July 25, 1997   

This Date's Issues:   1082  •1083  1084  1085

Johnson's Russia List
#1082
25 July 1997
djohnson@cdi.org

[Note from David Johnson:
1. Gordon Hahn (Hoover Institution): Full Letter to New York
Times Responding to McFaul.
2. Jerry Hough (Duke/Brookings): Where Russia is now.
3. Elizabeth Pond: feedback.
4. Reuter: Russian economy at turning point, says Premier.
5. Argumenty i Fakty: Zyuganov Tops Poll for Russia's President 
in Year 2000.
6. Journal of Commerce editorial: Russia's new attitude.
7. UPI: Communication glitch at NATO exercise.
8. The Electronic Telegraph (UK): Alan Philps, Oil boom slips 
from Russia's grip.
9. New York Times: Sarah Koenig, True Crime, All Too True, on 
Moscow Television.
10. Reuter: Russian state handouts to farms to fall sharply.
11. Reuter: Russia applauds progress on CFE but still cautious.]

********

#1
Date: Thu, 24 Jul 1997 
From: Gordon Hahn <hahn@hoover.stanford.edu> 
Subject: New York Times Full Letter Responding to McFaul

Dear David:
I am sending along the full copy of my letter, a response to Michael
McFaul's Op-Ed of 22 July. Mike encouraged me to send it to you.

I would like to take issue with Michael McFaul's Op-Ed piece of 22 July on
the Russian opposition's weak response to the spectre of NATO enlargement.
First, be sure that if the communists or nationalists controlled the
powerful executive branch a rather stern reaction would be in the making
indeed. It is precisely because "the power the Russian Communists and other
opposition parties have accrued" - their "control (of) a majority of seats
in the Duma" - is not real power over anything but the budget that they
have been "ineffective and marginal." Second, Russia's opposition does in
fact exist, though, as Professor McFaul points out, it is weakened in its
ability to effect policymaking by the 'presidential' Russian Constitution.
This is particularly true of foreign, national security and military
policymaking. It instead uses its majority in the Duma as an inexpensive
platform for maintaining a public profile and funding its local party
organizations, hoping somehow to win a presidential election or parlay a
crisis into fashioning a compromise with Yeltsin that would bring a less
reformist government into power. Nevertheless, Communist and nationalist
opposition leaders have reacted in some ways. Rhetorically, they have
threatened various responses to NATO expansion but simply lack the
political muscle to counter the president's monopoly on foreign
policy-making. More substantively, months ago they formed an 'anti-NATO'
faction in the Duma, the largest issue-based faction in the Duma with well
over one hundred members, combining communists, nationalists and even some
so-called 'centrists'.
Third, therefore, NATO expansion puts at risk, therefore, Federal Assembly
(State Duma and Council of the Federation) ratification of the START
strategic nuclear weapons treaty among others that are in the interest of
the United States.
Fourth, the nature of the Russian opposition is such that it will for a
few more years to come be not a constructive, but an irresponsible
opposition with strong anti-Western inclinations. Therefore, the albeit
still weak trend of bringing centrists and hardliner opposition forces
closer together is the real danger of Russian decline and isolation.
Recently, moderate former Defense Minister Igor Rodionov and Duma deputy
General Lev Rokhlin have formed an organization to ostensibly 'lobby' for
the interests of the military and combat Yeltsin's proposed military
reform. One of the arguments they will use against the planned reforms is
that it is too dangerous to undertake a comprehensive reform on the
background of simultaneous NATO expansion and declining funding for the
military.
This is another predictable consequence of NATO expansion - the worsening
of already rather poor civil-military relations which are already strained
by years of weapons cuts, declining military budgets, housing shortages for
officers, six-month delays in pay checks, budget favoritism for other
Russian 'military' and police structures, and the politicization of the
officer corps these processes and intervention into two coup episodes have
produced. What is so disturbing about the appearance of the
Rodionov-Rokhlin association is the extremism of its other leaders: former
KGB Chairman and August 1991 coup-plotter Vladimir Kryuchkov, the notorious
chairman of the Soviet patriotic Union of Officers', and several other
retired generals involved in both the August 1991 coup and in the October
1993 uprising against the Yeltsin-Chernomyrdin administration. The
pressures of a disintegrating military, civilian demands for military
reform, and now NATO expansion have driven two centrist generals (Rokhlin
in fact is the third ranking member of Prime Minister Chernomyrdin's party
'Our Home is Russia') into the arms of the hardliners.
Finally, one of the reasons the Yeltsin administration has finally gotten
serious about military reform and why General Rokhlin harshly criticized
Yeltsin's military policy recently is the considerably worsened security
position of Russia that NATO expansion portends. Militaries all over the
world plan on the basis of contingencies and should do so not on the basis
of other countries' intentions but on the basis of their capabilities, as
former Secretary of State George Shultz has argued. There will be those who
will write that NATO is a purely defensive alliance, but any military
officer worth his salt will tell you that there is a fine line, in many
cases, between offensive and defensive weaponry. Though I would agree that
NATO expansion is not on the minds of the Russian 'man in the street', it
is on the minds of those in political offices, the broad political elite
and the community of Russian 'defence intellectuals'.

