March 20, 1999    
This Date's Issues: 3099• 3100 • 

Johnson's Russia List
#3100
20 March 1999
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Kremlin sacking raises talk of trouble for Yeltsin.
2. Itar-Tass: Yeltsin Appoints Reportedly BEREZOVSKY'S Man to Head His
Staff.
3. Rossiyskaya Gazeta: Primakov Lists Priorities for Gore Talks.
4. President Clinton on Russia at March 19 press conference.
5. Itar-Tass: Maslyukov: $200 Billion Left Russia With Market Reform.
6. Phil Hanson: Russia: Crisis, Reform and the West.
7. Boston Globe: David Filipov, Blast kills 60 at Russian market.
8. Ekho Moskvy Interviews Nemtsov and Chubais.
9. The Electronic Telegraph (UK): Marcus Warren, Doors close on Moscow's 
wildest club. (Hungry Duck).
10. Argumenty i Fakty on Poll Results on Presidential Issues.
11. Reuters: Russian Communist chief vows backlash if govt goes.]

*******

#1
Kremlin sacking raises talk of trouble for Yeltsin
By Peter Graff

MOSCOW, March 20 (Reuters) - A surprise Kremlin sacking amid the fallout from
a sex scandal has fuelled talk of more political trouble ahead for Russia's
ailing President Boris Yeltsin. 

News late on Friday that Yeltsin had dismissed his chief of staff Nikolai
Bordyuzha brought a storm of overnight criticism from Russian politicians. 

``Once in a blue moon a decent person has come from outside the favoured
clique, and they got rid of him straight away,'' Gennady Seleznyov, the
Communist speaker of the State Duma lower house of parliament, told Interfax
news agency. 

He described the choice of Bordyuzha's replacement -- relatively unknown
former deputy chief of staff Alexander Voloshin -- as a sign of desperation. 

``The fact that they they are now bringing out such totally unknown and
faceless people means they have nobody else left on the substitute bench,'' he
said. 

The Kremlin gave little hint about the reason behind Bordyuzha's dismissal,
but it was certain to add to speculation that a sex scandal involving the
country's chief crime-fighter has tightened the screws on the ailing
president. 

The scandal emerged after state television showed footage on Wednesday of a
man resembling Prosecutor General Yuri Skuratov in bed with two young women,
raising the question of whether somebody -- perhaps with Kremlin ties -- had
tried to blackmail the prosecutor to block a criminal case. 

The sex tapes had appeared just hours after the Federation Council,
parliament's upper chamber which is made up of regional bosses usually loyal
to the Kremlin, humiliated Yeltsin by refusing to accept Skuratov's own six-
week-old resignation. 

Skuratov said he had offered to resign only under outside pressure and asked
the senators to let him stay on. 

Yeltsin, whose ill health has allowed him to visit his Kremlin office for only
a handful of hours since the New Year holiday, had emerged from hospital
treatment for a stomach ulcer only on Thursday. In a television appearance on
Friday he appeared exhausted. 

In announcing Bordyuzha's dismissal on Friday, the Kremlin said only that it
was in connection with a ``transfer to another job.'' The Kremlin has used
similar language in the past about sacked officials who were never offered any
other post. 

Communist Party chief Gennady Zyuganov told Interfax the sacking was a sign of
Yeltsin's ``convulsions.'' 

``The country already knows well the style of Mr Yeltsin, who is not able to
solve any issues but can endlessly shuffle his cadres,'' Zyuganov said. 

Nikolai Ryzhkov, leader of the Communist-allied People's Power parliamentary
group, said Yeltsin might still be planning to sack the coalition cabinet of
Prime Minister Yevgeny Primakov, a move which the president's opponents have
said would lead to a major political crisis. 

The showdown over Skuratov has left Yeltsin, who has seen his stature erode
dramatically over the past year, looking even more isolated than before. 

Oleg Morozov, leader of Russia's Regions, a centrist parliamentary group, said
the Kremlin's botched attempt to remove the prosecutor was a sign that
Bordyuzha had proved too ``naive'' to handle Kremlin machinations. 

As for the announcement that Voloshin had been named as Bordyuzha's successor,
Morozov expressed pure surprise. 

``I have no idea why that person would be named to this job,'' he said. 

*******

#2
Yeltsin Appoints Reportedly BEREZOVSKY'S Man to Head His Staff.

MOSCOW, March 19 (Itar-Tass) -- Russian President Boris Yeltsin on Friday
relieved Nikolai Bordyuzha from duties of the head of the Russian presidential
administration and secretary of the Russian Security Council. Bordyuzha was
reported to take up other work. 

Presidential spokesman Dmitri Yakushkin told Tass that the Russian president
had appointed Alexander Voloshin, 43, a new chief of the Kremlin staff.
According to Kremlin sources, Voloshin is a man of oil-to-media tycoon Boris
Berezovsky. He has been working as deputy head of the presidential
administration since September 12, 1998, and is reported to be close to former
chief of the Kremlin staff Valentin Yumashev, now a nonstaff presidential
adviser. 

Yakushkin told Tass that Yeltsin on Friday had met with the new head of his
administration at the "Rus" residence outside Moscow to give him instructions.

