years old, but nothing at the time marked him as a political leader. By the same age, both Gorbachev and Yeltsin held high-ranking party posts.⁶ Luzhkov had joined the party in 1968, but his preoccupation was Soviet industry and not ideology. Nevertheless, it was common that a top industrial manager would be drawn into city affairs. In 1975 Luzhkov was chosen to serve on a local district council, and two years later he became a member of the rubber-stamp Moscow city council, known as the Mossovet. Its size varied, but the Mossovet at this time had about a thousand members. The entire city was run by the party, and the Mossovet was an enormous, unwieldy legislature, a facade of authority that decided very little. Luzhkov accepted a part-time post as head of the city commission on consumer services. It was an important choice because it was here that the seeds of change would be planted in Gorbachev’s early years of perestroika.⁷

In 1986 Luzhkov resigned from his industry post and moved full-time into the city administrative system. Yeltsin had arrived from Sverdlovsk and broke the news to Luzhkov personally; he had been made one of the deputy chairmen of the ispolkom, the city executive committee. His new duties included supervising the budding cooperatives in Moscow.

As already noted, the old party stalwarts of the time were suspicious ; they saw the entrepreneurs in the cooperative movement as profiteers, speculators, and subversive enemies of socialism. When Luzhkov set up a commission to license the cooperatives in Moscow, the whole experiment stood on wobbly legs. “This was a mission, a very dangerous one,” Luzhkov told me. No one knew if it could survive the dead hand of the old system, which had stifled so much individual initiative over the decades.

One unlikely champion of the cooperatives was a man who spoke in the dry, measured tones of a bureaucrat, Alexander Panin, a Leningrad management specialist who became Luzhkov’s right-hand man in dealing with the cooperatives. Panin was among legions of experts who, in between endless cups of tea and idle hours in their institutes, were supposedly working to perfect socialist management techniques. Panin, who had been discreetly reading Western management texts, concluded that the most important thing was to unlock the brilliance and imagination of individuals. He took a courageous decision and wrote a letter to the Communist Party Central Committee in Moscow. His ideas flew in the face of decades of party doctrine. He was summoned to the Central Committee offices at Staraya Ploschad, or Old Square, and the party people listened, for a while. Panin told me that, by necessity, he had to dress up his notion of individual initiative with a lot of rhetoric, insisting that allowing individual initiative did not contradict socialist dogma. The party apparatchiks told Panin they could not help him, but they urged him to keep spreading his notions and approach the Communist Youth League, the Komsomol, which had a little more leeway for free thinking about such things. Amazed by their reaction, Panin kept up his campaign. He suggested a modest experiment in individual initiative—allowing people to start their own cooperatives, which would be very small private businesses, such as baking pies. Finally, the authorities agreed to let him try, and Panin became executive director of Luzhkov’s Moscow committee on cooperatives—to oversee baking of the first pies of capitalism.⁸

Luzhkov and Panin began in a room as large as a dance hall on the sixth floor of the Mossovet building in central Moscow. Simple folding tables were brought in to one side of the room. The staff worked by day; then Luzhkov, in shirtsleeves, came in the evenings, usually after 7:00 P.M., often holding meetings with the new entrepreneurs until well beyond midnight. The new businessmen thronged the halls with their proposals, their paperwork, their questions, and their substantial problems, not the least of which were how to get supplies from the state-run economy and how to get a room or garage for their new venture. “Bearded, shaggy, and looking God-knows-how,” Luzhkov later recalled of his impressions of the new businessmen, “but all of them were energetic, independent, and interested. One was offering to produce useful goods out of waste garbage. Another found consumer demand at a place where the state structures had no field of activity at all. Ingenuity, inventiveness, creativity—we saw so much of it in our room.”

