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Johnson's Russia List


March 9, 1999    
This Date's Issues: 3082   

Johnson's Russia List
9 March 1999

[Note from David Johnson:
1. The Independent: Helen Womack, Street Life - Where women tune in 
to Russia's 'Oprah.'

2. Moscow Times: Andrei Zolotov Jr., Orthodox Russians Blast Holiday.
3. AFP: Russian city is bright spot amid the gloom. (Nizhny-Novgorod).
4. Jacob Kipp: ponchki and bubliki.
5. Moscow Times: Milissa Akin, Four Writers Of Yeltsin's Speeches Find 

6. Dale Herspring: Russian Military.
7. Peter D. Ekman: Lugar's 20,000 MBAa and CPAs.
8. A-Infos News Service: Yasnogorsk Soviet.
9. Adrian Helleman: The need for morality.
10. Moskovskiy Komsomolets: Marina Ozerova and Mikhail Rostovskiy,
"Hysterics Deputy-Style. Is Russia Threatened With Early Elections?" 
('Vulnerable' Maslyukov May Bring Down Primakov).

11. AFP: NATO rejects must bide their time.
12. Reuters: Audit shows Russia central bank hid deals -report.
13. Los Angeles Times: Richard Paddock, Amid Crisis, New Russian 
Shake-Up of Cabinet Seen.] 


The Independent
March 9, 1999
[for personal use only]
Street Life - Where women tune in to Russia's 'Oprah'
By Helen Womack

For the typical Russian husband, who pays attention to his wife once a year,
there was an alternative this International Women's Day to rolling home drunk
and thrusting into her hands a bunch of wilting mimosa. He could roll home
drunk and give her a copy of the new bestseller Women's Stories. The only snag
was, she had probably been out already and bought the book herself. 
Women's Stories is based on a confessional television series of the same name.
It is hopeless to make a social engagement for a Tuesday evening, as all the
bars are empty, the streets are deserted and the blue light of television
screens flickers from every home. Russians are glued to a show hosted by the
peroxide blonde Oksana Pushkina, the closest they have yet to Oprah Winfrey. 

Each week, Pushkina interviews a famous Russian woman about her private life.
There is no studio audience. They just have a heart-to-heart chat. Compared
with Oprah, the programme is tame. But it breaks ground in Russia where, until
recently, Raisa Gorbacheva was the bravest woman here, because she dared to
appear in public with her husband, Mikhail, and show that she had something of
a personality herself. 

The heroines of Women's Stories are mostly unknown in the West, although two
names mean something outside Russia. Nanuli Shevardnadze, wife of the Georgian
leader Eduard Shevardnadze, enlivens a dull account of being a political
spouse with a description of how her husband howled in an ice-cold Jacuzzi for
10 days when trying to stop smoking. 

Lyudmila Rutskaya, wife of the Afghan war hero and Russian politician
Alexander Rutskoi, gives a much franker interview about how, on the eve of
their 25th wedding anniversary, the man for whom she had sacrificed her own
career ran off with a younger woman. 

"I did not attach much significance to it at first," Mrs Rutskaya says. "I
thought, 'He's grey-haired, it's just the male menopause.' But when the
articles started appearing in the papers, I realised he had gone completely
off his head. At his age, biology takes it toll. He flew to Argentina with
her. He came back, I looked at him and noticed he was wearing cosmetics -
women's face cream. I said to him, 'Sasha, how long have you been using
women's face cream?'" 

Pushkina, who learnt her interview techniques while working at American
television stations, says courage and determination are the qualities her
subjects have in common. She answers critics, who accuse her of banality and
muck-raking, by claiming to give comfort: ordinary Russians recognise their
own problems in the struggles of the stars and know that they are not alone. 

If Russian women had hard lives in Soviet times, when the Communists paid lip
service to equality while sending them out to work in road gangs, then their
lot has scarcely improved. The Russian woman still faces a low glass ceiling
at work and does everything at home for the man who might, if she is lucky,
wash the dishes on Women's Day. 

The celebrities in Pushkina's series probably had servants or dishwashers but
their hearts were still broken by unfaithful men, who left them to bring up
the children alone. Larisa Latynina, the woman who trained Soviet gymnasts
including Olga Korbut, describes how her husband would go off on "business
trips", returning a few days later with large sums of money. Only after he was
arrested and sentenced to five years in prison did she learn that he was a
swindler. His downfall ruined her career too, for the Soviet authorities said
she could not be trusted to travel abroad and denied her an exit visa. 

Hardship, however, has made Russian women strong and Pushkina believes the
time is right for feminism in this most sexist of countries. It should not
reject men, she says, because they are victims of the system too. Rather, it
should be a hearty babskoe dvizhenie (lasses' movement) of capable and
talented women, ready to help each other and do good in society. 

Pushkina believes there is no reason why a woman should not one day sit in the
Kremlin. The interview that gave her most satisfaction was with the democrat
Galina Starovoitova, shortly before she was assassinated. "She was a klassnaya
tyotya (a cool auntie), the nearest we have had yet to a woman leader in


Moscow Times
March 9, 1999 
Orthodox Russians Blast Holiday 
By Andrei Zolotov Jr.
Staff Writer

While Russia celebrated one of its favorite holidays, International Women's
Day, on Monday, some Orthodox Russians were boycotting it and calling it

Despite the chocolates, flowers and glorification of women's traditional roles
that are part of present-day March 8 celebrations in Russia, the holiday's
left-wing, feminist origins are repulsive to the more traditionalist and
patriarchal members of the church. 

