August 29, 1999   
This Date's Issues: 3469 •3470 • 

Johnson's Russia List
#3469
29 August 1999
davidjohnson@erols.com

[Note from David Johnson:
1. The Guardian: Jonathan Steele, Relenting Russia sheds tears for ailing 
Raisa. The Gorbachevs are popular at last. 
2. Washington Post editorial: Mr. Gore's Russia Problem.
3. Reuters: IMF says Russia economy doing better than expected.
4. William Mandel: Re: 3468-Straus/US Supporting Break-up?
5. Wladislaw George Krasnow: Letter on "Russiagate"
6. The Russia Journal editorial: No ideology, no platforms.
7. Reuters: Russia celebrates 50 years of nuclear race.
8. THE JAMESTOWN FOUNDATION PRISM: Ilya Malyakin, GUBERNATORIAL ELECTION
BLOCS: 
RUSSIA WITHOUT MOSCOW OR MOSCOW WITHOUT RUSSIA?
9. Washington Post: Fred Hiatt, Stumbling in Russia.]

*******

#1
The Guardian (UK)
29 August 1999
[for personal use only]
Relenting Russia sheds tears for ailing Raisa 
The Gorbachevs are popular at last 
By Jonathan Steele, Moscow

Eight years after power slipped from Mikhail Gorbachev's hands and was picked 
up by Boris Yeltsin following the failed coup of August 1991, tens of 
thousands of Russians are finally saying sorry. 

The message is indirect, and comes in the form of sympathetic newspaper 
articles and sackfuls of letters which pour into the Gorbachev Foundation's 
Moscow office every day, offering sympathy for the ex-President's wife, 
Raisa, as she struggles for her life in a German hospital. 

Many contain gifts, ranging from herbal medicine from peasants in deepest 
Siberia to offers of money to help pay for treatment at the University Clinic 
in Münster. 'We even had an offer of $25,000 from the widow of an army 
colonel who had sold her large flat and moved to a smaller one,' says 
Vladimir Polyakov, the ex-President's press secretary. 

For years Gorbachev, though admired worldwide, has been reviled in his own 
country. Now people appear to have started a rethink. An article in the 
mass-circulation paper, *****Argumenty i Fakty, put it in emotive terms. 
'Mikhail Gorbachev never leaves his wife's bedside. It is painful to see him. 
This couple is clearly bound unbreakably by ties of absolute unity. They 
cannot live without each other. This used to irritate us, but now we 
recognise how good it is. It is never too late to admit one was wrong.' 

Another popular paper, Komsomolskaya Pravda, printed excerpts from memoirs by 
a student friend who recalled the couple's stormy love affair at Moscow 
University's Law Faculty. It carried a picture of a dashing Gorbachev wearing 
a 1950s trilby. Other papers used photos of middle-aged Gorbachev lost in 
devotion with his eyes closed as he kissed Raisa. 'As the days of Raisa's 
severe illness go on, the depth of her husband's love becomes more and more 
obvious,' said the strapline on the article. 

First hints of a shift came when the Gorbachev Foundation began to get odd 
phone-calls from the office of the Kremlin, wondering whether Gorbachev would 
welcome a message of support from Russia's President and, if so, how it 
should be sent. 

This was some days after messages from Bill Clinton and European leaders, but 
Yeltsin and Gorbachev had been at daggers drawn since 1987. If it were not 
for Yeltsin's anger and determination to get his revenge after he left the 
Soviet Politburo, many analysts think the Soviet Union might not have 
collapsed. Yeltsin used the platform of the Russian parliament to create a 
Russian presidency and then urge the other Soviet republics to break away, 
leaving Gorbachev with no country left to rule. Once on top in the Kremlin, 
Yeltsin cut all links with Gorbachev. 

In the end Yeltsin sent a telegram. 'It was the first contact we have had 
since 21 December 1991, four days before Gorbachev resigned,' says Polyakov. 
The four-sentence message says that Yeltsin was 'distressed to learn of the 
heavy ordeal which has befallen your family. At times like this, mutual 
support, warmth and understanding are indispensable. I wish you, Mikhail 
Sergeyevich, strength and determination, and for Raisa Maximovna 
steadfastness in her fight with her ailment and the speediest recovery, B. N. 
Yeltsin.' 

The immediate fallout from the Kremlin's change of heart came when Gorbachev 
asked his staff to approach the new Prime Minister, Vladimir Putin, for help 
in getting a passport for Raisa's sister, Ludmila, so that she could join her 
in Germany and be available as a bone marrow donor for Raisa. All queues were 
jumped. 

Ludmila is now in Münster but doctors are waiting for Raisa to recover 
strength before carrying out any transplant. It is too early to be sure her 
immune system could take new bone marrow. But the glimmer of hope has raised 
Gorbachev's mood. 

Quite why so many Russians are moved by Mrs Gorbachev's fight for life is not 
clear. The ex-President's press secretary believes it has been partly 
prompted by the terrible coincidence that a woman who has done so much to 
help leukaemia sufferers in Russia should so suddenly have been struck down 
by the disease. 

Using royalties from her husband's books she gave her first $100,000 to 
improve Russia's treatment of child leukaemia in 1990. Focusing on Russia's 
leading hospital for the disease, the Moscow Research Institute of Pediatric 
Haematology, she has given it almost $8 million to buy equipment and supplies 
and start a bone marrow transplant unit for children. 

