SPEAKS IN RUSSIAN
CHANTING
For over a decade,
Vladimir Putin has been the undisputed master of Russia.
But after claims he fixed parliamentary elections,
tens of thousands of middle class Russians took to the streets,
demanding his resignation.
They put on a symbol of protest -
white ribbons.
Putin has announced his intention
to remain in charge for at least six more years.
This is the story of how he dominated Russia,
tried to dominate its neighbours, and how the West dealt with him.
It began in 1999.
Russian President Boris Yeltsin was desperate to fill a key post.
His eyes fell on his intelligence chief.
Four months after he was appointed Prime Minister,
Vladimir Putin was summoned by President Yeltsin.
It was a few days before the millennium new year.
As soon as Yeltsin resigned, Putin became President.
He set out to restore Russia as a great power.
It made the world uneasy about him and his country.
He spent his first night as President with the front-line troops
fighting to reverse Russia's humiliation in Chechnya.
EXPLOSIONS AND GUNFIRE
By the time Putin was elected President,
Russia's forces in Chechnya had pushed the rebel fighters into the mountains.
The mountain village of Shatoy was one of the last rebel strongholds.
Putin's triumph boosted his popularity.
But in Moscow, he could not be an effective President
while the government remained a mess.
It regularly went broke, failed to provide basic services,
and had to be bailed out by billionaire oligarchs.
Putin appointed a new prime minister
and told him they must finally tackle Russia's biggest problem.
The first step was to get Russians to pay their income tax.
So Putin's ministers proposed a massive cut,
to just 13% for all, even the rich.
The Prime Minister himself was worried.
Putin knew that his reforms could not work
unless he faced down Russia's business elite, the oligarchs.
The oligarchs were used to popping into the Kremlin
to twist government policies.
The oligarchs who wielded most political power were media barons.
In Putin's first month, one, Vladimir Gusinsky, was arrested.
Gusinsky was released
only after he agreed to sell his television network
to a state-owned company and leave Russia.
It was the first step to Putin's taking control of Russian TV.
Then Putin called the other leading oligarchs to the Kremlin.
This meeting would radically change the rules of the game
for the oligarchs.
These men had won the decade-long struggle
for Russia's natural resources.
On the left, the CEO of Gazprom, the world's largest gas company.
The boss of Russia's biggest oil company is next to him.
These three made their fortunes in advertising, aluminium and oil.
This man controlled the largest nickel company in the world.
The leading bankers were there.
So too was the owner of Russia's fastest growing oil company,
Mikhail Khodorkovsky.
He told what happened right afterwards.
But everybody there knew Putin had just stripped
one oligarch of his business
and forced him into exile.
The oligarchs had, Putin thought, been cut out of politics.
Now he faced an even more powerful opponent -
America's new president.
The challenge came soon after George W Bush was inaugurated.
The Cold War was over but distrust still lingered.
Both sides maintained huge nuclear arsenals.
Agents lurked in both countries' embassies.
There was an agreement between the sides over the years
that you could have so many people within each other's country
who were essentially spies, they were intelligence people.
But gentlemen understand these things
and as long as it was within limits then it was accepted.
But the Russians had been, shall we say, ignoring the rules
and they'd been adding more and more people.
The FBI asked the new Secretary Of State to expel 50 Russian diplomats.
He made an appointment with the Russian Ambassador.
He came in just for a courtesy call.
We drink a little tea, we shake hands, we, you know,
we have a nice conversation. "Dobre", "How are you?", "Spasibo" -
all the nice courtesy words that are used between Russian
and Americans, and instead he walked out with a problem.
A major problem.
The Ambassador took away a list of Russians to be expelled.
Then the Secretary of State tried to limit the damage.
He said, "Are you really going to do this?
"Is this how you want to start out a relationship?"
I said, "Yes, we're going to do this,
"and we have to have a relationship that's based on trust."
Powell expected the Russians to expel an equal number
of American spies - and that would be that.
But he hadn't reckoned with the secretary of
Russia's National Security Council -
like Putin, ex-KGB.
The Russians carried out their threat.
The Americans feared it would derail the President's big idea.
