May 21, 1999    
This Date's Issues: 3297 • 3298 • 

Johnson's Russia List
#3298
21 May 1999
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Russian liberal Gaidar sees cabinet in safe hands.
2. Reuters: Russian capital flight overestimated - ex-c.banker.
3. Itar-Tass: IMF Executives Sees Inspiring Signs in Russian Developments.
4. Itar-Tass: 75,000 Russian Public Associations May Cease to Exist by July.
5. Itar-Tass: Stepashin Describes Policy in Nezavisimaya Gazeta.
6. Jamestown Foundation Monitor: BEREZOVSKY: HE'S BACK and CHUBAIS
APPEARS TO BE THE MAIN LOSER IN CABINET BATTLES. 
7. Washington Times: Ariel Cohen, U.S.-Russian Ties: A Window of
Opportunity?
8. Interfax: Academician Says Stepashin Not To Stay Long. (Sergei Markov).
9. Russian Regional Report: NOVGOROD COMMUNISTS CONCERNED ABOUT STEPASHIN and KAZAN SORRY TO SEE PRIMAKOV GO, BACKS STEPASHIN. 
10. Ed Spannaus: RE: RFE/RL REPORT ON BILLINGTON AND HARTMAN.
11. Itar-Tass: New Russian State Duma to Be More Left Gennady Seleznyov.
12. STRATFOR's Global Intelligence Update: CIS/Baku Alleges Moscow Brokered 
Chinese Missile Sale to Armenia.
13. Interfax Analyst on Luzhkov as Rival to Yeltsin.
14. Moscow Times: Natalya Shulyakovskaya, LIVE FROM MOSCOW: Duma
Elections a Bit of a Gamble.
15. Vladivostok News: Russell Working, Communist Sells Icons But Worships 
Soviets.
16. Washington Post letter: Worse Than the Serbs. (Ethnic cleansing after
World War II).]

********

#1
Russian liberal Gaidar sees cabinet in safe hands
By Peter Henderson

MOSCOW, May 21 (Reuters) - Russian market reformer Yegor Gaidar gave good 
marks to the unknown railways minister summoned to run the economy but said 
the new government now being formed was already something of a lame duck. 

Gaidar, an economist who launched market reforms as acting prime minister in 
the early 1990s, told a meeting of his political party late on Thursday not 
to expect much from the new government headed by Prime Minister Sergei 
Stepashin. 

"To expect reforms from this cabinet is hopeless. But it is reasonable to 
expect the cabinet not to make many idiotic moves, to stop parties from 
putting too much money in their pockets...to do normal, calm and quality 
work," he said. 

"The Stepashin government will be in some ways a caretaker government," he 
told investors later in the evening at a conference call organised by 
Brunswick Warburg investment house. 

"There is no hope this government will be in a position to push through 
legislation...anything serious." 

Stepashin was confirmed as prime minister on Wednesday and is going about 
forming his government. He takes office in a politically sensitive period 
ahead of a December parliamentary election and a presidential poll next 
summer. 

The one certainty in Stepashin's cabinet appears to be the man appointed 
minutes before his predecessor was fired -- Nikolai Aksyonenko, who rose 
through the ranks of the state railway system to become minister. 

For just over a week, he has been acting first deputy premier for the 
economy. 

Gaidar said the railways minister had done a good job in his sector. 

"He built up the railways very well in terms of control of financial flows, 
discipline and so on," Gaidar told the meeting of his party, Russia's 
Democratic Choice. 

"The problem is that those measures and those managers who are very qualified 
in a centralised system...are absolutely unacceptable, are life-threatening 
for running a market economy as a whole. We'll see how capable he is of 
understanding that." 

Gaidar said he expected the State Duma lower house of parliament to pass some 
laws agreed in principle by the previous government with the International 
Monetary Fund as part of a $4.5 billion 18-month credit plan. 

Other measures could be taken by the government to win formal IMF approval of 
the plan before the elections, he said. 

Gaidar saw Russia's political future improving for free-marketeers as 
Communist support stagnated, leaving parliamentary seats for the centre, 
especially a possible alliance of Moscow Mayor Yuri Luzhkov's Fatherland 
group and liberal bloc Yabloko. 

President Boris Yeltsin's shock sacking of the government days before 
impeachment hearings was a success story, he said. 

He would not guess how much businessmen known as oligarchs would be able to 
influence formation of the new government but said Yeltsin had acted in 
typical form by taking on the Duma. 

"I think it was all Yeltsin," he said. "It is exactly his type of situation: 
direct confrontation." 

*******

#2
Russian capital flight overestimated - ex-c.banker

MOSCOW, May 21 (Reuters) - Russia's capital flight, officially put at $15 to 
$20 billion annually has been overestimated, an independent expert and former 
senior central bank official said on Friday. 

"The scale of capital flight is grossly overestimated," Sergei Aleksashenko, 
who heads the Centre for Development think tank, told a news conference. 

Aleksashenko, who was first deputy central bank chairman before the August 
economic crisis, put the volume of capital flight at about $5 billion a year. 

He said the $15-$20 billion figure reflected the low standards of Russian 
statistics, which calculate capital flight by estimating hard currency 
earnings which exporters fail to repatriate and the volume of dollar 
purchases by households. 

Aleksashenko said some of the unrepatriated hard currency earnings 
represented supplies of oil and gas to the Commonwealth of Independent States 
countries. 

These countries often fail to pay for the exports, or pay after the 180 days 
which the central bank allows for revenue repatriation, making the 
authorities believe that late or barter payments represented capital flight, 
he said. 

