Yeltsin Ousts Last Reformist From Cabinet

MOSCOW —  Removing the last of his aggressively pro-reform advisors, President Boris N. Yeltsin on Tuesday dismissed First Deputy Prime Minister Anatoly B. Chubais, who has spent the past four years easing Russia’s creaky economy toward the free market.

With Chubais gone, Yeltsin has cleared room to build a new administration--one more palatable to the Communists and nationalists who won big in last month’s parliamentary election.

Having been battered in the polls and bashed on the campaign trail, the president has ousted his liberal advisors one by one, replacing them with hawkish hard-liners or cautious conservatives.

Yeltsin has never publicly said that he wants to junk his reforms. But his staff shake-ups signal that Russia’s mad dash from communism to capitalism is, at the very least, slowing.

“This is a clear change of course,” liberal lawmaker Pavel G. Burich said glumly. “I don’t see a single decent figure left. There are no more market-oriented people in the government.”

Chubais, 40, devised the privatization plan that converted major state-held assets into private companies. He led the drive for Western investment in Russia. And he pushed the reforms needed to secure loans from the International Monetary Fund. The day of his ouster, an IMF team was headed to Moscow for talks on a major loan, reportedly $9 billion over three years.

Despite his reputation abroad, Chubais said Tuesday that he realizes “the president’s evaluation of my work is rather negative.”

Indeed, the same policies that won Chubais praise from Western economists drew scathing reviews at home.

The privatization vouchers he proudly distributed to each Russian citizen, claiming they would be worth as much as three Volga sedans, proved to be practically worthless--traded on the street for a bottle of vodka.

Equally devastating, inflation soared during Chubais’ first two years in charge of economic policy, until a lifetime’s savings could buy little more than two loaves of bread. While elite businessmen tooled around town in BMWs with cellular phones, elderly babushkas were reduced to peddling extra socks on snowy corners. Teachers, scientists, factory workers and countless others struggled through months without pay as their employers simply ran out of rubles.

Chubais acknowledged that his austerity programs were hurting ordinary people, but he insisted that the reforms would pay off.

“Privatization in Russia was unavoidable,” he said Tuesday, defending his policies even after his ouster. “During any transition . . . there will be mass criticism and dissatisfaction.”

That dissatisfaction translated into millions of votes for Communists and nationalists in the Dec. 17 parliamentary election.

Yeltsin has moved to appease those hard-line foes in recent weeks by giving powerful Cabinet posts to bureaucrats they approve of. Since the election, he has replaced his foreign minister, his chief of staff and his ministers of agriculture, transportation and nationalities.

Sensing the trend, Chubais offered his resignation Tuesday evening. The Itar-Tass news agency reported that Yeltsin at first refused the resignation, then relieved Chubais of his duties anyway.

“I hope that we have the replacement of a person here, not the replacement of a policy,” Chubais said. “The greatest mistake would be to change our policy five minutes before the presidential election” scheduled for June.

Chubais said he had discussed economic policy with Prime Minister Viktor S. Chernomyrdin on Tuesday. The prime minister agreed that the reformist economic team “should continue its work,” Chubais said.

But lawmakers gathered at the parliament building Tuesday predicted that Yeltsin’s Cabinet make-over will prove more than cosmetic.

“We need to change our course,” Communist leader Gennady A. Zyuganov said. “If a new team comes in, you always get a change of course.”

Former Soviet Prime Minister Nikolai I. Ryzhkov, now an ultranationalist deputy, also urged a swift about-face. “Millions of people cannot make ends meet,” he said. “We need to change our approach to the economy, change the way things are done around here.”

As Zyuganov and Ryzhkov well know, Yeltsin will need to win over at least some of their supporters if he hopes to capture a second term.

Although he is not expected to announce his decision officially until mid-February, Yeltsin has been dropping plenty of not-so-subtle hints that he plans to run for reelection.

Most recently, he appointed two top advisors to head a new committee called the All Russia Headquarters of Presidential Elections.

“For now,” he said, the committee will supervise presidential politicking “in general.” But analysts predict that it will swiftly become a reelection campaign team.

News of Chubais’ dismissal zipped through the clusters of parliamentary deputies who gathered to gossip outside their chamber during the first session of the new Duma, the lower house of parliament. They also had their own political intrigues to chew over--most notably, the controversy that erupted when they tried to elect a new chairman.

About 450 deputies jostled their way to deposit yellow ballot slips in wooden boxes. The final tally came in just after dinner: Reform-minded candidates had split the liberal vote, letting their Communist foe emerge on top.

That same scenario could play out in June’s presidential race if liberals fail to unite behind a candidate.

In the chairman’s race, Communist Gennady N. Seleznev took top billing but failed to get the necessary 226 votes--forcing a runoff and sparking a ruckus.

About one-third of the deputies had left the building before the runoff, unaware that they would be called upon to vote again. The remaining lawmakers began bickering about whether it was proper to hold a second round of balloting without their colleagues.

“What kind of democracy is this?” raged ultranationalist leader Vladimir V. Zhirinovsky.

Zhirinovsky and his faction ultimately stormed out of the Duma. Yeltsin’s party boycotted the vote in protest. And Seleznev ended up with just 219 votes, again falling short.

Parliament adjourned for the night without a chairman--but with plenty of furious deputies ready to return today to continue the fight.