August 11, 1999    
This Date's Issues: 3432 • 3433 • 3434

Johnson's Russia List
#3433
11 August 1999
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Campaign For Russia's Duma Poll Officially Opens.
2. Interfax: UES CHIEF ANATOLY CHUBAIS OPENS PERSONAL WEB-SITE.
3. AFP: For once-coddled Russian miners, life is the pits.
4. Russia Today: Rod Pounsett, I Spy Another Spy.
5. Financial Times: Moscow faces prospect of second Chechnya. The poor, 
ethnically diverse republic of Dagestan is important strategically and 
will not be easily pacified, says Andrew Jack.
6. Christian Science Monitor: Fred Weir, Russia's breakaway republics.
7. Paul Backer: Beating the "Year After" rush on Who Lost Russia's ...
aid. 
8. Sabirzyan Badretdinov: WOULD RUSSIA'S DISSOLUTION STRENGTHEN 
INTERNATIONAL SECURITY? 
9. The Times (UK) editorial: A NEW CIRCUS BEAR. Another day, another 
Russian Government.
10. Bloomberg: US Backs WTO Entry of 5 Former Soviet Republics Before 
Russia.
11. Moscow Times: Melissa Akin, Wary Duma Expects To Confirm Putin 
Fast.]

*******

#1
Campaign For Russia's Duma Poll Officially Opens

MOSCOW, Aug 11, 1999 -- (Reuters) Campaigning for Russia's parliamentary
election officially began on Tuesday with a warning that the nomination of
a new prime minister might force a delay in the poll, set for December 19. 

President Boris Yeltsin signed a decree on the election to the State Duma
lower house on Monday, the day he also sacked Sergei Stepashin as prime
minister and nominated security chief Vladimir Putin to head a new
government. 

"The decree officially comes into force today, marking the formal start of
the election campaign for the State Duma," said the head of Russia's
Central Election Commission, Alexander Veshnyakov. 

But replying to reporters' questions about the possible impact of Russia's
latest political upheaval on the Duma election, Veshnyakov said it could
"hypothetically" force a postponement of the poll. 

If the Duma rejects the president's candidate for prime minister three
times, Yeltsin must dissolve the chamber and call a fresh parliamentary
election. The new chamber must convene no later than four months after the
dissolution. 

The Duma is due to hold its first vote on Putin's candidacy next Monday,
August 16. If it rejects him three times, Yeltsin would dissolve the Duma
on August 30, the day of the final vote, and the newly elected chamber
would have to meet by December 30. 

But Veshnyakov said this would not allow enough time after a December 19
vote to allow votes to be counted and for other necessary procedures to be
completed. 

"In such a case, we would have to consider changing the date of voting," he
said, adding that he thought lawmakers would nevertheless approve Putin on
the first vote, allowing the Duma election to go ahead as planned. 

"I think the State Duma understands the situation and will agree with the
president (on Putin) the first time round." 

Veshnyakov noted that the Duma had still not approved a reorganization of
constituencies proposed by the Central Election Commission to reflect
demographic and other changes in the electoral roll since the last election
in 1995. 

He said the old 1995 system would remain in effect if the Duma failed to
approve the changes by next month. 

Veshnyakov said he had just received from the Justice Ministry a list of
139 parties and organizations allowed to take part in December's election. 

All parties had to register by December 19, 1998. The ministry ruled on
Monday that Moscow Mayor Yuri Luzhkov's Fatherland party, which registered
on December 19 last year, was eligible to run. Fatherland, which has forged
an alliance with the All Russia movement of regional leaders, is expected
to score well in the Duma election. 

Russia's 107 million voters directly elect half the members of the 450-seat
Duma in their local districts. The remaining 225 seats are allocated to
parties in proportion to the percentage of the nationwide vote they
mustered in the election. Parties must poll a minimum of five percent of
the vote to qualify. 

Parties are not allowed to canvass for votes until their candidates have
been officially registered with the Central Election Commission - a process
which begins in early October. 

Veshnyakov said political parties breaking that rule would face a penalty,
which might mean being stripped of their registration. 

Several parties, including Vladimir Zhirinovsky's ultra-nationalist Liberal
Democrats, have already begun airing political broadcasts on television but
until Tuesday they did not constitute a violation of the electoral law. 

Russia will also choose a new president next summer when Yeltsin's term
expires. Yeltsin is barred from standing again and on Monday named the
little-known Putin as his favored heir. 

********

#2
UES CHIEF ANATOLY CHUBAIS OPENS PERSONAL WEB-SITE 

MOSCOW. Aug 11 (Interfax) - Chief of the Unified Energy Systems of
Russia (UES) and head of the Right Cause coalition's campaign staff
Anatoly Chubais opened his own personal web-site on Wednesday, says a UES
pressrelease circulated on Wednesday. 

Chubais's spokesman Andrei Trapeznikov said that this is one more
confirmation of the fact that Chubais does not plan to quit politics. 

He also said that as chief of the UES Chubais opened a web- site on
company-related subjects a long time ago. "His new web- site will be more
personal," he said. 

The web-site http://www.chubais.ru holds the UES chief's most
significant statements on political events, the economy and power
engineering, his biography and reference materials. Visitors are
welcome to ask questions. Chubais has planned to hold a virtual on-line
press conference for a long time. Now this idea has become feasible. 