He also said that while the central bank received exact figures for the 
volume of dollar purchases by households, it could not see how much of the 
money was exported. 

*******

#3
IMF Executives Sees Inspiring Signs in Russian Developments.

WASHINGTON, May 21 (Itar-Tass) - IMF First Deputy Managing Director Stanley 
Fischer sees inspiring signs in the Russian developments judging by his 
interview with the Reuters news agency in Washington. 

Russia and the International Monetary Fund have a coordinated plan of action 
which new Premier Sergei Stepashin promises to submit to the State Duma, 
Fischer said. So far, the new prime minister has been dealing with the Duma 
much better than expected. 

Fischer has not spoken to Sergei Stepashin but he has pledged the development 
of contacts with Moscow. The International Monetary Fund will continue to 
keep contact, and the program will remain in the center of attention, he 
said. 

The tax collection in Russia was not bad in the first two months of this 
year, Fischer noted. The overall percentage of collected taxes as against the 
gross domestic product is rather large, but the share taken by the federal 
authorities is much smaller than it should be, he said. 

Fischer does not fear that Russia will announce default on its debts to the 
IMF. He thinks it is a country ready for extraordinary efforts to regularly 
service its debts. It is a country which wants to remain a member of the 
international community and not to be an outcast, the executive remarked. 

Last month the International Monetary Fund and Russia agreed to resume the 
cooperation, and the IMF promised to bring 4.5 billion dollars worth of 
additional credits in the next 18 months. Russia took an obligation to make 
several steps which would enable the program's approval by the IMF Board. 
That agreement is still valid, but the IMF cannot continue giving the money 
if the situation with the tax reform does not improve, Fischer said. In his 
opinion, Moscow can either better collect budget revenues or cut the 
spending. 

*******

#4
75,000 Russian Public Associations May Cease to Exist by July.

MOSCOW, May 21 (Itar-Tass) - Up to 75,000 public organizations of Russia may 
be liquidated on July 1, Justice Minister Pavel Krasheninnikov said in an 
interview with the Nezavisimaya Gazeta newspaper on Friday. The public 
organizations which do not re- register themselves by that time will cease to 
exist as juridical persons, he added. 

"That process will have a great political significance," the minister said. 
"We are to remove dead cells from the public- political tissue. After the 
re-registration we can say that we enter the pre-election period with a more 
or less clear picture. The political scene is acquiring a visible shape." 

There are 3,500 federal public associations, more than 100,000 throughout 
Russia, and only 25 percent of them have been re-registered, the minister 
noted. 

******

#5
Stepashin Describes Policy in Nezavisimaya Gazeta 

MOSCOW, May 20 (Itar-Tass) - Russia's new Prime 
Minister Sergei Stepashin laid out his slates in his article To Revive 
and Enter New Millennium With Dignity published by Nezavisimaya Gazeta on 
Thursday. "The continuity of the policy of political and economic 
stabilsiation alone is no longer enough. Changes are ripe in the very 
tactic of following this policy," he said. 

Stepashin said "there is no place for half-measures and compromises" in the 
government's work. 

Developing the market and supporting property and enterprise, one should not 
forget that "poverty and economic recession create a favourable ground 
for the coming to power of placemen of criminal structures," Stepashin 
said in his article. 

With this in mind, "our patriotic and civil duty is to forget about any 
other interests except for state ones". 

Stepashin cited as priorities of the Russian government the social policy 
with 
growth of personal income, a revitalisation of the Russian industry, 
support of producers and the domestic market, "decriminalisation of the 
economy" and returning "billions of dollars that had been taken out over 
the recent years by various hustlers" to Russia. 

Stepashin said the implementation of passed decisions and "unconditional 
executive discipline" are crucial. 

"Most of the right decisions that have been made over the recent time have 
remained on paper, but there will be none of this anymore," he wrote. 

******

#6
Jamestown Foundation Monitor
21 May 1999

BEREZOVSKY: HE'S BACK. The Russian media continues to buzz about the tycoon
Boris Berezovsky's apparent comeback to a predominant place in Kremlin court
politics. The Kremlin has reportedly nixed Prime Minister Sergei Stepashin's
plans to appoint State Duma budget committee chief Aleksandr Zhukov as first
deputy prime minister in charge of economic policy, leaving railroads
minister Nikolai Aksenenko as the cabinet's single first deputy prime
minister and, it seems, its overall economics tsar (see the Monitor, May
20). Aksenenko, who was named a first deputy prime minister just after Prime
Minister Yevgeny Primakov was fired, is said to be a member of President
Boris Yeltsin's extended political family and to enjoy close relations with
Berezovsky and Sibneft oil chief Roman Abramovich.

According to one account, "the collective Yeltsin" had nothing against
Zhukov's appointment to the cabinet, but it insisted that he would get only
a simple deputy prime ministerial portfolio and that Aksenenko would be the
sole first deputy prime minister. During a meeting on May 19, following
Stepashin's confirmation by the State Duma, Yeltsin reportedly let Stepashin
know in "harsh" terms that this is how things would be. Thus, according to
this account, when the Duma deputies voted to confirm Stepashin, they were
unknowingly voting less for Stepashin than for "Aksenenko's exclusive
powers, fully comparable to those of the government head himself." The same
account noted Stepashin's "extremely gloomy" mood while chairing his first
cabinet meeting yesterday (Segodnya, May 21). 

