July 16, 1999    
This Date's Issues: 3395 •   •

Johnson's Russia List
#3395
16 July 1999
davidjohnson@erols.com

[Note from David Johnson:
Advance warning: On Saturday I leave for a week in the wilds
of Virginia near Charlottesville. I'll have my laptop computer
with me and we'll see what develops. Let's hope for a slow news
week.
1. Itar-Tass: Moscow Beer Festival Expects Over One Million Guests.
2. AFP: Moscow struggles to face up to rampant street prostitution.
3. Moscow Times: Andrei Piontkovsky, SEASON OF DISCONTENT: Neurotic Elite 
Loves West, Hates West.
4. Moscow Tribune: What Do Russians Fear? 
5. RFE/RL NEWSLINE: NIZHNII REFORMERS' PAST UNDER SCRUTINY. 
6. AP: Russian Corruption Scandal Revived.
7. Jerry Hough: We must get beyond the moralistic outrage.
8. Rossiyskaya Gazeta: New Plan for Single-Seat Electoral Districts.
9. Itar-Tass: Berezovskiy Urges Capitalists To Play Open Politics.
10. Itar-Tass: Daily Says Berezovsky Seeks Control Over Gazprom Money.
11. The Economist: Manipulating Russia's press.
12. AFP: Russian Jews shocked by synagogue stabbing.
13. Rossiyskaya Gazeta: Russian Support for Compatriots Abroad Planned.
14. Moscow Times: Sergei Markov, The Kremlin's Options.
15. Reuters: Accused Russian Nuclear ''Spy' Faces New Problems. (Nikitin)]

*******

#1
Moscow Beer Festival Expects Over One Million Guests.

MOSCOW, July 15 (Itar-Tass) -- Up to 1.5 million guests are expected to 
converge on the Moscow beer festival which will open in the Luzhniki sports 
complex on July 17 to completion on July 25. 

Moscow vice-mayor Valery Shantsev told a press conference on Thursday that 
five Moscow breweries, two beer brewing companies from St. Petersburg, 
brewers from Tver, Klin, Yaroslavl and Chuvashia and Germany's Debasus 
brewery will take part in the festival. 

Up to 300,000 Muscovites are expected to visit Luzhniki over the coming 
weekends. Head of the Moscow administration of mass- scale public events Oleg 
Belikov said, "Our festival is the only opportunity for thousands of people 
to have a beer shoulder to shoulder with others." 

Moscow government minister Yevgeny Panteleyev, who heads the science and 
industrial policy department, said Moscow Mayor Yuri Luzhkov will tap the 
first cask of beer to offer drinks to festival guests. 

Beside the Moscow city government, the festival organisers include the 
Luzhniki Olympic complex administration and the Association of beer buffs. 

Valery Shantsev said not only beer but also soft drinks, snacks and ice-ream 
will be available in Luzhniki, so that "everyone will have what one likes and 
can afford." For those who decide to take the kids to the festival there will 
be an entertainment park with bands playing, rollerdrome, and games of all 
kinds. 

On weekdays, a fair will open at noon from Monday to Friday and variety shows 
will begin at 17.00. No fair will be open over the weekends, but 
entertainments will be offered from noon to 22.30. The Beer World exhibition 
will be open from July 17 to 25 and presentations of new technologies will be 
held regularly. 

The festival closing ceremony will take place on July 25. 

*******

#2
Moscow struggles to face up to rampant street prostitution

MOSCOW, July 15 (AFP) - Every night at dusk, Natasha Strogonova joins the 
bevy of women near Moscow's Dinamo sports stadium to earn in a few hours many 
times more than the monthly wages she took home in her previous job as a 
store clerk.

"I have two children. I need money," said Strogonova, 28, who will spend six 
months in Moscow before returning to her home town of Ivanovo, north of the 
capital, and live off her earnings as a prostitute.

Moscow is struggling to cope with pervasive street prostitution -- perhaps 
the worst in eastern Europe -- and officials acknowledge the problem is 
probably here to stay.

As many as 60,000 women work in the sex trade in Moscow, most of whom arrive 
from outlying Russian regions and former Soviet republics, according to 
Viktor Yegorin, who heads a Moscow unit of the interior ministry formed two 
years ago to tackle the prostitution boom.

Lured by the prospect of higher earnings, tens of thousands of women converge 
on Moscow where living standards continue to far outrank those of Russians in 
the regions, despite last August's financial crash.

In Ivanovo, Natasha earned 500 roubles a month (25 dollars), a pittance 
compared to the 25,000 roubles she is paid for performing sexual acts in 
Moscow.

While some prostitutes work in hotels and escort services, most of them walk 
the streets, or rather gather at designated "tochki" (points) in the city in 
organised groups protected by bodyguards.

"Why do we have so many prostitutes ? Because our country is in a state of 
economic collapse," Yegorin said in an interview this week from his office 
near Red Square.

"As long as that issue is not being addressed, it will be very difficult to 
talk about solving Moscow's prostitution problem."

A 1997 study by the US human rights group Global Survival Network singled out 
Moscow as a hub of the eastern European sex trade, which has supplied women 
to prostitution rings in Germany, Poland, Japan and Macau.

Moscow police have recently clamped down on prostitution on Tverskaya street, 
the capital's main thoroughfare, where women once crowded the sidewalks, 
drawing complaints that the city center had become a public brothrel.

