April 8, 1998  
This Date's Issues: 2139• 2140 • 

Johnson's Russia List
#2140
8 April 1998
davidjohnson@erols.com

[Note from David Johnson:
1. AP: Communists Oppose Russia PM Nominee.
2. RIA Novosti: THE COMMUNIST FACTION FAVOURS AN OPEN VOTE IN THE 
STATE DUMA ON THE CANDIDACY OF SERGEI KIRIYENKO.
3. Interfax: Duma Deputy Says Foreign Money Is Used To Make Kiriyenko PM.
4. Fred Weir on labor protest. 
5. Floriana Fossato (RFE/RL): Russia: Trade Unions Prepare For Protests.
6. Walter Clemens: New Book.
7. Stefan Gheorghiu: Stuart Loory's WWW Conference.
8. Moscow Tribune: John Helmer, Uncle Sam starts to panic.
9. Obshchaya Gazeta: Vladimir Petukhov, ELECTORATE WITHDRAWS INTO ITSELF.
10. Los Angeles Times: Jim Mann, Clinton's Call-Boris Policy Still Vital
but Has Its Limits.
11. RIA Novosti: BABURIN: EUROPEAN SECURITY ARCHITECTURE WILL BE 
STABLE WITHOUT EASTWARD EXPANSION.
12. Moscow Times: Igor Gamayunov, ESSAY: Tax Police Reveal Shady Side of
Power, 
Money.
13. Reuters: Key points of Russian PM's draft programme.
14. RFE/RL NEWSLINE: NEW LAW ON MILITARY SERVICE GOES INTO FORCE.
15. Interfax: Chubays Comments on Election to UES Board.] 

********

#1
Communists Oppose Russia PM Nominee 
By Vladimir Isachenkov
April 8, 1998

MOSCOW (AP) -- Communists in Russia's parliament remain stiffly opposed to
Boris Yeltsin's nominee for prime minister, and a top presidential aide
conceded Wednesday that a quick confirmation is unlikely. 
A government spokesman, meanwhile, warned that foot-dragging on choosing
a premier is hurting the country. Igor Shabdurasulov said it had stalled
talks with the International Monetary Fund and delayed wage payments, the
ITAR-Tass news agency reported. 
The State Duma, Russia's opposition-controlled lower house of
parliament, is scheduled to hold a confirmation vote on acting Prime
Minister Sergei Kiriyenko's nomination Friday. 
Yeltsin's opponents indicated they would continue to hold up the
confirmation. 
``Kiriyenko's confirmation would be a threat to Russia's national
security,'' Communist leader Gennady Zyuganov told a news conference
Wednesday. He said the 35-year-old Kiriyenko is too young and inexperienced
and that the Communists and their allies would reject him in Friday's vote. 
``Mr. Yeltsin is pushing for the confirmation of a premier who would be
incapable of setting an independent course, thus moving (Russia) deeper
into crisis and chaos,'' Zyuganov said. 
He said his party would challenge Yeltsin in the Constitutional Court if
he tries to propose the little-known, former oil minister again. 
Under Russian law, Yeltsin must dissolve parliament and call early
elections if the Duma rejects his nominee three times. The constitution
appears to let the president offer the same choice if he wants; Zyuganov,
however, claims Yeltsin must propose at least two candidates. 
Alexander Kotenkov, the president's liaison with the Duma, said
Kiriyenko has ``almost no chance'' of winning confirmation this week,
because opposition lawmakers would seek to delay the process to bargain for
concessions. 
His remarks were the first indication from the Kremlin that Kiriyenko
might not be confirmed on the first run. But Kotenkov suggested Kiriyenko
could then be confirmed on a later vote. 


``It's not because deputies don't like his candidacy. It's simply that
political trading will take place,'' ITAR-Tass quoted Kotenkov as saying. 
Zyuganov on Wednesday accused the Kremlin of deliberately choosing a
candidate who could not be confirmed in order to disband the parliament. 
Russia's current political crisis began last month when Yeltsin abruptly
dismissed the Cabinet of former prime minister Viktor Chernomyrdin, blaming
it for stalled economic reforms. 

