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Johnson's Russia List


November 18, 1998   
This Date's Issues: 2482  

Johnson's Russia List
18 November 1998

[Note from David Johnson:
1. AFP: "Teflon" Primakov Rides High in Polls, Despite Crisis.
2. Reuters: OECD sees GDP slide, inflation leap for Russia.
3. Christian Science Monitor editorial: Don't Give Up on Russia.
4. The Independent: Phil Reeves, Russian spies 'running protection 

5. Fred Weir on Duma impeachement hearings.
6. Los Angeles Times: Maura Reynolds, It's Payback Time for Russian
Banks--or Else.

7. Philadelphia Inquirer: Dave Montgomery, Russian extremists train 
new generation. (Barkashov).

8. NTV: Makashov Gives Further Comment on Anti-Semitic Remarks.
9. RFE/RL: Floriana Fossato, Russia: 'D-Day' For Banks Has Arrived.
10. Rossiyskaya Gazeta: 'Psycholinguist' Profiles Berezovskiy.
11. Interfax: Russian Citizens Favor Keeping Presidency.
12. Interfax: Over 50% of Muscovites Condemn Makashov Remarks.]


"Teflon" Primakov Rides High in Polls, Despite Crisis 

MOSCOW, Nov. 17, 1998 -- (Agence France Presse) The
economy has imploded. The ruble is losing weight. Hyperinflation is
predicted for the winter while food and fuel is running out. And yet the
most popular Russian is the man running the country -- Yevgeny Primakov.
Confirmed as prime minister just two months ago, Primakov despite delaying
the launch of an emergency economic rescue package until Sunday has fast
become Russia's favorite would-be president. 
Some 38 percent of Russians questioned said they approved of his work,
according to the latest poll by the Public Opinion Foundation, not a low
figure when compared to ailing President Boris Yeltsin's tiny 3 percent
Polls say Primakov would beat any contender he could possibly face in a
presidential runoff. Even his potential rivals, like Moscow Mayor Yury
Luzhkov and the tough-talking Aleksander Lebed, say that they like him. 
Russian opinion polls are never an exact science and are often manipulated
for best results. But conventional wisdom suggests that the former
spy-master has struck a chord with weary Russians as he slowly goes through
the motions of rescuing the country from collapse. 
"Primakov's prescription to any ailment is a warm bed and soup, not painful
medical shots. The patient may die as a result, but psychologically it
works," said Sergei Markov of Moscow's Institute of Political Studies. 
"He does not impose strict regimes, and Russians like that. People have
grown tired of radical government ideologies," Markov said. "Plus, he never
gets into fights." 
Primakov's center-left coalition government was crafted following Russia's
August financial crash that swept away ex-premier Sergei Kiriyenko and his
young, liberal team. 
The ruble has since shed 60 percent of its value while Russia lost its
International Monetary Fund lifeline. Food and fuel shortages that followed
weeks of government paralysis have forced people living in far-flung North
and Far East regions to start fleeing their villages for the warmer south
this winter. 
But Primakov has encountered almost no resistance from either the vocal
Russian media nor the usually rowdy lower house of parliament -- something
difficult to imagine for his predecessors. 
"Today people think they need stability more than they need long-term
decisions, decisions that Primakov is not very good at," said Yevgeny Volk,
director of Moscow's Heritage Foundation. 
"He makes an impression of a reasonable, serious man," Volk said. "But he
is a master of propaganda and agitation. I would not put it past him if he
commissioned those opinion polls himself." 
Analysts credit part of Primakov's success to his guarded secrecy. A
general who served with Primakov during his days as Russia's chief counter
intelligence officer is also his current chief of staff. 
One well-kept secret is just how many rubles the government printed in
recent weeks to help keep its promise of paying wage arrears, investing in
devastated industries and protecting a select group of ruined banks. 
Western economists warn that a large emission of unbacked rubles may spell
hyperinflation by January. The government has floated several contradictory
Some further attribute Primakov's political success to his ability to find
compromises within his Cabinet. But analysts fear that virtue may soon turn
into his gravest fault. 
"This government's chief problem is not that it will make mistakes but that
it is unable to accomplish anything," said Yury Korgunyuk of the INDEM
research institute. 
"Running a country is not the same as winning a beauty contest. His
inactivity and his compromises will force the ground to sink under his
feet," Korgunyuk said. "Besides, Primakov has never been elected to
anything in his life."