*******

#3
For once-coddled Russian miners, life is the pits

VORKUTA, Russia, Aug 11 (AFP) - Once the feted heroes of Soviet labour,
Russia's miners have seen their quality of life steadily sink since the
break-up of the communist empire in 1991.

A decade ago they were the aristocrats among workers, paid four to six
times better than others, envied in the Black Sea resorts where they spent
their summer vacations, but appreciated for the spending power.

Urged by officialdom to produce more for the motherland, the miners
accepted the deal offered -- endure the harsh conditions of the Siberian
coalfields for 20 years and earn enough to buy a house and car in the warm
south.

"At the time the girls dreamed of marrying us. Now advertisements for
husbands say 'no miners or prisoners'", said one disillusioned pitman on
sick leave for sciatica.

With the perks gone, Russia's miners are left to suffer in ends of the
earth like Vorkuta, where winter lasts for 11 months and temperatures drop
to 30 degrees below freezing.

Built on the bones of the political prisoners of the Stalin era, Vorkuta
has 180,000 inhabitants, of whom 15,000 are miners working the seven pits
of the area that are still producing.

In a typical mine, the Komsomolskaya, they hew coal almost a kilometre
(1,000 yards) underground, in dangerous conditions where gas blasts are
frequent and the only light comes from the workers' helmet lamps.

To the six hours at the coalface must be added the long journey to and from
the pithead through galleries which total 146 kilometres (90 miles).

After their arduous shifts the miners return to eat in the works canteen,
for tickets issued against the pay owed them. For their wages of 1,200
rubles (50 dollars) a month are 13 months behind, and in that time have
been devalued by 75 percent following last August's financial crash.

Families eat in the canteen as well, as the allotment gardens which save
many Russians from starvation are impossible to cultivate in the frozen
tundra 100 kilometres north of the Arctic Circle.

Mine boss Alexander Kharlov, 40, has worked here for 22 years and is
officially entitled to take his retirement. "But my pension would not allow
me to live more than one week in a month," he said.

"More than 10,000 pensioners who have the right to leave Vorkuta are unable
to do so," Kharlov said. He hopes that a new rehousing programme worked out
with the World Bank and the International Monetary Fund in a plan to reform
the mining industry will bear fruit.

As much prisoners as the victims of Stalin who once laboured in the gulags
here, the miners have a low life expectancy, suffering from lung diseases
and sciatica aggravated by the lack of modern machinery.

But Kharlov is a hard taskmaster, concerned to raise production to planned
levels. "A day off work can mean the sack," he said.

The notices urging workers to produce more for the motherland are still
there, but output stands at only 1.5 million tonnes a year from a pit which
should be supplying 2.5 million.

Kharlov claims to have good relations with the unions. "Perhaps I'm lucky
but I understand their problems and they try to understand mine," he said.

The mine boss hopes to see more interest in the industry from politicians
as elections approach. "They don't respect the miners any more but they
fear them and are watching to see how they behave," he said.

The answer may not be long in coming -- "People still have patience, but
one day the young ones are going to rebel," an active trade unionist
warned. 
*******

#4
Russia Today
www.russiatoday.com
August 11, 1999 
I Spy Another Spy 
By Rod Pounsett

So President Yeltsin has once again shown us he's still able to pull
political tricks out of the hat. But this time there's no white rabbit,
just very gray one. In fact, an extremely lackluster back room spy called
Vladimir Putin who has been thrust into the limelight as Yeltsin's latest
replacement prime minister. The name may be new to many people but the
trick isn't. This is the fifth time in seventeen months Yeltsin has chosen
this gambit of changing prime ministers and governments as an attempt to
escape from a political fix. The latest threat to the ailing president is
coming from the newly formed potentially powerful alliance of the
Fatherland Party and All Russia grouping of regional leaders. An alliance
which could easily grab the reigns of power in the Duma at the forthcoming
general election and later steal the presidency. 

It seems Yeltsin sees this 47 year politically inexperienced intelligence
service pen pusher, surprisingly promoted to run the Federal Security
Service (successor organization to the KGB) and later secretary of the
powerful Security Council, as a safe bet in the run up to the elections.
And he is even suggesting Putin will be his nominee to succeed him as
president. 

While the sacking of Sergey Stepashin cannot be seen as a great surprise,
considering both his dull performance in office and the imprudent remarks
he has been making about head office mismanagement during foreign trips,
the choice of Putin must be regarded as somewhat odd. And it will certainly
do nothing to boost international confidence in Russia's ability to manage
itself out of crisis. 

There are certainly some raised eyebrows in capitals around the world and
political circles in Moscow, accompanied by wide eyed amazement among
Putin's intelligence colleagues who regarded him as a bit of a Mr. Nobody
with the nickname "Gray Cardinal". 

As a spy, he had never surfaced as a type to go all the way. For many
years, he was a relatively low trade field operative in the former East
Germany. But on his return to Russia after the collapse of the Soviet
Union, he seemed to side step into a low-profile upwardly-mobile track
through the corridors of power; steering clear of controversy and winning a
reputation for efficiency, safety and, above all, loyalty. 

