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25 May 1998
[Note from David Johnson:
1. Reuters: Russian '97 GDP growth revised to 0.8 from 0.4 pct.
2. Reuters: DeBakey Says Yeltsin has No Secret Disease.
3. Segodnya: Pavel Felgenhauer, U.S. CONGRESS APPROVES SANCTIONS
AGAINST RUSSIA. The cold war is still on for the US law-makers.
4. Reuters: Yeltsin worried by media magnates' power.
5. Los Angeles Times: Richard Paddock, Bitter Battle to Lay Sons'
Lost Souls to Rest.
6. Komsomolskaya Pravda: Interview with Moscow Mayor Yuriy
"Yuriy Luzhkov: What Does Not Harm Moscow Is Good for Russia Too."
7. Itar-Tass: Russian Communists To Switch to 'genuine Confrontation.']
Russian '97 GDP growth revised to 0.8 from 0.4 pct
MOSCOW, May 25 (Reuters) - Russia's 1997 gross domestic product rose by 0.8
percent year-on-year, not 0.4 percent as previously estimated, a State
Statistics Committee official said on Monday, quoting revised data.
Vera Sukhanova, head of the committee's GDP calculation department, told
Reuters the change was due to new data on 1996 GDP, which turned out to be
lower than originally calculated. The revised 1996 figure was not immediately
Last year was the first year of growth since 1989.
This month's financial crisis, which prompted the central bank to raise
interest rates sharply, has made even modest growth unlikely in 1998.
A senior government source told reporters last week that zero-growth was
anticipated. Previous official estimates have ranged between one and two
DeBakey Says Yeltsin has No Secret Disease
May 24, 1998
MOSCOW -- (Reuters) The U.S. surgeon who consulted Russian doctors on
the major heart surgery they performed on President Boris Yeltsin in
1996 said on Sunday the Kremlin leader had no secret illnesses.
"I saw him the day before yesterday. He's in good, vigorous health,
quite alert and in good spirits so there are no secrets about his
health," Michael DeBakey told Ekho Moskvy radio.
DeBakey, in Moscow to present Yeltsin with his new book "The Living
Heart," said after the meeting on Friday that the president's health was
excellent and he could run in a new election due in 2000 if he so
Some parts of the mass media had speculated Yeltsin, 67, might be
suffering from an illness affecting his mental agility after occasional
displays of erratic behavior in recent months.
The speculation has been fueled by a tradition of secrecy over the
health of Kremlin leaders throughout the communist era which persisted
after Yeltsin was elected president in 1991.
Until 1995, Yeltsin always denied he had any serious health worries
despite reported heart problems.
When he disappeared from view just before the runoff of a 1996
presidential election, his aides said at first he had a cold. The
surgeon who conducted heart surgery on him four months later said later
he had suffered an unreported heart attack.
Apart from a bout of influenza and a cold this year, Yeltsin has
appeared to be well, but he sometimes seems distant and unfocused and
remains sensitive on the health issue.
"The subject of the president's health should be closed," he told a
Kremlin meeting in March.
DeBakey, who stressed on Friday Yeltsin was mentally, as well as
physically fit, said secrecy was not a good idea.
"I don't think it's advisable to hold medical secrets from the people. I
think we should be honest with the people, especially with the health of
the leaders of the people. That's very important," he said.
DeBakey said doctors did have an ethical duty not to disclose medical
details without a person's consent.
"But in the case of a political person...we don't keep that kind of
secret," he said.
Answering listeners' questions, the pioneering U.S. surgeon underlined
he was not recommending a new term for Yeltsin, who has in any case
appeared to rule out running again.
"I am certainly not recommending he do it, that's not my problem, I have
no right to do that," DeBakey said.
>From RIA Novosti
May 25, 1998
U.S. CONGRESS APPROVES SANCTIONS AGAINST RUSSIA
The cold war is still on for the US law-makers
By Pavel FELGENGAUER
Despite the desperate efforts of the White House, the US
Congress virtually unanimously approved late last week the law
on sanctions against foreign individuals and organisations who
help Iran to create ballistic weapons, or more precisely, the
Shahhab-3 missile which can be used against Israel. Russia is
not openly mentioned in the text of the law, but the Senators
made no secret of the fact that sanctions would be directed
against Moscow. The House of Representatives unanimously
approved that law six months ago, and hence it will be
forwarded to President Clinton.
Sanctions in themselves do not look so frightening.
Organisations and individuals put on the black list will be
deprived of any US assistance and credits for two years, will
be prohibited to buy dual-purpose equipment, in particular
powerful computers, software, etc..