Gordon M. Hahn, Ph.D.
Hoover Institution
Stanford University

********

#2
Date: Thu, 24 Jul 1997 
From: "Jerry F. Hough" <jhough@acpub.duke.edu> 
Subject: Where Russia is now 

Dear David:

Once again you ask for a debate on where Russia is now. It is a 
frustrating question for the focus on the debate must is always 
truncated and the assumptions that are on the table always seem 
about two-thirds wrong--and always relate to the current political 
agenda. 
Several months ago a graduate student at Brandeis (alas, I forget 
his name) say the Communists must be understood not with contempt, but 
from a rational actor perspective. He is right. Political scientists 
need to try to get some perspective. I am well into a book on the 
democratization of the 1820s and 1830s as a cause of the American Civil 
War and hope to finish it this fall. When the institutional framework 
is not set, the parties not firm, and the politicians not experienced, 
they can make big mistakes. Even our best politicians, Clay and Van 
Buren, seem to me to have utterly blown the Texas issue and Clay blew the 
immigration one even worse. As a result, an inexperienced 
populist like Lincoln can come to power with terrible results. Yet one 
can see why, given the ill-defined institutional structure, the actors 
took the positions they did.
The Communists may be making some big mistakes too, but one 
needs to understand their position. The leaders of the old Congress 
were quite moderate men. Khasbulatov was a radical economist, Rybkin 
was leader of the Communist faction, and one could extend the list. By 
confronting Yeltsin, they allowed Yeltsin, the Russian media, and the 
American media to demonize them--to say they were stopping reform when 
they had no more power on budget, subsidies, etc. than the Duma has 
now. The lesson they learned is that which Gingrich learned--don't 
put yourself in a position to be blamed for closing down the 
government. As a result, Zyuganov went from 12 percent in December 1993 
to 24 percent in December 1995 to 43 percent in June 1996 (excluding the 
against all, Yeltsin took him 57 to 43 with 64 percent turnout). 
Nizhnii and Samara have been two of the great democratic strongholds. 
That the Communists came so close to winning them might lead 
Zyuganov to real optimism. Half the population lives in villages and 
towns with under 100,000 people. If Zyuganov can do well in his 
strongholds and as well as Communists did in Nizhni and Samara, he has it 
made. A paper that Susan Lehmann and I wrote for a conference in 
Glascow showed, among others, that religion matters. The people who were 
inclined to support him for economic reasons tended to be the older and 
middle aged, especially women. These are the most religious groups and 
the religious among the demographic group gave Zyuganov less support than 
the non-religious. The current dispute on the religion law needs to be 
understood in these terms. Zyuganov is trying to recapture his natural 
base. His problem is not that he has no hope in 2000, but that things 
may blow earlier. The Communists can bring down the regime at any time 
and have been able to do so for several years. They can bring enough 
people into the streets and the regime cannot control the streets. But 
they have feared--and with real justification--that someone in the 
military would take advantage to establish control in the name of 
anti-Communism. Lebed was not even subtle about coming to power this 
year, and surely with such a scenario.
Who knows what will happen? In the last three-four years, 
McFaul has gone from saying the centrists in the Congress under Volsky 
were good, to ideology is giving away to interests, to Zhirninovsky being 
a real threat, to ideological polarization being everything, to the 
Communists being totally black and Lebed being a savior, to the Communists
being totally insignificant and a nationalist being the only threat. 
The line changes every six months. It all reflects the current line 
among Moscow radicals at the time.
In our 1996 election poll, the pro-reform supporters of 
Yeltsin (one-third of his vote) were the most authoritarian--the most for 
abolishing the republics, for strong rule by Moscow over the regions. 
They are behind the "local self-government" position for Moscow to give 
money directly to the cities instead of just the states. I assume that 
the purpose of the current line is to set up a new demonology: one must 
support the nationalist, Moscow-centered authoritarian Luzhkov as the
only salvation for Russia. But how many new heroes and villians are 
going to arise, how often is the line going to change in the three years 
before the next election is held--maybe.
The focus of the debate should be on economic policy--on what is
"reform?" This week once again the press describes the miracle of 
China--9+ Percent growth in the first half with low inflation. Of 
course, it is a reform with an industrial policy, high tariffs, 
agricultural reform (agricultural production in Russia is to fall another 
5% this year with good weather), minimal privatization of the state 
sector, leasing of land instead of sale, and very strong regions. But we 
bribe the Russian leaders to do the opposite on all counts. 
For reasons laid out in my Democratization and Revolution in the
USSR, I think the economic performance is--and has been the predictable--
outcome, but one result is clear. We have asked one question on every 
questionnaire since 1993: "Is the West following the goal of weakening 
Russia with its economic advice?" We asked it again on a 
3800-respondent "youth" study of 17, 24, and 32 year olds funded by the 
National Council on Soviet and East European Research and the MacArthur 
Foundation.
In the national samples (3800 respondents). "yes" (combining I'm 
