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CDI Library > Johnson's Russia List

Johnson's Russia List
 

 

October 30, 1998    
This Date's Issues: 2453 2454 


Johnson's Russia List
#2454
30 October 1998
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Russian govt draft anti-crisis plan main points.
2. Toronto Sun: Matthew Fisher, Throwing in the towel.
3. Bloomberg: Russian Government's Plan Not Enough to Boost Economy.
4. Reuters: Activists warn against return to Soviet past.
5. New York Times: Celestine Bohlen, Yeltsin Ready to Pick Constitutional 
Panel, Kremlin Says.

6. Washington Post: Nora Boustany, Regardless of Its Economic Ills, Russia 
'Cannot Afford to Be Passive Abroad.'

7. Interfax: Primakov Tops Popularity Ratings.
8. The Economist: Masterly inactivity.
9. Reuters: Muscovites Call Ailing Yeltsin an Embarrassment.
10. Chicago Tribune: Lynn Van Matre, IMMIGRANT SEEKING DONATIONS TO AID NEEDY
IN FORMER SOVIET UNION.
11. Reuters: Russia says its Caspian oil route still possible.
12. Peter Ekman: re Moore and Carter.
13. Moscow Times: Andrei Zolotov Jr., Sailors Put Their Subs Up for Adoption.
14. Itar-Tass: Zyuganov on 'Various Ways' of Electing Russian President.]

*******

#1
Russian govt draft anti-crisis plan main points

MOSCOW, Oct 30 (Reuters) - Leading business newspaper Kommersant Daily on
Friday printed what it said was the latest version of the Russian government's
anti-crisis plan, so far more than a month in the making. 
Kommersant said the new draft updated another it had published earlier this
week. The government is expected on Saturday finally to approve the plan. 
The main changes in the new document and other key details of the plan follow:

MAIN CHANGES 

Elimination of a requirement that exporters sell 25 percent of hard currency
receipts directly to the central bank. 
Elimination of guarantees on rouble and hard currency deposits in state-
controlled Sberbank and commercial banks. 
Elimination of a ban on offshore banks opening accounts in Russian banks and
Russian banks opening accounts offshore. 
Elimination of a point allowing regions to retain 60 percent of all tax
revenues collected above targeted levels. 
Introduction of a point calling for economic and administrative measures
against banks and other structures that launch speculative attacks on the
rouble. 
Introduction of a cap on price mark-ups on socially significant goods at 20
percent over wholesale prices. 

KEY POINTS 

A floating rouble will be established with short-term fluctuations governed by
interest rates and the money supply. 
Obligatory sales of hard currency by exporters will be raised to 75 percent of
their hard currency receipts. 
The timeframe for hard currency receipts to be repatriated will be shortened
for many sectors. 
The commercial banking industry will be restructured with introduction of
strict controls on hard currency operations. 
Value Added Tax will be gradually reduced and not accessed on some advance
payments to exporters. 
The central bank will issue credits to a limited number of banks which have
realistic programmes for restoring operations. 
Russia's frozen state securities will be restructured and secondary debt
trading resumed. 
A unified system to monitor and manage Russia's state debt will be established
and include the debts of regional administrations, enterprises and banks. 
A restructured and simplified tax system will involve: 
setting profit tax at 30 percent, with 19 to 22 percent going to the regions 
uniting all budget receipts into a single account under the control of a
federal treasury 
property tax of 0.5 percent of property's market value 
higher penalties for late tax payments and tax evasion 
elimination of tax breaks for businesses and enterprises 
setting tax on a second income at 20 percent 
introduction of a less rigid, socially oriented tax system from January 1,
1999. 
From October the government will guarantee full payment of current wages and
pensions and increase demands on enterprises and individuals responsible for
timely payment of wages. 
Payment of back wages and pensions to continue into 1999. 
Price controls will be imposed on the cost of services of ``natural
monopolies'' (mostly energy suppliers) 
Shortages of medicines or food will be alleviated. 

*******

#2
Toronto Sun
October 30, 1998 
Throwing in the towel
By MATTHEW FISHER ( 74511.357@CompuServe.com) 
Sun's Columnist at Large