Polyakov is sure the sympathy for the Gorbachevs has a political as well as a 
humanitarian side. 'People need a certain amount of time to evaluate the 
past, and make comparisons with what Gorbachev did and what has happened in 
the eight years since he left power. 

'He entered our lives so unexpectedly and when he left, almost as suddenly, 
people needed a scapegoat. But if it had not been for Gorbachev, Yeltsin 
would still be sitting in Sverdlovsk as the regional Communist Party 
secretary. And if Yeltsin had been elected General Secretary of the party in 
1985 instead of Gorbachev, no changes would have happened in Russia. 

'Now people are asking for forgiveness for not understanding that before.' 

******

#2
Washington Post
29 August 1999
Editorial
Mr. Gore's Russia Problem

A PREDICTABLE pattern attaches to efforts to influence political or economic 
change inside someone else's country. The would-be influencer -- whether the 
United States, the International Monetary Fund or the World Bank -- offers a 
range of goodies in exchange for the promise of reform. These reforms, facing 
internal opposition, are then only partially implemented. At that point, the 
would-be influencers must decide whether this partial accomplishment, along 
with the hope of further reform, justifies the distribution of the 
aforementioned goodies, with the attendant damage to future credibility. This 
is a dilemma that free-market advocates have faced in Indonesia, Egypt, 
Ukraine and Russia. It is the last case that is now emerging as an issue in 
the U.S. presidential campaign.

The dilemma in Russia has been particularly acute because it is a democracy. 
While President Boris Yeltsin could promise reforms, he could not implement 
most of them without the support of the Russian Duma -- and the Duma, or 
legislature, has for the most part fervently wished for the failure of reform 
and the failure of Mr. Yeltsin. In addition, Russia's nuclear arsenal and its 
sheer size astraddle two continents has left its officials confident that 
they will not be abandoned no matter how many promises they break. To 
complicate the picture further, the amounts that Western governments were 
willing to offer, while large, were not large enough to be decisive within 
the Russian political debate. The result has been many broken promises.

The Clinton administration nonetheless has consistently prodded the IMF to 
keep ladling out the goodies. Vice President Gore, who met regularly with 
Russia's prime minister, is particularly associated with that policy. With 
new allegations of Russian corruption and capital flight coming almost daily, 
Mr. Gore's rivals are asking what did he know, when did he know it -- and why 
did he not know more.

It's important first to delineate what any of us knows at this point -- to 
keep separate scandals separate. There is evidence, uncovered in part by The 
Post's David Hoffman, that the Central Bank misled the IMF about the extent 
and location of its reserves. Unrelated to that, at least so far, is a 
continuing investigation of huge sums of Russian cash moving through the Bank 
of New York in what is believed to have been a money-laundering operation. 
Yet a third inquiry is now lapping at the Kremlin walls, with allegations 
that Mr. Yeltsin's adult daughters and even the president himself may have 
received payments from a Swiss company that in turn received lucrative 
contracts to renovate Kremlin offices.

Each of these is serious, but -- especially in the second and third cases -- 
it is early to draw conclusions. What is clear, and has been clear for some 
time, is the high level of corruption in Mr. Yeltsin's entourage, broadly 
defined. In return for political support, the Yeltsin regime has given 
favored industrialists ownership of Russia's vast stores of natural resources.

The administration has not objected much to this practice. Was that a 
mistake? Should Mr. Gore have complained more strenuously about corruption in 
his meetings with the prime minister? Should he have pressed the IMF to walk 
away? These are fair questions, both for Mr. Gore's rivals in the campaign 
and undoubtedly for historians in future years.

But these historians will note that at no single point did Russia clearly 
abandon reform. Throughout this decade, it was making progress in some 
directions, backsliding in others, reaffirming promises that were in some 
cases fulfilled and in others abandoned. Historians also will have to 
evaluate the contention of some critics that the greatest U.S. sin, beginning 
with President Bush and continuing into Mr. Clinton's administration, was in 
offering too little help, not too much.

The premise of both administrations has been that Russia was too important to 
ignore, its potential failure too dangerous and its potential success too 
valuable to world order. The method of engagement can and should be 
questioned. But the underlying necessity to engage, it seems to us, remains 
beyond challenge. 

******

#3
IMF says Russia economy doing better than expected

JACKSON HOLE, Wyo., Aug 28 (Reuters) - Russia's battered economy is doing 
better than expected, but it is too early to say whether the nation will 
receive the second tranche of a much-needed international loan, a top 
International Monetary Fund official said on Saturday. 

``The macroeconomic situation is better than expected,'' Stanley Fischer, the 
fund's first deputy managing director, told Reuters on the sidelines of a 
high-level conference of central bankers and other finance officials in this 
Rocky Mountain resort. 

Russian officials have said repeatedly they expect the fund to disburse a 
second $640 million payment of an overall $4.5 billion IMF credit line by the 
end of next month. They have insisted that no IMF funds already paid to 
Russia have been diverted in an alleged Russian money-laundering scheme. 

A first $640 million tranche of the IMF loan, effectively aimed at rolling 
over Russia's debts to the fund, was paid last month but the money went 
straight into an account at the IMF and fund officials say the money will 
never actually reach Russia. 