********

#2
THE COMMUNIST FACTION FAVOURS AN OPEN VOTE IN THE STATE 
DUMA ON THE CANDIDACY OF SERGEI KIRIYENKO
MOSCOW, APRIL 8, 1998 /FROM RIA NOVOSTI CORRESPONDENT
ALEXANDRA UTKINA/ -- The Duma's communist faction intends to
propose an amendment to the Regulations on the State Duma that
would make it possible to take an open vote on the candidacy of
Sergei Kiriyenko for the post of Prime Minister, KPRF leader
Gennady Zyuganov announced at today's press conference.
"This needs to be done to preclude the possibility of
calling into question the respectability of deputies," he said.
Moreover, according to him, the KPRF faction is out to propose
that deputies of the State Duma should approach the
Constitutional Court with the request to tell them how many
times the President may nominate the same candidacy for approval
by Parliament. Answering journalists' questions, the KPRF leader
expressed his doubts about the possibility of Boris Yeltsin
personally presenting the candidacy of Sergei Kiriyenko to the
State Duma, although, as Zyuganov thinks, the head of state is
under the obligation to do so.
Zyuganov insisted again on the setting up of some sort of
"working group" that would draw up within the next two weeks a
"national programme for overcoming the crisis in this country."
According to him, it could comprise representatives of both
houses of the Parliament, leaders of the Duma's factions and the
major political quarters in society. He reiterated his negative
assessment of the candidacy of Kiriyenko, saying that the
government should be led by an "authoritative person enjoying
extensive popular trust."
The KPRF leader told reporters of his vision of the
possible development of events in the country. In the near
future, he thinks, "the State Duma's dissolution will be
provoked, and an attempt made to hold early Presidential
elections level with Parliamentary elections in 1999 to try and
have the President elected for a third term."
Answering questions, Zyuganov announced that after a
discussion on the candidacy of Kiriyenko, Communists will
consider the proposal of Lev Rokhlin and Viktor Ilyukhin on
preparations for impeachment of the President. "We have long
since proposed that he should resign of his own free will," he
said.
First Secretary of the Moscow City KPRF Committee Alexander
Kuvayev, who also addressed the press conference, said that
tomorrow's protest action by the left-wing opposition will have
as mottos: "Yeltsin Must Resign," and "For a Government Enjoying
Popular Trust." He expressed regrets over the fact that the
Moscow trade unions refused from acting joint with the


opposition and accused them of pursuing a policy of class
collaboration with the authorities.

********

#3
Duma Deputy Says Foreign Money Is Used To Make Kiriyenko PM 

MOSCOW, April 8 (Interfax) - *Viktor Ilyukhin*, chairman of the Duma
Security Committee and the Communist Party representative said that
according to his sources financial circles abroad made "huge currency
allocations" towards approving Sergei Kiriyenko for the post of prime
minister. 
The funds were transferred to trusted people who "are to buy votes of
the deputies," Ilyukhin said at a plenary meeting Wednesday. Ilyukhin said
he did not doubt honesty and integrity of most of his colleagues. However,
the Regulations Committee should be charged with preparing recommendations
"to ensure that the voting on Kiriyenko's candidacy is objective and free,"
he said. Temporary changes should be made in the procedure to vote openly
on this issue, he said. 
Representatives of the left radical wing of the Communist faction Igor
Bratischev, Vasily Shandybin and Kazbek Tsiku supported this proposal. 

********
#4
From: fweir.ncade@rex.iasnet.ru
Date: Wed, 08 Apr 1998
For the Hindustan Times
From: Fred Weir in Moscow

MOSCOW (HT April 8) -- Millions of Russian workers are
expected to hit the streets Thursday in protest over the growing
mountain of upaid wages, missed pension payments and unfulfilled
promises of economic reform.
"At least 10-million workers from across Russia will take
part in the demonstrations," says Gennady Khodokov, press
spokesman for the 50-million member Russian Federation of
Independent Trade Unions, which organized the protest.
"Russian workers in the public sector and many industries go
without income for months at a time, and the problem is getting
worse," he says. "No one in government seems to care about this,
so we are warning them through these peaceful protests".
The problem of wage arrears in Russia is chronic, but seems
to have hit its worst point in recent months. The total debt now
stands at 58-billion roubles (just under $10-billion), of which
about 15 per cent is owed directly by the Russian government.
Some economically-blighted regions in Siberia and Central
Russia have seen an upsurge of wildcat strikes and desperate
actions -- such as blockading railroads and occupying government
buildings -- by impoverished workers in recent months.
"Reforms were supposed to improve the life of people, not
destroy their jobs and take away their livlihood," says Mr.
Khodokov.
"Russian workers have been very patient and mostly peaceful
until now, but this cannot last forever."
The strikes will hit at a delicate political moment, as the
Kremlin struggles to restore confidence after President Boris
Yeltsin fired his entire government two weeks ago.
The State Duma, Russia's lower house of parliament, is due
to consider Mr. Yeltsin's nominee for prime minister on Friday.
The 35-year old PM-designate, Sergei Kiriyenko, has been
criticized by the powerful Communists as a political novice who
lacks experience and credibility.


A strong showing by trade unions Thursday could strengthen
opposition demands for a coalition government -- including
Communists and trade union representatives -- to take Russia out
of its economic crisis.
"There isn't any government in Russia just now, which makes
it difficult to guage the effect of Thursday's labour protests,"
says Nikolai Petrov, an analyst with the Carnegie Endowment in
Moscow.
"But tension over unpaid wages is running high in some
regions of the country, and there could be trouble."

********

#5
Russia: Trade Unions Prepare For Protests
By Floriana Fossato

Moscow, 8 April 1998 (RFE/RL) -- In Soviet times, a popular joke expressing
the sentiment of workers to their symbolic salaries was: "the state
pretends to pay us and we pretend to work." Everybody's paycheck was tiny,
and the really important thing was the extent of the perks (perquisites)
coming with one's position. The difference in salary between factory
workers and Central Committee members was not remarkable, but the
difference in perks was incommensurable. In post-communist Russia, the
joke, at least as far trade union and opposition leaders are concerned,
could be: "the state pretends to be trying to solve the payment crisis, and
we pretend to protest its failure." 