Moscow -- Having gambled and lost hundreds of billions of dollars, the West
has given up on Russia. 
So has Russia itself. 
From its greedy, preening elites to its threadbare masses, almost no one here
has any confidence in Russia's future. 
Boris Yeltsin, who once stood bravely on a tank and stared down a counter-
revolution, is obviously in a perpetual fog. He has only two remaining
ambitions - to stay alive and to keep his presidential perquisites, which have
now become more important to him than his presidential powers. 
Yeltsin's new prime minister, Evgeni Primakov, who once ran secret missions
to advance Kremlin interests in the Middle East, is proving himself incapable
of marshalling support for political or economic initiatives of any kind. He
cannot even form a cabinet. 
Yeltsin's most likely heirs, Yuri Luzhkov and Alexander Lebed, talk grandly
about restoring Greater Russia; but what the two would-be czars are supremely
interested in is acquiring Soviet-style powers for themselves. 
Their thinking is no different and no less wrong-headed than Yeltsin's eight
years ago, which went something like: "If I succeed, so will Russia." 
Russians of every class and background are forever telling foreigners how
patriotic they are and how they feel Russian to the depths of their uniquely
Russian souls. But few of them behave like they speak. 
Those well-connected Russians who have looted the national treasury have long
been sending their plunder overseas. This process has only accelerated since
the collapse of the ruble in mid-August. 
Before what everyone calls "the crisis," the tiny, western-oriented business
and professional cadre in Moscow - which Westerners took to calling the
emerging Russian middle class - spent a lot of their money and free time
taking holidays in southern Spain and France, Cyprus, southeast Asia or, if
they could get visas, in London or anywhere the United States. What the so-
called middle class didn't spend on travel, they spent on top-of-the-line
imported food, clothes, electronics and cars; almost anything, really, as long
as it didn't carry the stigma of having been made in Russia. 
The senior army officers, policemen and former bureaucrats who make up
Russia's stinking rich criminal class, like the rich elsewhere, are welcome in
almost any country. Although their odds of success are much longer than the
kleptocrats and outright gangsters, virtually every middle-class Russian is
also plotting a way to escape the country. Some hope to get out through
marriage. Others are counting, perhaps mistakenly, on the friendships and
associations they developed with foreigners who came to Moscow in their
thousands in the 1990s seeking their own fortunes. 
Those few young Russians still employed by western companies in Moscow spend
their work days scanning the Internet for foreign business schools to attend
or preparing their documents and spiels for American, Canadian and Australian
immigration officers. 
While lacking the limited options of the middle class and the limitless
options of the criminal class, the other 95% of the Russian population would
not behave any differently if they had the chance. 
Although Russia is nearly bankrupt, there continues to be a national mania
for anything and everything from abroad - chicken from Arkansas called "Bush
legs" (in honour of the former American president), butter from New Zealand,
soap operas from California and Brazil, even hockey sticks and skates from
Finland and Canada. 
The masses aren't going anywhere, but denied anything like their fair share
of the national spoils, they are utterly morose and totally disbelieving of
everything they have been promised by Yeltsin or are being promised by those
who would replace him. Russian pride is at such a low ebb that the Kuerile
Islanders in the Far East are begging Japan to reclaim the archipelago it lost
in World War II and let them continue to live there. 
Most Russians have given up. Rather than talking revolution they are sitting
quietly at home, rightly expecting their lives are going to get much worse. 

********

#3
Russian Government's Plan Not Enough to Boost Economy

Moscow, Oct. 30 (Bloomberg) - Russian Prime Minister Yevgeny Primakov's two-
month-old government will unveil an economic plan on Saturday that's expected
to include tax breaks for industry, printing more money to pay wages and
little that would increase revenue. 
The government has shown a draft of its program to the International Monetary
Fund, though the IMF is unlikely to resume lending until it sees a detailed
budget for next year. Unless the government's program differs radically from
proposals that have leaked since Primakov took office, it's also unlikely to
satisfy either foreign investors or Russian businesses, which are facing the
steepest economic decline in five years. 
``This will just be a mishmash of previous programs,'' said Kim Iskyan, an
analyst at MFK Renaissance in Moscow. ``How many programs has the government
already floated? I am not holding my breath.'' 
The government itself is divided on the direction it should take to try to
rescue the economy. A spokesman for First Deputy Prime Minister Yuri
Maslyukov, a communist and the former head of the Soviet-era state planning
agency, said it's possible the cabinet may not even approve the plan tomorrow.
That could mean even more delays before any action is taken. 

Muddling Through' 

``Muddling through has become official government policy and I am getting the
feeling they believe the law of gravity is optional,'' said Eric Kraus, head
of fixed income at Dresdner Kleinwort Benson in Moscow. 
The outlook for the IMF to pay another installment on Russia's $22.6 billion
in loans is dim, Kraus said. ``For political reasons, the IMF can simply not
be seen supporting an economic non-policy.'' 
The inability of the cabinet to adopt any coherent economic policy in the past
two months stems from the differences within the cabinet, which includes
communists like Maslyukov as well as free- market advocates like Finance
Minister Mikhail Zadornov, who served in the previous government. 
Maslyukov favors government measures to help domestic industry, while Zadornov
has stressed the need to increase tax revenue, and cut spending. Some members
of the cabinet also have argued that Russia should not even attempt to pay its
$2.5 billion in foreign debt payments this year or $17.5 billion next year,
deputy Finance Minister Mikhail Kasyanov told U.S. business officials in
Moscow this week. 
Primakov has pledged that Russia will pay all of its foreign debts after
defaulting in August on $40 billion of domestic debt. 

