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Johnson's Russia List


April 9, 1999    
This Date's Issues: 3232 3233

Johnson's Russia List
9 April 1999

[Note from David Johnson;
1. Reuters: Russia steps up war of words with West.
2. AFP: Yeltsin Hints Primakov May Go.
3. AFP: Yabloko Faction Supports Chechnya Article Of Impeachment.
4. The Economist: The enmity at Russia's top. Boris v Yevgeny.
5. Business Week: Patricia Kranz, Kosovo's Wildest Wild Card: Moscow.
6. Itar-Tass: Governor Warns Russia May be next US Target.
7. Itar-Tass: Primakov: Agrarian Crisis No Longer Just economic.
8. Moscow Times: Leonid Bershidsky, MEDIA WATCH: Objectivity Alive, Not

9. Voice of Russia: Russian Orthodox Church: NATO Blaspheming Easter.
10. Moscow Times editorial: FSB Needs A Spanking From Yeltsin.
11. The Russia Journal: Yeltsin Vetoes Special Status for Russia's

12. Adrian Helleman: Easter truce.
13. Vlad Ivanenko: A moral meaning of Yugoslav conflict.
14. Gary Kern: Stalin wasn't modern.
15. Andrei Liakhov: CORPORATE GOVERNANCE.]


WRAPUP-Russia steps up war of words with West

BELGRADE, April 9 (Reuters) - Russia locked horns with the West over Kosovo 
on Friday, reportedly ordering its strategic missiles to be aimed at 
countries bombing Yugoslavia and warning that it would not allow NATO to 
launch a ground war. 

Parliamentary speaker Gennady Seleznyov also declared in Moscow that Russian 
troops would be stationed in Yugoslavia if a political union between 
Belgrade, Belarus and Russia went ahead and that ``our navy would be in the 
appropriate seas.'' 

The U.N. refugee agency appeared to have solved the mystery of the 10,000 
ethnic Albanian refugees from Kosovo who went missing on Wednesday night. The 
UNHCR said they had been located in Macedonia and neighbouring Albania. 

After a 16th straight night of NATO bombing raids on Yugoslav targets, an 
outbreak of fighting was reported on Friday between Serbian forces and Kosovo 
Liberation Army guerrillas on the Yugoslav-Albanian border. 

An Albanian government source said: ``An armed conflict started at 6 a.m. 
between the forces of the Kosovo Liberation Army and the Serbian miltary 
forces in front of the Padesh border post and later spread to the Kamenica 
area further south.'' 

Russia's Interfax news agency quoted parliamentary speaker Seleznyov as 
saying President Boris Yeltsin had ordered the country's strategic missiles 
to be aimed at those states bombing Yugoslavia. 

Russia's Strategic Rocket Forces said they were unaware of any order from 
Yeltsin to retarget missiles. There was no confirmation from the Kremlin. 

Seleznyov, a Communist who is speaker of the State Duma lower house, made his 
comments in an interview with Interfax. 

A Reuters correspondent listened to a tape recording of the Interfax 
interview. In it, Seleznyov was asked whether it was true Yeltsin had said at 
a meeting with the speaker he had ordered missiles targeted on those 
countries fighting Belgrade. Many of the 19 NATO member states have forces in 

``Yes,'' Seleznyov replied. ``In the direction of those countries which today 
are fighting Yugoslavia.'' 

The spokesman for the Strategic Rocket Forces noted that under a 
long-standing arrangement with the United States, Russia's missiles are not 
specifically targeted. Defence experts say it takes just seconds to target a 
missile, making any move of this kind largely symbolic. 

Seleznyov, who visited Belgrade this week, told reporters in the State Duma 
that a three-way union between Yugoslavia, Belarus and Russia would mean more 
than just military assistance for Yugoslavia in its fight with NATO. 

He said: ``I think that our army would be there too, that our navy would be 
in the appropriate seas.'' 

Milosevic has asked for Yugoslavia to be added to the union between Belarus 
and Russia. The union is built on a series of agreements over the past three 
years covering a wide range of areas, including defence. 

Yeltsin said earlier on Friday that Russia would not allow NATO to launch a 
ground operation in Kosovo and would not to be sucked into the Yugoslavia 
conflict unless Washington forced matters. 

In televised remarks, Yeltsin said: ``They (NATO) want to bring in ground 
troops, they are preparing for that, they want simply to seize Yugoslavia to 
make it their protectorate...we cannot let that happen to Yugoslavia.'' 

``I repeat again Russia will not get involved (in Yugoslavia) if the 
Americans do not push us,'' Yeltsin said. 

UNHCR spokeswoman Paula Ghedini told reporters at a refugee camp near the 
Macedonian capital Skopje that the refugees bussed away from a makeshift camp 
near the Blace border crossing with Yugoslavia had been located. 

Ghedini said the UNHCR was still looking for their exact location but 
believed they were in refugee camps in Macedonia and Albania. ``It's just a 
matter of finding them. There are 320,000 refugees in Albania; it's just a 
needle in a haystack,'' she said. 

In Washington, the Pentagon said intensified NATO raids had taken a rising 
toll on Serb targets this week and were ``seriously disrupting'' Belgrade's 
ability to supply its troops in Kosovo. 

The White House repeated that a ceasefire and other steps by Yugoslavia's 
President Slobodan Milosevic to end the bombing fell far short of demands 
that he stop purging ethnic Albanians from Kosovo and admit peacekeeping 
troops to Yugoslavia. 

Britain and the United States reiterated NATO had no plans to send troops 
into Kosovo as an invasion force. 

