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Johnson's Russia List


March 23, 1999    
This Date's Issues: 3104 3105  3106 

Johnson's Russia List
23 March 1999

[Note from David Johnson:
2. Reuters: Yeltsin sends START-2 to Duma for ratification.
4. Reuters: Russia must follow through on reforms--Summers.
5. Moscow Times: Jean MacKenzie, CONFESSIONS OF A RUSSOPHILE: So Long to
That's Russia.

6. Reuters: Before U.S. trip, Russia PM condemns anti-Semitism.
7. Dale Herspring: Surealism.
8. Peter D. Ekman: RE: Reddaway and Glinsky.
9. Bill Mandel Re: 3102-Reddaway and Glinsky/Chance for Democracy.
10. New York Times editorial: Primakov Comes Calling.
11. Moscow Times editorial: Primakov Must Tread Softly in U.S. 
12. Financial Times editorial: Russia's debt.
13. New York Post editorial: Primakov the Extortionist.
14. Heritage Foundation: Ariel Cohen, Primakov’s Washington Visit: 
Not the Time for More IMF Credits.


17. Izvestiya: The American Dream of Primakov. 
18. Komsomolskaya Pravda: Skuratov and His Babes, or What Is Right and
What Is Wrong.
19. Novye Izvestiya: Family with a Strict Regime.] 



MOSCOW, March 22 (Itar-Tass) - Leader of the "Yabloko" movement Grigory
Yavlinsky compared the current "gigantic crisis in the political elite"
with the situation which preceeded the August 1991 coup against Soviet
President Mikhail Gorbachev and the suppression of the armed mutiny of
the Russian parliament in October 1993.
He said he pins hopes for the resolution of the crisis on Prime
Minister Yevgeny Primakov.
"A very serious political crisis is coming in Russia. The arms of
authority are gradually entering a stand-off and contradictions among
themselves. The pyramid of power is shaken by internal problems. That
is a very dangerous thing. It was characteristic of 1991 and 1993", he
told the TV-6 network.
"The most important person in this situation is the prime minister.
Today much depends on how Primakov acts. It depends on him how deeply
the crisis will develop", Yavlinsky said and explained that Primakov
has "to keep balance" between political forces and "do not allow the
boat to turn on the leftist /communist/ side".
"As soon as he begins making practical steps in this plan, the
situation will begin to improve", according to Yavlinsky.
He believes that the emerging contradictions, in particular, between
the president and the upper house of the parliament over the dismissal
of the prosecutor general, as well as among the so-called "oligarchs",
allow the communists to "feel themselves confidently and just
He believes President Boris Yeltsin, in order to restore popular trust
to authorities, has to immediately fire those who are "accused of
corruption and who discredit the power"."That step is to be immediately
made", Yavlinsky urged.
"Active work by Primakov and the president is necessary to ease
tensions so that we live up to elections. And the elections will be the
final decision on what happens in Russia in the next century",
Yavlinsky said.
He stressed that he was ready "to constructively cooperate" with the
government of Primakov, if the economic policy is changed.
"If Primakov decides to form a new economic policy, we shall be ready
for serious talks and for participation in the government", he said,
but refused to disclose whether he would agree to become a vice-premier
in the cabinet of Primakov.


Yeltsin sends START-2 to Duma for ratification

MOSCOW, March 22 (Reuters) - Russian President Boris Yeltsin on Monday
submitted the 1993 START-2 nuclear arms reduction treaty to the State Duma
(lower house of parliament) for ratification, a Kremlin spokeswoman said. 

The move came after the opposition-dominated chamber finally agreed last week
to consider ratifying the Russian-U.S. treaty after a long mainly politically
motivated delay. 

The Duma's decision gave a boost to Prime Minister Yevgeny Primakov, who
generally enjoys the chamber's backing, ahead of his trip to Washington this
week. Ratification could help Russia's cause in getting much-needed new
foreign loans. 

Itar-Tass news agency quoted Yeltsin's spokesman, Dmitry Yakushkin, as saying
the president had sent a new version of the ratification law, which includes
some conditions put forward by parliament, to simplify the approval process. 

One known condition is an immediate start to work on a START-3 treaty allowing
further reductions in U.S. and Russian arsenals. Deputies say they may also
seek foreign cash before approving START-2 to help finance Russian

Yakushkin said the law provided ``a possibility to control the implementation
of this very treaty as well as other treaties in the field of strategic
offensive armaments and anti-ballistic missile systems.'' 

Russia is concerned by recent signals from the United States that Washington
wants to alter the 1972 U.S.-Soviet Anti-Ballistic Missile treaty, which
Moscow sees as a cornerstone of world nuclear deterrence. 

START-2 slashes the two countries' Cold War nuclear arsenals by up to two
thirds to no more than 3,500 warheads each by 2007. 