Debt Talks 

The government is in talks with foreign holders of its defaulted treasury
bonds on a plan to restructure the ruble-denominated debt by replacing it with
longer term, dollar-denominated bonds. Reaching agreement with those creditors
is key to satisfying the IMF, as well as determining the level of the
government's debt servicing costs. 
``Until we resolve the debt restructuring issue, we are unlikely to see a
government program that we can realistically asses,'' said Daniel Wolfe, chief
operating officer of Troika Dialog in Moscow. 
The government's program is likely to include lowering taxes, cheap loans and
tax breaks for state-controlled companies, and measures to prop up some banks
hurt by the government's default on its Treasury bills, which accounted for
about a quarter of all assets in the banking system. 
Those measures will be insufficient to reverse the current economic decline,
analysts said. The economy contracted by almost 10 percent in September from a
year earlier, as the ruble dropped 60 percent against the dollar in two
months, driving up prices and killing domestic demand. 

Helping Industry 

The government also is expected to try to clear debts from state- controlled
companies by allowing them the cancel out mutual debts, and use barter more
extensively. The IMF opposes both policies, though the government sees it as a
way to help companies move eventually to greater use of cash. 
``Mutual debt offsets between companies'' should be allowed, said Vladimir
Evsyukov, deputy minister of the economy, at a conference on the Russian
metals industry in Moscow yesterday. He also said the government's program
includes ``lowering of profit tax and a gradual lowering of the value added
tax.'' 
The government's planned tax cuts are not offset, however, by cuts in
spending. With no access to financing after its default, the government's only
option will be to print more money, driving up the inflation rate, already
38.4 percent in September, the biggest monthly rise in more than three years. 
``There is an expenditure increase in the budget, and tax changes have not
gone far enough'' to increase revenue, said Peter Westin, an economist at the
Russian European Center for Economic Policy. ``I expect a program that would
have to rely on'' printing money, which would ``spill over into inflation at
the beginning of next year.'' 

Canceling Debts 

The government already has promised to cancel the tax debts of a number of
large companies. The government will take 25 percent of the shares of AO
Kamaz, Russia's biggest truck producer, located in the autonomous republic of
Tatarstan, in exchange for paying some of its debts. 
Many companies attacked the government program, saying it increases state
control over the economy and stifles entrepreneurs, while giving preferential
treatment to inefficient state-controlled enterprises. 
``Each day they are increasing regulation of the economy,'' said Petr
Mostovoy, first vice president of RAO Alrosa, or Almazy Rossii Sakha, which
produces about one-fourth of the world's diamonds. ``The government's policies
are directed at stifling business.'' 
The policies that have emerged so far have paralyzed businesses that rely on
imports which have plunged as the ruble fluctuates, businessmen said. 

*******

#4
Activists warn against return to Soviet past
By Elizabeth Piper

MOSCOW, Oct 30 (Reuters) - ``Do not forget the brutality of the Soviet past,''
human rights activists cried out to Russians on Friday, warning them that the
financial crisis could usher in a new era of cruel and arbitrary rule. 
Pensioners gathered outside the former KGB security police headquarters at the
Lubyanka to light candles, lay flowers and remember relatives who perished in
Josef Stalin's labour camps, in jail or in the building towering above their
commemoration. 
``Today we remember the victims of our political leaders and we must continue
to think about all of them to prevent any return to the past,'' an activist
told an emotional crowd over a loud speaker. 
Political opposition was outlawed in the Soviet Union until the 1980s. The
state imposed severe curbs on freedom of speech, religion and travel and
police used harsh methods against any who queried the tenets of the official
Marxist-Leninist creed. 
Sergei Kovalyov, who spent years in prison under Communist rule, said he
feared a return to those days as Russia struggles with a crippling economic
crisis, which has led to a rouble devaluation, job losses and soaring prices. 
``I hope those days will not return, but it is a possibility we have to
consider during these hard times,'' said Kovalyov, ousted as President Boris
Yeltsin's human rights representative in 1995 over his opposition to the
brutal war in rebel Chechnya. 
``By remembering those we have lost, we can hopefully stop the nostalgia for
yesterday and stop any return of Soviet brutality,'' Kovalyov told Reuters. 
Russians have become increasingly nostalgic for the iron certainties of Soviet
times when at least bread was cheap and everybody had a job, despite the
absence of political freedom. 
Liberal reformer Grigory Yavlinsky and former prime minister Yegor Gaidar
joined the ceremony and laid decorated baby pine trees at the Solovetsky Stone
-- a stone which was taken from a Siberian gulag and brought to the square in
1990 to commemorate those who perished at the hands of the state in Soviet
times. 
But Kovalyov said a civil society was still a long way off for Russia, despite
the switch to democracy. 
Human rights activists have urged Russia for years to abolish the death
penalty and to protect minorities. 
``There are still closed trials, there are still state secrets and I am sure
that in the regions civil liberties are not respected,'' he said. 