OECD sees GDP slide, inflation leap for Russia

PARIS, Nov 17 (Reuters) - The outlook for crisis-hit Russia is very
uncertain with its economy expected to shrink further next year amid soaring
inflation, the Organisation for Economic Cooperation and Development (OECD)
said on Tuesday.
The Paris-based body warned in its twice-yearly Economic Outlook that the
ex-Soviet nation could lose the progress it had made towards market reforms
if it introduced more state control.
However, the introduction of responsible financial policies, linked with
a strengthening of the current account and lower domestic debt servicing
charges, could lay the foundation for some stability in 1999, it said.
``The outlook in Russia is highly uncertain at the present time,'' it said.
The OECD forecast that Russia's gross domestic product (GDP) would fall
six percent this year and next before edging up by one percent in 2000.
It forecast inflation of 70 percent in 1998, rising to 150 percent next
year before edging back to 80 percent in 2000.
It said that a high potential for instability existed in the short term
but that prospects for 1999 and the medium term depended on the government's
policy choices.
It said that if the government chose simply to issue money to support
incomes and the crisis-hit banks then an inflationary spiral could be sparked.
``If price controls and administrative planning were to be introduced on
a large scale to deal with such a situation, Russia could stand to lose the
years of progress towards market reform and institutional development in the
1990s,'' it said.
``On the other hand, if responsible financial policies are put in place,
the significant strengthening of the current account, combined with new
prospects for fiscal consolidation due to lower domestic debt service, could
provide the foundation for achieving some degree of stability in 1999,'' the
OECD added.
It said imports would be hit by the crisis, meaning the current account
could return to balance by the end of the year. This may be helped by the
weaker rouble encouraging exports but increased taxes and controls could
weaken this response.
``The overall disruptive effects of the current crisis, combined with
weakened domestic demand, are expected to lead to a further decline in GDP
in the fourth quarter of 1998,'' it said.
The OECD added that the government faced a ``fundamental policy
challenge'' in restructuring and rebuilding the bank sector, brought to its
knees by the financial crisis.


Christian Science Monitor
November 18, 1998 
Don't Give Up on Russia 

The economic news from Russia continues to be gloomy. Prime Minister
Yevgeny Primakov's government recently announced it won't be able to pay its
foreign debts next year. The Finance Ministry projects that, at best, the
economy will shrink 3 percent next year on top of the 5 percent it has
contracted in 1998. Worse, it could slide 9 percent.
Reports say Russian soldiers are on short rations. The Russian Far North
faces the prospect that it won't be able to import the fuel and food people
need to survive the winter.
With the worst grain harvest in 45 years, the government has asked the
United States and the European Union for food aid. The US will send $600
million worth and the EU $480 million. Each must insist that food actually
reaches hungry Russians and does not enrich corrupt officials or companies
that reexport it for profit. 
But at a deeper level, the Russian government must realize that its
proposals to print more rubles and expand state intervention in the economy
are not the answer to Russia's troubles. Both prevent the International
Monetary Fund from providing the kind of aid that could move things in the
right direction. Both will make things worse, feeding hyperinflation, waste,
and increased inefficiency.
Russia needs a realistic budget, a simplified and fairer tax system,
reliable tax collection, and a system of business and investment law. Its
government must help legislators and public understand that foreign
investment is normal and helpful, not to be feared, resisted, or ashamed of.
The West's greatest fears for Russia now are that it will relapse into
overcentralized authoritarianism or split into fiefdoms possessing nuclear
weapons. Neither need happen.
There are, indeed, hopeful signs in the gloom. Younger Russians who
represent the future show a much greater understanding of both democracy and
market economics. Russians are not flocking back to the Communist Party.
Increased federalism can boost economic progress by eliminating inefficient
central bureaucracy.
The West should not abandon Russia. A better policy is patient engagement
on many levels and constant assurance to Russians that the West cares about
their welfare.
Russia and the West continue to cooperate on a whole range of issues.
It's particularly in the West's interest, as well as Russia's, to continue
security cooperation such as the Nunn-Lugar program, in which the US helps
former Soviet states destroy nuclear weapons under arms-reduction treaties.
That program has deactivated 4,838 warheads aimed at the US.
Contrary to the empty theories of ex-Soviet apparatchiks and nationalist
romantics, there is no "Russian" way separate from "Western" economics.
There is only economics. When enough Russians understand that, they will
take the steps Russia needs to leave the current crisis behind.


The Independent
18 November 1998
[for personal use only]
Russian spies 'running protection rackets'
By Phil Reeves in Moscow 