sure and probably) won 52.1% to 25.4% in 1993, 59.0% to 20.5% in December 
1995 and 59.4% to 21.4% in June 1996. The 24-to-32 year olds in these 
samples said "yes" 42.6% to 35.2% in 1993, 49.5% to 30.1% in 1996, and 
57.7% to 24.6% in 1997. The 17-year-olds in 1997 said "yes" 57.7% to 
23.1%, the only question on which they were less reformist that the 24-to-32 
year olds. 17 year olds in cities over 1 million people said "yes' 55% to 
33%. The 17 year olds who reporting getting almost all "fives" (A's) in 
school said "yes" 67% to 29%, the 24 to 32 year olds who got "fives"
55% to 31%.
One could get such figures into op-eds in 1993, not in 1996 and 
1997. I assume they are so terrifying that editors are afraid to 
publish them because they think Russia is so unstable an untoward article 
may tip the balance.
But I think they deserve the most serious thought. Essentially a 
decade of pushing--really bribing--the Russians to take a single reform 
line taken by no other Communist country, one totally contrary to American 
experience, has led even the Moscow youth to believe the old argument that 
an international financial conspiracy is out to get Russia. When even 
Luzhkov starts talking about "non-Russians" in the leadership, it is 
clear that Russians suspect that the old story was right about who is at the 
core of this conspiracy. At least, McFaul is right to warn obliquely that 
Nemstov is not likely to be in the runoff, but does he really think that 
the representative of Moscow financial capital is going to win against a 
populist attack from left and right? Only if he goes as far right as 
the Serbian and Croatian Communist leaders.
But now after blowing six years opportunity to try to turn the 
Communists in a social democratic direction, pious American talk about the 
need for a new social democratic party is fatuous. The best shot is to 
try to create a corporatist PRI. We need to go back to Duverger to 
understand that intellectual-based and created parties are almost never 
successful in universal-suffrage democracy. There is a need for solid 
institutional bases of democracy.
The effort to create civil society--the attack on the industrial and 
agricultural elite, the enfeeblement of the governors-- has simply atomized 
society with all the consequences Arendt and Kornhauser predicted. 
As Duverger said, parties must be based on solid elite structures. 
Financial elites dependent on government-deposited money are in a solid
position to defend themselves only if they get to their airplanes in time.
There must be solid elites who can control government. There are
two possibilities--a union of financial, industrial, and agricultural
elites in which banks are used to pour money into investment and further
take-over possibilities are ended. A Mexican kind of trade union must be
part of the corporatist structure, and the Communists could be part of 
that. But production must be increased at all costs, health turned 
around, the intellectuals paid. The right-wing in Europe knew how to do
this in the 1930s. It would be poetic justice if we now studied their
means to prevent the social policy they promoted.
Second, a decentralization of tax power to the governors so they can 
have some of the independence of the English barons or American states. 
The argument that the regions have power when they are so financially 
dependent on the government has been exploded numerous times in articles 
on this news-service, but it still survives in the continual talk about 
the regions being too strong. 
Yeltsin paradoxically remains the hope. He has cut a deal with 
us that if we will call him democratic and finance him, he can be a 
typical right-wing non-repressive authoritarian dictator. He has been 
quite pliant in doing what we want. But even he must have the fear that 
he will go down in history as a Mobutu rather than as a president of 
Singapore or China. And he should fear that he may have the same 
fate. If we told him our intelligence has evidence he will fall and 
that we agree he must reluctantly change economic policy and build a 
presidential party, there is a good chance he might do it. 
But such as NATO expansion was a taboo subject before it was too 
late, so no one wants to draw any conclusions and debate Administration 
economic policy. A Hoffmann of the Washington Post returns and says how 
terrible things are--but are the result of the old regime and how 
wonderful that Nemtsov and Chubais are now in charge. It is the line. 
People will be able to say we described all the bad consequences, we knew 
the one good policy might fail, but you know how those Russians 
are--Pipes was really right that they really are not quite civilized.
Talbott was right in 1993 when he said there is too much shock and not 
enough therapy and also Gore when he said the same thing. Gore surely 
is thinking of 2000 and should ask how Russia will look then. He is 
close to Chernomyrdin, the one major politician whom Yeltsin trusts 
because he is not a threat and because any replacement would be. If 
there cannot be an open debate in American civil society, then perhaps 
those in the state will give quiet thought to policy.
NATO enlargement in itself is not so bad (the Russians think Poles
need to controlled by someone), but the policy should be to bring Rome and
Byzantine together as Jim Baker and Talbott have essentially favored. 
It is much more dangerous to exacerbate the Orthodox-Catholic line as 
we do on the religious law and the war crime issue in Serbia. It is 
much more dangerous to feed old stereotypes about international financial 
conspiracies. If NATO expansion were combined with a presidential 
initiation to push industrial and agricultural production and to expand 
medicines and pharmaceutical investment, the Russians might decide that 
our policy is not quite as hostile as they think. 

