July 15, 1997   

This Date's Issues:   1047 •1048  1049 1050 1051

Johnson's Russia List [list two]
#1051
15 July 1997
djohnson@cdi.org

[Note from David Johnson:
1. RIA Novosti: UKRAINIAN PARLIAMENT COOL ON LEFT PROTESTS 
AGAINST SEA-BREEZE 97 MULTINATIONAL EXERCISES ON 
BLACK SEA.
2. Boston Globe: David Shribman, The lessons of Stalin's Russia.
3. Rossiiskaya Gazeta: SERGEI DUBININ: "I SAW CORRUPTION."
Statement by the Bank of Russia Chairman.
4. Radio Rossii Network: Interior Ministry Official Says Number of 
Crimes Decreasing.
5. RIA Novosti: NIKONOV: SKLYAROV WON AS INDEPENDENT POLITICIAN 
THOUGH BACKED BY NEMTSOV.
6. RIA Novosti: ALEXANDER LEBED AND GENNADY ZYUGANOV WILL 
PERSONALLY SUPPORT THEIR CANDIDATES RUNNING FOR IRKUTSK GOVERNOR.
7. Nezavisimaya Gazeta: CONSTITUTIONAL COURT SHIES NO CONTROVERSIES.
But Its Rulings Should Not Undermine Russia's State System, 
CC Chairman Marat Baglai Believes.
8. Boston Globe: Thomas Oliphant, New vision for NATO. 
9. Wall Street Journal: Alexei Bayer, A New Capital For a Capitalist Russia.
10. San Jose Mercury: Patrick Buchanan, America's new NATO noose.
11. Asia Times: Squabble over Caspian oilfields.]

********

#1
UKRAINIAN PARLIAMENT COOL ON LEFT PROTESTS AGAINST 
SEA-BREEZE 97 MULTINATIONAL EXERCISES ON BLACK SEA 
By RIA Novosti correspondent Viktor Demidenko
KIEV, JULY 15 /RIA NOVOSTI/ -- The Supreme Soviet of
Ukraine, meeting for a plenary session today, did not give its
backing to the left forces that raised in parliament the
question of banning Sea-Breeze-97 multinational exercises on the
Black Sea with the participation of NATO ships. 
They will go ahead, as planned earlier, late in August 25
kilometres off Yevpatoriya. 
The arguments cited by deputies representing the interests
of the socialist, Communist and agrarian parties who wanted the
exercised banned, found no support in the Supreme Soviet. 
The Supreme Soviet also turned down a proposal to move the
exercises to a later date. 
The Defence Minister, who took the floor, noted Ukraine was
spending no money from the treasury on the exercises. Ukraine's
participation in NATO programmes, according to him, is
subsidised by NATO countries. 
The current exercises will involve Bulgaria, Romania,
Georgia, Italy, Turkey, Greece and Ukraine. Taking part in them
will be 20 ships, 300 Marines, three air force planes, and six
helicopters. 

*********

#2
Boston Globe
15 July 1997
[for personal use only]
NATIONAL PERSPECTIVE
The lessons of Stalin's Russia 
By David M. Shribman, Globe Staff

WASHINGTON - President Clinton is back from Europe and a heady thought is
drifting through his mind: the possibility of a united democratic Europe at
peace for the first time in history. But before he gets carried away in his
summertime reverie, he ought to turn on his television set. 
The most startling viewing this season isn't the congressional inquiry
on Moneygate. It's a 10-hour retrospective on Russia and Europe during the
Stalin years. It's also a reminder that tribal rivalries and nationalist
excess have always found fertile ground in Europe - and that the two
signature elements of modern life, technology and mass communication, were
turned to their most brutal ends in Europe. 
For much of this month, public television stations are airing ``Russia's
War: Blood Upon the Snow'' (Mondays at 9 p.m. on WGBX - Channel 44), and
the footage is rare, authentic, historic - and chilling. 
It is an intimate portrait of Stalin's Russia, and it is not a pretty
sight. Twenty million were killed in internal squabbles and disputes so
arcane and artificial that they defy rational explanation, and then an
additional 25 million were killed in the war against another master of
prisons, slave labor, and planned extermination - Adolf Hitler. 
Now, at century's end, when there is a breath of peace, it is still
useful to remember that the story of this century, and of Soviet Russia
(whose entire history from beginning to end occurs within the parentheses
of the 20th century) is of brutality. Indeed, what the Nazis tried to do in
Europe, and what the Russians did in their battle against Germany, are
equally brutal. There is no more vivid evidence of this than the fact that
some Russians resorted to cannibalism during the 900-day siege of Leningrad. 
It will be no coincidence, as the Soviets used to say, that we will not
be able to explain this to our kids. 

