OИCE UPOИ A TIME IИ ЯUSSIA

OИCE UPOИ A TIME IИ ЯUSSIA

THE RISE OF THE OLIGARCHS

A True Story of Ambition, Wealth, Betrayal, and Murder

By Ben Mezrich

Review by Brian J. Stinar

2016.04.10

COMP 330

UNM Russian Degree

Ben Mezrich tells the intertwined story of Boris Berezovsky and his protege Roman Abramovich, two Russian oligarchs that rose to power during the fall of the Soviet Union in the лихие девяностые (dashing nineties.) Berezovsky rose from an obscure post as a mathematician, due to his understanding of interest rates, financial markets, other economic tools, and software, in a time when such knowledge was extremely valuable, and extremely rare. Abramovich used his skills as an entrepreneur to transition from a seller of children’s toys to oil and aluminum.

Boris Berezovsky began his meteoric rise to power using his mathematically skills to create software accounting systems for AvtoVAZ, a privatized car company. While there, he realized that the government-appointed “Red Directors” knew nothing about capitalism, and the new economic system they functioned under. His software company grew into the world’s largest Lada (model of car AvtoVAZ made) dealership. During this time, he was able to take the massive inflation of the time, and turn it to his advantage. He ordered a large number of cars for his dealerships, from the manufactures, paid a small down payment to the Red Directors (which, Mezrich says they pocketed) and then paid the rest off after a long period of time. Everything had insane-o inflation. Having fixed interest rates for money owed to the manufacturers, while inflating the prices of the cars sold to consumers, allowed him to purchase his supplies for almost nothing. None of this is illegal - it is arbitrage played on differences in interest rates. Even though none of this was illegal, someone still blew up his car (with him in it, which sent him to the hospital for a long time.) He didn’t give up.

Berezovsky became involved with the media. He purchased a controlling share of Channel One Russia (OTR Television) with Yeltsin’s permission. Berezovsky placed an extremely popular anchorman and producer, Vladislav Listyev, as CEO of Channel One. At the time, advertising was a fiercely competitive industry in Russia. Listyev wanted to bring all advertising sales into direct Channel One control, and out of the hands of unauthorized middlemen such as a consortium of (corrupt) shareholders for actually selling advertisements. Within months, Listyev was gunned down on his stairway. Huge amounts of cash were left on him, which made everyone think that his murder was a political, or business, assassination. To me, this seemed sort of like an aside in the story. However, after discussing this with a number of my Russian friends, every single one of them either knew about this, or remembered exactly what they were doing when they heard the news about his death. Listyev was immensely popular as an anchorman, and his stance against corruption in Channel One made him into a martyr. I believe the author put this in the book because of its extreme cultural significance, and to illustrate Berezovsky’s role.

Berezovsky used his position in the media to promote the government, and to continue to be on good terms with Yeltsin. He was extremely influential with the president’s daughter and part of their inner circle, called the “Family.”

Boris Berezovsky and Roman Abramovich met on a yacht party, and became friends. Berezovsky was older than Abramovich, and saw an opportunity to help the younger man, grow together, and have a protege. Berezovsky became Abramovich’s ‘roof’ or krisha (крыша.) This is a concept sort of like a feudal lord - a protector, teacher, and someone that you pay money to regularly for their services. Probably the best example of this relationship comes from this paragraph:

Abramovich nodded, because he understood. Berezovsky didn’t need to spell out what these expenses might be; he wasn’t signing an employment contract, or even a partnership deal. Abramovich had come to him because of who he was - and what he brought to the table. His politicial connections, his protection, his roof. No doubt, Abramovich had done his research. He knew all about OTR, the Logovac Club, and Berezovsky’s lifestyle. He knew exactly what sort of deal they were about to strike.

They rose to immensely powerful and high positions together. They controlled oil, aluminum and media. Together they engineered Yeltin’s continued election, and the way he stepped down, guaranteeing Vladimir Putin a place. Berezovsky was a kingmaker. Everything was going well…

… Until Berezovsky publicly criticized Putin. Finally, the criticism culminated with how Putin handled the sinking of the Kursk, a submarine. Putin continued to place pressure on OTR, and Berezovsky, until he had to sell all of his controlling shares in major Russian industries. Abramovich realized his roof was falling, and offered a BILLION dollars to Berezovsky to end their relationship, since his roof was falling down. Berezovsky accepted.

Later, Berezovsky sued Abramovich in a court in the United Kingdom. The ruling was entirely in favor of Abramovich, and Berezovsky was labelled an unreliable witness, and delusional about his sense of self importance. He later killed himself, still fabulously wealthy.

This work reflects the realities of the dashing nineties. The author provides an entertaining story about the time, focusing on Boris Berezovsky and the people around him. The essential message it conveys is that you do not mess with the government in Russia. If you helped make two presidents, are one of the most powerful men in the world, you still do not use your power to criticize those in control of the government.

My opinion of this work is that it was a very fun story to read. Whenever I would ask Russian people about their opinions of the events the author portrayed, they were exactly in line with what the author discussed. I actually cared about the characters, and felt like they were real people. The author said he heard this story firsthand, from someone involved in the entire thing. I believe him. 

I highly recommend you purchase this book. It is available here.