Jerry F. Hough
James B. Duke Professor of Political Science
Duke University

***********

#3
From: Elizpond@aol.com (Elizabeth Pond)
Date: Thu, 24 Jul 1997 
Subject: feedback

Dear David, 

My method of digesting DJLists is first, to delete things I figure I won't
want to look up again (this can range from 40% to 80%); second, to file the
occasional piece that I want in my active subject files (in my case, mostly
Ukraine and NATO enlargement); third, to file (and then transfer to disk) the
rest in packets of about 425,000 bytes (that might be 15 to 20 DJLists
together). For the last I load them chronologically with contents, but also
repeat all the contents at the top of each file for easy reference, leaving
your original file and item numberings. This worked well, for example, when
I wanted to retrieve and put the Economist special section together. For the
record, I subscribe to the Economist anyway, but for quick lookups it's also
useful to have the section on my computer.
Elizabeth Pond

*********

#4
Russian economy at turning point, says Premier
By Jonathan Lynn 

MOSCOW, July 24 (Reuter) - Russia's economy, at last showing signs of
recovery, is at a turning point and poised for growth, Prime Minister Viktor
Chernomyrdin said on Thursday. 
But in a survey of economic performance this year made to the cabinet, he
said the authorities still had to untangle a web of unpaid bills between
companies and the state which were holding back growth and undermining fiscal
policy. 
``We're on the point of a breakthrough. We can raise up the Russian economy
and make it competitive and respected throughout the world. But it could work
out differently,'' he said. 
Since President Boris Yeltsin installed a new reformist cabinet in March,
Chernomyrdin said, pension arrears had been paid, inflation had fallen,
interest rates were down, capital was flowing into the country and structural
reforms were underway. 
Government forecasts at the meeting assume industrial output over the year as
a whole would not rise and could fall up to two percent. But Chernomyrdin
said output had risen in the first half, and in June was two percent higher
than a year earlier. 
``This year we note increased business activity in most sectors in
industry,'' he said. 
The recovery was also having a positive social effect, fostering the growth
of a middle class, he said, pointing to increased ownership of consumer
durables such as video players, washing machines and cars, which was spurring
Russian output. 
But some companies were still technically backward and inefficiently run, and
in a state of financial collapse. 
The amount of unpaid bills in the economy had nearly doubled to 27 percent of
gross domestic product over the first half of the year. Company profits in
real terms were 2 1/2 times lower than a year ago and companies had no
working capital, he said. 
Government revenues in the first half of the year were only 64 percent of
budgeted levels, forcing the government to slash spending to 68 percent of
budgeted levels. But tax income in the second quarter had jumped to 87
percent from 58 percent in the first. 
The government was on course to pay 20 trillion roubles of wage arrears by
the end of the year, Chernomyrdin said. 
The government was working vigorously to improve cash flow in the economy by
drawing up programmes to restructure debts, he said. 
Russia's biggest tax debtors are being forced to choose between bankruptcy
and a restructuring programme in which they transfer asset-backed bonds or
majority equity stakes to the government in trust while they pay off their
taxes, he noted. 

*********

#5
Zyuganov Tops Poll for Russia's President in Year 2000 

Argumenty i Fakty, No. 30
July 1997
[translation for personal use only]
Unattributed poll in the "Public Opinion Poll" column on who will be
next Russian President: "Who will be the President of Russia in the year
2000?"

On the threshold of a new century Russia is fated to give a meaning to
its present and its future at the country's presidential elections in the
year 2000. According to a nationwide poll (involving 6,000 respondents)
conducted to order for ARGUMENTY I FAKTY in July by the Nugzar Betaneli
Institute of Sociological Parliamentarianism, citizens' mechanism of
political self-determination has already been started up.
It was proposed to respondents that they should name the candidate
themselves to avoid any direct or indirect influence on them. The
question: Whom of the current Russian politicians and public figures would
you put forward as a candidate for president of Russia in the year 2000?" 
Twenty-six percent named their candidate for the President of Russia in the
year 2000; 32 percent did not see a worthy candidate; 42 percent found it
difficult to specify one.
Among the "candidates for President of Russia in the year 2000" put
forward by the respondents, the replies were divided up in the following
manner (as a percentage of the total number of candidates named):
G. Zyuganov -- 23.8 percent;
B. Nemtsov -- 21.8 percent;
A. Lebed -- 15.8 percent;
G. Yavlinskiy -- 10.7 percent;
Y. Luzhkov -- 5.2 percent;
V. Zhirinovskiy -- 4.4 percent;
B. Yeltsin -- 3.4 percent.
A. Tuleyev -- 2.0 percent;
A. Chubays -- 1.6 percent;
V. Chernomyrdin -- 1.4 percent;
Ye. Gaydar -- 0.7 percent;
S. Fedorov -- 05 percent.

Another 35 of the "candidates" named by the respondents collected a
total of 8.7 of the votes. Each of them was mentioned from one to six
times. Among the candidates there are B. Bryntsalov, A. Volskiy, M.
Gorbachev, B. Gromov, A. Kazannik, Ye. Lyakhova, A. Lukashenko, N.
Mikhalkov, Ye. Primakov, E. Rossel, L. Rokhlin, A. Rutskoy, N. Ryzhkov, G.
Seleznev, G. Starovoytova, B. Fedorov, I. Khamada, M. Shakkum, L.
Yakubovich, and others.
At all events, we will see many of the candidates listed in "the
people's list" in the ballot papers at the first round of the presidential
elections. We can say quite confidently that the person who will win in
the year 2000 is among them.