The women were pushed further north near Dinamo where Natasha now works while 
others have moved to the train stations. 

"We are gradually trying to gain control of the situation," Yegorin said.

But he admitted that the efforts of his 10-man unit are often undermined by 
police who act as accomplices, helping the women obtain residence permits and 
carry out their business in exchange for bribes.

While Muscovites complain loudly about the street prostitutes who have moved 
into residential areas, politicians have stayed clear of the issue, perhaps 
sensing that they cannot promise solutions.

"We will not be able to escape this," warned Emma Safarova, the head 
physician at the Sana health center which has started an outreach project to 
help the women. "If we put them on a train, they will just come back." 

Since May, the Sana center is offering free health care to the women, who are 
among high risk groups for HIV infection and for other sexually-transmitted 
diseases.

The program, funded by the Russian health ministry, is keeping up-to-date 
information on the prostitutes through surveys and offers counselling to help 
them protect themselves.

It also produced a brochure this year titled "How to safely engage in sex and 
sex business" that caused a stir for its pragmatic advice to prostitutes 
about condoms and dealing with clients.

Safarova contends that authorities must resist the temptation of driving 
street prostitutes into the jaws of Moscow's burgeoning criminal underworld 
where they will be beyond reach.

"Hopefully, prostitution will only be a short episode in these women's 
lives," she said. 

*******

#3
Moscow Times
July 15, 1999 
SEASON OF DISCONTENT: Neurotic Elite Loves West, Hates West 
By Andrei Piontkovsky 

A mathematician-turned-political analyst, I am more and more becoming 
political analyst-turned-psychoanalyst, investigating the complexes of 
the Russian political elite's collective unconsciousness. 

I study this subject through observation and experimental interaction with 
individual species of this class. 

I have often heard different people on different occasions repeating - with a 
look of extreme self-importance and self-adoration - the exact same phrase, 
word for word. The entire Russian political elite, they say, with the 
exception of some isolated marginalized figures, is united as never before in 
denouncing or praising something - denouncing, for example, NATO enlargement, 
or praising Yevgeny Primakov's vision in putting forth the idea of a 
Russia-India-China strategic triangle. 

Why do they say they are united as never before? The same political elite, in 
its previous incarnation (when they were all active Communist Party 
functionaries) was united on every issue - with the exception, of course, of 
some isolated marginalized figures, who were either kept in psychiatric 
asylums or exiled. And if Russia's political elite is so united, concerted, 
determined, then why is Russia's foreign policy so inconsistent, to put it 
mildly - or so schizophrenic, to put it frankly? 

On several occasions, in my presence, a leading liberal State Duma deputy put 
forward for our foreign colleagues the following set of arguments. 

Point No. 1. NATO committed a blatant aggression, and all Russians, in their 
deep indignation at the United States and NATO, will view them as the main 
enemy for many years to come. 

Point No. 2. Russia contributed enormously to settling the Balkans crisis. 
(Keeping Point No. 1 in mind, what did Russia contribute to? To bullying 
innocent victims of aggression into capitulation?) 

Point No. 3. We expected to be rewarded. (For what? First encouraging 
Slobodan Milosevic in his criminal and suicidal policy, and then selling him 
out? And rewarded by whom? By Russia's public enemy No. 1?) 

Point No. 4. We have not been rewarded enough and thus feel humiliated. 

This very typical mixture of recriminations, complaints and self-pity looks 
more like hysterical reactions driven by psychological complexes than a 
coherent and rational foreign policy. 

Russia's attitude to the West has always been very ambivalent, contradictory 
and emotionally charged. More than 80 years ago this dramatic relationship 
was most powerfully expressed by our great poet Alexander Blok in his famous 
poem "The Scythians": "She [Russia] looks, looks at you with hatred and with 
love." 

Today, the traditional dramatic attitude of Russia's political class toward 
the West has turned farcical. We seemingly need two different Wests. One - to 
blame for all our failures; to denounce; and to regard as inferior to our 
spirituality and sobornost. The other - to ask for credits and humanitarian 
food aid; as a place to send our children and grandchildren for study at 
Cambridge; or, for the most outstanding of us, to buy castles on the CÙte 
d'Azur. 

We have found a sophisticated way to overcome this split of consciousness. We 
have designated NATO to be our whipping boy - the bad West. Then there is the 
good West, with whom we condescendingly agree to cooperate in the 
above-mentioned spheres. It's called the European Union. 

*******

#4
Moscow Tribune
July 15, 1999 
What Do Russians Fear? 

Russians today are more fearful than ten years ago, according to a recent
survey. They live with a very high level of anxiety about poverty and
unemployment, while they are unconcerned about overpopulation and global
warming. 

Over 1000 adults (18 to 60-years-old) from the five main regions of the
Russian Federation were asked about their attitudes towards nuclear war,
civil war, terrorism, genocide, corruption, repression, natural disasters,
the end of the world, epidemics, the ozone layer, chemical radiation,
catastrophic crop failure, invasion by Islam, seizure of the Earth by
aliens, etc. 

The survey conducted by Prof. Vladimir Shlapentokh (Michigan State
University) and Russian sociologist Prof. Vladimir Shubkin found that
Russians fear poverty most and feel completely uncertain and helpless about
their future. 

Lawlessness, unemployment, crime and corruption are the greatest sources of
anxiety. Many worry about ecological disasters,chemical and radiation
poisoning and epidemics. A lesser number fear nuclear weapon proliferation.
In general, the level of anxiety is extremely high. 