With the growth of the church's arch-conservative wing in the past several
years, there has been increased debate about whether members of the faith
should celebrate March 8. 

Tamara Maximova, a teacher of English, has ignored the holiday since her
conversion to Orthodoxy in the late 1970s. Since March 8 is the eve of the day
when the Orthodox Church marks the discovery of the head of St. John the
Baptist - who, according to the Gospels, was beheaded at the request of Salome
- the holiday glorifies "this whore who killed the great prophet." 

But more importantly, she said, she wanted to distance herself from her
nonreligious Soviet past when March 8 was an important holiday. 

But as if one theory was not enough, last year a prominent young Orthodox
theologian and missionary, Deacon Andrei Kurayev, published an article which
argued that March 8 was the Jewish festival of Purim under another name. 

He wrote that German Social Democrat Clara Zetkin, who established the
holiday, was Jewish and had chosen a date commemorating the survival of Jews
who had been marked for death in fifth century B.C. Persia. Esther, a Jewish
wife of Persian King Ahasuerus, uncovered the plot of chief minister Haman to
annihilate her people. She used her influence with the king to have Haman
hanged and obtained a verdict allowing Jews throughout the Persian empire to
massacre their enemies. 

In articles published in the nationalist magazine Russky Dom and on the
Internet (,Kurayev has argued
that Zetkin picked Esther as the rebellious woman-heroine. 

"It is not right for Christians to celebrate Purim, even under another name,"
Kurayev wrote. "When I became a practicing believer, I came to love the
Orthodox 'women's day,' the Sunday of Myrrh-Bearing Women, which is celebrated
on the third Sunday after Easter. So I wrote this article not to have somebody
think less of Clara Zetkin and her people, but so that respect for our
Orthodox traditions would return." 

Irina Siluyanova, an Orthodox woman and professor of medical ethics at the
Russian Medical University, said the real reason for fundamentalists'
opposition to Women's Day was their opposition to the honoring of socially
active women per se. "When a woman's status is raised, they feel it can deform
the traditional family role," she said. 

When asked last week about his views on Women's Day, the head of the Russian
Orthodox Church, Patriarch Alexy II, said he had congratulated his female
staff for Women's Day on Friday. 

"We regard the civil women's day as normal and congratulate women, but we
remember our church days too when we honor women," he said. 


Russian city is bright spot amid the gloom

NIZHNY-NOVGOROD, Russia, March 8 (AFP) - The Russian region of Nizhny-
Novgorod, 450 kilometres (275 miles) southeast of Moscow, is one of the few
bright spots in the country's economy, continuing to attract investors.
"Industrial output was about the same in 1998 as in 1997, despite the
financial crisis, and growth will resume this year," Mikhail Tedorovich,
regional vice-governor with responsibility for the economy, said confidently.

He predicted investment totalling more than 500 million dollars in 1999,
compared with 150 million last year, referring to interest from German,
Italian, Japanese and Swedish firms in the pharmaceutical, automobile,
household goods and food industries.

Last month saw the European Bank for Reconstruction and Development put 10
million dollars into the Nizhfarm pharmaceutical factory, in the largest
foreign investment in Russia since the financial crisis broke in August last

Teodorovich admitted that Nizhny-Novgorod, viewed as the third economic centre
of the country after Moscow and Saint Petersburg, had not escaped the crisis

"The region has lost between 600 million and 1.3 billion dollars in all", he

But the area of 3.7 million people has major assets, such as automobile
builder GAZ, which unlike many Russian firms pays its taxes regularly,
accounting for a third of the regional budget on its own.

The region is one of only nine in the whole country out of 89 which give to
Moscow more than they receive.

But Nizhny-Novgorod is facing a major problem, that of reconverting to
civilian use military plants which during the Soviet era accounted for 30
percent of the local economy.

"The problem is less acute than a year or two ago. It's no longer a question
of survival, but of development and mergers," Teodorovich said. "Many
factories have succeeded in diversifying their output."

This has not happened painlessly, however.

The Sokol plant, which builds the MiG-31, considered one of the best fighters
in the world, also repairs trolley-buses for the municipality to earn some
cash and keep its workers busy.

Average wages are 580 rubles, or 26 dollars a month, and last year they were
paid some four months late, factory chief Vassily Pankov acknowledged.

But the situation is worse in other military plants: workers at the
Pravdinskovo transmission equipment makers have not been paid for 18 months.

After introducing measures to control the prices of basic necessities, the
authorities last month began producing cheap bread aimed at the most deprived,
notably those in rural areas where half the population lives.

At Nizhny-Novgorod's central market dozens of women from outlying villages
stand all day in temperatures well below freezing, trying to sell hand-knitted
shawls, for which they ask 300 rubles a piece.

"My pension amounts to 270 rubles, and here I am reduced to freezing for hours
in the market," said Tamara Ivanovna, an elderly woman missing most of her

As they wait for the better days promised by local officials, many local
inhabitants survive by cultivating small plots of land.

"I don't know how I would be if I hadn't my garden, my onions, cucumbers,
strawberries and tomatoes," said Volodia Romanov, a driver who also juggles
two jobs at once to feed his wife and two children." 