Berezovsky appears on the verge of scoring another victory: Anonymous
sources today reportedly said that Deputy Interior Minister Vladimir
Rushailo may be named as interior minister, to replace Stepashin (Russian
agencies, May 21). Rushailo is reportedly close to Berezovsky. One
newspaper, meanwhile, reported that another Berezovsky ally, Igor
Shabdurasulov, who currently heads Russian Public Television (ORT), may be
named head of the government apparatus. Shabdurasulov was head of the
department of government information when Viktor Chernomyrdin was prime
minister (Izvestia, May 21).

CHUBAIS APPEARS TO BE THE MAIN LOSER IN CABINET BATTLES. Boris Berezovsky's
apparent victories in the battle for control over the new cabinet reportedly
come at the expense of a rival group headed by privatization architect
Anatoly Chubais, who currently heads United Energy System (UES), Russia's
electricity grid. Both Prime Minister Sergei Stepashin and the man he wants
to name economics tsar, Duma budget committee chief Aleksandr Zhukov, are
said to be close to the Chubais camp.

Izvestia, a newspaper with sympathies clearly toward Chubais and his allies,
today seemed to hold out some hope that the balance of power could be
reversed, but warned of the consequences of failure. "If Stepashin does not
manage to maintain a maximally tough position, the degree of his influence
will be severely limited by the Kremlin. Boris Berezovsky, together with the
'family' as a whole, will have restored their influence completely. One
might ask, what was being fought for in removing Primakov, who at least
neutralized Boris Abramovich [Berezovsky] for a while? And if Berezovsky
regains his former might, it will be impossible to regard [Stepashin] as a
full-fledged premier" (Izvestia, May 21).

Meanwhile, Yegor Gaidar--the former acting prime minister who heads the
center-right coalition Pravoe Delo (Right Cause), along with Chubais, Boris
Nemtsov, Boris Federov and others--made remarks yesterday which could be
interpreted as an admission of defeat at the hands of Berezovsky and his
allies. Gaidar told a meeting of his own political party, Russia's
Democratic Choice, that it was "hopeless" to expect reforms from the
Stepashin government, which he said was "in some ways a caretaker government."

Commenting on Aksenenko, Gaidar said: "He built up the railways very well in
terms of control of financial flows, discipline and so on. The problem is
that those measures and those managers, who are very qualified in a
centralized system... are absolutely unacceptable, are life-threatening for
running a market economy as a whole. We'll see how capable he is of
understanding that" (Reuters, May 21). Gaidar's comments would seem to
suggest that he expects Aksenenko to be in overall charge of economic policy.

One account suggested today that Chubais might now "build on his success and
encroach on the others' estates--to fight for control of Gazprom [Russia's
natural gas monopoly] and United Energy Systems." Berezovsky, the account
maintained, depends completely on the presidential inner circle maintaining
his power and thus might "look for the most exotic variants for extending
Yeltsin's power--for instance, by postponing the presidential elections in
connection with a union between Russia and Belarus." This would be supported
by "a majority of the oligarchs" (Kommersant, May 21).

******

#7
From: "Cohen, Ariel" <ariel.cohen@heritage.org>
Subject: Clean up in Moscow
Date: Thu, 20 May 1999 

Washington Times
May 20, 1999
U.S.-Russian Ties: A Window of Opportunity?
By Ariel Cohen
Ariel Cohen, Ph.D., is a Senior Policy Analyst for Russian and Eurasian
Studies in the Kathryn and Shelby Cullom Davis International Studies Center
at The Heritage Foundation. 

The failure of communists and their allies to impeach Boris Yeltsin may
open new opportunities both for Russian political renewal and for
U.S.-Russian relations. Exit Premier Primakov, a viscerally anti-American
apparatchick; enter Sergei Stepashin, a tough law enforcement pragmatist,
albeit with the stain of the Chechen campaign on his reputation. Yeltsin
swapped the “foreign intelligence” for the “secret police” (both direct
descendants of the Soviet KGB), but he certainly gained a personal loyalist
with reformist credentials as the next Prime Minister. Wiley Boris also
kicked out some senior communists from the cabinet who had reportedly
siphoned off federal budget money into the communist pre-election coffers.
He got rid of the scheming and irritating, but popular Primakov, who was
loyal to himself only and harbored presidential aspirations that could have
endangered the safety of Yeltsin and his family. 

Stepashin, who may be confirmed by a demoralized Duma, is rumored to be
preparing to bring either former Prime Minister Sergei Kirienko or former
Finance Minister Boris Fedorov into his government as economic policy czar.
Stepashin has none of the anti-American idiosyncrasies of his predecessor.
And Anatoly Chubais, controversial architect of Russia’s economic reforms,
who claims credit for Primakov’s ouster, is back advising Yeltsin.
According to Kremlin insiders, the Yeltsin victory is the result of the
reluctance of the Duma deputies to give up their office perks (which would
happen if the parliament were to be dissolved), as well as some serious
behind the scenes palm greasing. It is certainly a defeat for communist
leader Gennady Zyuganov, himself a Y2K Russian presidential candidate.

In the foreign policy arena, the departure of Primakov and his communist
allies from the cabinet may open a new beginning in U.S.-Russian relations.
The West has a great stake in the future of Russia. The ties between Moscow
and Washington have fallen victim to the collateral bombing damage in
Serbia. Yet relations with Russia are an important dimension of U.S.
foreign policy and are necessary if nuclear proliferation from the
deteriorating Russian military is to be prevented, or at least slowed. Ties
with the US are certainly vital for the cause of democracy and market
economy in Russiathe most important post-communist transition. 

