Center for Defense Information
Research Topics
CDI Library
What's New
CDI Library > Johnson's Russia List

Johnson's Russia List


December 10, 1999    
This Date's Issues: 3672 3673   3673

Johnson's Russia List
10 December 1999

[Note from David Johnson:
1. Ed Dolan: Yeltsin shaky.
2. Reuters: Dangers lurk for Russian army in Chechnya.
3. The Moscow Tribune: John Helmer, THE NAKED TRUTH -- YOU'VE NOTHING TO 

5. Itar-Tass: Kremlin Vows Support for Yedinsto Group -Shabdurasulov.
6. Trud: Trust Only Actions. (re Fatherland)
7. John Danzer: Who Will Replace Putin?
8. New York Times editorial: Ending the Brutality in Chechnya.
9. Los Angeles Times: Mark Kramer, The West Should Stand Up for Chechnya. 
World politics: Russia must get the message that its relations with the U.S. 
and its allies will suffer if the slaughter continues. 

10. The Times (UK): Giles Whittell, Yeltsins 'spent $87,000 on credit 

11. Foreign Policy: Danile Treisman, After Yeltsin Comes ... Yeltsin.
13. Reuters: U.S. wants good ties with Russia despite spy flap.

15. AP: Russia Promises Lawful Elections. 

DJ: Permit me a few candid remarks. It's easy to lose focus on the essentials 
of the Russian situation. Let me state them bluntly as I seem them:
1. The war in Chechnya was manufactured to save the Yeltsin regime. 
2. It's likely architects are an evolved amalgam of the same coalition of 
clever oligarchs and clever young reformers who collaborated with Yeltsin 
last time. The names of Berezovsky and Chubais come to mind.
3. US policy makers vis-a-vis Russia remain commited to sustaining the 
Yeltsin regime (without Yeltsin) and admit few mistakes in their past 
performance. The only mistakes were being "too optimistic" and underestimating
how defective the Russian material is. The "masters of the universe" 
mentality that unites those inside the two beltways remains.
4. Even with all its defects the perceived alternatives to continuity are 
feared more than the continuation of what's been created. The red-brown
bogeyman lives.
5. Fine sounding words mask the harsher judgements. 
6. Everything is more complicated in the real world but these essential 
points are valid.]


Date: Thu, 09 Dec 1999 
From: Ed Dolan <>
Subject: Yeltsin shaky

Mike Collett-White, writing for Reuters (JRL 3670) reports that Yeltsin was
"shaky" at the Belarus signing ceremony. Actually, that's a bit of an
understatement. It would be more accurate to say that he appeared completely
confused and disoriented. The NTV footage of the incident as broadcast on
the 10 pm news was interesting enough to be worth sharing with JRL readers
who didn't catch it, especially since unedited footage of Yeltsin in a
situation that is not fully stage-managed is becoming more and more of a
rarity on Russian TV.

The camera shows the signing ceremony, with Lukashenko and Yeltsin at the
head table. Yeltsin is reading from a small briefing book, which appears to
consist of a typed text slipped into plastic protectors that are bound
together with a spiral binding, at most four or five pages. The NTV
commentator breaks in with an overvoice to comment that "The president
thought the last paragraph of the speech was so important that he read it
twice, to give it special weight." 

The sound switches back to Yeltsin, who finishes reading the final
paragraph. He then stops speaking and turns the page, seeming to look for
more, and not finding it. He starts to fumble back through the pages, and
appears to be trying to pull one of the sheets out from its plastic
protector. He leans to his right, toward Lukashenko, who reaches out a hand
to steady him. Yeltsin, in an audible whisper, says "Is this the end, or
what?" Lukashenko, and then an aide off camera to the other side of Yeltsin
make inaudible remarks. Yeltsin continues to fumble. The aide stands up,
helps him straighten out the pages, and whispers something else. Yeltsin
brushes the aide away, seems to find his place, reads the final paragraph a
second time, and sits down. The gap between the first and second readings of
the final paragraph is about 20 seconds.


ANALYSIS-Dangers lurk for Russian army in Chechnya
By Mike Collett-White

MOSCOW, Dec 9 (Reuters) - Russian generals masterminding the military 
campaign in the breakaway region of Chechnya may be pinching themselves in 
disbelief at the quick pace of their advance across the lowlands to the 
besieged capital of Grozny. 

They were close to winning complete control of Chechnya's central heartland 
on Thursday as they launched an operation to take Shali, 20 km (12 miles) 
southeast of Grozny. It was the last separatist-held town outside the 

Army losses since the campaign began were put at just 261 - a fraction of the 
thousands killed during the early months of the 1994-1996 conflict there. 
This time around, they even have the support of the Russian public at home. 