The trouble is not what economic damage this law can do to
Russia. It is more important that the US Congress recognised
democratic Russia as an enemy which "threatens the USA and its
allies" for the first time since the end of the cold war. And
all this despite Moscow's repeated statements to the effect
that nobody in Russia consistently helps Iran to create
missiles, and the US failure to provide any serious proof to
the contrary. The only "proof" it has is the lorry with 22 tons
of Russian-made stainless steel, which can be used for the
production of Scud-type small-range missiles, arrested on the
Iran-Azerbaijan border. But these missiles cannot reach Israel.
In principle, the best missile defence Israel could have
is reliable peace with Arab countries. A missile with the range
of 1,300km is obsolete technology of the 1950s. No matter what
the US Congress does, Iran will build such missiles all the
same, buying the requisite equipment and materials in the West,
if not in Russia, or in China, Korea, Pakistan, India, or
The trouble is that the current Israeli government led by
Netanyahu and the Israeli General Staff, outraged at the idea
of reducing defence spending and the armed forces, don't want
peace with the Arabs. That is why the Israeli intelligence has
been faking "proof" of the "Iranian missile threat" for many
years now. And to frighten the world even more, they added
Russia as an accomplice. It appears that most US law-makers
regard Russians as enemies just because they are Russians, and
the ideology of the current Moscow government has nothing to do
with this. So, they only needed a pretext to introduce
When the bulk of US Senators voted for the ratification of
the NATO enlargement, and less than a month later approved
sanctions against Russia, we can hardly expect the Russian
State Duma to ratify the START-2 Treaty soon. In-depth nuclear
disarmament calls for mutual trust, and what trust can there be
between enemies? The White House understands this only too
well, and that is why Clinton has promised to veto the
sanctions. But these are mere words. The law enjoyed unilateral
approval, and so the presidential veto will be easily overcome.
FOCUS-Yeltsin worried by media magnates' power
By Timothy Heritage
MOSCOW, May 25 (Reuters) - President Boris Yeltsin, making a new attack on
power-hungry Russian financial groups with vast newspaper and television
empires, accused media magnates on Monday of censoring news for their own
A Kremlin spokesman followed Yeltsin's remarks by saying television coverage
of Russian miners' protests had gone too far and announced that the president
would meet the heads of three networks on Thursday to discuss cooperation with
``The media owners are sometimes the worst censors. They openly interfere in
editorial policy, deciding what should or should not be written or said,''
Yeltsin said in a speech opening a congress of the International Press
Institute watchdog group.
``As a result, the people's right to objective and truthful information is in
jeopardy,'' he told Russian and foreign editors gathered in Moscow for the
Yeltsin said the Russian media had taken giant strides towards independence
since seven decades of communist censorship ended with the collapse of the
Soviet Union in 1991, and praised journalists' courage, bravery and defence of
But he added: ``There are some people who still harbour the illusion that
journalists must serve the powers-that-be, that the press must be given
Yeltsin's comments were aimed at a few tycoons who have bought stakes in or
gained full ownership of many of Russia's major newspapers, magazines and
television and radio channels.
The most powerful media magnates include UNEXIMBANK chief Vladimir Potanin,
businessman-turned-politician Boris Berezovsky, Most Group chief Vladimir
Gusinsky, Alexander Smolensky of SBS-AgroBank and Menatep head Mikhail
The Kremlin and government have their own newspapers and controls the second
channels RTR. The government also has a majority stake in ORT public
television, but its editorial policies are often at odds with the cabinet
Yeltsin, who did not name any media in his speech, has repeatedly said he is
the guarantor of a free press.
But he is also worried that many of the leading newspapers and television
channels are now in the hands of a few financial groups, giving them a direct
channel to ordinary Russians and increasing their hopes of swaying Kremlin and
Yeltsin is also wary that the media might turn against him and the Kremlin,
further reducing his popularity and denting the chances of whoever he wants to
be his successor winning the presidential election due in the year 2000.
The support of most media and a group of seven major financiers, including
media barons, was vital to Yeltsin's re-election in 1996.
But the Kremlin's grip over the media has slipped since then and the seven
financiers' alliance has collapsed. Yeltsin has tried to reduce their
influence and they have hit back with attacks on the authorities and on each
other in their media.
The media is sure to be influential in the 2000 election. Yeltsin's press
secretary, Sergei Yastrzhembsky, underlined the Kremlin's concern by
criticising coverage of protests by unpaid miners blocking railways for the
last 10 days.
``I am referring to media responsibility for the supply of information,''
Yastrzhembsky told a news briefing. ``There have been occasions when this
supply -- as in the case of the railways war -- went beyond reasonable
He said Yeltsin would discuss ``cooperation between the authorities and the
media'' with the heads of ORT, RTR and Gusinsky's commercial channel NTV.
Earlier this month Yeltsin ordered RTR and the network of state-owned local
television stations to be turned into a powerful media holding, similar to
those financial groups have formed, and tightening government control.