Russia owed the fund some $17 billion before the latest loan was approved. It 
must repay $7.3 billion this year and next, as well as service billions of 
dollars in debts to other creditors. 

International accounting firm PriceWaterhouse Coopers, at the request of the 
IMF, has already completed two audits of how Russia used IMF funds. A third 
audit, dealing with funds channelled through certain subsidiaries of the 
Russian central bank, is expected to be completed and released publicly soon. 

IMF officials said on Friday they had no evidence that IMF cash had been 
caught up in the suspected money laundering scandal and vowed to back Russia 
as long as it showed a clear commitment to tackle its deep-seated economic 
problems. 

Fund representatives are currently in Moscow to look into whether Russia has 
complied with the terms of the credit agreement reached last month and the 
draft 2000 budget. 

``The mission has just started working and we can't really, at this stage, 
make any predictions about how it's going to turn out,'' Fischer said. 

****** 

#4
Date: Sat, 28 Aug 1999
From: William Mandel <wmmmandel@earthlink.net>
Subject: Re: 3468-Straus/US Supporting Break-up?

RE Straus and the break-up of Russia. Of course most Americans don't
want to see Russia break up, but what on earth do most Americans have to
do with what happens within the Washington Beltway, particularly at its
highest and most secretive and disingenuous levels? As to what will
happen in Russia, whether broken up or otherwise, we are witnessing the
collapse of a civilization. There was no one around to report on the
collapse of the ancient Cambodia of Angkor Wat, the Aztecs, the Mayans,
hardly even that of Egypt. Aren't we lucky? 

*******

#5
Date: Sat, 28 Aug 1999 
From: "Wladislaw George Krasnow, PhD" <wgkrasnow@rcn.com>
Organization: Russian American Goodwill Associates
Subject: Letter on "Russiagate"

David,

would you please post the following Letter to the Editor of The WP on
JRL. I submitted it last Thursday, today is Saturday. I am still hoping
for TWP audience. Perhaps, JRL audience will do. 

August 26, 1999
Letter to the Editor
The Washington Post
1150 15th St. NW
Washington, DC 20071

Dear Editor:

David Ignatius’s August 25 article "Who Robbed Russia?" was right on the
money. The answer is: the Russian oligarchs, mostly former Communist
nomenklatura members. But who set them up? The U.S. government did.

Ignatius cites recent "Russiagate" articles. John Lloyd writes in The
New York Times Magazine that President Boris Yeltsin whom "we in the
West supported, became worse than the Communists we helped him to
overthrow." Robert Kaiser of The Post quotes former U.S. diplomats in
Moscow to the effect that high U.S. officials, lead by Vice President
Albert Gore, ignored all information on the corruption of Russian
bureaucrats, as long as those swore by "reforms."

The U.S. promoted "privatization" in the name of market reforms. In
reality, Russia’s resources went to criminal money launderers.
Wittingly or not, the U.S. government became their accomplice. By
wasting billions of tax-payers’ dollars, the U.S. defeated the purpose
of its assistance to Russia. Ignatius is right that "the Clinton
administration squandered one of the most precious assets--the goodwill
of the Russian people."

Oh, were it only Russia! The United Nations report just released says
that post-Communist reforms have been calamitous for a vast swath of
Eastern Europe and Central Asia, leading to widespread poverty, alarming

falls in life expectancy, widening inequalities between the sexes,
falling investment in education, the collapse of public health and the
spread of disease, crime, and violence.

Perhaps, misery likes company. But, for the United States in the midst
of its economic boom, to emerge as the chief sponsor of misery in the
world is not only obscene. It defeats our national purpose.

W. George Krasnow
President
Russia & America Goodwill Association
Washington, D. C.

******

#6
www.russiajournal.com
The Russia Journal
August 30, 1999
Editorial
No ideology, no platforms

Sentimental music fades in as a voice reads poetry over pastoral shots of
the Russian countryside. Not what most expected from a political television
advertisement featuring ultranationalist Vladimir Zhirinovsky that appeared
earlier this year.

But then what else should one expect? Would-be young reformers' commercials
don't differ significantly. Indeed, messages of all political parties and
blocs - from reformers to extreme nationalists - are eerily similar.
As Russia prepares for parliamentary elections in December, there is one
conspicuous element lacking in the country's political discourse: issues.
Other politicians in other states may overdo what many would call the veneer
of electoral politics: staging debates, running television commercials and
going on the stump.

But in Russia, all that's missing.

Statements as to politicians' positions ahead of elections center solely
around one thing: their alliances with other politicians, businessmen,
regional lords or almost anyone that can deliver some votes.

With the exception of Grigory Yavlinsky's ostensibly liberal Yabloko party,
Russian parties have no economic agendas, no ideologies, and, consequently,
no platforms. No wonder most of them do not even call themselves political
parties - they are called blocs. The only thing bringing them together are
loose temporary coalitions formed in a run for power.

Such hedging will ensure that lobbies and vested interests will continue to
guide Russia's economic policies and that no real market reforms will occur
in the foreseeable future.

