President Vladimir Putin dropped the hammer Tuesday on Russia's first civilian defense minister, military reformer Anatoly Serdyukov, amid a burgeoning corruption scandal that appears to have implicated the minister and some of his top aides in a $100 million embezzlement scheme.
Mr. Putin said he was sacking Mr. Serdyukov in order to "ensure the objectivity of the investigation" into the spreading scandal around Oboronservis, a Defense Ministry-owned company that was accused last month by the State Duma's Accounting Chamber of selling prized real estate plots around Moscow at a loss – with huge kickbacks allegedly being funneled to top ministry officials. His removal means that Serdyukov can now be questioned in connection with the case.
In a somewhat unusual announcement, which suggests political considerations may lie just below the surface, a Kremlin statement made clear that Serdyukov was removed on Putin's orders, but his successor, Sergei Shoigu, was chosen "on the recommendation of the prime minister," former President Dmitry Medvedev.
Mr. Shoigu, a four-star Army general who's the current governor of the Moscow region and was long-time head of the Ministry of Emergency Situations (the Russian equivalent of FEMA), has an unshakeable reputation for competence and loyalty, and is one of the few long-time Russian officials who appears to enjoy genuine, from-the-heart public respect.
Reaction to Serdyukov's firing was mixed, with some military-connected experts blaming the civilian minister for alienating the officer corps, gutting the armed forces, and fanning the flames of corruption in the course of carrying out the most sweeping campaign of structural reforms to Russia's military in almost a century.
"Military people didn't like Serdyukov, because he seemed to have no connection with the Army," says Alexander Khramchikhin, an expert with the independent Institute of Political and Military Analysis in Moscow. "His Army reforms had a destructive character, and the results are ambiguous at best."
Serdyukov was given extraordinary political backing by Putin to enact reform after the brief 2008 war with Georgia revealed vast inefficiencies in Russia's military capabilities.
His thankless task was to effectively abolish the old Soviet "mobilization army," which kept hundreds of "phantom divisions" – with almost no personnel but a full complement of top officers – on the books, to be filled out with reservists in time of war. In the course of the reforms, thousands of officers were forced to retire, the privileges of generals were slashed, while pay and benefits for those who remained in the streamlined Russian army were substantially improved.
Conservatives argue that the once great Soviet military machine, which won World War II, has been destroyed.
"Military science has been ruined, our military intelligence has all but disappeared," says Anatoly Tsiganok, an expert with the Moscow-based Strategic Culture Foundation, which generally expresses a deeply conservative and nationalist point of view.
"During Serdyukov's tenure, nepotism became standard practice at the defense ministry. Corruption grew; for example, the cost of replacing the engine in one Sukhoi fighter jet almost quadrupled.... No new weapons were created for the army. Oboronservis was a completely non-transparent outfit. As for Serdyukov, he was Putin's man, married to the daughter of Viktor Zubkov," Putin's former prime minister and now top official of the state natural gas monopoly Gazprom, he adds.
Was it revenge?
Alexander Golts, a former military officer, outspoken liberal, and columnist with the online newspaper Yezhednevny Zhurnal, says he smells revenge by conservative forces behind Serdyukov's firing.
"When the corruption scandal first broke, Putin demonstratively met publicly with Serdyukov. That suggested support, because Putin never receives officials who are about to be dismissed," Mr. Golts says.
"It seems that bureaucratic clans began working, without Putin's permission, just informing him.... Now he's fired the minister who carried through the most painful phase of military reform, the only real reform that's taken place in Russia in the past decade," he says.
"And Serdyukov, who had offered to resign before but wasn't allowed to by Putin, now has to leave without honor. Now he's not a successful reformer, but an embattled man at the center of a corruption scandal."
The scandal around Oboronservis has shed rare public light on the kind of corruption that experts say pervades Russian government agencies. The company, on whose board of directors Serdyukov served until last year, has monopoly contracts to service Russian military buildings and bases, repair military equipment, and is often used as a go-between in real estate dealings involving the Russian armed forces.
Vladimir Markin, spokesman for the Kremlin's powerful Investigative Committee, told journalists last week that Oboronservis had been selling off prime Moscow real estate belonging to the military at prices far below market rates. He cited several well-known buildings in Moscow, including the famous Soyuz Hotel, which were allegedly sold for as much as 30 percent below market value.
The Investigative Committee has opened five criminal cases, including one against long-time close Serdyukov aide Yevgenia Vasilyeva, alleging that the difference – about $100 million, it says – was embezzled and distributed among top defense ministry officials.
"Yes, the army is bogged down in corruption, the stealing of state money, just as our whole society is," says Valentin Rudenko, director of the independent Interfax/AVN military news agency.