Strongman, The

strategic framework.” And I said. “Yes, sir.” ’ 26
    Within five months a new strategic arms limitation treaty had been cobbled together. It was rather less imposing than its predecessors, the SALT treaties of the Cold War era and the START treaties signed by Gorbachev and Yeltsin with George Bush Senior. Covering just a couple of sides of A4, it was pretty thin, and though it reduced each side’s nuclear arsenals, it lacked any verification provisions or even any obligation to destroy arsenals permanently. But both Bush and Putin needed it for its symbolism. These two leaders were getting on like a house on fire, and they needed a treaty to prove it.
    After the signing, Putin and his wife showed George and Laura Bush around the Kremlin, and then took them home to their dacha, where they did some fishing in a pond. Putin was repaying the Crawford experience. The next day they flew to Putin’s home town, St Petersburg, where they visited the city’s massive war memorial, the Hermitage gallery and the university. Putin then snuck off to attend a judo competition. And in the evening the presidential couples, with ministers and advisers in tow, went to a performance of the Nutcracker ballet at the celebrated Mariinsky Theatre.
    Here something curious happened. Condoleezza Rice and Sergei Ivanov had struck up a great friendship. And while both were lovers of ballet, neither of them wanted to sit through three hours of the Nutcracker . When the lights went down, Ivanov leaned over to Rice and said: ‘Condi, do you really want to watch the Nutcracker ?’
    ‘What do you have in mind?’
    ‘I have an alternative. Have you heard of the Eifman ballet?’
    Rice had heard of it. Boris Eifman was an avant-garde choreographer, much more to her taste. ‘Let’s go,’ she said.
    Ivanov and Rice slipped out of the Mariinsky and headed for Eifman’s studio. They sat side by side in the rehearsal studio, transfixed, sole viewers of a thrilling performance (apart from a somewhat disgruntled looking Vladimir Rushailo, the national security adviser, who had been sent as a chaperone).
    ‘I could see she loved it,’ Ivanov recalled later. ‘You can’t fake that sort of thing.’ 27
    They got back to the Mariinsky just before the lights went up, just in time to join the official delegations for a midnight canal trip around St Petersburg.
    ‘Personal relationships do matter,’ Rice confided in an interview. ‘I came to trust that Sergei Ivanov was someone who was going to deliver on what he said he would do, and I think he believed the same about me.’ 28
    It truly seemed like the dawn of a new era. Who could have imagined that it would all soon begin to disintegrate?

 
    3
THE BATTLE FOR ECONOMIC REFORM
    Putting a new team together
    It wasn’t just Putin’s foreign policies that impressed the West. At home, he launched a raft of economic reforms that won plaudits abroad, as they appeared to be aimed at stimulating the economy, entrenching the free market and consigning the last vestiges of communism to the dustbin.
    While still prime minister – before he was even acting president – Putin recruited a new team of Western-oriented reformers to draw up a programme. Some, like German Gref and Alexei Kudrin, he knew from his St Petersburg days. Andrei Illarionov was an outspoken liberal economist and Arkady Dvorkovich, a young whizz-kid, was just back from studies at Duke University. Putin himself was still an economic novice, willing to listen and learn, and convinced that things had to change. Kudrin described him in an interview as ‘a man of the next generation, who understood modern demands’. 1
    Under Yeltsin major projects had been carried out that had already transformed the economy, particularly mass privatisation and the liberalisation of prices. But the country did not enjoy sustainable economic growth, inflation was high and the new private sector worked inefficiently. Above all, the country’s industrial base remained almost entirely focused on the extraction and sale of raw materials – oil, gas, aluminium, timber – while there was scarcely any modern manufacturing.
    At the end of 1999 Putin put Gref, a 35-year-old lawyer-turned-businessman, in charge of a new Centre for Strategic Research, which became the engine room of the reforms. Gref, a bustling man with a pointed beard like Trotsky’s, was no economist, but few doubted he was the right man for the task. Deputy finance minister Kudrin