Luzhkov’s young, stern aide was Yelena Baturina, whom he married after his first wife died of cancer in 1988. Baturina recalled how the people who came to the room were so different from the bureaucrats who worked in the Mossovet building, and how shocked the bureaucrats were to find the ragged entrepreneurs in their halls. “We were constantly transferred from room to room,” she told me, “because neighbors complained that bearded, dirty people were sitting in the corridors and actually spoiled the image of the building!”⁹

Viktor Loshak, the Moscow News journalist who had been watching the drama unfold, recalled that Luzhkov had to defend the pioneering cooperative businessmen against bureaucrats who wanted to crush them. One group of bureaucrats were the fierce, large women who were official guardians of public health and safety. The bureaucrats had no idea that a new economy was being born in front of their eyes; they were supposed to uphold the dictates of the old system. “They resisted every microscopic step of the cooperative movement,” Loshak told me.

“And Luzhkov said, ‘Great!’ And two or three others said ‘Okay.’ Then the opposite side started looking for reasons why they could refuse her. ‘What is the size of your apartment?’ they asked. And it turns out the apartment is big enough. ‘Do you have a medical certificate ?’ She had a certificate. ‘Will you be able to go on taking care of your children?’ And it turned out her mother was in the same block of flats and could help.

“Then this bitch from the sanitary epidemiological service asked, ‘Do you have secondary industrial ventilation in your apartment?’ And this woman didn’t even know what that woman was taking about. Nobody knew what it was, and I didn’t know what it was. And that woman from the sanitary epidemiological service found some point number 3, article number 8, that when making cakes for sale there must be that industrial ventilation.

One evening in those early weeks, a party boss came and insisted that Luzhkov move “this entire public out of here.” Luzhkov explained that the whole point was to let off the steam of public discontent. “The wave is rolling already,” Luzhkov told the party man. “If we don’t cope, we will find ourselves under this wave.” At the same time, Luzhkov privately feared he was being set up for failure, that the cooperatives were going to be crushed and he would be blamed. “The future cooperators were eager to start business, but they were fearful of the future and they wanted to receive some kind of support from me. I cheered them up the way I knew how, but my heart was filled with anxiety and worry.”¹¹

Valery Saikin, chairman of the executive committee and Luzhkov’s boss, told Luzhkov that the nascent private businessmen were subversive and fretted that they might come and demonstrate openly against the party chieftains. “Objectively, they are against the state economy. Against socialism,” he said to Luzhkov. “I warn you: if they come to the Mossovet, you will be the one to go and meet them!”

Later, recalling those months of frenetic activity, Luzhkov said the evenings were not just bureaucratic work but offered a glimpse of the market economy—people anxious to work for themselves, not the state. “Dealing with the new people formed a new world outlook,” he said. “I began understanding things that before I used to guess only vaguely. . . .”

But things were never clear-cut at the beginning. The first tiny steps toward a market economy were confused, inchoate, and shrouded in suspicion. Were the new businessmen taking bribes or paying bribes? Reaping windfall profits? Luzhkov heard the rumors. The confusion was partly justified; Panin noted that the pies made by the cooperatives cost seven or eight kopeks each, compared with five kopeks in the state store. To the people on the street, that seemed like profiteering. Sometimes they were better, sometimes not. The cooperatives began the long march toward the market saddled with great suspicion in a society that had known nothing like it.

The first cooperatives were dramatically different from the old state establishments. The cooperatives actually cared about their customers. “In the Soviet Union, the counter was like a barricade, with enemies on either side,” Loshak recalled. “And suddenly they were not enemies. These people, the ‘cooperators,’ were interested in their clients, in having them buy something. When the first cooperative restaurant appeared, it differed drastically from all the others, from state restaurants.”

David Remnick, a Washington Post correspondent, described the amazing scene at the first cooperative restaurant at 36 Kropotkinskaya Street. He said the menu included soup, suckling pig, salad, and coffee. “So attentive was the management to good service that it soon fired one waiter for being ‘tactless.’ The café was a sensation not only for the well-to-do Soviets and foreigners who could manage the dual feats of getting in the door and paying the check, but also for ordinary people who heard about it in the press. There were rumors of fantastic profits being made and charges of ‘speculation.’ The Communist Party newspaper Pravda asserted that the new system allowed some people to make ‘significant sums that did not correspond to their expected labor.’”¹²