This reflects the frustration and the desperation of the thousands of
underemployed and unpaid workers across Russia. Not to mention pensioners,
who, as many cynically say, have become simply "not needed" in a country
where frail political institutions still deprive the dispossessed of a
voice able to influence civic action. 

Mounting wage and pension arrears may have been the formal justification
used by Russia's President Boris Yeltsin when he sacked Prime Minister
Viktor Chernomyrdin and his entire government March 23. However, on the eve
of tomorrow's nationwide day of protest, the feeling is that trade union
leaders are showing a remarkable understanding of the Kremlin's effort to
settle the wages crisis, and, despite declarations, seem less sensitive to
the frustration of thousands of desperate workers throughout the country. 

Workers' rallies in front of administrative offices and in factories have
become a tradition in Russia in two different periods of the year, March
and November. But previous rallies, as well as vociferous parliamentary
battles with declarative slogans "for the good of the people" have showed
the trade union and Communist leaders' conspicuous lack of real political
muscle. 

As one Communist parliamentary deputy admitted recently in corridor
conversations, while criticizing the Party's leadership, "in the morning we
come here, threaten to vote again this and that, saying that we want to
protect people's interest, and, after our protest, we leave the building to
have lunch in a nice restaurant in downtown Moscow. No result, of course,
but we look like doing our job in front of TV cameras." 
Last March, trade union leaders promised on the eve of a national protest
day that they would bring as many as 20-million workers to the streets. The
number of protesters fell far short of that, and showed the political
weakness of the leaders and their inability -- but, many called it
unwillingness -- to create effective collective action. Spontaneous
rallies, led by outraged women and enraged workers, outnumbered the
official trade union meetings. 
Russian media today criticized the trade unions. The majority of articles
on tomorrow's protest note that Mikhail Shamakov, the head of the
Federation of Independent Trade Unions has announced he supports Sergei
Kiriyenko's nomination for prime minister - the nomination that Communists
leaders have called unacceptable, even following yesterday's Kremlin
roundtable to discuss the nomination. 



Yeltsin agreed to the round-table last week, during a meeting with
parliamentary leaders, and most observers said the meeting was more a
"face-saving exercise," particularly for the Communist and
nationalist-dominated State Duma, furious of not having been consulted
before the government reshuffle. 

Shmakov, who has met Kiriyenko twice in the last two weeks, noted that
Kiriyenko has discussed the problem of wage arrears with union leaders, and
has instructed the Finance Ministry to allocate to regional governments the
money to pay debts to state employees in time to reach unpaid workers by
tomorrow. 

Kiriyenko, obviously aware the nationwide protest could influence the
parliamentary vote scheduled Friday on his nomination, said, without
elaborating, the government had found funds to settle wage arrears. He
added that the government's work "will not end April 9," and said plans on
financial support for coal miners and settling government debts to the
defense industry would soon be completed. 

Shmakov, speaking yesterday at a meeting between trade union and business
leaders, said that 80 percent of estimated wage arrears are owed by
employers rather than by the government. Despite Shamakov's conciliatory
tone, about three thousand unpaid defense industry workers and
representatives of defense industry trade unions yesterday picketed
government headquarters. They waved signs and banners, including slogans
saying that "those who destroyed the country must answer for it," and "our
patience is at an end." 

Yuri Stichenok, the protest organizer, said, "it is not just that the
non-payment situation hasn't gotten better in the past year. It has gotten
worse." Some of the protesters advanced political demands, and repeated
calls for the government to meet its financial obligations toward the
deteriorating defense industry. 

Acting Deputy Prime Minister Yakov Urinson, met the protest leaders, and
told them the government has appropriated funds in the new federal budget
to pay the arrears. In February, officials pledged that this year the
government will pay about $1.7 billion it owes to defense enterprises. 

According to the state Statistic Committee, wage arrears in the ten main
sectors of the economy, at the beginning of March, reached more than $9
billion. And, Pension Fund Chairman Vasily Barchuk said last week that
pension arrears totaled about $130 million as of April 1. He said payments
have been delayed in 30 Russian regions. Barchuk said contributions to the
Pension Fund fell sharply in the first months of this years. He attributed
the decline in part to a Constitutional Court decision, striking down an
article of the Civil Code, requiring employers to pay wages before taxes. 
So, who is to be blamed? The heritage of the Soviet past, the government,
the employers, or, as ultra-nationalists put it, an "international
conspiracy against Russia?" 
Valentina Burkova is a former engineer who left her job at a defense plant
following repeated delays in her meager wages. Now, she works as manager of
a newsstand. "I think I was lucky to find this unqualified job. And, I
think that, as far as the salaries and pensions are concerned, all our
politicians, show us only one thing: they are all thieves and they just
don't care, otherwise they would have tried to set up a social network to
help workers in useless industries to requalify." According to Burkova,
"People, especially in the regions, will protest tomorrow out of
frustration, understanding that protest brings almost nothing in this
situation. But we all understand that rallies serve mainly as a reminder of
our existence, otherwise, politicians will simply forget about workers
altogether." 