Western businesses that didn't pull out of the country after last year's
financial meltdown are waiting for one thing: stability. That will come in
the form of a Luzhkov-Primakov rule. Russia's much-awaited stability will
resemble that of the Brezhnev era. It will be a rule of the nomenklatura in
the name of capitalism-a-la-Russia, the 21st century model of communism. The
new nomenklatura and apparatchiki will be able to bring foreign investment
in and control exactly where it goes and who profits. A rule that will suit
even Western establishments.

In that, Russia will begin to approach (albeit from a different angle) the
Chinese model of capitalism, in which bureaucrats from varying hierarchical
levels have control over the economy and ensure that the top retains control
over a flowering and well-managed trade.

In Russia, much local control comes in the form of endless inspectors of all
stripes who have the power to shut down businesses and control ordinary
lives for the sake of any one point in a Byzantine web of regulations.
Primitive, but effective. Such is the stake of every local officer,
inspector, clerk and bureaucrat that they all become effective organs of an
oligarchic state to deliver civil peace and stability. Central power has
enough fingers in the pie, and does not usually interfere on their turf.
The new democratically chosen power politics and administration of Russia
will in fact bring in a system that has been perfected over the last 70
years

What kind of ideology supports such a system? None. Rather, ideologies serve
to obscure the workings of the system. For years, communist ideology, for
one, covered up a highly corrupt political and economic system. Similarly,
the perceived power of tsars over their "patrimonies" obscured the political
and economic influence of Russia's real political oligarchs: its nobility.
It hardly needs mentioning that "democracy" and "capitalism" now also hide a
corrupt reality in this county, one that involves almost all aspects of life
and segments of society.

Throughout Russian history, ideology has been used to hide informal
networks, the channels through which the country has been in fact
controlled. And it continues to do so in a big way.

Perhaps that's why political advertisements and campaigning in general stick
to broad notions of national pride and patriotism. On top of that, vague
promises and visions of grandeur and superpowerdom also allow politicians to
do nothing about the problems affecting most of Russian society - precisely
because those massive calamities contribute to the power and wealth of those
paying for the ads.

*******

#7
Russia celebrates 50 years of nuclear race
By Andrei Shukshin

SAROV, Russia, Aug 29 (Reuters) - In the early hours of the morning on August 
29, 1949, a dozen people gazed anxiously at cloudy skies stretching over a 
patch of desert steppe tucked away in a remote region of what was then the 
Soviet Union. 

Suddenly there was a flash of light, later described by one of the observers 
as ``five or six times brighter than the sun.'' Then the sky turned a 
brilliant yellow-red, and then a thumping roar was heard and a shockwave 
rippled over their heavily fortified bunker. 

The Soviet Union, struggling to catch up with the United States in the fight 
for world domination, had tested the RDS-1, its first nuclear bomb, and set 
off the most dangerous arms race in human history. 

Fifty years later, impoverished Russia is struggling to maintain its nuclear 
arsenal, but is commemorating those glory days in Sarov, the atomic bomb 
development centre about 400 kilometres (250 miles) east of Moscow that was 
so secret it until recently had no proper name at all. 

Yevgeny Vagin, who described the explosion, stood recently at the exhibition 
in a town seemingly frozen in time since the breakup of the Soviet Union and 
pointed to a faded sheet of paper hanging on a wall. 

``Today there are many people who say they witnessed it,'' he said. ``But I 
know for sure there was only a dozen of us, and they are all on this list.'' 

GULAG CHIEF PATRON SAINT OF THE SOVIET BOMB 

Pictures of the Soviet dictator Josef Stalin and the father of the GULAG 
concentration camps Lavrenty Beria are an unlikely sight at official events 
in today's Russia. But they open the Sarov exhibition because the two men are 
recognised as patrons of the bomb. 

Two models of early bombs, made to be shown to Stalin, are surrounded by the 
documents of a thriving industry hidden from view. 

Even typists at the forerunner of the KGB had not been let in on the secret, 
producing orders and documents with blanks which would later be filled in by 
hand with words like ``uranium,'' ``plutonium'' and ``explosion.'' 

Grey-haired, grey-suited researchers pride themselves on creating the Soviet 
nuclear shield, still hailed on billboards around town, and praise Beria and 
Stalin for launching the bomb programme and spending liberally on it. 

``The more we delve today in the documents of the time, the more respect we 
have for these wise men,'' said Anatoly Pelipenko, an official at the Sarov 
centre. 

Those days of plenty are gone for the scientists. Yuli Khariton, father of 
the bomb, died in 1996, bitter over the changed priorities of his country. 

Governor Ivan Sklyarov quoted him as saying: ``The nuclear bomb is like a 
gorgeous, capricious woman who loves men to spend money on her. Why have we 
come to treat her as an old prostitute nobody wants?'' 

VEIL OF SECRECY HID WEAKNESS 

The bomb was developed in Sarov, but the first mushroom cloud on the Soviet 
Union's horizon appeared thousands of kilometres (miles) away at a testing 
ground near the small Kazakhstan town of Semipalatinsk. 

Stalin initially hid his glee at ending the nuclear hegemony of his 
arch-rival, the United States. He denied U.S. president Harry Truman's claim 
that Moscow had tested its first bomb until months later, when a small Soviet 
arsenal was ready. 