Overpopulation, alien invasion and invasion by Islam are considered
ridiculous. On the whole, Russians are quite tolerant of others. They are
not interested in anti-Semitic propaganda or Masonic ideas. 

The degree of pessimism experienced by retired persons and the number of
women who feel constantly afraid is twice that of men. 

Ninety percent state that the earnings from their primary job are not
enough to provide a satisfactory standard of living. Thus, 70 percent grow
foodstuffs on their own land. Very few are able to obtain an additional job
corresponding to their education and skills. 

Despite the high degree of fearfulness, few Russians are motivated to act.
Two-thirds choose passivity. They say their actions cannot influence
politics nor economics. Seventy percent are prepared to endure suffering. 

With several months before the December Duma elections remaining, 40
percent have no political preferences at all. At the same time, more than
85 percent say they will vote in the elections. The majority will vote for
parties that champion Russia as a great power and parties which support
Russian originality. The minority will vote for the free market orientated
blocks. Half of those polled would like strong state control over the
economy. And fewer than 10 percent prefer to continue with market reforms. 

Despite the high level of fear, one-third say they are stress-free. Eighty
percent do not find it difficult to deal with all their hardships. And 60
percent said their relationships with others have not grown more difficult
recently. 

"Some fears are individual in nature even if they are found in groups of
people, such as fears regarding one's health, the fear of poverty or of
becoming a victim of crime," says Shubkin. "Some fears are universal in
nature. In contrast to unemployment-- global warming or holes in the ozone
layer can't affect some while leaving others untouched. 

*******

#5
RFE/RL NEWSLINE Vol. 3, No. 136, Part I, 15 July 1999

NIZHNII REFORMERS' PAST UNDER SCRUTINY. The Prosecutor-
General's Office has launched a criminal investigation into
former First Deputy Prime Minister and ex-Nizhnii Novgorod
Governor Boris Nemtsov for possible violations of campaign
finance laws during his 1993 Federation Council bid,
"Tribuna" reported on 15 July. Meanwhile, "Obshchaya gazeta"
in its 1-7 July issue examined former Premier Sergei
Kirienko's activities at the Garantiya Bank in Nizhnii
Novgorod. The newspaper claims that Kirienko "launched his
career bilking old people" and describes how under his
leadership the bank diverted monies from the oblast Pension
Fund. Among the methods used were withholding dividends to
the fund, which was the bank's main shareholder, and engaging
in various schemes with promissory notes that, "according to
certain calculations," made up to $10 million a month. The
newspaper also describes how the bank concluded an
information-processing contract worth 14.9 billion old rubles
for "17 pages of text paraphrasing newspaper articles." One
of the two companies involved, AMK Concern, was owned and
managed by Kirienko. JC/JAC

*******

#6
Russian Corruption Scandal Revived
July 15, 1999
By JUDITH INGRAM

MOSCOW (AP) - The opening of a Swiss criminal probe into possible money 
laundering by aides to President Boris Yeltsin has revived a corruption 
scandal that allegedly reaches the highest levels of power in Russia.

A Swiss official said Wednesday that a criminal investigation had been 
launched into alleged money-laundering by Kremlin financial manager Pavel 
Borodin and other Russian citizens. Swiss prosecutors have asked Swiss banks 
to freeze assets of 22 people suspected in the case, including Borodin, his 
wife, and top members of Yeltsin's administration, according to Swiss media 
reports.

``We have reason to suspect it was bribe money being laundered,'' Swiss 
investigating judge Daniel Devaud was quoted by The Moscow Times as saying.

Borodin rejected the allegations.

``Neither I nor my wife have anything to do with Swiss bank accounts,'' he 
was quoted as saying by Interfax news agency. ``All these media attacks on me 
have been made on clearly political orders.''

The Kremlin had no comment, but Yeltsin was expected to defend his top 
financial aide - the man responsible for providing housing and other material 
comforts for the president and his family.

``There will be a very sharp reaction from the presidential administration, 
because now there's talk about concrete names ... people close to Yeltsin,'' 
said Yevgeny Volk, director of the Moscow office of the Heritage Foundation.

Corruption has long played a leading role in Russian life at all levels, 
often dictating such everyday decisions as who will get a business license or 
whose son will be excused from army service.

It has positively bloomed in post-Soviet Russia, where savvy businessmen with 
political connections have been able to get rich quickly through the 
privatization of state-owned property.

While Yeltsin has not been personally linked to corruption allegations, his 
administration has done little to fight endemic graft in the government.

The Kremlin has been fighting persistent opposition and media allegations of 
influence-peddling by the members of Yeltsin's close circle, including his 
daughter Tatyana Dyachenko. She has been tied to controversial tycoon and 
Kremlin insider Boris Berezovsky, who is also being investigated for his 
involvement in the finances of Russia's largest airline, Aeroflot.

The first reports of the kickback scandal emerged in January, when Swiss 
officials at Russia's request searched the offices of a construction company 
called Mabetex. Russian investigators suspected that Mabetex had bribed top 
officials for lucrative renovation contracts.

In February, Swiss Federal Prosecutor Carla del Ponte informed Russian 
Prosecutor General Yuri Skuratov that Mabetex had been regularly transferring 
large amounts of money to a Swiss bank account.