But any plans for a victory celebration would be premature, defence experts 
warned on Thursday, adding that dangers lurked on a number of fronts for the 
army of up to 100,000 troops. 

``I think what the Russians have really got to be worried about in the long 
run is that once the Chechens can no longer fight them face-to-face, they 
will turn to terrorism,'' said Anatol Lieven of the London-based 
International Institute for Strategic Studies. 

Alexander Golts, a leading defence analyst and correspondent for the weekly 
Itogi magazine, agreed, saying that even if armed rebels, dubbed 
``international terrorists'' by Moscow, are driven into the southern 
mountains, a long guerilla war could follow. 

``There was a similar situation in January 1996 when the fighters were 
flushed out of towns in the destroyed part of Chechnya, but then began a 
partisan war, during which the army found it very difficult to do anything,'' 
he said. 


Military analysts said Russia had learnt important lessons from the 1994-1996 
campaign, which ended in heavy losses and ignominious defeat. One was the 
``safety in numbers'' theory. 

``There are up to 100,000 troops on the Russian side, and this is one of the 
reasons for the success of the war so far,'' Golts said. ``Last time they had 
no more than 30,000.'' 

Moscow also appears to have taken a few tips from Western military operations 
in Iraq and Kosovo by softening up targets with relentless bombings from the 
air and ground. 

And a decision to release convicted embezzler Bislan Gantamirov from a 
Russian prison to lead a pro-Moscow militia in Chechnya has paid early 
dividends, after his involvement in the fall of Urus-Martan on Wednesday. 

But blunting euphoria in Moscow is uncertainty over the fate of Grozny 

The fact that so many towns surrounding the besieged city have fallen without 
serious resistance could point to a concentration of rebel forces in Grozny 
itself, analysts said. 

While all the roads leading to the capital are under Russian control, Chechen 
fighters are believed to be able to sneak through enemy lines without much 

Yevgeny Volk of the Moscow-based Heritage Foundation said that freeing Grozny 
of rebels may involve the kind of ground assault which Russian generals have 
avoided so far to keep losses down. 

``There are well-defended areas which are impossible to take only with air 
and artillery bombardment,'' he said. ``Any major ground operation will lead 
to major losses on the Russian side. I think the fight around Grozny could go 
on for a long time.'' 


Even if Grozny does fall, a long period of guerrilla warfare looms. 

Golts said the rebels could hide up in the mountains to the south of the 
region bordering Georgia, while Lieven added that even without a base they 
could launch a long campaign of terror against Russia in the war-scarred 

``People could be obedient citizens working with the authorities during the 
day time and at night step out with machine guns and shoot at the security 
forces,'' Volk said. 

Some specialists said a long, low-level confrontation may be a price Russia 
is willing to pay to rid Chechnya of its more notorious warlords and the bulk 
of the rebel forces. They are estimated by Golts to number around 6,000 in 

It may have no choice, since negotiating a peace agreement is fraught with 

The Kremlin has refused to sit at the same table as Chechen leader Aslan 
Maskhadov, who it says does not control the whole of the territory and has 
not distanced himself sufficiently from the rebels fighting against Russian 


Date: Thu, 09 Dec 1999 
From: (John Helmer) 

>From The Moscow Tribune, December 10, 1999
John Helmer

Late on Saturday evenings, one of Moscow's television channels 
presents a bulletin of news called "The Naked Truth".

An attractive woman in professional garb sits behind a studio desk, and reads 
the news from a teleprompter. A small screen opens up on her left, which runs 
footage to illustrate the story she is telling.

At the same time as she reads, however, the news reader's hands start 
to do things you've never seen on the regular news broadcasts. While the 
footage shows the latest artillery barrage from the 
front-line in Chechnya, the reader lifts her legs, and puts on sheer black
stockings. When the script and the mini-screen report the last 
session of Prime Minister Putin with his ministers, the news anchor's 
fingers are unhooking her blouse. By the time, the campaign trail items give 
way to the sports results, the small screen has become a distraction. The 
reader has removed her blouse and bra, and her legs are on the desk in a 
seductive pose. You know, if there is to be a late-breaking bulletin on 
Yeltsin's health, you are going to see right where her short skirt used to be.

The weather forecast is even more lubricious. Another attractive woman dances
slowly in front of continental Russia's highs and lows. Her pink negligee
reveals breasts roughly where Vorkuta should be registering minus 30
degrees. A tiny black g-string sways in front of the moist warm front over

I don't know if the station manager thought up the presentation to give
viewers, jaded by the repetitive, mind-numbing propaganda from Chechnya,
the Kremlin, Washington, and the campaign trail, a reason not to flick the

A hackneyed trick, I know, but one the politicians responsible for the tedium 
could play themselves.