Yastrzhembsky did not explain his criticism. But reports on the miners'
protests, giving prominence to criticism of Yeltsin and his government, have
led news bulletins and have shown placards calling for Yeltsin's dismissal.
Los Angeles Times
May 24, 1998
[for personal use only]
Bitter Battle to Lay Sons' Lost Souls to Rest
Two Russian mothers are fighting over a sealed coffin each says holds
her child. Military's crude forensics and inept bureaucracy have forced
many into grim final crusades to find loved ones missing in Chechnya.
By RICHARD C. PADDOCK, Times Staff Writer
URYUPINO, Russia--The zinc-plated coffin was sitting in the living room
when the Ventsels came home one day. Their son, Yevgeny, had returned
from the Chechen war in a casket that was sealed shut.
Crushed by their loss, Alexander and Valentina Ventsel buried the
coffin three years ago in the village cemetery a short walk from their
house. Their neighbors named a road after Yevgeny and put up the
Siberian hamlet's first street sign in his honor. Nearly every day,
Valentina visited the grave and talked to her son.
But peace did not come to the little village of Uryupino.
More than a year after Yevgeny died, another mother who lost her
son in the 21-month war arrived with a disturbing question: Who is
really buried in Yevgeny Ventsel's grave?
Lyubov Tumayeva, searching for her son, Sergei, had become
convinced that the army had mistakenly sent his remains from the
separatist republic to this village on the Asian steppe. To the
Ventsels' dismay, Tumayeva launched a campaign to persuade the military
to exhume the body and--if she is proved right--to bring the coffin home
to Nizhny Novgorod, 1,500 miles away.
In her crusade, the single-minded secretary has traveled thousands
of miles and shed countless tears, berating generals, pleading with
prosecutors and threatening to set herself on fire in protest.
"There are cases where parents lose their minds when looking for
their sons, or die because of the emotional strain," said Tumayeva, a
graying, round-faced woman of 48. "These are true parents. I want to be
a true parent, one of these parents who never stop helping their child
until the parent is dead."
Tumayeva's obsession with finding her son has drawn national attention
to the plight of more than 1,200 families whose sons, brothers and
fathers are still listed as missing in action nearly two years after the
fighting in Chechnya ended. An estimated 80,000 people died in the war
that humbled Russia and won the small mountain republic its de facto
independence. Like Americans after the Vietnam War, many Russians are
still searching for soldiers held captive in Chechnya, buried on the
battlefield or lying unidentified in refrigerated railroad cars at a
makeshift morgue in Rostov-on-Don, northwest of Chechnya.
Tumayeva's supporters contend that the military is stalling in
resolving her case because hers is not the only one: At the height of
the war, they maintain, many families were sent the wrong bodies--or
just bricks and dirt--in sealed coffins.
The once mighty Russian army, defeated in war and decaying in
peacetime, has proved unable to uncover the truth in Uryupino. The army
acknowledges that some families were shipped the wrong corpses, but
officials say they cannot order the exhumation of Yevgeny's grave
without his parents' permission. The grief-stricken Ventsels refuse to
allow disinterment of the body who they believe is their boy and risk
losing him a second time.
War Is Over, but New Struggle is Born
In the end, the war that brought so much misery to Russia has left
this enduring image: two anguished families, whose sons died side by
side, quarreling over who should possess one corpse recovered from the
"They have pitted two mothers against each other, and they are
watching us fight," Valentina Ventsel said bitterly. "What is my guilt?
What am I to blame for? That I gave birth to a son and raised him to be
strong and healthy?"
When Lyubov Tumayeva arrived in the Altai region of Siberia in the
summer of 1996, it seemed that she and Valentina Ventsel had so much in
common. They greeted each other as sisters and walked together to the
Their sons had both fulfilled their dream of serving in Russia's
elite airborne troops. Both went to Chechnya in the first days of the
fighting--and tried to keep their mothers from knowing where they were.
Strong and athletic, they served together and were killed together as
they tried to storm the presidential palace in Grozny, the Chechen
capital. Sergei Tumayev was 19. Yevgeny Ventsel was 18.
"When Tumayeva first came and I met her, we cried together,"
Valentina Ventsel recalled. "I never could have imagined that events
would take such a turn. But I cannot say anything against her. She is
acting like an ideal mother. She is looking for her son."
Father Returns From Search a Broken Man
Tumayeva saw her son for the last time on the television news. It
was Jan. 7, 1995, and in a snippet of combat footage, she saw him
walking behind his commanding officer in a line of soldiers.
He died the next day, but Tumayeva did not learn of it for nearly
Worried because she had not heard from him, Tumayeva telephoned his
regiment two weeks after the broadcast and was told that he had been
wounded. He was taken to a hospital, an officer said, but no one knew
Her husband, Vladimir, a retired warrant officer who had fought in
the Afghan war, immediately left for southern Russia to search for him.