RUSSIA'S SECRET service, successor to the KGB, is being used to carry out
assassinations, seize hostages and extort money from big business, agents
have claimed. 
In an extraordinary public appearance, Federal Security Bureau (FSB)
officers said the agency was being used "to settle accounts with undesirable
persons, to carry out private political and criminal orders for a fee, and
sometimes simply as an instrument to earn money". 
The men, several wearing reflective sunglasses and one clad in a black
balaclava, unveiled their allegations at a press conference in Moscow,
plunging the agency into one of its more serious, and mysterious,
post-Soviet scandals. 
"Our aim is to draw public attention to the deviations in the work of the
Federal Security Bureau that are exceedingly dangerous for society and which
have become features of its activities," they said in a statement. 
"We do not want the shadow of the criminal actions of a number of
officials to be cast on the service and its honest officers." The statement
was signed by two colonels, two majors and a senior lieutenant. 
Security officers publicly attacking their bosses is unheard-of in
post-Soviet Russia, and immediately dominated television news headlines,
casting a shadow over the meeting in Moscow between President Boris Yeltsin
and the German Chancellor, Gerhard Schroder. 
In recent years, reports have regularly linked organised crime and the
FSB, which has suffered from low morale, poor pay and a brain drain,
following the break-up of the far larger KGB. Thousands of ex-KGB agents
have taken paid jobs in the shady world of Russian business and banking. 
Some media reports have linked FSB elements with contract killings,
bombings and hostage-taking. But this is the first time that officers,
apparently from the heart of the security system, have so openly spelt out
allegations of top level corruption. 
They acknowledged that they risked reprisals. "We were told, 'we will
first boot you out of the service and then stifle you like pups'," said
Lt-Col Alexander Litvinenko. 
The most dramatic revelation has been the men's claim that a senior FSB
officer ordered the colonel to kill Boris Berezovsky, one of Russia's top
business and media magnates, who played a leading role in releasing two
British hostages in September. Lt-Col Litvinenko, Mr Berezovsky's former
bodyguard, claimed he did not carry out the order, which he received last
December, because he regarded it as illegal. 
The colonel said as a result he was assaulted, received death threats and
was threatened with prosecution. In May, media reports accused him and his
colleagues of being involved in murders, assaults, torture and extortion. 
Lt-Col Litvinenko claimed one FSB officer also accused him of "preventing
patriots from the motherland from killing a Jew who robbed half his
country". Mr Berezovsky has Jewish roots, an issue that has acquired
significance because of the resurgence of anti-Semitism in Russia. 
Another officer, Major Andrei Ponkin, yesterday claimed that in late 1977
the FSB leadership planned to kidnap the brother of a prominent Moscow
businessman, Umar Dzhebrailov, Hussein, then take him to a country house.
"In case of resistance ... we were ordered to kill the policemen who guarded
him and then kill him, as one of the options," he said. The order was never
carried out. 
The agents argue that these were not isolated incidents. "The order to
assassinate ... Berezovsky, unfortunately, is not an exceptional event in
the present life of the FSB," said their statement. 
The director of the Federal Security Bureau, Vladimir Putin, has
confirmed that Russia's chief military prosecutor's office is investigating
the Berezovsky case. But he has also threatened to sue accusers if their
claims prove groundless. 
The officers have stressed the director is not their target and the
agency's problems began under his predecessor, General Nikolai Kovalyov. 


Date: Tue, 17 Nov 1998 
For the Hindustan Times
From: Fred Weir in Moscow

MOSCOW (HT Nov 17) -- Russian parliamentary hearings to
impeach President Boris Yeltsin are drawing to a close, with
commission members saying there is enough evidence to send the
process to the next stage.
"The commission has already heard enough to indict President
Yeltsin for treason and other serious crimes," says Vadim
Filimonov, the Communist chairman of the committee that has spent
5 months investigating the case for impeaching the 67-year old
Kremlin leader.
"The commission will finish its work by the end of this
month, and put its findings before the parliament. This procedure
may be slow, but it will not go away."
The hearings are a long-shot attempt by the parliament's
opposition majority to bring President Yeltsin down using the
rules of his own Constitution.
That document, authored by Mr. Yeltsin after he dispersed
the leftist legislature in 1993, concentrates almost all power in
the Kremlin and makes it exceedingly difficult to impeach a
sitting President.
In order to open the process of impeachment, the lower house
of parliament -- the Duma -- must draw up an indictment showing
the President committed high treason or another grave crime, and
pass it by a two-thirds majority. It must be subsequently
approved by the Supreme Court and then be endorsed by a two-
thirds majority in the upper house of parliament.
Most analysts dismiss the impeachment hearings as a
political sideshow organized by the Duma's largest party, the
Communists, which has virtually no chance of succeeding.
But the commission, its members drawn from parliament's
seven main fractions, has quietly persevered since its formation
last June.
Over the past 5 months it has gathered evidence to support
charges that Mr. Yeltsin committed treason by conspiring to
illegally disband the Soviet Union in 1991; that he abolished the
national Constitution and destroyed the legitimate parliament in
a 1993 power struggle; that he made war on his own people by
attacking the secessionist republic of Chechnya from 1994 to
1996; and that he brought about the collapse of Russia's armed
While it may have little chance of ultimately succeeding,
some analysts argue the impeachment threat has done much to shape
Russia's current political agenda -- and it could move to the
front burner if the country's economic and social crisis worsens
this winter.
"The impeachment hearings are part of a political campaign
against Yeltsin, and they are becoming more important as the
President's position weakens," says Andrei Piontkovski, director
of the independent Centre for Strategic Studies.
Opinion surveys show that over 60 per cent of Russians
personally blame Mr. Yeltsin for the dire state of the country
and just as many favour his early resignation or impeachment.
It seems likely that the impeachment process will gather
momentum as it moves to the next stage. Although most points of
the indictment are unlikely to win sufficient support in the
Duma, both the Communists and the liberal Yabloko party will back
the charge that Yeltsin murdered tens of thousands of Russian
citizens in the bloody two-year conflict in Chechnya.
"The charges concerning the war in Chechnya are profound and
very relevant. They could well receive a two-thirds majority in
the Duma," says Mr. Piontovski.
"It's also probable that the Supreme Court will approve the
case, because the Duma's lawyers have been extremely meticulous
in preparing it."
However, it seems unlikely that in the present political
climate the upper house, which is composed of regional governors,
would back the impeachment bid.
Duma deputies say they may take some time to consider the
indictment, and voting may not take place until late winter or
even spring.
"This is not a matter to rush. It will continue until it
reaches its logical conclusion," says Yuri Ivanov, a Communist
"Impeachment is a national discussion as well as a judicial
process. The President will be brought to justice for destroying
his own country."