In an interview with BBC television, British Foreign Secretary Robin Cook 
said NATO was sending 8,000 ground troops to Albania to deal with the 
worsening refugee crisis in the Balkans. An invasion of Kosovo is ``not going 
to happen,'' he said. 

Belgrade's Studio B television station quoted the city's civil defence crisis 
centre as saying NATO aircraft ``hit the wider area of eastern Belgrade'' 
during Thursday night's attacks. 

The Belgrade-based news agency Beta reported that NATO warplanes had attacked 
a petrol depot in the southeast of the capital, and the sky over eastern 
Belgrade was red from the flames. 

Beta added that a number of strong explosions were heard in the Pancevo area 
of northern Belgrade. 

The official Tanjug news agency said NATO missiles hit a fuel depot in the 
southern town of Smederevo in the early hours of Orthodox Good Friday. ``The 
depot is in flames,'' it said. 

Tanjug also said a residential area of the central town of Kragujevac, site 
of the country's sole car-maker Zastava, was hit by at least seven missiles 
during the 16th night of NATO raids. 


Yeltsin Hints Primakov May Go 

MOSCOW, Apr. 09, 1999 -- (Agence France Presse) President Boris Yeltsin 
fanned speculation Friday that he is preparing to sack his prime minister, 
saying that Yevgeny Primakov is useful to Russia -- for now. 

"At this stage, Yevgeny Primakov is useful to us," Yeltsin said. "And later 
on, we will see." 

The Russian president's remarks clashed with a February vow that he would 
keep Primakov in office until his own presidential term expires in the summer 
of 2000. 

They also mark the first public confirmation of a developing row between the 
ailing Yeltsin and Russia's fast-rising premier who some speculate is gunning 
for the president's job. 

Moscow media has been swirling with reports from Kremlin sources suggesting 
that Yeltsin may soon replace Primakov with either ex-premier Victor 
Chernomyrdin or the liberal Anatoly Chubais, who heads Russia's electricity 
supply network. 

The Kremlin chief met Chernomyrdin on Thursday, the same day NTV television 
reported seeing Chubais' own car parked outside the president's office. 

Yeltsin is famous for keeping his subordinates off balance by hinting they 
may lose their posts at any time. 

The Russian president is furthermore facing an impeachment hearing in 
parliament next week. Analysts say that the president wants Primakov to use 
his authority with lawmakers to convince them not to proceed with the 

But Primakov's assignment is made more difficult because he relies on 
Russia's leftist opposition that is gunning for Yeltsin as his own basis of 

Yeltsin on Friday brushed aside speculation that Chernomyrdin, who served as 
premier until being abruptly sacked last year, was about to be offered his 
old post. 

"Victor Stepanovich (Chernomyrdin) told me that he wants to run for 
parliament," Yeltsin said.


Yabloko Faction Supports Chechnya Article Of Impeachment 

MOSCOW, Apr. 09, 1999 -- (Agence France Presse) President Boris Yeltsin's 
impeachment looked all the more probable Thursday when the sizeable Yabloko 
faction unanimously approved one of five criminal charges levied against him, 
Interfax reported. 

Yabloko politicians in parliament concurred that Russia's disastrous two-year 
war with the breakaway republic of Chechnya was sufficient grounds for the 
president's ouster. 

One of Russia's few prominent democratic parties, Yabloko holds a significant 
showing in the Duma, or lower house of parliament, where impeachment 
proceedings are set to begin next week. 

A lack of consensus from Yabloko on the debate could undermine the entire 
impeachment bid. Though calls have been made to postpone the trial due to the 
Kosovo crisis, Yeltsin himself urged deputies to press ahead with the 
hearings on April 15 as planned. 

In addition to the failed war with Chechnya, Yeltsin has been called 
responsible for the collapse of the Soviet Union, the ruin of its armed 
forces, the forced dissolution of parliament and the genocide of the Russian 

According to the Russian constitution, Yeltsin's second term as president 
comes to an end in the summer of 2000, after which time he has said he will 
not run again. 


The Economist
April 10, 1999
[for personal use only]
The enmity at Russia's top 
Boris v Yevgeny

WHEN President Boris Yeltsin first tried to dismiss Russias chief public
prosecutor for reasons of health last month, he should perhaps have
specified that it was his own political health he had in mind. The
prosecutor, Yuri Skuratov, was investigating high-level corruption and
capital flight, and his search was veering towards the Kremlin itself. He
kept his job because the Federation Council, the upper house of the Russian
parliament, exercised its right to block his dismissal. He has continued to
worry the sickly Mr Yeltsin, and others close to him, ever since. 

In the past few days, Mr Yeltsin has been having a second try at ridding
himself of Mr Skuratov. On April 2nd he declared Mr Skuratov suspended, on
the ground that the prosecutor was himself the subject of a criminal
investigation (apparently related to his appearance in a video leaked to
Russian television, which seemed to show him engaged with two naked women
in some distinctly non-legal manoeuvres). On April 5th Mr Skuratov offered
to resign if the Federation Council wanted him to do so. The Federation
Council was planning to debate his offer on April 21st. 

Mr Skuratov has upset Mr Yeltsin by poking away at the property-management
agency of the Kremlin, which is reputed to control billions of dollars of
cash and other assets. He has also been pursuing Boris Berezovsky, a
business tycoon and former intimate of Mr Yeltsins. Mr Berezovsky helped to
pay for Mr Yeltsins re-election campaign in 1996, befriended Mr Yeltsins
daughter and son-in-law, and had ready access to the Kremlin until the two
men fell out stormily in April last year. This week Mr Skuratovs deputy
issued a warrant for Mr Berezovskys arrestand was promptly demoted in his

The Communists, who control roughly a third of the Duma, the lower house of
parliament, have been egging Mr Skuratov on. They and other anti-liberal
opposition groups are still riding high after last years financial
collapse, which was blamed on Mr Yeltsins weakness for liberal economic
policies. Duma elections are due to be held at the end of this year. Of the
liberal voices, only Yabloko, a centrist block led by Grigory Yavlinsky,
seems sure of crossing the 5% threshold set for party representation. 

