August 3, 1999   
This Date's Issues: 3418 • 3419   • 

Johnson's Russia List
#3419
3 August 1999
davidjohnson@erols.com

[Note from David Johnson:
1. Washington Post: Geneva Overholser, Kennan's Counsel.
2. Reuters: Raisa Gorbachev reported seriously ill in Germany.
3. Reuters: Peter Graff, Ten years on, where are Russia's democrats?
4. Itar-Tass: Govt Likely to Step up Pressure on Duma to Ratify Start-2.
5. RFE/RL: Floriana Fossato, Political Parties Rush To Air TV Ads Before 
Elections.
6. Itar-Tass: Media To Allot Free Airtime During Election Campaign.
7. Moscow Times: Leonid Bershidsky, FIFTH COLUMN: English Adds Spice to 
New Russian Novel.
8. Boston Globe: Stephen Kurkjian, Illegal business visa use seen as 
extensive. Dummy firms got workers from ex-Soviet states.
9. Obshchaya Gazeta: Luzhkov on Moscow Money Sources.
10. Rossiyskaya Gazeta: Government To Curtail Federal Programs.
11. RFE/RL: Ben Partridge, Caucasus/Central Asia: Study Considers 
Western Influence 'Mixed' Success.]

*******

#1
Washington Post
3 August 1999
[for personal use only]
Kennan's Counsel
By Geneva Overholser

And now, with a much-needed word about humility, comes one of the nation's
wisest old men, George F. Kennan -- scholar, historian, diplomat, statesman.

Kennan's counsel, in the current New York Review of Books, flies in the
face of our current habit of sounding -- to friends and adversaries alike
-- like schoolyard braggarts. "The indispensable nation," our president and
secretary of state call us, assisting us in our ongoing national pat on the
back.

In an interview with Princeton's Richard Ullman, the 95-year-old Kennan --
former ambassador to Russia and Yugoslavia -- recommends some stocktaking.
"What we ought to do at this point is to try to cut ourselves down to size
in the dreams and aspirations we direct to our possibilities for world
leadership.

"We are not, really, all that great. We have serious problems within our
society these days, and it sometimes seems to me that the best help we
could give to others would be to allow them to observe that we are now
confronting those problems with a bit more imagination, courage, and
resolve than has been apparent in the recent past."

The gift for seeing ourselves as others see us is not the first trait that
others associate with Americans. Take the fact that we are confident these
days that we're seen by all as the benign superpower. On the contrary,
Harvard's Samuel Huntington warned in a recent issue of Foreign Affairs,
elites in countries representing two-thirds of the world's population --
Chinese, Russians, Indians, Arabs, Muslims and Africans -- see us as "the
single greatest external threat to their societies." Not a military but a
political and cultural threat -- intrusive, interventionist, hegemonic,
hypocritical, engaging in "financial imperialism" and "intellectual
colonialism."

One antidote for our lack of self-awareness is reading portrayals of us
from abroad -- as in the "international papers" feature of the online
magazine, Slate. An example is this mid-July editorial from the Straits
Times of Singapore, urging greater understanding of Russia's plight:

"Russia means to be taken seriously, and the U.S. owes it that respect.
American cockiness over its display of military technology in the Gulf and
Yugoslavia, and smugness over its longest postwar prosperity streak, can
blind it to a need to cultivate its relations with Russia beyond promoting
democratization. Russians cannot eat democracy. The U.S. should snap out of
its hubris over Kosovo -- or the world could become very dark indeed if
Russian hurt turns to mischief-making."

A second antidote is to listen to wise old men such as Kennan. "This whole
tendency to see ourselves as the center of political enlightenment and as
teachers to a great part of the rest of the world strikes me as
unthought-through, vainglorious and undesirable. If you think that our life
here at home has meritorious aspects worthy of emulation by peoples
elsewhere, the best way to recommend them is, as John Quincy Adams
maintained, not by preaching at others but by the force of example," he
says in the New York Review.

I first heard Kennan 15 years ago, on the eve of his 80th birthday. He and
his wife had traveled by train from Princeton to Grinnell, Iowa, to speak
at Grinnell College. Then, as now, he advised "a greater humility in our
national outlook. . . . We must bear in mind that in interaction of
peoples, as with individuals, the power of example is far greater than the
power of precept."

Grinnell students, impressed with the courtly, soft-spoken man with a
clipped mustache and statesmanlike demeanor, took to calling Kennan "St.
George." But this saint would not appeal to the soft of heart. He is a very
clearheaded pragmatist -- a type we see too little of in public life today.

"I would urge a far greater detachment, on our government's part, from
[other nations'] domestic affairs," he told Ullman. Comparing China to
France, Kennan said both are proud bearers of a great cultural tradition,
and both like to be left alone. We should treat the Chinese "with the most
exquisite courtesy and respect on the official level, but not expect too
much of them. . . . They are not going to love us, no matter what we do.
They are not going to become like us."

National humility, a foreign policy that respects our own limits and rests
on a deeper understanding of friends and adversaries: Kennan has long
counseled such a course. Now -- as the Russian prime minister visits
Washington, Congress debates trade relations with China, and our nominee
for ambassador to the United Nations remains stuck in the Senate -- would
be a very good time to listen. 

