Anatoly Chubais
Anatoly Borisovich Chubais is a Russian-Israeli politician and economist who was responsible for privatization in Russia as an influential member of Boris Yeltsin's administration in the early 1990s. During this period, he was a key figure in introducing a market economy and the principles of private ownership to Russia after the fall of the Soviet Union. He has the federal state civilian service rank of 1st class Active State Councillor of the Russian Federation. He fled to Israel in 2022 and subsequently obtained Israeli citizenship.
From 1998 to 2008, he headed the state-owned electrical power monopoly RAO UES. A 2004 survey conducted by PricewaterhouseCoopers and the Financial Times named Chubais the world's 54th most respected business leader. He was the head of the Russian Nanotechnology Corporation from 2008 to 2020.
In December 2020, he was appointed a special envoy of the Russian president for relations with international organizations to achieve the Sustainable Development Goals. He resigned from this position in March 2022 and left Russia after opposing the Russian invasion of Ukraine, according to media reports. He is the highest ranked Russian figure to have resigned due to the invasion.
Chubais was a member of the Advisory Council for JPMorgan Chase from September 2008 until 2013. He is a long-time participant and speaker of the Bilderberg Club. On 30 May 2024, he took part in the club's 70th anniversary meeting in Madrid, Spain. That same year, he founded the Center for Russian Studies at the Faculty of Social Sciences at Tel Aviv University. He is currently an acting member of The Global Board of Advisors of the Council on Foreign Relations.
Early life
Chubais was born on 16 June 1955 in the town of Borisov, Belarus, which was then part of the Soviet Union, the son of Raisa Efimovna and Boris Matveyevich Chubais. Though his mother received a degree in economics at university, she opted to stay home to care for their children on the military bases where her husband was regularly assigned. Anatoly Chubais has an older brother, Igor Chubais, a philosopher. Chubais is Jewish.In 1977, Chubais graduated from the Leningrad Institute of Engineering and Economics in present-day St. Petersburg and joined the Communist Party of the Soviet Union until 1991 when he left it.
Career
Early career (1977–1991)
While later working at LEEI, Chubais started a club called Reforma, which helped turn the city of Leningrad into a model of political reform by constructing platforms for both local and national elections. Reforma also engaged in drafting reformist legislation, an important step down the road when Chubais would work in the city government. In 1982, he attained the rank of associate professor at LEEI, while in 1983, he received his Candidate of Sciences degree in Economics for the dissertation entitled "Исследование и разработка методов планирования совершенствования управления в отраслевых научно-технических организациях".Starting in the early 1980s, Chubais became a leader of an informal circle of market-oriented economists in Leningrad. In 1982, together with economists Yury Yarmagayev and Grigory Glazkov, he published an article titled "Вопросы расширения хозяйственной самостоятельности предприятий в условиях научно-технического прогресса" in which the authors argue that no amount of central planning can predict the end-demand for products. In 1982, Chubais was introduced to the future Prime Minister of Russia Yegor Gaidar, who was invited to and attended seminars led by Chubais.
By 1987, Chubais had become the organiser of the Leningrad chapter of the club Perestroyka, whose mission was to promote and discuss democratic ideas among the local intelligentsia. Among the people involved were his brother, Igor, who had founded the Moscow-based chapter of the Perestroyka and Perestroyka-88 clubs, future Russian Deputy Prime Minister Alexei Kudrin, future Chubais associates Pyotr Mostovoy and Alexander Kazakov, the future President of Saint Petersburg bank Vladimir Kogan, future Minister of Anti-Monopoly Policy and Entrepreneurship Support Ilya Yuzhanov, and future Deputy Governor of Saint Petersburg Mikhail Manevich.
The dissident economists organized a tulip farm to finance their seminars. In the four days before the International Women's Day, they managed to get income equivalent to the price of several Lada cars. The tulip money was used to finance the elections of Anatoly Sobchak, Yury Boldyrev and many other democratic candidates. As a result, 2/3 of the deputies winning the 1990 elections to Leningrad Soviet were from the opposition. Chubais himself later stated that he personally did not participate in growing or selling of the flowers.
At the end of 1990, the economist Vitaly Nayshul proposed the idea of using vouchers to facilitate mass privatization in order to transform the Soviet Union into a market economy. Chubais strongly criticized the scheme at the time, citing the inevitable inequality and social tensions that would result if implemented as proposed. Ironically, Chubais would later become the champion of the same concept just several years later.