The Kosovo crisis served as a catalyst for Russia’s frustration and
resentment over the fall of the Soviet Empire and the subsequent economic
collapse. An unprecedented groundswell of anti-Americanism has been
registered in Russian public opinion since the bombing started. Today, many
in the Russian foreign policy elite interpret the NATO assault on Serbia as
directed against Russia, thus vindicating Primakov’s anti-Western strategy.
US foreign policy managed to succeed where the Soviet propaganda machine
failedour involvement in Kosovo has catalyzed a reversal in what was once
the essentially pro-American Russian public. According to United States
Information Agency and Russian polls, 70 percent of Russians held positive
views of the US in 1993, while only 14 percent still held them in mid-April
1999. 95 percent of Russians believe that NATO bombardment of a sovereign
state in the absence of an attack on any NATO member is illegal.

China may be taking the lead in building the anti-American coalition
Primakov was only dreaming about. Last week, upon returning from a meeting
with Chairman Jiang Zemin, former Prime Minister Victor Chernomyrdin (Boris
Yeltsin’s special envoy to the Kosovo peace process) repeated Beijing’s
demand to stop the bombings before negotiations start. This was the first
time Russia played second fiddle to Chinaan ominous development at the dawn
of the twenty-first century. Primakov may have bought more than what he
bargained foreconomically failing Russia as a raw materials appendage and a
strategic rear to an ascendant China.

The U.S. should act to engage Russia and quickly. The departure of Primakov
and the setback of the communists in the Duma may open a strategic
opportunity for the West in Russia. The Untied States needs to reach those
in Russia who believe that it may be in Russia’s interest to integrate with
the West rather than to seek its fortunes in Beijing, Teheran and Baghdad.
Appropriate overtures now will resonate well with those in Moscow who want
to see their country develop along democratic and free market lines. 

Unquestionably, the preservation of NATO’s cohesiveness and its defensive
purpose must take top priority. But without jeopardizing U.S. and Western
interests, NATO should engage Russian decision-makers, especially those who
are not ideologically anti-American, to search together for a diplomatic
solution to the war. Russia today recognizes the need to achieve autonomous
status for the Kosovar Albanians within Yugoslavia, to introduce armed
peacekeepers into Kosovo, and to keep international humanitarian assistance
on the ground in place. This is a good start. However, Moscow’s
participation in the coming weeks will be handicapped by the on-going
political crisis, as the new government is created.

The U.S. should try to minimize its long term troop commitments to what is
not essentially is neither a vital geopolitical area nor a vital national
security mission. It should invite Russia, Ukraine and other post-Soviet
states to participate in the future international peacekeeping force for
Kosovo. This can be accomplished with NATO retaining overall operational
command.

The U.S. should also promote dialogue on Russia’s future integration into
the global markets and the West. Russians need to understand that in order
to resume economic growth their country must attract foreign investment. In
order to do so, it needs to be more compatible with the Westboth
politically and economically. This may include developing and implementing
comprehensive reformsall those measures, such as restructuring the economy,
establishing the rule of law and privatizing landthat have not been
accomplished so far. Eventually, a democratic and more economically
prosperous Russia, the European Union, and the United States may develop a
long-term strategic relationship for the twenty-first century. 

To reverse the decline, the U.S. should reach out to the Russian people.
The Clinton Administration should pursue to the maximum an effective and
inexpensivepolicy tool: information diplomacy through USIA programs,
Western broadcasting, people to people contacts, and NGO activities. The
Administration must shift budgets within the USIA and the State Department
from low priority areas to Russia-focused programs. This US-Russian
dialogue has to be expanded beyond Moscow, to include the regional elites
who are interested in Western investments and markets for their goods and
raw materials.

With the failure of the Yeltsin impeachment, it is time for Moscow to
abandon its great power nostalgia and concentrate on planning and
implementing the desperately needed reforms and revitalizing the
much-frayed US-Russian relations. Washington should give it a hand.

*******

#8
Academician Says Stepashin Not To Stay Long 

MOSCOW, May 19 (Interfax) -- Sergey Stepashin is 
not very likely to remain prime minister for long, Sergei Markov, 
director of the Institute of Political Studies, told Interfax on 
Wednesday. "One can expect a proud man of integrity such as Stepashin not 
to get along with the presidential entourage. The better he performs as 
prime minister and the higher his rating, the harder it will be for him 
to stay in office," he said. Stepashin "will have to deal with a 
president who obviously hatches plans to get even with the Duma for the 
attempt to impeach him and so can send a hopeless bill such as private 
property of land to the Duma. When the bill fails, the Cabinet may demand 
a vote of confidence. When it expresses no confidence in the Cabinet, the 
Duma will be disbanded," Markov said. This plan may be enacted as early 
as next fall when the deputies end their vacations. 

"Depriving them of free election campaign facilities in the Duma would be a 
well-timed move," he said. This is why Markov said that he thinks that 
Stepashin's appointment has only postponed a confrontation. "In light of 
what the president and his entourage are after, Stepashin must keep his 
distance if he is to play his own game," Igor Bunin, director of the 
Center of Political Technologies, told Interfax The confirmation of 
Stepashin as prime minister is indirect proof that former CIS Executive 
Secretary Boris Berezovsky has not regained his clout despite the 
dismissal of Yevgeny Primakov, he said. "Though he has scored loud 
victories such as the removal of Primakov and the lifting of the 
authorization for his own arrest, Berezovsky has not managed to install 
his man as prime minister," Bunin said. 