MOSCOW, March 22 (Itar-Tass) - First Deputy Prime Minister Yuri
Maslyukov believes that there are not enough grounds for Russia to
change its attitude towards the anti-Ballistic Missile (ABM) treaty.
Anton Surikov said Maslyukov had dismissed such reasons as
"insufficiently considered".
Maslyukov's statement came in response to media reports that Washington
is going to unroll a national anti-missile system which does not wholly
correspond the Soviet-U.S. treaty signed in 1972.
Some Russian experts have said Moscow should agree to the idea of
cancelling the treaty and team up with Western nations forming
anti-missile defences to protect themselves from threats that could
possibly come from the Middle East and northern Africa.
However, Maslyukov thinks that its is "barely achievable in current
conditions to find the money in the federal budget to finance Russia's
share in the work on setting up a hypothetical joint ABM system",
Surikov said.
"Defence spending has sharply been cut and this situation will last
long," according to him.
"The Russian government has to transfer finances, of which there is a
permanent dearth, to the top priorities such as the Topol-M missile
complex, liaison and guidance systems, warning equipment, informational
support, and crucially important types of conventional weapons," he
In such circumstances, "the shifting of money to the solution of ABM
tasks will inevitably bring about disruption of financial supplies in
other spheres of national defence and cause an irrevocable degradation
of the still militarily capable strategic nuclear force", he said.
Besides, Maslyukov stressed that "the nuclear-missile threat to Russia
from 'third world' nations is being greatly overblown".
To make Russia feel safer, "it is necessary to boost the international
non-proliferation of nuclear arms and toughen control over the export
of technologies which can be used for the production of weapons of mass
destruction", according to him.
The government is "ready for broad international co-operation in the
field of export control and set to fulfil all of its duties," he said,
adding that would be "more preferable than binding the country into a
race of strategic defence armaments".


Russia must follow through on reforms--Summers

WASHINGTON, March 22 (Reuters) - U.S. Deputy Treasury Secretary Lawrence
Summers said on Monday it was crucial that Russia implement a strong program
to reform its ailing economy. 

"Clearly what's most important for Russia is that Russia carries through a
strong reform program," he said after delivering a speech to a conference of
the Tax Executives Institute. 

"I expect that will be an important part of the economic discussions that U.S.
officials will have with Prime Minister (Yevgeny) Primakov this week," Summers
told reporters. 

Asked how Russia was doing, Summers replied, "We'll have to see." 

Primakov arrives in Washington this week for talks that will include the vexed
issue of the International Monetary Fund's stalled loan program to Russia.
Primakov is expected to ask the U.S. Treasury to get the program restarted. 


Moscow Times
March 23, 1999 
CONFESSIONS OF A RUSSOPHILE: So Long to All That's Russia 
By Jean MacKenzie (

Is there life after Russia? With less than 24 hours to go before
departure, I am becoming obsessed with the question. This is not the first
time I have left this place "forever." You'd think I would be used to it by
now, but it's not getting any easier. 

I seem condemned to exist in a constant state of anguish: I am either
living here and wishing I were somewhere - anywhere! - else, or I am
sitting in various European or American capital cities pining for the
excitement and craziness of Moscow. 

Where else do you get up every morning wondering whether the government
will fall, the currency crash, the president survive, or the banks close? 

Where else does the weather jump from 25 below to 10 above in two days?
Where else can you go from joy to despair and back again just trying to do
your grocery shopping? 

I recently read a rather good book in which the author describes Russia as
a country where people "live very mundanely on the edge of the abyss." That
pretty much sums it up for me. But once you get used to a yawning chasm
beneath your feet, solid ground comes to seem a little too tame. 

Two years ago, emotionally and physically drained by five years as a
Moscow journalist, I left, vowing never to return. 

I must have had my fingers crossed, though, because within a year I was
back. Once my hair and skin had recovered from the assault of Moscow's
harsh water and harsher air, once my body had shed the effects of a steady
diet of pelmeni and bliny, when I no longer had nightmares about the metro
and had become used to cars stopping to let pedestrians cross the street, I
began to miss the gaping void. 

For the past 14 months I have been happily bathing in political turmoil
and economic crisis, but it is all starting to seem like a repeat of things
past. Falling ruble, rising prices? I was here in 1992, with 2,500 percent
inflation. Political crisis? I can still recall the boom of the tanks
shelling the White House in 1993. 

The final straw came when a colleague of mine said, "You'd be crazy to
leave before the Duma and presidential elections. Things are just getting

I had heard those exact same words before, when I was thinking of leaving
in 1995. I had an instant flash-forward to 2015, still trying to get away,
still hanging on for the next election campaigns. So I've decided it's time
to head for the next phase of my life, whatever that may be. 

But it seems that Russia makes one totally unfit to survive anywhere else.
"It may be a bardak [brothel, chaos] but it sure is veselo [cheerful],"
laugh my Russian friends when I begin to whine about my upcoming exile.
"Don't worry, you'll never leave for very long." 

That no longer sounds like a casual prediction. It has more the ring of a
life sentence. 

I am, of course, far from the only one in this boat. I have been receiving
tons of e-mail from recent departees, and it is not encouraging. "Once you
get out of New York, America is one long shopping mall," writes Jamie, a
journalist who left last summer and is now plotting her escape from the Big
Apple back to Russia. 