A month later, Tumayeva said, he came home a broken man. He never told
her what he found but would sit on the couch watching television while
tears poured down his cheeks. Eight months after Sergei disappeared,
Vladimir, 46, died of cancer; the doctors said stress was a major
"I think the people who unleashed this war should be damned,"
Tumayeva said. "They brought so much pain and sorrow upon us. All the
sacrifices were absolutely senseless. This war has taken everything from
During the war, the Russian government tried to defuse public
protest by maintaining that its soldiers were in Chechnya voluntarily.
But the claim backfired and prompted mothers from all over Russia to go
to the war zone, find their sons' regiments and take their boys home.
After the war ended, other mothers combed battlefields and villages,
hospitals and morgues to find their missing sons.
In the fall of 1995, Tumayeva decided it was her turn.
Her first stop was the military headquarters in Moscow, 250 miles
west of Nizhny Novgorod. Learning little from her son's commanders, she
headed south to Rostov-on-Don and the military laboratory that has
become a beacon for Russia's bereaved war parents.
At the 124th Forensic Medical Laboratory, sandwiched between
apartment buildings in a residential neighborhood, army doctors try to
identify more than 440 bodies remaining from the war. It is here that
Russia's anguish over the Chechen war is most evident, where parents
face their worst fears and, sometimes, learn the fate of their sons.
The forensic methods of the Russian army are primitive. DNA testing
is prohibitively expensive. Dental charts and fingerprint records are
nonexistent. So the doctors compare enlistment chest X-rays with those
of cadavers. They search for similarities between the fingerprints of
corpses and the relatives of the missing. And they try to match old
photos of soldiers with skulls in the morgue.
Often, this means grisly work to prepare the bodies. In the lab's
courtyard, enlisted men boil the heads of unidentified soldiers one at a
time in 10-gallon caldrons over an open fire to remove remaining tissue.
Later, key features of the skull are marked and then superimposed by
computer over photographs of missing soldiers--the same method
scientists used to help identify the remains of Czar Nicholas II and his
For the parents, the worst is studying the lab's gruesome
videotapes of the corpses. Tumayeva spent days watching the videos of
hundreds of bodies but never found any sign of Sergei. "If you have to
find your son, you'll do anything in this world to find him," she said.
Back in Nizhny Novgorod, she kept calling the officers of his
regiment until one finally gave her the addresses of soldiers who had
served with Sergei. She wrote to each of them, asking what had happened
to her son.
Three soldiers wrote back and gave the same account: In the attack
on the presidential palace, Sergei and Yevgeny were trapped by enemy
fire with their lieutenant, Andrei Zelenkovsky. The three were carrying
explosives; nearby, a damaged armored personnel carrier was leaking
fuel. When a shell landed near them, the explosion and fire were so
intense only one body was found intact.
The soldiers said they identified the charred corpse as Sergei because
they recognized his chipped tooth and a small patch of sweater that was
not burned. But the unit's medic told the soldiers that he had seen
Sergei's name on a list of wounded and insisted that the body belonged
to Yevgeny Ventsel. Later, they discovered that the hospitalized soldier
was not Sergei but someone with a similar name.
"I don't understand why the officers from the unit did not inform
you of this," wrote former Pvt. Viktor Afonchenkov. "Sergei's corpse was
sent to the Altai territory and buried as Ventsel's."
Afonchenkov apologized for delivering the bad news but concluded:
"It is better to know the bitter truth than to believe sweet lies. Do
not believe what they tell you at the unit. They are just . . . trying
to save face."
Vladimir L. Kravchenko, the medic accused of misidentifying the
corpse, still says he is positive that he identified the corpse
correctly but agrees that the body should be exhumed so there will be no
"I am sure that was Ventsel in the coffin and we made no mistake,"
he said. "I am sorry for Tumayeva. She is trying to clutch at a straw to
find her son's remains."
After receiving the letters, Tumayeva asked the military
prosecutor's office, the agency that investigates misconduct in the
military, to dig up the body and determine who it was. The prosecutor's
office agreed and sent a young lieutenant and two soldiers with her to
carry out the exhumation.
Family Refuses to Allow Exhumation
Uryupino lies 1,750 miles east of Moscow, not far from the industrial
city of Barnaul. Its 200 families support themselves by growing wheat
and potatoes. In winter, horse-drawn sleds are as common as cars on the
frozen dirt roads.
Like many people in the Altai region, Alexander Ventsel is of
German descent and could have immigrated with his family to Germany
after the breakup of the Soviet Union in 1991. But with his job as chief
engineer of the village farm and Valentina's post as school director,
they chose to stay--and their son went off to war.
After Tumayeva and her entourage arrived, the mothers' initial
friendship quickly deteriorated. Tumayeva insisted that the body be
exhumed, and Valentina Ventsel refused.