In a telephone conversation Yeltsin had with Bordyuzha the same day the
president thanked him for the work done, and wished him early recovery from
the heart problems Bordyuzha had recently experienced. 

*******

#3
Primakov Lists Priorities for Gore Talks 

Rossiyskaya Gazeta
18 March 1999
[translation for personal use only]
Interview with Prime Minister Yevgeniy Primakov by unidentified 
ITAR-TASS correspondent; date, place not given: "On Eve of Visit: 
Strengthening Foundations of Partnership for 21st Century" -- first 
paragraph is introduction

The next session of the Russian-U.S. Commission for 
Economic and Technological Cooperation, in which Russian Federation 
Government Chairman Yevgeniy Primakov will be taking part, will take 
place in Washington 23-25 March. The Russian premier answered ITAR-TASS 
questions before his trip to the United States. 
[ITAR-TASS] How do you assess the significance of Russian-U.S. partnership 
relations within the framework of the formation and development of our 
country's foreign economic and scientific-technical ties? How, in your 
view, have they changed of late? 
[Primakov] I have a very high opinion of their significance. The United
States
steadily features among our top three trading partners and is a major 
source of investment, advanced technologies, know-how, and managerial 
experience for the country. U.S. financial and technical aid is a weighty 
factor. Over the last few years plenty has been achieved in our bilateral 
economic ties. Commodity turnover has increased and the geographic and 
commodity structure of economic exchange has expanded. Good mechanisms 
have been developed for making progress with promising bilateral projects. 
Around 3,000 joint ventures have been set up in various economic sectors. A 
number of important steps have been taken to eliminate the restrictions 
on economic cooperation left over from the Cold War period. 
However, strictly speaking we are only beginning effective economic 
collaboration. Our commodity turnover is certainly increasing but what is 
$9 billion a year in the context of the $1 billion a day in U.S.-Canadian 
trade? What is $5 billion in U.S. investment in Russia compared with the 
tens, if not hundreds, of billions of dollars of U.S. capital investment 
in China? The current parameters of our economic relations are undoubtedly 
improving but they are doing so too slowly. Intensive, painstaking work 
lies ahead to strengthen the economic foundations of the Russian-U.S. 
partnership for the 21st century. 
[ITAR-TASS] In your view, what are the most important tasks facing the 
Russian-U.S. Commission for Economic and Technological Cooperation? With 
what results of the Commission's work would the Russian side like to 
enter the third millennium? 
[Primakov] When deciding to set up the Commission the presidents of
Russia and
the United States clearly set out its main task -- to lay a firm economic 
foundation for the emergent system of relations between the new Russia 
and the United States. In the past few years the Commission has been an 
important stabilizer in Russian-U.S. relations, lending them stability 
and predictability. This is illustrated, inter alia, by the over 200 
agreements, memorandums, and other treaty-legal documents signed under 
the Commission's auspices. Its sphere of activity has expanded 
immeasurably. Today it goes far beyond the purely economic and 
technological framework, affecting many other areas of our collaboration. 
Thus, in line with the decisions adopted by Presidents B.N. Yeltsin and B. 
Clinton at the September 1998 Moscow summit, currency-financial questions 
(reform of the banking system, shaping a global financial system in the 
21st century, etc) have been included in the Commission's purview along 
with the economic aspects of law-enforcement problems (countering 
transnational threats in the economy, combating money laundering, the 
flight of capital, and so on). And, as you know, these are top-priority 
areas in the current Russian Government's activity. 
The Commission's formative stage can be said to have come to an end. 
Ahead lies a great deal of crucial work to shape an architecture for 
businesslike collaboration between our countries which meets current
realities. 
[ITAR-TASS] What subjects and questions in bilateral relations can be
described 
as priority for the upcoming Commission session? What decisions would you 
like to secure so that the session can be called a success? 
[Primakov] In preparing for the session we have paid priority attention
to the
following questions. First, how to reorient the Commission's work to 
provide real assistance in resolving Russia's problems of macro and 
microeconomic stabilization and restructuring. Second, how to clear as 
far as possible the "obstructions" and unresolved problems that have 
built up during its work, how to boost the effectiveness of the 
Commission's work. It is no secret that by no means all of the 200 
documents signed within the Commission framework are up and running. 
Among the economic issues that we regard as a priority I would like to 
single out the minimization of the negative consequences of the U.S. 
antidumping investigation into Russian rolled metal shipments, the 
extension of the quota for commercial space launches by Russian 
launchers, the definitive settlement of questions associated with the 
implementation of the intergovernmental agreement on high-enriched 
uranium and low-enriched uranium, the resumption of U.S. Eximbank funding 
for projects in Russia, the abrogation of the Jackson-Vanik Amendment, 
and Russia's removal from various discriminatory restrictive lists. 
We also intend to discuss in detail with the Americans possible ways of 
galvanizing small business contacts, cooperation in the sphere of 
telecommunications and the commercialization of technologies, and 
collaboration in realizing regional investment initiatives. 
Thus, the agenda for the coming work in Washington is very packed and, 
importantly, concrete and we are preparing for it most thoroughly. 