After the test, the official news agency TASS said the Soviet Union had been 
engaged in large-scale construction work that required powerful explosions. 

Stalin had thrown money at the nuclear programme, but just four months before 
the test explosion researchers had been able only to produce nine grams of 
highly-enriched plutonium, the key component of the bomb. 

Scientists had been ordered to work quickly, but to set off a nuclear 
reaction they needed kilos of plutonium, not grams. 

Hundreds of thousands of people toiled away day and night at secret nuclear 
sites that had mushroomed across the Soviet Union since 1943, though only a 
handful of key researchers were aware of the final aim of the work being 
done. 

Vagin, an engineer who designed electric detonators for the first A-bomb, 
said that he started to realise what he had been working on just weeks before 
the test. 

``Of course, we did not know, nobody knew, and we never asked questions, just 
did what we were told,'' he said. 

Once, after Vagin was put in the know, he escorted parts of the bomb from 
production facilities to the testing ground on a closed train which swept 
through empty stations. 

``The train stopped only to get some water and check the wheels. There was 
not a soul on the platforms -- only the police, KGB officers and a team of 
railway workers who could not approach the train without a security guard,'' 
he said. 

Six months after the first test, in March 1950, the Soviet Union officially 
announced that it had tested the nuclear bomb. 

Its arsenal contained several battle-ready bombs and Moscow had decided it 
was strong enough to reveal the new menace. 

SPIES PART OF THE TEAM 

The nuclear test on August 29, 1949, came as a nasty surprise for the United 
States, which thought the war-ravaged Soviet Union would not be able to 
produce a bomb before 1952. 

Washington blamed a leak of secrets from its own research site in Los Alamos, 
a charge which the Soviet Union dismissed. 

But today Moscow does not deny that the success of its first nuclear 
experiment came as a result of team work -- and the team included 
intelligence officers, as well as researchers and engineers. 

The German-born nuclear scientist Klaus Fuchs, desperate to prevent the 
United States becoming the sole owner of the deadliest weapon ever, offered 
his services to Moscow in 1941 and soon began to pass on top secret data. 

``The materials I examined are of huge, invaluable importance for our state 
and science,'' Igor Kurchatov, head of the Soviet nuclear research, wrote by 
hand in a note released for the A-bomb anniversary. 

*******

#8
THE JAMESTOWN FOUNDATION
PRISM
A MONTHLY ON THE POST-SOVIET STATES
August 1999 No.15 Part 3

GUBERNATORIAL ELECTION BLOCS: RUSSIA WITHOUT MOSCOW OR MOSCOW WITHOUT RUSSIA?
By Ilya Malyakin
Ilya Malyakin is editor-in-chief for the Volga Information Agency.

Attempts by Russia's regional leaders to intervene in the activities of the
federal center and even to take control of it have already enjoyed a fairly
long history. Such attempts were impossible in the Soviet period and the
early stages of post-Soviet development, but after the subjects of the
federation adopted the system of electing presidents (in the national
autonomies) and then governors (in the krais and oblasts), they became a
visible, significant and legitimate phenomenon. Only now, however, on the
eve of the elections to the State Duma of the Russian Federation, have they
finally become open and public, furnished with the necessary institutions
and ideology. By this I mean the emergence on the political scene of the
Russia's Voice and All Russia electoral blocs.

The first major attempt by the regions to make their presence felt came
during the crisis in the autumn of 1993. During the first few days of that
crisis most provincial leaders expressed a relatively clear desire not to
participate in the formation of "support groups" for the president and the
Supreme Soviet of the Russian Federation, but to distance themselves as much
as possible from what was happening in Moscow, leaving the rival groups to
resolve the conflict themselves. Against the background of this extended
waiting game, Boris Nemtsov, then governor of Nizhny Novgorod Oblast, came
up with a startling initiative, proposing as a compromise solution that the
president and parliament should both resign simultaneously, transferring all
powers for the transition period--until new elections could be held--to the
council of governors. At that stage, however, provincial leaders were not
yet ready to back up their bid for serious powers with real action:
Nemtsov's proposal was not based on the firm position of the majority of
them, who were given their posts not through the ballot box but by the
president.

It was a completely different picture almost exactly five years later, in
August 1998, during another crisis of authority in Russia, not as drastic as
that of 1993, but no less dramatic in its own way. Following the dismissal
of Kirienko's government, against a background of direct confrontation
between Boris Yeltsin and the State Duma--both of whom were for an extended
period completely unable and unwilling to seek even a semblance of a
compromise--the issue of redistribution of power reared its head once again,
this time in a decidedly non-rhetorical manner. As mentioned, the government
had ceased to exist in its previous form, and the prospects of forming a
new, stable cabinet seemed rather unlikely. The president's authority was to
some extent paralyzed by the conflict with the Duma and the threat of the
initiation of impeachment proceedings; the Duma, in turn, faced the threat
of dissolution. It was against this background that the role of the
governors rapidly began to develop. This time there was no need for anyone
to propose the institutional legalization of this process. This had, in
effect, already occurred much earlier, when the decision was taken to form
the Federation Council made up of regional leaders. It was this body that
for a while became the focus of stable state power in August-September 1998.
The creation of the Federation Council was not the only factor which
significantly altered the situation in 1998, compared to 1993. Two more
interrelated changes had occurred. First, in 1993 and for some time
afterwards, the subjects of the Russian Federation were divided into two
unequal categories. National autonomies were in a far more privileged
position than oblasts: They were able to elect their own organs of power,
adopt their own constitutions and sign treaties with Moscow on the
distribution of powers and jurisdiction. Meanwhile, second, the
administration heads of most oblasts were unelected, appointed figures
directly dependent on the Russian president, who had the power to remove any
of them at any time, and indeed used this power on more than one occasion.