**********

#6
Journal of Commerce
July 25, 1997
Editorial
Russia's new attitude

The Russian government this week took a big step on the long road to 
membership in the World Trade Organization. After four years of 
standoff, it pledged to propose market-opening measures this fall to 
meet a key WTO obligation. Russia and other prospective members are 
confronted by roughly 20,000 pages of WTO rules, so a lot more will be 
required. But the pledge by Vice Minister for Trade Georgy Gabuniya is a 
welcome sign that Russia is serious about joining the world trading 
community.
Moscow first applied for membership in 1993, and, while repeatedly 
stressing the importance of membership in its external economic policy, 
has made little attempt to negotiate reasonable accession terms. Mr. 
Gebuniya's proposal, made during a WTO working party meeting in Geneva 
earlier this week, shifts the pace of the talks to fast-forward. It is 
seen by key WTO members, including the United States, as a significant 
change of attitude in Moscow.
Russia appears to have realized that, in order to lift itself from its 
economic slump, it must join the global marketplace. Membership in WTO 
will give it the cachet of sitting at the same table with the world's 
economic powerhouses and setting the rules of trade. But, far more 
important, it will bring predictability into its foreign trade.
Its exporters will know, for example, that a foreign government's 
protectionist sleight-of-hand is unlikely to make Russia's overseas 
markets evaporate. Its importers will have less reason to fear that 
crucial imported supplies would be stopped arbitrarily by a foreign 
government. WTO rules are not perfect, but they do impose on member 
governments disciplines that make trade orderly.
Under WTO rules, for example, member nations must keep their markets 
accessible, and either justify or compensate for any discrimination 
among foreign trading partners. It is this predictability that Russia 
needs in order to attract badly needed foreign investors. Without WTO 
membership it can be treated by other countries just as badly as it 
treats them.
The Russian government already has gone some way toward meeting Western 
objections to its arbitrary trade policies. For example, it has 
stiffened penalties for violation of intellectual property rights. True, 
U.S. blockbuster movies still appear in the streets of Moscow on bootleg 
video cassettes long before the films' actual release. But piracy is a 
crime under a new law enforced by special video police squads.
Yet to make its bid for WTO membership credible, Russia has to go much 
further. First of all, it must agree to a standstill, pledging not to 
impose new trade restrictions or raise existing tariffs during the 
accession talks. To make its agricultural markets more accessible -- a 
key requirement for the United States and other food-exporting countries 
-- Moscow must agree to reduce its huge farm subsidies and allow 
international monitoring. The existing subsidies distort prices on 
domestic food markets and act as a significant barrier to imports.
Moreover, Russia must agree not to replace tariffs and other 
quantitative trade restrictions with new, non-tariff barriers, such as 
onerous health and safety standards or unwarranted paperwork.
In sum, to show its determination, Moscow must make proposals that have 
commercial significance.
Russia has vast advantages over China in its bid for WTO membership. 
First, it is perceived in the West as a democracy that respects human 
rights; China is not. Just as important, it is not seen as a growing 
economic juggernaut posing a potential threat even to the United States; 
China is.
Moscow should be careful not to squander these advantages by failing to 
live up to its commitments. Empty gestures and vague promises can 
quickly dry up the good will Moscow has generated with its recent policy 
turnaround. 

*********

#7
Communication glitch at NATO exercise

REYKJAVIC, July 24 (UPI) _ Officials organizing a 17-nation NATO and 
Partnership for Peace exercise say that for the most part, the language 
barrier hasn't been a problem. 
But the director of the Icelandic Foreign Ministry's defense directorate 
acknowledges that the language barrier did lead to one hair- raising 
incident outside the Icelandic capital. 
Thordur Aegir Oskarsson (``THOR-door EGG-er OSCAR-son'') said today that 
the incident began when a Russian civilian pilot was landing his 
helicopter, which will participate in Exercise Cooperative Safeguard in 
the capital, at a base nearby. An American aviator on the ground tried 
desperately to stop the chopper pilot from landing _ because he was 
flying his craft into a hangar. 
The Russian pilot somehow made the dangerous landing, but the American 
was unnerved, to say the least. 
Oskarsson said the American told the Russian ``'You shouldn't do such 
things,' and the Russian said, 'Yes, yes, yes.'' Baffled, the American 
repeated the warning and got the same reply. 
``Finally the American asked, 'How's your mother?' and the Russian said 
'Yes, yes yes.''' 
Officials said they'd take steps to make sure such incidents aren't 
repeated. 