**********

#6
Date: Tue, 7 Apr 1998
From: Walter Clemens <wclemens@bu.edu>
Subject: New Book

Walter Clemens has written a new book: Dynamics of International
Relations: Conflict and Mutual Gain in an Era of Global Interdependence
(Lanham MD: Rowman & Littlefield, 1998). It has many chapters that deal
with the USSR and post-Soviet Russia. One is entitled "Transitions: Can
the Second World Join the First?" It presents a case study of how the
transitions in Russia, Kazakstan, and China impact on their common quest
for oil in regions filled with ethnic turbulence. Another chapter on
"Foreign Policy Decision Making" seeks to synthesize the recent
revelations on the Cuban missile crisis. 

*********

#7
Date: Wed, 8 Apr 1998 
From: Stefan Gheorghiu <c671733@showme.missouri.edu>
Subject: Stuart Loory's WWW Conference

Mr. Johnson,
Could you please post this announcement on JRL on behalf of Stuart Loory?

The School of Journalism at the University of Missouri Columbia is hosting
a WWW Conference on the increasing corporate control of the news business
all over the world. 

There will be an Open Chat held at the Conference Site on Thursday,
April 9, at 11 A.M. CST, that is 17:00 GMT. We invite all of you who are
interested in the future of news business to attend.

The address is http://www.missouri.edu/~jwebconf/

We are looking forward to chatting with you.
Sincerely,
Stuart Loory, Lee Hills Chair of Free Press Studies, University of
Missouri - Columbia 
Stefan Gheorghiu, Webmaster
jwebconf@showme.missouri.edu

*********

#8
Moscow Tribune
March 8, 1998
Uncle Sam starts to panic 
By John Helmer 

Among the thousands of stories hatched in Moscow to make sense of President
Boris Yeltsin's recent behavior, there is one that doesn't make any more
sense than the rest. Of Yeltsin, that is. But about Vice President Albert
Gore and American policy towards Russia, it cuts embarrassingly close to
the bone. 

The story is that when former Prime Minister Victor Chernomyrdin was in
Washington a month ago, he and Vice President Gore made a private pact. If
Chernomyrdin got the Duma to ratify languishing nuclear arms reduction
treaty, START-II, restore the Khoreiver oil deposit license to Exxon and a
few other things of importance to Washington, Gore would make sure
Chernomyrdin had American backing for Russia's next presidential election. 

For the record, US officials say this "lacks credibility," adding that the
United States won't make up its mind until after the Russian Constitutional
Court rules on the legality of another term for Yeltsin. 

But this doesn't mean the report isn't true on several crucial points. The
most obvious is that, having viewed Yeltsin's condition close up --
remember Houston surgeon Michael DeBakey got right inside the old man's
heart cavity -- the US government thinks Yeltsin's physical powers are
failing quickly, and his political ones have to be replaced, the sooner the
safer. 
When normal people face the reality of terminal heart failure, many suffer
paranoid delusions. They imagine people are plotting to kill them --
doctors, cooks, family members who are heirs, etc. When politicians face
the same reality, the paranoia is the same but the delusions are more
dangerous. To neutralize this danger in Yeltsin is what Gore thought he and
Chernomyrdin could achieve -- and at the same time help smooth each other's
road to their respective presidential elections. 


If Yeltsin learned of this, it's not surprising he imagined the Americans
were plotting against him. How often and how similarly, he must have
remembered, had he plotted with Washington to get rid of Mikhail Gorbachev? 

What Yeltsin did next was also a page from an old book: he dumped
Chernomyrdin the way he and the Americans thought of dumping parliament in
Yegor Gaidar's time in March 1993. 

Only, wait a minute... the emergency rule decree that Yeltsin thought up to
save himself and Gaidar was pulled back at the last minute. This time,
Yeltsin was on air before he knew what the next step would be. 

And that's just one more symptom of the problem Gore and the Washington
establishment have with Yeltsin now. They know his time is running out.
They've decided -- this, not Chernomyrdin's ambition, is the real
significance of the Gore-Chernomyrdin pact -- that the route to a stable
succession that safeguards American interests cannot be a third Yeltsin
presidential term. There are just too many people who know how
incapacitated the president is and too many hostile, corrupt or
unpredictable interests capable of seizing the advantage. 

The Americans have another problem, too. The Germans. They also had their
doctors watching the Yeltsin bypass surgery in November 1996. When Yeltsin
can't remember Chancellor Helmut Kohl's first name, nobody knows better
than the chancellor how bad the situation has become. The Germans view
Chernomyrdin as the Americans' man. They have been systematic about probing
the alternatives -- Grigory Yavlinsky, Aleksander Lebed, Yury Luzhkov. And
the Americans know what the Germans have been doing.
So what's to be done? Not an election, that's for sure. The Americans and
the Germans understand that if the fight over the Kiriyenko nomination
prods the Communists into acting ideologically correctly (a first for
them), an election could be forced. 
To prevent that from becoming a massacre by the left wing would cost
Clinton and Kohl several billion dollars more than they paid out in 1996.
And, without Anatoly Chubais managing the cash box, they aren't as
confident this time that the money wouldn't be ripped off straight to
Switzerland. 

Managing greed and desperation among the underlings is now as difficult as
managing Yeltsin at the top. Sergei Kiriyenko isn't cut out for that. 