They wanted a missile defence shield
to protect America from nuclear attack by rogue states -
like North Korea or Iran.
But this was banned by the Anti-Ballistic Missile Treaty,
signed when Russia and America faced each other
as enemies in the Cold War.
Russia and the United States
should work together to develop a new foundation for world peace
and security in the 21st century.
We should leave behind the constraints of an ABM Treaty
that perpetuates a relationship based on distrust
and mutual vulnerability.
President Bush sent me to Russia.
The conventional wisdom of the nuclear priesthood
was that Russians would never go along with this issue.
We made the case to the Russians that missile defences
were not about defending Russia against the United States
or the United States against Russia
but defending both of our populations against third countries.
We got a fairly chilly reception.
The Russian side have raised some serious and important questions.
We began to give them some answers to those questions.
We've done a lot of thinking about this subject.
We'll obviously have some more thinking to do.
'The message we brought back to President Bush'
was that if this was going to be done,
it was going to have to be done top-down.
He was going to have to do it with President Putin.
The highlight of George Bush's first presidential trip to Europe
was another first - a summit meeting with Putin, at a castle in Slovenia.
Then they go off to be by themselves
while the rest of our delegations are busy sitting around
pretending to have a conference and discussing vital issues,
but we're all just sitting there tapping our thumbs
and our fingers on the table,
wondering what these fellows are doing.
Only the translators and the two national security advisors
stayed with the presidents.
After the initial pleasantries, Putin delivered a prophetic warning.
Putin turned quite, er, dramatically to Pakistan,
accusing the Pakistanis, saying
it wasn't just that they supported the Taliban, but in fact they were
feeding extremists into Afghanistan
and they were a lot of the problem.
And basically saying this is going to explode, on your watch.
The warning fell on deaf ears.
Instead, President Bush pitched his idea to Putin
that the Anti-Ballistic Missile Treaty had outlived its usefulness.
Despite being rebuffed,
President Bush was keen to show the meeting had been a success.
Question to President Bush, is this a man that Americans can trust?
That's one of those trap questions
that when you're the Staff person,
you think, "Oh my goodness, I wish we'd gone over that."
If the President says, "No, I don't trust him",
then the relationship's off to a very bad start
and if he says, "Yes, I do trust him",
then people think, "Oh, well, that's naive".
I'll answer the question.
I looked the man in the eye -
I found him to be very straightforward and trustworthy.
We had a very good dialogue.
I was able to, um...
..get a sense of his soul.
(Good job.) Thank you. Good job.
For me, as a rather practical guy and a soldier,
I was taken aback a little bit by it.
And thought perhaps he shouldn't have gone that far.
And in fact, I said to him later,
"Well, you know, you may have seen all that,
"but I still look in his eyes and I see KGB."
Remember, there's a reason he's fluent in German!
He used to be the resident in Germany and he is a chief KGB guy.
Putin had BEEN KGB, but by now he had turned his back on communism.
In Moscow, he took on the Communists.
He proposed a law to legalise the right to buy and sell land,
something the Communists had been fighting for years.
THEY CHANT
Russian parliamentary rules require the minister responsible
to read out a bill before it is voted on.
This gave the Communist members of parliament their moment.
Putin's reforms began to work.
For the first time since the collapse of the Soviet Union,
Russia had a budget surplus.
Wages and pensions began to be paid regularly.
But Russia was still far from its former superpower status.
Then came 9/11.
In the White House bunker, Bush's national security team
put America's military on a high state of alert.
We're going to go to DEFCON 3.
Everyone had always feared the so-called spiral of alerts.
We go to an alert level, the Russians follow
and pretty soon everybody's at a very high level of alert
and that can be very dangerous.
And so, erm, I thought to myself,
"I'd better get a hold of the Russians and let them know."
I remember President Putin saying,
"We know that your forces are going up on alert,"
and it occurred to me of COURSE they know,
they're watching our forces go on alert.
He said, "We are bringing ours down, we're cancelling all exercises."
And at that moment I thought to myself,
"You know, the Cold War is really over."
Russia now faced a difficult decision.
NATO was going to attack Al-Qaeda in Afghanistan.