In this environment, Luzhkov was a curator of the new experiment who protected, nurtured, and monitored the cooperatives as they took hold. In his first four months, the number of Moscow cooperatives zoomed from four to more than a thousand. Luzhkov sponsored an exhibition of their work to mark the first hundred cooperatives and spread the idea. Yeltsin showed up to encourage him. A photograph shows Luzhkov admiring the exhibit stand of a cooperator making his own musical instruments. Baturina recalled, “The cooperatives worshiped Luzhkov because, out of all the official persons at that time, no one risked speaking out in their favor, in their defense.” But Luzhkov, who in later years was famous for roaming city construction sites, rarely visited the cooperatives. Panin said Luzhkov was still cautious and saw himself as a “monitor” of the new businessmen. Neither the party bureaucrats nor the public was really prepared for what was being unleashed, he recalled. “It was a test, as usual, in the beginning,” Panin told me. “You understand, if we hadn’t monitored them, they could have poisoned people or used bad raw materials. And had they done that—we would have had a lot of problems ourselves. That would have been the end of the cooperatives.”

As the cooperative movement blossomed, Luzhkov and Panin began to have their own private doubts. These ambitious new businessmen were rapidly overtaking the early concept of baking pies. They were branching out into work with Soviet industrial enterprises. They were experimenting with finance. The Law on Cooperatives had opened the door to private banks, and a few smart young men had figured out a way to launder government subsidies, intended for factories, into cash for themselves. They were obviously baking money, not pies. They were producing nothing useful for society, Luzhkov feared. “After the cooperative movement grew in scale and it became uncontrolled—then there was no stopping it,” Panin told me. “All barriers were removed. They were allowed to do anything, and then masses of people poured into the movement without any control.”

Loshak, the journalist, recalled that Luzhkov was outwardly still very much part of the system. He wore a black coat with a black fur collar and a fedora of the kind long favored by Communist Party ideologist Suslov. He was driven in an official black Volga car. But inwardly, Luzhkov sensed that the ground was trembling, even if he didn’t fully understand why. Loshak got a glimpse of Luzhkov’s changing mind-set one night in a long, soul-searching conversation with him. “We met after work; it was late at night, we sat together in his car. And we just drove around Moscow for a long time and talked. Our conversation was about down-to-earth things, about cooperatives and the people who came to the cooperative movement, about Moscow. We were beginning to understand something new in our life.”

Yet, Loshak added, Luzhkov never could have uttered those words at the time. Luzhkov did not imagine then that capitalism, markets, and private property might come to Russia. He was a “big boss,” a product of the system itself, Loshak recalled. “But at the same time, he was a real person, which made him different from others. His eyes sparkled. I think that back then, he understood that somehow, people’s interests must find a way out.”

In the summer of 1987, Luzhkov accepted the supposedly suicidal mission of managing the vegetable warehouses. He felt doomed. “Nothing could save it from implosion,” he recalled. In Moscow, discontent was growing over food shortages. One night, at a gala concert, the popular stand-up comedian Gennady Khazanov declared that Moscow “is the city of evergreen tomatoes.” It was a play on words from old hackneyed slogans about the Soviet Union being a land of evergreen forests. When he made the crack about the tomatoes, Luzhkov, who was in the audience, felt the performer looked right at him—and the whole audience laughed.

For Luzhkov, it was a moment of acute humiliation, and right after the show he stormed over to the tomato warehouse. “I was horrified,” he recalled. “I was pacing among the ‘evergreen tomatoes,’ squashed and rotting. I knew why they were like this.” In the next few months, Luzhkov, as with the cooperatives, began to search for a few limited market solutions in a sea of socialist folly.

Every day, thousands of people were drafted from their regular jobs to work in the vegetable bases. The workers were drawn from schools, hospitals, laboratories, and institutes, which ordered them to go to the vegetable dungeons. The work was miserable, but they had no choice. “The chilled, humiliated, dirty librarians, engineers, and doctors were working under the supervision of regular warehouse workers, who appeared in their mink hats and sheepskin jackets like nobility and evaluated their efforts in order to inform the district party committee,” Luzhkov recalled.