Lessons for a world 

But the other afternoon a handful of Washington's leading Russia hands
gathered in a small room to discuss the film series and to wonder, out
loud, about the lessons it held for a world that knows of Josef Stalin only
as a figure of history. They turned, as historians often do, to perhaps the
most momentous event of World War II, the day in June 1941 when Germany
abandoned its alliance with Russia and began the great land invasion of the
biggest and coldest country on earth. 
It was a classic incident, with lessons for all time, especially ours.
It was an example of a major power closing its eyes to what its
intelligence sources were saying. In our own time, of course, we have, as
retired Lieutenant General William Odom, a onetime head of the National
Security Agency put it, ``seen numerous occasions when leaders ignore
intelligence reports.''
This time, the agents who warned of an imminent attack on the Soviet
Union were ordered to be turned into prison dust. They were. And the
Germans attacked. ``In intelligence, no good deed goes unpunished,'' says
R. James Woolsey, former director of Central Intelligence. ``Policy makers
talk about intelligence failures when the failures are their own.''
Rather than tricking Hitler by luring him into an alliance with the
other great continental power in Europe, Stalin tricked himself into
complacency. And when he learned the truth of his great failure, he reacted
with despondency and depression. His foolishness had been laid bare, and
even one standard explanation - that he knew the Soviet Army wasn't ready
for war and was simply buying time - rings false. 

All too familiar 

``Stalin,'' says Fedor M. Burlatsky, longtime editor and commentator for
Moscow's Literaturanaya Gazette, ``didn't use the time.'' By joining with
Germany in 1939 and carving up Poland, he removed a huge buffer between two
nations whose leaders were too terrible, too prone to overreaching, too
consumed by national dignity and national destiny, to exist on the same
land mass. 
Much in this film series is familiar, all too familiar in the century
that invented and then perfected genocide. But there is a historical
curiosity here, too, and it appears in the ninth hour of the series. The
film producers reveal that Soviet security forces, under orders from Soviet
leader Leonid I. Brezhnev and KGB director Yuri Andropov, crushed the bones
of Hitler and his wife, Eva Braun, that had been found in secret tombs in
East Germany. They scattered the ashes over German marshlands. 
Only fragments of those skeletons still exist, Hitler's teeth and part
of his skull, a bullet hole showing clearly. But in truth the skeletons of
Hitler, and of Stalin, and of the millions whose deaths they caused still
exist, and they are guideposts to us now, as we contemplate the possibility
of a united democratic Europe at peace for the first time in history. They
warn us that peace is fragile and that high hopes are a human impulse - and
a human weakness. 


**********

#3
>From RIA Novosti
Rossiiskaya Gazeta 
July 15, 1997
SERGEI DUBININ: "I SAW CORRUPTION"
Statement by the Bank of Russia Chairman

While studying reports of an audit of the Unikombank's
operations with securities, I saw symptoms of an ailment whose
foreign name has been fully Russified: corruption. 
I was pondering a difficult choice: whether the audit
should be made more indepth in order to obtain specific proof
and thus face the consequences, or stop the audit and become a
silent, and immoral, accomplice. Today, I have no doubt that I
have made the right choice. 
To produce a diagnosis, one has to be surgically accurate
in assessing the facts.
First. Former first deputy finance minister Andrei Vavilov
has on two occasions, in 1996 and 1997, concluded agreements on
advance payments of budgetary funds, which were processed by
several banks in the form of domestic currency loan bonds. The
bonds have finally reached the Unikombank accounts and been
sold by it, and the proceeds have been misused and not given to
the borrowers. The losses inherent in the first deal with the
Moscow Region administration stand at US$ 275 million, and the
losses incurred by the second deal, with the MAPO-MIG aircraft
producer, are assessed at US$ 237 million in the very least.
Second. In handling the budgetary allocations, the finance
ministry has violated the approved procedures and regulations
on many a count. I am stating this as a former finance
minister. Finance ministers Alexander Livshits and Anatoly
Chubais knew nothing of the deals. 
Third. The Unikombank management has grossly violated the
regulations of handing the domestic currency loan bonds and
accounting. The other banks involved in the deal seem to have
been doing in good faith what their clients have instructed
them to do. The Bank of Russia will thus stay within its powers
to make claims of Unikombank and its management who have
violated many rules of banking. Their activities from the
viewpoint of the Penal Code are to be assessed by the
prosecutor's office and the court. 
Fourth. The budgetary allocations have been
misappropriated. In the case of MAPO-MIG, they have not been
used to build aircraft. If the contract has been executed at
all, the financing must have come from other sources. 
Unikombank has effectively grabbed the money. In the case of
the deal with the Moscow Region administration, the bank has
undertaken to manage the funds which, with the exception of a
small portion, has not been returned in time. The money has not
been spent to pay debts in the social sphere, and a part of it
was transferred to the bank's branch in Barbados. The
"simplicity" with which it has been done is surprising, as if
nobody has really tried to conceal the deed. The Bank of Russia
has sent all relevant documents to the prosecutor's office. 
The "central characters" will put up a fight, of course.
They will try to make investigation more difficult by
references to instructions from above. But they have been
instructed to aid the state-sector workers, rather than
misapropriate the budgetary funds. They will say they have
fallen victim to intrigues and pose as political figures
suffering for their beliefs. What they should do is return the
money and let's discuss their political beliefs later. 
Will there be a court hearing? Will the money return to
the budget? For the money is badly needed to pay the
state-sector workers - medics, teachers and the military.
I am confident that our society will view this case as a
demonstration of the state authorities' efficiency in
protecting the law.