The Communists are way up at the top of the polls (see chart). On April
15th they plan to propose the impeachment of Mr Yeltsin in the Duma on the
grounds, first, that he helped to break up the Soviet Union and, second,
that he launched an illegal war in Chechnya. Even if the vote succeeded,
there would be more big constitutional hurdles to impeachment. But if the
process looked likely to grind on, some fear Mr Yeltsin might react by
trying either to ban the Communist Party or to sack the government.

The discreet hand of Yevgeny Primakov, Russias ex-KGB prime minister, may
be seen in Mr Skuratovs work. Not that Mr Primakov wants to bring down Mr
Yeltsin prematurely: on the contrary, he has everything to gain from the
status quo. It gives him time to plan his candidacy for the presidential
election due in May 2000; he is the favourite, but he lacks political
experience. Mr Primakov has, however, long wanted Mr Berezovsky, a wild
card in Russian politics, out of the way. And preserving the status quo
also means no capricious interventions from the presidentno sacking of the
prime minister or unnecessary quarrels with the Duma, both favourite
tactics of Mr Yeltsin in the past. In February Mr Yeltsin was rumoured to
be growing impatient with Mr Primakovs success, and to be planning a
replacement. Time, perhaps, to allow Mr Skuratov to send a warning to Mr
Yeltsin of his own vulnerability. 

Mr Primakovs plan seems to be that Mr Yeltsin should spend the coming year
in semi-retirement, his comfort and tranquillity guaranteed by his loyal
prime minister. The Duma (which is in Mr Primakovs pocket) will be
persuaded not to pursue impeachment. Mr Skuratovs troublesome
investigations can be discontinued. It seems an attractive offer, but it
could turn out to be a dangerous one for a prime minister to make to a
temperamental president. 


Business Week
April 19, 1999
[for personal use only]
Kosovo's Wildest Wild Card: Moscow
The crisis is dangerously straining U.S.-Russian ties
By Patricia Kranz in Moscow 

Russian Prime Minister Yevgeny M. Primakov made a sharp U-turn on Mar. 23 
when he heard NATO forces would soon strike Kosovo. On his way to Washington 
for a meeting with Vice- President Al Gore, Primakov ordered the pilots of 
his Russian jet to head immediately back to Moscow. Now, as the Kosovo 
conflict intensifies, relations between the U.S. and Russia could be headed 
for a sharp reversal as well.
Indeed, the crisis is dividing the U.S. and Russia like no other issue 
since the height of the cold war. And how the Kosovo war is resolved could 
have a huge impact both on domestic Russian politics and on the tenor of 
U.S.-Russian relations for years to come. The NATO strikes are fanning 
anti-American sentiment in Russia, giving a boost to President Boris N. 
Yeltsin's hard-line opponents, and undermining support for arms control. 
That's why, as a friend of Serbia, Primakov is scrambling to act as mediator 
in the conflict. If he can negotiate a cease-fire, he could be acclaimed for 
bringing peace and restoring Russia's prestige on the international stage. 
And he would become the leading contender to succeed Yeltsin as President in 
elections set for June 2000.
Every day the conflict continues, the pressure grows on Primakov and 
Yeltsin to intervene militarily. Indeed, on Apr. 7, the State Duma voted 
overwhelmingly in favor of a nonbinding resolution urging Yeltsin to send 
both arms and a military mission to Yugoslavia. Although Yeltsin is unlikely 
to heed that call, the move ups the ante sharply. If a ground war breaks out, 
Primakov may not be able to resist pressure to back the Serbs with arms or 
troops. ``This is the most dangerous crisis between Russia and the U.S. since 
the Cuban missile crisis,'' worries Alexei G. Arbatov, deputy chairman of the 
Duma's Defense Committee and member of the moderate Yabloko Party.
Any Russian military involvement in the conflict--except as 
peacekeeper--could be just the start of a sharp turn away from the West. 
Russian analysts say it would only be a matter of time before the country 
began rebuilding its nuclear arsenal and forging tighter strategic ties with 
China, Iran, and Iraq. Already, the conflict has put on hold U.S.-Russian 
efforts to slash nuclear arsenals. After years of delay, Primakov had 
persuaded the Duma to vote on and approve the START II treaty in late March. 
The vote was cancelled after the strikes, and the treaty is all but dead.
A further escalation of the Kosovo conflict will also shake up Russian 
domestic politics. According to recent Russian polls, 98% of the population 
opposes the NATO strikes. The conflict is almost sure to boost support for 
Communist and nationalist politicians in parliamentary elections in December.
NEXT PRESIDENT? As a shrewd diplomat and ex-spymaster, Primakov seems to be 
maneuvering through this minefield to come up with the best outcome for 
Russia--and perhaps his own political career. At home, he is loudly 
condemning the NATO air strikes, though resisting military intervention. 
Apart from Kosovo, he is winning favor by going after Russia's once-powerful 
banking tycoons, issuing arrest warrants for businessmen Boris Berezovsky and 
Alexander Smolensky for alleged financial crimes.
Most important, in the international arena, Primakov is presenting himself 
as the only person who can broker a deal between NATO and Yugoslav President 
Slobodan Milosevich. It's true that the Serbs trust Primakov because Russia 
consistently has opposed the use of force in Yugoslavia. And the Clinton 
Administration is also used to dealing with the ex-Foreign Minister. On Apr. 
6, Vice-President Gore asked Primakov to urge Milosevich to accept NATO's 
terms to end the conflict. Although Primakov hasn't yet revealed his own 
proposals, Russian analysts say he could push for a deal that would include a 
peacekeeping force involving Russian troops and soldiers from NATO countries 
uninvolved in the bombing, such as Spain.
As the bombs continue to fall on Kosovo, in Russia all eyes are on 
Primakov. When he became Prime Minister last September, the 68-year-old was 
seen as a transitional figure: the ailing Yeltsin's right hand man until next 
year's Presidential elections. Now, he is playing a far greater role.