*******

#2
Raisa Gorbachev reported seriously ill in Germany

MOSCOW, Aug 3 (Reuters) - Raisa Gorbachev, 67-year-old wife of former
Soviet President Mikhail Gorbachev, is seriously ill and is being treated
in Germany where her husband is by her side, Gorbachev's spokesman said on
Tuesday. 

``The illness is serious,'' Pavel Palazchenko, a long-time Gorbachev
translator and adviser, told Reuters. ``We are hoping that this will be
cured, absolutely, and this is what the doctors are saying.'' 

The official said Raisa Gorbachev travelled to the German city of Muenster
a few days ago for medical tests and treatment. 

``A leading specialist from Muenster was brought in at their request for a
consulation in Moscow, and in consultation with the Russian doctors they
decided the best way would be to take the patient to Germany where that
doctor practices,'' he said. 

He said he could not identify her illness, but said the doctor was an
internal medicine specialist. 

Russian media quoted Mikhail Gorbachev as saying: ``She has a serious blood
disorder.'' 

The hospital in Muenster confirmed that Raisa Gorbachev was a patient there
but declined to give details of her condition. 

``I can confirm that Mrs Gorbachev is here for an examination in the
clinic,'' the administrative director of Muenster's University Hospital
Manfred Gotthardt told Reuters. 

The 67-year-old former Moscow philosophy professor, who married Mikhail
Gorbachev in 1956, arrived for treatment at the 1,600 bed hospital on
Monday, Gotthardt said. 

Known for bringing a sense of style lacking in previous Kremlin wives,
Raisa Gorbachev has kept a low profile since her husband left office in 1991. 

Palazchenko said she had accompanied her husband on many of his foreign
lecture trips and that she makes public appearances. Most recently, they
made a two-week trip to Australia ending in June. 

Raisa Gorbachev became ill in 1991 after spending several days under guard
with her husband during a hardline Communist coup. Palazchenko said that
illness was unrelated to her current condition. 

*******

#3
Ten years on, where are Russia's democrats?
By Peter Graff

MOSCOW, Aug 3 (Reuters) - ``What we have seen here is a demonstration of
how the democratic consciousness of our people has come of age!'' 

The speaker was Boris Yeltsin, a former regional Communist Party boss
turned hero of the people. The speech heralded the arrival of the first
organised political force to challenge seven decades of Communist rule. 

As the 10th anniversary of the establishment of the so-called
Inter-regional Group of reform minded Soviet politicians passed last week,
some of Yeltsin's former allies wondered what had happened to the idealism
of those days. 

Ten years ago, Yeltsin was larger than life. The Washington Post would
write a month after that speech that his voice ``could shatter dishes.'' 

It was a time thick with history across the globe. The Berlin Wall was
about to fall in Germany; Chinese troops had just crushed the protest
movement in Beijing's Tiananmen Square. 

In Mikhail Gorbachev's Soviet Union, it was the year of the first Congress
of Peoples' Deputies, a grand political opera whose televised instalments
transformed the nation forever. 

At the end of July an ad hoc group of deputies gathered in a cinema and
announced that they would join together to press for democratic change. 

Today, the Soviet Union is long gone and the face of Russia is changed
beyond all recognition. 

But many of those who fought for change say the new Russia -- corrupt and
violent, traumatised by ethnic warfare, most of its population impoverished
while a handful of insiders grew staggeringly rich -- was not what they had
in mind. 

VICTORY AND DEFEAT 

``Of course nobody in 1989 could have dreamt of the victory that
followed...that in two years the Communist Party would have given up its
power,'' said Andrei Piontkovsky, a liberal political analyst at the Centre
for Strategic Studies in Moscow. 

``But the great defeat was that bandit capitalism was set up in this
country. They could hardly have considered their goal to be the foundation
of the socio-economic system in place in Russia today.'' 

The announcement in the summer of 1989 that some deputies planned to unite
to criticise the party line was a bold step. 

Formal opposition to the Soviet Communist party had been outlawed since the
days of Lenin, and the deputies didn't dare call themselves a ``party,'' or
even a ``faction.'' Instead, they chose the deliberately prosaic title
``Inter-regional Group.'' 

But the significance of the move was lost on no one. 

``It was not just a significant event. It was a fundamental event. It was,
in fact, the first opposition political party,'' said Piontkovsky. 

``All the parties that exist in Russia now owe their roots, in effect, to
the Inter-regional Group...To the extent that there is democracy in Russia,
this is an achievement of the Inter-regional Group. 

``But they had little impact on the shape of what followed.'' 

AN UNEASY ALLIANCE 

Many former dissidents and veterans of the early democratic movement trace
their disillusionment to their alliance with Yeltsin, who despite a hearty
populist instinct that pulled him toward democratic reforms, was never one
of their own. 

Hundreds of politicians hitched their fates to the Inter-regional Group,
but two giants towered over the rest: Yeltsin and Andrei Sakharov, the
Nobel Peace Prize-winning physicist who had led the dissident movement for
decades. 

Sakharov would die of a sudden heart attack six months after the group was
founded. His funeral was attended by 100,000 mourners and he was revered as
the national conscience. 

But Yeltsin would go on to inherit the uncontested leadership of the reform
movement, and eventually become Russia's first democratically elected leader. 

His relationship with the intellectuals who backed him in those early years
would always be an uneasy one, and would finally end in disillusionment
after the horrors of the war in Chechnya, which most democrats staunchly
opposed. 