*********

#4
Interior Ministry Official Says Number of Crimes Decreasing 

Radio Rossii Network
July 11, 1997
[translation for personal use only]

A meeting of the collegium of the main internal affairs directorate is
under way in Moscow. Mayor Yuriy Luzhkov and top law enforcement officials
of Moscow and Moscow Region are taking part in it. Lt. Gen. Nikolay
Kulikov, head of Moscow's main internal affairs directorate, briefed those
present on the results of the first six months of the year.
[Begin Kulikov recording] The internal affairs bodies are in control
of the situation in the city as a whole. As a result, the number of
registered crimes continues to decrease. There was a 20 percent drop in
the number of registered crimes in comparison with the same period of last
year, and 37,000 crimes were committed. The number of grave offenses
against individuals, including murders, cases of premeditated infliction of
bodily harm, and rapes was also down. The number of (?recorded) cases of
violent attacks, robberies and thefts, including burglaries and crimes
involving illegal ownership of vehicles and the use of firearms and
explosive devices was down, too. Crime was on the decrease in all
administrative districts, but the most significant improvement was noted in
southeastern, western, and northwestern districts. Certain positive
results were achieved in investigating and solving crimes. Figures show
that 82 percent of all crimes were solved, as were 76 percent of serious
and extremely serious crimes. Our units are more organized now and the
resources are being used more efficiently.
At the same time one must acknowledge that despite these positive
statistics serious problems do still exist. We cannot reconcile ourselves
to the fact that criminals got away with committing [number indistinct]
murders and acts of bodily harm in the six months, over 4,500 violent
attacks, thefts and burglaries and other crimes. Our main task is to
ensure that those who commit crimes are always punished. [end recording]

*********

#5
NIKONOV: SKLYAROV WON AS INDEPENDENT POLITICIAN THOUGH 
BACKED BY NEMTSOV
MOSCOW, JULY 15 (RIA NOVOSTI CORRESPONDENT MARIYA BALYNINA)
-- The elections of the governor of the Nizhny Novgorod region
held last Sunday were "instructive" ones because the matter
concerned Boris Nemtsov`s successor, one of the most prominent
reformatory leaders in Russia, Vyacheslav Nikonov, politologist
and president of the Politika Fund, said in an exclusive
interview with a RIA NOVOSTI correspondent. It is not by chance
that the opposition forces viewed these elections as the most
important ones in the light of their offensive in the scale of
the whole country.
According to Nikonov, the victory of Ivan Sklyarov, Nizhny
Novgorod Mayor, at the elections of the Nizhny Novgorod region
governor "actually means very much" for Boris Nemtsov because it
has strengthened positions of Russia`s first deputy prime
minister. "If the opposition won, it would mean that Nemtsov has
lost his political and geographical basis and results of his
rule in the region were refuted," he said.
At the same time Nikonov pointed out that he would not view
Sklyarov`s victory only as "Nemtsov`s victory." He said that in
the course of the election campaign Sklyarov substantially
distanced himself from the support of the first deputy prime
minister "wishing to show himself as an independent political
figure." "Sklyarov, who allows himself to criticize the federal
center has won as an independent politician, though Nemtsov`s
support, let it be a restricted one, has played its role,"
Nikonov said. 

***********

#6
ALEXANDER LEBED AND GENNADY ZYUGANOV WILL PERSONALLY
SUPPORT THEIR CANDIDATES RUNNING FOR IRKUTSK GOVERNOR
IRKUTSK, JULY 15 /FROM RIA NOVOSTI CORRESPONDENT ALEXANDER
BATALIN/--Former presidential security adviser Alexander Lebed
is arriving in Irkutsk today. The purpose of his visit is to
support director general of the VOSTSIBUGOL joint-stock company
Ivan Shchadov who is running for Irkutsk governor. The election
will be held on July 27.
His contender for this post, leader of local communists
and national-patriots, Sergey Levchenko got also a supporting
hand from Moscow in the face of general Valentin Varennikov who
is presently on visit in Irkutsk. Communist leader Gennady
Zyuganov plans to help Varennikov on July 22.
The two aforementioned candidates together with incumbent
mayor Boris Govorin head the list of contenders, say local
opinion polls. Their rating is far above popularity of the other
six also-runs.
Incumbent mayor Boris Govorin is enjoys support from Yuri
Nozhikov. This fact was disclosed by Mr. Nozhikov in the
press.