However, after October 1996, elections for administration heads were held in
all subjects of the Federation, and these striking differences between the
oblasts and republics of the Russian Federation quickly began to erode.
Before this, there had been frequent discussions in Russian politics about
the need to eradicate the inequality between oblasts and republics by
curtailing the rights of the latter, but it is interesting to note that such
talk now quickly petered out of its own accord. The real reason for this
change became very clear by 1997, when it transpired that equality between
the subjects of the Russian Federation was indeed being established, but
this was happening spontaneously, with minimal input and practically no
control on the part of the federal Center: It was taking place through the
efforts of the governors alone. Naturally, therefore, the idea that the
powers of the republican authorities should be curtailed was not even
entertained. The process was moving in the exactly the opposite
direction--towards extending the powers of the oblast organs to match those
of the republics. By 1998 the process had been completed almost everywhere.
In a significant number of federation subjects the local authorities had
even managed to take control of most of the federal structures on their
territories, but even this did not prompt the center to attempt to exert an
active and intelligent influence on what was happening. The impression was
that Moscow had parted with the regions entirely, granting them the
right--in exchange for a modicum of loyalty--to undertake all sorts of
social experiments, to establish the most unusual political and economic
systems and even to venture within "reasonable" limits beyond the bounds of
current legislation.

In the context of all the above, the next step taken by the regional leaders
seems entirely logical. By now they were persuaded that the center would do
nothing to counter their ambitions to extend to the maximum their powers in
the territories they controlled, and that the center did not in fact have
the real ability to do so. The regions now began "marching on Moscow,"
openly intending not just to reduce to a minimum their dependence on the
capital, but also to create organs of federal state power under their own
control. With an excellent springboard in the form of the upper house of
parliament, the regions--equally logically--launched their main offensive
against the lower house. (Their prospects for "taking" the presidency are
not yet backed up by the existence of a single candidate, or at least one
supported by an overall majority, and in any case it would be impossible to
make a move on the government without control of the Duma.) One of the main
consequences of this new trend has been the formation of two relatively
well-known electoral organizations, mentioned above: Russia's Voice, led by
Konstantin Titov, and All Russia, headed by Mintimer Shaimiev. This process
was mirrored by the creation of Fatherland, led by Moscow mayor Yuri
Luzhkov, and the "new regionalization" of Our Home is Russia (ROH), which
took place after Viktor Chernomyrdin's dismissal as prime minister. It is
these four forces which now dominate the regional "political market,"
claiming to reflect the interests of the subjects of the federation.

At present Fatherland and All Russia seem to be in the strongest position.
The former has the greatest representation in the provinces thus far,
enjoying the support mainly of the "weak" and "average strength" governors
who do not yet feel ready to enter the political fray independently or who
have not yet defined their interests at a federal level. There are
exceptions, however. Fatherland has the support of such strong regional
leaders as Ivan Sklyarov (Nizhny Novgorod Oblast), Vitaly Mukha (Novosibirsk
Oblast) and a number of others. Their decision to back Luzhkov is apparently
linked in many ways to the fact that they missed the allocation of leading
positions in the All Russia bloc, particularly, and for Sklyarov the
decision is probably also related to his struggle for domination in the
Volga region (by entering any of the other blocs he would have had to
concede the leadership to his neighbors--either Shaimiev or Titov, or to the
deputy chairman of ROH, Saratov Oblast Governor Dmitry Ayatskov). However,
Fatherland cannot really be considered a fully "gubernatorial bloc": It
retains all the hallmarks, typical for contemporary Russia, of a centralized
party structure created to further the interests not so much of various
regions, but rather of a particular Moscow politician--Yuri Luzhkov. To all
appearances, the governors joining the block are banking not so much on
preserving and strengthening their current position, but rather on the
potential future political dividends from Fatherland's success at the
elections to the Duma and Luzhkov's election as president. If this were to
happen, their support is likely to be rewarded.

On the other hand, some of the governors who officially support Fatherland
are avoiding putting all their eggs in one basket. In many officially
Luzhkov-supporting regions, organizations from All Russia or Russia's Voice
are active, and are even led by people close to the regional leaders.
However, this tendency is universal--governors and presidential teams in all
subjects of the Russian federation attempt to maintain good relations with
several blocs at once, regardless of the officially declared allegiance of
their leaders. Thus the head of Khabarovsk krai Viktor Ishaev is playing a
rather complex political game, maneuvering between Fatherland and ROH, while
in Komi Republic the regional leaderships of these two blocs have been taken
by the two first deputies of the head of the local executive.