"I should have stayed there. Life here is so boring!" wails another
friend, now stuck in Dallas and contemplating a prolonged stretch in Nepal. 

"I envy you your exciting life," sighs Natasha, a Russian living in Norway. 

Her mother has just arrived from Kharkov to stay and has just two topics
of conversation: how awful everything is in Ukraine and how unhappy she is
to have left it for clean, sane, "provincial" Scandinavia. 

So it is with mixed feelings that I pack my bags, say my goodbyes and head
West. I have a book to finish, a personal life to straighten out, and a lot
of soul-searching to do before I make my peace with Russia. 

There is a fine line between a "russophile" and a "russoholic," and no one
has yet devised a 12-step program to help us out of our dependency. 

Love of this fascinating, infuriating country can easily become an
addiction to its very untidiness, its preference for confusion over
efficiency, its professed disdain for material well-being, its much vaunted
"soulfulness," and its endless suffering, often self-inflicted. 

Throw me a rope. I'll make it out of this abyss yet. Better still, watch
this space - I may be back. 


Before U.S. trip, Russia PM condemns anti-Semitism
March 22, 1990

MOSCOW (Reuters) - Prime Minister Yevgeny Primakov Monday condemned a
rising tide of anti-Semitism 
in Russia and told a visiting delegation representing the U.S. Jewish
community that his government 
would clamp down on such intolerance. 

Speaking to members of the influential Anti-Defamation League (ADL) before
a trip to the 
United States, Primakov singled out Communist lawmaker Albert Makashov for
criticism over anti-Jewish remarks he has made at public rallies. 

"I say unambiguously that the government takes a very strong position
against any manifestation 
of nationalism, including anti-Semitism," an ADL statement quoted Primakov
as saying. 

"I believe Makashov has to be condemned fair and square and unambiguously
for his 
pronouncements in an open and undisguised way," Primakov was quoted as

Primakov was due to leave for Washington later Monday for talks with
President Bill 
Clinton, Vice President Al Gore and officials from the International
Monetary Fund and World Bank. 

Primakov, who held talks earlier Monday with visiting Israeli Prime
Minister Benjamin Netanyahu, said 
he supported anti-fascist and anti-extremist legislation now before the
State Duma, Russia's lower house of 

It was his first public statement against anti-Semitism since he become
prime minister six 
months ago. 

The Duma, dominated by the Communist Party, failed for a second time last
to censure Makashov for saying Jews should be rounded up and jailed for
what he 
called their responsibility for Russia's economic woes. 

ADL leaders said they warmly welcomed Primakov's statement. 

"His had been a voice missing in condemning anti-Semitism in Russia. I
think this 
is an important statement on the eve of the prime minister's trip to the
States," Abraham Foxman, national director of the ADL, told Reuters. 

But Foxman said the ADL remained concerned that there had been no arrests
the series of anti-Semitic statements. 

Foxman said his delegation would hold talks Tuesday and Wednesday with
more Russian leaders. 

"We want to share our methodology with the Interior Ministry on ways of
intolerance. There is no vaccine against this disease but we are ready to
help with 
our experience," he said. 

The ADL, founded in 1913, fights anti-Semitism worldwide and lobbies for
Jewish causes in 
the United States. 

Primakov may have avoided open criticism of Makashov until now because he
needs Communist 
support for his government to get laws through the Duma. 

Primakov told the ADL delegation he wanted Russia's Jews to feel at home in 
Russia but said his government would never stand in the way of Jews who
to leave. 

About one million Jews have moved to Israel from the former Soviet Union in 
the past decade. Israel's Netanyahu Monday hailed their contribution to the
Jewish state's economic, cultural 
and scientific life. 


Date: Fri, 19 Mar 1999 
From: Dale R Herspring <>
Subject: Surealism

I just returned from a meeting with a number of senior Russian
officials. While I learned a considerable amount through our discussions,
I must also admit that there is a certain sense of surealism about such
meetings. We talk about specific problems -- like the dismantling of
Russian submarines -- or the Russian ship building industry -- but the
bottom line is that they all have a certain sense of un-reality about
them. When push comes to shove, the value of such conversations is
seriously limited by the instability of the current political/economic
situation. No one knows what will happen tomorrow let alone next week or
next month. How could anyone take plans for the future seriously? The
issue of military reform is a perfect example. The General Staff is busy
turning out one paper after another on what should be done and how Russia
should do it. Yet, these papers have little or no relevance if there is
not the stability, funds and political will to carry them out.
Please don't misunderstand me. I also write papers trying to understand
where things are going in Russia and I will no doubt continue to do so in 
the future. My point is rather simple. We must be careful not to think
that many of the plans, papers and studies we see and read represent
reality or are likely to become reality. As long as Yeltsin continues to
hang around (perhaps in an effort to prove that he will be the first head
of state mumified while still in office in some time), and as long as we
see musical chairs at the top and a further drift away from central
control at the periphery, I suspect our efforts to figure out where Russia
is going will be "stabs in the dark" at best.
A rather humbling realization, but perhaps one that we all need to take
into consideration when we are trying to suggest ways out of Russia's
current mess. As Marx noted, it is hard to fix a country's
superstructural problems when the sub-structure is in what amounts to