**********

#7
>From RIA Novosti
Nezavisimaya Gazeta
July 12, 1997
CONSTITUTIONAL COURT SHIES NO CONTROVERSIES
But Its Rulings Should Not Undermine Russia's State System, 
CC Chairman Marat Baglai Believes

NG: Did you have to introduce many structural changes
following your election to the Constitutional Court's
chairmanship on 20 February 1997?
MB: Ever since 1995, when the Constitutional Court (CC)
was fully staffed, it has been operating in a regime and within
an organisational format that I did not have to change. The CC
was placed on the rails along which it has been moving ever
since, and I did not have to effect any principal
transformations. 
NG: But the State Duma discussion of amendments to the law
on the Constitutional Court was said to be explained by
deficiencies in its work. The authors of the bill claimed that
the CC was moving along the well-grounded tracks but in the
wrong direction. Your opinion?
MB: I disagree. I do not want to itemise the legislators'
speeches - they have the right to assess our work in their own
particular way - but I cannot agree with the claims that the
court does not correspond to its calling or the criteria of
justice and morality. In this respect, we are being supported
by the much more representative part of our society, the legal
people and the mass media whose vision of the CC is much more
positive. 
NG: But the media also criticise the court for shying
controversial issues. Many people are talking these days of the
huge resources paid from the federal budget for the maintenance
of the Federation Council members. Clearly, the monthly trips
of the regional administration heads to Moscow and back cost a
pretty penny. The CC, meanwhile, has refused to consider the
inquiry about the constitutionality of the upper chamber's
formation. How do you explain this?
MB: Criticism addressed to the court is normal. To uphold
the democratic methods in our work, we must heed the opinion of
others. Our position on your question should not be viewed from
the point of view of expediency. The only consideration for us
is whether there are sufficient grounds for such an inquiry. I
am not talking of the political side to that matter - everyone
can see the rationale behind the current principle of forming
the Federation Council. But the court does not meddle in
politics. We replied to the State Duma's inquiry that the lower
house can well initiate legislation. Under the Constitution, it
can adopt laws and can amend or add to a law it has adopted. 
Nor can one interfere in the prerogatives of the
Federation members who have the right to decide who must
represent their bodies of state authority in the upper house.
Its formation is done in line with the relevant federal law -
as stipulated in the Constitution. 
So I cannot agree with the claims that we have dodged this
controversy. Can we"cripple" the house and thus check the
legislative process? It is not for us to decide who represents
the Federation members in the Federal Assembly. 
Our rulings must not undermine the system of state power
in the country. The phrase which is "in" with many a lawyer:
"Long live justice and let the world perish" is not a rule for
us. 
NG: Do you mean that if the inquiry was formulated
differently, i.e. if the Constitutional Court was to be asked
to interpret the Constitution and rule whether the head of a
region's executive authority can also be a lawmaker and possess
parliamentary immunity into the bargain, whether this does not
contradict the principle of the delineation of powers, you
could consider the matter?
MB: If we get a duly formulated inquiry to interpret the
Constitution, we must consider it. The CC has never refused to
interpret the Constitution. I do not mean requests to produce
theoretical rulings which have no practical application, or to
verify whether some articles of the Constitution do not
contradict other articles. We cannot do this by force of our
powers as spelled out in the legislation. 
NG: But the CC has refused to consider the issue of the
lower chamber's formation techniques. I mean the 5% eligibility
barrier built into the election legislation. But the CC is
known to have received a repeat inquiry to verify whether this
is legal to have only those parties and movements represented
in parliament that have cleared the 5% eligibility barrier.
Your comment?
MB: We have the inquiry by the Union of Students' Councils
and the CC members are yet to decide whether to consider it or
not. The difference of the new inquiry from a similar inquiry
that we considered in late 1995 is that the election campaign
was well under way then, the Constitutional and legal
relationships were in working and our ruling to protect the
rights of some would mean a violation of the rights of other
participants in the Constitutional and legal
interrelationships. Moreover, that inquiry had a clear bearing
on the political interests of various groups of people which
vied for seats on the Duma, and it was unacceptable for us to
get involved in this struggle. 
Today, no election campaign is under way, there are no
political considerations, and the inquiry has not been made by
a participant in elections whom we could suspect of trying to
change the rules of the game once the game has started.
Therefore, I would not venture to forecast whether the inquiry
will be accepted for consideration or not. 
NG: Among the cases that the CC has heard following your
election to the post and that have been in the focus of public
attention, I would like to highlight yet another attempt to
make the procedure of residence registration constitutional.
The CC ruling on the relevant Moscow Region law differs from
the one that had a bearing on the interests of several regions.
Back then, the court reiterated the right of the Federation
members to institute their own taxes and duties and only saw
the exorbitant taxes as un-constitutional; this time, the CC
clearly stated that the list of taxes and duties can only be
stipulated in the federal legislation. Your comment?
MB: In the former case, we acted in line with a
Presidential decree which allowed the regions to introduce
their own duties, but the decree has been abrogated and the
current law has stripped the Federation members of such powers.
NG: The Moscow government has disliked even that
half-hearted ruling of the Constitutional Court. Did Mayor Yuri
Luzhkov admonish the CC?
MB: We have had no contacts with the Moscow Mayor. Nor did
we seek such contacts while the case was under consideration,
for we could have placed ourselves in a position open for
pressure. But Luzhkov did not attempt to pressurise us. In
general, no admonitions matter.
So the ruling was done independently and the CC was guided
exclusively by the striving to defend the lawful rights of
citizens. 
NG: Nonetheless, there is a clear conflict of interests.
Luzhkov, and he is not alone, is protecting the rights of
Muscovites who are not interested in the purchase of housing by
aliens. There have been many cases where real estate operations
would violate the legislation and many housing owners have
fallen victim to criminals simply because housing is very
expensive there days. Will not the court's image suffer in
Moscow which is taking the uncontrolled migration very close to
heart?
MB: The contradiction you are talking about is well-known
to me. As a judge, I have expressed my special opinion that in
protecting the rights of some, the court should not forget
about the rights of others. The uncontrolled migration is very
dangerous, it may have some very bad consequences. 
But as the CC chairman I must represent the stance of the
court which is trying to protect the citizens' right to free
movement and choice of residence. We can then ponder ways to
combine this important right with the effort to protect other,
no less important rights. 
NG: Our politicians are making believe that they are
concerned over the rights of the ethnic Russians and the
Russian speakers. Are you not surprised that there have been no
attempts to dispute an international accord in the CC?
Meanwhile, they are many, and some of them have been concluded
with countries accused of human rights violations. Your
opinion?
MB: Admittedly, not only this issue has been missing from
the CC activities. We have never been addressed in connection
with the ratification of an international accord. Nor have we
considered inquiries to dispute powers. As a rule, it is the
normative acts that are being disputed. And of course, there
are many complaints from individual citizens. They are so many
that now that we have devised a schedule of CC sessions, it has
become clear that we are receiving much more requests and
inquiries than we could hope to consider. 
NG: Of course, if the court is forced to consider
practically analogous problems in the different members of the
Federation, having 19 members is not nearly enough. Sometimes,
similar inquiries can be considered in a package. But what is
there to be done when the CC receives an inquiry after it has
ruled on a similar case in an adjacent region? Should not CC
rulings be made precedent-setting?
MB: If the law on the Constitutional Court contained a
provision to make CC rulings precedent-setting, the legal
discipline of our verdicts would have been enhanced. But the
law simply makes our rulings universally obligatory. And we
have always hoped that the Federation members which are facing
similar situations can apply the CC rulings on other regions to
themselves. Sometimes it happens, but more often than not, they
don't.
NG: Do the federal authorities bend to CC rulings?
MB: One can say that the executive authorities are
actively implementing our rulings, e.g. when we rule that the
government's resolutions are un-constitutional. The case of
Udmurtia provides an example. The President then hurried to
decree that the CC rulings are binding on the republic's
leadership. But many rulings call for active support on the
part of the executive authorities. 
NG: Do you think that when it comes to disputed powers,
the first case will be the Federation Council's inquiry on the
laws on trophy art and the RF government that the President has
declined to sign?
MB: I would not hurry to make such conclusions, for the
text of the inquiry is yet to be approved. There have been
cases where following debates around intended inquiries the
inquiries would not have been forwarded to the CC. Also, I have
heard that the Federation Council may decide to formulate the
inquiry as a request to interpret the Constitution's articles
on the procedure of adopting federal laws.

