Boris Yeltsin, Boris-Yeltsin.com

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The End of an Era: As its first-ever elected president, Boris Yeltsin presided over his country’s transformation from totalitarianism to democracy. But Russia today is beset by economic despair, rampant corruption and war. His complicated legacy–and the nation’s tricky road ahead.

Even at the end, his flair for the dramatic was undiminished. The world was counting down the hours to a new millennium. On Friday morning in Moscow, a gentle snow was falling and, like everywhere else in the world, celebrations large and small were about to begin. If ever there was an out-with-the-old, in-with-the-new moment waiting to be seized, it was Dec. 31, 1999. Boris Nikolayevich Yeltsin did not let it pass. Early that morning he dispatched a close and loyal aide to the state-run television network, bearing an enormous surprise. Valentin Yumashev told the network’s officials that instead of the president’s usual New Year’s address, which normally airs just before midnight each Dec. 31, they should broadcast at noon a videotape that he then handed over.

In it, Yeltsin sat before a brightly decorated Christmas tree. Speaking slowly and with an unmistakable air of sadness, the Russian president began: “Friends, dear ones, today I am wishing you New Year’s greetings for the last time. But not only that. I am [also] addressing you for the last time as Russian president. I have made a decision… On the last day of the outgoing century, I am retiring.”

And just like that, the historic, tumultuous reign of Boris Yeltsin was over. He came to power in 1991, after prevailing in a power struggle with former Soviet leader Mikhail Gorbachev. On Dec. 25, 1991, he replaced the red hammer-and-sickle banner of the Soviet Union with the tricolored flag of the new Russia. In the eight years that followed, he presided over his country’s historic transformation from totalitarianism to a rough-hewn democracy. As president, he privatized a massive state-owned economy, bombed his own Parliament building, inflicted two ruble devaluations and two Chechen wars on his populace, endured a quintuple bypass operation and disposed of five different prime ministers. But on the very eve of the 21st century, Boris Yeltsin, a very old 68, was finally done.

The president said Russia needed to enter the next century with “new politicians [and] new faces.” And first among them, he made it clear, was his current prime minister, Vladimir Putin, who in his five months in office has ridden a vicious war in the breakaway region of Chechnya to widespread popularity. Putin will function as acting president for three months, in accordance with the Russian Constitution. New presidential elections will be held on March 26, three months ahead of schedule. “I have no doubt,” Yeltsin said in endorsing Putin, “what choice you will make.”

This was a different Boris Yeltsin from the one the world had come to know. Gone was the robust, defiant figure of eight years ago who had mounted a tank in the defense of democracy. But gone, too, was the politician who, some intimates insisted, simply lived for power, a man who when he finally left the Kremlin would do so feet first. If the figure on television last Friday was not a broken man, he was at least somber and properly humble.

On his last day in office, Yeltsin acknowledged for the first time what is plainly obvious to most of Russia’s citizens: his era, which began with such soaring possibility, has declined into a dispiriting mix of economic despair, rampant corruption and war. And for that reality, Yeltsin was contrite. “I want to ask your forgiveness,” he said, “because many of our hopes have not come true, because what we thought would be easy turned out to be painfully difficult. I ask you to forgive me.”

It was a striking choice of words. Russian tsars asked only God for forgiveness; Soviet general secretaries never asked anyone at all. For Yeltsin to beg pardon from the Russian people was an unprecedented and moving touch, one that will burnish the legacy he cares so much about. “He entered with dignity, and he left with dignity,” says Boris Nemtsov, a former deputy prime minister, for a time thought to be a possible Yeltsin heir.

Yeltsin must also have had in mind another sort of forgiveness as he contemplated resigning his presidency. For more than a year, serious corruption allegations have swirled around him and his immediate circle of family members and close associates. The president’s advisers have been intent on making sure both he and his family received guarantees against any prosecution once the president left office. Having a man they can trust as Yeltsin’s successor was central to that strategy.

That now has been taken care of. Yeltsin and his immediate family have been given immunity guarantees. The order was one of Putin’s first presidential decrees. It’s a guarantee Yeltsin may be very glad to have. NEWSWEEK has learned that Swiss authorities, in the context of their ongoing investigation into Russian money laundering, last summer froze at least a dozen bank accounts containing upwards of $15 million that they suspect may be linked to Boris Yeltsin himself. Sources say that the accounts in question are not in Yeltsin’s name, but rather are held by offshore companies or in the names of in-dividual businessmen, both Russian and foreign. Yeltsin’s aides have consistently denied that the president has any foreign bank accounts, and the freezing of the accounts does not necessarily imply any wrongdoing.

Corruption charges have dogged Yeltsin since last summer, when political foes raised the issue and forced an impeachment vote in the Duma. Yeltsin won the vote, but the episode deeply frightened his inner circle, led by his 39-year-old daughter Tatyana, longtime aide Yumashev and business “oligarch” Boris Berezovsky. Yevgeny Primakov, then prime minister, had made it known during the battle that he supported immunity for the president–but for no one else around him. Yeltsin sacked Primakov last May, and the former prime minister later entered into a political alliance with powerful Moscow Mayor Yuri Luzhkov–by then openly hostile to Yeltsin. The partnership only deepened the sense of panic in the Kremlin, because Primakov was suddenly the front runner to succeed Yeltsin in elections scheduled for the summer of 2000.

Enter Vladimir Putin. Primakov’s immediate successor had been Sergei Stepashin, a former chief of the Federal Security Service (a successor agency to the KGB) who had helped command Russia’s first disastrous foray into Chechnya in 1994. But the “Family,” as Yeltsin’s inner circle is known in Moscow, quickly came to view Stepashin as too weak to counter the Primakov-Luzhkov threat. Yeltsin sacked him in August, and named Putin as his successor.