"At first I thought: 'Let's do it. Let's open the grave and exhume
the body. It will be easy,' " Ventsel recalled. "And then I looked at
the picture of my son [on the tombstone] and he was staring at me,
asking me: 'Mom, what are you doing? You never protected me when I was
alive, and you are letting me down when I am dead.' And I couldn't do
For the Ventsels, the stakes were high. If the coffin did not hold
Yevgeny, they would face the challenge of starting their own arduous
search. Dozens of relatives and friends gathered at the grave to help
the family block the exhumation.
The Ventsels proposed to Tumayeva that they leave the body there
and share the grave, even adding Sergei's name and photograph to the
monument. But Tumayeva refused.
"How can you carry on living when you know your son is lying somewhere
far away, and strangers are taking care of his grave and his body?"
Tumayeva asked. "When he finds out that I as his mother did not bring
his body back, he will be very much offended."
Tumayeva, on leave from her job at an aviation factory, stayed more
than two months trying to get the body exhumed, living with a local
family and surviving on the generosity of strangers. Officers and local
military prosecutors regularly came to the village, ostensibly to help,
but she became convinced that their real goal was to block the
"They wanted to hush the case up and turn it into a conflict
between two parents over one body," Tumayeva said. "On several occasions
they had buried empty coffins, and if I find the real body, all this
Since that first meeting, Tumayeva has gone back to the region
three times, but the Ventsels won't budge. They told Tumayeva that they
will give her the coffin only when she finds Yevgeny's body.
And so in December she began her second grisly search--this time
for the Ventsels' son. She went back to the lab in Rostov-on-Don and
viewed the videotapes again. From a newspaper photo, she identified the
corpse of another lieutenant who had died attacking the presidential
palace and had been lying in the morgue for nearly three years. But she
didn't find Yevgeny.
Col. Vladimir Shcherbakov, a doctor and forensic specialist who
heads the lab, said his experts have worked closely with Tumayeva but
that the case is one of the most difficult that they have tried to
So far, the lab has stumbled onto six cases of soldiers who were
misidentified by field medics and buried under the wrong names,
Shcherbakov said. In each instance, the lab identified a body only to
find that the soldier's family had already received a coffin. The first
corpses were exhumed, properly identified and sent to their real
families for reburial.
Speculation Abounds on Casket's Contents
Tumayeva's case is more complicated, he said. There is a question
not only about who is buried in Yevgeny Ventsel's coffin, he said, but
also what is buried in the grave of Zelenkovsky, the lieutenant killed
alongside the two soldiers. Some members of the unit say his casket is
empty; others say it contains legs and feet from all three victims.
"We cannot rule out that in Tumayev's case there is an instance of
mistaken identity and false burial," Shcherbakov said. "It's possible
that Tumayev's body is buried as Ventsel's body. It's also possible that
part of Tumayev's body is buried in Zelenkovsky's coffin."
Sergei Ushakov, a spokesman for the military prosecutor, insists
that his office favors exhuming the body in Ventsel's grave but is
unable to proceed because the family will not give its consent.
"We are as much interested in finding out who is buried there as
the mother [Tumayeva] herself," Ushakov said. "But an exhumation will
not make the sufferings of the mothers any easier. One of the sons will
still be missing, which means that one of the mothers will still be
distraught with grief."
In February, Russian Prosecutor General Yuri Skuratov personally
promised Tumayeva that he would take over the case from the military
prosecutor's office and conduct his own investigation. But an aide said
later that it would be many months before the matter is resolved.
In Uryupino, the Siberian days are getting warmer and the ground is
starting to thaw. In her "mother's heart," Valentina Ventsel says she
knows that it is her son in the coffin. But soon, she worries, Tumayeva
will return to the village in the hope of digging up his grave.
"Have you ever hunted?" Ventsel asked. "I have. There are certain
seasons for hunting different animals. They are brief periods, but they
come every year. Summer is approaching, and I am beginning to feel that
the hunt is coming for me."
Moscow Mayor Luzhkov Interviewed
20 May 1998
[translation for personal use only]
Interview with Moscow Mayor Yuriy Luzhkov by Mikhail
Shcherbachenko; date, place not stated: "Yuriy Luzhkov: What Does
Not Harm Moscow Is Good for Russia Too" -- first two paragraphs are
In preparing to interview the Moscow mayor journalists always
specially construct a question about Yuriy Luzhkov's presidential
ambitions. Of course it is clear to penetrating interviewers that he has a
plan to move to the Kremlin. Otherwise why strengthen the Moscow
principality with its rivers of investments and fuel, major defense plants,
giant automobile plants, and banking colossuses? Why use sweet speeches
and visits to upset the calm of the guberniya leaders? Why flirt so
adroitly from time to time with the incorruptible frondeurs ("You are
leaving the opposition with no work to do" -- was what the supreme
troublemaker Zhirinovskiy once said to Luzhkov) or maybe support, if he
feels like it, a party or public movement? There is no point even in
mentioning the advertising shows like the 850th anniversary of Moscow or
the forthcoming Youth Olympics. In brief, there is material evidence, all
that is left is to extract a voluntary confession.