*********

#8
Boston Globe
15 July 1997
[for personal use only]
New vision for NATO 
By Thomas Oliphant, Globe Staff, Globe Columnist
WASHINGTON
No one noticed, but President Clinton picked an interesting example of a
security problem last week to illustrate his near-crusade for a new Europe
anchored by a continued partnership with the United States. 
Instead of some potentially aggressive national enemy, the president
cited the recent arrest in Florida of two Lithuanian nationals accused of
attempting to peddle nuclear weapons material from former foe and former
country, the Soviet Union. 
It still isn't known, he noted, whether the two men could have delivered
the goods, but what they are charged with is an illustration of the real
transnational threats that face what we used to call the West right now. 
To the president, nothing is less relevant to the realities of the 1990s
than the balance of power thinking and alliance politics of other eras, the
Cold War included. In his thinking, the future of NATO is huge, but
nonetheless just a part of a larger security system he envisages as
encompassing the entire continent, in which every country - from tiny
Albania to Russia - can enjoy the economic and political benefits of an
atmosphere that is free of division, conflict, and dictatorship. 
According to a top White House foreign policy official, the starting
point may be a dynamic NATO, as opposed to one ``frozen in the amber of the
Cold War.'' But the administration's strategy is focused on harnessing the
``centrifugal forces'' around the alliance. 
To illustrate, it's worth noting the semi-surprises from the president's
latest foreign policy foray. Obviously, they do not include the 16-member
alliance's formal, prearranged invitation to Poland, Hungary, and the Czech
Republic to begin negotiations for membership that are likely to be
concluded this fall. Nor do they include the explicit encouragement of
Romania, Slovenia, and the Baltic states to stay their reformist courses. 
Instead, it's more revealing to note three other occurrences during
Clinton's trip: his tumultuous reception in Bucharest, the decision to
mount an operation to snatch an indicted war criminal in Bosnia, and the
conclusion of a security partnership agreement with Ukraine remarkably
similar to the one formalized with Russia in the spring. 
The huge rally the president addressed in Romania was meticulously
advanced, but it dramatically emphasized the country's determination to
press on with its still-nascent reformation. Far from being bitter at not
being invited now to join NATO, the rally demonstrated Romania's
encouragement at being invited to work even harder to fulfill its obvious
Western-leaning aspirations. 
According to another senior administration foreign policy maker, NATO's
prudent enlargement must be continual or it will ultimately fail. Simply to
add three members, he said, would only lower a new ``curtain'' in Europe,
behind which trouble and eventually division would fester. 
The continued mess in post-Dayton Bosnia, on the other hand, illustrated
the imperative that NATO see its commitments through. The surprise
operation to grab a Bosnian Serb, who was killed resisting British
soldiers, illustrates a fresh determination to enforce the Dayton
agreement. However, it also illustrates its fragility. With 1,000 troops as
part of the otherwise NATO force, Serb-oriented Russia's anger at the
attempted arrest was ominous but so far restrained. 
More hurdles remain, especially as President Clinton tries to prepare
Congress and the public for the replacement of the existing NATO mission
with a follow-on presence after next summer that will almost certainly
include Americans. For his vision to succeed, a new NATO simply must be
able to manage Europe-only operations, and Bosnia's horror cannot be
permitted to begin again. 
As Russia's role in Bosnia (still essentially positive) shows, Clinton's
Europe requires partnership-like involvement with the emerging democracies
of the East. 
The conclusion of a security arrangement with Russia was critical, but
just as important was the announcement in Madrid of a deal with Ukraine. In
this complex square dance, a dynamic NATO must be constructively tied to
countries not likely to join but which greatly need options beyond eventual
reabsorbtion into a new Soviet Union. More than Texas-sized, with some 50
million people, Ukraine can now have that option. 
Clinton's emerging strategic vision has caught Russophiles and America
Firsters off guard with its breadth and its side deals, and also with its
bipartisan flavor. Top officials are nonetheless correct in their wariness
about next year's campaign for Senate ratification of the changes in the
basic NATO treaty. The issue they worry about most is currently too cloudy
for comfort: cost. 
But I think the sleeper is Bosnia. Things will be coming to a head there
just as the Senate takes up the NATO issue. Clinton has been prudently
quiet, but the follow-on mission, along with the vigorous implementation of
Dayton's provisions, will be tricky. 
Cost issues and foreign policy concepts are one things, but Bosnia is
real. The dreams and plans matter, but for Clinton's new Europe to earn
support, it must show it can contain and get past a genuine crisis. 

**********

#9
Wall Street Journal
15 July 1997
[for personal use only]
A New Capital For a Capitalist Russia
By ALEXEI BAYER
Mr. Bayer is senior economist at Kafan FX Information Services in New York.