Date: Mon, 8 Mar 1999 
Subject: ponchki and bubliki 

I must have struck a sore nerve with my tongue-in-cheek remarks about
ponchki and bubliki. [Did some readers miss the SP at the beginning of the
piece? Anyone who calls himself a "stariy p. . . ." is not to be taken all
that seriously.] I forget our current expat community in Moscow often does
not know Russian. Sorry about that. 

I don't think that I ever used the word "imperialist." I did use commercial
elite. Are they the same? Commerce is a great equalizer? A little touch of
home? Expats in Moscow and East Side immigrants in turn-of-the-century New
York? Maybe, but it seems a stretch. International donut chain that sells
donuts to expats who can afford them vs. the Mom and Pop Italian restaurant
or Jewish deli that served an immigrant community in the tenements? Look,
tell me off that I am living in a dead past, long gone, and irrelevant. I
can accept that. But do not feed me a line.

Sure, I do appreciate those little enclaves of home in a foreign land. I can
distinctly remember getting wildly excited about "Tang" in the old days in
Leningrad. But my point was the alienation from things Russian and the
regular folks. This is a simple case of local donuts and bagels. They were
there. I found some the last time I was in Moscow. I suspect they are still
there. Try some. You might even come to like them and the people who make,
sell, and eat them. By the way, where do you think those New York deli
bagels originated? The last time I checked the folks who make and sell
ponchki and bubliki are engaged in commerce and selling their wares at
prices well below those at DD's. 


Moscow Times
March 9, 1999 
Four Writers Of Yeltsin's Speeches Find Voices 
By Melissa Akin
Staff Writer

When he watches President Boris Yeltsin's performance on television these
days, Konstantin Nikiforov tries to view the spectacle with a
professional's eye. 

"From a speechwriter's perspective, there are so many sound bites, it's
really difficult to analyze," Nikoforov, who helped pen Yeltsin's speeches
for eight years, said in an interview last week. "In the majority of cases,
it's just improvisation." 

His colleague Alexander Ilyin agreed with a sigh. 

"And all these improvisations are not very successful," Ilyin added. 

Nikiforov and Ilyin, together with Lyudmila Pikhoya and Vladimir Kadatsky,
stuck it out through the best and the worst with Yeltsin f from his moments
of glory to the darkest days of his presidency, in sickness and in health. 

Even when Russian jets were bombing the breakaway southern republic of
Chechnya in 1994-96, or when tanks were bombarding the rebellious
parliament in 1993, Yeltsin's public speeches were infused with a liberal

Now the four have given up, and written a book, a post-mortem on their work
in the Kremlin as the authors of Yeltsin's public image, his spichraitery. 

Their book, "The Echo of the Word: From the Professional Experience of the
Speechwriters of the First President of Russia," was released last
Wednesday at a reception attended by stars, fallen and otherwise, of the
country's political elite. 

It contains a smattering of operative advice acquired "on the march" on how
to prepare the toasts for the leader to pronounce at official banquets and
how to fend off malicious questions from journalists. Some suggestions are
disingenuous in their simplicity: "brainstorming sessions may be held in
the speechwriters' office or in an informal setting." Throughout are
scattered excerpts from the speeches, presented as examples, and short
reminiscences that rarely give details or insights into Kremlin life. 

The book was published by Nikkolo M, a high-flying consultancy that worked
with Yeltsin on his re-election campaign. 

The speechwriters have joined Nikkolo M's stable of specialists, hired guns
for political hopefuls cranking up their campaigns for the State Duma and
the presidency. Elections are set for December 1999 and June 2000

They were the last holdouts from a team of liberal intellectuals who had
joined Yeltsin in the Kremlin in 1992 with little political experience but
high hopes for what they remember as a dynamic, energetic president. 

"We didn't come to the president as ready-made speechwriters," Pikhoya
said. "But we all had rich life experience and professional experience." 

They have been officially replaced in the Kremlin by Andrei Shtorkh,
described by Russian media as the first professional journalist to write
Yeltsin's speeches. Yeltsin's official "image adviser" since mid-1996 has
been his daughter, Tatyana Dyachenko. 

The work of the current image team does not impress the veteran

"They've stopped preparing the sound bites altogether," Ilyin speculated. 

For now, they are reserving judgment until they hear the president's yearly
address to parliament, a document they were once charged with writing. This
year's address has been put off indefinitely due to Yeltsin's

The four still attempt to promote an image of Yeltsin as he was when they
joined him. They say that despite nearly constant sickness since his
re-election (he currently is in the hospital for treatment of a bleeding
ulcer), his inner circle is sicker still f and has been since just after
Yeltsin's 1996 re-election. 

"The illness itself isn't the greatest evil," Nikiforov said. "The
president is not only the head of state, not just a person. The president
is a state institution. The president himself isn't so much sick as the
Kremlin institution. The team of the president is sick." 

"At earlier stages [in Yeltsin's presidency], there was always hope that we
could have a positive influence," he said. "In this last period, we buried
our hopes." 


Date: Mon, 08 Mar 1999 
From: Dale R Herspring <> 
Subject: Russian Military

I was very pleased to see that my formr colleagues in the 
State Department put out what I would call a "white paper" on the Russian
miltiary. I suspect I know who was behind it, but I will not go into
details here. I have not read it, but based on what I have seen, it does
not appear to provide new details to those who follow it closely.