The All Russia bloc may be considered the second most significant political
organization working with the regions, and it quite unequivocally claims to
reflect the interests of the regional elites. This organization was created
entirely outside Moscow--which fact alone places it in opposition to the
federal center--and consists in the first place of leaders of subjects of
the federation which have managed to acquire "special status" within the
Russian Federation, whether formally or informally, and of certain
economically powerful regions such as St. Petersburg, Bashkortostan and
Tatarstan. Unlike Fatherland, All Russia is tied neither to a particular
political figure nor even to a concrete program. It should not be forgotten
that the political organization supported by the governor--whether it is
ROH, Fatherland or Russia's Voice--quickly becomes the regional "party of
power" almost everywhere. However, the case of All Russia is a little
different. This organization has been joined mainly by established and well
structured (albeit with no previous official status) regional "parties of
power", each of which is geared towards supporting its own leader, and which
have reached a compromise thanks to their common desire to achieve greater
powers for the regions at the expense of the Center and to their willingness
to assume such powers themselves. Symptomatic of this is the fact that the
All Russia structures in each of the federation subjects involved in this
organization are practically autonomous and even have slightly different
names. Thus the Tatarstan branch is called "Tatarstan--21st century", the
Perm oblast branch is called "Prikam'e--21st century" and so on.
Furthermore, their founders do not hide the fact that this
institutionalization of regional parties of power is dictated by the desire
not just to prepare for the federal elections, but also to ensure as
effective a solution as possible for the problems related to running
election campaigns within the regions--above all to reduce to a minimum the
chances of a "random" election result.

Much weaker is the Russia's Voice bloc, which announced its inception almost
before all the others but which is on a markedly smaller scale. Essentially
it has a great deal in common with All Russia, but it has managed to unite
far fewer federation subjects, and its team appears much weaker than those
of its opponents. This is not really surprising: Whereas Fatherland is
united around a future presidential candidate and All Russia is based on
common interests in the "center versus the regions" confrontation, the
emergence of Russia's Voice was in many ways dictated by the personal
interests of a particular regional leader. He may be quite a strong leader,
but cannot compare to Luzhkov in terms of his influence or the level of his
aspirations. Of course, in creating this bloc, Samara Governor Konstantin
Titov once again demonstrated his ability to be an interregional leader,
edging out others hopeful of assuming a dominant position in the Volga
region--particularly Saratov Governor Dmitry Ayatskov. However, this was
where his success ended: In competition with Fatherland and All Russia,
Russia's Voice, focusing on a single but peripheral leader, has almost no
chance either of attracting new subjects of the federation into its sphere
of influence, nor of gaining political authority. At the same time, it is
its isolation which has to a significant extent reduced the chances of the
Russian provinces of securing even a partial "victory over Moscow" at the
forthcoming elections, creating another split in the ranks of the provincial
elite.

Finally, Russia is Our Home claims to have some influence among the
governors. However, these claims are largely unfounded and are of a somewhat
passive nature. After Chernomyrdin's removal from the post of prime minister
there was a rapid breakdown in the organizational structure of ROH. To a
large extent the existence of the three political movements described above
is due to ROH, particularly the existence of Fatherland, which many
governors originally took to be ROH's successor as the federal party of
power. However, the movement now very much appears to be the outsider in
comparison with its rivals. Nevertheless, it does have something in reserve:
In drawing up the party list for the elections, consideration was given to
the inclusion among the top three names of one of three influential
governors who still support ROH. The names involved are indeed very well
known: Dmitry Ayatskov, Viktor Ishaev and Mikhail Prusak (though Ishaev, as
mentioned above, is inclining towards cooperation with Fatherland and thus
appears to be the weak link in this chain).

It is clear that of these four organizations, only Fatherland has the
undoubted ability, independently and with no allies, to garner the 5 percent
of the vote required for the party lists and to secure seats for a large
number of its deputies from single mandate constituencies. For the others
the prospects for forming their own factions in the Russian parliament look
highly dubious. For this reason, for as long as Russia's Voice and All
Russia have existed, analysts and journalists expected them to move towards
resolving this problem, particularly in the direction of bloc politics.
Fatherland was seen as the most favorable coalition partner for them.
Russia's Voice, however, totally rejected the idea of union with Fatherland
and entered into a coalition with Chubais' Right Cause and Kirienko's New
Force.

Although the choice of allies made by Russia's Voice seems rather
paradoxical if we recall that the liberal movements suffered a total defeat
at the last elections and their popularity has hardly increased since then,
its behavior is in fact quite comprehensible and justifiable. The fact of
the matter is that Fatherland, which is foisting itself upon the governors
as an ally, is in fact not their ally at all. In his style of behavior, his
personal mythology, his management methods and many other features, Luzhkov
undoubtedly appears to be close to the governors, but some qualification is
required: His aspirations apply not just to the federation subject which he
heads--Moscow--but to the whole country, and the logical implementation of
these aspirations must inevitably lead not to the extension of powers for
the regions--far from it--but to a very significant restriction of them.

Some governors have taken decisions on forming electoral alliances in their
own regions without waiting for official sanction from the "party
leadership". Their decisions have been as a rule rather uniform, but
effective--the governors attempt to unite all the local structures of the
four political organizations under their leadership and to make them work as
one team. This is what happened, for example, in Orel Oblast, where
Fatherland became the focus of the alliance; the situation in Perm Oblast is
heading in the same direction, but under the umbrella of All Russia. Thus
the agreement recently made between Fatherland and All Russia will probably
be not so much a union as a division of spheres of influence.