*********

#8
The Electronic Telegraph (UK)
July 25, 1997
[for personal use only]
Oil boom slips from Russia's grip
By Alan Philps in Baku 

THE shore of the Caspian Sea is littered with the detritus of the Soviet 
oil industry - rusting, abandoned rigs, leaking pipelines and a refinery 
that pollutes the city of Baku, capital of newly independent Azerbaijan.
It was here that the modern oil industry began in 1872, and the first 
years of the century were boom time for Baku when the wealthy families 
of the era, the Rothschilds and Nobels, invested and built handsome 
villas.
Now that the Russians have gone, a new oil boom is fast developing. It 
promises to put this region, racked by enduring ethnic conflicts, at the 
heart of Western strategic interests.
The Azerbaijan International Operating Company, a BP-led consortium of 
12 oil companies, has established its first ultra-modern rig in the 
Caspian and is hoping, after spending $1.3 billion (£780 million), to 
pump its first oil ashore in September.
But as the executives and diplomats look out at the warm waters of the 
Caspian, a nightmare still looms. What if, they ask, the Russians decide 
that they do not want the vast reserves of the Caspian - equal to three 
or four times those in the North Sea - to slip from their grip?
The Russian navy could sail towards the rigs. Moscow is still insisting 
formally that resources should be developed jointly by all coastal 
states. Such is the weakness of the Russian state, however, that the 
Kremlin has so far been forced to go along with the Western plan.
Fortune has favoured the Muslims: all the reserves are in sectors 
claimed by the Azerbaijanis - a nation akin to the Turks, though sharing 
the Shi'ite Muslim faith of Iran - and Kazakhstan and Turkmenistan, 
leaving nothing for Russia. The development of the Caspian is the 
thorniest diplomatic problem faced by the international oil industry. 
The area lies on the fault line between Christian and Muslim, fought 
over between Russia, Iran and the Ottoman Turks.
There is a patchwork of ethnic rivalries which have all erupted in war 
since the collapse of the USSR - between Armenia and Azerbaijan, between 
Georgia and the separatist Abkhaz on the Black Sea coast, and most 
devastatingly, between the Russians and the Chechens, who fought a 
21-month war which ended last summer.
"Two years ago, most people did not think this project would ever work," 
said Terry Adams, president of the AIOC. But the collapse of Russian 
imperial power has opened the way for the oil companies' gamble to come 
good. The Russians have been forced to compromise, and a deal has been 
reached at last to pump the first barrels of Caspian oil out through 
southern Russia, via Chechnya, to the Black Sea.
If the stretch of pipeline which runs through Chechnya can be repaired
in time, the first barrels will flow on Oct 1. A parallel pipeline, 
running through Georgia to a new terminal at Supsa on the Black Sea 
coast, is being established, so that neither the Russians nor the 
Chechens have a stranglehold.
But these two pipelines will not be big enough to handle the one million 
barrels a day that Azerbaijan hopes to be exporting in the early years 
of the next century. A new main export pipeline, giving it an export 
capacity of two million barrels a day - equal to Kuwait - will have to 
be built.
At this point the Turks are claiming an interest. They say it is too 
dangerous for all this oil to be shipped through the Bosphorus strait, 
which runs through the middle of Istanbul. A pipeline to southern Turkey 
- skirting the areas of Kurdish insurrection - is one possible solution.
The Russians have come up with a proposal to spite the Turks - a 
Bosphorus bypass from Burgas in Bulgaria to Alexandropolis in Greece, 
running through two fellow Orthodox Christian countries. But all this 
remains at the planning stage, depending on the attitude of the Kremlin 
and smoothing the endemic ethnic tensions.
"It is not yet clear that it is acceptable to the Russians for Caspian 
oil to be exported through a non-Russian route. If they let the 
Azerbaijanis off the hook, the Kazakhs and the Turkmen will do the 
same," said a senior international official in Baku.
"They could destabilise the political situation, or raise the issue of 
the status of the Caspian. The nightmare scenario is for them to send 
their fleet to the rigs, claiming that the Caspian is a lake and the 
resources should be jointly developed."
The man on whom all hopes lie to sort out the mess is the Azerbaijani 
president, Haydar Aliyev. He is going to Washington shortly for a visit 
that will formally signal that the West has replaced Moscow as the 
Caspian's dominant power.
This a triumph for Mr Aliyev's use of oil to bolster his country's 
struggling independence, constantly under threat from Russia and Iran. 
Just as the flag follows trade, so western capitals have been drawn to 
take an interest in Azerbaijan - in Britain's case, BP was in Baku long 
before the Foreign Office had plans to open an embassy.
To break down the Kremlin's hostility he has awarded shares in the 
Caspian to Russian oil companies, while locking in the West by giving 
shares to the Americans, every major European country and even Iran and 
Turkey. To get the Russians to accept their loss of empire, Washington 
has been able to offer millions of dollars in loans from the World Bank.