*******

#4
Excerpt
PRESS CONFERENCE BY PRESIDENT CLINTON, MARCH 19, 1999 

Q: Mr. President, the Russian Prime Minister will be here next week
seeking your support for another very large installment in
international economic assistance. Yet, leading officials in your own
administration say there has been a retreat, if not a reversal, in the
pace of market reforms in Russia. Are you prepared to support the new
installment of IMF funding? And are you on the verge of an agreement
with Russia regarding its nuclear transfers to Iran?

CLINTON: Well, first, let me say that Mr. Primakov is coming here at
an important time. And I have urged all of us in the administration,
our economic team and our political team, to be acutely aware of the
fact that the first thing he had to do was to try to stabilize his own
situation, when he took office.
In terms of the economic reforms that he needs to pursue, he needs
some help from the Duma. And I would be a poor person to be
unsympathetic with a man who is having trouble getting a certain
proposal through a Congress. But I think it is important, if we are
going to help Russia -- and we should; we should do everything we can
-- that we do things that are actually likely to make a difference,
instead of things that will undermine confidence over the long run in
Russia, and in the ability of others to invest there.
So I'm hoping we can reach an agreement which will permit the IMF
program to go forward, because I think that is important. But it will
only work if the money doesn't turn around and leave the country as
soon as it's put in.
In other words, that's what -- what we have to persuade the Russians
of is that we're not trying to impose some economic theory on them.
We're not trying to impose more -- I don't mean just "we," the United
States; I mean "we," the international financial institutions, of
which the United States is a part -- and that we want to see the back
wages paid. We want to see the standard of living of the Russian
people rise. We want to see more investment go in there.
But there have got to be some changes, some of which require
legislative action in the Duma in order for this to work. Otherwise,
even if we put the money in, it will leave. And so that's what we're
working on. And I'm hopeful that we'll also get a resolution of the
second issue you mentioned, and I'm optimistic about that.

*******

#5
Maslyukov: $200 Billion Left Russia With Market Reform 

Tokyo, March 16 (Itar-Tass) -- About 200 billion 
dollars flowed from Russia since the beginning of the market reform, 
Russian First Deputy Prime Minister Yuriy Maslyukov told a news 
conference here on Tuesday. 
He said that over this period Russia's industrial output dropped by 60 
per cent. Russia now imports 60 per cent of food products. Maslyukov also 
said that Russia which used to produce 530 million tonnes of oil a year 
now produces only 300 million tonnes. The further lowering of oil 
extraction is unavoidable as there is a lag in prospecting and drilling. 
"All industries are folding up in Russia," the first deputy premier said. 
Maslyukov said he still continues favouring the market reform. "I am all for 
the market. I realise its necessity," Maslyukov said. "It is only that it 
is impossible to pass on from the totalitarian centrally-controlled 
economy to the market economy in one year". He said he favours 
"socially-oriented economy" aimed at ensuring primary needs of man, not 
of separate groups of people. "I wish that swindlers have no access to 
the Russian economy," Maslyukov said. 
He confirmed that the government will publish the medium-term programme 
of Russia's economic development in April. In this connection he 
formulated several tasks, describing them as strategic. Maslyukov said 
they include "eliminating obvious drawbacks of the economic reform," 
creating normal conditions for investors with the controlling role of the 
state, as well as selecting industries for priority development. 

*******

#6
Date: Fri, 19 Mar 1999 
From: "Phil Hanson" <hansonp@css.bham.ac.uk> 
Subject: Russia and the IMF again

Dear David,

Here, as an offer for the List, is a summary of a much longer paper 
on the Russian crisis and its implications for Western policy.

Phil Hanson

Russia: Crisis, Reform and the West

How much damage has last year's financial crisis done to Russia's 
economic prospects? What, if anything, should we in the West be 
doing about it? Is it time at last for the governments of the G-7 
countries to brace themselves, take a deep breath, and do nothing? 
No more bail-outs?

The first thing to be said about the rouble devaluation and partial 
debt default of 17 August last year is that it was a giant shock for 
the Moscow markets, but a small step for Russia. Monthly statistics 
for last year show a general deterioration - for example, in 
industrial output and in retail sales - from the first quarter. That 
worsening, in turn, was superimposed on a nine-year fall in recorded 
gross domestic product, of the order of a half, from 1989. The fall 
stopped in 1997, but it had resumed last year well before the 
"crisis". 

The second thing to say about that crisis is that its negative effect 
on the Russian real economy was heavily concentrated on two sectors 
and one region: financial services, the distribution of imported 
consumer goods, and Moscow. Certainly, the ripples were felt by 
people engaged in other activities and living in other parts of 
Russia; but it seems they were much diminished. Some groups, indeed, 
have benefited: managers in energy and steel exporting companies, 
whose rouble profits were boosted by the devaluation; perhaps also 
some domestic producers competing with imports - not just in food 
processing but in a few other sectors as well, such as domestic 
tourism . For a great many people, however, the financial crisis had 
no great direct effect on their lives. In much of Russia, if you were 
getting by on a low wage or pension, unreliably paid, with housing, 
utilities and local transport massively subsidised, and with a heavy 
dependence on home-grown food, a tripling of the rouble price of 
Snickers bars or imported TVs was at most a light and glancing blow. 
Much of the crisis was just distant thunder.