In the early 1980s, Russian dissident writer Vladimir Voynovich wrote a
satirical dystopian novel, "Moscow 2042." It was a biting description of a
Soviet society of the future, in which a sordid communism built in a single
city is walled off and separated from the rest of a hostile country. Just
the opposite is happening in Russia today. A prosperous, capitalist state
has been created in the midst of an economically depressed, and all too
frequently hostile, Mother Russia.
This division imperils reform in Russia, and calls for a drastic step: Move
the capital out of Moscow.
Moscow was the Soviet Union's nerve center, housing all the ministries and
agencies required to run a far-flung empire. It was the cultural hub, the
military headquarters, the university town, the science and research center.
It concentrated huge industrial power: two auto makers, steelworks, chemical
companies, machine-building enterprises and scores of other factories big
and small. All transportation networks ran through Moscow, so that to travel
from the Urals east to Siberia, for example, it was often easier to first
travel west, to Moscow.
If anything Moscow's weight has increased in the new free-market Russia.
Giant privatized corporations, such as Gazprom and Lukoil, have established
headquarters there, taking over old ministerial buildings or constructing
opulent office towers. Most of Russia's successful startups in high-tech and
service industries are located there, as are the best stores, hotels and
wholesale and import companies. Moscow is the financial hub, the home of the
stock exchange and the largest, most successful private banks--which over
the past two years have become industrial conglomerates, accumulating
controlling stakes in privatized companies.
In fact, Moscow, with barely 5% of the country's population, accounts for
nearly 35% of its gross domestic product--taking into account the private
sector and the "gray" economy, which escapes official statistics. A whopping
80% of Russia's financial resources are concentrated in Moscow.
Moscow's economy is growing by leaps and bounds. Although no one has
reliable figures (least of all government agencies, since entrepreneurs take
pains to hide profits from confiscatory taxes), growth rates in the city
have been in excess 10% for the past three years. By contrast, national GDP
has contracted steadily through the 1990s; it fell 4% last year and is
likely to post another decline this year. Overall output, based on official
statistics, is now more than one-third smaller than in the last years of the
Soviet Union.
Karl Marx would find ample evidence in today's Russia for his contention
that economics defines politics. By an overwhelming majority Moscow voters
support reform and embrace free markets. In last year's elections, Mayor
Yuri Luzhkov, running on a strongly anticommunist platform, handily won a
new mandate in the first round.
In the rest of the country, communists are making a stunning comeback.
Right
outside the city gates, for example, voters in suburban Bolshevo returned a
communist administration to power. And communists have won a series of
recent victories in gubernatorial elections (though a reformist candidate
broke their streak on Sunday in Nizhny Novgorod, Russia's third-largest city).
Back in Moscow, the Russian Duma (parliament) provides a stark reminder of
the hostile territory that surrounds the city. Communist and nationalist
deputies have made it difficult to pass any legislation, and President Boris
Yeltsin has had to rule by decree. Opinion polls suggest that if elections
were held today, the communist faction in the Duma would only increase.
The concentration of power in Moscow breeds distrust for the central
government and its reformist ideas elsewhere in the country. Such suspicions
are warranted. Russia's government is still a major economic player, holding
substantial stakes in the country's industrial and resource-producing
companies, in utility companies and regional telecommunications concerns. It
has been aggressively selling off those stakes. Politically well-connected
financial conglomerates have been the main beneficiaries of privatization,
since they were able to snatch up companies at a fraction of market cost.
Now, the handful of newly enriched financial-industrial barons are
scrambling for political clout, since they know that those who have
political power in Russia will get a free hand to strangle their economic
competitors.
Some of those barons, in fact, have joined the government. They perform
their official duties without relinquishing their business empires; far from
worrying about conflicts of interest, they openly use their inside track to
further their business goals. It is easy to see how this political and
business axis could solidify into an all-powerful oligarchy that would
hijack Russia's nascent democracy.
What's more, there is something disquieting about the leaders of a new,
democratic Russia governing from behind the high walls of the Kremlin,
whence Stalin and Brezhnev once ruled. So why not move the capital out of
Moscow--as Peter the Great did in 1712? The reformist czar disliked Moscow
and felt that its patriarchal old ways impeded Russia's progress to
modernity. His solution was to found a new capital, St. Petersburg: modern,
airy, Western in style, in spirit and in geography. He cut a window to
Europe, to cite a Pushkin poem, and launched Russia on a 200-year trek to
Westernization.
The Bolsheviks moved the capital back to Moscow in 1918. Their aim was
self-preservation, since St. Petersburg was in danger of being overrun. But
the effect was a turn inward, an effort to build socialism in one country