******

#5
New York Times
October 30, 1998
[for personal use only]
Yeltsin Ready to Pick Constitutional Panel, Kremlin Says
By CELESTINE BOHLEN

MOSCOW -- As President Boris Yeltsin prepares to fly to a Black Sea resort on
Friday on an extended sick leave, a Kremlin spokesman said Thursday that he
would soon appoint a panel of legal experts to review changes to the Russian
Constitution, including the creation of a post for a vice president and
successor. 
Yeltsin, 67, has already stepped back from the day-to-day business of running
the country -- a fact officially confirmed this week by the Kremlin after his
latest bout of "nervous exhaustion." Now, according to his chief spokesman,
Dmitri Yakushkin, he will have the time "to plan other things," in particular
his handover of power in 2000, when his term ends. 
Comparing Yeltsin to a long-distance runner on his last lap, Yakushkin said
the constitutional review was only indirectly related to his health. "The only
connection is that Yeltsin does not get any younger with each year, and a
minor cold, given his health, has much more serious consequences," he said. 
A team of doctors ruled Thursday that Yeltsin, who has spent the last two days
at a medical center outside Moscow, is fit to fly on Friday to Sochi, a
Russian resort where he will spend a two-week vacation, the Kremlin announced
Thursday night. 
According to Yakushkin, the legal panel, made up of about 10 lawyers to be
named next month, will sort through proposed constitutional amendments that
have been floated publicly as opposition leaders press to reduce Yeltsin's
political powers, and even oust him. 
According to a poll made public on Thursday by the Public Opinion foundation,
a polling group, 75 percent of 1,500 Russians questioned said they would favor
Yeltsin's impeachment, a process that has already begun in Parliament, even
though its chances of being completed are very slight. 
Yakushkin said Yeltsin -- whose final approval is needed for constitutional
amendments -- would not consider any changes that would diminish the
considerable powers of the presidency, or cede its authority to a
parliamentary majority. 
"Nothing will be approved that makes the system of power more fragile,"
Yakushkin said in an interview, "only that which will strengthen it." 
But he said the issue of a vice presidency -- a post stricken from the 1993
Constitution after Yeltsin's last vice president tried to lead a mutiny
against him -- will be on the agenda, answering a surge of questions that have
been raised about the current line of succession. 
The proposed council will review this and other proposals, and submit its own
recommendations, Yakushkin said. The timing, he said, will depend on "the
intensity of the public discussion." 
Under the current Constitution, in the event of the death or disability of a
president, the job passes to the prime minister, who then must hold special
elections within three months. A vice president -- if a provision to create
the job were inserted into the Constitution -- would succeed a president until
the end of the regular four-year term. 
Changing the Constitution is an arduous business, involving the approval of
three-fourths of Parliament's upper house, and two-thirds of its lower house.
A constitutional assembly can also be called. A top Kremlin aide, Oleg
Sysuyev, told a Russian newspaper this week that Yeltsin would favor such a
gathering, but not if it is made up of current members of Parliament's
Communist-dominated lower house, as his opposition has proposed. 
Given the intensity of Russia's political debate and the urgency of its
economic crisis, some analysts say they doubt that there will be time for such
a leisurely procedure. 
Instead, they suggest that a proposal for constitutional revision will amount,
in fact, to an opening for political negotiations over Yeltsin's succession --
either before his terms ends or after. Few political analysts expect that the
president will retire early, except for reasons of health. 
"The issue is not the law -- it rarely is in Russia," said Otto Latsis, a
political analyst for the newspaper New Izvestia. "It is about specific
people." 
As Yeltsin's health has wavered from bad to worse in recent weeks, the
political jockeying to succeed him has stepped up, with top contenders, like
Mayor Yuri Luzhkov of Moscow, joining the chorus calling on him to resign. 
But except perhaps for Luzhkov, early presidential elections, in Russia's
current condition, are seen as a risk by many political leaders who have
instead chosen to consolidate their support for Prime Minister Yevgeny
Primakov as Russia's surrogate president. 
Primakov, who took Yeltsin's place this week at a European Union summit
meeting in Austria after doctors ordered the president to stay home, has
already assumed many presidential functions, and is expected to continue to
substitute for Yeltsin abroad. 
In interviews this week, Sysuyev said the president would no longer be as
involved as he once was in the daily operation of government. The president,
Sysuyev told a television interviewer on Monday, will no longer demand to know
"about every ruble of wage arrears." 
Instead, Yeltsin's main function will be to serve as the guarantor of Russia's
integrity, and of the freedoms of its citizens. "Maybe this two-week vacation
will help the president to think about the newly formed situation," he said. 
Yakushkin said Thursday that the president can now distance himself from
government, because for the first time in his seven years in office, he has a
prime minister who enjoys the support of a majority in Parliament's
cantankerous lower house. 
"In this situation, and given the experience of the years behind him, there
will not be any intrusion, not only in technical details but in day-to-day
economic decision," Yakushkin said. "He won't intrude in any way, which was
not the case before. 
According to his spokesman, the public pressure on Yeltsin has taken its toll.
"He is very tired, and it can be felt," Yakushkin said. "There is some
emotional stress, coming from all directions, what he reads in the press, the
attacks against him." 