Governor Warns Russia May be next US Target.

MOSCOW, April 9 (Itar-Tass) - Communist governor of the Russian Siberian 
region of Kemerovo Aman Tuleyev warned on Thursday that Russia may become the 
next target of the United States and called to change the negative attitude 
to the national armed forces. 

"The war in Yugoslavia should unite us. We have to change our attitude to the 
army and think that if the United States changes its adversaries each time - 
now it is Iraq and then Yugoslavia - then we can be the next", he told the 
"Mayak" radio station. 

"We have to think about our security", Tuleyev said stressing that the issue 
of impeaching the presidnet, planned by the State Duma, should be dropped in 
the present situation. 

"I am against the impeachment although I do not have excellent relations with 
the president", Tuleyev said. 


Primakov: Agrarian Crisis No Longer Just economic 

MOSCOW, April 7 (Itar-Tass)--Russian Prime 
Minister Yevgeniy Primakov declared on Wednesday that "reduction in 
imports of farm produce is not counterposed to the question of support 
for the domestic farmers. The imports of farm produce will continue but 
it will be balanced in a way that would help domestic manufacturers." 

He declared that this policy will have to be pursued amid "a very tense 
situation emerging in the countryside. The measures taken by the 
government earlier are clearly insufficient; this question is already 
becoming not only economic but also political in character." 

The Russian prime minister, who was speaking at a conference on the 
agro-industrial complex in Moscow on Wednesday, stressed that "unless the 
countryside revives, no government will be able to stabilise the 
situation in the country." 

He noted that his Cabinet of Ministers "will consistently pursue a 
policy of protecting the domestic agricultural manufacturers." For this 
purpose, the government will take steps to ensure financial stabilisation 
of the agro-industrial complex, regulate conditions for the customs 
policy and take steps to restore the parity of prices between the farm 
and industrial products. 

Primakov who said, "we have reached the climax ahead of the sewing campaign," 
announced that the government priorities in the sphere of the 
agro-industrial complex would be intensification of production, state 
regulation, the development of integration and cooperation. 

"It is necessary to shift the centre of gravity to the investment 
activity in the countryside," the prime minister said. He issued 
instructions to the Ministry of Fuel and Energy to complete the 
deliveries of fuel and lubricants to the farms for April before April 10. 

The Ministry of Agriculture was told to solve all problems relating to 
the provision of fertilizers and insecticides within a week, and the 
delivery of seeds to the regions before April 15. 

Primakov also ordered the Ministry of Finance to provide funds to farmers for 
the purchase of fuel and lubricants, chemicals and seeds, as well as to 
issue loans to cover the seasonal expenses. 

Primakov appealed to the leaders of the Unified Energy Systems of Russia and 
the Gazprom natural gas supplier, Anatoliy Chubays and Rem Vyakhirev to 
show understanding of the need for energy resources in the countryside 
and provide such resources at a discount. 


Moscow Times
April 9, 1999 
MEDIA WATCH: Objectivity Alive, Not Well 
By Leonid Bershidsky
Staff Writer

It is the new conventional wisdom that the Russian media coverage of the 
crisis in Yugoslavia is getting more balanced. There was, for example, the 
brilliant Itogi current-affairs program on NTV last Sunday, which gave equal 
treatment to both sides in the conflict as well as in the Russian political 
debate on Yugoslavia. 

One cannot find fault with NTV for its recent coverage of Yugoslavia. I do 
not even think it would be fair to ask the usual question that never fails to 
come up in discussions of Russian media: "Who is behind the sudden 
objectivity?" NTV is just doing what it knows how to do - it is covering a 
war with gusto and Chechnya-tested professionalism. 

But anti-Western hysteria still rages in some Russian news organizations. The 
way Itar-Tass, the official, government-controlled news agency, has rallied 
to the defense of our Serb brothers is particularly telling. 

Itar-Tass has tried in recent years to be a real news agency and just report 
events in a more or less impersonal style. But the agency, which has kept on 
many of its Soviet-era propaganda stars, can turn on a dime when it comes to 
reverting to the 1970s style of writing about the West. 

If Itar-Tass was the only source of information on the conflict, one could 
think the Soviet Union is back and the year is 1979, not 1999. No one who is 
interested in the workings of the Brezhnev-era Soviet press should miss the 
Tass coverage of Yugoslavia. 

The purple prose that was Tass's stock-in-trade back in the '70s is back now 
with a vengeance. "On the Brancov bridge across the Sava, people keep singing 
along with pop performers, defending this 'artery of life' with their bodies. 
That's the kind of people they are," Tass journalists Tamara Zamyatina and 
Nikolai Kalintsev write. 

There is no need for Yugoslav censors even to read through this copy. They 
could not write it better themselves. 