In a radical break with the past, Luzhkov decided to stop the forced march of ordinary Muscovites to the warehouses every day. He promised to save money by cutting back on waste and using the savings to pay his regular workers better salaries or hire part-timers. Luzhkov recalled the moment when a party official, standing at a large meeting, somewhat dryly announced that the city had stopped drafting people to work in the vegetable bases. It was just another line in the endlessly boring list of party “accomplishments.” Suddenly, the audience erupted in cheers, an outpouring of enthusiasm unheard of in such a setting. The party man was stunned and embarrassed. He later telephoned Luzhkov and demanded to know if a trick had been played on him.

Luzhkov figured that stealing in the warehouses was done by three different groups. Roughly one-third of the stealing was done by the workers, one-third by the truck drivers who delivered to the stores, and one-third in the stores. Luzhkov had an idea. If they lost fewer vegetables to spoilage, could they make more money and then pay people more—and perhaps reduce the stealing? It was a capitalist thought.

Luzhkov went to work on it. He asked his deputies for the official spoilage rate. The answer came back: 1 percent. “It was only then that I realized the pervasive cruelty of the system,” he recalled. “With all the monstrous losses of up to 30 percent in the storage process, the system had the nerve to demand a loss of only 1 percent. It was a laughing matter, a myth, a caricature—but there it was.... The Soviet system formulated its laws on the premises of an ideal people living within an ideal social and natural environment. As a result, it did not matter how good you were or how well you worked—at the same time, it also meant that no one could meet the established quotas.”

Luzhkov decided it was time for a change. He contracted a Moscow biologist’s laboratory to give him realistic spoilage quotas for fruits and vegetables. Then he got the ispolkom—the city executive committee—to issue an ordinance ratifying these as the new quotas. With the new quotas in place, Luzhkov told the workers they could sell, for their own profit, half of what they saved from spoilage. “Not a third,” Luzhkov intoned to the workers, “but half.”

But the higher authorities did not like it. In a reactionary spasm, Luzhkov was called before the committee of the people’s control, a party watchdog commission. The committee accused Luzhkov of fiddling illegally with the spoilage rates. They accused Luzhkov of paying “huge bonuses” to a collective. A crime! But after a tense hearing, the committee backed down, and Luzhkov was let off.

Luzhkov had survived the suicide mission, but he never won the kind of popular approbation that Yeltsin enjoyed. The reason was that the vegetable bases went from grim to somewhat better, but the Soviet Union was coming unraveled at the same time. Luzhkov despaired when Yeltsin, who had been a source of support, was dumped as Moscow party chief in November 1987. The following year, he shook the hand of Yeltsin, then an outcast, at a Red Square holiday parade. They spoke for several hours, and Luzhkov expressed hope that they would work together again.¹³

The Gorbachev years of perestroika saw Moscow seething with dissatisfaction, but the deepest source of discontent was rotten leadership more than rotten vegetables. When he came to the city, Yeltsin touched a raw nerve with his populist campaigns against party privileges. The reaction went even deeper among the intelligentsia. They were sick and tired of the gray bureaucrats and the party apparatchiks telling them what lines in a script could be performed or what books could be read or what statistics about life expectancy could be published in a scientific journal (i.e., none).

Gorbachev’s political liberalization unleashed a tidal wave of new thinking, and Moscow was awash in political clubs, interest groups, demonstrations, and ferment. What is striking about the rise of the “radical” democrats in Moscow is how randomly and even accidentally they all came together in a short period of time. The fall of the Berlin Wall in November 1989 had set the thinkers, artists, and professionals in Moscow afire.

Vladimir Bokser, a pediatrician who had also been an activist for an animal rights group, was one of the early democratic organizers. Bokser had the engaging manner of a friendly small-town doctor. But behind his calm demeanor lay a razor-sharp understanding of grassroots moods and politics. His primary interest was political freedom. He felt the intelligentsia was ripe for change. “Everyone came to understand that the leaders were not very honest people. They lie, they pretend,” Bokser recalled. “That’s what ended up uniting everyone. In a very precise way, at the end of the 1970s and in the beginning of the 1980s, a feeling of shame started rising.” The intelligentsia revolted against the Communists, and they revolted first in Moscow. Bokser told me, “It was a revolution of the intelligentsia, purely cultural. There was no other revolution at that time. Before 1990, none of us had even thought about a market to any degree. In fact, people feared that. Most importantly, people didn’t want these bureaucrats to sit there anymore, who decided everything for us, told us what films to watch; which books we ought to read. When people started watching what was happening outside the country, they wanted more openness. They wanted not only cultural openness but information openness. The first thing that happened was a revolution of openness, for an open society.”¹⁴