In another sense, however, the devaluation and default have done 
severe damage. They have set back the cause of economic reform. 
The 17 August measures were announced by Russia's last reform 
government of the 1990s - that led by Sergei Kirienko. It is true 
that the acting government of Viktor Chernomyrdin, lasting barely two 
weeks after Kirienko's dismissal, and failing to gain parliamentary 
approval, still contained some well-known reformers in senior posts. 
But since Evgenii Primakov's appointment as premier on 11 September, 
Russia has had a government (and a Central Bank) without a 
reformer in high office. To the senior members of the present 
government liberal, free-market reform is a bad idea that has done 
great harm and that has at last had its comeuppance. In this, they 
seem to reflect the general sentiment of the population.

Of course, if it really was, for Russia at least, a bad idea, its 
comeuppance would have been a consummation devoutly to be desired. 
Unfortunately for Russia, there is no better idea available. Still 
more unfortunately, it may be impossible for the pursuit of reform to 
be renewed for some time. That, I believe, is the real fix that 
Russia is in.

The absence of alternative approaches is apparent from the inaction 
of the Primakov government. Rhetoric about more government 
intervention has come to very little as the 1999 federal budget has 
been trimmed in order to elicit more money from the IMF. And there 
is no successful "third way" to follow. No ex-communist country has 
devised a way of recovering and moving towards prosperity except by 
orthodox, "neo-liberal" means: financial discipline, market 
liberalisation and the replacement of state enterprises with real 
firms. 

That judgement rests on the experience of a decade or so of 
post-communist economic change in 21 countries (the European Bank for 
Reconstruction and Developments' 26 "countries of operation" less 
those that have been torn by war: Azerbaijan, Armenia, Bosnia, 
Georgia, Tajikistan). For each of those countries it is possible to 
compile "transition indicators" measuring progress in privatisation, 
de-regulation, financial-sector development and the state of 
commercial law. If one takes the total (for mid-1998) of the 
EBRD's scores for each country and puts it beside the national 
figures for 1998 GDP as a percentage of the 1989 level, there is a 
positive and significant correlation. 

This is not exactly a sophisticated statistical test, but it does 
have the merit of conforming with common observation: the countries 
that have done the most in orthodox reform - Poland, Estonia, 
Hungary, the Czech Republic, Slovenia - are in better shape than 
those that have done the least - Romania, Belarus, Ukraine, 
Uzbekistan, Turkmenistan. As World Bank economists argued from a 
shorter run of data in the Bank's 1996 World Development Report, 
orthodox free-market reform does pay off in ex-communist 
countries - even if it has worked more slowly and painfully than many 
expected at the start.

On the other hand, the reform record across the ex-communist 
countries is also discouraging: of 26 countries, with a total 
population of 404 million, the only clear successes are the five 
would-be first-wave entrants to the EU, listed above. Their total 
population is about 63 million. Perhaps another six small 
Central-East European countries may be not far behind. At best, 
however, less than a quarter of those 404 million people live in 
countries that have made a reasonable fist of economic "transition". 
Most of the other three-quarters live in the former USSR.

After a decade of post-communist economic mutation, it is time to ask 
what went wrong. The Russian story is not unique to Russia: it is, 
with local variations, characteristic of the whole of the former 
Soviet Union apart from the Baltics, and of some of the Balkans as 
well. 

In the specialist literature two lines of explanation are emerging; 
they may be complementary, not rival, accounts of the problems 
involved. The first is to do with the economic structure inherited 
from the communist era. In countries whose industrial sector is a 
product of communist construction, a combination of excessive 
plant-size, long supply chains amongst producers and the location of 
production facilities regardless of transport and other costs may 
make the reallocation of labour and capital to new activities and 
the restructuring of established production units far costlier than 
it is for countries with less awkward initial conditions. 

The second is to do with social norms and accepted patterns of 
behaviour. Surveys assessing the extent of corruption in the 
everyday dealings between citizens and officials show large 
differences across these countries. That is just one aspect of a 
larger phenomenon. Despite their common legacy of communist rule, 
the peoples of Central Europe and the former Soviet Union have 
entered post-communist life with very different expectations about 
the scope for cooperation and trust outside the family and 
outside patron-client relationships. Paying taxes, obeying the law, 
being ready to resolve contractual disputes through the courts - all 
these desirable attributes of citizens in a liberal order - are 
unevenly distributed across the countries of the region.

For one or both of these reasons, the thorough implementation of 
free-market reforms has not so far been credible in Russia. The 
extraordinary growth of non-monetary settlements in Russia since 1994 
- barter, tax offsets, other money surrogates - has been a way of 
keeping a large proportion of Russian production units from being 
either closed down or re-structured, while at the macro-economic 
level the government has followed IMF advice on monetary discipline. 

This was clever: Russia had financial discipline in general without 
having it anywhere in particular. The conjuring trick could not 
work, however, without keeping public spending around 40% of GDP 
while state revenue (federal and regional budgets and off-budget 
funds) was closer to 30%. When investors ceased to believe the 
government deficit could be sustained - or rather, when crises in 
other emerging markets forced them to look more closely at 
what was going on in Russia - devaluation and default followed.