Los Angeles Times
November 17, 1998 
[for personal use only]
It's Payback Time for Russian Banks--or Else 

MOSCOW--It's open season on Russian banks. 
A government-imposed moratorium intended to protect Russian banks from
their foreign creditors ended Monday. From now on, they must either pay
their debts or be forced into bankruptcy. 
The expiration of the deadline is a turning point in Russia's
financial crisis. In the coming weeks and months, Central Bank officials
say, about half of the country's 1,500 banks may collapse. 
"There is no doubt that there will be trials, arrests,
investigations," Alexei Mareichev, head of the securities department at
Gazprombank, told the Kommersant Daily newspaper. "The only question is how
aggressive the Westerners will be." 
On Aug. 17, when the Russian government announced it could no longer
afford to prop up the national currency, it also imposed a 90-day
moratorium on payments of billions of dollars in private bank debt owed to
As a result, Western creditors have had to bide their time for the
last three months, talking to the banks about how and when they might pay
up. As of Monday, if the banks aren't making good on their debts, the
creditors can file suit and perhaps seize assets held outside Russia. 
Economist Otto R. Latsis, editor of the Noviye Izvestia newspaper,
said the fate of many commercial banks is in the hands of their creditors. 
However, few Russians outside the banking sector are likely to shed a tear.
The reason is that the vast majority of the institutions threatened by
bankruptcy are not banks in the Western sense. Instead of holding money for
depositors, most of them are little more than currency speculators. The
pain is likely to be limited to the banks' owners and employees. 
"A lot of these banks shouldn't have been in business to begin with,"
said Charles Ryan, president of the United Financial Group investment firm. 
Much of the money owed to Westerners is from forward currency
contracts--agreements to provide a certain amount of dollars for a certain
number of rubles at a specific date in the future. Westerners who bought
ruble-denominated government treasury bonds simultaneously bought such
contracts so they could be assured of converting their earnings back into
dollars at a favorable rate on the day the treasuries matured. 
But the sharp devaluation of the ruble since August--from about 6 to
more than 16 to the dollar--means that few of the banks have adequate
dollars to fulfill the contracts. And they may call in debts from other
banks, causing a ripple effect throughout the banking sector. 
Not all those bankrupted will be allowed to collapse. The Central Bank
is preparing to rescue banks considered too valuable to fail--those with a
large number of customer deposits, or those deemed too critical to regional
economies. The Central Bank has said 18 banks are on the list. 
Sergei L. Loiko of The Times' Moscow Bureau contributed to this report. 


Philadelphia Inquirer
12 November 1998
[for personal use only]
Russian extremists train new generation
One leader plans to run for president. But he sees
force as an option for taking over.
By Dave Montgomery

STAVROPOL, Russia -- The drill instructor is only 15, but in the Russian
Knights, youth is no barrier to commitment.
On a late Saturday afternoon on a barren field south of Stavropol, in the
south of Russia, Nikolai the drill instructor is showing five obedient
teenage recruits how to fall while carrying dummy Kalashnikov rifles. A
few hundred yards away, other fatigue-clad youths are scaling their way
out of a 20-foot-deep excavation under the watch of an off-duty Russian
military officer.
The Knights are the youth wing of Russian National Unity, the country's
most militant ultranationalist party, whose modified swastika emblems,
black uniforms, and raised-arm salutes strike a discordant tone in a
nation where Adolf Hitler's aggression claimed 20 million lives a
half-century ago.
Extremist groups such as Russian National Unity remain far outside the
mainstream of Russian politics. But many of the same ingredients that
fostered Hitler's rise from obscurity in Weimar Germany -- rampant
inflation, unemployment, widespread poverty, national humiliation, and a
weakened political leader -- are abundant in Russia, providing ample fuel
for extremism.
In a radio address last summer, President Boris N. Yeltsin, now ailing
and the target of much of his country's anger, warned that fascism
"is rearing its head" in Russia, fanned by groups that are
"using lofty words about the revival of Russia and its national
spirit as a cover."