But NATO had no military bases close enough.
The former Soviet republics in Central Asia did.
We were going to need Russian help.
It was good for Russia to give a signal to the Central Asians that
American basing out of, say,
Uzbekistan or Kyrgyzstan would not be a problem.
But it was a problem for Sergei Ivanov,
recently promoted to Minister of Defence.
For half a century, Russia had kept America out.
Now the Americans were asking to be invited in.
Putin gathered his national security team.
Putin then offered them the clinching argument.
Thus, Putin opened the door
to a remarkable period of cooperation with the West.
Putin had helped the West -
now he wanted to know what he could get in return.
He travelled to the headquarters of NATO,
the alliance that for 40 years had kept Russia out of Western Europe.
In the grandeur of the Palais d'Egmont,
Putin opened the meeting by saying, "Well, when are you going to invite
"Russia to join NATO?" And I said,
"Well, you know - that's a fairly blunt start to the meeting."
Putin knew that the idea of Russia in NATO
would outrage hardliners in Washington...and Moscow.
And I said, "Well, Mr President..."
I said, "We don't invite people to join NATO.
"You apply for membership."
So he sort of shrugged and said, "Well, Russia is not going to
"stand in a queue with a lot of countries that don't matter."
The limits of the relationship were now clear.
Russia and the West were allies only when it suited them.
So despite Russia's help in the war on terror,
the US went ahead with its missile defence plans.
Colin Powell flew to Moscow to announce that America
was tearing up the Anti-Ballistic Missile Treaty.
Putin looked at me with those steely eyes
of his and he started to complain...
"This is terrible - you are kicking out the legs
"from under the strategic stability,
"and we will criticise you."
And I said, "I fully understand that, Mr President."
And then he, he broke into a smile
and I'll never forget it, he leaned forward to me and he said,
'Ah, good - now we won't have to talk about THIS any more.
"Now, you and Igor get busy on a new strategic framework."
And I said, "Yes, sir."
MUSIC: "Dance Of The Sugar Plum Fairy" from The Nutcracker
In less than six months, President Bush was in the Kremlin.
He had come to sign a treaty
that cut US and Russian offensive nuclear weapons by about a third.
Then, Putin took his American guests
to a command ballet performance - The Nutcracker.
I thought, "It's summertime - why are we seeing The Nutcracker?"
It turns out we share a love of ballet,
but a dislike of classical ballet.
And so he said, "Wouldn't you rather go to see Eifman instead?"
We snuck out and went to the Eifman studios.
We did take Rushailo, the National Security Adviser, with us.
However, I don't think he likes ballet of any kind.
And then before the lights came up, we snuck back in.
I came to...trust that Sergei Ivanov was someone
who was going to deliver on what he set to do
and I think he believed the same about me.
Personal relationships do matter.
You speak very good English!
Hey, there. Nice to meet you.
A few days after the Bushes and the Putins
wandered through the Kremlin,
Russian soldiers in Chechnya carried out a routine raid on a village.
Eight years later,
this young man's remains were dug up at a Russian base.
He'd been shot twice in the head.
Russia's overwhelming force drove
the Chechens to suicide bombings and terror attacks.
In Moscow that autumn,
a musical called Nord Ost was one of the hottest tickets in town.
Then the war in Chechnya came to the theatre.
GUNSHOTS
Some 40 Chechens, men and women,
armed with bombs and suicide belts, took over 800 theatre-goers hostage.
They said they would kill them
if Putin did not withdraw Russian troops from Chechnya.
Chechens had carried out mass hostage-takings before,
and the Kremlin had tried to negotiate.
Putin gathered his closest advisors.
Putin had been scheduled to leave for a summit in Mexico. Instead,
he sent his cautious Prime Minister.
The stand-off in the theatre lasted two days.
Putin then let loose the special forces.
They pumped a narcotic gas into the theatre
that knocked everybody out.
EXPLOSIONS AND GUNFIRE
The doctors on the scene couldn't revive the hostages
because the secret services wouldn't tell them
what gas they had used...
so 129 theatre-goers died.
All the Chechens were shot.