Skuratov has been battling to keep his job ever since, and says that attempts 
to remove him from office are an effort to curb the probe. Yeltsin suspended 
Skuratov, but he has refused to leave.

Russian prosecutors searched Borodin's office in March and confiscated 
documents involving Mabetex, but no charges have been made. Both Mabetex and 
the government say they did no wrong.

Borodin's lawyer, Boris Kuznetsov, said in an interview Thursday in the 
Kommersant daily that the allegations against Borodin were ``a purely 
political action against the president of Russia, initiated by Swiss 
Prosecutor Carla del Ponte.''

Del Ponte has continually pledged Swiss support in Russia's inquiry.

Swiss prosecutors have also been investigating the tycoon Berezovsky and his 
involvement in the finances of Aeroflot, headed by Yeltsin's son-in-law, 
Valery Okulov.

In April, Russian prosecutors issued a warrant for Berezovsky's arrest on 
charges of hiding Aeroflot's hard currency earnings in Swiss firms. The 
warrant was later revoked.

Last week, though, Swiss prosecutors seized a large number of documents from 
two firms in Lausanne, Switzerland, that are linked with Berezovsky: Andava 
and Forus Service.

The tycoon founded the companies in 1994, one day after Aeroflot was 
privatized, Russia's Izvestia daily reported on Thursday. Berezovsky is 
accused of funneling $250 million through the two firms.

*******

#7
Date: Thu, 15 Jul 1999
From: Jerry F. Hough <jhough@duke.edu>
Subject: We must get beyond the moralistic outrage

We must get beyond the moralistic outrage (or earlier moralistic 
glorification) aimed at Russia! Helmer talks about the outrage of the US
steel import quotas. That is modern capitalism. That is why the NAFTA 
"free trade" treaty has 1000 pages. If Russia is going to introduce 
modern capitalism, it must understand what a mixed economy means and that 
it has very little to do with the neoliberal model. All countries have 
industrial policies (how did America become dominant in the airplane and 
computer industries or Al Gore become crucial in the development of the 
Internet, as he did?) and developing countries more than industrialized ones.

The US steel policy is right. Why should we destroy our steel 
industry because the Russians have a crazy policy? Russian steel is 
needed to build machinery to reconstruct Russian industry, it is needed 
for Russian buildings. Our policy toward Russia should be the same as 
our policy toward Japan--to push them to jump-start their domestic 
economy and develop domestic demand. A limitation on steel (and 
fertilizer) exports is an intelligent part of such a strategy.

Obshchaia gazeta gets outraged at Kiriyenko getting rich from the 
old people. I do not know how corrupt he and Nemtsov were. Maybe a lot 
and maybe not at all. The worst is that Garantiia made a "profit" and paid 
both no doubt received dividends, thereby increasing the size of the Russian
private service sector in statistics hailed in the US. But Nemtsov was 
and is obkom first secretary. Kiriyenko is and was a young party 
apparatchik who was obkom secretary for social questions.

March 1993, when Garantiia was formed, is an important date because
that was when Yeltsin was dismantling the ministerial system that dominated 
Russian industry in 1992 (Avtoselkhozholding, Roschermet, etc.) and that 
made a mockery of all the disinformation about inter-enterprise loans and 
uncontrolled inflation in 1992. He was replacing it by a sovnarkhoz-like 
system dominated by the governors as he moved to a new political system 
in a new constitution in which the key power was exercised by the 
Federation Council--his Central Committee plenum. So long as the 
regions had no independent taxation power and were dependent on Yeltsin 
for approval for the type of subsidies they could say, they had to 
support him. Since Federation Council approval was needed to override 
his vetoes or for the Duma to override his decrees, he had total power 
over the Duma he was planning to install.

David Hoffman described Kiriyenko as an altrusist helping pensioneers with
the funds of Nizhnii's Norsi Oil Refinery, the third largest in Russia. 
That was closer to the truth than Obshchaia gazeta, except that it was 
not altruism. Kiriyenko's job (and that of his counterparts in every oblast)
was to be the governor's man is distributing the income from places like
Norsi 
between social needs. When could pensions be delayed so the money could 
be used for other purposes? When could the refinery workers not be paid 
so pensions could? What could they delay payments to their supplier, 
Tatneft. I don't know if Kiriyenk was the distributor of oil to the 
local farms, but he became director of Norsi. Then when Nemtsov went to 
Moscow, he took Kiriyenko with him to perform the same functions at the 
national level.

The IMF forced the Russians to put their subsidies off budget. 
It was the height of ignorance or hypocrisy that the West then 
praised the people like Nemtsov and Kiriyenko playing an assigned political 
and politicized role (which presumably they played well and should not be 
criticized for doing their job) as technocrats and private 
entrepreneurs. It led to lack of transparency and the possibility of
corruption. But the problem is not the corruption, but the system of 
off-budget subsidies that robbed investment to try to keep consumption afloat.
It is Russian newspaper correspondents who want to keep writing moralistic
plays instead of understanding their own country and Westerners who 
don't cut behind the facade. 

The person who can win the next election is one who wraps 
nationalism in a return to Nikolai II, Witte, and Stolypin. The West 
has the illusion that the next election is going to be between those on 
the neoliberal part of the spectrum. Far better if we tried to push 
Russian politicians to tie nationalism to an industrial policy 
emphasizing investment than to have someone tie it to something awful.
It would also be good for our steel and aluminum industries and for Iowa 
grain farmers.