'It's the ideology'

"There is an electoral niche for these people," said Nikolai
Petrov, of the Carnegie Endowment for International Peace's Carnegie
Moscow Center. "There is a strong feeling that the nation is
humiliated by what's going on. And there are a lot of voters who lost
almost everything, who will support anybody challenging this feeling of
national humiliation."
"A few thousand armed and ideologically prepared people always
manage to beat a multimillion-people majority," said Yevgeny
Proshechkin, founder and chairman of the Moscow Anti-Fascist Center,
which closely follows Russian National Unity's activities. "It's not
the numbers that are dangerous. It's the ideology."
Russian National Unity is frequently described as the best-organized of
Russia's radical nationalist groups, with a wide following among those
most familiar with armed force: the army, the police, and the Federal
Security Service. The Russian news media have estimated its membership at
100,000, but the party may be betting that, someday, numbers will matter
less than firepower and military skills.
Russian National Unity was founded eight years ago by Alexander
Barkashov. One of the ringleaders of the 1993 siege of the Russian
parliament, which ended when Yeltsin's forces shelled the building,
Barkashov eluded authorities for three months before his arrest. He later
was granted amnesty.

'We are ready'

Today, at 45, he sports a ponytail, and his black hair is thinning and
splotched with gray. During an interview in his office conference room,
with the party's red swastika flag on the wall behind him, Barkashov
signaled his intention to run for president in 2000, but he said his
followers were prepared to use force if necessary to help bring about a
"national renaissance."
"We are ready to get power by a democratic, peaceful way," the
former electrician and karate expert said through an interpreter.
"But if they try to prevent us from doing that, then we will perform
our rights by force. . . . You may call it a revolution. . . . Today, we
are strong enough for that, but we do not see the necessity for
"I'm a strong man. I'm not afraid of anyone. People are just afraid
of me."
Barkashov said the group was neither fascist nor neo-Nazi. The swastika,
he said, is a 10,000-year-old symbol used by many groups, and his party's
raised-arm salute is merely an enthusiastic greeting that "comes
from the heart."
Party literature and speeches, however, feature strident xenophobia and
calls for a resurgence of Russian power. The party's newspaper, Russian
Order, once insisted that Jews and Gypsies be "fully eradicated at
the earliest possible time."
"The party, however, couples such extremist slogans with more mainstream
appeals, including a pledge to take Russia away from "the
criminals," restore the military, protect "motherhood and
childhood," and provide jobs, housing and education for all
One of the party's biggest strongholds is in Stavropol, near the border
of the breakaway republic of Chechnya. Leaders of the Stavropol
organization have told the Russian news media that party members were
well-entrenched in the local government, and in police and army units in
the area.
Off-duty military officers double as adult supervisors for the teenage
Russian Knights, who train at a remote site outside the city. One
encampment consists of a cluster of red buildings with obstacle courses
and barracks. Another training ground is near a rural airport with
Soviet-era biplanes emblazoned with Communist red stars.
Barkashov and other leaders liken the party's youth auxiliary to the Boy
Scouts, saying it is intended to help prepare Russian young people for
the country's compulsory military service. But watchdog groups say the
training programs are breeding young ultranationalists with lethal
paramilitary skills.
Despite the military trappings, Barkashov said, Russian National Unity
prefers peace to violence.
"We are against bloodshed in the country, and we will do it only to
save our lives," he said. Nevertheless, he said, "everyone in
this country knows how to shoot. No one has any illusions about how
serious our intentions are."