*********

#9
New York Times
July 24, 1997
[for personal use only]
True Crime, All Too True, on Moscow Television
By SARAH KOENIG

MOSCOW -- During a recent Friday rush hour, two Georgian men were shot in
the head in a courtyard off central Moscow's main highway, a short walk from
the U.S. Embassy. After a sudden burst of rain, the rivulets of blood that
had been creeping toward the neighbors gathered on the sidewalk turned into
blood-red puddles at their feet. 
"I'm ready to go home and have tea with lemon," said Dmitri Volgin, a
25-year-old cameraman for "Road Patrol," Russia's most lurid true crime
television show, as he finished filming the scene. Since beginning his
12-hour shift at 10 that morning, he had covered a rape case north of the
city and the fatal stabbing of a man in the far south. Even though the
gangland-style hit was sure to lead that night's edition of the popular
10-minute show, he was tired and bored. 
Within a half hour, some of the true crime competition had arrived. The
reporters stood in a group, smoking and gossiping. The price of watermelon
at a nearby fruit stand ($4 a pound) garnered more attention than the giant
automatic pistol and silencer turned up by the police officers' German
shepherd in the grassy courtyard. These resilient young journalists are
Russian television's cop-show vanguard, the on-camera result of a society
both besieged by rising crime and obsessed with it. 
"A painful barrier has been crossed," Oleg Sidorov, an editor at TV Park
magazine, said of Russia's multiplying crime programs. "A contract killing
here is no longer an event, it's a given, like snow falling." 
On any weekday, Russian viewers can choose among at least six crime
shows, usually no longer than 10 minutes each. The most popular shows,
TV-6's "Road Patrol" and Independent Television's "Kriminal," are repeated
several times a day. Weekends are reserved for longer specials, like the
widely viewed "Catastrophes of the Week." 
The shows are gritty and shocking by American standards. "Road Patrol,"
which attracts 20 percent of Moscow viewers for its morning program, is a
daily chronicle of the capital's car accidents, holdups, drug busts and
murders. Each segment is capped by a shot of the Road Patrol Volvo speeding
away from the scene, siren blaring. 
Genuine film shot by the police gives the best of the Russian programs a
quality of television-verite rarely seen on American screens, which favor
gentler, pro-police re-enactments like "Rescue 911" or "America's Most Wanted." 
"At a psychological and social level, American audiences are trained to
tune in for entertainment," explained John Langley, executive producer of
"Cops," which uses only real film. "That usually means a clean beginning,
middle and end." 
The rise in crime journalism here has echoed, and perhaps fed, citizens'
real or imagined fears. A poll by the All-Russian Center for the Study of
Public Opinion found that 31 percent of respondents in 1991 said that they
worried most about rising crime. This year, 59 percent of respondents rated
crime as their biggest worry. 
"Our society is to a large degree in a state of anxiety," explained
Sergei Agrachev, a psychoanalyst. "That anxiety really comes from the
destruction of the state that we lived in. But this anxiety must be
explained in some way. 
"Before, people were frightened of atomic war, and that was actually
justified to some degree. Now, our people have come to be afraid of crime.
These terrible scenes on TV allow people to say, 'My fear is understandable.' " 
The specialty of "Road Patrol" seems to be unabridged gore. Though the
show's stated purpose is to teach people how to avoid becoming victims, the
casual viewer is impressed less by the intended lesson than by repeated
close-ups of mangled corpses. 
Andrei Chereshnyev, the producer, has only one, self-imposed editing
rule. "Sometimes children are killed in a fire or car accident -- we try to
avoid showing that," he said. 
By contrast, the executive producer of American television's "Rescue
911," Arnold Shapiro, said his show was careful about violence involving
parents. "We were the No. 1 show on all of CBS for kids," he said. "We would
never show a rape or an attack on a mother, because we knew kids were
watching." 
When "Road Patrol" first appeared two years ago, there was nothing like
it on television; now the niche is getting crowded. "Until perestroika,
there were murders, but they weren't shown," said Viktor Biryukov, producer
of "Petrovka 38," Russian television's only pro-police crime show, named for
the notorious address of the Interior Ministry. "An illusion was created of
a happy, successful society. Now journalists are making up for all they
couldn't say and show for all those years." 
But some say the excesses of a newly free press simply stir panic in an
already spooked society. "These programs not only scare people, they create
an atmosphere of fear, insecurity and helplessness," said Lt. Vitaly Kiiko
of OMON, the Interior Ministry's special riot police unit. "Corpse, corpse,
corpse. How about the last four months, when the Moscow Interior Ministry
solved 420 out of 500 murders? But there is none of that. And people are
entranced." 
American "reality" shows like "Cops" and "Rescue 911" have an obvious
crime-doesn't-pay attitude and "boost the prestige of the law-enforcement
bodies," Biryukov said, notions that are in scant supply on Russian television. 
Both American programs have run on Russian television. Though popular,
their civic bent is alien. "For cop shows, Russian and American audiences
are as different as the sky and earth," said Biryukov, whose studio produced
local inserts for "Rescue 911" once a month until they proved too expensive. 
"If one of our shows had a whole 10-minute segment on an old lady whose
favorite kitty gets stuck in a tree, and a whole brigade of police come to
save it, our audience would never believe it. They'd sooner believe that the
police would spit in the face of that old lady, and tell her to go climb the
tree herself." 
Besides "Petrovka 38," which features soporific reports on officers being
awarded medals for bravery, Russia's true crime shows, if not openly
antipolice, are at the very least ambivalent. A recent theft report on
"Kriminal" ended with: "Now all the victims can do is wait for the police to
solve the crime. True, hope for that is weak." 
The Russian television talk show "National Interest" devoted a recent
program to the touchy issue of Russian crime reporting. 
"Right now in literature and the press there exists the problem of who is
a national hero," said Elena Nekrasova, a sociologist who studies
criminology. "In America, journalists make heroes of the cops. Here, the
heroes are often mafiosi. The strongest force in Russia is business,
criminal business. But I think it's very important to show that criminal
business is not as strong as the force that fights against it." 
If "Kriminal" is a condensed version of its parent show, the respected
news program "Sevodnya" ("Today") on Independent Television, "Vremechko," is
the network's ironic, smart-alecky teen-ager. Though not strictly a crime
show, the segments about crime are sometimes outrageous, like a recent
report on a cannibal and his mother who tortured and ate teen-age girls. 
That graphic, horrifying episode caught the attention of Biryukov, who
coincidentally also runs the Interior Ministry's information department.
When a particularly unsavory picture is shown on television, it is his job
to inform his competitors that they must tone it down or lose the
cooperation of the police. 
But most crime shows evidently have a fairly friendly relationship with
the authorities, since their shows post "wanteds" for fugitives. "Road
Patrol" reporters said they often helped forensic experts at night by
shining their powerful camera light on the bodies and once brought a
criminal to the police station in the trunk of the "Road Patrol" car when
the police vehicle didn't have enough room. 
And the program's phone number, emblazoned on the "Road Patrol" car,
along with ads for Clifford and Excalibur American alarm systems, is so
widely known in Moscow that people often dial it rather than call the police. 
Nevertheless, said Kiiko, Russia's police want more help from crime
shows, hoping perhaps television can bridge the abyss of distrust between
citizens and officers. "The American attitude to crime is, 'What can we do
to prevent this happening again?' Here, the attitude is, 'Let someone else
deal with it.' We don't yet have a civil society. The Reds destroyed that
over 74 years ago." 