The same two journalists recently covered a friendly soccer game between the 
Greek club AEK Athens and the local side Partisan in Belgrade. "The game 
began with a moment of silence in memory of the people killed in the two 
weeks of barbaric bombings, and the match itself lasted for just 56 minutes. 
After that, fans rushed onto the field and heaped flowers on the players. 
This must have been the only such case [in history] in which the home side 
was not punished for disrupting the game." 

Itar-Tass's coverage would not have been complete without reporting from the 
wolf's den, meaning places like New York and Ottawa. What needs to be covered 
in those places is, of course, the "progressive public's" protests against 
the Western governments' aggressive policies. 

"A mass rally against U.S. participation in the military action in Yugoslavia 
and against the distorted coverage of these events by American media was held 
in New York on Wednesday," reports Tass correspondent Alexei Berezhkov. He 
omits to mention the number of demonstrators, and though he says the rally 
was organized by a certain "International Action Center," the group is not 
described in the dispatch. 

And from Ottawa, Tass correspondent Nikolai Setunsky reports that 11 Russian 
officers who were supposed to undergo training in Canada had left the 
country. "And, as local military sources imparted to the Itar-Tass 
correspondent on Wednesday, that is not the only negative consequence of 
Canada's role in the undeclared war against Yugoslavia for the 
Russian-Canadian military contacts that have been developing successfully in 
recent years." 

The phrase "undeclared war," used in the two previous decades to describe 
just about any U.S. military action, has returned, too. If the bombings go on 
much longer, we will be reading about "ferocious capitalist exploitation" and 
soaring unemployment in the West. 

You can expect no less from a news agency where Prime Minister Yevgeny 
Primakov recently installed his intelligence service buddy, Yury Kobaladze, 
as deputy director general. But then in the previous era Itar-Tass was always 
full of spies working under journalistic cover. 

Tass is still one of the world's biggest news agencies in terms of staff 
numbers and reach. With its huge network of bureaus, Tass could be a major 
force in world journalism if it wanted to. But it keeps hanging on to its 
past, and instead of trying to beat Reuters on major stories, it puts itself 
on a par with the "news agencies" run by regimes like Milosevic's, Kim Jong 
Il's and Saddam Hussein's. 


Russian Orthodox Church: NATO Blaspheming Easter 

Voice of Russia World Service
6 April 1999

[Presenter] In a few days' time the entire Orthodox 
world will be celebrating Easter, the shining holiday which marks the 
resurrection of Christ. NATO, led by the USA, has already marked one 
Easter Day, the Catholic one, by carrying out air strikes. Will they 
raise their hand against the Orthodox Easter? The world is waiting to see 
what happens. Nikolay Kyuev [phonetic] comments on this topic. 
[Commentator] All Orthodox Christians throughout the world will soon be 
congratulating each other on the glad tidings that "Christ has risen". 
But, unfortunately, this year the joyful news will be tinged with 
sadness. There is one reason for this sadness, Yugoslavia. President 
Clinton of the USA has already spoilt one Easter, for all the Catholics - 
and this in spite of an appeal by the pope himself, the leader of all 
Catholics. The president ignored all the Christian commandments, on the 
very day when even enemies embrace and forgive each other. This is called 
blasphemy. And this is being done by a man who swore on the Bible when he 
took up office. Furthermore, the banknotes of the country which he rules 
bear the words "We trust in God". This is truly blasphemous. 
But what will happen on the Orthodox Easter? What can the poor Orthodox 
Serbs expect? These are difficult questions. One would very much like to 
hope that the forces which are mocking Christian values will heed some of 
the reflections of His Holiness, the Patriarch of Moscow and All-Russia, 
Aleksiy II. They may pause to consider whether they should bomb Belgrade 
on Easter Day or not. 
[Voice of patriarch, recorded] Easter lies ahead. Please refrain from - 
[changes thought] for Catholics this is the greatest day of the year. But 
on this day they are bombing and destroying, and not only military 
targets now. They are now destroying vital infrastructure which keeps 
life going, including thermal and other power stations, bridges and a 
water pipeline. People are being deprived of their jobs. This could soon 
lead to an ecological disaster in Yugoslavia. His Holiness Pope [John] 
Paul and I, the Vatican and everybody else have been appealing for an end 
[to air strikes] over the Easter period. This was a good opportunity for 
them. Somehow they have to escape from this situation. But no, they did 
not take advantage of it. Clinton assures us that he is a Christian. But 
is this Christian behaviour? 
[unidentified interviewer] The Orthodox Easter lies ahead. 
[Patriarch] The Orthodox Easter lies ahead. So, if they carry on bombing over 
the Orthodox Easter, what kind of Christians are they? They are not 
Christians, they are barbarians. 


Moscow Times
April 9, 1999 
EDITORIAL: FSB Needs A Spanking From Yeltsin 

Interpreting the rights of parliament under the Russian Constitution would 
seem to be a job for someone other than the KGB successor agency. 

But the Federal Security Service thinks otherwise - not surprising given its 
KGB roots. The KGB was never shy about asserting itsauthority in any sphere 
of Russian life. 

This week the FSB sent a letter to Prime Minister Yevgeny Primakov, 
Federation Council head Yegor Stroyev and Duma Speaker Gennady Seleznyov, in 
which the chekisti offered their entirely unsolicited opinion that the 
impeachment drive underway against President Boris Yeltsin isn't legal. 

The FSB announced it had studied the five articles of impeachment, which the 
Duma is to take up next week, and uncovered "significant mistakes of a legal 

Who asked them? No one. 

The Moscow Times is tempted to send the FSB a similarly cheeky letter 
announcing that we have studied its case against environmentalist Alexander 
Nikitin and found it significantly shoddy. A formal legal opinion from our 
newspaper on this topic would be about as appropriate as the FSB's opinion 
about impeachment. 