The United States, since 9/11, backed Putin over Chechnya.
President Bush spoke out very clearly
that this had been a terrorist incident.
And President Putin really did appreciate, from 2001 on,
that the United States saw the terrorism
that they were experiencing
and the terrorism that we were experiencing as linked.
This alliance was soon put to the test over Iraq.
The US sought support to take the war on terror to a new battleground.
I thought that in making that case to the Russians,
they might not in fact join in any kind of military effort,
I thought that was well beyond the pale, er,
but that they wouldn't really oppose a military effort either.
A new UN resolution justifying an attack on Iraq was coming up.
Germany and France, firm opponents of the war on the Security Council,
also decided to seek Russian support.
Putin visited both countries.
Putin said he was happy to make common cause with the Chancellor,
but he worried
that France's President Chirac would not stand firm.
Schroeder phoned Paris.
When Putin had visited Paris before,
Chirac had sent an official to meet him at the airport.
But now the French President turned on all his charm.
BRASS BAND PLAYS
Putin wanted Chirac's word that he would vote against the war
unless there was hard evidence
that Iraq had weapons of mass destruction.
The two presidents walked out
and buried America's chances of getting UN approval.
And at that point, we knew our efforts were...had failed.
We didn't much like the spectacle of America's closest allies, er,
standing with the Russians on a security interest
of interest to the United States.
The war Putin opposed was soon helping to make Russia rich.
The price of oil steadily increased.
Russians who'd grown up in Soviet poverty learned to love their bling.
Putin decided to seize a share for the state
via a huge tax on oil exports.
This started a battle between Putin and Russia's richest man,
oil tycoon Mikhail Khodorkovsky.
It became a war over democracy.
The night before the vote on the bill to raise oil tax,
an executive from Yukos Oil called on the Minister in charge.
The next morning in parliament, the government withdrew its tax bill.
But tax wasn't the only way for Putin to get at the oil wealth.
A small oil company owned by the state, Rosneft,
began to buy up oil fields.
It outbid the private companies so massively that it led to
the allegation that its officials were stealing money from the state.
Khodorkovsky complained to Putin
about what he thought Rosneft was up to.
Khodorkovsky prepared a presentation on how corruption was spreading -
even into the Kremlin.
What followed started a political conflict
that divides Russia to this day.
Khodorkovsky's presentation was to be televised.
He cleared what he would say
with both the Kremlin chief of staff and the Prime Minister.
It was a tough presentation,
but nothing that Putin himself hadn't said.
Then Khodorkovsky went after one of Putin's closest Kremlin aides.
Rosneft had done this deal with the blessing of an old friend of Putin's
at the KGB, now his deputy chief of staff.
A few weeks later, Khodorkovsky's oldest friend
got some disturbing news from a contact
in Russia's intelligence service.
Putin issued a thinly-veiled threat to Khodorkovsky
not to challenge him politically.
Khodorkovsky knew he was vulnerable.
He had built his company in the 1990s, when Russian business law
was in its infancy.
Five months after the public confrontation with Putin,
one of Khodorkovsky's inner-circle was arrested
for a deal they did back in the 1990s.
Nevzlin left Russia. Khodorkovsky stayed and fought.
With parliamentary elections approaching,
he bought a publishing house, poured money into the opposition parties,
and spent most of his time promoting democracy
through his foundation, Open Russia.
But within a month, eight more of Khodorkovsky's people were arrested.
To protect the company, he decided to merge it
with the American oil giant Exxon Mobil.
The head of Exxon Mobil came to Moscow.
He told Putin about his plans.
Within hours, the police raided Yukos,
seizing tax records going back a decade.
Khodorkovsky's friends advised him to flee.
Instead, he set off on a trip around Russia, campaigning for democracy.
While Khodorkovsky was on the road,
his deputy was called by a contact in the prosecutor's office.
A few hours later, Khodorkovsky was arrested.
Yukos was broken up. Its assets were seized
and transferred to the state oil company.
Khodorkovsky remains in prison, a symbol, to many Russians
and to the West, of Putin's indifference to the rule of law.
Now Putin was the unchallenged master of a stronger
and less democratic Russia.