*******

#8
New Plan for Single-Seat Electoral Districts 

Rossiyskaya Gazeta
July 10, 1999
[translation for personal use only]
Article by Anna Kozyreva under the rubric "Politics. Economics. 
Elections": "The Central Electoral Commission Has Divided the 
Country Into Districts" 

The new Federal Law "On Elections of Deputies of 
the State Duma of the Russian Federation Federal Assembly" took effect on 
3 July. In accordance with it, the Central Electoral Commission is 
supposed to submit a plan to the State Duma for forming single-seat 
electoral districts and conducting elections of the deputies of the new 
convocation for examination. 

In submitting the new plan to the Central Electoral Commission [TsIK] 
for confirmation yesterday, TsIK chairman Aleksandr Veshnyakov noted: The 
Electoral Commission tried to preserve the scheme which already exists to 
the maximum extent possible. But the number of voters in some subjects of 
Russia has changed. Moreover, many republics, krays, and oblasts sent 
their own proposals on forming districts and the boundaries of these 
districts to the TsIK. 

In developing the new scheme, the TsIK proceeded first from a uniform 
norm for voter representation per single-seat district--a little more 
than 472,000 people. This number was obtained by pure arithmetic, 
dividing the total number of Russian voters by the number of single-seat 
districts, of which there are now 225. Since it is not possible to form a 
common electoral district on the territory of two subjects, the uniform 
norm of representation will be slightly less in 21 subjects of the RF. So 
in comparison with elections of State Duma deputies of the second 
convocation, the number of single-seat districts in the new elections 
will increase in the Republic of Dagestan and Krasnodar Kray and decline 
in Murmansk and Chita oblasts. 

Some Russian citizens live abroad or are working abroad on a long-term 
basis. Their number has doubled today as compared with past elections. 
These voters will be assigned to 23 electoral districts in 5 subjects of 
the Federation: Moscow and St. Petersburg as well as Moscow, Leningrad, 
and Tula oblasts. By the Way 
Russian President Boris Yeltsin expressed confidence yesterday that as a 
result of the elections to the State Duma, "The democratic wing will be 
in the majority in this chamber of parliament." 

Talking with journalists before his meeting with Premier Sergey Stepashin 
started, the head of state said that at his meeting with leaders of a 
number of Russian regions held on Thursday, they "expressed confidence 
that this is the correct line. And we will hold firm to this line." 
The president said that "the political situation in the country now is 
calm" and emphasized the importance of the coming elections to the State 
Duma. 

*******

#9
Berezovskiy Urges Capitalists To Play Open Politics 

MOSCOW, July 13 (Itar-Tass) - Russian oil-to-media 
tycoon Boris Berezovsky said on Tuesday his decision to run for the State 
Duma lower house in December's election was a call for capitalists to get 
out of the shade and play politics in the open. 

The decision is a "signal to the capital that it is time to come out to 
open positions and not be ashamed of being an owner," Berezovsky told 
Itar-Tass. "No one, except for us who have opened their own businesses by 
themselves, is able to run this country in the right way, in a way that 
would enable not only us, but also other people, to live normally," he said. 

"We cannot trust the running of this country to anyone else, we must do 
it ourselves. It does not matter whether you own a patch of land, a 
building or a factory -- that's not important. What is important is stop 
being ashamed of being a proprietor," Berezovsky went on to say. 

He said he would run for a single-member constituency, but had not 
picked the one so far. However, his single-member decision does not rule 
out alliance with political forces. 

"What I want is to run for a single-member constituency so that no one 
could say that I am hiding behind the backs of others," Berezovsky said. 

*******

#10
Daily Says Berezovsky Seeks Control Over Gazprom Money.

MOSCOW, July 15 (Itar-Tass) - A Russian influential daily said on Thursday 
that oil-to-media tycoon Boris Berezovsky and oil baron Roman Abramovich are 
working to get control over the financial flows of Russian Gazprom gas giant 
and the announcement of an extraordinary general meeting of the company 
shareholders is a proof to that. 

"An evident fact cannot be rejected: Roman Abramovich and his partner Boris 
Berezovsky (both are rumoured to be Grey Cardinals of the Kremlin) are more 
actively working to gain control over the gas monopoly", the Kommersant 
newspaper said on Thursday. 

The regular annual general assembly of shareholders of Gazprom was held on 
June 30, but its results did not suit Fuel and Energy Minister Viktor 
Kalyuzhny, who, according to Kommersant, is a man of First Deputy Prime 
Minister Nikolai Aksenenko. The latter, in his turn, is considered to be the 
man of Abramovich, the daily said. 

The assembly "failed to undermine the positions of /Gazprom chief executive 
officer/ Rem Vyakhirev, Kommersant said adding that it also did not include 
Kalyuzhny into the Board of Directors as Prime Minister Sergei Stepashin "had 
all grounds to fear the strengthening of the influence of the man of 
Abramovich". 

The assembly, however, elected ex-premier Viktor Chernomyrdin as the chairman 
of the Board of Directors. But "the government and the presidential 
administration now fear that Chernomyrdin will not be able to take an 
absolutely objective stance towards his old friend and colleague Rem 
Vyakhirev and the financial flows of the concern will be out of control of 
authorities on the eve of elections", the daily said. 

As a result, the Property ministry, which manages the state-owned shares in 
Gazprom, insisted on a new general assembly, which is likely to be held 
before September 5. 