One of the strongest voices came from a man with a very unremarkable appearance—short and slightly hunched over, with a full head of salt-and-pepper hair and a small mustache. Gavriil Popov, an economist who had once been dean of the economics department of Moscow State University, was then editor of a journal, Questions of Economics. Popov had doubts about the system in the late Brezhnev years, and as perestroika took off, he was a prominent voice leading society toward something new. Popov was a close ally of Yeltsin in the new elected parliament, the Congress of Peoples’ Deputies, and he was constantly pushing Gorbachev to pursue more radical reforms.

The Moscow radical democrats were a loose group of political clubs, various associations for specific causes, human rights groups, and a host of curious and dissatisfied loners, many of them scientists. Under Popov, they came together to create a coalition, Democratic Russia. They decided to wage a campaign for the March 4, 1990, elections to the Mossovet, which had been reduced in size to 498 seats. This was a critical decision for the insurgent democrats—they decided to go local and make Moscow, not the national government, an engine for real change.

The democrats staged a noisy campaign: slogans blared from their megaphones in the subway underpasses, sound trucks roamed the streets. They had meetings in apartment houses, held two big street rallies, distributed thousands of mimeographed handbills, and put up posters in shops and the subways. They were the intellectual elite: among their candidates, 64.3 percent came from careers in higher education, science, engineering, the media, and arts.¹⁵

They scored a stunning victory, taking over the Moscow city government. They won 282 of the seats. On April 16, 1990, the newly empowered democrats assembled at the Mossovet and chose Popov as their chairman. The insurgents were ebullient to be capturing Moscow. They had shown they could compete with all those selfimportant men who had told them what to read and what to think. Ilya Zaslavsky, a chemical engineer who had been elected to the council, declared with boundless hope, “We will begin a new life.”¹⁶

But as Popov and the other victors were soon to discover, a potential disaster was hurtling toward them. Food shortages were mounting. Hoarding and panic gripped the city; hundreds of thousands of people flooded into Moscow from the provinces looking for food. Lines sometimes blocked the big avenues. Each wave of rumors spread more panic: meat was running out! Bread was almost gone! Six weeks after taking office, Popov acknowledged that “the situation in the city is getting critical. There is a real danger of things spinning out of control. Hundreds of thousands of people are in the shops.”¹⁷ Bokser recalled, “Everyone was expecting there to be a famine in Moscow. Maybe it was exaggerated, but everyone expected it.” A secret CIA analysis at the time reported the most probable outlook for the Soviet Union was “deterioration short of anarchy,” and one thing that could push it toward total anarchy would be “massive consumer unrest.” The CIA analysis said that any reactionary putsch, or takeover, would certainly target the radical democrats, including Popov.¹⁸

None of those around Popov knew how to manage the sprawling metropolis. His inner circle included Bokser and Vasily Shakhnovsky, a one-time engineer who worked on thermonuclear synthesis at the Kurchatov Institute in Moscow. Shakhnovsky had been drawn into the blossoming world of debates, clubs, and elections in 1989, and he was elected to the Mossovet.¹⁹ Another aide was Mikhail Shneider, a physicist at the Institute of Geomagnetism and the Ionosphere who had helped organize the elections with Bokser. Popov too was primarily a thinker. A common, albeit respectful jibe was that Popov needed to lie on the couch and think for several hours a day.²⁰ A theorist, even a bit of a romanticist, Popov did not think about potholes and streetlamps. He had no idea how many tons of vegetables were in the Moscow warehouses. He had no idea how to cope with the cigarette riots or the food shortages.