Western governments can take one of two views of Russia's reform 
failure: the robust view or the 30,000 nuclear warheads view. The 
robust view appeals to economists: more aid is simply an incentive 
to go on putting off reform; stand back and wait long enough, and at 
some point in the future a Russian government will take up the cause 
of reform again, and push it through. This might take decades 
(Argentina is routinely cited as an example), but if there's no other 
way to climb out of the hole, they'll get round to it eventually.

The 30,000 warheads view has so far appealed more to politicians: 
Russia is too dangerous to be allowed to fail. To quote US Treasury 
Secretary Robert Rubin on 18 March: "If Russia destabilises, the 
costs to the United States are going to be vastly greater than 
anything we can possibly think of." One difficulty with this view is 
that Russia seems quite capable of failing with aid; indeed, it 
already has. Another difficulty is the opacity of talk about Russia 
"fragmenting," becoming "isolated", or "destabilising". At least, 
before paying up out of fear, we should try to clarify our fears. 
What really are the likely social and political consequences of a 
Russian general default? What dangers to the rest of the world 
really are likely to follow from it? 

Probably the 30,000 warheads worry will prevail. It usually does, 
and the IMF has held to the robust view now for all of eight months. 
Whatever we do, however, we should be aware that there are strong 
reasons to doubt that more aid will turn the Russian economy around.

Philip Hanson
Professor of the Political Economy of Russia & Eastern Europe
CREES
University of Birmingham
Birmingham B15 2TT
UK
tel +44-121-414-6347/6353
fax +44-121-414-3423 

********

#7
Boston Globe
20 March 1999
[for personal use only]
Blast kills 60 at Russian market 
Moscow blames terrorists for attack
By David Filipov

MOSCOW - A powerful blast ripped through a crowded marketplace in Russia's
volatile southern rim yesterday, killing at least 60 people, wounding scores
more, and threatening the fragile peace in a region brimming with crime and
interethnic conflicts.

The explosion in Vladikavkaz, a regional capital 1,000 miles south of Moscow
and 30 miles from the breakaway republic of Chechnya, turned an outdoor bazaar
into a scene of carnage and destruction. Television showed bodies lying among
scattered clothing and produce as local people and police tried to sift
through the blood-stained wreckage to identify the remains.

The bombing, which authorities called a terrorist attack, also highlighted
Russia's failure to find a lasting solution to the bitter territorial disputes
that have surfaced in the northern Caucasus after the 1991 collapse of the
Soviet Union.

Yesterday, Russia's Interior Ministry put its troops on combat alert to try to
prevent further violence.

''We want to warn those who favor stirring up the situation that after today
they will meet a harsh response,'' Deputy Interior Minister Vladimir Vasilyev
told NTV television. 

Police said the timing device exploded with the force of 15 pounds of TNT,
spraying the market with shards that cut down shoppers and merchants.

''I don't remember much,'' one man told Russian television. ''It blew up and
threw me and that's it.''

Local police said the condition of the bodies made it hard to be sure about
the number of casualties, but figures last night put the death toll at more
than 60, with more than 100 people hospitalized.

Russian authorities quickly termed the blast a terrorist attack, and President
Boris N. Yeltsin went on national television to promise a ''merciless
struggle'' against the perpetrators. 

''I consider this bloody crime an attempt to destabilize the situation in the
northern Caucasus, to sow enmity and hatred,'' Yeltsin said in a telegram to
North Ossetian President Alexander Dzasokhov. 

Yeltsin told Interior Minister Sergei Stepashin, head of the country's law
enforcement services, and Vladimir Putin, head of the Federal Security
Service, to fly to Vladikavkaz to head the investigation into the bombing.

Stepashin told reporters yesterday that he would not only find those
responsible for the attack, but take ''serious measures'' to ''figure out why
this is happening today in the northern Caucasus.''

No one claimed responsibility, and no single explanation loomed. The Russian
Caucasus region where Vladikavkaz is located is awash with weapons and teeming
with murderous hostage-taking gangs, who kidnap their victims for ransom.

The blast came at a time of renewed tensions between Russia and Chechnya,
which for 21 months to break away in a war that claimed as many as 80,000
lives and ended in 1996 with Chechen rebels in de facto control over the
region. This month Moscow threatened Chechnya with renewed force after a
Russian general was kidnapped in the Caucasus.

But an even older territorial dispute may also be involved. Vladikavkaz is the
capital of North Ossetia, a semi-autonomous republic that waged a bloody
conflict in 1992 with the neighboring region of Ingushetia that left hundreds
dead and forced 30,000 ethnic Ingush to flee their homes.

Yesterday's blast came two days after two Ingush homes in North Ossetia were
blown up in the border region claimed by both sides, and one day after 50,000
Ingush took to the streets of their largest city, Nazran, to demand action
from federal authorities to end the dispute.

Russia's minister for nationalities issues, Ramazan Abdulatipov, told the
lower house of Parliament, the State Duma, that he thought Ingushetia's
leaders were responsible for the spiraling violence.

Ingush leader Ruslan Aushev responded that someone was trying to set up his
people.

''See how deftly it is done,'' Aushev said on NTV television. ''Yesterday the
Ingush had a rally, and today there is an explosion. The criminals are happy
because the Ossetians will say the Ingush did it.''