****** 

#9
From
EastWest Institute
Russian Regional Report (RRR@IEWS.ORG)
Vol. 4, No. 19, 20 May 1999

NOVGOROD COMMUNISTS CONCERNED ABOUT STEPASHIN. In order to determine the
reaction of local parties to the appointment of Sergei Stepashin as prime
minister, the RRR's Novgorod correspondent interviewed Valerii Gaidym, the
secretary of the oblast's branch of the Communist Party of the Russian
Federation. He said, "The media, and particularly television, is already
trying
to make Stepashin, on one hand, the rightful heir to Primakov, and on the
other
hand, the successor of the market reform policies started by Yegor Gaidar,
Anatolii Chubais, and Viktor Chernomyrdin. But I don't think that Stepashin is
such an experienced economist. Rather, he should be seen as the protege of the
security structures which are capable of imposing order through the use of the
police in case of mass disobedience. One should not forget that Stepashin has
the blood of many young men in Chechnya on his hands. I think that massive
protests are entirely possible given the absurd decisions Yeltsin has made and
the unpredictable decisions that he is likely to make. Stepashin could use
force
to deal with them. He would not stop at shedding the blood of his own citizens
in order to show his loyalty to Yeltsin and preserve the regime until there
are
elections or Yeltsin is no longer alive." - Ivan Novgorodskii in Velikii
Novgorod

KAZAN SORRY TO SEE PRIMAKOV GO, BACKS STEPASHIN. Yeltsin's dismissal of
Primakov
took Tatarstan's leaders by surprise. In two interviews, Tatarstan President
Mintimer Shaimiev expressed real regret that Primakov was gone. In the Russian
political system informal, personal ties are more important than the
relationships between the different authorities defined by the Constitution,
legislation, and treaties. Such ties are particularly important between
regional
leaders and those in charge of the federal government. The constant
changes in
the federal government is extremely disheartening to the regional elite.
The Tatarstani political elite had become used to working with former
Prime
Minister Viktor Chernomyrdin and his government according to an agreed-upon
set
of rules of the game when suddenly Yeltsin replaced Chernomyrdin with Sergei
Kirienko. Just as Tatarstan's rulers were setting up ties with Kirienko, who
came to Kazan during his short tenure, Yeltsin replaced him with Primakov.
Once
again it was necessary to find a way to work with the new prime minister.
Shaimiev had not yet agreed with Primakov and First Deputy Prime Minister
Vadim
Gustov about a framework agreement on inter-budgetary relations when first
Gustov and then Primakov and his government were sacked.
Shaimiev was one of the first regional leaders whom Yeltsin called after
dismissing the government. In his public commentary, Shaimiev did not hesitate
to make clear that his opinion on Primakov was different from Yeltsin's. He
charged that "Primakov and the members of his cabinet should not have been
made
victims of the situation and should not have been used to achieve political
goals." Shaimiev said that Primakov had followed the only possible path and
that
no one else could have done more as prime minister.
Shaimiev was very cautious in evaluating Stepashin, simply noting his
business-like qualities and his work in the power ministries. Beyond that, he
did not say anything. - Midkhat Faroukshine in Kazan

********

#10
From: "Ed Spannaus" <Spannaus_E@mediasoft.net>
Subject: RFE/RL REPORT ON BILLINGTON AND HARTMAN
Date: Fri, 21 May 1999 

RE: RFE/RL REPORT ON BILLINGTON AND HARTMAN

WASHINGTON, May 18 (EIRNS)--TALK ABOUT AL GORE UPSETS SOME PEOPLE. At a
U.S. Institute for Peace briefing today on the topic "U.S.-Russia
Relations: At the Crossroads," former U.S.Ambassador to the USSR, Arthur
Hartman, opened his remarks with an intemperate outburst against Professor
Stephen Cohen of New York University, for Cohen's comments, made on the PBS
"Charlie Rose Show" last week, that the "Gore group" had wanted to get rid
of Russian Prime Minister Yevgeni Primakov.
Hartman said that there is a problem in getting people to
understand what is going on in Russia, and he hoped to hear some
enlightened discourse during the panel discussion, "not like
Stephen Cohen who went on television to say that Primakov was
brought down by Al Gore who didn't want to be running for
President with Primakov in power."
"I mean, this man is allowed on television and is presumably paid by a
university for saying such nonsensical things," Hartman fumed. "So the
American public are not going to learn much from this kind of discourse."
During the question period, EIR's Ed Spannaus pointed out that the view
that Gore was behind the toppling of Primakov is
held widely, both in the U.S. and in Russia. "It didn't start
with the election campaign," Spannaus said, pointing out that
Gore was working with Chernomyrdin, often behind the back of
President Clinton, "going back to last summer, and previous to
that. There's a long history to that."
Michael McFaul of the Carnegie Institute for International
Peace responded, saying that he finds the idea of Al Gore
toppling Primakov "absolutely ludicrous," and tried to ridicule
the idea that Yeltsin would pick up the phone, and Al Gore would
tell him "get rid of that guy," and Yeltsin would do it. "I can
tell you precisely how that decision was made, and Al Gore had
nothing to do with it," McFaul declared. "If anything, it's the
opposite, that Mr. Chernomyrdin is pulling in Al Gore," McFaul
said, adding that "it's Chernomyrdin, using that old relationship
.... friends with Al Gore, to help his own domestic career in
Russia."

******

#11
New Russian State Duma to Be More Left Gennady Seleznyov.

MOSCOW, May 20 (Itar-Tass) - Chairman of the Russian State Duma Gennady 
Seleznyov expressed a viewpoint that a new Russian State Duma lower house of 
parliament would be more Left. 

"The Left-wingers will have more mandates," he said in an interview with the 
Internet here on Thursday. 

Gennady Seleznyov is convinced the Liberal Democratic Party of Russia 
faction, headed Vladimir Zhirinovsky, will not be present in a new lower 
house of parliament. 