What it does do, however, is provide a USG imprimatur on what a
number of us have been saying for a long time. Even more important, it
also raises the question of "what is to be done" to new heights. There is
no doubt that there is a severe need for some help if we are going to
avoid a further distegration of the Russian armed forces.

Some, like Bill Odom, appear to have adopted the idea of the worse
the Russian military is, the better. I cannot accept that idea. I think
it is wrong for both personal and professional reasons. What the future
Russian soldier or sailor thinks of us could be very important, especially
if we find ourselves in a new "Cold War." 

First, permit me a personal comment. My son-in-law is an army
officer currently in Bosnia. Among other things, he serves as laision
officer with Russian troops. As I have noted in my many contacts with
Russian naval and army officers in the past, he finds them both good and
bad -- as in any army. My daughter is also an army officer and my older
son is about to graduate from the Naval Academy. So from a personal view,
I am very concerned about how the Russian military views us -- it could be
critical to whether one of my kids lives or dies.

Second, I think it is professionally in our interest to make the
offer to help in a big way. Odom has argued that 0-6s will try and steal
whatever we send. He is right, of course. Having said that, I think the
issue can be handled. For example, we have hundreds -- even thousands of
regular, reserve, and retired military officers who have thousands of
hours on the ground in the former Soviet Union and extensive experience
with Russian soldiers and sailors. People like Larry Kelly and John
Reppert come immediately to mind. Why don't we ask them about getting
things like MREs to the troops on the ground? They know what life is like
in the fox holes of the Russian armed forces.

I apologize for carrying on, but I think this is a critical issue.
Some, like Susan Eisenhower, have been in the forefront of this battle.
We need more prsessure, however. The bottom line is simple: When someone
is down and out as the Russian military is at present, we need an open
hand, not the mailed fist that Odom and others would prefer. Vot Vopros!


Date: Mon, 08 Mar 1999 
From: "Peter D. Ekman" <> 
Subject: Lugar's 20,000

Fred Hiatt (JRL 3081) mentioned Senator Richard Lugar's plan to fund
training for 10,000 Russian MBA's and 10,000 CPA's (Certified Public
Accountants). I try to follow Russian business education closely and this
was the first I've heard of this program, so it is impossible to discuss
Lugar's plan directly. Nevertheless an informed public discussion of the
needs and problems of business education in Russia is needed before the
U.S. Congress throws tens or hundreds of millions of dollars at a problem
that, I suspect, it knows very little about. American politicians like to
throw around money, but in Russia this can cause more problems than it
solves. With careful planning, however, business education could be one
area where America could really help Russia.
There are three types of Russian business training that are supported by
foreign aid: 1) short courses and internships outside of Russia (e.g. the
Yeltsin Initiative) lasting anywhere from a few weeks to 6 months; 2)
degree programs in outside of Russia (e.g. the Muskie Fellowships and the
EBRD loan program); and 3) degree programs within Russia.
Short courses and internships may have a place as part of larger programs,
and may help diversify an overall business training strategy, but in
general they seem to be mere junkets for the well-connected. Organizers of
these programs need to be very concerned with how the students are selected
and how to maintain an academic environment in a situation that the
students might view as a "freebie."
The Yeltsin Initiative, as a highly publicized and somewhat longer
program, deserves a closer look. Thousands of students were selected
across the country and given local "MBA classes" for several months, with
about a third of the students given internships abroad for up to three
months. My concerns about the program are threefold: 1) student selection
seemed to be open to political influence; 2) it's doubtful that the
students could have been given anything approaching MBA classes in a few
months by Russian instructors - most of whom had probably never taught in
an MBA program before; and 3) from published reports (e.g. in Kapital), the
internships did not seem to be either very educational or very challenging.
I'm not saying that the money spent on this program was completely wasted,
but I'd hope that there will be great improvements if the program is to be
Probably the most expensive programs are degree programs that take place
in the west. For example the Muskie program sends about 100 Russian
students to American business schools each year, picking up the whole tab
including living expenses and transportation. If the cost is just $20,000
per year per student in two year programs, each year's class costs
$4,000,000. That's a lot to pay for 100 graduates - many of whom will
figure out ways to avoid returning to Russia, where the payoff to their
education is much lower. Muskie does have agreements and visa restrictions
that force graduates to leave America for three years, but these agreements
are difficult to enforce outside of the U.S. There are few potential
problems for graduates to work in London or Paris.
Since most Muskie fellows are very talented people who are likely to
succeed in business, I'd suggest that, rather than being given their
tuition and living expenses, that they be lent the money. Collection on
the loans might be easier than most people would think - after all most
successful business people would like to be able to get a U.S. visa on
The EBRD program for Russians attending selected European business schools
seems much better in most ways than the U.S. grants. I've heard of only
two problems: 1) sometimes students have had difficulty getting visas to
attend the schools after they've been accepted at the schools and for the
loan; and 2) some students returning to Russia after Aug. 17 have had
difficulty getting jobs.
If Senator Lugar's program is to send 20,000 students to U.S. business
schools with grants, I'd consider it to be one of those foreign aid
programs, like the recent food aid to Russia, that does more for the
Americans involved than it does for Russia's long-term prospects. In other
words, it would be a big subsidy to American business schools, but
complicate the process of forming a business education system in Russia.
The three biggest complications it would cause are: 1) it would take all
the best students out of Russian classrooms, thus reducing the quality of
classroom interaction; 2) it would lower the perceived quality of degrees
earned in Russia, as the students who did return from America would
temporarily flood the job market; and 3) it would take money and attention
away from the real problem - building a system of business education in
Graduate business and economics degrees programs in Russia, to my
knowledge, get very little support from American foreign aid programs.
Russia is a big country and my knowledge is limited mostly to Moscow, but
I'd guess that of the dozen or so programs that have a reasonable
resemblance to MBA programs, none of them gets more than 20% of their
budgets from U.S. foreign aid programs. In fact, 10% of the budgets of 3
or 4 small programs is probably more accurate. 
There are many difficulties in teaching business in Russia. Let me just
focus on one - culture. Just as most successful companies have a well
defined "corporate culture," most successful business schools have their
own culture as well. Schools in Russia start with a big disadvantage - the
remains of the Soviet university system - "we pretend to learn, and you
pretend to teach." Over the last month there have been several
contributions to JRL on the problem of cheating among students. All I can
add is that it is definitely a major problem, until the students understand
that the administration takes it seriously. Ultimately, the problem is not
so much with the students, as with the administration. 
Other cultural problems include not showing up for classes, expecting to
pass without reading, doing homework or participating in class, the
multiple re-takes of final exams that are commonly allowed, oral exams
(especially entrance exams) that are open to favoritism, and a disease that
I'll call "New Russianism" among students who pay anything above a nominal
amount for their classes.
I know that it must sound like I hate teaching here! But - not so
surprisingly - all these problems almost disappear, once students are shown
that these practices are unacceptable. I think that this probably takes
flunking out about 10% of all new students (plus, perhaps, another 10% who
decide not to continue such hard work). In any case, it takes a dedicated
administrator who is not afraid of a little confrontation. In my
experience, no Russian administrator has been up to this task, but I hope
that once some Russians have gone through American-run programs, and then
gone into teaching, that a new standard will have been set.
An illustration: I've worked in a foreign-sponsored (not American)
undergraduate program, which has foreign administrators overseas and
Russian administrators in Moscow. The foreign administrators told me to
fail all those students who I was certain would fail their end-of-the-year
(foreign administered) exam. The Russian administration said that every
student would get 3 chances to pass the Fall semester final exam. Of 25
students, I failed 8 in the first round (1 for cheating), 3 in the second
round (all for cheating), and 2 in the third round. In the Spring semester
these two just kept coming to class, and I was told that the Russian
administration had no intention of allowing me to fail them. This is
probably the best undergraduate program in Moscow!