Then again, we don't have tanks and guns, or homemade porn movies of the 
nation's leaders, or an in-house murder-for-hire bureau, so perhaps we'd be 
too easily ignored. 

The FSB's letter to the Duma is a threat. Time will tell whether it is more 
bark than bite. But either way, it's not a particularly flattering commentary 
on Russian democracy that the security services feel free to bully the 

Is it any wonder that rumors are creeping down the halls of the Duma, and 
across the pages of the national media, that the Kremlin is preparing to 
impose a state of emergency? 

The situation is dicey enough - there is tension between Yeltsin and 
Primakov; the Central Bank's reserves are dwindling as the ruble hems and the 
IMF haws; the Interior Ministry is talking about a coming wave of Chechen 
terrorism in the wake of the horrible bomb at the Vladikavkaz market; the 
FSB's offices themselves were hit by a bomb this week; the U.S. Embassy has 
been the scene of everything from egg-throwing to machine-gun play; and NATO 
is waging war in Europe against Russia's Serbian allies. 

And into this mess wanders the FSB, with marching orders for parliament. 

This is outrageous, and Yeltsin shouldstep forward and say so. 

When it comes to Yugoslavia, President Yeltsin deserves praise and admiration 
for keeping one of the only cool heads in Russia. While others bay for NATO's 
blood, Yeltsin insists Russia's role in the Balkans is one of diplomacy, not 
force. It's time he offered similar reassurances at home. 


The Russia Journal
April 5-11, 1999
Yeltsin Vetoes Special Status for Russia's Scientific Cities 
The Duma and Federation Council are Determined to Override the Ruling 

Recent events in the Balkans have eclipsed other news, including the
scandal over sanctions imposed by the United States on several Russian
universities and defense enterprises suspected of exporting nuclear
technologies to Iran. Russia has categorically denied these accusations,
though a number of politicians noted that technology leaks could not be
ruled out. Technological secrets are stored not only in the databases of
secret institutes and design bureaux but also in the brains of individuals,
many of whom are finding themselves in dire straits today. The combined
payroll of Russia's "scientific cities" has been cut in half over many
years of reform. 

In addition to Moscow, St. Petersburg and Novosibirsk, Russia's scientific
potential has been concentrated mainly in the so-called "scientific cities"
- Obninsk, Zhukovskii, Troitsk, Obolensk, Protvino, Zelenograd, Lytkarino,
Mendeleevo, Dmitrovgrad, Koltsovo and others - a total of some 60 cities.
Some of these like Zheleznogorsk (Krasnoyarsk-26), Zelenogorsk
(Kranoyarsk-45), Sarov (Arzamas-16) and Snezhinsk (Chelyabinsk-70) are
restricted areas. With a combined population of more than 2 million, these
cities are experiencing tough times and may become ghost towns unless
granted a special status and government assistance. 

Brain drain from Russia's scientific centers has been a well-known problem
for years. Some researchers leave for money while others seek a place where
their talents may be appreciated and developed. These people leave Russia
carrying important technologies, the results of laboratory tests still in
their memory. 

The draft law "On the Status of Russia's Scientific Cities" was expected to
change the situation. Both houses of parliament, the State Duma and the
Federation Council, almost unanimously passed the law, but President Boris
Yeltsin vetoed it on the grounds that it contradicts the law "On Local
Government." Anatolii Dolgolaptev, president of the Russian Association to
Develop Scientific Cities, called the argument a pretext. 

The term "scientific city" appeared in 1991, although most of these cities
were founded between the 1930s and 1970s. Strict secrecy was meant to
guarantee the Soviet Union's leadership in the world in science and
technology - specifically science and technology related to defense.
Inhabitants of these cities sincerely believed they had an "important
mission" and were of great significance to the country. Many of them have
come to view themselves as Russia's "chosen ones." 

Aware of the difficult situation, the Russian government promised
assistance to these cities and proposed a program to make them economically
self-sufficient. Obninsk was chosen as a test case. The city administration
drew up a plan for spending 646 million rubles and estimated 1.01 billion
rubles in returns. All seemed to be going fine, but after a year, it became
clear that the plan could not be implemented without assistance from the

Reform proposals are not always welcome. Dubna Mayor Valerii Prokh warns
that the whole idea of making scientific cities economically
self-sufficient is dangerous. He contends that priceless technology and
equipment will be destroyed if facilities be converted to produce consumer
goods. But this view does not take into account the long-term economic
benefit to the cities and to entire country. Russia's scientific cities
could be developed into world centers of science and technology. Obninsk,
Zarechnii, Zelenograd, Jubileinii and several others are starting to focus
on developing pioneering technologies as a source of income. 

The city administrations are convinced that Yeltsin vetoed the draft law
because the government simply cannot afford to pay for its implementation.
"In fact, the law does not provide for any financial benefits to these
cities," Krasnoarmeisk Mayor Valerii Kovshov argues. "It only provides for
more opportunities to work and earn money. Besides, our scientists need
some moral support and recognition of their role in the country's progress.
After all, is it fair that a street vendor is better off than an

"We will earn enough money with the help of our brains. All we need is for
no obstacles to be placed in our way," says Mayor of Fryazino Vladimir
Savchenko. "Our enterprises have belonged to five ministries since 1991:
the Radioelectronic Industry, Industry, State Committee on Defense, Defense
Industry and, finally, Economics ministries. As a result, nobody really
cares about them." 