It's rumored that Putin's adoption by the Yeltsin inner circle was promoted
once again by former deputy premier Anatoly Chubais. It was Chubais who
brought Putin to Moscow in 1996 from St. Petersburg where he'd slipped into
the political frame as an aid to the former mayor of Russia's second city,
Anatoly Sobchak. 

Yeltsin says Putin is just the man to carry the baton of reform and
democracy. But he seems to say that about most spies these days. He has
been putting more and more people from the Russian intelligence community
into key political posts during recent months. Not least was his choice of
former spymaster Yevgeny Primakov as prime minister one before last. It
doesn't seem to bother Yeltsin that these former spies can be quick to
change loyalties. Primakov is likely to be backing the new Fatherland/All
Russia alliance. 

But I have a sneaking suspicion that the cunning old man Yeltsin and his
"family" in the Kremlin have yet to show their complete hand on this one.
There is a worrying crisis bubbling up in Dagestan where Islamic
fundamentalists have declared independence and called for amalgamation with
neighboring Chechnya. This may be just the sort of excuse Yeltsin is
looking for to declare a state of emergency which could serve to postpone
the elections and give him and his cronies more time to build a defense
against the new Alliance threat to his power base. 

Russian defense chiefs have claimed the situation in Dagestan is under
control. But the Dagestan rebels call for a holy war against Russia has
been picking up support amongst disenchanted Islamic groups both inside and
outside Russia. There have been reports that there are a number of
mercenaries from Arab states fighting along side the Dagestan rebels. 

Yeltsin could easily drum up support for a major military initiative in
that region to avoid a similar defeat to the one Russia suffered in
Chechnya following the 1994-96 war in that province. With Russian armed
forces engaged in a major internal conflict, he retains the power to order
a postponement of the elections. 

*******

#5
Financial Times
11 August 1999
[for presonal use only]
RUSSIA: Moscow faces prospect of second Chechnya 
The poor, ethnically diverse republic of Dagestan is important strategically 
and will not be easily pacified, says Andrew Jack

As Russian troops intensified their action against Islamic rebels in the 
southern republic of Dagestan yesterday on the fourth day of clashes, 
observers warned of the risks of a new Chechen-style war in the Caucasus.

With an impoverished population of just 2m split into some 32 distinct ethnic 
groups and squeezed into an area of 50,000 sq km, Dagestan is a powder keg. 
Its strategic location along the oil-rich Caspian Sea also makes it too 
important for Russia to ignore.

"You have high fertility, scarce goods, a small space, and many different 
ethnic groups crammed into a small space - almost all the pre- conditions for 
conflict," said Helge Blakkisrud, head of the Centre for Russian Studies at 
the Norwegian Institute of International Affairs. "Little is needed to ignite 
conflict. If things are allowed to escalate, the civil war in Chechnya would 
be relatively straightforward in comparison."

Lawlessness in the neighbouring breakaway republic of Chechnya has helped 
destabilise the region, and provided a base for local warlords to send their 
militias into Dagestan - notably during the forays that have taken place 
since Saturday.

Mukhu Aliyev, head of Dagestan's lower house of parliament, said yesterday 
that small groups of rebels had seized two hamlets in the Tsumandinsky region 
and three villages in the Botlikhsky region, both on the Chechen border. He 
claimed the rebels were not Dagestani, but Chechens, Tajiks, Afghans and even 
Arabs.

This highlights an important distinction with the Chechen war, which became a 
struggle between the authorities in Moscow and the Chechens, who united 
against Russia in the face of an aggressive military onslaught that forged 
alliances between Islamic extremists and secular groups after autonomy.

The Russian authorities attribute the latest clashes to the growth of the 
Wahhabi sect of Islam, which they characterise as fundamentalist and claim is 
funded by countries such as Saudi Arabia and Kuwait. But others suggest there 
is a subtler mixture of forces at work, not all of them purely religious.

While the former Soviet regime maintained a tight grip over the region it 
also encouraged the romanticised notion of different ethnicities. Now outside 
control has weakened, but the divisions along clan and ethnic lines have 
grown stronger.

Mr Blakkisrud says when he visited Dagestan in 1996, the borders with 
Chechnya were all but open and even some lowland areas were out of the 
authority of the government. An unofficial, self-proclaimed Shura Islamic 
Council yesterday proclaimed Dagestan an independent state, but a number of 
villages have long acted autonomously of the regional administration in 
Makhachkala.

The economic situation of Dagestan has also worsened in recent years, 
aggravating the ethnic divisions. In Soviet times, many workers supplemented 
meagre incomes with annual migrations for temporary work. Over the past 
decade the collapse in local infrastructure and growing discrimination in 
Russian cities against Caucasians have all closed off such options.

Sergei Arutiunov, chairman of the department of Caucasian studies at the 
Russian Academy of Sciences, plays down the parallels with Chechnya, 
stressing that there is no equivalent memory of genocide by the Russians, and 
that Dagestan remained calm while the war ravaged its neighbour during 
1994-96.

But he says 85 per cent of Dagestan's wealth is concentrated in the hands of 
200 families and perhaps 200,000 others who work with or for them. The 
remainder are four or five times below the pitifully low Russian average 
standard of living.

Mr Blakkisrud says power-sharing rules among the republic's competing groups 
are crumbling. Last year parliament changed the constitution, allowing the 
current president to stand for office again, overturning the principle of 
rotating power between different ethnic groups. "My fear is that it's a 
question of time how long they can hold the balance."