*********** 

#10
Russian state handouts to farms to fall sharply

MOSCOW, July 24 (Reuter) - The Russian government, tired of pouring money
into the troubled agricultural sector, will drastically cut funding to farms
next year, a senior Finance Ministry official said on Thursday. 
Deputy Finance Minister Vasily Kovalyov, quoted by Interfax news agency, said
the budget would allot only 2.7 trillion roubles ($470 million) to farms, a
fraction of the 16.1 trillion roubles originally budgeted, but later cut, for
this year. 
The projected lower handout is a sign that officials take seriously the task
of a realistic budget, as well as a warning to the inefficient and largely
unreformed farm sector to seek alternative sources of financing. 
"We don't want to make empty promises and will strive to fulfil all the
financial plans, and to do this, we need a realistic budget," Kovalyov said. 
Interfax said only 6.5 trillion roubles, or 40 percent of the 1997 budgeted
total, would actually be handed out to farms this year. 
Russia's reformist cabinet has slashed spending plans, including to the
cost-draining agricultural sector, to keep economic reforms on track. 
Multi-billion dollar handouts to farms comprised a significant chunk of gross
domestic product in the Soviet era. 
Decreased state support may affect agricultural output, since farms cannot
afford bank credits and banks are unwilling to lend to a sector in which most
enterprises are in a state of collapse. 
Russian grain output has contracted by 40 percent this decade alone, and
around half of the country's food needs are now met by imports. 

**********

#11
Russia applauds progress on CFE but still cautious

MOSCOW, July 24 (Reuter) - Russia said on Thursday it was generally satisfied
with a 30-nation interim agreement on revising a treaty limiting conventional
weapons in Europe. 
But it also said plenty of work remained to be done before a final agreement
was reached, despite Wednesday's breakthrough in Vienna at negotiations on
the 1990 Conventional Forces in Europe (CFE) treaty. 
``Agreement on an intermediate accord is a common success and evidence of the
serious intentions of all the countries participating in the Vienna talks,''
Foreign Ministry spokesman Gennady Tarasov told a news briefing. 
``The intermediate agreement on a balanced basis satisfies us in general.'' 
He said some important differences remained to be solved, including over the
deployment of NATO forces on the territory of prospective new members of the
alliance. 
This was a clear reference to frmer Warsaw Pact members states who might join
NATO. Poland, Hungary and The Czech Republic have already been invited to
join. 
``We will work energetically jointly with other countries participating in
the treaty on the remaining very important problems, while bearing in mind
the principle that nothing has been agreed until everything has been
agreed,'' he said. 
The CFE treaty limits the number of tanks, artillery pieces, aircraft and
other non-nuclear arms the states can hold. 
Russia wants the overall ceilings set in 1990 revised because of political
changes since then, including the collapse of the Soviet Union and the
dissolution of the Warsaw Pact. 
Under the new deal, the old idea of a balance between NATO and Warsaw Pact
members will be replaced by a structure of individual national arms limits,
coupled with ``territorial ceilings,'' which determine the areas where
national and stationed equipment will be allowed. 
All states have also agreed not to increase their current arms levels in
Europe, and Russia has said it may consider lowering its national limit to
its current arms levels. 

********