and, ultimately, 70 years of isolation from the rest of the world.
Moving the capital back to St. Petersburg would symbolize Russia's embrace
of Western values. Alternatively, the capital could be moved to
Yekaterinburg in the Urals or, better still, to a small town in central
Russia. This would stress Russia's new commitment to democracy. It would be
a symbol that the government is now willing to listen to its people, not
just to issue heavy-handed decrees from a walled-in castle over Lenin's Tomb.

*********

#10
San Jose Mercury
15 July 1997
[for personal use only]
America's new NATO noose
BY PATRICK J. BUCHANAN
Patrick J. Buchanan, a former presidential candidate, is a syndicated
columnist.

LIKE Woodrow Wilson in 1919, Bill Clinton has come home from Europe with
grateful cheers ringing in his ears. For Clinton has given to Poland,
Hungary and the Czech Republic, and promised Romania, what none could have
dreamed of a few years ago: a U.S. commitment to go to war, forever, to
defend their frontiers and independence.
After Madrid, every democracy in Europe has cause to hope that a U.S.
security guarantee is in the mail. No fewer than nine former captive
nations -- Estonia, Latvia, Lithuania, Slovakia, Slovenia, Romania,
Bulgaria, Macedonia, Ukraine -- today anticipate that they, too, will soon
be under a U.S. nuclear umbrella, their security forever guaranteed.
Meanwhile, Clinton basks in glory and the near certainty that he himself
will never have to make good on those war guarantees, and America's
globalists are crowing over yet another triumph over ``isolationism.''
A modest dissent. The famous Kremlinologist George Kennan is right.
NATO's expansion to the borders of Russia will prove ``the most fateful
error of American policy in the entire post-Cold War era.'' By converting
an alliance created to defend Western Europe into an American protectorate
over Eastern Europe, we have scheduled a certain 21st century confrontation
with Moscow. A sick Russia will one day get well and declare its own Monroe
Doctrine.
Our allies are already slipping quietly out of camp. The French have
said they will provide neither men nor money for NATO expansion. Berlin is
mumbling the same. Indeed, the idea that Germany would declare war on a
nuclear-armed Russia over Poland is laughable. When the Solidarity union
was crushed in 1981, Germany would not even put Warsaw in default, out of
fear that German banks might have to write off Polish loans.
When it comes to NATO's new members, there is no doubt as to who is to
pay the cost, take the risks and do the fighting. We are today making
open-ended commitments to go to war to defend nations that are 5,000 miles
away and have not the remotest connection to U.S. vital interests -- at a
time when the U.S. defense effort is falling to pre-Pearl Harbor levels.
NATO expansion means permanent loss of our constitutional right to
decide when, where and whether to intervene in Europe. Generations as yet
unborn are being committed to go to war. If the Senate capitulates to
Clinton, the United States will be in the midst of every Bosnia of the 21st
century from the first shot. How in heaven's name is our security advanced
by such insane and endless commitments?
An early crisis is likely to come in the Baltic republics, now utterly
exposed. While Clinton has held out the prospect of NATO membership to all
three, France and Germany are opposed, and Russia has threatened to rupture
all ties to NATO if Lithuania, Latvia and Estonia are brought in.
Even if they were admitted, the United States could neither defend nor
liberate them, short of the sort of naval blockade and nuclear threat JFK
made in the Cuban missile crisis. And how do we respond if Moscow demands a
corridor to Kaliningrad, the tiny enclave wedged between Poland and
Lithuania where there are more Russian troops stationed than there are
American troops in all of Europe?
We learn nothing from history. When Germany agreed in 1918 to an
armistice on Wilson's Fourteen Points, the allies divided and dismembered
the nation, imposed huge war reparations and forced it to accept full moral
guilt for a war the kaiser had not planned, did not want and desperately
sought to avert. By imposing that humiliating peace, the West discredited
German democracy at birth and set the stage for Hitler.
By 1922, embittered Germans were secretly collaborating with Lenin.
It is happening all over again. From 1989 to 1991, the Soviet Union
turned loose all her satellites, allowed the Berlin Wall to be torn down
and Germany to be reunited, and dissolved the U.S.S.R. into 15 independent
nations, asking only that the West not move NATO into the old empire.
We gave Russia our word, and now we have broken it.
We should have brought Russia into the European Union. Instead, we are
bringing Eastern Europe into our military alliance, rubbing Russia's nose
in its Cold War defeat and driving it into the open arms of China, Iran and
Iraq, which, we may be sure, are planning their own surprises.
Triumphalism is pandemic in Washington. The Washington Post now declares
it is our duty to set about ``ensuring that no country, by virtue of size
or history, can determine another's fate.'' This is hubris of a high order,
the kind that got U.S. Marines massacred in a Lebanon, where they had no
more business than do U.S. troops in Poland or Romania.
God help the peoples of Eastern Europe. For we are today making vows to
them we will no more be able to honor, decades hence, than were Britain and
France able to honor the guarantees they gave to the nations carved out of
the German and Austrian empires in 1919. Unfortunately, there is no way now
to extricate ourselves from this folly without national humiliation or
something worse.