Popov feared that the radical democrats would be overwhelmed by their own lack of experience in governing. He was haunted by the idea that the whole experiment could fail; everything might collapse and they would be discredited, perhaps even jailed. It was just too heavy a test for the radicals, to make them run the whole city at the beginning. They were not ready. They needed a bridge to the old regime.

They also needed something from a long, deep tradition in Russian culture. They needed a real khozyain, a rich term in Russian that refers to the leader of a given social domain, a home, a village, an enterprise, or a country. The khozyain of a household, usually the oldest male, has responsibility for the welfare of the group. A real khozyain takes care of those in his domain. Russians tend to judge leaders on whether they give the impression of being a real khozyain—sometimes in appearance or in action. And a person who at least displays talents in this direction—who can manage the affairs of the day—is a khozyaistvennik.²¹ Popov was in search of one because he clearly was not. Popov turned to Yeltsin.

The radicals met every morning for breakfast in a large room behind the stage at the Mossovet building to talk about their plans for the day. Popov toyed with the idea of bringing back Saikin, the old party man, to run the city, but the radical democrats wouldn’t hear of it. He had other candidates from the old guard, but the radical democrats were dubious about them. Popov came to breakfast one day and reported that Yeltsin had suggested a candidate to manage the city—Luzhkov. But no one present knew Luzhkov.

The question hung in the air. Then someone recalled that the young cooperators, who were mingling with the new democrats, spoke highly of Luzhkov. Shneider recalled that he had just met Luzhkov. His first impression was vivid. “Soviet bureaucrat,” he recalled. “Style of his speech, the choice of words, vocabulary, appearance, the way he talked to people—all of that spoke that he was a true Soviet bureaucrat. Just the way I had imagined a bureaucrat, because I had never dealt with bureaucrats before.”²²

Luzhkov observed the democrats edgily, well aware that he was considered a member of the old guard, one of the apparatchiks whom the insurgents had vowed to throw out. He recalled that he was simmering with anger at the way the dissidents had blamed everything on the previous regime. He was “so enraged” by this that he decided to quit city government altogether. But then he went to the Marble Hall of the Mossovet to see the new politicians for himself. They didn’t look like bureaucrats; they wore no ties. Luzhkov, who had once been energized by the cooperatives, took a similar liking to the rough-hewn new democrats. They had none of the “blind obedience” of the previous generation, he thought.

“You were dealing with intelligent, active, angry people, denouncing the idiocy of the old system and promising to fix everything fast,” Luzhkov recalled. “These people greatly impressed me.” But he knew—better than they—what a mess they had inherited. The supply lines that held the Soviet Union together were snapping, virtually every day. As Luzhkov mulled the future, his phone rang. It was Yeltsin, who had made his own comeback. On May 29, 1990, Yeltsin was elected chairman of the parliament in the Russian Republic, the largest Soviet republic, and was pressuring Gorbachev for still more radical reform.

“This is Yeltsin,” the familiar voice boomed to Luzhkov. “Drop everything and get over here.” At Yeltsin’s urging, Popov chose Luzhkov to be city administrator and Luzhkov agreed. Popov told me years later that Luzhkov had several factors in his favor. He was never a top party boss. He had deftly managed the cooperatives, and Popov recalled that cooperative types had supported the radical democrats in their election campaign. Popov also knew Luzhkov had stopped the dirty, miserable work in the vegetable bases.²³

But the anger passed on the day Popov formally introduced Luzhkov as his choice before a meeting of the Mossovet. Luzhkov recalled that, at the moment of the introduction, Popov regarded him coolly. Popov made a curt introduction and then gave Luzhkov twelve minutes to explain himself. “I was shocked,” Luzhkov recalled. How could he address the crisis gripping the city in just twelve minutes? The members bombarded Luzhkov with questions. One question came from a radical democrat.

There was applause. The whole room broke into laughter. Luzhkov had unexpectedly disarmed the radicals and won them over. Shakhnovsky recalled that “this answer had a great influence on the democratic part of the Mossovet. This was a very bright answer.” They voted for Luzhkov. Popov was the political leader, but Luzhkov the khozyaistvennik.