What has happened since then has been remarkable–and will be the stuff of bitter controversy in Russia for decades to come. In late August, declaring a desire to create a Pan-Islamic state out of Russian territory, a feared Chechen commander named Shamil Basayev made a series of military raids across the Chechen border into the neighboring region of Dagestan. While Chechnya had negotiated for itself a form of autonomy from Moscow in 1996, Dagestan remains Russian soil. Moscow’s military considered the raids a brazen assault on Russian sovereignty and responded fiercely, engaging the rebels in a series of furious battles, eventually driving them back across the border.

When he nominated 47-year-old Putin as his prime minister, Yeltsin called him a worthy successor. But given his history of disposing of prime ministers like so many pieces of used tissue, few in Moscow took that seriously. “Putin is his successor until he finds another one,” one cynical former Kremlin staffer put it at the time. But in late August and September, a series of deadly bomb blasts in Moscow and two southern cities terrified Russia. About 300 people were killed, and the authorities, Putin included, blamed the attacks on Chechen rebels. The war, with the new prime minister very publicly in charge, escalated. And the political climate in Russia began to change profoundly. The war was (and remains) immensely popular. For a lot of Russians, the pounding of Chechnya served as a release of enormous pent-up frustration after years of economic decline and diminishing Russian influence abroad.

Coincidentally or not–and Yeltsin’s opponents do not believe it is a coincidence–the conflict escalated during the run-up to Russia’s third parliamentary election of the 1990s, held on Dec. 19. At the start of the campaign, the Luzhkov-Primakov alliance, known as the Fatherland-All Russia Party, seemed prepared to challenge the communists as the top vote getters nationally. And a strong showing for the party would clearly make Primakov the front runner to succeed Yeltsin. The Kremlin had its own block of candidates, who ran under the banner of the Unity party. Yeltsin’s team tied Unity’s fate firmly to Putin and his conduct of the war in Chechnya, while Yeltsin, as he had so many times before, largely disappeared from public view.

On Dec. 19, after a campaign of extraordinarily vigorous mudslinging, the brilliance–or cynicism–of the strategy became clear. The Fatherland party slumped to a poor third. Unity, a party that stood for nothing except support for the war and for Putin, nearly beat the communists for first place. Yeltsin’s opponents were stunned. Sources tell NEWSWEEK that on Dec. 24, less than one week after the election, Yeltsin made his decision. After consulting with his family and some members of the Kremlin, Yeltsin decided to retire. The only issue was when he would announce it. The decision remained a tightly held secret for nearly a week. Then, apparently on the 30th, Yeltsin decided he would go out with the millennium. Putin’s victory was complete.

In his speech, Yeltsin portrayed his resignation as a rational decision. He said the Duma elections had convinced him that he “had done the main job of my life,” and that it was time to go. “Russia will never return to the past,” he said. “Russia will always be moving forward, and I must not stand in its way. Why hold onto power,” he asked finally, “just for six more months?” But to Yeltsin’s political opponents, the question was not why–but why not. Yeltsin insisted he was “not leaving because of my health,” though sources tell NEWSWEEK that, in fact, his overall health has worsened significantly in the last few weeks. No, the president said cryptically, he was going “because of all the problems taken together.”

Yeltsin’s enemies believe that his exit was the last act in a play that had been better scripted than the Kremlin had ever dreamed it could be. “They created a splendid little war,” one Russian legislator says. “Now they can elect their man, and they will.” The risk that the war in Chechnya could eventually turn bad, according to this view, means the Kremlin did not want to wait six long months for an election, scheduled for late June. Three months minimizes the risk. “That is what this was all about,” says the legislator. Foes believe that Putin’s guarantee of immunity for Yeltsin was simply the next-to-last scene in the drama, part of a deal cut some time ago. The last will be Putin’s election in late March.

For now, a Putin victory looks all but inevitable. With Russian forces on the brink of capturing Grozny, the Chechen capital, the war continues to go Russia’s way. Meanwhile, Putin’s opposition is fractured. The situation “right now looks like total victory for the Kremlin,” says a former senior Kremlin aide.

History will struggle with Boris Yeltsin. To his admirers, who include Bill Clinton and most Western leaders, he is the “father of Russian democracy,” as the American president said last week. But the Yeltsin record at best is one of “deep contradictions,” as Lilia Shevtsova, a senior associate at the Carnegie Endowment in Moscow, puts it. His fans say that in times of crisis, such as the armed attack on a rebellious, communist-led legislature in 1993, he has always sought “reaffirmation with the people–the true instinct of a democrat,” as Sandy Berger, Clinton’s national-security adviser, says. His critics look at the same event and see it as a barbarically unconstitutional assault on a democratically elected branch of Russia’s new government. The pro-Yeltsin camp says he will be remembered for privatizing, however messily, a huge, horribly inefficient state-run economy in just four years. Critics see his economy as a corruption-ridden disaster that has failed to raise Russia’s standard of living.

In the end, if Russia is a functioning democracy 50 years from now, the corruption, the drinking and the poor health–the things that now seem so familiar about Yeltsin–will fade. But that means, in a very real sense, that his historical fate lies now with his successors–starting with a tough, calculating KGB man. It is to Vladmir Putin that Boris Yeltsin has now entrusted his democratic legacy, as well as the precious freedoms (press, speech, judicial redress) that Russian citizens at long last have. It would be reassuring, as the 20th century came to an end, to think that in this, his final act, the man who has dominated his country for a decade had acted wisely. Reassuring; but alas, very premature.

Twentieth-Century Man

On the eve of the new millennium, Boris Yeltsin announced his resignation in a televised address to the nation. Yeltsin’s term was to run until next July.