Will Vladimir Putin Take on The Mob?

An oil executive is gunned down with a rocket-propelled grenade in rush-hour traffic. A city-council member is indicted for running a murder-for-hire ring. Another gets his head blown off by a car bomb. Thugs beat an anti-corruption crusader with rubber truncheons. And organized crime is so pervasive that it gets its hooks into people even after they're dead: the local cemetery business is reputedly controlled by a ruthless gang led by a local "businessman" called "Kostya the Grave."

St. Petersburg, the elegant city of Pushkin and the Winter Palace, is today the capital of Kalashnikov Capitalism, a place where the "rule of law" gets trumped by an older principle: might makes right. It's also the birthplace of the just-inaugurated president of Russia, Vladimir V. Putin. Elected in part because of his promise to impose "a dictatorship of the rule of law," Putin could find no better place to start than the town where he first made his political reputation as deputy mayor. In Russia's most esthetically graceful city, the lines between commerce, politics and organized crime are about as thin as the cross hairs on a sniper's rifle. Since 1997 alone, according to law-enforcement statistics, there have been more than 200 contract murders carried out in St. Petersburg. Most of them remain unsolved.

Putin's initial moves against this culture of violence have not been promising. When he succeeded Boris Yeltsin at the end of last year, Putin seemed intent on ousting St. Petersburg's powerful governor, Vladimir Yakovlev. Yakovlev's critics--including a former local chief of police--claim he has ties to an organized-crime gang that is now the real power in town, having gained control of profitable local businesses like oil distribution on Yakovlev's watch. The governor has repeatedly denied the charge.

A couple of months ago Putin was talking tough about Yakovlev. At the February funeral for his old boss, the liberal St. Petersburg governor Anatoly Sobchak, a tearful Putin suggested that Sobchak died "as a result of persecution" from his political enemies. It was a clear reference to Yakovlev. Rumors flew that Putin would put the Kremlin's muscle behind popular former prime minister Sergei Stepashin to challenge Yakovlev in the governor's election next Sunday. Instead, for reasons that are not clear, Putin unexpectedly endorsed a political lightweight, a woman named Valentina Matviyenko.

Then, last month, Putin apparently decided that there would be no political war with Yakovlev at all. He forced Matviyenko to withdraw and clandestinely met with Yakovlev. Political sources in St. Petersburg assume Yakovlev offered a straightforward deal: loyalty to the Kremlin in exchange for a free ride when Yakovlev stands for re-election.

This week Putin will finally start to appoint his own people to positions of power. Many of them--his security-service chief, for one--will be from St. Petersburg. These are people who consider themselves graduates of the "good" St. Petersburg, the birthplace of the democracy movement in the late '80s that eventually brought down the Soviet Union. All, Putin included, worked for Sobchak.

In truth, Sobchak himself was no saint--he left the country in 1997 amid corruption charges, which he denied. But Yakovlev doesn't do a lot to counter the impression that forces loyal to him can play rough. One city-council member complained of corruption in Yakovlev's health-care bureaucracy. Assailants wielding rubber truncheons broke his nose, ribs and skull, but took no money or valuables. In October last year, Viktor Novosyolov, a powerful city-council member and onetime Yakovlev ally, was killed when a bomb placed on his car roof decapitated him. The victim was reputed to have organized-crime ties, but had broken with Yakovlev. According to several city-council members, Novosyolov had compromising material on Yakovlev that he was ready to make public.

It's far from clear what game Vladimir Putin is playing in St. Petersburg. Some suggest that, in return for withdrawing his opposition to Yakovlev's election, Putin asked him for help in getting the local "businessmen" to lay down their arms. Perhaps. But the only way to tell will be if the number of customers for Kostya the Grave finally begins to go down.

Thanks to Brain Whitmore