Date: Mon, 08 Mar 1999 
From: "Ingemar Johansson" <> 
Subject: Yasnogorsk Soviet

>From A-Infos News Service:

YASNOGORSK, Russia - A Workers' Collective Committee has taken over a
building plant in Yasnogorsk, a town of 20,000 people near Moscow. The
workers are battling the Communist Party local authority and the
privatization program for the plant. The Yasnogorsk workers say, "This is
revolution" and are appealing for international solidarity.

In 1990, the factory was turned into a joint stock company in which the
workers held a majority of shares. Last September the workers and
of the plant dismissed the Administration at a general meeting. When the
"owners" of the plant refused to recognize the results, the workers seized
control. A workers' committee (the Workers' Collective Soviet) was set up
now oversees administration, production, selling, all the finances,
distribution of wages and the town as a whole. However, all the factory
accounts have been blocked by the authorities and the company has since
declared bankrupt by the courts. The questions now are: who will run the
factory in the future and who will buy it later?

The workers realize that if it is sold, they will lose the last shares they
still possess and the previous administration will buy them. For this
the workers are demanding the plant be made state-owned or else have the
shares distributed among the workers. The workers and the town see this as
temporary solution and understand they are fighting against the trend
towards private property and capitalism.

Last December 10,000 people (led by the workers) from Yasnogorsk marched to
block the railway line into Moscow to support demands for the release from
prison of the worker-elected directors of the factory and to stop the
privatization move. It was only the mobilization of special police forces
the regional administration which prevented the workers from paralyzing one
the main railways in Russia. The two directors, L. Roschenia and V. Dronov,
were jailed in October but set free as a result of this general strike by
the workers and the threat of railway blockades.

On February 22, special police forces were sent in to prevent workers from
organizing a standard general meeting. The new court-appointed plant
has issued an order prohibiting all kinds of activity by the worker's
committee and trade-union, demanding the end of the strike and threatening
to fire all those who disobey. At a joint meeting, the workers decided that
they would not return to work until everyone had been paid.

The workers have been without pay for 10 months. The misery in Yasnogorsk
tremendous and the population is starving. Last Monday, two workers fainted
during meetings in the plant and were hospitalized. Every day one or more
workers are attended to by doctors. One worker says, "We have nothing
except for the potatoes we grow."

The machine-building plant has always been the centre of life for the
of Yasnogorsk and the only way to make a living for thousands of workers.
The plant is functioning today and its products are being sold and bartered
despite the crisis - this is how the whole town survives. The workers'
committee has received financial assistance from trade-unions and other
organizations. Money is distributed amongst the poorest and to those who
don't even have potatoes any more.


Date: Mon, 08 Mar 1999 
From: Adrian Helleman <> 
Subject: The need for morality

David Ellerman (JRL 3081 #5) offers a cogent rebutal of the arguments for
voucher privatization as put forward in the Washington Consensus. Since I
am not an economist, I won't address his rebutal or these arguments
specifically. What is my concern now is the tenor of his article, which I
would describe as economistic. By that I mean an overemphasis on economics,
as if a correct sort of economics would be able to solve a nation's
problems. Each of us, of course, tends to view the world through the lens
of our own speciality.