Date: Mon, 22 Mar 1999 
From: "Peter D. Ekman" <> 
Subject: RE: Reddaway and Glinsky

Reddaway and Glinsky's piece in JRL 3102 saying that the IMF must give
Russia a loan
is based to a very large extent upon the assumption that, "anti-Western
sentiment among ordinary Russians ... (is) rising." During my nearly 5
years in Moscow, I've never seen anti-Western sentiment among ordinary
Russians. Certainly among politicians there is some "America-bashing," but
probably of about the same amount as U.S. politicians engage in
If anybody sees any concrete "anti-Western sentiment among ordinary
Russians" please send me a note at I bet I won't see any
credible examples for a long time. 


Date: Mon, 22 Mar 1999
From: Bill Mandel <>
Subject: Re: 3102-Reddaway and Glinsky/Chance for Democracy

Reddaway and Glinski are mistaken in two respects. If the 
debts are not forgiven, it is not today's Russians children 
alone who will be paying, but their grandchildren and 
greatgrandchildren. Look at the history of the U.S. national 
debt's components. The consequences of this in Russians' 
attitudes toward us cannot be overestimated.
Secondly, there was never the intention to remake Russia 
in the American image. The intention was to reduce it to 
Third World status. That nearly succeeded.


New York Times
22 March 1999
Primakov Comes Calling

In the seven months that he has been Russian Prime Minister, Yevgeny
Primakov has restored a measure of stability to his shaken nation. Under his
cautious leadership, Russia has avoided the civil unrest and collapse of
central authority that seemed possible in the chaotic days after the ruble was
devalued last summer. But as Mr. Primakov heads to Washington this week, he
remains a caretaker figure with a socialist tint who is mostly marking time
until a new president, possibly Mr. Primakov himself, is elected next year. 

Mr. Primakov, a wily but amiable veteran of the Soviet bureaucracy, has
little governing latitude. He is caught between an ailing and erratic
President, Boris Yeltsin, and a benighted and cranky Parliament dominated by
Communists. Mr. Primakov has navigated these rapids by pursuing a foreign and
domestic agenda that recalls Mikhail Gorbachev's early years in power, when he
was still confident he could make socialism work and assert Soviet power
abroad while diminishing tensions with the West. 

In foreign affairs, his area of expertise, Mr. Primakov has pressed
traditional Russian security interests in Europe, Asia and the Middle East
more vigorously than Mr. Yeltsin's previous prime ministers, but has not so
far fulfilled fears in Washington that he would oppose the United States at
every turn. For the moment, at least, he is working with the Clinton
Administration on several fronts to limit the spread of nuclear weapons and
technology, one of the issues he will discuss with President Clinton and Vice
President Al Gore. The escalating crisis in Kosovo promises to test his
tolerance for cooperation with the United States, especially if NATO takes
military action against Serbia, a longtime Russian ally. 

Mr. Primakov's economic program borrows heavily from failed Soviet formulas
without entirely giving up on the market forces that have developed in Russia
in recent years. This is hardly surprising, since the price for his
confirmation by Parliament was that he place economic policy primarily in the
hands of Yuri Maslyukov, a Communist retread. 

The Government is still failing to collect taxes and operating with a budget
plan that bears little relation to economic realities. Over time, these
policies will further stunt development, and they have done nothing to reverse
the economic decline that accelerated last fall. But they have eased the
financial panic that threatened to engulf the country. Because Russia has not
printed enough rubles to pay all its bills, inflation has not risen out of
control. Many Russians are thankful for the relative calm, and relieved that
Mr. Primakov is concerned about the inequities produced by Russia's unbridled,
criminal-infested brand of capitalism. 

In negotiations with the International Monetary Fund, and in discussions
about how Russia will treat the creditors who made the mistake of lending to
it last year, Mr. Primakov's Government has taken a surprisingly haughty
attitude. It has delayed telling the creditors how they will be able to invest
the small amount of money they are being allowed to recover and has demanded
that the I.M.F. provide new loans without asking too many questions. President
Clinton and the I.M.F. should resist this pressure until Mr. Primakov puts the
economy back on a reform path and the I.M.F. is satisfied that its loans will
not be diverted to private, off-shore bank accounts. 

Mr. Primakov, like his predecessors, can never be sure whether Mr. Yeltsin
will suddenly fire him. The political turmoil in Moscow over Mr. Yeltsin's
effort to dismiss the country's top prosecutor, Yuri Skuratov, has added to
the uncertainty. In such conditions, Mr. Primakov and his countrymen will be
fortunate to get to the next presidential election without another change of
cast in the Kremlin. Given the dangers of political instability in a nation
with thousands of nuclear weapons, that may be the most Washington can hope
for as well. 