The tough men who remain around Yeltsin, goodfellas like Sergei Shakhrai
and Pavel Borodin, have a very small span of control and are greedy
themselves. 
Valentin Yumashev and Sergei Yastrzhembsky are ciphers. The vital job of
protecting Yeltsin and the regime from crackpots and from the surly,
rebellious army has also passed out of competently ruthless hands. 

The best generals Russia has today are in opposition, active or passive;
Yeltsin can't easily or reliably summon them to his aid. 

This is what is known in Washington and Bonn as a vacuum. And human nature
abhors a vacuum. Gore thought he was doing Russia, the American interest,
even Yeltsin, a good turn. Now look what's happened. Say it ain't so, Al. 

********



#9
>From RIA Novosti
Obshchaya Gazeta, No. 12
April 1998
ELECTORATE WITHDRAWS INTO ITSELF
By Vladimir PETUKHOV, Russian Independent 
Institute of Social and Ethnic Problems

The political choice of society depends not so much on
the situation (in the economy, in the legal system, and one's
life), as on the mood. Social scientists know that the mood in
society is not a direct reflection of the results of
socio-economic and political realities. The relation between
them is much more complicated. We should remember this when we
try to forecast the behaviour of the electorate during the
forthcoming presidential election campaign. 
Major changes took place in social conscience in the past
few years. They can be judged on the results of monitoring
studies carried out by the Russian Independent Institute of
Social and Ethnic Problems.
First, in the first post-perestroika years (1992-96) the
bulk of the population felt constant social discomfort, but
this mood changed in 1997. The share of those who assess the
situation in the country as "normal" reached the maximum of
16%. The figure was 3% in 1992, 6% in 1995, and 11% in 1996.
At the same time, the number of those who regard the situation
as "critical, catastrophic" dropped to 33%. Before 1997, the
figure was 55-60%, although the bulk of Russian citizens did
not see any positive changes in their life. For 74% of the
respondents, 1997 was a difficult year.
So, why the positive evaluation of the past year? It may
seem paradoxical, but the loss of illusions about one's social
situation and prospects became well-nigh the main stabilising
factor. Society regards the current social reality as not
something temporary, but as a lasting thing to which one must
adjust in any way possible. This adjustment is organic for 
only 15-17% of the respondents, while the bulk regard it as a
simple adaptation to realities through the lowering of their
demands. One proof of this is the fact that over 70% of the
respondents assess their living standards as "good" and
"satisfactory," or at least do not regard them as critical,
despite the worsening of their material situation. 
Second, the nature of relations between the state and
society changed in the past few years. The people no longer
pin their hopes on the state and have switched to an
"autonomous" mode of living. No wonder their expectations for
themselves and their families in 1998 are much more optimistic
than their expectations for the state as a whole. 
Despite a relatively high level of dissatisfied with the
work of the authorities, the number of the dissatisfied is
dwindling. Some three or four years ago, society was split
into fierce opponents and rabid supporters of the political
regime which developed after 1991, but their number went down
to 15-20% and 10-15%, respectively, in 1997. The bulk of the
population are indifferent to what the authorities do. 
On the other hand, dissatisfaction is broken up into
segments and shifted to socio-political institutions -
parties, trade unions, the mass media, and the church. 
And third, the main value for the overwhelming majority


of the respondents (84%) is their "own interests and the
interests of their family." Only 15% place "social interests"
above everything else. This relation can be interpreted in two
ways. On the one hand, the public attitudes are becoming more
pragmatic, the people are overcoming their
collectivist-paternalist thinking. On the other hand, the
sense of being a citizen of one's country, the feeling of
involvement in the affairs of the state are going down, and
more people come to think that nothing depends on them.
What will happen next? The most probable scenario for the
near future is that social alienation will continue to
develop, with the gap between the "advanced" minority and
degrading majority growing ever larger. This does not threaten
major cataclysms, but leaves little hope for normal, rather
than another "history-making" elections in 2000.

********

#10
Los Angeles Times
April 8, 1998 
[for personal use only]
INTERNATIONAL OUTLOOK 
Clinton's Call-Boris Policy Still Vital but Has Its Limits 
By JIM MANN

WASHINGTON--One of the first things Bill Clinton did when he returned from
Africa to work in the Oval Office on Monday was to phone his old friend
Boris N. Yeltsin. 
It must have been quite a schmooze, a toast to old times by two
inveterate campaigners. There was lots to talk about. Over the last couple
of weeks, Clinton has celebrated the dismissal of the Paula Corbin Jones
case, while Yeltsin fired his entire Cabinet. 
So on the surface, at least, it's back to business. Remarkably, the
Boris-and-Bill show just keeps on running. Between the two of them, the
presidents of the United States and Russia survive elections, coup attempts
and scandal. Their personal attributes are often open to question; their
tenacity is not. 
In the view of the administration, the warmth between Clinton and
Yeltsin remains a crucial element of American foreign policy--one that can
help determine the outcome of issues ranging from North Atlantic Treaty
Organization expansion to Russia's help for Iran. 
"Even in this era, personal relations among leaders do matter a lot
and there's no more positive example than the relationship between these
two presidents," Deputy Secretary of State Strobe Talbott, the
administration's point-man for Russia, said in an interview this week. 
Nevertheless, it's only fair to wonder how much these two men matter
anymore to the future of relations between the United States and Russia.
Events are moving beyond them. 
There are many questions about the direction of Russia's foreign
policy. Was Russia's recent campaign with France and China to limit
American action against Saddam Hussein a harbinger of new foreign-policy
alignments? 
How will Russia react in the years after NATO expands its membership
to Poland, Hungary and the Czech Republic? And what will happen if and when
NATO tries to bring in other new countries besides these three? 
The answers may well depend on who will lead Russia after the
departure of Yeltsin, who is 67 and whose term expires in 2000. 
Washington is once again awash with rumors about Yeltsin's health. His
erratic performances are said to be the possible result of heart problems
or depression or both. In his growing isolation, he is said to be relying
heavily on the advice of his daughter, Tatyana Dyachenko. 