Leaving Russia's scientific cities to the mercy of fate involves one more
danger. Most of them are sites of hazardous facilities and materials from
experiments in nuclear physics, microbiology, virology, biotechnology, etc.
The present situation in the "scientific cities" can only be characterized
as a sweeping crisis. Budget financing of scientific research has been cut
90 percent since 1990. This year, 11.5 billion rubles from the budget were
earmarked for research science, but nobody knows what the actual allotment
will be. The 1998 budget envisioned research science spending at 11.2
billion rubles, while only 5 billion rubles were actually provided. Not a
single research program received the promised funding. 

Duma deputies have stressed that the problems of scientific cities are also
Russia's problems. The question is not only of saving the country's
scientific elite, but of preserving its centers of growth. Almost
unanimously, the State Duma has once again passed the draft law without
changing its text. Now, the fate of the document is in the hands of the
Federation Council, which is expected to meet in early April. 


Date: Thu, 8 Apr 1999 
From: Adrian Helleman <> 
Subject: Easter truce

I have refrained from commenting publicly earlier on the bombing in
Yugoslavia. But now I would appreciate it if you would permit me to use
JRL to submit the following open letter. Thank you for the opportunity. I
can think of no other way to make this proposal on time.


Sunday, April 11, is the date when many Orthodox Christians, especially
those who are living in Eastern Europe. this year will celebrate Easter.
It would be highly appropriate for you, as the leaders of NATO, to consider
proposing a truce, effective at dusk (in Yugoslavia) on April 10, which
marks the beginning of Easter for the Orthodox.

The cease-fire proposed by Mr. Slobodan Milosevic may have been a
diplomatic ploy, but a careful consideration of it would been the most
appropriate response. It is still not to late to take further action,
however. I suggest that you unilaterally declare a cease-fire for Easter,
and that you declare this to be your further response to his proposal.

Last Sunday, which marked the Western Easter, might have been an
appropriate occassion for a truce. But this coming Sunday is even more
fitting, since so many Serbs are Orthodox believers. It would be wonderful
for them to be able to attend the midnight services, without worrying about
bombs. This generous gesture would go a long way to healing the wounds
that the bombings have opened up throughout Eastern Europe, and especially
in Russia. 

The truce should be followed up by negotiations to find a diplomatic
solution to the problem of Kosovo. Russia should be enlisted to assist in
these negotiations. Eventually a peace-keeping force will be required
there And if I may make another suggestion, Russian troops should be
invited to participate and, perhaps, constitute as much as 50% of such a
force. But before any of this can happen, a truce is required. Only you
can make that possible.

In the name of the risen Christ, I appeal to you as leaders to declare this
truce. It would be the best gift that you can give to the world during
this Easter season.

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


Date: Wed, 7 Apr (Unverified)
From: Vlad Ivanenko <> 
Subject: A moral meaning of Yugoslav conflict

Reading the postings on the list I feel the idea is in the air that, after
all, there is a morally acceptable meaning of the Yugoslav conflict. The
message is simple: It is not the war but it is a lesson to future
dictators that their maltreatment of citizens will not be tolerated by the
world community. I guess it all began with quite different ideas in the
minds of policy-makers but an attempt to make good out of bad is to be

The lesson, in order to be learned, should follow the logic of teaching
and not that of war. If the conflict is the lesson, prospective
"students", first of all Russians, needs to get assured by the "teachers"
that the guilt is personal and not joint and, hence, the Yugoslavs are not
bombed into servitude, that innocent victims from all sides are to be
compensated, that the use of force is justified only if it is legitimized
by an authoritative body. If it is the war, all stated above is
irrelevant, for we expect death and destruction to follow the war normally
and without explanation (apart from regular propaganda for domestic

If the argument of the lesson is accepted, the NATO needs to state that it
is going to reconstruct Yugoslav civil infrastructure damaged during the
conflict by its troops, to compensate civil victims (Alecsinac provides an
example), and to find a way explaining why it did not legitimize its
action beforehand. The last point may become relevant requesting a
restructure of the UN Security Council. At the same time Russia needs to
agree that Milosevic and his group deserves an independent trial after the
conflict is settled. 

Vlad Ivanenko, Ph.D. candidate in economics
University of Western Ontario


Date: Wed, 7 Apr 1999 
From: Gary Kern <gkern@alumni.Princeton.EDU> 
Subject: Stalin wasnt' modern

Bill Mandel's contribution to the Stephen Cohen-Martin Malia debate in
#3115 contains certain premises that I would like to contest.

1. "Marxist socialism, which modernized and educated Russia and vastly
extended life expectancy, failed because its elimination of the market
ultimately caused it to choke on its own bureaucracy."

Marxist socialism--i.e., Stalinism--did not modernize anything. It
produced hydroelectric dams, buildings, tanks etc. with a system that
could be justly called Soviet primitivism. The factories were not
modern, the quotas were not modern, the Stakhanovite movement was not
modern, the Gulag was not modern, the slave labor was not modern, the
incentives and living standards of workers were not modern, the mining
of resources was not modern, the distribution of goods wasn't modern...
and so on.

It did not exactly educate Russia either: it destroyed agronomy,
biology, philosophy and every other branch of free exchange and inquiry.
Did it extend life expectancy? For whom? Those not arrested or those
imaginary beings on the falsified census rolls? When can we begin to
look at the problem holistically? Whatever the Soviet system produced,
whether wedding-cake building, Olympian athlete or marching parade, or
the street on which they were photographed, was taken out of the sweat
and blood of the people. It collapsed from human exhaustion.

2. "The people [today] are fed by Stalin's 1930s concession to the
peasants: private plots, then extended to the urban population as well."