******

#6
Washington Post
October 30, 1998
[for personal use only]
Regardless of Its Economic Ills, Russia 'Cannot Afford to Be Passive Abroad'
By Nora Boustany

Nobody, it seems, disagrees that Yugoslav President Slobodan Milosevic needs
international pressure to ensure that ethnic Albanian refugees can return to
safer homes in the Serbian province of Kosovo and that Serbian police continue
dismantling menacing checkpoints and barracks in the countryside.
Milosevic feels "isolated," according to a Russian official, who gave a
background briefing to Washington Post editors and reporters Monday. The
Yugoslav leader "does not only want to talk to Russia," a traditional ally,
"but also to [special U.S. envoy Richard C.] Holbrooke. Milosevic is not a
Russian satellite and it is very difficult to talk to him," he noted.
The agreement that is being implemented in Kosovo after the threat of NATO air
strikes was "only the beginning," he added, while casting emphatic doubt on
the long-term effects of actual air strikes had they occurred.
"Of course we can threaten Milosevic with air strikes but how can we
influence" the outcome for Kosovo Albanians once that happens? he asked. "If
you strike and if we strike, what would be the next move?" the Russian
official continued. "There will be more Serb refugees and we will have no
effect on Kosovo terrorists [seeking the independence of Kosovo]." At the same
time, "it is very important to push Milosevic to pull his troops out," he
added.
The Russian official reiterated Moscow's opposition to the expansion of the
North Atlantic Treaty Organization closer to Russian borders but maintained
his country was not in a position to dictate policy to other states on this
issue. "We are against it and we do not consider it a good idea. The Warsaw
Pact disappeared, Russian troops were withdrawn from Europe, and NATO is still
expanding," the official noted.
Russia's economic woes, however, should not lead others to write it off on the
world scene, he added. "We cannot afford to be passive abroad even if we are
in economic dire straits because we have interests," the Russian official
said. Security and stability in Europe are closely connected to Russia's
interests, he added, because "we want the region to be stable so we can sell
our products."
Holbrooke made an interesting observation during a briefing at the State
Department Wednesday afternoon.
Foreign policy is not architecture, a science where you plan to the last nut
and bolt how things will come out, he told journalists in a briefing on what
has been achieved in Kosovo. "Foreign policy is more like jazz, with
variations on the same theme and you change as you go along," he explained,
stressing that developments unfolding there and the goals set for monitoring
the agreement he helped negotiate were "a work in progress. History will
decide how this movie comes out." So, everybody is watching closely.

******

#7
Primakov Tops Popularity Ratings

MOSCOW, Oct 28 (Interfax) - Prime Minister Yevgeniy Primakov enjoys
the greatest public confidence among Russia's politicians, with 14% of the
public trusting him.
The All-Russia Public Opinion Center conducted a poll of 1,608
Russians October 23-26. The respondents were asked to name only
onepolitician.
Primakov is followed by Communist leader Gennadiy Zyuganov with 10%,
Yabloko movement leader Grigoriy Yavlinskiy and Moscow mayor Yuriy Luzhkov
with 7% each, and Krasnoyarsk governor Aleksandr Lebed with 5%.
Some 30% refused to name anyone, and the rest were either undecided
(12%) or named politicians who collected fewer votes than the statistical
error of such polls (4%).
When the same persons were asked to name several politicians whose
actions and statements of the previous two weeks had been most memorable,
Primakov topped the list with 23%.
He was followed by Zyuganov with 11%, Luzhkov with 10%, and Liberal
Democratic Party leader Vladimir Zhirinovskiy, Yavlinskiy and Lebed with 7%
each. No other politician cleared the 4% barrier.
Another 24% of the participants said they couldn't remember the
actions of any politician, and 21% were undecided.
However, when those polled were asked whom they would vote for if
presidential elections were held the following Sunday, Primakov came in
fifth with 4%. Zyuganov ranked first with 12%, Luzhkov second with 10%,
Yavlinsky third with 8% and Lebed fourth with 7%.
Twelve percent said they would not vote at all, 32% were undecided and
the rest named other candidates.