Like their fellow Muslims and ethnic cousins the Chechens, the entire Ingush
nation was declared an enemy of the Soviet state in 1944 and deported en masse
to Siberia and Central Asia by Soviet dictator Josef Stalin. Both peoples were
allowed to return to their homelands after Stalin's death in the 1950s, but
Ingush often found their homes occupied by Ossetians. 

When the Soviet Union broke up in 1991, Ingushetia claimed a part of North
Ossetia as its own territory, setting off the conflict. Although the worst
fighting ended in 1992, violence has occasionally flared up, and the two
regions are separated by a heavily guarded border.

Ingushetia stayed out of the war in Chechnya, and the Ingush do not share the
Chechens' desire to secede from Russia. But recently, Ingushetia has tried to
win the right to name its own law enforcement officials and restore such pre-
Soviet traditions as allowing men to wear a dagger in public and allowing
vendetta killings. 

Yesterday's blast drew attention away from an embarrassing political scandal
in Moscow, in which Yeltsin has come under fire after state television showed
a pornographic video of the country's chief prosecutor with two women.

But a new crisis in the Caucasus may prove a burden Russia cannot handle. Some
observers yesterday suggested that this was the idea.

''Destabilization is advantageous to a certain part of the political elite of
Russia. Inflation, war, chaos will allow them to cancel [this year's]
elections for the State Duma and [next year's] presidential elections,'' said
Siberian Governor Alexander Lebed, a candidate for president. ''This is a
provocation that has nothing to do with interethnic relations, and everything
must be done to not let extremists use it for their goals.''