Makashov Gives Further Comment on Anti-Semitic Remarks 

11 November 1998
[translation for personal use only]

The scandal over [Duma] deputy [Albert] Makashov's anti-semitic
statements continued to grow today. Deputy General Albert Makashov called
for the introduction of quotas on the number of citizens of Jewish
nationality appointed to official positions.
In an interview with Italian newspaper La Stampa, Makashov said Jews'
representation should be limited by law. He said six million people live
in Israel, of which one million are Arabs, but not one minister is an Arab.
Also, he said 85 percent of the population of Russia are Russians. They
should be represented accordingly. Makashov does not know modern Israeli
history very well and has completely forgotten the history of Germany
which, after Hitler came to power, was the only country in the world ever
to introduce official quotas on the representation of Jews in bodies of
power. And everybody knows what came after that.
Our correspondent today asked Makashov to comment on his interview
with the Italian newspaper, and comment was given. Correspondent Pavel
Lobkov reports:
[Begin recording] [Lobkov] General Makashov was apparently encouraged
by the limp reaction by the State Duma and Communist faction to his
anti-semitic statements. Moreover, it inspired him to new legislative
exploits. Today he called for a law setting a percentage quota on the
number of Jews in Russia's senior governing bodies. World experience of
anti-semitism shows that this is usually followed by a proposal for the
final resolution of the Jewish issue.
This is the electronic version of today's La Stampa. The percentage
of Jews in the government should correspond to the percentage in society,
and this should be enshrined in law -- that is Makashov's main idea. 
Having written this in her notebook, La Stampa correspondent Anna Zafesova
was somewhat taken aback. 
[Zafesova] I was actually stunned when he said this, simply because I
asked him if there was a Jewish question in Russia. He said: Judge for
yourself. Our government is full of Jews, and so on. He said what can we
do about this -- some kind of legislative measures.
[Makashov] I do not speak Italian.
[Lobkov] But nevertheless you talked about proportional representation
of Jews...
[Makashov, interrupting] Go [words indistinct].
[Lobkov] No, you talked about...
[Makashov, interrupting and raising voice] Go away.
[Lobkov] Did you talk about this or not?
[Makashov] Can you get away from me?
[Lobkov] You said this, it was published...
[Makashov, interrupting] What has it got to do with you? It is my
personal matter. You want a scandal, you'll get one now.
[Lobkov] What scandal? This is a criminal matter. It is anti-
[Makashov, grabbing article from Lobkov] I'll show you some anti-
semitism now. I am still of a good age.
[Lobkov] As you see, in the heat of his rage the general even
destroyed the printout from the innocent La Stampa.
[Makashov] I said that Russia is 85 percent -- step away from me
please -- 85 percent of the population is Russian, and when they are less
than one percent of the government and provacateurs like you are at work,
you know, you could harm your Jewish people.
[Lobkov] I am not a member of the Jewish people.
[Makashov] You are worse, do you understand? Then you are one of
those Russians like Gorbachev, who for me is worse than a Jew.
[Lobkov] Russian people will be watching you and listening to what you
are saying now, so they will be interested to know how you will decide who
is a Jew and who is not, according to the law.
[Makashov] You are behaving yourself worse than the worst yid [zhid].
[Lobkov] Thank you Albert Ivanovich.
[Makashov] You understand? Worse than the worst yid. That is a
definition given by Pushkin, Dostoyevskiy, and Gogol.
[Lobkov] From your lips that is a compliment.
[Lobkov] But later Makashov realized he would not get away without
commenting. When lots more correspondents arrived, Makashov's reflex
activity fell sharply:
[Makashov, talking to correspondents] One race has grabbed everything
in our country -- that is not right. This is not at all incitment of
racial hatred, it is just a wish to comprehend.
[Lobkov] The reaction of senior Communist officials was interesting. 
They declined to comment and were unusually reticent. Gennadiy Seleznev
answered questions obviously unwillingly:
[Seleznev, Russian State Duma Speaker] There will be a statement
today. As far as I know the presidium is preparing a statement.
[Unidentified correspondent] What is it about?
[Seleznev] About what you were asking me about.
[Unidentified correspondent] Condemning this?
[Seleznev] Of course.
[Unidentified correspondent] Gennadiy Zyuganov refused to talk about
Makashov at all.
[Unidentified correspondent] Gennadiy Andreyevich, reviving the
principle of quotas...
[Zyuganov, Russian Communist Party leader] Again, are there any
questions on the youth movement?
[Unidentified correspondent] Is nobody interested in the youth?
[Zyuganov] You are not interested in the youth?
[Unidentified correspondent] We heard you out...
[Zyuganov] Thank you, thank you. We have no more time. I will not
[words indistinct]
[Vladimir Ivanenko, Yabloko deputy] Makashov is a man who seems to me
to have specific health problems, so it is difficult to do anything with
him. The problem is something else, that his faction is not distancing
itself from him, that the Communist Party is not stating clearly that these
totally unbelievable views should not be possible at the end of the 20th
century. If someone wants to introduce proportional representation, then
these cranks should only be let into the State Duma according to quotas.
[Lobkov] If it recognizes Makashov as one of its own, the Communist
Party faction must now decide what is dearer: voters or Makashov. It looks
like the choice will be difficult, since Makashov's anti-semitic views are
backed in the party's ranks. Nevertheless, there will be a decision today,
or the faction will share responsibility and they will get the label of the
Chernosotentsiy [nationalist organization of tsarist times] [end recording]
[video shows Lobkov talking to Makashov; Makashov and other politicians
talking to correspondents]