*******

#8
The Economist
October 31, 1998
[for personal use only]
EUROPE 
Russia 
Masterly inactivity 
M O S C O W 

WITH an ever-frailer President Boris Yeltsin “resting” in a sanatorium
outside Moscow, power is passing ever more visibly to Yevgeny Primakov, his
prime minister. Not that power amounts to much in Russia these days. Mr
Primakov went to Vienna this week to try to persuade European Union leaders
that his government had Russia’s economy under control. That was far from
true—though it did not deter Austria, the EU’s current president, from urging
the IMF, which also held talks with Russia this week, to shell out other
people’s money for Russia once again. The government has indeed said some
quite sensible things. But add up the deeds, and there are many more minuses
than pluses. 
One large example: the plan to save the banking system, which collapsed in
August, taking with it all hopes for economic recovery. The plan states that
only 15 banks are important enough to be saved; other insolvent ones must
close. Fair enough—but which 15? Before the plan was even agreed on, let alone
implemented, 13 were bailed out in one way or another. That, coupled with
Russia’s poor record of banking supervision, suggests that bail-outs will be
plentiful and bankruptcies few. 
Or take the biggest point in the government’s favour: that it has not printed
money as quickly and eagerly as at first feared. Only a few important—or, at
least, threatening—groups, such as some soldiers, have had their wage arrears
met in full. But the day of reckoning has merely been postponed. The
government’s budget for the fourth quarter shows tax revenues at only half the
planned expenditure—and this is the optimistic forecast. The gap is to be
filled by printing 20 billion roubles (about $1.2 billion): the rest, 45
billion roubles, is to come from “foreign borrowing”. 
Raising money abroad, however, still seems wishful thinking. Russia’s tactics
with the IMF have been to threaten to print money and default on even more
foreign debt unless help comes fast. This has been singularly
unsuccessful—like putting a gun to your own head and saying “Give me the money
or I shoot,” as one banker puts it. Russian leaders tell foreign politicians
that multinational companies, deprived of their export markets by the economic
crash, will put pressure on the West to provide yet another bail-out. Like
many Russian beliefs, this is more comforting than reliable. 
Foreign borrowing will probably mean borrowing from the central bank’s hard-
currency reserves—in effect, printing money. If the government decides not to
do this, for fear of stoking hyperinflation, it will have no choice but to
borrow from ordinary Russians: arrears to pensioners and most state employees,
despite government promises to the contrary, will continue to pile up. 
Odd, therefore, that so little criticism is levelled at Mr Primakov, and so
much at Mr Yeltsin, whose failings now are chiefly physical: he is ill and
muddled. It may be that Russians are simply relieved that somebody is running
the country, however wrong-headedly. That somebody, these days, is Mr
Primakov, not Mr Yeltsin. Indeed, the president’s own men now say as much, and
there are growing calls in Moscow for him to resign. So far, Russia has
muddled through the seven weeks since Mr Primakov was installed. But the price
of muddling through, in terms of disintegration and poverty, looks ever more
fearful. 

******

#9 
Muscovites Call Ailing Yeltsin an Embarrassment 

MOSCOW, Oct. 29, 1998 -- (Reuters) Muscovites interviewed on Wednesday
showed little sympathy for President Boris Yeltsin's latest bout of ill
health, saying the leader had become the country's leading embarrassment. 
"Yeltsin brings shame on our country, he should go, we need a younger
president, someone who will do something," said Katya Veronina, a former
architect. 
Veronina, who said she had little hope of finding another job, said she
hoped he would keep off the political stage and remain at the Barvikha
sanatorium where he moved on Tuesday. 
The 67-year-old leader, whose unsteady recent performances were capped by
the cancellation of a trip to Austria this week, was recovering at the
suburban center from what doctors say is fatigue and high blood pressure. 
Anatoly, 74, a pensioner and war veteran who declined to give his surname,
danced to techno music playing in a nearby kiosk to show how a healthy old
man could move. 
"Of course Yeltsin should go. For God's sake, I'm older than him and I can
still move. He can't walk -- what kind of president is that?" he said. 
Yeltsin staggered and nearly toppled over during a visit earlier this month
to Central Asia. 
While several Muscovites interviewed called for Yeltsin's resignation,
people were not sure about the rising star of Prime Minister Yevgeny
Primakov, who took Yeltsin's place at Tuesday's talks in Vienna with the
European Union. 
"I have no opinion on him. I have not got a clue what he's done or what he
stands for," said Olga Mikilina, 21, a student at a foreign languages
institute. 
Most people said they thought the 68-year-old spymaster was a clever man
because of his frequent visits abroad as foreign minister. 
"Primakov seems to be a competent politician," said Victor Yuzhkov, 64. 
But Yuzhkov, who called all present-day politicians thieves, was not
convinced that Primakov, who took office in September, would improve the
living standards of most Russians. 
"What has he done? The country still gets worse and worse," he said.