********

#8
Ekho Moskvy Interviews Nemtsov, Chubays 

Radiostantsiya Ekho Moskvy
17 March 1999

[Presenter] Good day. You are listening to Ekho 
Moskvy presented by Aleksey Venediktov. Our guests today [17th March] is 
Boris Nemtsov and Anatoliy Chubays. Good day. 
[Chubays] Good day. 
[Nemtsov] Hello. 
[Presenter] We agreed a long time ago about you visiting us. Two years have 
passed since the so-called government of young reformers was formed. Let 
me remind you that on 17th March 1997 Boris Nemtsov and Anatoliy Chubays 
became first deputy prime ministers in the Russian government. [Passage 
omitted: the presenter recalled a bet with Nemtsov on how long the latter 
would stay in the government]. 
[Presenter] The main news today came from the Federation Council [upper
chamber 
of parliament]. Let me remind our listeners that the Federation Council 
today rejected the resignation of Prosecutor-General Yuriy Skuratov. [A 
brief remark indistinct]. I would like to ask you the following question. 
In his speech in the upper chamber and later, when he was answering 
questions from senators, he said that he was forced to resign by several 
officials, including two former deputy prime ministers, top officials 
involved in privatization and financial oligarchs, he said, but he did 
not name anyone in particular. Do you think he meant you as well? Did you 
try to use your influence in the Kremlin and the financial circles to 
make Yuriy Skuratov leave his post? 
[Nemtsov]There are so many crimes which have not been solved, you know.
Probably, 
because investigators in the Prosecutor's Office are doing a bad job, a 
really bad job. I have had nothing to do with Yuriy Ilyich [Skuratov] 
after my resignation and I am not going to have anything to do with him 
in future. I think that Yuriy Ilyich - deliberately or not - put the 
president in a rather stupid position. 
[Presenter] Why? 
[Nemtsov] He tendered his resignation. And what do you expect Boris 
Nikolayevich [Yeltsin], who is the head of state, to do? He considered 
the resignation request and took a decision. What position does the 
president find himself now? And what about Yuriy Ilyich? When he says he 
thinks they will have a meeting, it sounds really ridiculous because if 
he wants to meet the president, he, as the prosecutor-general, should 
simply use the direct line and such a meeting can be arranged, 
irrespective of where the president is at that particular time. This is 
not serious. If you tender your resignation, your next steps are obvious. 
[Presenter] Anatoliy Borisovich, your name has not been mentioned, but you
have 
influence and you fall into the category of top privatization officials 
and first deputy prime ministers. Do you think Skuratov's accusations 
refer to you? 
[Chubays] I will come straight to the point and say unambiguously that my 
attitude to Skuratov's work, who, as I understand it, will resume his 
work as of today, is negative. And for a very simple reason. The 
prosecutor-general is a top state official. If he decides to resign and 
tenders his resignation, that's it, the issue is closed. [Passage 
omitted: people should be more responsible for their actions, he says. 
Chubays recalled how he himself resigned; Nemtsov says that the president 
may not like the fact that the Federation Council rejected the 
resignation of Skuratov. Chubays disagreed with the Federation Council's 
decision to ban officials who were in power in Russia during the 17th 
August crisis from ever working for the government again]. 
[Presenter] Many colourful accusations have been levelled at Anatoliy
Chubays 
over many years. One of the most recent accusation is that Chubays seeks 
to turn the Unified Energy System of Russia company into the election HQ 
of the Right Cause bloc. The accusation was prompted by the fact that it 
was proposed to include [former acting prime minister] Yegor Gaydar, 
[former prime minister] Sergey Kiriyenko and others in the company's 
board of directors. What can you say about this, Anatoliy Borisovich? 
[Chubays] Yes, that is right. And I can add to your list and name Boris 
Nemtsov and [former finance minister] Boris Fedorov. It is a fact. The 
rest is sheer speculation. The question is quite simple really. There is 
a law on joint-stock companies in accordance with which the board of 
directors is formed on the basis of proposals from the company's 
shareholders. We have many shareholders because our company is big. About 
a third of our shareholders are foreigners. They decide for themselves 
who is most suitable to be in the board of directors. They, naturally, 
propose people who they think are capable of implementing Western-type 
professional policies, protecting the rights of property owners and so 
on. [Passage omitted: Asked about political activities, Nemtsov, who is a 
member of the Right Cause association of various movements, says that the 
organization is backed by "millions" of people and its members are 
currently busy explaining their plans to people all over Russia. Chubays 
and Nemtsov recall their successes and failures when they were in the 
government]. 
[Presenter] My next question to you, Boris Yefimovich [Nemtsov], as a 
politician, and to you, Anatoliy Borisovich [Chubays], as an expert, I 
would say, is about the impeachment procedures against the president. It 
seems to me we are entering a stage in this situation when a date has 
already been set and we have 12 volumes of reports which have yet to be 
studied by deputies. What can you say? 
[Nemtsov] The Communists are getting ready for elections. They have
turned the
State Duma into their election HQ. They want to make sure that the State 
Duma is not dissolved. The only legal, constitutional way of doing this 
is to launch impeachment procedures. In this case the Duma cannot be 
dissolved, according to the constitution. So, they will now go on 
destroying the country in that HQ of theirs until the elections and spend 
state money doing so. This is what the impeachment procedures are all 
about. It is clear to everyone that there will be no impeachment. 
[Passage omitted: they should have started them ages ago, if they really 
meant it]. 
[Presenter] What do you think, Anatoliy Borisovich? 
[Chubays] The procedure is full of ridiculous paradoxes, if one is to
listen 
to what Boris Yefimovich says. The situation is really ridiculous. A 
preliminary agreement on accord [between the branches of power] was 
signed yesterday, and on the same day a decision was made to go ahead 
with voting on the impeachment procedures. [Passage omitted: Chubays 
recalls 1991 and accusations against Yeltsin put forward by the 
impeachment commission]. 
[Presenter] The president seems to constantly unwell. He is at the Central 
Clinical Hospital now. He has just had a meeting there with the prime 
minister to discuss the situation in connection with Skuratov's 
resignation or nonresignation, if you like. This does not help to 
strengthen power in Russia or the country. Perhaps the constitution 
should be amended to take into account such situations, Anatoliy 
Borisivoch? 
[Chubays] I hold a rather conservative view on such matters. It seems to me 
that the constitution should be changed only when all political forces 
agree that it should be done. [Passage omitted: unfortunately, political 
forces want changes to suit themselves]. I have a feeling that the 
constitution will not be changed, and it is not such a bad thing after 
all. 
[Presenter] What about you, Boris? 
[Nemtsov] I understand what you are talking about. You asked us whether 
Yeltsin should resign before his term expires. I can say that every 
example from the history of Russia, beginning with the time of Boris 
Godunov, Nicholas II and up to the time of Mikhail Gorbachev, shows that 
unrest takes place in the country when this happens, chaos starts. 
Therefore, the president should remain in office for the full term 
envisaged by the constitution. And I wish him good health. 
[Presenter] Talking about the future, Anatoliy Borisovich, rumour has it
that 
during former prime minister Viktor Stepanovich Chernomyrdin's visit to 
Washington to attend the talks with the IMF it was said that you should 
be in charge of a special committee for collecting taxes. Are you ready 
for another job? 
[Nemtsov, laughing] And collect taxes from the Unified Energy System of 
Russia. [all laugh]. 
[Chubays, laughing] I have nothing against it. 
[Presenter] I meant to change jobs because the economic situation is very 
difficult. 
[Chubays] My answer to this would be very long, detailed and justified. No. 
[Passage omitted: Chubays says he has not been closely following the IMF 
talks but thinks it is important to carry out IMF demands if we want 
loans. He hopes the talks will produce positive results. General talk on 
resignation matters]. 
[Presenter] Anatoliy Borisovich, it has been reported that you were offered
the 
post of head of the presidential administration. 
[Chubays] You have already asked me whether I would agree to change jobs. I 
have received no such proposal. And my position is clear. I am engaged in 
some serious work and I would like to do it properly. I do not want to 
hop from one place to another for political gains. I would like to do 
what I was asked to do and get some results. And this is what I am going 
to do this in the Unified Energy System of Russia company. 

******

#9
The Electronic Telegraph (UK)
20 March 1999
[for personal use only] 
Doors close on Moscow's wildest club
By Marcus Warren in Moscow 

ONE of the wonders of the Western world was no more last night after the
Hungry Duck, Moscow's wildest bar and home to some of the most uninhibited
women on the planet, closed for good.

The club was famous for bacchanal excesses and women throwing caution to the
wind and all their clothes on to the floor. Founded in 1995, it was a monument
to Yeltsin's Russia. It closes just as that civilisation is collapsing.

After decades of sexual repression and po-faced Soviet puritanism, young
Russians caught up with their Western counterparts within the club's walls.
Then they went one better. For local nationalists, however, the club, which
was usually packed with expats as well as Russians, was Babylon, the Tower of
Babel, and Sodom and Gomorrah all rolled into one.