This has become a sport for interviewers. And for the mayor it has
become a form of entertainment which he does not intend to deny himself.
[Shcherbachenko] Yuriy Mikhaylovich, perhaps I should not ask if you
intend to run for president?
[Luzhkov] No, that would go against the ritual.
[Shcherbachenko] Then it is better that I repeat your recent replies.
"Ask the Muscovites if they agree to let Luzhkov go" -- that's one. "I
have not yet done everything I promised the voters" -- two. "What didn't
you like about me as mayor?" -- three. And here is what in my opinion is a
wonderful answer: "Things are bad OVER THERE...." But I did not want to
ask because I do not actually have any hope of learning the truth.
[Luzhkov] Nonetheless you can write down one more reply: As an
active associate of Yeltsin's I would like his time not to come to an end
for as long as possible.
[Shcherbachenko] But still: In allowing at least in theory the
possibility that you may take part in the presidential elections, you
cannot rule out the likelihood of victory. After all, you probably read
"studies" on the subject of what will happen to the country if the people
elect Luzhkov. It seems to me that there is nothing wrong in discussions
like "If I were director." So how would the Moscow mayor be useful to
[Luzhkov] First of all, of course, through his Moscow experience. In
what sphere? In the most diverse spheres. For instance, there is a
pilgrimage from almost every region to our Ring Road. They come and ask
for the Moscow Government documents showing how we organized work.
People come to us for knowledge about the organization of small
business. Because they have realized how important this is -- after all,
as I do not tire of repeating, half our city budget is provided by taxes
from small business.
[Shcherbachenko] And do they not ask to learn how to achieve special
rights and terms for their domains? After all, your sworn friends
everywhere say that Luzhkov's main skill is his ability to exclude Moscow
from the common rules, while continuing to declare its equality with all
provinces without exception. Like Orwell: "All animals are equal but some
are more equal than others."
[Luzhkov] Yes, sometimes I have to try to get special terms for
Moscow. What of it, is there anyone to whom it is still not clear who was
right in my quarrel with Chubays about privatization methods? The
president gave Moscow special powers. And last year we obtained 8 trillion
rubles [R] from privatization while all Russia obtained 17 trillion. Well,
isn't that an impressive comparison.
Just answer me this, who would have lost out if the Moscow method of
selling property for a decent price and not for a pittance had been adopted
for all Russia?
Of course, the country's president or the government premier on the
one hand and the capital's mayor on the other have completely different
work areas but the economic principles are universal. Moscow lives by the
state "schedule," the all-Russian "schedule," and only in exceptional cases
do I allow myself to ask the president for "special status." And so....
Of course if I had my way both Moscow and the whole country would live by
completely different customs rules, for instance.
Who established colossal duty for the purchase of equipment for the
production of goods and low duty for finished imported articles? As a
result we fail to get jobs and our enterprises are becoming ineffective
because of the lack of equipment and we are undermining the foundations of
our own economy.
Think about it: We have fine sources of mineral water -- table water,
curative water, and spring water. But we import Perrier, Vera, and similar
products. A bottle of Perrier has a retail price of $1.5 yet its prime
cost with transport is 15 cents. Any firm will give whatever you want for
that kind of tenfold markup! But the Russian producer is deprived of
incentives to increase production volumes. Where is sensible
[Shcherbachenko] Clearly Moscow is subject to statewide legislation,
but you must agree, Yuriy Mikhaylovich, that the customs duty and the tax
policy which you regularly criticize are less painful for the capital than
they are for 81 out of 89 regions which, as we know, are subsidised.
[Luzhkov] Recently I have been thinking frequently about the moral
aspect of subsidies. Essentially, after all, they are a great evil!
Subsidies are humiliating. They increase regions' dependence on the state
and at the same time they corrupt economic leaders.
Subsidies are also humiliating for citizens because they keep them
dependent on the authorities.
Moscow is not poor. There is no unemployment in Moscow. The level of
wages for an able-bodied Muscovite today is $300 a month. Prices in
Russia's capital are comparable with prices in other capitals and even in
some respects a little higher. So the average wage does not ensure proper
Here the city is paying two thirds of housing and municipal services
expenditure. For people this would seem to be a help yet it does not make
the family independent. The family is in a state of constant concern that
the state will abandon subsidies and then the family's economy will be
So for us the questions of economic independence through the
privatization of wages are among the fundamental questions of reform. And
we say that it is better to pay a man $700 and let him hand over $250 for
housing and municipal services and feel protected from changeable state
economic policy. The family's independence boosts citizens' morale.