******

#10
Chicago Tribune
October 29, 1998
[for personal use only]
IMMIGRANT SEEKING DONATIONS TO AID NEEDY IN FORMER SOVIET UNION
By Lynn Van Matre
Tribune Staff Writer

For many people, the economic woes sweeping the former Soviet Union represent
just one more crisis in a world seemingly riddled with trouble spots. But for
Naperville resident Marina Fink, the headlines about Russia's financial
collapse hit close to home.
"I was born in Azerbaijan in the Soviet Union," explained Fink, who came to
America as a child with her parents 18 years ago and now works as an office
administrator in Geneva. "We have family members that travel back and forth to
Russia. . . . What is happening there shocks me.
"Since the devaluation of the ruble, thousands have seen their earnings
disappear, and many children are being abandoned in orphanages or elsewhere
because their parents have no money for food or medicine," Fink said. "I work
in a doctor's office, and that gave me the idea that maybe I could collect
medicine and other things to send to Russia."
With the support of her employer, Geneva neurologist Steven V. Lekah, Fink
initially sought donations from the medical community but now has broadened
her appeal.
"I've already sent over a couple of bags of medicine and clothes, but it's
just a drop in the bucket," said Fink. "I'm hoping that people will donate
toys, powdered milk, dried food and warm winter clothes and boots for children
and adults."
Donated goods will be shipped to Russia at no charge by a Glenview-based
export company headed by another native of the former Soviet Union. Boris
Lake, president of U.S. Tech International, which exports juice concentrates
to Russia, said he was confident that donated goods would reach the needy in
orphanages and elsewhere. In the past, relief supplies to Russia have ended up
in the black market.
"Because we are involved in trading with Russia, I work with government
agencies there and go there myself sometimes," Lake said. "I will make sure
that the donations end up in the right channels."
According to the International Federation of Red Cross officials, the coming
winter is expected to be one of the harshest that many Russians have faced in
a generation.
In addition to financial and political turmoil, Russia and neighboring
countries have suffered from poor potato and grain harvests due to floods,
fires and droughts. By Red Cross estimates, 70 million people in Russia and
neighboring Belarus, Ukraine and Moldova are believed to be living below the
poverty line. Russian Red Cross assessment teams recently reported that in
some areas, up to 70 percent of children were physically underdeveloped.
"Here in America, people who need medicine or clothes or shelter can get help,
but over there it's a lot different," Fink said. "I plan to keep doing this
until people stop bringing in donations."
Donations may be dropped off at Lekah's office at 302 Randall Rd., Suite 304,
in Geneva. For more information, call Fink at 630-208-7735.

******

#11
Russia says its Caspian oil route still possible

MOSCOW, Oct 30 (Reuters) - Support by Turkey and four neighboring states for a
Caspian oil pipeline bypassing Russia does not mean the Russian route has been
definitely excluded, Russian officials said on Friday. 
``We believe that the economic conditions proposed by the Russian side are
optimal and we hope the companies will take a decision in our favour,'' Oleg
Rumyantsev, spokesman for the Fuel and Energy Ministry, told Reuters. 
Turkey, Azerbaijan, Uzbekistan, Kazakhstan and Georgia signed on Thursday a
declaration of support for a pipeline from new oil fields in the Caspian Sea
to the Turkish Mediterranean port of Ceyhan. 
But the key decision on feasibility will be taken by a consortium of 12
companies -- the Azerbaijan International Operating Consortium (AIOC) which
is expected to make its recommendations on the main export route in November. 
The 1,080-mile (1,730-km) Baku-Ceyhan pipeline is considered to be the longest
and most expensive of three possible routes to deliver Caspian crude to world
markets. 
The others are to the Georgian Black Sea port of Supsa, and to Russia's main
oil port of Novorossiisk also on the Black Sea. 
Russian Foreign Ministry said the Ankara declaration was purely political and
should not influence AIOC's final decision. 
``We believe this important question must be decided on the basis of a
comprehensive analysis of economic efficiency, legal guarantees and ecological
safety of the project,'' a spokesman quoted Foreign Minister Igor Ivanov as
saying in Ankara. 
``It is inadmissible to decide this question to the detriment of Russia's
interests,'' he added. 

******

#12
From: "Peter D. Ekman" <pdek@co.ru>
Subject: re:Moore and Carter
Date: Fri, 30 Oct 1998 

re:Capitalism didn't ruin Russia (JRL 2453)
Does anybody know the ultimate source of the following "information" put
forward by Moore and Carter?
"Polls now indicate that a majority of Russians would favor a return of the
communists if an election were held today."
It looks strange to me, with Zyugonov being supported by only about 20% in
the polls published on NTV.

******

#13
Moscow Times
October 30, 1998 
Sailors Put Their Subs Up for Adoption 
By Andrei Zolotov Jr.
Staff Writer