When a Communist member of the Duma visited the venue on a tour of clubs
recently, he was outraged to see "an American negro" stripping to the
accompaniment of the Soviet national anthem. A minor political scandal ensued.

For the club's Canadian manager, Doug Steele, the row, coming after months of
business problems and run-ins with the police, was the last straw. 

"The guy's not American and he wasn't stripping," he said yesterday. "I am not
disputing that the place was wild but it wasn't dangerous and people were just
having a good time. It's not worth banging your head against the wall of your
enemies for the rest of your life. I just regret not being able to say goodbye
to the 30 members of staff who no longer have a job."

Not only the staff, but thousands of patrons were mourning the club's passing
yesterday. Certainly, the sight, smell and sound of hundreds of sweaty bodies,
some dancing on the oval bar stark naked amid broken glass, spilt beer and
stray knickers, once experienced, are never forgotten.

*******

#10
Russian Weekly on Poll Results on Presidential Issues 

Argumenty i Fakty, No. 960
March 1999 (signed to press 16 March)
[translation for personal use only]
unattributed 
report from the "Vox Populi" column: "Nikita Mikhalkov Is Not Quite Up To 
Being a President"; passages within slantlines published in boldface 

Proposals to abolish the presidential post 
altogether or to somehow limit the president's constitutional powers have 
been often mentioned in Russian political circles. According to the 
latest poll conducted by the Public Opinion Fund, which polled 1,500 
people, two thirds of Russians (65 per cent) back the idea of limiting 
Boris Yeltsin's powers while 20 per cent are against this. 
A noticeably smaller proportion of the polled are in favour of 
amending the constitution in such a way as to limit the powers of the 
next Russian president, rather than Boris Yeltsin's personally (46 per 
cent on favour and 32 per cent against). 
A proposal to abolish the post of president in Russia as such has 
received a negative reply from three quarters of those polled (72 per 
cent) while 15 per cent supported the idea. The followers of Gennadiy 
Zyuganov [Communists] are the most ardent supporters of the abolition of 
presidency in Russia (23 per cent). 
The conclusion can be drawn that //in their majority, the Russians 
support presidential authority but would like to see a head of state with 
fewer powers than Boris Yeltsin has now// 
The media have been recently circulating the idea that film director 
Nikita Mikhalkov should be nominated for the Russian president. However, 
answering the question: "WHAT POLITICAL FIGURES WOULD YOU PERSONALLY 
NOMINATE FOR THE POST OF PRESIDENT?", only 1 per cent named Nikita 
Mikhalkov, about the same number as named Sergey Kiriyenko, Aman Tuleyev, 
Boris Nemtsov, Viktor Chernomyrdin and Alyaksandr Lukashenka. 
The following question was asked at the same time: "WOULD IT BE GOOD OR 
BAD IF NIKITA MIKHALKOV BECAME RUSSIAN PRESIDENT?". Two thirds of the 
respondents (63 per cent) answered "bad" and only 17 per cent thought it 
was a good prospect for the country. 
Significantly, it was people with higher education (78 per cent),
residents of
Moscow and St Petersburg (79 per cent) as well as major regional centres 
(76 per cent) that were mostly against the prospect of having Nikita 
Mikhalkov as president. And it was mostly young Russians who liked the 
hypothetical prospect of seeing Nikita Mikhalkov at the head of Russia: 
25 per cent of people under 35 think that "it would be good". 

******

#11
Russian Communist chief vows backlash if govt goes

MOSCOW, March 19 (Reuters) - Communist leader Gennady Zyuganov warned Russian
President Boris Yeltsin on Friday not to dismiss the government, saying he
would face protests across Russia and a backlash from the political opposition
if he did. 

Zyuganov made his remarks at a news conference after media speculation that
Yeltsin might reshuffle the cabinet and even dismiss Prime Minister Yevgeny
Primakov to reassert his own authority after months of illness. 

``If they (aides) bring Yeltsin a piece of paper (to sign) tomorrow and he
again starts reshuffling the government, then the day after tomorrow the
opposition may use all democratic means to form a government of people's
trust,'' he said. 

Zyuganov said the Communist Party, the biggest force in the lower house of
parliament, had set up its own ``structures'' in the regions and strike
committees at big enterprises in readiness. 

The Communists have generally supported Primakov, who is more conservative
than his predecessors, since confirming him as premier last September.
Primakov's first deputy in charge of the economy, Yuri Maslyukov, is a
Communist. 

Zyuganov said he had a lengthy conversation with Primakov on Thursday on a
wide range of subjects, but did not mention the question of the government's
dismissal among issues discussed. 

Commenting on a scandal surrounding Prosecutor-General Yuri Skuratov, Zyuganov
said he saw an ``attack against all the prosecutor's office'' behind it and
blamed it on liberals. 

``This group aims to bring down this government and remain at the helm, having
a sick president in the background,'' Zyuganov said. ``We will not allow this
to happen.'' 

Skuratov, who filed a resignation letter last month, told the upper house of
parliament on Wednesday he had been forced by political foes to offer to quit
and demanded the chamber's support. 

The chamber refused his resignation request. Several hours later, a state
television channel showed parts of a video tape showing a man looking like
Skuratov in bed with two young women. 

******