According to him, if the Our Home is Russia movement "with a great difficulty 
collects 5 per cent of votes, this will be its great political victory." 

The Duma speaker added that in a new Duma composition there would be more 
representatives of the Yabloko movement, headed by Grigory Yavlinsky. 

In reply to a question how Gennady Seleznyov himself plans to run for a new 
parliament, he said: "I will participate in the first three representatives 
from the Communist Party of the Russian Federation and simultaneously will 
stand for election in a one-candidate constituency." 

The Duma speaker noted that he had about 10 proposals from different cities 
and regions. 

"I have not made a final choice but most likely I will agree on a proposal 
from the Leningrad region to be elected in my native city of St. Petersburg," 
he pointed out. 

In the event of his not being elected to a new Duma, Gennady Seleznyov said 
that he with great pleasure would take up journalism. 

*******

#12
STRATFOR's
Global Intelligence Update
May 21, 1999
www.stratfor.com

Baku Alleges Moscow Brokered Chinese Missile Sale to Armenia

Summary:
On May 18, Azerbaijan registered an official protest with 
Beijing, claiming that China sold Armenia eight Typhoon missiles 
in a deal brokered by Moscow. Recent military cooperation among 
Moscow, Beijing, and Armenia reveals that the CIS strategic 
alliance has been dramatically redrawn. This development could 
result in an intensification of already existing regional 
conflicts between the former member countries of the Soviet 
empire.

Analysis:

On May 18, Azerbaijan registered an official protest with 
Beijing, claiming that China sold eight Typhoon missiles (with a 
range of 37 miles) to Armenia. Azerbaijani Foreign Minister 
Tofig Zulfugarov further claimed that the weapons were sold to 
Armenia by an unnamed joint Sino-Russian company following a 
joint visit by Russian Defense Minister Igor Sergeyev and 
Armenian Defense Minister Vargen Sarkisyan to China. Azerbaijani 
authorities said that there are two possible explanations for how 
this deal took place: either the Chinese government has no 
control over heavy arms sales or Beijing is violating UN Security 
Council resolutions, which prohibit the sale of arms to conflict 
zones. In its response to Azerbaijan's allegations, the Chinese 
embassy in Azerbaijan said that it had no information regarding 
any Chinese arms deliveries to Armenia.

The issue was also brought up at a meeting of the Commonwealth of 
Independent States (CIS) Council of Defense Ministers, which is 
currently taking place in Armenia's capital, Yerevan. At the 
meeting, Armenian Defense Minister Vazgen Sarikisian denied 
Azerbaijan's allegation, saying it was "nonsense." Azerbaijan, 
which had made it clear earlier that it did not plan to extend 
its membership in the CIS Collective Security Treaty, is not 
participating in the meeting. Azerbaijan's Foreign Policy 
Adviser Vafa Guluzade said that his country would not participate 
given that the meeting was being held on Armenian territory. 
According to Guluzade, Russia has intentionally strengthened the 
CIS's security ties with Armenia, thereby alienating Azerbaijan. 
According to an Azerbaijani spokesman, further evidence of 
Russian intentions may be found in their selection of the site 
for the CIS security meeting.

If, in fact, the China-Armenia arms deal was brokered by Moscow, 
it would highlight the dramatic shifts taking place within the 
CIS, and the degree of hostility that they have fueled. Earlier 
this year, three out of the nine original signatories of the 1992 
CIS Collective Security Treaty -- Georgia, Uzbekistan, and 
Azerbaijan -- made it clear that they did not intend to continue 
as members in the alliance. The three former Soviet republics 
said they were dissatisfied with Moscow's dominant position and 
its policies toward the CIS. On May 20, only six CIS countries -
- Russia, Armenia, Belarus, Kazakhstan, Kyrgyzstan, and 
Tajikistan confirmed their readiness to extend their membership 
in the alliance. The original treaty will expire this month. 
Uzbekistan, Azerbaijan, and Georgia have already joined in a 
security alliance with Ukraine and Moldova, two CIS members that 
never joined the Security Treaty in the first place. That 
alliance operates under the auspices of NATO's Partnership for 
Peace program. 

In addition to the defections from the CIS, there are other 
indications that the alliance is crumbling. According to 
Guluzade, Russia had to deal repeatedly with Kazakhstan and 
Belarus's unwillingness at past CIS security council meetings to 
assist Russia with its military commitments in Tajikistan and 
Georgia. To counterbalance these tendencies that threaten to 
tear the CIS security alliance apart, Moscow is now openly 
reinforcing its politico-military ties with those CIS members 
that are still prepared to follow its lead. And as NATO becomes 
a central issue in the CIS division, Russia's confrontational 
behavior can only be expected to intensify.

On May 21, NATO announced that it was considering Georgia as a 
possible candidate for associate membership in the alliance. This 
undoubtedly would encourage Azerbaijan, a country that had 
previously asked NATO to station its forces on its territory, to 
seek closer cooperation with the Western alliance. Russia is now 
playing an old game among the former Soviet republics: divide 
and, if not conquer, then at least develop a pivotal influence. 
By openly reinforcing its alliance with Armenia through the 
brokering of missile sales, Russia is seeking to reestablish its 
influence in the region. By pursuing relations with Azerbaijan 
and Georgia, NATO is doing the same. As tension escalates 
between Yerevan and Baku, Moscow and Brussels may find the 
seriousness of their commitment to their proxies put to the test.

