Revving up for a run at the Kremlin

Mikhail Kasyanov can see all the way to the Kremlin from his 19th-story Moscow office – albeit with a high-powered telescope. Through its lens, the ex-prime minister observes the comings and goings at his former – and, he hopes, future – workplace.

It's just five miles away, but the obstacles in between may prove insurmountable. As the Kremlin gears up for what is sure to be a massive and well-oiled campaign to install Vladimir Putin's hand-picked successor in 2008, Mr. Kasyanov is emerging as the last hope for Russia's beleaguered liberals to mount a credible challenge in the presidential race.

But few experts give the bear-sized Kasyanov, who served as head of Mr. Putin's government before being sacked in 2004, much chance of even making it into the starting gate.

This week, Kasyanov got a sharp taste of what to expect when the government refused to register his Russian People's Democratic Union as a political party. That could thwart its plans for running in next year's State Duma elections.

Kasyanov, who downplayed the rebuff and vowed to go forward with his campaign, says that Putin's crackdown on Russia's fledgling democracy is the main reason he plans to stand against the Kremlin.

"We're trying to explain to people that this is the only chance left that hasn't been taken away, their right to elect the president," says Kasyanov, who has been virtually blacked-out by Russia's state- dominated media.

Russia's constitution limits a president to two four-year terms. Despite rumors to the contrary, and an approval ratings hovering at 70 percent, Putin has repeatedly insisted – most recently Wednesday – that he will step down when his second term ends in March 2008. But experts say that Putin has revivedthetraditional Russian system of one-man rule, and warn that his departure will create upheaval.

"There is no tradition of orderly power transfer in Russia," says Alexei Makarkin, deputy director of the Center of Political Technologies, an independent think tank in Moscow. "Putin's at the top now, but if he leaves, there will be new rules. How will the system be rebalanced? It's the source of great worry."

Experts are calling it the "2008 problem." Putin has pledged to anoint a suitable successor in good time, but so far is playing that card close to his chest. A poll conducted last week by the independent Levada Center in Moscow found that 48 percent of Russians think Putin's handpicked heir will be the next leader, 23 percent foresee that Putin himself will remain, and just 14 percent think an outside candidate could be elected.

That puts Kasyanov and his liberals in a tough spot, says Valery Fyodorov, head of VTsIOM, a state-run polling agency. "They're waiting to decide on their strategy [for 2008], but the authorities aren't giving them much chance," he says. "Perhaps if the authorities make some mistakes, it will create an opening for them to go to the people."

Kasyanov insists that Putin was "on the right track" during his first term as president, introducing economic reforms and reinstating law and order after a post-Soviet decade of near chaos.

This is a delicate subject for the ex-prime minister, since he served the Kremlin in the early stages of its clampdown on independent media and the October 2003 arrest of Yukos oil tycoon Mikhail Khodorkovsky.

"For three-and-a-half years, I believed that Putin and I were of the same mind, and doing the right things," he says. As prime minister, Kasyanov spoke out against Khodorkovsky's arrest. He now says that he began to worry then about the country's direction. "The Yukos affair demonstrated that something was going wrong," he says.

But he also has other image problems. During his five years as deputy finance minister under former President Boris Yeltsin, the media nicknamed him "Misha Two Percent" based on rumors of kickbacks on major business deals.

And recently, a leading journalist, Alexander Khinshtein, has accused Kasyanov of improprieties in a housing transaction. Kasyanov denies all the allegations – no charges have ever been filed – but says they will almost certainly be used against him if he runs against Putin.

"Even if the political scene were free and clear of Kremlin control, Kasyanov would still have an image problem," says Masha Lipman, an expert with the Carnegie Center in Moscow. "Russian people tend to regard any government official as corrupt and self-seeking."

Putin fired Kasyanov just before the March 2004 presidential polls. But it was Putin's sharp authoritarian turn in late 2004, following the terrorist Beslan school siege, that transformed Kasyanov into an opponent, the ex-leader says.

"The gap between the state and the people is growing every day," says Kasyanov, who says that the relative prosperity his policies helped create are being used to mask the impact of lost freedom. "I never imagined the results of my work would be used this way, and that's why I've decided to step back into politics."

He adds that he's ready for an uphill slog. "I already have constant pressure on me, including tax audits and harassment of my activists in the regions," he says. "But we're fighting for the idea that free and fair elections are the only way out for Russia, and that's what we're going to stick with."