But in the early days, said Piontkovsky, the intellectuals and Yeltsin each
needed each other. 

``Yeltsin was fighting for his political career. Without the Inter-regional
Group he could have been sent off to be ambassador to Zimbabwe or
something,'' said Piontkovsky. 

``But the intellectuals also needed Yeltsin. Without him, their grand ideas
would have gotten little further than kitchen table chat.'' 

AN EAGER PUPIL 

Oleg Poptsov, a journalist and close Yeltsin ally of the period, recalls
that Yeltsin was an eager pupil of the movement's urbane intellectuals. 

``When he became its leader, the Inter-regional Group did a lot for
Yeltsin,'' he said. 

``I would say it educated him. It surrounded him, nurtured him with
intellectual fat, which he had never had. He was a construction worker by
training. He was a straightforward person, a tough person. Absolutely
party-bred.'' 

Poptsov, who went on to head Russia's pro-Yeltsin state television station
RTR, would learn about the president's straightforwardness the hard way
during the Chechen war. 

Yeltsin sacked him suddenly. He said he was sick and tired of RTR showing
``corpses here, corpses there.'' 

Still, Poptsov said the dissidents were able to instil some values in the
man who would lead the country. 

``He learned some things. Like freedom of speech. He really was committed
to that most of the time.'' 

But Sakharov's widow, Yelena Bonner, said the democrats should have been
suspicious of the populist hero earlier on. Instead, their close
association with Yeltsin only discredited them in the eyes of many Russian
voters. 

``I could see it right from the beginning,'' she told Reuters. 

``The arrival of Yeltsin and the people close to him was basically an open
struggle for power. 

``The majority of those people, for all their ideological aspirations, lied
to the country. And that lie itself was not as dangerous as its
consequence: disillusionment with democratic values among the whole
population,'' she said. 

Still, when historians have a chance to look back coolly on the legacy of
the early pro-democracy movement, they will probably conclude that the
improbable alliance between the burly regional party chief and the
idealistic dissidents was not a complete waste. 

``That I am able to discuss such matters on the phone with a foreign
correspondent, this is surely a sign of some progress, after all, isn't
it?,'' Piontkovsky said. 

*******

#4
Govt Likely to Step up Pressure on Duma to Ratify Start-2.

MOSCOW, August 2 (Itar-Tass) - The Russian government is likely to step up 
its efforts to convince the State Duma to ratify the START-2 treaty in the 
autumn, Duma Foreign Affairs Committee chairman Vladimir Lukin said. 

Lukin told Itar-Tass on Monday that this issue has been "actively discussed 
lately during the talks between Russian Prime Minister Sergei Stepashin and 
(U.S. Vice-President) Al Gore, at the Cologne summit and in Sarajevo." 

"But there very little chance that it will be ratified before January of next 
year," he added. 

He explained that the incumbent Duma is "preoccupied with the upcoming 
elections to the lower house of parliament.... This is why the left-wing 
majority in the Duma, while understanding that the treaty has to be ratified, 
is unlikely to do it now because it has spent so much time explaining to its 
electorate that its ratification will be a betrayal." 

Lukin stressed that the treaty should be ratified only when all questions 
concerning anti-missile defence systems are worked out. 

"The Americans have decided to create a national anti-missile defence system 
and Russia should understand very clearly what this means, what problems it 
may face because of this and how they can be solved in the START-3 treaty," 
he said. 

Lukin believes that the question of START-2 ratification may be included in 
the agenda of the new State Duma in January. He thinks the new Duma will 
"deal with problems in a more rational way, including with the ratification 
of such important treaties as START-2, because the next parliamentary 
elections will be far away." 

*******

#5
Russia: Political Parties Rush To Air TV Ads Before Elections
By Floriana Fossato

Russia's political and business factions have already started airing 
political advertisements on television, even though the polls are still 
months away. NCA Moscow correspondent Floriana Fossato reports that the 
Central Electoral Commission has begun examining the issue and its 
consequences. 

Moscow, 2 August 1999 (RFE/RL) -- Russia's political factions have already 
begun to air thinly disguised campaign ads on television and to tighten their 
control over media outlets ahead of the country's upcoming parliamentary and 
presidential elections.

The campaign fever might seem odd given the fact that the parliamentary 
elections are not scheduled until December and the presidential vote won't 
happen until mid-2000. The list of presidential hopefuls hasn't even been 
decided and it's not yet clear whether the ads conform to Russian campaign 
laws.

The ads began in May, when NTV, TV6, ORT (partially state-controlled) and RTR 
(fully state-controlled) started broadcasting five different ads featuring 
nationalist leader Vladimir Zhirinovsky. NTV and TV6, controlled by Kremlin 
insider Boris Berezovsky, have continued broadcasting ads.

The groups and parties have good reason to advertise early: president Boris 
Yeltsin can announce the start of the parliamentary campaign any time until 
August 19, and in the absence of well-established political parties and 
grass-roots organizations, the control of electronic and print media remains 
crucial.

Russian media analysts contend the early advertisements don't count as overt 
campaign ads since they don't make a direct appeal to voters. They say the 
ads are simply an early attempt to win voter recognition and, as such, don't 
violate campaign laws or norms.

That seemed to be the opinion of Russia's Central Electoral Commission (CEC), 
which didn't pay much attention to the ads at first.