********

#13
Interfax Analyst on Luzhkov as Rival to Yeltsin 

By Interfax political analyst Natalia Timakova 

MOSCOW, May 19 (Interfax) - The Duma's approval of 
Sergei Stepashin as Russia's new prime minister can serve as another 
confirmation for the Kremlin that the left-wing opposition, despite the 
steady popularity of Communists and their sympathizers in every poll, 
will not be its most dangerous rival in the upcoming Duma elections. Like 
half a year ago, Moscow mayor Yuri Luzhkov is regarded as a greater rival 
by President Boris Yeltsin's administration. Surprisingly, the Kremlin's 
barometer Vladimir Zhirinovsky, who has been specializing in accurate 
political forecasts lately, was the first to sense it. On Tuesday the 
Liberal Democratic leader sent a letter to Yeltsin suggesting that he 
"liquidate the post of the mayor of Moscow and replace it with the post 
of a member of the federal government - the minister for Moscow affairs." 

His reason was that Luzhkov controls "more militarized associations and 
organizations than the president or federal government." It is quite easy 
to find an explanation to this seemingly strange proposal. This is 
evidently a symbolical reply, to use a Kremlin term, to Luzhkov's recent 
statements. Since the beginning of the Cabinet crisis and the rumors of 
Yeltsin resorting to extreme measures such as dissolving the Duma and the 
declaration of a state of emergency, Luzhkov has tirelessly repeated that 
he will not permit any extraordinary things in Moscow and will see to it 
that constitutional norms are not violated. Thus, he made it clearly 
understood to the Kremlin that he would not support any possible Kremlin 
steps that could aggravate the situation in Russia and lead to early 
elections. Moreover, he definitely took the dismissal of Yevgeny Primakov 
as the revenge of the political and financial circles against which he 
fought. Luzhkov continued this line on the sensitive question of the 
ouster of Prosecutor General Yuri Skuratov. Not a day passes without 
Luzhkov saying that Skuratov should remain in office. On Wednesday, he 
said again that he finds the dismissal unlawful even though "this is not 
to the liking of the president." Luzhkov had one more unpleasant surprise 
for the presidential administration. Hardly had the administration 
decided that it is possible and necessary to work with Yabloko leader 
Grigory Yavlinsky in the Duma elections and maybe in the presidential 
elections, than Yavlinsky and Luzhkov started active consultations on 
rapprochement. According to sources in the administration, Luzhkov's 
moves were immediately taken as confirmation of his dislike for the 
Kremlin. Evidently, Zhirinovsky was let into the arena in order to reduce 
Luzhkov's ardor and give him a clear signal. But Luzhkov can hardly be 
intimidated in such a way. The mayor's circle sees much greater danger in 
Kremlin's attempts to find its own candidate for presidency and bring him 
to victory through mobilizing enormous resources. The apprehensions of 
Moscow's leadership only grew after the appearance of a promising new 
prime minister supported by the Duma and close to Yeltsin. In a recent 
interview with Newsweek, Yavlinsky, a presidential hopeful, openly said 
that Stepashin would be a threat to him, because he intended to run in 
the presidential elections and a threat to Luzhkov too. Evidently, 
Luzhkov not only sees the danger but is trying to take steps in advance 
to minimize possible losses. On Wednesday Moscow city duma chairman 
Vladimir Platonov said the mayoral elections may be held in December 1999 
simultaneously with the parliamentary elections instead of summer 2000. 

He gave purely economic reasons even though the plan is clearly 
political. Only a few hours later an appropriate bill was submitted to 
the city legislature. After being re-elected in December Luzhkov may 
fearlessly enter the presidential race, because if he fails, he will 
nevertheless remain mayor. However, if the elections are held in summer, 
Luzhkov will have to choose between presidential and mayoral elections. 

*******

#14
Moscow Times
May 21, 1999 
LIVE FROM MOSCOW: Duma Elections a Bit of a Gamble 
By Natalya Shulyakovskaya
Staff Writer

Russia's financial markets may be comatose, but one financial exchange offers 
a chance to indulge that pent-up urge to speculate: futures trading on the 
results of the final State Duma elections. 

Of course, they aren't regular futures, since there's no deliverable 
commodity behind them. The idea of the Russian Exchange is to have fun. 

The stakes are not as high as they are for the politicians running: Each 
"contract" purchased requires only a 2,000-ruble ($80) deposit and bets can 
be placed by phone through one of the exchange's brokers - though most of the 
players are brokers themselves, who don't have many real futures to trade 
these days. 

The futures of the Communists and the Otechestvo, or Fatherland, party of 
Moscow Mayor Yury Luzhkov get traded most actively. 

"Traders" bet on what they think the candidate's vote percentage will be in 
the election, though most people don't wait for the election but bet on the 
candidate's percentage rating at the end of the day, based on what other 
people bet. 

The starting positions for the parties' futures were based on surveys by the 
All-Russia Center for the Study of Public Opinion, or VTsIOM. 

Over 12 weeks of betting, the Communists have fallen from 25 percent to 20.83 
percent, Yabloko went up from 8 percent to 9.9 percent, Otechestvo dropped 
from 15 percent to 13.9 percent, and Right Cause, the new liberal party lost 
0.2 percent from its initial 2 percent standing. 

The market responds quickly to political events: As soon as Viktor 
Chernomyrdin was named envoy for the Yugoslavia crisis, the rating of his Our 
Home Is Russia party went up 29 percent. 

"Our trades come the closest to the actual [election] results. No VTsIOM, no 
other sociological institute could do that," said Pavel Panov, president of 
the Russian Exchange. 