Moscow Times
March 23, 1999 
EDITORIAL: Primakov Must Tread Softly in U.S. 

Prime Minister Yevgeny Primakov faces an unusually delicate mission as he
travels to Washington on Tuesday for crucial meetings with U.S. officials
and the International Monetary Fund. 

Primakov is trying to win U.S. financial support for Russia's stricken
economy while at the same time stressing Russian opposition to the
threatened U.S.-led bombing of Yugoslavia. 

Russia's response to the crisis last fall over the U.S. and British
bombing of Iraq offers some tips both on what to do and what not to. 

On one hand, Primakov can draw the lesson from the Iraq crisis that Russia
is often justified in opposing U.S. policies. 

The U.S. and British bombing of Iraq was designed to weaken Saddam
Hussein's regime and force him to cooperate with United Nations disarmament

But the bombings have proved of little value on the ground. Saddam remains
in power and UN weapons inspectors are barred from Iraq. Russia was in line
with France and China in opposing the bombings. Many in the United States
doubt the policy. 

But the other lesson for Primakov from the Iraq crisis is the importance
of matching a diplomatic response to the importance an issue has for the
national interest. As a fallen superpower, Russia should husband its
diplomatic resources for truly important issues. 

In the case of Iraq, Russia's protests against U.S. actions were excessive
and ridiculous. Russia recalled its ambassadors and mobilized naval forces.
These histrionics led to an inevitable humiliation when Russia sent back
its ambassadors after barely a weekend of Cold War. 

With this experience in mind, Russia must respond firmly but moderately to
the current crisis in Kosovo. However certain it may be of its diplomatic
advice, Russia should not get carried away. 

Many in NATO are already aware of how risky it would be to bomb Serbian
targets over Kosovo. It would amount to unsanctioned aggression against a
sovereign state battling separatism. And after the bombing, what then? NATO
does not want the Serbs to suppress the Kosovars but neither does it want
independence for Kosovo. Is NATO willing to commit ground troops into such
an inherently unstable situation? 

Primakov can make all these points in a serious, diplomatic manner.
Friends can disagree. But he should cast aside the silly, great-power
obsessions and rhetoric of the nationalist wing of Russian politics.
Sympathy for Slav brothers is not a vital national interest. The IMF and
good ties with the West are. He can salvage national honor without
sacrificing national interests. 


Financial Times
22 March 1999
Russia's debt

Yevgeny Primakov, the Russian prime minister, is off to Washington. His aim
is to persuade the White House and the International Monetary Fund that
Russia needs cash. But the IMF should not throw good money after bad. The
US administration should refuse Mr Primakov's plea to lean on the Fund.

The IMF's $23bn lending programme to Russia failed dramatically when the
government devalued the rouble and defaulted on its domestic debt last
August. The IMF suspended lending then. It should not start again now.
Unhappily, this means that Russia will default on its IMF debt. This cannot
be helped.

At the heart of Russia's economic crisis is a state which is ineffective
and dishonest. The best that can be said of Mr Primakov's
communist-dominated government is that things have not got much worse.
Although annual inflation topped 100 per cent in January, Russia has not
descended into the hyper-inflationary chaos many expected.

The sorry state of the government's finances means that the threat of chaos
remains. Haggling over the size of the projected primary surplus with the
IMF would miss the point. The government's budget plans are largely a work
of fiction. It is unwilling and unable to collect taxes, or to impose
discipline on the "oligarchs" of big business. It cannot pay its bills,
pensions or wages. The only way to clear the backlog would be to run the
printing press at full throttle.

The inability to raise taxes is also the reason Russia has run up $50bn
debts - on top of its existing Soviet-era debt - that it cannot pay. It has
already stopped servicing its domestic debt. While western banks bargain to
get a fraction of their money out, many Russians who invested in government
securities have lost their savings.

Despite a healthy trade surplus, capital flight means that Russia's
reserves are also running out. Michael Zadornov, the finance minister, says
that without the IMF's help, the government cannot service its foreign
debts. It needs $4.8bn (Ł2.9bn) to service its IMF and World Bank debt this

The argument used in the past for continuing Russian loans - that, despite
the corruption, the money at least supported reform - no longer applies.
There are no heavyweight reformers in the government. There is no real
commitment to clearing up the public finance mess, or to sorting out the
rotten banking system.

As for President Yeltsin, he is no longer able to fulfil his constitutional
role. If he put the country's interests first he would resign immediately.

Failing that, there is no chance of progress this side of next year's
presidential elections. Mr Primakov, a former intelligence supremo, seems
to be doing a good job of managing stagnation and worrying the Clinton
administration with threats of doom if Russia is not bailed out yet again.
But nothing more.

If the US wants to give money for political reasons, it should do so. But
the IMF should not agree to new loans. That would amount to taking money
out of one pocket simply to prevent Russia from defaulting on existing
loans from the fund. Fiddling the books to disguise the fact that loans are
bad is the sort of behaviour that is deplored in commercial banks. It must
not become official IMF policy. 


