2 More Yeltsin Aides Fired in Bribery Scandal

A bribery scandal reached the highest offices of the Kremlin on Saturday as President Boris N. Yeltsin fired two key reform ministers--but stood by the chief architect of Russia’s economic transition, who has also been tarnished.

Yeltsin rejected the offered resignation of First Deputy Prime Minister Anatoly B. Chubais, the presidential press service reported, because of the “extremely critical social and economic situation in Russia.”

The sackings of privatization chief Maxim V. Boiko and Federal Bankruptcy Commission chief Pyotr P. Mostovoi left Chubais as the only survivor of a political disaster triggered by five senior officials’ acceptance of $450,000 in what were ostensibly book advances but have been called a thinly veiled scheme to buy official favor.

Yeltsin fired his deputy chief of staff, Alexander I. Kazakov, on Friday. The fifth would-be author, former privatization chief Alfred Kokh, had quit over a similarly dubious book deal three months ago.

The controversy has inflicted tremendous damage to the government’s image, especially because it has evolved amid a much-touted anti-corruption campaign by Yeltsin, Chubais and other top leaders.

“The latest situation is seriously hindering the work of the government,” Prime Minister Viktor S. Chernomyrdin told reporters, denouncing the book scandal as “dirty.”

*

Chubais and the four others have admitted accepting $90,000 each to contribute to a book on the history of privatization in Russia. The publishing house is part of the financial empire of banker Vladimir O. Potanin, who won several controversial tenders for valuable state assets this year.

Champions of market reforms fear that with the high-level officials’ admission of impropriety in the already scandal-ridden process of selling off state property, the reformers could lose the moral high ground to Communists and nationalists who have been fighting privatization.

Chubais, who is Yeltsin’s right-hand man and wields powers far beyond those implied with his titles of finance minister and first deputy to Chernomyrdin, is credited as the major force in putting at least 75% of Russia’s businesses and property into private hands over the past six years.

The transition from state monopolies to free enterprise in virtually every service and industry has been harshly criticized by Yeltsin’s political opponents, who contend that the transformation has enriched only a handful of powerful bankers while depriving ordinary Russians of any benefit in the sale of national assets that were equally theirs.

The 42-year-old Chubais conceded Friday that the book advances were unseemly and the public reproaches justified--an uncharacteristic admission of wrongdoing likely to encourage the Communist-led opposition to drag out damaging battles over unfinished reforms.

The opposition-controlled Duma, the lower house of parliament, had already been resisting approval of a 1998 budget and recently succeeded in spurning the government’s draft of urgently needed tax reform legislation.

State-financed Russian Television had speculated late Friday that Yeltsin might sacrifice Chubais, an aloof intellectual who is hated by many in the rowdy Duma, in exchange for the deputies’ backing on the budget and tax bills.

But a Kremlin source who explained Yeltsin’s decision to the Interfax news agency noted that the loss of the mastermind behind Russia’s economic transformation “would destabilize the executive branch of the government and could do serious damage to the country’s economy.”

Boiko, who has served beside Chubais throughout the tumultuous transition, said he accepted his dismissal “calmly” and hopes that the important work of privatization will continue.