But last month the CEC met to consider the issue. CEC Chairman Aleksandr 
Veshnyakov later met with the heads of the top television channels to ask 
that they avoid broadcasting political ads until the official start of the 
campaign. 

The rush to advertise has political observers concerned. Iulyi Nisnevich, the 
head of the Center for Legislative and Parliamentary Activity, an independent 
watchdog, says early advertising deprives the electorate of objective 
information.

Nisnevich says existing legislation does not deal with political advertising. 
He adds that a special law is needed.

In the absence of such a law, Nisnevich is concerned about the consequences 
of the early advertising:

"We are witnessing, in my opinion, a serious phenomenon that can have serious 
consequences. I would call it a form of pre-electoral information extremism. 
Moral, professional and ethical norms are being violated. This is obvious. 
The main point is that, to a certain extent, we have started seeing 
violations of the [electoral] legislation. [People] may stop believing in the 
information they receive from television and the print media and this can 
undermine the foundation of democratic society. Can television stations be 
considered independent if they defend only their own interests and depend on 
financial backers for support? A careful analysis of the current situation 
shows their links to propaganda campaigns."

Veshnyakov agrees and says new legal guidelines to the existing electoral law 
would help clarify the situation. He says the electoral law now stipulates 
that state-owned media and media organizations receiving more than 15 percent 
of their budgets from state funds are supposed to guarantee "equal 
conditions" to all candidates during the parliamentary campaign.

Top television executives say they expect to receive offers of 
free-of-charge, already-made programs, as well as money, for the television 
appearance of various politicians. 

********

#6
Media To Allot Free Airtime During Election Campaign 

MOSCOW, July 30 (Itar-Tass) - The Ministry for 
Press, TV and Radio Broadcasting and Mass Communication, together with 
the Central Electoral Commission, will make a list of TV and radio 
broadcasting companies, as well as publications, which will be obliged to 
give free time and printing space for propaganda materials during the 
coming electoral campaign, Chairman of the Central Electoral Commission 
Alexander Veshnyakov told journalists on Friday. 

He had a meeting with Minister for Press, TV and Radio Broadcasting and 
Mass Communication Mikhail Lesin on Friday. They discussed the problem of 
the work of mass media organs during the forthcoming electoral campaign. 

"The list will be published, so that all participants in the electoral 
campaign will known whom they can count on," Veshnyakov said. 

Lesin said that their ministry would draw up corresponding methodological 
recommendations within three weeks, which would include Internet. 

*******

#7
Moscow Times
August 3, 1999 
FIFTH COLUMN: English Adds Spice to New Russian Novel 
By Leonid Bershidsky 

Russian literature has always looked to the West for spice and often for 
clarity. In the 19th century, certain things were best said in French. 

Besides, when French was the Russian nobility's lingua franca, authors had to 
use it to make dialogue sound realistic. 

These days, of course, English is everywhere. If a large part of your 
readership consists of internal emigrĪs, you have to talk to them in their 
language. And internal emigrĪs, just like members of the middle class 
everywhere, are the most avid readers of quality literature. 

It is no accident, then, that perhaps the biggest Russian "quality" 
bestseller of 1999, the latest novel by Viktor Pelevin, even has a 
half-English title, "Generation P," where only the "P" is a Cyrillic letter. 

Even so, it stands for Pepsi in one of the possible meanings of the 
intentionally ambiguous title. 

The book comes complete with an epigraph from Leonard Cohen's album "The 
Future" and a bunch of newly-coined English-based terms, such as 
"Wow-Factor." In his novel, Pelevin develops an entire theory describing the 
way advertising affects the consumer. The "Wow-Factor" is the impulse in 
advertising that forces a consumer to say "Wow" and consume. Of course, "Wow" 
is something only an internal emigrĪ would say in Russia. 

Pelevin's highly fashionable book centers, in large part, on the vagaries of 
adapting the advertising of Western brands to the Russian consumer's 
perceptions. The main character in "generation P" is a copywriter, a 
kopiraiter, to be precise, since there is no Russian word for the trade. And 
generally, if you do not speak at least some English, you will miss a lot of 
very topical humor in the book. 

Pelevin has been experimenting with English for quite some time, probably as 
long as with psilocybin mushrooms. From story to story, novel to novel, his 
English keeps getting better, though he still has some trouble using the 
definite and indefinite articles in the right places. There is plenty of time 
for him to improve: He has a young cult following that is not going to die 
out anytime soon. 

In the not-so-distant future, English might be superceded by some other 
language as the fashionable non-Russian element in the literary hodgepodge. 
At least that is the way Vladimir Sorokin, the author of another list-topper, 
"Blue Fat," would have it. 

Sorokin, with his stylistic fireworks and libertarian literary approach to 
sex and drugs, is the Russian bohemian's author of choice. For this 
readership, English is not hip enough. Every culturally deficient kopiraiter 
speaks it. French is obsolete. German has limited aesthetic appeal. So in 
Blue Fat, Sorokin's characters, including Russians, speak a 21st-century 
version of Russian in which there is at least one Chinese word in every 
sentence. 

There is even a small Chinese glossary at the end of the book. The logic is 
that if the 20th century belonged to the United States, in the next 100 years 
China should get its shot at world economic, cultural and linguistic 
dominance. 