New York Post
22 March 1999

This week, a man who is arguably the West's most tenacious enemy in the former
Soviet Union arrives in Washington - and if the Clinton administration and
others aren't careful, they could make him the next president of Russia. 
The man in question is Yevgeny Primakov, Russia's prime minister. Primakov
the reins of power in that chaotic country last fall after the Russian
collapsed. Primakov's ascension was a heartbreaking development because he is
the leading representative of the nomenklatura - the corrupt and vicious elite
that ruled the Soviet Union in its last two decades. 

Less than seven years after the disintegration of the Soviet Union, Mother
Russia was looking once again for leadership to the men who ran and profited
from the most brutal system of government the world has ever known. 

Sad - and frightening, too, because the communist remnant has never reconciled
itself to the fact that Russia is simply not a superpower in the way the
Union was. Primakov, who was foreign minister before he became prime minister,
has spent the 1990s doing everything he can to thwart Western efforts at

Primakov has served as Saddam Hussein's only friend since the days before the
Gulf War. And he has backed the unconscionable conduct of Yugoslav strongman
Slobodan Milosevic against the attempts by the West to halt Milosevic's
for, and encouragement of, genocide. 

It's a mark of how far Moscow has fallen that the West's resolve has remained
firm, despite Primakov's efforts on behalf of murderers and imperialists. But
Russia still possesses a massive stockpile of nuclear weapons of all kinds -
and a resurgent Russia is a terrifying prospect indeed. 

That's what Primakov is counting on as he arrives in Washington with
outstretched palm in hopes that the Clinton administration and its friends at
the International Monetary Fund will fork over several billion dollars in
"loans." The formula is simple: Pay me or I'll get mad. 

The administration and the IMF have shown themselves disastrously prone to
siren calls: They've forked over billions to North Korea to bribe Pyongyang
into being nice. It hasn't worked, because that's not the kind of negotiating
that communists like the North Koreans - and Primakov - understand. 

If Primakov goes back to Russia with Western goodies, he will have a leg up in
next year's elections. The last thing the West should want is a President
Primakov. Let him go back to Moscow with empty hands. 


From: "Cohen, Ariel" <>
Subject: Cohen's EM (no. 581) on Russia/IMF loans
Date: Mon, 22 Mar 1999 16:33:37 -0500

Dear David:

Here's the Heritage Foundation Executive Memo #581 published today dealing
with Primakov's visit to the US and the issue of further IMF loans.

Hope you can share it with your readers.


Primakov’s Washington Visit: Not the Time for More IMF Credits
(AUTHOR) Ariel Cohen, Ph.D.

On March 22, 1999, Russian Prime Minister Evgeny Primakov visits
Washington, D.C., for a summit with Vice President Al Gore. His main
purpose is to ensure the Clinton Administration’s support for new
International Monetary Fund (IMF) loans to Russia. Russia seeks these new
credits even though that it has defaulted on most of its foreign loans
since the August 1998 ruble crisis. Russia has threatened further default
on its debt if the IMF does not provide the new credits. Supporting new IMF
loans or the unconditional rescheduling of Russia’s debt is not the best
course for the United States to consider. Nor is forgiving one-half of the
$90 billion Soviet-era debt, as Russia’s Ministry of Finance suggests.

Americans are questioning the reason that the United States should support
new IMF credits to Russia. The latter’s lack of coherent economic policies,
along with the statist mindset of Primakov’s cabinet, will make any new
credits or other Western largesse wasted efforts. IMF bailouts amounting to
$27 billion since 1992 have failed. Additional IMF credits aimed at saving
the economic status quo will prolong the agony, postpone the day of
reckoning, and perpetuate the poor conditions under which Russian and
foreign businessmen must work. Moreover, because Russia has shown little
inclination to support the United States over international security
issues, new credits in effect would reward Russia for its anti-U.S. stance.

Before the United States considers giving Russia another dose of IMF
anaesthesia, the Vice President should ask Primakov to temper his
opposition to U.S. security concerns. For example, why should Russia’s debt
be forgiven when it continues to proliferate ballistic missile and nuclear
technology to states like China and Iran or go against the will of the
United Nations to support Saddam Hussein’s regime in Iraq with illicit
weapons? If Russia wants further aid, Primakov should explain the reason
that Russia opposes the United States on issues like enlarging the North
Atlantic Treaty Organization and intervening in Kosovo, as well as the
reason it supports Serbian leader Slobodan Milosevic despite many
documented atrocities. Primakov also should explain the reason that Russia
refuses to ratify the Strategic Arms Reduction Treaty (START) II. Finally,
Primakov should explain the reason that Russia spends billions of dollars
modernizing its strategic weapons arsenal while millions of Russians remain
impoverished and hungry.