The year that followed brought more decline, as the Soviet Union careened toward its final months. Yeltsin, Popov, and Anatoly Sobchak of Leningrad, all leading democrats, walked out of the Soviet Communist party in July 1990 and turned in their cards. Life in Moscow grew ever more bleak. In the early autumn of 1990, as snow began to fall, a terrifying panic hit: the potato harvest was rotting in the fields.

Luzhkov looked to traditional command methods to cope with the chaos, imposing such measures as identity cards for Muscovites to buy food. As the shortages intensified, black markets sprang up outside the shops. Prices skyrocketed for what little was available. Osovtsov recalled that Luzhkov decided to use the militia to enforce rigid price controls. It was a totally Soviet response. Osovtsov spent hours attempting to persuade Luzhkov it would not work—in desperate times, the scarce goods would get whatever black market price was set for them. “I nearly lost my voice trying to show him these were completely meaningless measures,” Osovtsov recalled. Rationing began in the major cities, including Moscow and Leningrad.²⁴

In the end there was no famine, but shortages grew severe. In early April 1991, visiting a Moscow food store, my colleague Michael Dobbs ran into a man surveying the meat counter. “There wasn’t anything here yesterday, and there isn’t anything here today,” the man said, gazing at counter, empty but for some ready-to-cook dinners of soggy sausage and congealed gravy. “I doubt very much there will be anything here tomorrow.”²⁵

The following summer, in 1991, both Moscow and St. Petersburg underwent a major political restructuring. The rubber-stamp legislature and a smaller, powerful ispolkom—both totally controlled by the party—were restructured into a more modern mayoralty. In Moscow, Popov ran for mayor and took Luzhkov as candidate for vice mayor. Popov had never shaken his reputation as a thinker and theoretician, and Soviet journalists referred to him by an affectionate nickname, “Hedgehog in a Fog,” after a popular animated cartoon film. Popov seemed sensitive to the point. In a television appearance during the campaign, he said, “We need to use the personnel available now in our own country—including the staff from the old Communist apparat. Luzhkov, in my view, compensates for a lot of my shortcomings.” ²⁶

The voters gave the Popov-Luzhkov team a huge endorsement. They won with 65.3 percent of the vote. Bokser observed a subtle change in Luzhkov. Before, Luzhkov had been a khozyaistvennik, a manager, while Popov played politics on the national stage with Yeltsin. But once elected as vice mayor, Bokser said, it was clear that Luzhkov was taking more and more power into his hands. After the election “it was as if he had become the heir of Popov, and he wasn’t the heir before the election.”

At 6:30 A.M. Moscow time on August 19, 1991, a group of discontented hard-liners, including the head of the KGB, tried to topple Gorbachev. They put him under house arrest at his dacha in the Crimea and called a general state of emergency. The KGB chief, Vladimir Kryuchkov, signed arrest warrants for seventy people, including Popov, Bokser, and Shneider. Popov was in Bishkek, Kirgizia, and would not be back until evening. Luzhkov, the acting mayor, got a telephone call at 8:00 A.M. from the city party boss, Yuri Prokofyev, who suggested that Luzhkov come to him “for instructions.”

Luzhkov faced a choice—to go with the coup plotters or to join Yeltsin against them. According to Shakhnovsky, who was with Luzhkov at the time, Yeltsin called and asked Luzhkov to come to his dacha outside the city. Shakhnovsky recalled that Luzhkov was the leader of the city that day, and had he announced support for the putsch, things might have turned out differently. Instead, he got in a car and sped away toward Yeltsin. His name was added to the list of those to be arrested by the KGB.²⁷

When he arrived at the dacha that morning, Yeltsin greeted him in an old T-shirt and slippers. He pointed to some apples on a windowsill and offered one to Luzhkov. “Moscow is with you,” Luzhkov assured him. “Thanks,” Yeltsin said. He urged Luzhkov to organize popular resistance to the coup. On the way back to the city, Luzhkov asked his driver to stop the car and change the license plates. They kept a spare set in the trunk. Just in case.²⁸

“I realized the coup plotters were going to fail when I saw that Luzhkov was wholly against them,” Bokser recalled later. “Why? Because Popov, for them, was a democrat and not one of them. But Luzhkov was a real khozyain. He had given so many people apartments, such as the head of the communications brigade, the pilot of the helicopters. All those people understood that in Moscow, the real khozyain was Luzhkov.”