If this trend develops, subsequent bestsellers will speak to their readers in 
flowing Italian, musical Arabic and exotic Swahili. Plain Russian is just not 
enough anymore. No matter how beautifully you write it, it will not titillate 
the overfed audience the way foreign words never fail to do, whether you 
understand them or refer to Sorokin's glossary. 

*******

#8
Boston Globe
1 August 199
[for personal use only]
Illegal business visa use seen as extensive 
Dummy firms got workers from ex-Soviet states
By Stephen Kurkjian (KURKJI@globe.com)

ALBANY - For Alexandr U. Yegmenov, unlike many immigrants, ethnic affinity
had 
nothing to do with his decision to live in New York's capital city when he 
arrived seeking asylum from the former Soviet Union in the early 1990s. What 
drew Yegmenov here was a wholesale scheme to circumvent US immigration laws.

Over three years before he was caught in 1995, Yegmenov established an 
astonishing 4,000 dummy corporations at the New York Secretary of State's 
office and used them to help bring an estimated 750 to 1,000 residents of the 
fomer Soviet Union illegally into the country on business visas, many of them 
transplanted mobsters.

Yegmenov, whose exploits have never been made public, may be unique. But 
according to US officials and documents, he is but one entrepreneur in a 
thriving underworld that operates on two continents to produce fraudulent 
documents that have allowed thousands from the former Soviet Union to enter 
the United States illicitly on work visas. US officials estimate that up to 
70 percent of applications for business visas from the former Soviet Union 
are fraudulent.

In Massachusetts alone, federal officials point to three conspicuous cases 
that have alarmed law enforcement:

Three alleged hit men from Chechnya were destined for the United States in 
1994 with work visas arranged by a Falmouth company, Quartz Sales & Marketing 
Inc., which had business interests in the former Soviet Union. The FBI 
quashed the visas, however, after Lech Z. Morawiez, president of the company, 
received word that the three men, whom he presumed were engineers who would 
help him win contracts in their homeland, were actually thugs sent to harm 
Morawiez and his associates because a prior business deal had gone sour.

One of four Boston-area men reputed in congressional testimony to be members 
of the ''Russian mafia,'' sought a visa in 1993 for a Moscow man, contending 
that the visitor was going to work for his firm, American-Russian 
Enterprises, in Chestnut Hill.

Boris Sorkin of Brookline indicated in his application that Alimzhan 
Tokhtahounov would be helping him in his import-export business. However, 
federal authorities found that Tokhtahounov was a member of Moscow's criminal 
underground and associated with Vyacheslav Ivankov, a Russian mobster who was 
convicted of fraud in New York in 1995. The visa application was denied.

Zhalgas Amanbayev, a businessman from Kazakhstan, was arrested by the FBI in 
late December in Boston after paying an undercover agent $30,000 to purchase 
two green cards that would have allowed him and his brother to stay, and 
work, in the country indefinitely. After purchasing the cards, Amanbayev said 
he was interested in engaging in other criminal enterprises with the 
undercover agent. Before he was arrested, he showed he had the ability to 
launder $10 million in alleged drug proceeds through bank accounts in 
Kazakhstan, Latvia, Russia, and the Bahamas.

The visa fraud problem became severe enough that four years ago, the State 
Department established an antifraud force at the American Embassy in Moscow 
and assigned State Department and FBI investigators across the country the 
responsibility of tracking down illegal visa schemes.

In 1996, for example, the investigators reported they had stopped more than 
40 members of organized crime gangs from Russia and other former Soviet 
republics from moving to the United States, Europe, and Israel.

The State Department's Diplomatic Security Service is responsible for 
reviewing applications by more than 2,000 Russians and other former Soviet 
citizens annually for business visas that will grant them extended stays in 
the United States. To qualify, applicants must show that they are being 
sponsored by an American company that is affiliated with the firm for which 
they work in their homeland.

One State Department official, who asked not to be identified, estimated that 
about 70 percent of the applications filed annually for the visas contain a 
significant amount of fraud. In most cases, the official said, the applicants 
have no affiliation with the companies they contend are sponsoring them or 
the firms, like the paper companies created by Yegmenov, simply do not exist.

The latter proved to be the case last December when State Department 
investigators checked out a work visa application for several Russians who 
said they were employed by the Moscow affiliate of Star Freight Services in 
East Boston. The office address, 2 Neptune Road, turned out to be only a mail 
drop.

Those applying from the former Soviet Union are not alone in engaging in 
wide-scale fraud in business visas. In May, a US House committee heard 
testimony about significant fraud in visa applications from China, India, and 
Brazil, as well as Russia. However, the officials said the schemes devised by 
people from Russia and the other former Soviet republics are generally more 
sophisticated and the falsified documents more difficult to detect than 
elsewhere.

Still, the efforts of Alexandr Yegmenov in Albany to secure fraudulent visas 
for those from the former Soviet Union appear unrivaled. Born in Leningrad in 
1957, Yegmenov sought political asylum in 1990, asserting that he had been 
persecuted for his work as an economist for a dissident organization, and 
even placed in a psychiatric hospital for a month.

The Russian documents Yegmenov used to back up his claims turned out to be 
phony, drawn up by Yegmenov himself, according to the criminal case filed 
against him.

But that was the least of Yegmenov's crimes: Taking full advantage of 
American bureaucracy, Yegmenov created thousands of fictitious corporations 
in Albany, and hundreds of others in more than a dozen other states, 
including Massachusetts, in an elaborate scheme to bring Russians and others 
from the former Soviet Union to the United States, according to US and New 
York state investigators who worked on the case.