********

#6
Christian Science Monitor
11 August 1999
Russia's breakaway republics
Fighting in Dagestan may be only the tip of the iceberg for the troubled 
north Caucasus region. 
By Fred Weir Special to The Christian Science Monitor

Once again, Russia's weakening central government is facing the threat of 
lost territory on its volatile Caucasus frontier. 

Three years after a devastating separatist rebellion in Chechnya, a brand of 
Islamic extremism is igniting civil war in the neighboring republic of 
Dagestan, a mountainous region beside the Caspian Sea rife with social and 
ethnic tensions. 

In recent days, as many as 2,000 armed militants claiming to belong to the 
Wahhabi Islamic movement (see story, below) have seized several villages near 
Dagestan's border with Chechnya, declaring the territory independent and 
demanding that Russian troops leave Dagestan. 

Russia, occupied with a political crisis touched off Aug. 9 when President 
Yeltsin fired his fourth prime minister in 18 months, accuses Chechen 
warlords of orchestrating the attack and has responded with massive military 
force. The ITAR-Tass news agency quoted the new acting prime minister, 
Vladimir Putin, as saying Aug. 10 that the standoff would be over in two 
weeks. 

Repeating old mistakes 

Like television footage of the conflict, the claim is eerily reminiscent of 
the two-year conflict in Chechnya, when Russian generals initially predicted 
victory in a similar time frame. 

Critics warn that, however the operation turns out, Moscow is repeating 
mistakes it has been making since conquering the region in the mid-19th 
century. By doing so, it risks a protracted cycle of turmoil in the 
non-Russian, non-Orthodox Christian republics of the north Caucasus. 
Ultimately, they say, that could lead to the dissolution of Russia's 
patchwork federal system. 

"The present conflict in Dagestan is, unfortunately, not an isolated case," 
says Sergei Kazyennov, an analyst with the Institute of National Security and 
Strategic Research, a Moscow think tank. "These peoples are not Russian, and 
the federal government in Moscow has not pursued policies that incline to 
make them feel Russian. This makes them identify more with outside forces, 
with the ideology of Islam and the countries of the Muslim world. 

"To reverse this process would take massive economic investment and a whole 
set of new policy ideas for the region. Neither of these resources seems to 
be available in Moscow today," he says. 

Local roots of unrest 

Russia's claim that the unrest is imported "is a very narrow view," says 
Alexander Iskandaryan, deputy director of the Center for Caucasian Studies in 
Moscow. "Of course Chechens are involved, as are agitators from the Arab 
world and other places. But most of the rebels in Dagestan are local, as are 
the causes of their uprising." 

Mr. Iskandaryan says discontent and Islamic radicalism are rising in 
Dagestan. This is due in part to mass poverty, acute since the end of 
Soviet-era subsidies and development. Unemployment is estimated as high as 80 
percent. "All over the Muslim world young men become radicalized when there 
is no land, no money, no jobs, and no prospects," he says. 

The collapse of Communist ideology left a vacuum that was quickly filled by 
the region's traditional Muslim religion. For many intellectuals, breaking 
with Soviet ways meant embracing the most extreme Islamic movements, such as 
Wahhabism. "The combination of committed, radical intellectuals and a mass of 
poor, angry, young men is social dynamite," says Iskandaryan. "Those are the 
prevailing circumstances in Dagestan, and throughout the North Caucasus 
today." 

But Russia isn't about to let the Caucasus go. The post-Soviet state is a 
shaky federation made up of 20 ethnic republics and 69 provinces, which are 
firmly denied any right to secede under the Constitution. Any move to declare 
independence is viewed in Moscow as a criminal act and a threat to the 
survival of the federation itself. 

And there is a growing sense that Islamic-inspired unrest is coming closer to 
Russia's heartland. "Dagestan is not a faraway place, it is a Russian place 
where everyone speaks our language and shares the same kind of life with us," 
says schoolteacher Maria Shelyabova. "To watch this madness starting up there 
is very, very frightening." 

The Soviet Union fought a nine-year war in Afghanistan, ostensibly to stem 
the tide of militant Islam. 

Russian troops are still entrenched and taking casualties in the battle 
against Muslim tribesmen in the former Soviet republic of Tajikistan. 

*******

#7
From: "Paul Backer, Esq." <pmcllc@email.msn.com>
Subject: Beating the "Year After" rush on Who Lost Russia's ... aid.
Date: Wed, 11 Aug 1999 

The interesting aspect of the back and forth on the Le Monde article
regarding whether the IMF "knew" or didn't know on loan diversion is that it
reveals the unenviable position of the IMF and of all of the other foreign
grantors and lenders active in Russia a year after the Russian crash.

It appears we as consumers and analysts of information about Russia and the
IMF have two choices:

Choice 1. IMF knew all along and was complicit in FIMACO and all of the
other shenanigans. In other words, the IMF's biggest debtor was laundering,
hiding, misappropriating and well ... losing and misplacing billions of
dollars with the complicity of IMF. (an attractive option for those who
can't believe that billions can be lent lacking ANY meaningful supervision)
Choice 2. IMF has no idea where its money went. (an attractive option for
those familiar with foreign lenders' practices in Russia)

The "inside" RF government version is Choice 1, with added IMF complicity in
last August's "devaluation". As revealed by IMF's public affairs
department, the IMF feels better served, by a sad parody of Sergeant Schultz
from "Hogan's Heroes", "I know nothink ... absolutely nothink."
Pathetically, Choice 2 is probably correct.