At present the Gazprom Board of Directors includes seven supporters of 
Vyakhirev and four representatives of the state, including Chernomyrdin. "The 
government would like a correlation of 5 to 6", the Kommersant said. 

"It is clear that the fight of Abramovich-Berezovsky for Gazprom is going on 
in all directions", Kommersant said and recalled that Berezovsky-controlled 
ORT television had recently aired a Gazprom discrediting story. 

*******

#11
The Economist
July 17-23, 1999
[for personal use only]
Manipulating Russia's press
Ministry of gloom 
M O S C O W 
Rupert Berezovsky? 

EVEN at the best of times, press freedom in democratic Russia was a sickly 
plant. Now the leaves are yellow and shrivelling. The reason is the impending 
elections, for parliament in December and the presidency next summer, which 
journalists in happier countries would see as a treat, not a threat. 
One menace comes from the government, which has just set up a new press 
ministry with the sinister-sounding task, according to the prime minister, 
Sergei Stepashin, of “consolidating” the government’s “ideological work”. Few 
doubt that the new ministry’s job is to savage President Boris Yeltsin’s 
opponents, such as the Communist Party and Yuri Luzhkov, the mayor of Moscow 
and a presidential candidate. 

The state’s efforts coincide with those of Boris Berezovsky, a powerful 
tycoon with cosy ties to Mr Yeltsin’s family. He already controls the main 
television channel, ORT, and one daily newspaper. Now he has bought a 15% 
share in the country’s only remaining serious independent daily, Kommersant. 
Another potential casualty is a television channel, NTV, owned by Vladimir 
Gusinsky, another of Russia’s “oligarchs”, as its politically powerful 
tycoons are known; but its news coverage has been good. NTV is in financial 
trouble, with big debts to Gazprom, the mainly state-owned gas company. 

In the 1996 presidential election, the government needed less muscle. The 
media were readier to praise Mr Yeltsin (forgetting the war in Chechnya) and 
blacken his Communist opponent, Gennady Zyuganov. But keeping the Communists 
out was a fairly simple choice. Backing one tycoon’s dodgy candidate against 
another is more complicated. The editor of Kommersant says he will resign if 
he detects any editorial interference from the new owners. Many of his 
journalists are already looking for new employers (such as Vedomosti, a 
business daily to be launched later this year, whose backers include the 
Financial Times, part-owner of The Economist). 

Simply corralling the media behind the official line will therefore be 
difficult; Russia’s astute, cynical viewers and readers would notice. 
Instead, the pressure will mostly be subtler: encouraging self-censorship, 
promoting the compliant, sidelining the prickly. But there are more direct 
means. 

One is to put financial pressure on editors, for example by rejigging the 
rules about television advertising, already one of the most corrupt and 
politicised businesses in Russia. The other is to manipulate the flow of 
compromising material. One early sign was the removal of an investigative 
television programme, Sovershenno sekretno (Top Secret). Ominously, the new 
press minister, Mikhail Lesin, was previously a senior figure at RTR, the 
television station which early this year derailed an investigation into 
Kremlin corruption by the state prosecutor, Yuri Skuratov, by airing lengthy 
footage of him purportedly frolicking with two prostitutes. 

Even after the elections, there is unlikely to be much change. The problem 
for Russian journalists is that most of their compatriots are too poor to 
interest advertisers, and thus to pay for good news coverage. This makes the 
media a cheap plaything for the rich and powerful. Prostitution or 
bankruptcy: a dismal choice for a conscientious editor. 

*******

#12
Russian Jews shocked by synagogue stabbing

MOSCOW, July 15 (AFP) - Russian Jews were in a state of shock Thursday over 
the stabbing this week of a community leader in a Moscow synagogue and said 
the attack confirmed a rise in anti-Semitism in the country.

Police and private guards were posted at the entrances to the Choral 
Synagogue in Moscow's Kitai Gorod area in the wake of the attack Tuesday on 
the deputy director of a Jewish arts center, Leopold Kaymovsky.

Blood stains could still be seen on the floor of the synagogue, Moscow's most 
prominent, where Kaymovsky struggled against the assailant, a 20-year old law 
student who denounced a "Russian genocide being carried out by Jews."

Guards at the synagogue arrested Nikita Krivchun who was carrying three 
knives and had a swastika tattooed on his chest. 

The attack was the worst incident of anti-Semitic violence in post-Soviet 
Russia, according to Jewish leaders who added it was nevertheless not 
unexpected.

"It's not a surprise," said Tancred Golenpolsky, a member of the Russian 
Jewish Congress. "We warned the government that this was going to happen.

"It was absolutely natural that this would happen because the government is 
doing nothing against anti-Semitism," said Golenpolsky, founder of the 
largest Jewish newspaper in Russia, the Jewish Gazette.

Kaymovsky remained in serious condition in hospital Thursday, breathing with 
the aide of a respirator, but doctors were optimistic about his recovery, 
officials at the arts center said.

Chief rabbi Adolf Shayevich, who said the incident showed how weak the 
Russian state had become, met Thursday with Moscow police to discuss beefing 
up security at Moscow's six synagogues.

"We have today a climate that is conducive to this kind of event," said 
Shayevich.

The rabbi acknowledged that anti-Semitic statements from politicians may have 
fueled Russian prejudice against Jews who number 200,000 in Moscow and close 
to one million nationwide.