In reconstructing Yegmenov's activities, investigators learned he was 
charging Russian emigres as much as $5,000 each for drawing up the necessary 
documentation that facilitated their illegal entry into the United States.

What's more, investigators found ample evidence that millions of dollars 
worth of rubles were also smuggled from Russia to the United States through 
Yegmenov's corporations. Tracing the paths of those who got visas through 
Yegmenov, investigators found that they often deposited large amounts of 
money, in many cases hundreds of thousands of dollars each, in US banks.

''They were either bringing in enough money to establish a life here in the 
United States for themselves or moving money here for someone else,'' said 
Thomas D. O'Connell, the Immigration and Naturalization Service's lead 
investigator on the Yegmenov case. ''Whether it was money laundering or 
capital flight, this money had no business coming here.''

Many, like Aleksander Erokhov, had come with sizable financial means. With 
the application he filed in mid-1995, Erokhov, a native of St. Petersburg, 
submitted bank statements that showed he was transferring $316,900 to the 
United States. Before he was caught and deported, federal investigators said, 
Erokhov became associated with the largest Russian organized crime network in 
the United States, which operates out of the Brighton Beach neighborhood of 
Brooklyn.

Although Yegmenov, too, has been deported, investigators said they fear that 
many of the firms he incorporated are still being used to funnel workers into 
the United States.

''There is no way of knowing how many firms he actually incorporated, and 
which ones they are,'' said New York State Police Captain David L. McNulty of 
the Bureau of Criminal Investigations in Albany. ''So even though Yegmenov's 
been dealt with, we still don't know everyone who may have gotten here 
because of his fraud, or if they're still coming in.''

******

#9
Luzhkov on Moscow Money Sources 

Obshchaya Gazeta 
July 22-28, 1999
[translation for personal use only]
Interview with Moscow Mayor Yuriy Luzhkov by Natalya Grigoryeva; 
place and date not given: "Where the Capital City Gets the Money From: Me 
and the Last Seven Days" 

"Moscow's economic phenomenon gives rise in me not only 
admiration, but also great doubts. A Russian governor said recently 
that if he "had as much money as Luzhkov," he would have created 
paradise on earth in his region a long time ago." Dmitriy Nazarov, Perm. 
We turned for a comment to Yuriy Luzhkov, mayor of Moscow.

[Luzhkov] In Moscow, money does not fall from the sky. One 
must simply use the opportunities that a small-scale economy gives 
even in the present complicated conditions. It is necessary to 
support industry. In the capital, in a number of enterprises we have 
relinquished our part of the tax revenue. Through the Moscow 
department of industry we also help them purchase raw materials. We 
also assist them to adjust cooperation relations, through which an 
enterprise can manufacture production and sell it. 
There have been some results already (although they are not 
stunning). As compared with 1997, Moscow industry had a 108.2 
percent increase in 1998 (before 17 August, of course). This year, 
as compared with last year, had an increase of 100.4 percent. 
[Grigoryeva] Perhaps one cause of the Moscow "phenomenon" is 
that all funds from the federal budget go to Moscow? 
[Luzhkov] Tell me, which funds?! A well-known "agitator and 
propagandist" from the middle of the century remarked that deceit 
exerts the strongest influence on human beings. Not petty, but 
great, huge deceit. On hearing it, human beings are astonished. Then 
they think that it is all true in reality. "Moscow takes funds 
from the federal budget"--this is a myth. Moscow brings in 43 
percent of the entire revenue to the Russian budget, and gets 
nothing! If a human being cannot do something, he either says 
honestly: "I am incapable, it did not turn out." Or he explains his 
inaction by the fact that his neighbor has special resources or some 
secret source of financial means. 
[Grigoryeva] The idea has raced through some publications that 
the Moscow city authorities are experiencing a catastrophe with 
regard to money, which They are concealing from Muscovites. The 
numbers of the city budget are secret, and the public cannot control it. 
[Luzhkov] The city budget is published. The "public" can 
become acquainted with it. The Moscow City Duma and the Audit Office 
control it. The Duma passes the budget by paragraph. Each quarter, a 
report is presented on fulfillment of the budget. We cannot bring 
any changes into budget items without applying to the Duma. 
Incidentally, the other day we applied to the Moscow City Duma in 
order to increase the expenditure part of the budget, because our 
situation with the revenue part has improved. This is with regard to 
the question of a catastrophe, of a deficit. 
[Grigoryeva] You are criticized for building too much... 
[Luzhkov] Let them criticize, I am very satisfied. In our 
city, people are praised if they take out credits (it is true, not 
very successfully). People blame us for the building work being done 
in Moscow. The world has become absurd. 
[Grigoryeva] Maybe it was not worthwhile to rebuild the Christ 
the Savior Cathedral, but rather more necessary to spend these funds 
on the social sphere? 
[Luzhkov] The main thing here is to keep reasonable 
proportions: to build churches and housing. In Russia, nobody builds 
more housing than we do. Of course, I could have refused to build 
the Christ the Savior Cathedral and the New Opera Theater, on 
Manezhnaya Square, where formerly there was a gray asphalt blot. Now 
young people gather there round the clock. I could also have 
abstained from building the Gostiny Dvor mall, which we will 
complete this year. It would have been possible not to help the 
theater of Petr Fomenko and the branch of the Maly Theater--the 
theater on Ordynka Street, the Bolshoy Theater, and the Pushkin 
Museum, which is now one of the most well-organized literature 
research museums in the world. However, I am convinced that without 
the spiritual sphere, without the sphere of culture, we simply 
become representatives of the animal world. 
[Grigoryeva] All the same, in our country people think that 
"the post adorns the man, and not vice versa." Could you create the 
same good conditions in another town, say, in Kostroma? 
[Luzhkov] In Syzran. Susuyev wanted to send me to Syzran. I am 
not scared, after Moscow I will go there. You can develop small 
business in any town. Because small business is initiative. On the 
one hand, it is additional production, on the other, a human being 
takes responsibility for his fate and affluence. He removes this 
responsibility from the state. Some 800,000 enterprises have been 
registered in Russia, and 240,000 of them are located in Moscow. 
Small business contributes half of the budget in a developed country 
such as Germany. This is not a closely guarded secret. It is necessary to 
deal 
with this matter. If you do not deal with it, you lose possibilities 
for your region or your oblast to live better. 