The IMF, WBk, US AID, EBRD and other funders, in their rush to get money
into Russia, never gave any serious effort to watching how the money was
spent and measured success by their ability to place money in Russia. "Of
course we are effective, we spent X tens or hundreds of millions last year".
The efficacy of that approach is self evident on the streets of Russia
today.

When the failure of "our ability to put money into Russia proves we are
effective" approach became self evident, the lenders switched their
attention to legislative reform in Russia consisting largely of fine tooling
the Russian federal budget, a document not quite as meaningless as the
Stalin constitution, which at least was dutifully memorized by millions of
schoolchildren while others pretended to follow it. The only evident area
of agreement between the democratic and the red/brown political wings is
that the budget is a meaningless document, yet the lenders and the foreign
(non Russian) news media hang on every clause with baited breath. The other
reform direction was the effort to enact increasingly meaningless
legislation, in the vast majority of cases having at best an academic
interest to most participants in the economic realities in Russia.

Some of the aid's results were very good, some fed, clothed and housed those
unable to help themselves, some were wasteful, some were harmful, many were
simply laughable, others just impossible to understand, yet what made most
projects remarkable was their disconnect from the realities of Russia and
its needs. These projects were never self sustaining nor had hope of being
self sustaining. At the end of the day, virtually no effort or money was
spent by any funder on enforcement of the existing legislation in the
commercial and finance spheres such as corporate finance, governance,
shareholder and investor rights needed to give Russia a functioning economy
encouraging investment and participation by protecting shareholders,
investors and depositors.

Almost a decade and billions of dollars of loans, grants and projects later,
we are left with the spectacle of an economy which according to what are
almost certainly objective evaluation criteria by at least one prominent
investment bank shows great promise primarily due to:
1. Increased domestic production and declining share of imports. This
economic miracle will likely continue as the Russian population becomes more
and more impoverished with the collapsing value of the ruble.
2. Increased domestic (non bank) savings. Just some of the advantage of a
Potemkin stock market where stocks with reported sales volume of ZERO
dollars can be the most active issues of the day and a completely
discredited banking system.
3. Increased tax collection. Considering that Russian federal tax
collection largely relies on tax on oil, gas and other natural resources
sold for hard currency, but measured in increasingly devalued ruble this
miracle will likely continue.

Some choice, IMF makes a virtue of its ignorance, while investment banks
look for the greater fool for the Russian market. Unfortunately, to this
day Russia still can't give an accounting of what happened to the aid
billions it received. Leaving us with the question whether Russian
government was complicit all along or has no idea where its money goes.

The argument that failure to effectively allocate any amount, even billions
in spending by the usual suspects (IMF, WBk, EBRD, US AID, etc.) "lost"
Russia is laughable. Russia is a nation of 150 million people and was never
"ours" to lose. However, it is discouraging that even to this day, there
seems to be no effort to promote the meaningful enforcement of vital RF
corporate finance and governance legislation, rather a mad rush for generous
per diems in Russia and a headlong rush to prove that they ... know nothing.
Russia would be far better served by an effort to form a constituency for
shareholder, depositor and investor protection than a rush to the ostrich's
safe harbor of "if we can't see the danger, it's not there."


Paul Backer, J.D., LL.M.
The author worked on several Rule of Law projects in the FSU, can be reached
at pbacker@glasnet.ru, but regrettably ... "knows nothink".

******

#8
From: Sunset4642@aol.com (Sabirzyan Badretdinov)
Date: Wed, 11 Aug 1999
Subject: WOULD RUSSIA'S DISSOLUTION STRENGTHEN INTERNATIONAL SECURITY? 

WOULD RUSSIA'S DISSOLUTION STRENGTHEN INTERNATIONAL SECURITY? 

For the first time since 1992 the Russian media is seriously discussing the
possibility of Russia's breakup into a number of independent states. General
economic decline, regional separatism, weak federal leadership and the
replacement of Yeltsin's appointees in the regions with locally elected
governors may indeed lead to Russia's disintegration and to the disappearance 
of one of the world's nuclear superpowers. Should this prospect be welcomed 
or feared? Should the US encourage Russia to protect its territorial 
integrity and political cohesion or should it consider an alternative policy?

Most Western experts accept as an axiom that Russia's territorial and
political integrity is a major factor guaranteeing the security and stability
necessary to keep the huge stockpiles of weapons of mass destruction in
relative safety. The alternative, Russia's disintegration, is viewed as
tantamount to chaos - terrorists and rogue states would get access to doomsday
weapons. The reality, however, does not warrant such an assumption. In fact,
the opposite appears to be true. 