Russia: 'D-Day' For Banks Has Arrived
By Floriana Fossato

Moscow, 17 November 1998 (RFE/RL) -- Yesterday marked the beginning of a
critical test period for Russia's troubled banking sector. A self-imposed
three-month moratorium on bank debts to foreign creditors expired over the
weekend, and now is the time when Russian banks must start paying off their
On August 17, former Prime Minister Sergei Kiriyenko devalued the ruble,
defaulted on domestic debt payments and, at the same time, decided to
impose a 90-day moratorium on repayments of foreign commercial debt. 
Speaking on ORT Public Television (Nov.15), the new Russian Central Bank
Chairman Viktor Gerashchenko called November 16 "D-Day." He said "nervous
creditors can (now) press their claims against Russian banks that borrowed
(their) money." 
Gerashchenko also declared that the government does not have the money to
help commercial banks meet their obligations to Western financial
institutions. Confirming an earlier statement by his first deputy, Andrei
Kozlov, Gerashchenko said Moscow is not considering any extension of the
90-day moratorium on the payment of debts. 
Clearly concerned about their inability to service the government's debt,
officials have cautioned that it would require more than $8 billion to
rescue the country's banking system. Last week, Deputy Finance Minister
Mikhail Kasyanov said forward contracts (eds: contracts for future
foreign-exchange deals) were dropped from negotiations between Moscow and
its creditors. The Russian government owes some $15 billion on defaulted
government bonds. 
Just to service its foreign debt next year, Russia is due to pay $17.5
billion. Kasyanov said that the Russian government will seek to hold new
talks with foreign creditors in order to defer repayment of its foreign
debt "for one or two years." 
Last year, Russia's largest commercial banks borrowed heavily abroad in
exchange for currency forward loans that expired this summer, when the
country's financial crisis reached its peak. These banks enjoyed a
temporary delay from their foreign debt payments during the moratorium. 
But now that the government has made clear it will not take responsibility
for the $6 billion Russian commercial banks owe to foreign counterparts on
forward contracts, many of them are expected to default. 
Financial analysts estimate that, in addition to what these large
commercial banks owe, other Russian banks are indebted to foreign creditors
for an additional $6 billion. They also say that both numerous creditor
lawsuits and a wave of defaults are imminent. 
Bloomberg Financial News quotes analysts in Moscow as saying that a freeze
on accounts and the seizure of the largest banks' assets are likely soon.
Andrei Ivanov, a banking analyst at Troika Dialog, told the news agency
that banks linked to large financial groups are likely to experience severe
problems in upcoming debt negotiations because foreign creditors will be
concerned that the groups' directors are more interested in saving their
industrial assets than the banks they own. 
Deputy Central Bank Chairman Kozlov says that 720 commercial banks, close
to half of all in the country, will be allowed to fail. But the Central
Bank has refused to reveal the names of 18 banks it has included on a list
it has prepared of so-called "socially and economically important banks."
These banks are likely to be bailed out as the government moves to
restructure the banking system. 
Chairman Gerashchenko said (Nov. 15) that the Central Bank would only
support those banks that can insure debt settlements and retain what he
described as "the skeleton of a banking system." He named among the larger
banks that might survive only SBS Agro (Russia's largest private bank),
Menatep and Most Bank. Gerashchenko placed Inkombank, once Russia's
third-largest bank in terms of assets, in a lower grouping which is
unlikely to survive. Inkombank's license has already been withdrawn and
other banks will have to fight through courts for their survival. 
Bloomberg also reports today that some banks announced they have started
appealing to foreign creditors to reschedule their debts. The agency quoted
an official at Uneximbank, Vladimir Gudilin, as saying the bank has created
a committee with outside legal and financial consultants to help in talks
with creditors. Uneximbank owns an estimated $1.44 billion in forward
contracts. Since August 17, at least four Russian banks, including
Uneximbank and Inkombank, have had their accounts blocked by British and
French courts because of non-payment. 


'Psycholinguist' Profiles Berezovskiy 

Rossiyskaya Gazeta
10 November 1998
[translation for personal use only]
Article by psycholinguist Irina Volkoa, associate professor at
the Russian Federation Government Higher School of Economics:
"Boris Berezovskiy is Not Interested in Institutionalizing Russian
Power. A Politoco-Psychological Sketch by Psycholinguistic