*******

#10
Government To Curtail Federal Programs 

Rossiyskaya Gazeta
30 July 1999
[translation for personal use only]
"Russian Federation Government" report by Vladimir Kucherenko: "Less 
Is Better When It Actually Exists" 

What should be done about the 173 targeted federal 
programs for which there is desperately little finance? This problem was 
discussed yesterday [29 July] at a routine government session. Opening 
the session, Premier Sergey Stepashin touched upon an extremely urgent 
problem: the gasoline crisis. A group led by Fuel and Energy Ministry 
head Viktor Kalyuzhnyy is urgently flying out to Krasnodar Kray. It is to 
analyze the flow of petroleum products from oil production companies to 
refineries and thereafter to gas stations. As S. Stepashin stated, much 
now depends on the actions of the governors themselves with regard to 
licensing policy. 

"In those places where 90 percent of gas stations are in private hands 
they are closing down. On the other hand, in Yaroslavl Oblast, where the 
situation is completely different, there are no lines at gas pumps and 
the gas stations themselves are not closing down. I don't want to destroy 
market relations but sometimes the state should take a lead," Sergey 
Vadimovich stated. 

Then a discussion of targeted federal programs began. Russian Federation 
Economy Minister Andrey Shapovalyants reported that almost 170 programs, 
which have been adopted in the prescribed manner, are now in operation. 
And though as early as 28 August 1997 the government adopted a decree on 
not considering programs which are not backed by financial resources, it 
proved impossible to stop their exponential increase. During 1998 26 new 
targeted federal programs appeared. It is estimated that approximately 
the same number will appear in 1999 and work is in progress on 60 draft 
programs. 

There is nothing surprising about this. The total crisis enveloping 
Russia's socioeconomic organism creates many problem areas, which is why 
departments insist on such documents being drawn up at every step. At the 
same time the budget's ability to finance such programs has literally 
melted away. While in 1997 the treasury could release 22 billion rubles 
[R] for them, the 1999 budget has only R4 billion for such purposes. 
Which, if you take into consideration the devaluation of the ruble, is 
nothing at all. The programs' investment components are at most 10 
percent funded and the state's indebtedness to creditors is reaching R4 
billion in connection with this. 

What is to be done? In the Economy Ministry's opinion normative acts are 
required to tighten up the procedure for adopting targeted programs. They 
will definitely have to be reduced in number or combined. It is essential 
to improve the management process itself, drawing on the experience of 
the State Committee for Construction and the Housing and Municipal 
Complex which set up a single directorate for 12 targeted programs. If 
the programs aim to develop Russian Federation components, it makes more 
sense to set up unitary directorates on the basis of regional 
administrations. 

Today the state does not monitor very closely the targeted use of funds 
which are released to implement adopted programs, therefore a permanent 
monitoring system is essential. 

According to A. Shapovalyants, we need a clear prediction today of the 
state's 
ability to finance the programs. And not just of the state's ability to 
do so: After all in the majority of programs it is planned to obtain 
sometimes 50-90 percent of funding from nonbudget sources. The Economy 
Ministry considers that in many cases these calculations are baseless and 
departments acting as state sponsors of programs are not fulfilling their 
function to attract nonstate funding. Therefore, it is necessary to make 
these sponsors more accountable and also to accurately track the whole 
process by which budget funds pass from the Finance Ministry to their 
recipients by using organs of the Federal Treasury. But a few resources 
have to be concentrated in facilities which are nearing completion. 

According to A. Shapovalyants, in 2000 around 100 federal programs will end 
which will definitely not have been implemented. Therefore, it is 
necessary to at least regulate our credit debts after trying to clear 
them. The Economy Ministry also wants to inventory current programs 
having wound up around 100 of them. 

Government head Sergey Stepashin has made the following decision: It is 
necessary to establish a commission of vice premiers. It should carry out 
a comprehensive analysis of existing programs in a two-month period with 
the help of regional representatives, leaving only those which are 
strategically important. By so doing, the state will begin to stop 
spreading funding thinly and will target it on priorities. Finance for 
the remaining programs should be included in the draft budget for the 
year 2000. The programs themselves, together with a specific schedule of 
tasks, should be included in the list of urgent government measures for 
1999-2000 which should be adopted in August. 