Thus the situation in which the provincial political elites find themselves
on the eve of the elections to the State Duma is characterized by two
circumstances. The first of these is a general increase in the aspirations
of these elites to control the activity of the federal organs of power, and
the second is the emergence of a new fault line between the subjects of the
Russian Federation: Not only along the traditional lines of sympathy with
the "communists" or the "democrats", but along the lines of the allegiance
of the governor's team to the "regionalists" or the "federalists."
Furthermore the focal point for the federalists is typically provided not by
the current federal power structures, which are clearly unable to withstand
attack from the regions, but by the "future" structures, represented by the
team of one of the main candidates for the next president of the Russian
Federation. The second circumstance is the more important here, given that
the events it generates on a federal scale are in a way a model for future
development.

******

#9
Washington Post
29 August 1999
[for personal use only]
Stumbling in Russia
By Fred Hiatt
The writer is a member of the editorial page staff. 

The debate over who lost Russia is legitimate and even necessary, as long as 
it's understood that Russia is not lost and was in any case never ours to 
lose. But the debate can be useful only if it's historically honest -- about 
Russia's initial handicaps, about its prospects, about how much worse things 
might be.

The coming presidential elections both here and in Moscow are one spur to the 
recent flaring of the debate. Another is this autumn's 10th anniversary of 
the fall of the Berlin Wall -- a logical moment to examine the gains and 
shortfalls of a decade of post-Communism. But the most urgent cause is simple 
disappointment, here and in Russia, in how things have turned out -- in 
continuing poverty, declining lifespans, malign instability, sickening 
corruption and ruthless robber barons masquerading as reformers.

All this is a long way from the prosperous, capitalist democracy that a 
younger and healthier Boris Yeltsin pledged to deliver within six months of 
taking power at the start of 1992.

Many critics have coalesced on the basic reasons for his failure. Yeltsin and 
his reformers, it is said, erred by privatizing state-owned property and 
promoting democratic reform too soon, before they had put in place the legal 
and regulatory structure needed to make democracy and capitalism function 
properly. The Clinton administration abetted this mistake, according to the 
critics, by averting its gaze from Russia's problems and funneling aid even 
when official corruption became evident.

There is much truth in these criticisms. Certainly, things would have turned 
out better if Russia had established an honest judicial system, a reliable 
securities and exchange commission, functioning bankruptcy courts and an 
impartial election commission before embarking on its great experiment.

But who would have built such institutions? Who would have staffed them? What 
political force would have supported their creation? Unlike in Poland, say, 
or the Czech Republic or Estonia, countries where Communists had been in 
power for less time, there was in Russia no consensus supporting such change. 
Yeltsin's reformers, or at least some of them, understood the need for such 
institutions. They also knew that they were not going to emerge, full-grown, 
from the Soviet ruins.

So they took a calculated gamble -- a conscious, witting gamble. Inheriting a 
failed and bankrupt state, they decided to put as much property into private 
hands as quickly as possible, hoping that the new propertied classes would 
then become a political force for a rule of law. Even those with ill-gotten 
gains, it was hoped, would eventually see the merits of a judicial system to 
protect those gains.

This guaranteed a high level of cynicism among those who fared poorly in the 
initial scramble for property. Nor was there any guarantee that society would 
recover from the corruption that was tolerated and even encouraged. Looking 
today at the results, the gamble doesn't look good. But it's too soon to know 
whether it will ultimately pay off. Critics may fairly speculate that it will 
not, but they should also then explain what alternatives were open to the 
reformers in the early days.

We have, after all, models within the Soviet Union of the alternative 
strategy. In Uzbekistan and Kazakhstan and Turkmenistan, post-Communist 
leaders promised gradual reform, postponing full democratization and 
privatization until appropriate institutions were in place. The result: 
continued despotism, little reform and easily as much poverty and corruption 
as in Russia. Without democratic pressure, the promised gradual changes 
simply have not come.

Was the Clinton administration guilty of wishful thinking? Absolutely. Every 
Russia-watcher has his favorite example; to my mind, the basest moment came 
when President Clinton appeared to endorse Yeltsin's brutal war in Chechnya 
by comparing the Russian president to Abraham Lincoln fighting to preserve 
the Union.

But the administration was not blind to Yeltsin's erratic behavior or the 
shortfalls of reform. In supporting IMF loans it took a calculated risk. On 
the one hand, much of the money might be wasted or even stolen. On the other, 
it might buy some time for Russia's democratic experiment. If the critics 
think it would have been wiser to write Yeltsin off, to allow or even 
encourage the Communists to reoccupy the Kremlin -- well, that's not an 
outlandish position; maybe Russia would be better off today under Zyuganov or 
Zhirinovsky. But those who believe so should explain why.

Small comfort though it is to Russians, it is also worth remembering that 
things could be worse. Yes, many Russians are poorer today than in Soviet 
times. But, as anyone knows who's been stuck in Moscow traffic, many are 
better off.

Most of those who have prospered, moreover, are not crooks. They are young 
people who have enjoyed a decade of remarkable freedom in which to make their 
fortune and shape their own lives. Only when that generation comes to power 
will we know for sure whether Russia is lost.

******