The Clinton administration is now scurrying to adjust to Yeltsin's
Cabinet shake-up and the changing political situation in Moscow. 
Over the last five years, the administration had devoted extraordinary
energy courting Viktor S. Chernomyrdin, the prime minister Yeltsin just
sacked. Vice President Al Gore had been meeting with Chernomyrdin twice a
year. Less than a month ago, the vice president took the time to escort the
Russian premier on a tour of Silicon Valley. 
When Chernomyrdin was fired only a few days later, the administration
acted for all the world as though nothing important had happened. "I have
no reason to believe that anything different will occur," said Clinton. Yet
the president took care to write Yeltsin a personal note from Africa and to
make the phone call in Washington on Monday. 
Talbott heaped praise on Russia's new acting prime minister, Sergei V.
Kiriyenko, who is only 38 years old and has only a year of government
service in Moscow. 
"There's an awful lot of instant conventional wisdom that he's a
transitional figure," Talbott said. "The fact that he's inexperienced and
unseasoned in the Soviet mind-set is not all bad, to put it mildly."
Kiriyenko, he went on, "could be on the cutting edge of the passing of the
torch from one generation to another." 
Figuring out who really runs Moscow these days is no longer as easy
for Washington as it used to be. Take the example of the CIA and its
changing wall charts. 
Back in the Cold War, the CIA used to publish regularly a glossy chart
of the Soviet leadership. It was a rundown of the Politburo, with pictures
and thumbnail biographies of each of the members. 
Now, the CIA is putting out a different kind of chart, one that would
have been unimaginable a decade ago. It is entitled "Russia's Business
Magnates," and it shows pictures of the tycoons who run various industry
groups like Gazprom, Russia's huge energy enterprise. Once, the CIA was
full of Kremlinologists. Now the same people are turning into
Gazpromologists. 
The Clinton administration's view of Russia is not as optimistic as it
was five years ago. 
Former Secretary of State Warren Christopher, looking back on an
address he gave in 1993, admits in an upcoming book that, in retrospect,
"we did overestimate the popularity and strength of reform in Russia." 
Clinton and his team deserve credit for doing as much as possible to
help nurse along democracy in Russia. Yet every week, it seems, more
instances crop up of the ways in which Russia poses problems for American
foreign policy. 
Only two days ago, for example, Acting Atomic Energy Minister Yevgeny
Adamov announced that Russia will go ahead, at a faster pace, in helping
Iran to complete its nuclear power plant at Bushehr--a project the Clinton
administration warned could help Iran's nuclear weapons program. 
Maybe Clinton can stop this Russian-Iranian project with a phone call.
Don't count on it, though. Sure, Bill and Boris still talk. But
Washington's transition to a post-Yeltsin era has already begun. 
Mann's column appears in this space every Wednesday. 


*********

#11
BABURIN: EUROPEAN SECURITY ARCHITECTURE WILL BE 
STABLE WITHOUT EASTWARD EXPANSION

MOSCOW, APRIL 8, 1998 /FROM RIA NOVOSTI CORRESPONDENT
GALINA AMELKINA/ -- No eastward expansion of NATO is required
for the continued stability and effectiveness of European
security architecture while the Alliance's shifts will lead to
constant tensions in Europe. This viewpoint was uttered at a
Duma press-conference today by Sergey Baburin, one of the
leaders of the deputy group "Narodovlastiye" and a member of the
Duma ANTI-NATO commission.
He reported about an international conference, "A new
architecture of security in Europe and NATO" to take place on
April 16. This action, in the words of Baburin, has been
prepared by the Duma commission ANTI-NATO at the level of MPs
from European countries, including Belorussia, Ukraine, Latvia,
Norway, the USA, France and Germany. To appear at the conference
with their statements are Security Council Secretary Andrey
Kokoshin, acting Vice-Premier Ivan Rybkin and Duma Speaker
Gennady Seleznyov.
Baburin hopes that the conference will offer an open and
seminal conversation on security problems in Europe in the
context of an ever greater anxiety of European countries and
protest by the Russian public forces having reached nation-wide
consensus over NATO's expansion. Besides, the Moscow Mayor's
Office will stage a round table of public organisations,
dedicated to NATO's expansion to the east, on April 17.

********

#12
Moscow Times
April 8, 1998 
ESSAY: Tax Police Reveal Shady Side of Power, Money 
By Igor Gamayunov 

The tax organs can be considered the first to have uncovered the shadowy 
side of Russian life. If you have any doubts about this, you need only 
look to their special reports. I had a glance at some of them, and here 
is what I discovered. 