Privatization chief in Leningrad (1990–1994)
In 1990, upon the election of Anatoly Sobchak as Chairman of the Leningrad City Council, Chubais assumed the position of his Deputy. He was trying to implement Sobchak's idea of creating a Free Economic Zone in Leningrad. In 1991, Chubais declined the offer to become the Chairman of the Leningrad Executive Committee to instead become an advisor to the mayoral administration in Leningrad where Sobchak had just been elected mayor. At the same time, Chubais worked as the president of newly established Wassily Leontief Center for Research in Economics.In the Yeltsin government (1992–1999)
Chubais originally advocated rapid privatization in order to raise revenue, similar to the model used in Hungary. However, the Congress of People's Deputies of Russia rejected this model. Eventually, Chubais developed a compromise in the form of a proposed voucher privatization program akin to the program used in the Czech Republic at the time. On 11 June 1991, the Supreme Soviet of Russia adopted this compromise and the massive program was officially initiated by decree of President Boris Yeltsin on 19 August 1991. In November 1991, Chubais became a member of the Yeltsin cabinet where he managed the portfolio of the Committee for the Management of State Property which was handling privatization in Russia. He was recommended to Yeltsin by Yegor Gaidar. The GKI was understaffed, so Chubais filled it with many of his associates, mostly from his time in Saint Petersburg, including Alexander Kazakov, Alfred Kokh, Dmitry Vasilyev, Maxim Boycko, and Andrei Illarionov. In June 1992 he was appointed as a deputy prime minister by Yeltsin, and was responsible for economic matters. He was also later made the first head of the Federal Commission of Securities, before being replaced in that role by Vasilyev.The implementation of the program experienced many problems. The vouchers were not guaranteed by the government, and enterprises did not have to accept them. Some of the most profitable enterprises were not included in the voucher scheme. The vouchers were anonymized and could be bought or sold. Each voucher was worth ten thousand rubles, but the hyperinflation that Russia experienced in 1992 and 1993 greatly reduced the value. Many people ended up selling their voucher, and even those that did use them to buy shares never received ownership or income. The joint stock companies did not pay dividends. At the same time, some businessmen started funds to buy up vouchers, and used them to take control of large enterprises at a small fraction of their worth. Enterprises and properties that had provided basic services were also sold off in auctions, and after that their new owners catered to the emerging small wealthy class, increasing prices and making them unaffordable for the great majority of Russians. All of this occurred in a relatively short time frame.
This privatization program came under heavy criticism. The word voucher became synonymous with swindle, and Chubais, according to The New York Times, became "the most despised man in Russia." Chubais later admitted in his book History of Russian Privatization that the voucher program did not create a large class of property owners, and that it decreased production. Chubais and his associates worked with the Harvard Institute for International Development, which was in charge of U.S. foreign aid to Russia during the Clinton administration. It operated with minimal USAID oversight, and Chubais' group, and some of the foreign advisors from HIID, allegedly profited using his position in the Yeltsin administration. HIID members were involved in drafting presidential decrees related to privatization, which were promulgated by Yeltsin under the influence of Chubais. With the help of HIID, "private" organizations founded by Chubais and his associates in Russia received significant amounts of foreign aid, which they enriched themselves with.
Yeltsin reshuffled the cabinet in early 1994 as Russia experienced economic difficulties, which left Chubais as the only original reformer still in the cabinet. A new wave of privatization took place in 1994, overseen by Chubais and the GKI, which auctioned off some of the largest industrial enterprises in the world. Chubais was removed as chairman of the GKI in November 1994. From November 1994 until January 1996, Chubais held the position of First Deputy Prime Minister of Russia for economic and financial policy in the Russian government. Thanks to liberalizing reforms carried out in 1995, the Russian government was finally enjoying a measure of financial stability, something its politicians had been seeking ever since the resignation of Yegor Gaidar in 1993. By the end of 1995, the average annual inflation-rate had declined from 18% to 3%. From April 1995 until February 1996, Chubais also represented Russia in two international financial institutions – the International Bank for Reconstruction and Development and the Multilateral Investment Guarantee Agency.
After resigning as deputy prime minister in January 1996, Chubais agreed to manage Boris Yeltsin's reelection campaign. By this time, according to public opinion surveys, Yeltsin's approval rating had fallen to roughly 3%. Chubais established the Civil Society Foundation as well as Yeltsin's Campaign Analytical Group, which became one part of the Foundation. The group helped Yeltsin regain popularity and win re-election in the second round of the polls on 3 July 1996, capturing 53.82% of the popular vote. From July 1996 until March 1997, Chubais served as the chief of the Presidential Administration of Russia. During his tenure, his office grew increasingly influential. When Yeltsin underwent an operation in the fall of 1996, his prime minister Viktor Chernomyrdin was vested with some of his powers, but Chubais received even more economic and political authority. Yeltsin was criticized by the State Duma for giving Chubais too much power. In March 1997, Chubais returned to the cabinet as First Deputy Prime Minister of Russia. That summer he became involved in scandal regarding his book on privatization.
Chubais participated in the Bilderberg Club session at Turnberry, Scotland in 1998, and co-chaired the Round Table of Industrialists of Russia and the EU during the joint session of the Government Commission of the Russian Federation and the European Union. He was also elected to the Board of Russian Union of Industrialists and Entrepreneurs in 2000.
According to Yeltsin's daughter and chief-of-staff Tatyana Yumasheva, Chubais opposed the nomination of Vladimir Putin as Prime Minister of Russia and Yeltsin's successor in 1999. Although Chubais believed Putin was qualified for the position, he feared that his appointment would be rejected by the State Duma, allow the Communist Party of the Russian Federation to gain a large enough parliamentary majority to amend the constitution, and start a civil war.