The practice began with betting on the 1996 presidential election. Panov said 
brokers were only 0.12 percentage points off in their prediction of how 
President Boris Yeltsin would fare in the first round. For the run-off, the 
brokers underestimated Yeltsin by 1.89 points predicting he would gather 
52.50 percent of the vote instead of the real result of 54.39. They 
overestimated contender Gennady Zyuganov, leader of the Communist Party, by 
1.77 points. 

In 1996, when as many as 5,000 bets on presidential candidates were made 
daily, some of the traded personalities visited the exchange and showed 
themselves off for the traders. 

"I think only Boris Nikolayevich [Yeltsin] did not visit us," said Larisa 
Smirnova, the head of the exchange's futures department. 

"I am already getting calls from the heads of the parties who have gotten 
word that we had started trading," Smirnova said. "So far, all they are 
offering is help and moral support and ask if they could please see our 
results. And we don't turn them down." 

Duma Deputy Viktor Peshkov, a secretary of the Communist Party responsible 
for election technologies, said that the party does not have an official 
stand on betting. But personally, Peshkov added, he detested the idea. "If 
the law allows it, so be it. ... But I would never bet on another human 
being," he said in a telephone interview. 

One pollster says the betters' guesses about how people will do were fairly 
accurate, but not better than professional polling. 

"They came pretty close, but our data were the most accurate," said Leonid 
Sedov, political analyst with VTsIOM, adding that it was VTsIOM who won the 
special accuracy contest that the Central Election Committee held among the 
survey firms in the 1996 election. 

But it was the political analysts who seemed to be the most excited about the 
news of the political betting reopening. 

"I will play again," said Andrei Piontkovsky, director of the Center for 
Strategic Studies. "This is entertaining; it gives some political 
perspective. Besides, people get bored. They need some excitement. When the 
Hippodrome closed some time ago, I remember people standing in front of the 
building and making bets on what tram would arrive next." 

Then, he paused and added, rapid-fire: "I would buy Yabloko, sell Otechestvo, 
sell the Agrarians, and buy Right Cause." 

*******

#15
Vladivostok News
May 21, 1999
Communist Sells Icons But Worships Soviets 
By Russell Working 

Every Sunday in Pokrovsky Park, hobbyists sell tsarist coins, Pacific Fleet 
insignia and Oktyabryonok badges depicting a curly-haired baby Lenin with a 
beatific expression, seemingly capable of healing the blind and the lame. 

The collectors sit around a paved square, their wares displayed on the 
benches: a paratrooper's wings, a button of Gorbachev's face with the ironic 
words, "The First President of the USSR," a medal honoring the Soviet 
liberators of Afghanistan. 

On the edge of the square, a shop sells old crucifixes and triptychs to raise 
money for the Orthodox Church. And it was here that I met a communist icon 
dealer. 

I will call him Damir Ilyich. I didn't get his full name because, in a fit of 
pique that my mother would assure readers is entirely unlike me, I quarreled 
with this elderly citizen with a lurid nose and a narrow-lapelled polyester 
jacket. 

I admit it was my fault. While studying the icons on the wall, I mentioned 
something I had noticed in the Kremlin armory. In a dozen instances, the 
golden or silver part of an icon - the body of Christ or a saint - was 
intact. But the painted portion, the faces and hands, has disappeared, so 
that the icons resemble Angels of Death - hooded robes with no one inside. It 
doesn't take a genius to see that the Bolsheviks destroyed the medieval 
paintings but couldn't part with the gold. 

Damir Ilyich bristled at my suggestion. "Communists never destroyed anything. 
They built the mightiest nation on Earth, so that even you Americans feared 
us." 

"I agree that they built a powerful nation, but I'm talking about icons." 

"They didn't destroy any icons. I have traveled to many countries, and you 
see the same thing there." 

"They must have been Russian icons," I said. 

"It is the democrats who are ruining Russia," Damir Ilyich said. "The 
Communists made it great." 

The Soviets murdered all that was exemplary in Russia - artists, writers, 
scientists, priests, free thought itself. They created a monstrous system 
that, like a decapitated dinosaur, staggered on under its own momentum for 70 
years. Yet Gulag denial, like Holocaust revisionism in Germany, persists. 

Pokrovsky Park is nevertheless a curious place to find a religious shop. In 
1938, Bolsheviks dynamited the Pokrovsky Church and paved over its graveyard. 
They built an amusement park and sponsored dances, thus affording young reds 
the pleasure of dancing polkas on the bones of their grandparents. 

I wanted to ask Damir Ilyich: Did you dance, too? And if so, how do you find 
it in your soul to sell crucifixes here? 

******

#16
Washington Post
May 21, 1999
Letter
Worse Than the Serbs

I read it again and again in The Post: The Clinton administration describes 
the expulsions of the Kosovars as being on a scale not seen since World War 
II. That's not true. It's not even close.

The European "ethnic-cleansing" champions are our own NATO allies: the Czechs 
and the Poles. After World War II -- in peacetime -- they ethnically cleansed 
the entire populations of East Prussia, East Pomerania, Silesia and the 
Sudetenland. For centuries until 1945, these areas were entirely German 
populated. By 1949 -- after years of rape, murder and beatings -- all 15 
million Germans were gone. Their churches and monuments were dynamited, their 
cemeteries were bulldozed, and their civil records were burned. 

Today's Czechs and Poles pretend the Germans never lived there at all. And, 
best of all, they have no pesky minorities to deal with. 

This is the real lesson of history, as demonstrated by our new allies and 
well learned by the Serbs: Clean out your minorities -- do it any way you 
want. Then lie low for a few decades, and you'll be welcomed into NATO. 

BRAD PEASELEY
Richmond 

*******