The experience accumulated by the young science of psycholinguistics
shows that even in the most sophisticated system for protecting a
politician there will always be a crack in the form of automatic speech
elements, through which, whether the subject likes it or not, there is a
constant leak of "information" regarding his true motives, intentions, and
action. The real work is the scientific interpretation of the personality
and activities of Berezovskiy strictly on the basis of his pronouncements.
The central objectives and preferences of the subject under
investigation can be set out in the form of a memorandum including the
following points:
irreversibility of privatization and completion of redistribution
of property;
tactics of wrecking tenders for the sale of state enterprises
("Svyazinvest," "Rosneft") and dispersal of consortiums prepared to
participate in them;
active influence on the formation of the body of legislation and the
executive hierarchy geared to restricting the role of state regulation,
making it difficult to devise a firm legal base for business, and
counteracting the full institutionalization of power. So one can predict
that Berezovskiy will resist any attempts to regulate the functions and
mechanisms of power, a system of checks and balances, and also efforts to
institutionalize the leading financial and industrial groups' secret
political influence;
interest in creating the minimum necessary system of social protection
for the population capable of lessening the danger of social instability,
which is the only uncontrollable factor in our hero's sphere of
maintenance of his own public image at a qualitative level that would
not prevent him from obtaining periodic "state orders" and temporarily
occupying senior posts.
What basic ideas and principles do Berezovskiy's activities serve? 
Our methods enable us to provide an answer to this question.
Words that relate to key categories -- market economy, reforms,
integration, civil society, federal structure, political transformation,
liberal political system -- are used by Berezovskiy as so called common
nouns with minimum meaning. In other words, they are merely conventional
tags that do not correspond to practical tasks.
The most common stock phrase in his vocabulary is applied to an
opponent in an affirmative statement -- "is a hypocrite," employs "double
standards" -- and applied to himself in a negative statement -- "I do not
like hypocrisy" -- and it masks one and the same flaw -- a lack of
conviction and active knowledge about the subject of his pronouncements.
The methods used by Berezovskiy of making crucial decisions in the
sphere of business and politics: Boris Abramovich tends to rely more on
his own intuition, his flair, than on knowledge and logic.
Berezovskiy's positions in politics, as in business, are characterized
by the fact that they lack the principles of strategic planning, a clear,
positive setting of goals, and stable ideological and political
Using just the names that appear in Berezovskiy's utterances, you can
rank them as follows:
The main resources of Berezovskiy's political influence are
concentrated in the information sphere. Their functional nucleus is
specialized information techniques in which things are directed by the
fourth branch of power in political and economic processes against the
background of the stalling of the other three branches. These techniques,
which in many cases might more correctly be described as psychological
techniques, began to be observed by the U.S. Propaganda Analysis Institute
back in the late thirties. They include: methods of "emotional control,"
using an ostensibly independent expert to promote a view; "imaginary
choice," which involves two-sided coverage of an issue, with arguments for
and against, but in such a way that the consumer "himself" reaches the
required conclusion; measured amounts of compromising material; and much
else. The target of this mass media action is the mass consumer, who has
the least immunity to brain-washing.
Berezovskiy's business is based on integration in the power system. 
His forte is converting illiquid political capital into highly investable
financial flows. For instance, it follows from Berezovskiy's own
"confessions," obtained by technological utterance processing procedures,
that the job of Security Council deputy chairman favorably influenced the
promotion of his oil projects and the job of CIS executive secretary helped
him successfully face the onslaught of the financial crisis.
What is characteristic of Berezovskiy is a high degree of personal
interest combined with a lack of confidence in his own attitudes and a
search for arguments to reinforce them. Ostensibly it takes the shape of an
inconsistent "I," which is liable to be censored and which alternates with
"we," which is dragged in to indicate the protection afforded by a
"powerful group." This "we," although implying a very definite group of
"oligarchs," nonetheless does not signify specific individuals and can mean
any arbitrary combinations of this type.
The true, emancipated "I" signifies the result of work done and the
ability to launch mechanisms to control the designated processes. Verbs
accompanying the "I," even if they are circumscribed by the sphere of
personal feelings and thoughts, tend to modify reality, while the
utterances themselves have the sense of strict resolutions. For example,
the utterance "I like to engage in public politics" can be read as "I will
engage in public politics by hook or by crook"; "I think that he (Yeltsin)
should go" can be translated as a promise to put words into effect as soon
as it becomes necessary. Such verdicts can be taken to be a bluff, but by
no means do we see them as statements that do not have real levers of
influence behind them. The most immediate example is the story of the two
abortive rounds of the tender for the sale of "Rosneft" -- in spring and
summer 1998, anticipated by Berezovskiy's categorical imperative at the
Davos forum in February.


Russian Citizens Favor Keeping Presidency 

MOSCOW, Nov 12 (Interfax) -- Fifty seven percent of Russian citizens
oppose the idea of annulling the presidential post in Russia, advocated by
the leftist forces.
This is clear from an opinion poll among 1,500 urban and rural
residents, held on October 31, the results of which were presented to
Interfax on Thursday by the Public Opinion fund.
Only 24% of those polled said presidency must be done away with.
Most of those who share this idea are supporters of Communist Party
leader Gennadiy Zyuganov (39%). But even among Zyuganov's supporters, many
(44%) support the presidency.
The most resolute opponents of the idea of annulling the presidency in
Russia are young people (71% of those under 35), people with a higher
education (64%) and residents of cities with a population exceeding 1
million (63%). Most of Moscow Mayor Yuriy Luzhkov's supporters (76%) are
also against this idea.


Over 50% of Muscovites Condemn Makashov Remarks 

Moscow, Nov 11 (Interfax) -- Fifty-one percent of the residents of
Russia's capital were aggravated by the anti-Semitic remarks that the State
Duma lawmaker from the Russian Communist Party, Albert Makashov, made at
rallies in Moscow and Samara in early October.
The figures about the public's opinion of Makashov were made available
to Interfax by the All-Russia Center for the Public Opinion Study on
Wednesday [11 November] following a poll among an estimated 1,509
Muscovites on November 7-9.
Fifteen percent of the poll's participants approved of the remarks
while 24% heard nothing about them.
The retired general's pronouncements evoked no special feelings among 
6% of the respondents while 4% were at a loss for comment.
Thirty percent of those polled believe Makashov must be criminally
persecuted for what he said, 29% feel he should be left in peace and 17%
were undecided on whether the nationalist should be brought to criminal
justice or not.


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