The real heroes of the August days were Yeltsin and the tens of thousands of Muscovites who turned out in the streets to defy the putsch. Luzhkov was not a public figure in the tense hours of confrontation. But he did play a role behind the scenes. Since most of the central newspapers and television had been shut down, he kept Moscow’s telephone and radio channels open, especially Echo of Moscow, the radio station that helped antiputsch forces in the most critical hours. The Mossovet had been among the founders of Echo of Moscow because Popov liked the idea of an independent radio station. Soon after the coup began, the station sent a correspondent to remain at Luzhkov’s side. Alexei Venediktov, the director, told me that the link to Luzhkov was critical—it gave hope to all those who opposed the coup. There were reports that Luzhkov was organizing a defense, deploying trucks and volunteers, and ordering huge cement barriers to be set up. Luzhkov was on the air only briefly three or four times, but just knowing that Luzhkov was against the coup was important. “Luzhkov was a party member, an apparatchik,” Venediktov recalled. “If such an active member of the Communist Party as Luzhkov refused to join, that inspired hope.” Four times in three days, Echo of Moscow was thrown off the air but each time found a way to get back on.²⁹

Osovtsov recalled that Luzhkov remained cool and pragmatic, making lists of things that had to be done to defeat the coup plotters. “The conversation,” Osovtsov recalled of a staff meeting the first day in Luzhkov’s office, “was mainly about the building blocks to be delivered to the White House and Mossovet in order to circle the buildings; about cars with fresh drinking water for the crowds, about mobile toilets, and naturally about food and other similar things. The political aspect of the moment was clear.”

But then Luzhkov stood up and walked to the window. His office was now in a high-rise building with windows that looked out to the White House, the Moscow River, and the Ukraine Hotel. A single armored personnel carrier was stationed in front of the hotel, a distinctive gothic tower, one of the seven Stalin built. Looking out the window, Luzhkov spoke, as if to no one in particular, although the staff was sitting right there in his office. “Between us,” he said, “I will tell you. A coup is a colossal administrative undertaking.” Referring to the Communist Party veterans who had staged the revolt, he predicted, “These Komsomol members will never cope with it—no way!”

Luzhkov came out of the failed coup with a wellspring of respect in Moscow. For the first time, he was seen as a politician, not just as an apparatchik. As the coup attempt fell apart, Luzhkov faced the crowds in the streets and successfully persuaded them not to go on a revengeful rampage through the Communist Party offices at Staraya Ploschad. When angry crowds threatened to topple the statue of infamous secret police chief Felix Dzerzhinsky, Luzhkov had it taken down carefully by a crane, realizing that the eighty-five-ton monument could wreck telephone cables and sewer lines underneath if carelessly felled.³⁰

Popov also faced trouble in the city. He collided almost constantly with the Mossovet. There were strong suspicions that Popov was making his own business deals on the side. The food situation in Moscow and Leningrad was still deteriorating. Popov had never shaken his fear that everything they had done could fall apart, and he would be blamed.

In December 1991, just as the union fell apart, Popov told close associates he wanted to quit. They urged him not to. Shakhnovsky and Luzhkov went to see Yeltsin. It was the day the Soviet flag came down and Gorbachev relinquished the nuclear briefcase to Yeltsin. They asked Yeltsin to forestall Popov’s resignation. He did. In January, Popov again told a wider group that he would resign, but at a meeting of Democratic Russia, he was again persuaded to remain.

Bokser recalled that Popov was ill and suffered from constant back pain as a result of a mountain-climbing accident many years earlier. Popov was also losing interest in Moscow. He longed to join Yeltsin on the federal level, but there was no place for him, and he increasingly disagreed with the Gaidar government. In the city, it was Luzhkov, not Popov, who held the actual levers of power. On June 6, 1992, Popov resigned, leaving Luzhkov the leader of a chaotic, hungry metropolis of 9 million people.