*******

#11
Caucasus/Central Asia: Study Considers Western Influence 'Mixed' Success
By Ben Partridge

A new study focuses on the expansion of Western influence in the Caucasus and 
Central Asian nations since their independence in 1991. In the first of two 
stories on this topic, NCA correspondent Ben Partridge finds the region has 
proved more resistant to the West's political and economic agenda than had 
been foreseen. 

London, 2 August 1999 (RFE/RL) -- An Oxford professor, Neil MacFarlane, has 
recently considered the question of Western influence in the Caucasus and 
Central Asia. In a study entitled Western Engagement in the Caucasus and 
Central Asia, MacFarlane ponders how successful Western efforts in the region 
have been since the end of the Cold War. He concludes it's been a mixed bag.

The study focuses on the three South Caucasus nations, Armenia, Azerbaijan 
and Georgia, and the five Central Asian states, Uzbekistan, Kazakhstan, 
Turkmenistan, Kyrgyzstan and Tajikistan,

In the Soviet era, many outsiders saw this region as "terra incognita," or 
unknown territory, because it lay behind one of the longest and most tightly 
sealed borders in the world. It was largely cut off from the political, 
economic and cultural influences of the West.

Since 1991, a wide array of Western state, inter-governmental and non-state 
organizations have expanded into the region. Western diplomats, businessmen, 
advisers and consultants have arrived in droves. The extent of this western 
penetration is reflected in growing diplomatic links, bilateral political 
relations, trade and investment ties, and military and other exchanges.

Interested governments include those of the US and the EU, regional agencies 
include the Organization of Security and Cooperation in Europe (OSCE), the 
Council of Europe and, to a lesser extent, NATO; and NGOs include human 
rights and other groups.

OSCE spokeswoman Melissa Fleming says her organization, which seeks 
diplomatic solutions to regional conflicts and encourages free and fair 
elections, has been playing an ever-greater role. 

"It's continuously increasing. We have always been involved in the Caucasus, 
in particular by trying to resolve the Nagorno-Karabakh conflict. We have 
been heavily involved in Georgia, in the conflict over South Ossetia. We have 
a quite active mission in Georgia. We just actually last week opened an 
office in Armenia and we will be doing the same in Azerbaijan. And we have 
similar offices in each of the Central Asian states."

The study poses a fundamental question: why are all these western 
organizations drawn to this relatively remote and landlocked region? A short 
answer is that independence for the region's republics coincided with 
optimism in the West as to the triumph of Western modes of governance and 
management of the economy. The end of the Cold War, and the resolution of the 
conflict between two competing social systems, was seen as an emphatic 
victory for the West's credo of democracy and economic liberalism.

Many assumed that the Western model could be transferred, not only to the 
newly free states of Central and Eastern Europe, but also to the newly 
independent states of the former Soviet Union.

Accordingly, the former Soviet Union was "perceived to be a new frontier for 
the propagation of the 'Western way.'" Hence Western organizations and 
agencies have been pressing a political agenda aimed at making the former 
Soviet republics 'more like the West.'

Western preoccupation with the region partly reflects a growing interest in 
its energy resources, a recognition of its geo-political significance, a 
desire to balance Russian influence, and also to help a region that could be 
a bulwark against Islamic fundamentalism.

Western politicians and officials have been urging Caucasus and Central Asian 
leaders to embrace democratization, the rule of law, economic reform, the 
concept of civil society, and the integration of the region into global 
economic structures. Western state and private commercial concerns have 
pursued their own economic agenda: above all, access to the Caspian region's 
oil and gas.

Many former Soviet republics perceive the engagement of these western 
organizations as one way to balance what the study calls the "otherwise 
overpowering Russian influence in their affairs."

But, despite US and EU efforts on this score, many in the Russian elite see 
the maintenance on Western influence on the former Soviet south as an effort 
to displace Russia and, thus, a strategic threat.

But OSCE officials are surprised by claims in the new study that many 
Russians see organizations like their own as "stalking horses," or screens 
behind which the West's real intentions are concealed. 

"We have never actually had any complaint from Russia. In fact, they are very 
pleased that we are in many of the countries that were their former territory 
. . . So I would say quite generally that we have very good support from 
Russia, and we need Russian support in order to be successful in these areas."

Leaving aside the geopolitical dimension, the study poses the question: after 
almost a decade of engagement, to what extent has the western agenda been 
realized in the Caucasus and Central Asia?

The study comes to a somewhat pessimistic conclusion. It says, in 1999, much 
of the early optimism of the post-independence era has been lost as states 
and societies have "turned out to be more resistant to . . . the Western 
agenda than had been foreseen."

The situation differs from country to country. But, in general, there has 
been little real movement towards democracy. The rule of law is often 
notional. Political parties and legislatures remain weak, structures of power 
tend to be personalized, and judicial structures are arbitrary and often used 
for political purposes. The rights of the media and individuals are 
frequently violated.

Movements in directions favored by the West have been more substantial in the 
economic sphere although reform has been slow and hampered by institutional 
resistance and corruption. But the region's states have, on the whole, made 
some progress in economic stabilization, privatization, and on market 
legislation and regulation.

Still, the study concludes that the record of Western engagement in the 
Caucasus and Central Asian countries has been "mixed and ambiguous" and has 
failed to meet the early hopes of the optimists. 

*******