The reason for the failure of any form of privatization in Russia, in my
opinion, is the criminalization of this society, which has been described so
eloquently on this list in the past. This criminalization is due to the
absence of a moral underpinning to Russian society. Privatization has
failed here because of an inherent amorality, and until this is addressed
tinkering with economics will not solve its problems.

Economically and politically this country is in a big mess. All the current
economic and political tinkering is doomed to failure, and is as useless as
trying to rearrange the deck furniture on the Titanic. Until a strong
system of morality is developed and taught here, I do not expect much
success in these other areas. Russia, of course, needs the best economists,
the most capable political scientists, and the most outstanding politicians,
but they alone cannot solve its numerous problems. This is what I have been
preaching for several years already. Morality or, in this case, the lack
thereof lies at the heart of many of Russia's problems.

The basis of morality is religious. Any morality that is imposed will not
be able to weather the storms of life. Unless it is based on an idea of the
transcendent, it will fail as well. Morality is a gift--in Christian terms,
it is grace--which must be received and made one's own. Russia's rich
spiritual heritage offers a golden opportunity to enlist this heritage in
the service of conveying morality to a starving nation.

I blame the Christian churches, but not only them, for not teaching
morality, except the personal variety. Morality is not just personal,
athough it must start there, but it also has a social dimension. Therefore,
it will inevitably affect economics and politics. Honest businesspeople,
bureaucrats who do not try to enrich themselves at public expense,
politicians who want to serve the nation rather than themselves, and
economists and political scientists who do not regard advice as a marketable
commodity, these are the sort of people Russia needs. Add to the mix the
rest of society, all of whom dream of a better future and are willing to
work hard for it, and this country has the formula for success. As has been
said so often, Russia has incredible natural and human resources. These
must be harnessed for more than just private interests. If they are not,
then it may be time to write Russia's obituary. I hope we won't have to
write that the patient died because heart failure, while the doctors and
nurses were too busy lining their own pockets to notice. 

Adrian A. Helleman, Ph.D.
Moscow State University
Faculty of Philosophy


'Vulnerable' Maslyukov May Bring Down Primakov 

Moskovskiy Komsomolets
5 March 1999
[translation for personal use only]
Article by Marina Ozerova and Mikhail Rostovskiy: "Hysterics 
Deputy-Style. Is Russia Threatened With Early Elections?" 

Premier Primakov has received another snub. At the 
end of the week the Kremlin officially acknowledged for the first time 
that the president may remove key ministers or at least take control of 
the economy owing to the threat of another default. 
"If things go on like this, it is quite possible that the president will 
be simply forced to intervene in the talks with the IMF," Nikolay 
Bordyuzha, chief of the Kremlin apparatus, told Moskovskiy Komsomolets 
yesterday. He admitted bluntly that an "adjustment" to government 
"personnel" could in theory be one form of such intervention. But the 
most ominous statements were made by Finance Minister Zadornov. During 
contacts with the foreign press Russia's treasurer warned that if the 
talks with the IMF end in failure, this will mean the collapse of the 
entire Russian economy. Because Russia may over the next few weeks 
deplete its currency reserves, which are needed for debt payments. 
Translated from officialese into ordinary language this means "complete 
default".... In addition, the results of the investigation into White 
House corruption could be ready within as little as 10-15 days. And 
Bordyuzha admitted that if any criminal activity is found, dismissals are 
Yesterday's events provoked an unexpectedly harsh and prompt reaction
from the 
Duma's Communists. In the morning Zyuganov demanded an immediate 
discussion of the political situation in the country at the highest level 
and once again scared people with talk of a "liberal revanche," which 
"will not work" because the CPRF [Communist Party of the Russian 
Federation] leader is ready to appeal to the people if anything happens. 
Over the last few days the corps of deputies has been generally edgy. The 
meeting between Yeltsin and Primakov, which left a strange impression and 
regarding whose content a whole five contradictory stories are doing the 
rounds of the Duma.... The president is in the Central Clinical Hospital, 
the premier is in Sochi. Rumors, rumors, rumors.... Everyone was 
psychologically prepared for some unpleasant, crisis development -- 
dismissals, coups, aggravations. And such expectations in Russia almost 
never disappoint. 
In addition, Zyuganov is perfectly well aware that, by helping out the 
Primakov government in its battle against Berezovskiy, the opposition has 
put "its own" people in the government in the firing line. The vigorous, 
detailed press and television discussion of how clean Yuriy 
Dmitriyevich's [Maslyukov] and Gennadiy Vasilyevich's [Kulik] hands are 
can hardly please the CPRF, whose leaders (all whiter than white) have 
gotten accustomed over the past few years to tirelessly castigating 
corrupt officials from the opposite political camp. Incidentally, their 
reaction to all this is strikingly similar to the reaction of Chubays, 
who in his time accused the oligarchs of exaggerating the "book scandal." 
Zyuganov and Seleznev are also accusing the oligarchs. The most 
interesting thing is that they all are right. 
For those people who would like there to be no Communists in the 
government, the corruption charge leveled at left-wing ministers in the 
Primakov government is creating a definite backdrop to their work with 
the president. And for those who would ultimately like to bring down 
Primakov himself -- because that is most likely what will happen: 
Maslyukov's dismissal will lead to Primakov's dismissal, since what is a 
premier without the Duma's support? 
But the main reason why the Communists have now deemed it necessary to 
come to their first vice premier's defense is the aforementioned 
unsuccessful talks with the IMF, for whose progress Maslyukov is 
responsible in the government. This renders him particularly vulnerable 
now. That is why the Communists are beating the drums, blowing bugles, 
and kicking up a hullabaloo over "merely" rumors. They do not want to 
lose power. Their own first vice premier in conjunction with control over 
the Duma -- that is power. If they do not have their own first vice 
premier, there will be no reason to support the government. It will have 
to be sent packing -- if the president does not do this before them. It 
is virtually impossible that a second Primakov can be found who would 
suit the Duma. 