Communist General Albert Makashov, a member of the State Duma lower house of 
parliament, on October 4 vowed to "send Jews to the next world" at a meeting 
of his supporters.

Fellow party member Viktor Ilyukhin last year complained that Russian 
President Boris Yeltsin had "too many Jews" in his entourage and proposed 
that limits be imposed on the number of Jews promoted to top positions.

Makashov's statements were firmly rebuked by the Kremlin, which ordered an 
investigation but a resolution in the State Duma condemning the remarks 
failed to pass, garnering less than a quarter of voters in the legislature. 

Makashov never faced charges for his statements.

Moscow leaders spoke out Thursday against extremism and denounced the attack 
against the Jewish leader but the Kremlin remained tight-lipped.

The Moscow city council and the Otechestvo (Fatherland) party of Mayor Yury 
Luzkhov joined Patriarch Alexy II of the Orthodox Church who raised his voice 
against anti-Semitism on Wednesday.

The Komsomolskaya Pravda newspaper asked "Jewish pogroms in Moscow?" in an 
article which proclaimed that Tuesday's stabbing was "bound to happen." 

In an interview to NTV television, Krivchun declared that he "loved all 
religions except that of Jews and Satan.

"I did not want to kill him. I have nothing against him personally," he said. 

"It was a political act against the system. I wanted to show how I feel 
against Jews and draw attention to the problem of the Russian genocide being 
carried out by Jews," he said.

Jewish leaders said the attack could well unleash a new wave of immigration 
of Russian Jews to Israel.

The US State Department on Wednesday also condemned the anti-Semitic attack, 
calling it a cowardly act of terrorism. 

*******

#13
Russian Support for Compatriots Abroad Planned 

Rossiyskaya Gazeta
10 July 1999
[translation for personal use only]
Report by Vladimir Kucherenko under the rubric "In the Russian 
Federation Government": "In Order To Force People To Respect Us" 

At yesterday's sitting of the country's government, 
the main issue was the adoption of a federal targeted program of 
humanitarian cooperation with the CIS and Baltic countries. 

In fact, the discussion of the question developed into a search for 
ways of supporting our compatriots in new countries. According to 
Vyacheslav Mikhaylov, minister for Federation and nationalities affairs, 
Russian schools in the CIS and the Baltic have not been receiving text 
books or primers for six years now. The network of Russian schools is 
constantly diminishing. Russian culture is being pushed out, and 
furthermore, foreign states and organizations actively send the children 
of resident elites away to be educated in their countries. The education 
of citizens of neighboring countries in an anti-Russian spirit is 
becoming firmly established. 

We cannot accept this any longer. Back at the end of 1997 the president 
gave instructions to elaborate a special targeted program whose first 
stage will involve giving support to 25 million Russians outside the 
Russian Federation. Many state structures, and first and foremost V. 
Mihaylov's department, the Foreign Ministry (as regards the Russians' 
position in the Baltic countries), and the Ministry for CIS Affairs will 
take part in implementing it. The need to work with Russian communities 
on the territory of the national republics within Russia itself has been 
specially noted. Unfortunately, the resources for this program are 
extremely restricted. 

Premier Sergey Stepashin has reacted very seriously to this issue. According 
to him, it is impermissible that there is discrimination against Russians 
in Latvia, since Russians liberated this land from the Nazis and 
constructed modern Latvian industry. Let us note that the sitting 
discussed the law on the state language, adopted by the Latvian Saeima a 
few days ago, which turns Russians into second-class citizens once and for 
all. 

Sergey Stepashin believes that Russia and its Foreign Ministry should react 
more sharply to discrimination against our compatriots. 

The program was approved as a whole, and the premier instructed that 
sittings of the government commission for humanitarian cooperation with 
CIS and Baltic countries should be held at least once every quarter. 
Then Sergey Kalashnikov, minister of labor and social development, 
presented the draft law "On the Fundamentals of the Pension System in the 
Russian Federation." The government for the most part approved the 
document, deciding to put the finishing touches on it by 15 August, 
before the final version is submitted to the parliament. 

*******

#14
Moscow Times
July 15, 1999 
The Kremlin's Options 
By Sergei Markov 
Sergei Markov is director of the Institute of Political Studies. He 
contributed this comment to The Moscow Times. 

Boris Yeltsin has entered the final year of his second term. Although the 
Constitutional Court has already declared that he cannot run for a third 
term, the possibility remains that a constitutional transfer of power from 
Yeltsin to a successor might be violated. 

This is connected to several circumstances. First, a majority of Russians 
view Yeltsin's tenure as extremely unsuccessful. And if the political 
situation develops in an inauspicious manner for Yeltsin, his tenure may 
start to be viewed as catastrophic or even criminal. This, in turn, could 
lead to political accusations against Yeltsin and his inner circle so serious 
that the accusers would demand serious forms of punishment. Naturally Yeltsin 
and his entourage are trying to use the time they have left in power to 
secure their future. From this point of view, it is critically important for 
them to not allow a politician whom they don't sufficiently trust to be 
elected to the state's highest post. 

Second, corruption has blossomed during Yeltsin's tenure. It is highly likely 
that this corruption has also concerned the president's family. Thus there is 
the possibility that corruption charges could be brought against members of 
Yeltsin's family, leading to their arrest and conviction. 

Third, Yeltsin is known as a politician with an all-consuming love of power - 
as a powerful fighter who is not afraid of battles, and who has won 
practically all of those he has entered. Given Yeltsin's psychological 
make-up, many observers predict he will take decisive steps to retain power 
after 2000. 