**********

#11
Asia Times
15 July 1997
[for personal use only]
Squabble over Caspian oilfields

A dispute has developed between Russia and Azerbaijan on the one hand
and Turkmenistan on the other following the early July signing of an
agreement by Russian and Azerbaijani oil companies to develop a disputed
oilfield in the Caspian Sea. The accord to develop the Kyapaz oilfield was
signed by the Azerbaijani state oil company SOCAR, which is to have a 50
percent stake in the project, and the Russian companies LUKoil and Rosneft,
which are to take 30 and 20 percent respectively, Russian reports said. 
After the signing, the Turkmen Foreign Ministry issued a statement
protesting against the deal on the grounds that Kyapaz belonged to
Turkmenistan. The oilfield lies roughly halfway between the Azerbaijani and
Turkmen Caspian coastlines, and just to the east of two other offshore
deposits disputed by Azerbaijan and Turkmenistan - Azeri and Chirag. 
In a statement, the Turkmen ministry demanded "that the oil accord be
scrapped in order to avoid possible consequences, for which Turkmenistan
will bear no responsibility whatsoever. 
"Turkmenistan could have welcomed such cooperation if not for the fact
that the Serdar oilfield, described in the agreement as the Kyapaz
oilfield, was included in the area to be developed jointly, because it
belongs to Turkmenistan. 
"Turkmenistan has always taken a principled and consistent stand toward
establishing an international legal order in the Caspian basin proceeding
from the new political reality, with the aim of the civilized development
of its resources and in the interests of all the littoral states," the
statement continued. 
"In this respect, Turkmenistan has always reacted positively to appeals,
including those made by Moscow, to show restraint as far as practical
operations in the Caspian Sea are concerned until its new legal status is
finalized. 
"The Russian Federation and other Caspian littoral states know very well
that Turkmenistan objects to the fact that its legal rights to such
oilfields as Kaverochkin and the 26 Baku Commissars, which have been
renamed by Baku as Chirag and Azeri, are openly ignored. The former
oilfield belongs partly to Turkmenistan whereas the latter belongs to
Turkmenistan fully. 
"As far as this issue is concerned, Turkmenistan has on many occasions
proposed a constructive dialogue to Azerbaijan and asked it to refrain from
any practical operations prior to an agreement. In this context, the
decision taken by Russia and Azerbaijan concerning the oilfield causes
bewilderment, to say the least, because it is evident that the oilfield
belongs to Turkmenistan and cannot be the subject of ambiguity." 
The Azerbaijani news agency Turan subsequently quoted Azerbaijani Deputy
Foreign Minister Khalaf Khalafov as dismissing the Turkmen protest as
"totally unjustified and unfounded". 
An Azeri official later confirmed that the field lay on the border
between the Azerbaijani and Turkmen sectors of the sea. "However, nobody
has ever clearly defined where the border between these sectors lies. Under
international maritime law, one of the main factors in determining
ownership of an oilfield is who discovered it," he said. 

*********