My firm conviction is that the authorities must stop commanding and
dictating. Today they have a different task -- serving. Serving the
Muscovites, serving business, serving the city system which, in turn,
should service the population. We must resolutely alter the philosophy of
[Shcherbachenko] Although "serving" and "service" are words with the
same root they are not entirely synonymous. The exalted and the earthly.
Could you give an example of their combination?
[Luzhkov] No problem. At the very start of the nineties we
constructed about 1 million square meters of housing a year. Extremely
inadequate for the city's needs. We risked using bank credits to finance
housing (although there was much that was still vague) and immediately
reached a figure of 3 million square meters. This stage, unfortunately,
ended quite quickly -- with the start of monetarism in present-day Russia.
The banks immediately geared themselves to obtaining "short" money and
credit rates soared to 200 percent and we were obliged to abandon this type
of funding. We found another. We decided to retain the previous 3 million
square meters and hand over 1 million to Muscovites free of charge and sell
2 million and invest the money obtained in new construction. That is how
we are living to this day although the resources are drying up and
supplements from the budget have already begun.
Here you have a situation where the authorities have been faced with a
dilemma: recognizing that there is no way out of the situation or
inventing a solution. For us the former is unacceptable in principle so we
are left with the latter.
We saw a way out in setting up mortgages -- credit with real estate as
collateral. All the newspapers wrote about this recently, so I shall not
go into unnecessary detail. If we receive basic financial resources which
can be used for housing construction at a low interest rate almost equal to
the pace of world inflation and if we organize this system in such a way
that the repayment of the sum is in about 20 years, then we shall not only
retain housing construction volumes but also increase them to 4-4.5 million
square meters a year.
[Shcherbachenko] It is all very well for you to speak of mortgages
and other foreign things -- given Moscow's credit rating! But you are not
an example of a Russian province: How can the mayor of Hicksville attract
[Luzhkov] There was a time when we too spent two dollars trying to
attract one. You mentioned credit rating -- but do you know how much the
Moscow authorities sweated until we were trusted and money was entrusted to
us! How many normative documents we signed, how many city laws we adopted
-- a whole volume! And we kept track to ensure that we did not dupe a
single investor. But now when I meet with foreign businessmen I always
ask: "Hands up anyone who has lost money in Moscow." For me their silence
is the sweetest music.
And now look: Three years ago $890 million were invested in Moscow,
two years ago the figure was slightly over $4 billion and last year about
$10 billion. Foreigners invest more in the capital than in all the rest of
Russia. We have 85,000 foreign companies working here. Naturally their
money requires looking after and protecting. We created the Moscow
International Business Association specially for the purpose. We are
counting on receiving from it proposals as to what laws must be adopted at
city or state level to protect foreign business from force majeure
circumstances or dishonorable behavior on the Russian side.
And is Moscow's experience really useless to your Hicksville mayor?
Maybe not in its pure form, maybe with amendments, maybe not in its
entirety, but in terms of methodology and the principles for building
economic relations our system could very well be used from Kaliningrad to
Vladivostok. I see no obstacles. And I do not create any -- some and we
will show you and teach you.
[Shcherbachenko] Yuriy Mikhaylovich, is the ideology of the
authorities serving specific city dwellers compatible with your activity
with regard to the entire surrounding world? With the pursuit of municipal
foreign policy, so to speak. Thus the Hicksville mayor, to whom you have
obviously taken a liking, one fine day demand that Kazakhstan declare
Baykonur a "free cosmodrome" -- forgive me for the frivolous analogy....
[Luzhkov] You know, it is important for me to be clear in my own
mind. I try very hard and I want to succeed. Let us discuss this. I an
the elected mayor of a big city in which there is a complex economy.
Should I engage in the economy? I should, and I like doing so very much.
Moreover, I would like to engage exclusively in economic matters and give
100 percent of my time and potential to them. But!
Moscow is a whole system. System with its own political, social, and
cultural life. A city with its own position! And if the mayor dissociates
himself from indicating that position in questions of state building and
voids problems which influence the position of Moscow and the Muscovites in
one way or another, avoids the subject of the Russian-speaking population
in former Union republics, is afraid of even touching on geopolitical
questions, if they perturb his voters (and why should they not?) then is he
fit to represent his own city? [Luzhkov ends]
It was noted a long time ago that statements and actions which
sometimes seem uncharacteristic and illogical for a Moscow city chief some
time later (occasionally even a long time later) seem absolutely natural,
part of a system, of a pragmatically calculated plan for his own life and
that of the city. It often seems to people who observe Yuriy Mikhaylovich
from afar that his statements, which annoy society, are the result of the
ingenuity of the Moscow mayor's image makers. Those who are closer to him
know for sure that Luzhkov has nothing to do with image makers. He is his
own boss, the designer of his own fate and his own policy.