NATO rejects must bide their time

VIENNA, March 9 (AFP) - As the Czech Republic, Hungary and Poland are
officially inducted into NATO on Friday, the nine other countries which failed
to make it will have to bide their time for quite a while yet.
Albania, Bulgaria, Macedonia, Romania, Slovakia, Slovenia and the three Baltic
states of Estonie, Latvia and Lithuania, have the common feature of having
been turned down by the alliance for the time being.

All they can hope for is that negotiations on their entry will continue, but
all do not have the same weight within the North Atlantic Treaty Organisation.

Romania is among the most unfortunate candidates, having been supported by
most of the NATO allies when the invitations were being mulled in 1997, only
to be turned down because of its political, social and economic difficulties.

Bucharest does not conceal its frustration, with Defence Minister Victor
Babuic demanding that NATO grant a special status to the most deserving of the
remaining candidates.

There should be timetable and a set list of conditions for Romania and
Slovenia to join rapidly, he said.

Bulgaria was totally ignored by the allies when the first wave of invitations
was issued, but Sofia's stock is rising, and it too claims special treatment
within NATO's Partnership for Peace and an action plan to become a member.

"Bulgaria should be treated differently from the other countries of the
Partnership because they include former Soviet republics like Ukraine," said
Bulgarian President Petar Stoyanov.

Slovakia's chances are also improving because of political changes since the
electoral defeat of the autocratic prime minister Vladimir Meciar last

US Secretary of State Madeleine Albright has said that if reforms continue and
Slovakia improves relations with its neighbours it would be a solid candidate
for the next round of admissions.

The Bratislava government has expressed the hope that the upcoming 50th
anniversary summit of NATO in Washington will confirm an open door policy and
lay down a timetable for Slovakia's admission.

Slovenia's support remains steady but not very strong. It is backed notably by
Italy, which sees it as a missing link with Hungary, and is doing its best to
improve its chances.

In October it decided to allow NATO aircraft to use its airspace for eventual
operations in connection with the Kosovo crisis.

The situation of Albania and Macedonia, two impoverished Balkan states, goes
against them, but thanks to the situation in neighbouring Kosovo they have
their compensations.

These include a liaison bureau in Tirana and the stationing of NATO troops
near Skopje.

As for the Baltic states, they have support from the Nordic countries but have
the disadvantage of having been under direct rule from Moscow before breaking
away with the collapse of the Soviet Union.

No moves are expected at the Washington summit towards enlarging NATO further.
The alliance wants to digest the arrival of the three newcomers first. 


Audit shows Russia central bank hid deals -report

WASHINGTON, March 8 (Reuters) - The Russian central bank sent billions of
dollars of foreign currency reserves out of the country and into a secret
offshore network during the past five years, the Washington Post reported
Monday, quoting from an internal audit of the bank's activity. 

The newspaper said the audit contained internal documents that showed that
part of the money was clandestinely directed back into Russia's high-flying
government treasury bond market in 1996, a move that may have been illegal. 

Profits from the overseas investments also appeared to have been concealed
from the Russian authorities, the audit showed, according to the Post report. 

In particular, the documents showed that data about profits from the offshore
investments was missing, that information was concealed from Russia's
investigating authorities and that the central bank lacked control over
billions of dollars it sent overseas, according to the Post report. 

The Post said it had obtained the contents of the internal documents. It said
the audit had been turned over to parliament, but the documents had not. 

PricewaterhouseCoopers (PwC), one of the world's "Big Five" accountancy firms,
last month said it had been appointed as auditor for the Russian central bank,
following pressure from the International Monetary Fund for appointment of a
Western auditing company. 

At the center of the controversy surrounding the central bank is the offshore
firm Financial Management Co. Ltd., set up in Jersey in 1990, which managed
the country's reserves. 

It is not unusual for countries to park their currency reserves aboard in safe
securities or bonds, but it is unusual to turn over management of such
reserves to a small firm such as Fimaco. 


