The Spy Who Came In From The Crowd

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Lieut. Colonel Putin came home to a Russia that was radically altered. While he had been tasting the ways of the West, his country had roiled through the reversals of perestroika. Moscow Center's talent spotters took no interest in him, and he was given a low-rent KGB "cover" job assisting the rector at his old Leningrad university, a position normally reserved for a retiring agent. He was unsure how he fit into the new order, says a close aide. Worse, says Polokhov, who met him again in 1990, Putin was "hurt that the state did not want him anymore." Polokhov says Putin told him then that he was "fired without a pension" from the agency he had so lovingly served for 15 years. When Polokhov expressed his own indignation, he recalls, Putin said, "That's all right, Leonid, because sometime later I will show them who Putin is."

Yuri Kobaladze, a onetime KGB general turned businessman, says Putin's life changed when he bumped into former Leningrad law lecturer Anatoli Sobchak in a corridor early in 1990. Sobchak asked what he was doing. "I'm doing nothing," Putin replied. "My career's not a success because they told me to come back here. I have nothing to do here." "Join me," said Sobchak. Sobchak was dazzling the city with his promises of democracy and reform. Putin was ready to make a "real break," says a close Putin aide. "People had the feeling Sobchak was someone they could peg their destiny to." Some say Putin was planted on Sobchak by the KGB; this aide says Putin informed his KGB bosses of the job offer, and they gave their approval because the service was disintegrating too.

In the turbulent years of radical capitalism, Putin by Sobchak's side metamorphosed into an efficient back-room operator and master of office politics. Putin plunged into his new market-economy milieu with the same zeal he had brought to spying. At first he couldn't make it all out, says a colleague who worked in the same government, "but he worked hard and learned fast." Sobchak loved the limelight and spreading the reform gospel, but he was a managerial incompetent. Efficient, loyal Putin stepped into the vacuum. Soon he was the city's "gray cardinal," quietly working the pulleys and levers of power. "He understood the mechanisms of decision making, both hidden and overt," says Alexei Kudrin, who worked with him then and is now First Deputy Finance Minister in his Cabinet. "A thorough professional," says Vladimir Yakovlev, who worked beside Putin for Sobchak before defeating him in the 1996 mayoral race. "If he said it would be done, it was done." In effect, Putin was the day-to-day manager when corruption enveloped the city, rules were bent, shortcuts taken. But while Sobchak had to flee abroad to escape corruption charges, nothing was ever proved against Putin, despite one very public accusation of abuse of power leveled by a city parliamentary inquiry. For all Putin's diligent management, St. Petersburg's economic renaissance never quite materialized, and Sobchak lost a re-election bid in 1996.

Out of work once again, Putin got his next boost from St. Petersburg colleagues gathering in Moscow around Anatoli Chubais. The brilliant but reviled architect of Russia's radical--and radically corrupt--privatization program was ensconced at the Kremlin, where he helped put a Western face on Boris Yeltsin's increasingly erratic regime. Chubais likes to take the credit for elevating the obscure Putin, once bragging aloud at a party that he had "privatized" the former KGB agent too. Chubais did not know Putin personally, says Kudrin, another of Sobchak's bright young men brought to Moscow, until others in Sobchak's circle told him of Putin's reputation for effective administration and loyalty--and his need for "an honorable position." Just the man, it turned out, to suit Pavel Borodin, who needed sharp legal talent in his office managing all the Kremlin's sprawling property. Borodin was later accused of being an active player in the web of corruption that has allegedly enriched the Yeltsin Family, that circle of relatives and business cronies who are said to have profited so handsomely from their closeness to power.

Whatever Putin did there, it impressed Yeltsin. "He showed himself a person willing to play by the old rules in the name of new politics," says Russian analyst Simes. If he had ambition, he never showed it in a way that might be seen as threatening. A military colonel who met him on business then saw him as "a little clerk out of a box to serve his master."

In short order the clerk was put in charge of the department overseeing implementation of presidential decrees, where he proved a stern enforcer. "He can be harsh when necessary," says Lilia Shevtsova, senior associate at the Carnegie Moscow Center. "But he can also stretch out his hand and say, 'Let's do this the civilized way.'" He proved no man to trifle with.