Yeltsin has several possible strategies. One is the postponement or 
cancellation of the elections. Mass disorders could serve as the pretext, and 
could be provoked by a confrontation between Yeltsin and his Communist 
opponents or by the situation in the North Caucasus, which at any moment 
could explode into terrorism. Another possibility is that the presidential 
election results could be annulled, citing low turnout or massive 
infractions. 

However, I will risk predicting that this will not happen. Yeltsin has more 
then once declared that the vote must be carried out and expressed loyalty to 
the existing Constitution, which he considers his own. Yeltsin also wants to 
go down in history as the politician who paved the way for democracy. 
Cancelling the elections would undermine his place in history and - very 
importantly - his own self-image as a democratic. 

A majority of observers see a third scenario, involving Russia's unification 
with Belarus, as highly likely. It can be called the "Milosevic variant." 
After Slobodan Milosevic finished his second term as Serbian president, he 
was elected president of the Yugoslav Federation, and made sure most of the 
real power was transferred from the Serbian level to the Yugoslav level. 
Yeltsin might do something similar. 

I believe, however, that the maximum that Yeltsin will be able to do might be 
called the "Pinochet variant." General Augusto Pinochet lost Chile's 
elections and stepped down to make way for a new president. However, 
justifiably fearing punishment for crimes committed duringhis rule, Pinochet 
remained commander-in-chief of the Chilean armed forces, which gave him 
immunity from legal prosecution in Chile. Yeltsin could initiate a merger of 
the Russian and Belarussian armies and give the post of Russia-Belarus union 
president not all-embracing power, but simply the power of the union's armed 
forces' supreme commander. This would be more than enough to secure Yeltsin 
and members of his family against any possible political charges in the near 
future. 

A fourth variant would be for Yeltsin to make a loyal member of his inner 
circle his successor. This variant would require politically and materially 
isolating the main rival presidential aspirants - meaning Communist leader 
Gennady Zyuganov and Moscow Mayor Yury Luzhkov. Thus the Kremlin will try to 
break off as many of the Communists' allies as possible and may initiate 
multiple checks of the Communists by the Justice Ministry. It could also try 
to provoke the Communists by removing Lenin's body from Red Square and 
reburying it. Were the Communists to react with mass civil disobedience, this 
could create the pretext for banning the party. If they did not resist 
Lenin's removal, they would lose a significant part of their electorate. 

The Kremlin's attack on Luzhkov will include using various 
financial-budgetary levers to make his situation in Moscow more difficult, 
threatening the capital's image as Russia's showcase. However it is doubtful 
the Kremlin will take too decisive steps in this direction, because 
increasing social tension in Moscow would create problems for the party of 
power itself. Another likely line of attack will be an attempt to isolate 
Luzhkov from the political and economic elite, above all the governors. The 
Kremlin is already pressuring the various gubernatorial electoral blocs, 
particularly All Russia, not to ally with Luzhkov's Fatherland for the 
parliamentary elections. It is also trying to form a centrist coalition that 
will be an alternative to Fatherland. 

Thus, the basic directions of the Kremlin's political activity are likely to 
be continuing the process of uniting with Belarus, but according to the 
"Pinochet" and not the "Milosevic" variant; continuing and increasing 
pressure on the Communists, possibly up to and including a ban on the party; 
fighting for control over the country's main mass media and financial flows 
in order to support its chosen candidate and limit its rivals, above all 
Luzhkov; and to take control of the process of forming electoral blocs. 

********

#15
Accused Russian Nuclear ''Spy' Faces New Problems

ST PETERSBURG, Russia, July 15 (Reuters) - A former Russian naval captain 
accused of treason and espionage said on Thursday his lawyers were having 
problems preparing his case because of new secrecy restrictions. 

Alexander Nikitin, who accused the Russian navy of dumping nuclear waste in 
the Arctic Sea, and one of his lawyers said Russian authorities had re-issued 
charges against him and had complicated matters by saying they were covered 
by secrecy laws. 

"For the first time in the nearly four years of the investigation we have 
been presented with a 'secret' charge," Nikitin told a news conference in his 
home city of St Petersburg. 

"We do not have the right to lay hands on this charge, we do not have the 
right to take it out of the FSB (Federal Security Service) building and we do 
not have the right to work with it because it has 'secret' stamped on it. So 
everything that was not secret before is now secret." 

His lawyer, Yuri Schmidt, explained that the FSB had presented the same 
charges as earlier in the case -- treason and espionage -- but had based 
their case on evidence or documents covered by state secrecy laws. 

Nikitin was arrested in February 1996 and accused of revealing state secrets 
when he wrote a report for Norwegian environmental group Bellona on 
radioactive pollution by Russia's Northern Fleet. 

The Supreme Court last February rejected an appeal to drop the charges and 
gave the FSB more time to produce evidence. Human rights organisations and 
Nikitin's supporters say Russia is trying simply to hush up his embarrassing 
revelations. 

Nikitin was initially held in jail but was released on condition that he 
remain in Russia. He is still awaiting trial. 

The FSB said in a statement it saw no reason to drop the charges against 
Nikitin. 

"Experts have again confirmed that the facts handed over to foreign 
organisations are a state secret and could not be obtained by them from open 
sources," the St Petersburg branch of the FSB said. 

*******