(HEADING 1) The Roots of the Crisis
The strategic goal of U.S. Russia policy should be to facilitate Russia’s
integration into the global economy and international community. The West
should encourage Russia to implement realistic and responsible foreign
policies and economic strategies that are in the interests of not only the
United States and the world, but of Russia as well. To do this, Russia will
need to come to grips with the twin legacies of its Soviet past: A
superpower ambition, with its reflexive hostility toward the United States,
and a costly military-industrial complex that survives to this day. The two
are interdependent and undermine both economic reform and Russia’s
integration into the global community.

Russia’s attempts to define itself as a successor to the Soviet Union’s
superpower status and a challenger to the United States puts it on a
collision course with the West over important issues, including Kosovo,
Iran, and Iraq. Geopolitical games force Russia’s leaders to maintain and
modernize a large military-at great expense to the country’s impoverished
taxpayers. Finally, great power aspirations entice Russia’s leaders to
attempt to create alliances with China, India, and Iran. But such alliances
contribute little to Russia’s dire economic straits, however, and make
decision makers in the West cautious and suspicious.

The military-industrial complex that is necessary to support Russia’s great
power aspirations is an immense drain on the country’s economy.
Russian-made products are not competitive in the global market, and the
country’s industrial base is plagued by barter arrangements that distort
market value and deny the state tax revenue. This virtual economy is
supervised by First Deputy Prime Minister Yuri Maslyukov, the last
Soviet-era chief of central planning and a lobbyist for the
military-industrial complex, and Viktor Gerashchenko, the Chairman of the
Central Bank. They are working to revive such Soviet-style policies as
price controls and industrial subsidies. So long as they are in office,
little will change to lift Russia from its economic quagmire.

The first step to improve the economic situation of ordinary Russians is a
difficult one: complete the dismantling of the Soviet-legacy socialist
economy. Even senior officials at the IMF and the World Bank compare
Russia’s dependence on Western credits to a drug addiction. New IMF credits
would be wasted, as a recent scandal involving the Financial Investment
Management Company (FIMACO), an offshore company set up by the Central
Bank, demonstrates. According to the Russian Prosecutor General and the
State Duma, FIMACO siphoned up to $50 billion of Russia’s currency
reserves. A full-scale investigation of these fraudulent activities should
be conducted.

(HEADING 1) A Fresh Start
If Russia wants additional aid from the United States and the West, it must
act consistently as a responsible member of the international community,
cooperate with the United States, and reform its economy. These actions
should include putting strong anti-proliferation measures in place with
specific timetables and verification regimes to deal with Russian companies
that contributed to weapons programs in Iran and Iraq. The Clinton
Administration needs to make clear that, so long as Russia continues to
assist U.S. foes and remains recalcitrant in opposing vital U.S. interests,
it is neither fair to the American people nor in their interest to
facilitate debt relief for Russia.

To reform its economy successfully, Russia will need to implement new
economic policies. This will require a highly competent, free
market-oriented economic team that will develop a comprehensive program to
restructure Russia’s economy. So long as the current team remains in power
and continues its neo-Soviet approach, debt restructuring will be a waste
of time and valuable resources and only will perpetuate the problems. To be
effective, Russia also needs to implement an unprecedented crackdown on
crime and corruption.

For Russia to continue its current policies while asking Americans to
support its habits with additional IMF loans is like giving cocaine to an
addict. On the other hand, if Russia implements genuine economic reforms
and demonstrates responsible international behavior, then the United States
should be willing to reconsider the issue of debt rescheduling.

-Ariel Cohen, Ph.D., is Senior Policy Analyst, Russian and Eurasian
Studies, at The Kathryn and Shelby Cullom Davis International Studies
Center of The Heritage Foundation.



MOSCOW, March 22 (Itar-Tass) - Nationalities Minister Ramazan
Abdulatipov warned that Russia will inevitably face new conflicts and
new victims if it does not stop the chaotic development of ethnic
relations on its territory.
Speaking at a press conference on Monday, Abdulatipov said that "we
have exhausted ourselves as a country where the freedom of everything
and everyone was proclaimed. We must put things in order in the field
of ethnic relations, because any chaos hits the peoples of Russia and
the country as a whole."
He believes that federal authorities are still "using the worst version
of colonial rule" in ethnic republics, primarily in the Caucasus,
trying to win over their leaders, while ignoring the needs of the
As a result, people in regions turn their anger against federal
authorities who automatically become involved in conflicts as one of
the parties, not as an arbiter, he explained.
Abdulatipov believes that the federal government cannot claim the "most
intelligent" title as 95 percent of all problems in ethnic republics
should be solved in situ, while Moscow should get only agreed-upon
The minister regretted the lack of a coordinating centre for Russia's
policy in the North Caucasus, adding that the government remembers his
Nationalities Ministry "only when something explodes or happens
somewhere" and does not use it for preliminary consultations.
Abdulatipov said his ministry has prepared the text of a presidential
degree on the responsibility of government officials for fomenting
internecine strife. The draft decree has already been handed over to
the presidential administration.
In addition, Russian Prime Minister Yevgeny Primakov has instructed the
Nationalities Ministry to return to the problem of refugees from