Los Angeles Times
March 8, 1999 
[for personal use only]
Amid Crisis, New Russian Shake-Up of Cabinet Seen 
Europe: Tension mounts as economy steadily declines. Crunch is expected when
debt payments fall due. Fresh IMF loans are unlikely without sound financial
By RICHARD C. PADDOCK, Times Staff Writer

MOSCOW--After nearly six months of relative calm under Prime Minister Yevgeny
M. Primakov, the Russian government appears headed for renewed turmoil as
tension between the Kremlin and key ministers mounts and top officials hint at
a Cabinet shake-up. 
With President Boris N. Yeltsin frequently in the hospital and detached
from day-to-day administration of the government, the economy has steadily
deteriorated, and the ruble is now hovering at an all-time low of more than 23
to the dollar. 
Russia will face a cash crunch in April when it is scheduled to start
making $4.6 billion in foreign debt payments that it can scarcely afford. Some
analysts say failure to pay back the loans would trigger the worst episode
since the financial collapse in August that prompted Yeltsin to fire the
government of Prime Minister Sergei V. Kiriyenko. 
Primakov, who replaced Kiriyenko, has focused little on programs to
revive the ever-shrinking economy and instead has made borrowing money from
the International Monetary Fund the centerpiece of his fiscal program. But the
IMF, after lending Russia about $20 billion since the collapse of the Soviet
Union seven years ago, has resisted granting further loans until the
government develops a sound economic program. 
In recent days, Russia's inability to secure new Western loans has
sparked repeated calls from free-market advocates for the removal of First
Deputy Prime Minister Yuri D. Maslyukov, who is responsible for the economy
and is the highest-ranking Communist Party member in Primakov's government. He
also is the chief negotiator with the IMF. 
"Regardless of the results of the progress in the negotiations with the
IMF, the economic team of the government has proved its complete incompetence
and should be replaced," former First Deputy Prime Minister Boris G. Fedorov
said Sunday in a televised interview. 
Helping create the impression that Yeltsin may soon fire one or more
ministers, the president's deputy chief of staff said in a TV interview
Saturday that Primakov has become too comfortable with the way his government
is operating. 
"It seems to me that Yevgeny Maximovich [Primakov] should be advised to
be more critical of the performance of the government, because this position
of complacency can make the prime minister and ourselves miss something that
is of key importance," said Deputy Chief of Staff Oleg N. Sysuyev. Yeltsin, he
added ominously, "has no complacency about the government." 
Russia's central government is losing its authority to such an extent
that an Interior Ministry general was kidnapped from a commercial airplane
Friday as he was about to depart from Chechnya, the tumultuous republic that
won de facto independence during a devastating 20-month war with Russia. On
Sunday, Interior Minister Sergei V. Stepashin threatened to use force against
Chechnya to free the general. 
Meanwhile, the economic turmoil and collapse of the banking system
brought about by the August collapse continue to devastate the lives of
millions of Russians. At a central Moscow bank Friday, a 66-year-old retired
army colonel whose deposits were frozen during the crisis tried to withdraw
funds at rifle point to pay for surgery for his wife. He got his money and
surrendered, then was quickly arrested. 
Despite his lack of action to improve the economy, Primakov has remained
relatively popular. The former foreign minister and intelligence chief has
also sought to consolidate his power within the government, placing loyal
supporters in key positions. With Communists holding top jobs in his Cabinet,
he has maintained the support of the Duma, or lower house of parliament, which
is dominated by the Communist Party and its allies. 
But increasingly, the Primakov government has come under criticism for
doing little to solve the nation's fundamental economic problems. 
"The activities of the Communists in the government can be assessed in
this way: They have been sitting in the government for six months and have
produced absolutely nothing, have done nothing, have reached nothing, haven't
come to terms with anybody," said Fedorov, who lost his deputy prime minister
post in the August shake-up. 
From the Moscow hospital where he is being treated for a bleeding ulcer,
Yeltsin may have paved the way last week for dismissing Maslyukov or other
members of Primakov's Cabinet by calling for the ouster of billionaire Boris
A. Berezovsky from his post as executive secretary of the Commonwealth of
Independent States, the loose association of 12 former Soviet republics. 
Berezovsky, one of Russia's most hated men and a symbol of the excesses
of the post-Soviet capitalist system, is widely believed to exercise great
influence over the president and his family. His critics say he is a modern-
day Rasputin who gives lavish gifts to Yeltsin family members, and he has
allegedly served as their financial manager. 
In recent weeks, Berezovsky has been locked in a power struggle with
Primakov. The prime minister announced an anti-corruption campaign and
criticized the tycoon for meddling in government affairs. Dozens of companies
connected to Berezovsky were searched; one firm is under investigation for
allegedly taping conversations of Yeltsin family members. 
In return, a newspaper controlled by Berezovsky has regularly published
articles accusing top Communist government officials connected to Primakov of
engaging in corrupt deals worth millions of dollars. 
On Thursday, Yeltsin called on the 11 other presidents of the
commonwealth to join in firing Berezovsky as executive secretary. By publicly
rebuking the billionaire, Yeltsin reduced one of his greatest political
liabilities and put himself in a stronger position to shake up the Primakov
government. Yeltsin is notoriously jealous of subordinates who become
powerful, and it would be in keeping with his past practices to fire Primakov
"President Yeltsin chopped off one head so far, but I am inclined to
think that more heads are likely to roll at the other end of the political
spectrum," said Leonid A. Radzikhovsky, a columnist for the newspaper
Sevodnya. "If Yeltsin sacks Maslyukov or some other Communists from the
government tomorrow, no one will be able to say that it was the result of
Berezovsky's influence and intrigues." 
Asked whether Yeltsin might reshuffle the government, Sysuyev said that
would be "the prerogative of the president. . . . It is impossible to
guarantee any pattern here that could lead anyone to believe they are in the
government forever." 
Although Yeltsin is largely incapacitated, Sysuyev said the president
will get involved in talks to win a loan from the IMF if he decides his
involvement is necessary. 




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