Are we supposed to read this "concession" (which I thought was
Khrushchev's, but no matter) as a good thing? That is, that after
driving millions of peasants into collective farms and starving millions
of those farmers to death by grain requisitions, Stalin conceded private
plots to the people, and by this act of benevolence receives the credit
for feeding post-Stalinist Russia? And are we supposed to consider a
twentieth-century country that produces more edibles on its garden plots
than on its farms (as it did for years before the collapse) a nation
that has been modernized by scientific socialism?

3. "Lenin's New Economic Policy read the mind of the Russian people
better than anything since. Whether it could have adequately 
industrialized Russia for successful defense in whatever a second world
war would have been in the ensuing international political circumstances
is an unanswerable question."

Lenin's New Economic Policy didn't read anybody's mind but Lenin's. War
Communism was an economic disaster, so Lenin made a temporary concession
to private enterprise. Does the statement mean that after Kronstadt he
made a New Deal with the people? Who consulted the people? However, it
is true, Lenin did die in a way, and Stalin replaced NEP with the Five
Year Plans, so we can't tell what would have happened. But the
five-year plans were the very programs of "Marxist socialism" that
supposedly modernized Russia, so Mr. Mandel has his doubts about Lenin.
You can't have your pyatiletka and NEP it too.

So then, can we not at last agree that Stalin wasn't modern? That he did
nothing good for Russia? Is further proof really needed that every
social and economic program was dark, primitive, wasteful, murderous? 
And that Khrushchev and Brezhnev's innovations, whether negative or
positive, did not change the system? Martin Malia is right: the
Bolshevik experience was a disaster. But Stephen Cohen is right too: 
shock therapy was a disaster. America's Russian policy is a disaster.

Just as Sputnik gave the impetus to nationwide programs in Russian
studies, so the miserable mismanagement of Russian affairs in the
Yeltsin era should prompt a re-examination and overhaul of American
foreign policy. As Russia watchers, we have an excuse for having been
wrong about so many things: it wasn't our full-time job. The so-called
experts don't have that excuse.


From: "Liakhov, Andrei" <>
Date: Wed, 7 Apr 1999 

I do not question Mr. Backer's integrity or professionalism, however his
reply on corporate governance raised a couple of points I'd like to clarify:

Firstly I'd like to correct what seems to be a minor mistake in Paul
Backer's piece on the above - NAUFOR is the Russian abberiviation of Ntional
Association of Professional Participants of Securities Markets and has
nothing to do with Russian equivalent of USAID. 

Secondly - the Russian law notoriously lacks any effective mechanisms to
protect minority shareholders' rights and unless you hold 25%+1 share
(ordinary voting shares of course and not preference) you basically have no
real say in corporate affairs of the issuer of such securities. 

This opinion is based on the law as is currently in force and my practice
for the last couple of years.

For example:

a. the Charter of a company (which is the Russian equivalent of Articles of
Association) may impose restrictions on "the maximum number of votes cast by
any one shareholder" (Clause 11.3 of the 1996 Joint Stock Company's Law

b. In order to approve amendments to the Charter the JSCL requires approval
of 3/4 of the votes participating in a General Shareholders Meeting ("GSM")
(Clause 12.2) and only fully paid up shares may participate in a GSM. 

c. Although it's true that holders of 2% or more of the voting shares of the
Company may "submit not more than two proposals for the agenda of the
annual general meeting of the shareholders and to nominate candidates for
the board of directors (or supervisory board) of a Company and the
audit commission (or auditor) of a Company, the number of which may not
exceed the quantitative composition of such body." (Clause 53.1), but that
does not mean that these proposals will be included in the agenda as it is
put together by the Board of Directors which may reject such proposals. As
the GSM is limited to consider only such issues which are listed in the
agenda for the GSM I think it is abundantly clear that chances for a
minority shareholder to be heard are in practice dismal. 

The above list of examples is not exhastive by far and in open joint stock
companies (equivalent of an English plc) protection opportunities for
minority shareholders (particularily from dilution of their holdings) are
even more limited

Furthermore any agreements in respect of corporate governance (commonly
known as "shareholder agreements") do not form a part of constituent
documents and will be invalid if they aim to restrict any rights conferred
on shareholders by Law. 

Even if you managed to acquire 25%+1 share (and it really should be 26%) you
only have a real power to veto the most important decisions (i.e. exercise
negative control) such as liquidation, re-organisation of the company,
increase in the share capital, etc.

Thirdly, - the book which is referred to by Paul Backer (and a copy of
which is on my bookshelf) is a very good guide for people who want to learn
about how things should be done in the ideal world, but as all JRL readers
know Russia is very far from the ideal world. 

Unfortunately the law currently in force does not provide any real grounds
for optimism in the area of corporate governance. In the course of one of
the EBRD projects I advised on we had to advise on the best shareholder
protection mechanism for EBRD investment. Having done a very extensive
analysis of all options available we have come to the conclusion that the
only real way how to protect your investment is to acquire 26% (or 25%+1
share) of the share capital. 

Even EBRD which has a lot of clout may experience difficulties with its
investments in Russia (particularily when investing into a small and medium
companies which do not have proper management experience) when it comes to
corporate governance issues. Minority shareholders in Russia who do not
posses EBRD-like reputation and influence may only rely on good will and
honesty of the company's management and other shareholders. Having said that
I have to note that in some cases minority foreign shareholders in Russian
companies are trying to exercise various kinds of pressure on the company
and other shareholders in situations which, have such occured in a
"civilised" country, would be considered a normal boardroom battle.

I hope that the above will be helpful to all who wants to invest or is
interested in the current Russian legal environment - for more information
please do not hesitate to contact me on - I'm also
very interested to hear about other people's experience in these issues. 



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