When and if Russia splits up, most of its 88 regions will become independent
states. The majority of these states will not have the financial and
technological abilities to maintain the weapons of mass destruction. 
Furthermore, the regions are less likely to be involved in armed conflicts
and more likely to safeguard its weapons and to agree to arms control
measures. Consider the following facts:

1) Russia's disintegration will make it very difficult or impossible for
many regions to continue the manufacture of nuclear, chemical and
bacteriological weapons because the industry is not concentrated in any one
region. Very often, the manufacture of such weapons is based on a production
chain that is shared by two or more regions. For example, the renowned
weapons laboratory Arzamas 16 is located partly in Mordovia and partly in
Nizhny Novgorod. Were either of these regions to become independent states
the chain of production would be broken. 

Mobile ICBMs are based in Mari El and Perm; silo-based ICBMs are located
in Orenburg, Saratov, and Chelyabinsk. Most nuclear warheads for these 
missiles are produced, however, in other regions. Uranium is enriched in 
Sverdlovsk, but reprocessing facilities are located in Chelyabinsk. Were 
these 
regions to become independent states, the coordination of resources needed 
for 
the continued production of weapons would be difficult or impossible to
maintain. 

2) Without Moscow's subsidy of local defense industries, most regions would 
be forced to convert defense plants to civilian uses. Many of Russia's
regions cannot maintain their weapons production without being supported by
Moscow. For example, 80 % of Mari El's industry is defense-related. Such
a ratio of defense-related industry to civil production can exist only within 
a larger state. However, If Russia disintegrates and the region becomes
independent, Mari-El will be left with no other choice but to immediately
start conversion of its defense-related industries to civilian production.

3) Weapons facilities may well be more, not less, secure if they are
guarded by local rather than federal authorities. It is frequently argued
that the weakness of Russia's federal center makes it more difficult to
safeguard the weapons stockpiles and may allow terrorists to get hold of
them. But the opposite is true: Most nuclear facilities are guarded by
federal troops, who are usually underpaid and have no incentive to do their
job properly. Regional troops are better paid and are better motivated to
ensure the safety of weapons.

4) Regions will have greater incentives than Moscow to negotiate arms
control measures. Once Russia disintegrates, it will be easier to convince
the regions to give up their weapons than to convince Russia to disarm. The
regions are likely to be more susceptible to such international measures
as offering or withholding financial help and membership in international
organizations such as the UN, diplomatic recognition, etc. 

5) Contrary to most doomsday scenarios, the independent regions are not
likely to use the weapons of mass destruction against each other, even if they
had an ability to do so. The argument that Russia's disintegration will
result in dozens of Bosnias is simply naive because, unlike Bosnia, most
Russian regions share a common culture, language and religion. Their 
geographical proximity makes the use of weapons of mass destruction 
impossible. Moreover, most regions lack the necessary infrastructure for 
using such weapons (some regions would have missiles but no warheads, some 
might have bombs but no delivery systems, etc.) Notably, there have been no 
territorial disputes among the ethnically Russian regions and there is no 
history of hostilities among them. The absence of any history of conflict 
is, of course, in stark contrast, for example, to the history of Yugoslavia 
or sub-Saharan Africa.

Russia's disintegration would eliminate one of the most unstable nuclear 
powers in the world. Moscow would not be able to make mischief in the "near
abroad" and continue to offer military and technical help to such aggressive 
and bellicose regimes as Iraq, Iran, Serbia, etc. 

In short, the US and the world should not fear Russia's possible 
disintegration. It would be a positive process beneficial both for the world 
and for the Russian people. Therefore, the US will be well-advised not to 
prolong the agony of the Russian superstate and the suffering of the Russian 
people by propping up an unpopular, unviable regime with financial help. 
Washington ought to consider establishing direct contacts with Russian 
regions,
clearly favoring those that have declared themselves "nuclear-free zones" (for
example, Tatarstan). It would be reasonable to open US consulates in regional
capitals (so far the US has consulates only in Moscow, St. Petersburg and
Yekaterinburg) and to establish ties with regional parliaments and leaders of
nationalist movements in ethnic republics. 

******

#9
The Times (UK
August 10 1999
Editorial 
A NEW CIRCUS BEAR 
Another day, another Russian Government 

President Boris Yeltsin's latest change of Government brings to four the 
number of Prime Ministers he has booted unceremoniously out of office since 
March last year - usually only a few months after they trotted, smiling 
hopefully, into the chandeliered halls of the Kremlin to try their luck at 
running Russia. While Sergei Stepashin, who had lasted less than four months 
in the job, nursed his bruises and waited in vain for an explanation of why 
he had come unstuck, Prime Minister Number Five had already been lined up for 
his try: Vladimir Putin, a faceless-wonder bureaucrat with a background in 
the security police and a yearning to rebuild that organisation. His most 
noteworthy characteristic is his grey interchangeability with his 
predecessor. Yet Mr Yeltsin announced that the latest ex-KGB retread was the 
ideal candidate to take over as President when his own term expires next year 
- another shock, as in his eight years at the Kremlin, the President had 
never until yesterday explicitly endorsed an heir. 

If the 68-year-old Mr Yeltsin had been a circus ringmaster, he could scarcely 
have juggled more balls at once. His disruptive staffing extravaganza hardly 
seems to be in Russia's interests. It leaves the country without a 
Government, again, in the middle of debt negotiations in London and a show of 
strength with Islamist militants in the South. It could also, in theory, 
provoke another of the confrontations between President and parliament that 
fill post-Soviet history. Mr Yeltsin's enemies in parliament now get a 
chance, under the Constitution, to vote on his new choice of Prime Minister, 
although, with elections set for December, they are unlikely in practice to 
pick a last-minute fight. 