In the Moscow region, the tax inspectorate audited the Soyuz trading 
company and found that it had not paidany taxes. There was nothing 
illegal about this in itself; the company had been given a tax exemption 
by special decree of the regional property committee. But there was one 
disturbing detail. The last name of the head of the firm and that of the 
official who signed the document were the same. Only their middle 
initials differed. After a rather simple investigation, the tax 
inspectorate revealed that the young businessman who headed the company 
was the son of the head of the committee. 

This meant that for the sake of his son, the father had approved the 
exemptions so that the money that was supposed to flow into the state 
coffers lined the family's pockets. These pockets were deep, to say the 
least. In short, money that the state lacks to pay its workers -- 
pensioners, teachers, doctors and many others -- disappeared under a 
"paternal krysha." 

In the Tula region, about 150 kilometers south of Moscow, the tax police 
was interested in investigating a combine factory-turned-stock company. 
They found that the factory gave rise to an entire network of commercial 
enterprises, including a trading company, construction firm, bank and so 
on. The tax police's investigation into the practices of the Tula 


factory exposed a tendency that was repeated elsewhere. Such large 
companies were unprofitable and paralyzed by debt. The subsidiaries, 
however, which managed to hide their revenues, were prospering. They 
were able to do so through the protection of a powerful "official 
krysha." 

How? Through tax exemptions, credits and state investments. The heads of 
companies often turn out to be front men of very high-level officials, 
who use the money they receive to build luxurious cottages in 
picturesque suburban places. 

In the Udmurt republic in Central Russia, a trading company bought 
cattle, transported the meat to other regions and sold it for a profit. 
This is how market mechanisms should work. But on closer inspection, it 
was revealed that the firm had monopolized this trade. How? Through 
blackmail and threats. The company had employed armed thugs in leather 
jackets who visited the competitors and proposed that they close shop. 
The competitors had little choice but to comply. Can one speak of a 
market economy in such a situation? 

The cattle firm was not headed by just any ordinary citizen, but by a 
former convicted criminal. This person had decided that it was time to 
go from fighting economic battles to engaging in political ones, and ran 
for a deputy seat in the republic's parliament. The candidate may have 
shared the same fate as Gennady Konyakhin, a convicted car thief who is 
now in jail but is still officially mayor of the Siberian city of 
Leninsk-Kuznetsk, but he was prevented from running for office. 

The company had been audited in time. The audit uncovered its hidden 
revenues, a handful of fictitious firms through which money was 
laundered and documents for the transfer of city property, which 
formerly belonged to the kolkhoz. 

Former Interior Minister Anatoly Kulikov said in an interview that from 
40 to 50 percent of the revenues of organized criminals go toward paying 
off state officials. Alexander Dementyev, head of the main directorate 
in the fight against economic crime, added that it is the criminal 
nature of all branches of power that allows for so much untaxed money to 
be diverted from the state coffers. 

Dementyev categorically told me: "You won't find a single honest 
millionaire in the country, because the economy itself has been 
criminalized and does not permit people to raise capital through honest 
means." 

Perhaps he was overstating the case, and the corruption in government is 
only a temporary by-product of the transition from the Soviet economy. I 
spoke with Azalia Dolgova, president of the Association of 
Criminologists who is heading a working group of scholars preparing two 
bills for the State Duma, the lower house -- the so-called laws on the 
fight with organized crime and on the fight with corruption. 

Dolgova believes that, from the start, the very conception of reform of 
the centralized economy was not worked out to take the potential for 
crime into account. She pointed to former Prime Minister Yegor Gaidar's 
book, "State and Evolution," which clearly said that the authorities had 
no choice but to pay off the former Soviet party and economic 


nomenklatura. 

Dolgova concludes that organized crime, which has penetrated all layers 
of society, is in no way a mere consequence of reform, but the 
inevitable result of the corrupt way in which the transition was carried 
out. Yes, the authorities bought off the old nomenklatura, but at the 
cost of criminalizing the state. In order to strengthen their position, 
the new owners in their turn are buying off new authorities. 

It is now clear that steps must be taken to rectify the reform policies. 
One such step is Dolgova's work on the bills on battling organized crime 
and corruption. The legislation on corruption has been passed three 
times by the Duma and the Federation Council, the upper house, in 1993, 
1995 and 1997, and the president has sent it back on each occasion. 

The bill says that any person running for government office is obliged 
to declare not only his taxable income and property, but his spouse's as 
well. Moreover, he must make his bank account, both in Russia and 
abroad, available for inspection and be able to account for the source 
of his income. He must also declare his participation as a stockholder 
or founder of any company, and inform the tax inspectorate of any gifts, 
services or power of attorney over the property of others. According to 
this law, the income declarations of category "A" officials, which 
include the highest members of the government, must be open to the 
public. Such officials must also declare their income three years after 
stepping down from public office. 

"The legislative norms that we have worked out," Dolgova said, "are in 
keeping with international legal practice. In developed countries, this 
would in no way be considered a violation of human rights." 

But here in Russia, I thought to myself, the president's close circle, 
for the sake of its own financial gain, will obstruct the adoption of 
this law until corruption in the country becomes a natural calamity. 