Luzhkov's theories rest on firm foundations, otherwise they would not
hold up. But they are made from flexible, elastic material and so they
have not turned into dogmas. And the mayor is too experienced in business
and in his private life to be a dogmatist. And those who love life do not
become dogmatists because they understand how much they can lose by
worshipping fossilized ideas.
Order is another matter. Not the kind of order in which you alone can
find your way while all around can see only chaos. For Luzhkov order is a
way of thinking and acting. A strong-willed man who has introduced order
in himself will not tolerate chaos around him.
Russian Communists To Switch to 'genuine Confrontation'
By Lyudmila Aleksandrova
MOSCOW, May 21 (Itar-Tass) -- The Communist Party of the Russian
Federation (CPRF), which is the main force of the opposition, is changing
its tactic. The upcoming extraordinary congress of the Party, scheduled
for May 23, will apparently be a definite milestone towards this change of
policy, although not a decisive one.
The change will apparently boil down to a switchover from the present
declarative opposition, consisting mainly of verbal threats to the
authorities, but actually seeking compromises with them, to a genuine
confrontation, primarily to the organisation of massive protest actions as
a method of seizing power. The approval of Sergey Kiriyenko's candidature
to the post of prime minister, when the communists lost the very last hope
for influencing the executive branch of government and getting at least
some of their men into the government, apparently put an end to the
"conciliatory" period of the Communist Party's work, which displeased the
The first signs, showing that the leftist opposition was indeed
becoming more radical, was the initiative to start impeachment proceedings
against the president in the Duma, and also the active speculation for
propaganda purposes on the current protest actions of miners and students.
Itar-Tass has learned from sources within the CPRF faction within the Duma
that the communists would strive for pre-term parliamentary elections and
their main task now is to prepare the party members for changing the style
of their work so that they would "join the masses" and go over from words
to the concrete organisation of protest actions. According to those
sources, the tension within the party tended to grow of late precisely
because the CPRF was not sure about the tactic it should choose. The
majority of the party, including its leaders, were prone to bring the
situation to a head.
As to the extraordinary congress of the Communist Party, which is to
open on Saturday, it will not, judging by everything, be of decisive
importance for the party. Besides some technical matters, including
amendments to the Party Rules to meet the requirements of the new
legislation, due to which the congress is actually being called, it is
expected to adopt a resolution on the party's attitude to the government's
course. No resolutions to alter the party's policy are expected to be
adopted, since all the important decisions will be discussed at the June 20
plenary meeting of the CPRF Central Committee, which will discuss the
situation in the country and within the party. The floor will be
apparently given at the Congress only to the advocates of different views,
so that they would outline their stands at the threshold of the plenum.
Sources within the communist faction asserted that it was absolutely
incorrect to speak about any split within the Communist Party or about the
shaky position of its leader -- Gennadiy Zyuganov. In reality, the
situation is as follows: it is true that there are several sufficiently
well-known personages within the Duma faction of the Communist Party, who
oppose Zyuganov's line both from the left and the right. Most notorious
among the "leftists" are Viktor Ilyukhin, Tatyana Astrakhankina, Albert
Makashov, and several others. From the "right" the leadership's line, at
least during the Duma's debate over the new premier, was opposed by Duma
Speaker Gennadiy Seleznev, Vice-Speaker Svetlana Goryacheva, as well as
Yuriy Voronin and Yuriy Maslyukov, and some others. The actions of the
latter group, however, are being explained within the Communist Party
leadership primarily by the assertion that these mps had placed their
personal interests (namely to save the Duma) above those of the party. The
leftists are more principled, but they are not calling for the replacement
of the party leaders and only want to "correct a little" Zyuganov's line.
The only man today, who is apt to raise the question of replacing the
party leader, besides the already known Teimuraz Avaliani, is member of the
Central Committee of the Communist Party of the Russian Federation Leonid
Petrovskiy, who has declared himself leader of the "Leninist-Stalinist
platform" within the CPRF. Communist faction experts claim that Petrovskiy
has no special supporters and that his platform does not deserve any
attention. However, he will definitely want to express his view at the
congress and plenum in order to win supporters. Be as it may, it appears
that there is no chance that Gennadiy Zyuganov will be thrown off the party
Olympus in the foreseeable future. The rank-and-file party members, though
they are displeased with the leadership's "conciliatory" steps, are not
calling for Zyuganov's resignation for the time being.
At present, the communists are deliberately embarking upon the course
of pre-term elections, wishing, last but not least, to make younger and
renew the Duma faction, to get rid, as they put it, of all the "ballast"
within it, which undermines the party's image as a monolithic force. The
party leadership is of the opinion that it is better to have a numerically
smaller, but more close-knit and efficient faction.