There may, however, be opportunistic method in Mr Yeltsin's apparent madness. 
While not good for Russia, yesterday's reshuffle could be good for his own 
clique of supporters. With general elections in December and voting for a new 
President due next June, Russia is gradually dividing into two political 
camps. The Moscow elite is swinging away from the Kremlin leader, whose 
unpopularity is reflected in single-digit poll ratings. Aides who were once 
stars of the Yeltsin administration are now reappearing, working for a loose 
rival grouping of the Fatherland party of Yuri Luzhkov, the Mayor of Moscow, 
and the All Russia front of powerful regional governors. They hope to win 
over the last Prime Minister but one, the former spymaster and Foreign 
Minister Yevgeni Primakov, and win a parliamentary majority before going for 
the presidency. Since Mr Stepashin became Prime Minister in April, defections 
from the Kremlin have speeded up. Some Moscow observers think he was sacked 
as a punishment for failing to stop the haemorrhage, and to let Mr Yeltsin's 
entourage find a successor who protects their interests better. 

Yet reaction to the reshuffle was muted. Western leaders quickly pledged to 
work with the new Government; debt talks were to continue. The US National 
Security Council praised Mr Putin's "constructive" views on Kosovo. The 
rouble wobbled, but did not nosedive. Even Mr Yeltsin's Communist enemies, 
who hold a majority in parliament and who gloated that the President had 
proved himself insane, did not rule out voting for Mr Putin next Monday. 
Voters long since innured to Mr Yeltsin's capricious predilection for 
quick-change governments and political sleight of hand just shrugged and 
prayed for a more rational leader next summer. 

For, eccentric though he undoubtedly is, Mr Yeltsin has only ten more months 
in power under the Constitution. The Moscow rumour mill suggests he might try 
to foment enough unrest to justify suspending the Constitution, and stay on. 
But Mr Yeltsin has, in the past, respected the rules of the political game 
and seems likely to do so now. While Russian politics still has two rival 
camps, each preparing for the battles of the year ahead, Russian democracy, 
however odd, is also still in with a chance. 

******

#10
US Backs WTO Entry of 5 Former Soviet Republics Before Russia

Washington, Aug. 10 (Bloomberg) -- The U.S. is 
backing several former Soviet republics in their bids to gain membership to 
the World Trade Organization ahead of Russia, a move policy analysts say may 
breed tension between the two countries. 

Susan Esserman, deputy U.S. trade representative, said as many as five former 
Soviet republics could join the global trade arbiter by a November gathering 
of ministers. The meeting is expected to lead to accords among 134 countries 
on slashing tariffs and easing other trade barriers for farm goods and 
industries such as telecommunications. 

Georgia, Armenia, Estonia, Moldova and Lithuania are likely to join existing 
WTO members Latvia and Kyrgystan, also formerly part of the Soviet Union. 
``Membership in the WTO can make a major contribution to reform'' in these 
countries by integrating them into the global economic system, Esserman said 
at a congressional hearing last week. 

The U.S. approach risks irking Russian officials just as the U.S. attempts to 
improve relations between the two countries by backing a $4.5 billion 
International Monetary Fund loan to bolster Russia's economy. 

``They've been offended in the past that they haven't been supported,'' said 
James Millar, an economics professor at George Washington University. ``This 
will just be an irritant in the relationship because we're sort of prying the 
former states of the republic from their (Russia's) sphere of influence.'' 

`Political Reasons' 

Russia outweighs the five smaller former Soviet republics as a trading 
partner of the U.S. Two-way trade amounted to $9.3 billion with Russia in 
1998, compared to $624 million with Armenia, Estonia, Georgia, Moldova and 
Lithuania. 

Alexander Surikov, senior counselor at the Russian embassy in Washington, 
said the timing of the WTO entry of neighboring states is ``mostly for 
political reasons,'' though he denied it would raise U.S.-Russian tensions. 

``Now that we're a market economy we don't understand why we are not treated 
as a market economy,'' Surikov said. ``Some people still think Russia is 
imperialistic and try to make our neighbors more close, hoping that it will 
cement democracy and (lead to) reforms in this country.'' 

To be certain, some signs point to better prospects for Russia. From March 
until yesterday's surprise firing of Russian Prime Minister Sergei Stepashin, 
the ruble has remained stable and the Russian government has cut spending. 
After getting the IMF loan approval two weeks ago, the country won a two-year 
payment delay on $8 billion owed to governments from Soviet-era borrowing. 
Yet U.S. trade officials don't expect Russia to be one of the countries to 
gain WTO membership by November. 

In last week's testimony, Esserman didn't list Russia as one of the countries 
the U.S. is supporting for membership by this autumn, although she called 
recent talks with Russia ``fruitful.'' 

Isolating Russia 

Russia is especially sensitive about U.S. influence in Georgia and Armenia, 
which are located south of Russia's volatile north Caucasus region, where 
Moscow has struggled since the Soviet Union's collapse to stem an 
independence movement, Millar said. 

``The Russians have been very worried about the fact that Americans have been 
trying to establish themselves,'' in the region, where Russian troops are 
fighting Islamic rebels. ``All of this makes Russian leaders feel under 
attack.'' 