Could this be the reason President Boris Yeltsin suddenly decided to 
make such a sharp change in those around him by dismissing the 
government? 

Igor Gamayunov is a staff writer for Literaturnaya Gazeta. He 
contributed this comment to The Moscow Times. 

*******

#13
Key points of Russian PM's draft programme

MOSCOW, April 7 (Reuters) - Russian prime minister-designate Sergei Kiriyenko
distributed draft notes outlining his programme to participants at Tuesday's
round-table talks with President Boris Yeltsin, a parliamentary official said.

The official showed the draft, in note form and headlined ``Themes for
Programme Speech,'' to Reuters. 

Kiriyenko will present his programme to the State Duma lower house of
parliament on Friday, the same day the Duma will vote on whether to endorse
Yeltsin's nomination of the 35-year-old as prime minister. 

Here are highlights of the draft (only phrases in quotation marks are direct
translations): 

The programme speech contains fundamentals. ``The detailed programme demands
time and will be a result of cooperation, integrating the best ideas of the
government, legislators, the provinces and the business and scientific


communities.'' 

There is a base of achievement including a stable rouble, controlled inflation
and a private sector. The slump in output has been halted. ``But there have
been mistakes.'' These include ``unrealistic budgets,'' underestimating
dangers of growing state debt, weak state control of monopolies and slow tax
reform. 

``As a result, the positive trends are fragile and could be undermined by
external factors -- a crisis on world financial markets or a fall in export
prices.'' 

``The public understands what must be done...The problem is how to do it, what
mechanisms and instruments.'' 

The government should be ``strong, responsible, modest.'' 

Strong government should maintain single economic and legal systems, a level
playing field for business, public order and safety and social support for the
disadvantaged. 

Responsible government pays its debts. 

Modest government lives within its means and cuts back on staff, construction
and unjustified subsidies. 

The state can raise more money by better management of assets, better tax
collection, alcohol and tobacco monopolies, using natural resource monopolies,
good foreign debt management. 

An active industrial policy can raise output, bolstering tax revenues.
Elements of industrial policy would include: cutting the tax burden on
responsible taxpayers, cutting prices charged by natural monopolies, cutting
interest rates, restructuring corporate debt, cutting red tape for business,
supporting exports and protecting domestic manufacturers. 

Rationalising expenditure would include: a national economy drive, tidying up
local government budgets and putting an end to non-monetary forms of payment
and barter deals. 

An ``active social policy and fight against poverty'' to be based on higher
output and healthy finances. It would include: paying off public sector wage
arrears and creating a mechanism to prevent a recurrence, encouraging wages to
rise in line with productivity, a lower personal tax burden, social justice
and ``stopping the rich benefiting at the expense of the poor,'' targeting
welfare payments and reducing ``material injustice.'' 

Government must work more effectively, with less red tape to strangle good
ideas. Civil servants should be properly paid to discourage corruption and
should also be apolitical. 

``On every policy, from the very beginning (there should be) cooperation with
the State Duma and Federation Council (lower and upper houses of
parliament).'' Permanent consultation mechanisms should be set up involving
committees staffed by both government and parliamentary officials. 

********

#14
RFE/RL NEWSLINE Vol 2, No. 68 Part I, 8 April 1998

NEW LAW ON MILITARY SERVICE GOES INTO FORCE. According to 
"Krasnaya Zvezda" on 4 April, the new law on military 
service in Russia exempts from the draft all people with 
criminal records, university students, and workers in 
industries providing services for the military or for the 
security the country. The law, which went into effect on 2 
April, also limits the period of time that members of the 
armed forces can serve; in most cases, this means retirement 


at age 45, but for high ranking officers such as admirals 
and generals is extended to age 60. The death of an 
immediate family member is also cause for exemption from the 
draft. "Izvestiya" on 8 April cites the example of an 
officer who has gone unpaid for several months and is now 
seeking early discharge from the military on the grounds 
that his contract has been violated. This precedent may 
quickly deplete the ranks of officers, "hundreds of whom are 
in the same position," the daily argues. BP

**********

#15
Chubays Comments on Election to UES Board 

MOSCOW, April 5 (Interfax) -- Former Russian First Deputy Prime
Minister Anatoliy Chubays regards his election to the Board of Directors of
Russia's electricity monopoly, Unified Energy Systems [UES], as "a great
responsibility," he told Interfax by phone from Eastern Europe, where he is
on a private visit.
He emphasized that he had not held any preliminary talks on his
election with any shareholder, he did give anyone any pledges and at UES he
will not represent anyone else. As a member of the Board of Directors he
pledged to work toward restructuring the company and developing it as a
whole. "This meets the interests of the country and the UES shareholders,"
Chubays said.
He said he was pleased that the number of state representatives in the
board had risen from seven to nine. In addition, two other people, General
Director of the Tyumen electricity company Vladimir Bogan and Governor of
Orenburg region Vladimir Yelagin, who were elected as state
representatives, are also "in fact working for the state," he said . "This
is a guarantee that the interests of the state will not be hurt," Chubays
said.
Speaking highly of the new board's capability, he said that "solving
problems, accounting for the bulk of insolvency today, is quite within the
power of such a team," which is led by Deputy Fuel Minister Viktor
Kudryaviy.

*********