Captain Viktor Andreyev is relieved: He just received a truckload of
vegetables from his hometown in southern Russia and now his subordinates on a
strategic nuclear submarine, which carries 16 ballistic missiles to sea, will
have some food to help survive the arctic winter. 
"I have meagerly provided for my crew," he said by telephone from the Northern
Fleet base in Skalisty, in the Murmansk region. "Officers' families will not
be hungry, for which I thank my fellow townsmen in Bryansk." 
With the bankrupt Russian government unable to provide for its armed forces,
commanders are reviving the system of shefstvo, or patronage, to satisfy the
basic needs of their soldiers and sailors. 
In tsarist times, members of the imperial family became the patron of a
regiment or ship. The system was maintained under the Soviets, with Komsomol
organizations adopting military units. 
Now, commanders are continuing the tradition by forging ties with a region or
city willing to donate anything from food to construction materials or even a
VCR. 
Andreyev said that three years ago his division commander gave an assignment
to all captains as they headed home for vacation: to find patrons for their
ships. 
So when Andreyev went to his native Bryansk last year, he met with regional
Governor Yury Lodkin and other local officials and invited them to visit the
base, which is north of the Arctic Circle and 100 kilometers from the
Norwegian border. 
When a group of Bryansk city officials arrived at Skalisty last October they
were shocked by the condition of the sailors' barracks on shore and by the
number of ships rusting in their docks. 
"My eyes popped out of my head," said Igor Kaplunov, deputy chairman of the
Bryansk city council and a retired strategic rocket forces officer. 
While Andreyev's Delta 4-class submarine is one of most combat-ready in the
fleet, the crew's barracks had bare walls and no basic furniture such as
stools, Kaplunov said in a telephone interview from Bryansk. 
The city council shipped $10,000 worth of goods to Andreyev: construction
materials for the renovation of the barracks, as well as furniture, a
computer, VCR and videocassettes for sailors to watch at sea. Andreyev boasted
that with the donated materials, he was able to turn the barracks into the
best on the base. 
Two other submarines in Skalisty were adopted by Tula regional Governor Vasily
Starodubtsev and they were renamed last year: one to "Tula" and the other to
"Novomoskovsk," an industrial town in the region south of Moscow. 
This gave Bryansk authorities an idea, and earlier this year Andreyev's K-117
became "Bryansk." 
The latest call for help was for food. Although sailors are fed pretty
decently by Russian army standards, Andreyev said, officers, who make up two-
thirds of his 145 men, were last paid in July and most of them couldn't even
leave the arctic town for vacation. 
At 10 rubles a kilogram, even potatoes were out of the officers' reach, the
captain said. 
Earlier this month, a truck with about 20 tons of potatoes, cabbage, carrots
and beets arrived in Skalisty from Bryansk. 
Alexander Blakitny, chairman of the Bryansk city council, said that while it
is the duty of the federal government to feed the armed forces, Bryansk is
happy to help the submarine that bears its name. 
"We are also poor today, but these are our guys anyhow," Blakitny said. "We
consider it our duty to help them as much as we can." 
The city government gathers the supplies for the sailors from local companies
that have no money to pay their taxes, Kaplunov said. In exchange for erasing
their tax debts, the companies provide goods for Andreyev's submarine. 
Just as the "shefstvo" once was for Russia's grand dukes and duchesses, the
new patronage system is a matter of prestige for Lodkin. 
He and Governor Yury Yevdokimov of the Murmansk region, where the fleet is
based, have their seats next to each other in the Federation Council,
parliament's upper house, and they often speak about the "Bryansk" submarine,
Blakitny said. 
Other ships in the fleet also have patrons. Andreyev said the Belgorod region
is helping another ship in his division. Moscow Mayor Yury Luzhkov is
supporting the construction of a Northern Fleet submarine that bears the name
of Moscow founder Yury Dolgoruki. 
When President Boris Yeltsin attended naval exercises last summer on board the
Peter the Great missile cruiser, he disappointed sailorsby not announcing that
he would become the flagship's "shef." 
While the lack of support from the federal government is a heavy blow to the
military's morale, the help from the regions shows servicemen they are not
completely abandoned. 
"They don't let our spirits drop," Andreyev said. "People understand that at
least someone cares about them." 
But although Andreyev and his fellow commanders are genuinely grateful to the
help they get from towns in Russia's heartland, they would much rather receive
proper supplies from the federal government. 
"I am a ship commander and begging is not one of my responsibilities," the
captain said. "But what can I do?" 

*******

#14
Zyuganov on 'Various Ways' of Electing Russian President 

MOSCOW, October 27 (Itar-Tass) -- Gennadiy Zyuganov, the leader of the
Russian Communist Party, said on Tuesday he does not rule out various ways
of electing Russian president, also at a meeting of electors.
Commenting at the request of Tass on the proposal of upper house
speaker Yegor Stroyev that president be elected at a constitutional
assembly or voters, Zyuganov told a news conference at the office of
Argumenty I Fakty weekly he does not rule out any way of elections,
depending on the situation in the country.
If there were a guarantee of fair elections, they would be
inexpensive, "but the present Russian elite would not face that," the
Communist leader said. "I would conduct presidential elections at a meeting
of electors representing every region, every ethnic group, all strata,"
Zyuganov said. The meeting would be representative, and the elected person
would be responsible to the meeting.
Zyuganov believes the institution of vice-presidency is possible in
Russia but added that, on the whole, presidential power in the form it
exists in Russia now is "something alien to Russia."
Zyuganov believes the government's presidium and both parliamentary
houses should reach agreement to adjust the executive authorities, putting
them under the control of the legislative authorities. He believes all
this can be done by a constitutional assembly.

******




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