Exxon Corp. and Mobil Corp. are among the U.S. companies trying to tap the 
vast oil reserves of the nearby Caspian Sea, and the U.S. is pushing for a 
long-term export pipeline through its ally, Turkey, over a competing route to 
a Russian Black Sea port. 

Still, politics isn't the sole consideration in the effort to bring Russia's 
neighbors into the global trade body first, said Thomas Graham, senior 
associate at the Carnegie Endowment for International Peace, a Washington 
think tank. 

``There is a political element here, but I think it's also important to 
remember that these are much smaller countries than Russia and bringing them 
into the WTO is going to have a much smaller impact on the system than 
bringing Russia in,'' he said. 

Other Countries 

In addition to the former Soviet republics, Albania, China, Croatia, Jordan 
and Oman are also being targeted by the U.S. for entry by this November. 

Albania, which absorbed thousands of refugees during the NATO-led bombing 
campaign against Serbia, could be among the first new countries to gain 
membership. Rudina Mullahi, the commercial counselor for the Albanian embassy 
in Washington, said Albania and the U.S. are in the final stages of drafting 
an agreement that would lead to membership. 

Mike Hammer, a National Security Council spokesman, said the push to get 
Albania into the WTO is in part political. ``I think there's certainly a 
great awareness that there is a tremendous need to help the countries in the 
region,'' he said. ``This might be one way to do so,'' he said. Albania will 
still have to enter on ``sound economic merits,'' he said. 

******

#11
Moscow Times
August 11, 1999 
Wary Duma Expects To Confirm Putin Fast 
By Melissa Akin
Staff Writer

State Duma deputies, trickling back into Moscow for Vladimir Putin's 
confirmation hearings, said they would fast-track Putin into office in order 
to keep political peace as elections approach. 

Putin, nominated Monday by President Boris Yeltsin to replace Sergei 
Stepashin as prime minister, faces a confirmation vote in parliament's lower 
house Monday afternoon. Analysts said he would receive a safe, if not 
enthusiastic, majority of votes. 

"The Duma can support the candidacy [of Putin] because he is practically a 
continuation of Stepashin," Anatoly Lukyanov, a senior, mainstream Communist 
deputy, said in an interview with NTV television. "This is like a 
continuation of the vote [for Stepashin] and there will be no big display of 
emotions." 

Stepashin was mutely approved in May on a vote of 301 to 55 in the wake of a 
failed attempt to impeach Yeltsin. 

As a security services director known for his extreme loyalty to Duma bÐte 
noire Boris Yeltsin, Putin is not a popular figure with the parliament. 

But fearing that rumors that the president would like to dissolve parliament 
are true, legislators said their main interest lies in timely elections, not 
in a display of opposition to Yeltsin. 

Legislators widely believe that Yeltsin named an antipathetic figure in an 
attempt to draw their fire. If the Duma votes down Putin's candidacy three 
times, the president must disband the Duma and call new elections within 
three months. 

Alexander Veshnyakov, head of the Central Election Committee, warned that 
this could require the elections to be postponed. Yeltsin on Monday set Dec. 
19 as the date of Duma elections. 

"But I think that will not happen, because the State Duma understands the 
situation and will reach an agreement with the president at an earlier 
stage," Veshnyakov said at a news conference shown on television. 

Deputies are not going to risk losing their positions and privileges in the 
final months of the campaign, Vladimir Pribylovsky, a Duma specialist at the 
Panorama research group, said. 

"Putin, Rasputin - it doesn't matter," Pribylovsky said. "The main thing is 
to go into elections with an office, a telephone and a fax." 

Putin is seen as a tougher manager than his predecessor, who reportedly 
refused to go along with Kremlin schemes to manipulate elections. 

Viktor Ilyukhin, the leader of the Duma's radical left wing, said he feared 
Putin could take unconstitutional decisions such as canceling elections. 

"It scares me already," Ilyukhin said in a telephone interview. 

So far, only one group of legislators - Vladimir Zhirinovsky's Liberal 
Democratic Party, which rarely defies the president - has signaled its 
unconditional support. But almost all factions have indicated they will 
approve Putin for expediency's sake. Their official positions will be 
announced after faction meetings later this week and Monday. 

Putin, as a member of Our Home Is Russia, already has a power base in the 
Duma. After most Moscow media branded him a colorless, inexperienced 
politician, Our Home faction leader Vladimir Ryzhkov outed him as a member of 
the party leadership. 

"We have no reason to vote against a member of our own political council," 
Ryzhkov said on NTV. 

The Communists, their allies, the liberal Yabloko faction and the Russia's 
Regions group have all said they want the vote over quickly - statements read 
as a promise to vote Putin through. 

To avoid the appearance of collaboration with the Kremlin, the Communists 
have floated a vague threat to abstain from voting. But analysts said it was 
more likely that no faction would impose party discipline, letting each 
deputy vote his conscience and betting that would add up to a simple majority 
for Putin, as it did in the vote for Stepashin. 

Andrei Fyodorov, director of the Political Researchers' Foundation, said that 
an unpopular government during campaign season would likely help the 
Communists. "They can say, it's not our government and we don't want any 
responsibility for what they do. Putin as prime minister will bring the 
Communists millions of votes." 

******