MOSCOW, March 22 (Itar-Tass) - The volume of trade between Russia and
the United States in 1998, as compared with 1997, increased by 7.7 per
cent and amounted to 9.5 billion U.S. dollars.
In the last few years the trade turnover has grown, as compared with
1992, more than 2.5 times. At the expense of rising rates of growth of
export Russia from 1994 has a favourable balance of trade with the
United States which in 1998 came to 1.2 billion U.S. dollars, a
representative of the press service of the Trade Ministry of the
Russian Federation told Prime-Tass here on Monday.
In terms of the size of the trade turnover the United States occupied
in 1998 the second place (after Germany) in the Russian trade with
foreign countries. The U.S.A. accounted for 6.2 per cent of the total
foreign trade of the Russian Federation.
For the United States the role of trade with Russia is not great --
Russia's share in the aggregate volume of American foreign trade is
only about 0.5 per cent.
The basic products of Russian export to the United States, which in
1998 amounted to 5.35 billion U.S. dollars, just as in the past years,
are raw materials. They account for about 85 per cent of Russian
deliveries. Russia's export is represented mostly by ferrous metals,
aluminium, pearls and precious metals, chemical products and
fertilizers, oil and oil products, titanium and articles made of it.
In Russia's imports from the United States, the volume of which in 1998
amounted to 4.15 billion U.S. dollars, the main place belongs to
commodities of the machine-building industry, foodstuffs and
agricultural raw materials, as well as tobacco articles.


Russia Today press summaries
March 22, 1999
Lead Story
The American Dream of Primakov 
Prime Minister Yevgeny Primakov's visit to the U.S. this week will take
place against a complicated background created by both sides, the daily

In Moscow, political leaders are certain that only political decisions will
bring credit negotiations with the International Monetary Fund out of
their dead end. However, the U.S. administration is unlikely to exercise
its political will at present. The daily recalled how last fall, U.S.
President Bill Clinton made a great effort trying to talk Congress into
clearing the way for U.S. funds for the IMF. At the time, Russian
President Boris Yeltsin emphasized that he was not asking for money from

Now, however, the situation is worse, because Russia is asking for money
and the government is weak. 

According to the daily, there are two possible outcomes for Primakov's
upcoming visit. If the Russian team does not agree to major concessions,
Washington may refuse to help it obtain IMF credit, citing alleged
misappropriation of the last IMF credit tranche to Russia. But, if the
concessions seem "reasonably sufficient," the U.S. may solicit a credit
allocation for Russia, arguing that if not, possible chaos in Russia could
cost American taxpayers much more. 


Russia Today press summaries
Komsomolskaya Pravda
March 22, 1999
Skuratov and His Babes, or What Is Right and What Is Wrong 
The daily commented on the recent scandal regarding the resignation of
Prosecutor-General Yury Skuratov, which was approved by President Boris
Yeltsin but rejected by the Federation Council. 

The conflict was further fueled by television broadcast of a videotape,
which allegedly showed Skuratov in bed with two prostitutes. 

The daily asked a number of rhetorical questions: Was it right for the
Prosecutor-General to have sex with two women in a secret apartment? Was it
right to set up a camcorder and shoot a video of his sexual habits? Was it
right to blackmail Skuratov by showing this recording at the Federation
Council and was it right for a state television channel to show the video
to the entire country? And was it right for state official Skuratov to
take back his own letter of resignation? According to the daily, the
answer to all these questions is obviously "no." 

The presidential commission set up to investigate the scandal will not help
repair the damage done by both sides, the daily noted. It is too late to
accuse Skuratov of perjury, because every state official in the country has
committed perjury of his own kind. It would have been much better if the
president, the prime minister and the chairmen of both houses of parliament
would meet and come to agreement, saying quietly: "Do we want to live,
guys? Do we have a bit of sense and responsibility left? Then let us stop
at this." 

The daily wrote that those in power would do better to put a hold on their
quarrels, because otherwise Russia will be faced with barricades instead of


Russia Today press summaries
Novye Izvestiya
March 22, 1999
Lead Story
Family with a Strict Regime 
According to recent findings, violence occurs in half of all Russian
families, the daily wrote. 

About 30 percent of the premeditated murders are committed within families,
and in half of the cases, a long history of family conflicts preceded
crimes of domestic violence. 

In the Soviet Union, domestic violence was a secret issue. Officially, the
problem was only recognized six years ago. Since then, 30 organizations,
including six state organizations, have been established to grant
assistance to victims. 

The police do not provide help to women who are beaten by family members or
relatives, the daily noted. Only rarely do they detain men in such cases
-- usually for a day, after which he returns home and punishes his family
for reporting him. And, according to the daily, many women are unwilling
to report their husbands for violence, because they are aware of the
terrible conditions in Russian jails. 

Russian women cannot count on real support from the state. They rarely have
their own separate housing, and so have to endure humiliation and beatings
from their husbands, simply because they have no other place to live. 

Violence against children is also terrible. Two million cases of child
abuse are reported every year. At present, courts are facing some 257,000
cases that would deprive abusive parents of rights to their children. 



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