Imagine that instead of speaking to a group of erstwhile intellectuals at the 
PEN Club, Putin started to slip out of his shirt and socks. The distraction 
ought to be great enough to divert from his answer to the question, What
is going to happen to Russia, and what will you do about it? Putin's
reply was that he doesn't know what lies ahead, but he will try his best.
A little more nakedness might have covered up that empty truth.

Imagine Yevgeny Primakov or Yury Luzhkov or Gennady Zyuganov rocking to a 
Russian tango as they ease out of their braces, or unslip their belts, while
they tell Russian voters what exactly they plan to do to recover the
bank deposits stolen from SBS-Agro. Millions of voters have hundreds of 
millions of dollars at stake. It is the local court judges and bailiffs
of Moscow, reporting to the Mayor, who have it within their power to impose 
penalties, as well as payment and seizure orders on the bank. If the 
candidates had their hands in front of their privates, the voters might
momentarily fail to notice that they haven't said a word about the bank
larceny, who caused it, and what can be done about it.

Early this week, Sergei Stepashin, running with Yabloko, was asked what he 
would do for the cheated bank depositors. His answer might better have been
concealed by an intimate glimpse of soft white skin. "Adopt a law on 
protecting bank deposits, and make this work," he said, omitting to mention 
the role he knows the Kremlin, the Finance Ministry, and the Central Bank 
have played in stripping this year's banking legislation of all practical 

Imagine Irina Khakamada and Boris Nemtsov, dressed in black tie-and-tails 
doing a transsexual routine from "Cabaret", while they explain what Sergei 
Kirienko and Anatoly Chubais propose to do to halt corruption of high 
officials, and which officials they would start with. Is she, or is he? the 
crowd would tantalize themselves by asking instead, as they waited for the
trousers to drop.

The election campaign is more than a striptease, though. By the time you 
realize there is nothing there to see, it's too late. The show's over, and 
the ticket to your seat has been sold to someone else.


Vremya MN
December 6, 1999
[translation for RIA Novosti for personal use only]
By Dr. Nikolai POPOV (History), social scientist

Do you think some situations in the country call for a
strong and powerful leader, the "iron hand"?
1. Our people always need an "iron hand" 45%
2. Power should be concentrated in one pair of hands now 27%
3. No one man must hold all power 17%
4. Difficult to say 11%

The latest ARPI polls show that 45% of the respondents
always need an "iron hand," while 27% think power should be
concentrated in one pair of hands now. Not that the people's
striving for an "iron hand" has grown of late. In fact, it never
diminished. The need for such rule has become a genetic demand
since the period of monarchy. And the subsequent 80 years of
dictatorship distorted the people's mind, creating the
subconscious need for a strong and unshakeable power. It has
smoothly passed over into the modern period and was inherited by
the existing political culture.
This does not mean that the people want dictatorship. The
shocks of the 1930s, with bloodshed, persecution campaigns and
executions, are long in the past, and most people associate
socialism with the 1960s and 1970s, when there was no executions
but there was order and steadfast government in the country.
The 72% who would like to have an "iron hand" at the top are
divided into two groups. The clear but stable minority (5-7%)
think Stalin was a great man who created a great state, and we
need a man like him today. But the bulk of this group (and the
bulk of Russian citizens as a whole) need an "iron hand" for a
return to a planned economy and state regulation, if not
socialism. The recent ARPI poll shows that 42% of the respondents
would like the privatisation results to be reviewed. In other
words, they want the revival of state ownership of everything in
this country. They are pining for centralised, authoritarian
rule, with limits put on some freedoms and with reliance on the
law-enforcement structures. This mood persisted throughout
perestroika, but the people did not tend to speak their mind.
They kept silent, but clearly protested against the developments
in the economy and state management.
Putin has made an impression on the Russian people exactly
because he corresponds to their view of power, which they think
must be resolute, self-assured, without any doubts. The current
premier has (or seems to have) these qualities. And not only
because of what he does in Chechnya, although it is important,
too. The syndrome of the lost war poisoned the minds of the
people and depleted their national dignity. The current mass
support for the military operation in the Caucasus mirrors this
mood, but the people think we need an "iron hand" to win this
second Chechen war.
A new generation must grow and live in a democratic society
for at least ten years, absorbing its values and notions, for us
to get rid of the need for authoritarian power. But we have
actually not lived in conditions of genuine democracy yet. The
middle 1980s were the euphoric period, with the freedom fever and
individual victories. But we have not built a new society yet.
And so we continue to live in this strange, pseudo-democratic
space, with its many vices. 


Kremlin Vows Support for Yedinsto Group -Shabdurasulov.

CHELYABINSK, December 9 (Itar-Tass) - With the election date being only ten 
days away, the election campaign has reached its boiling point, presidential 
first deputy chief of staff Igor Shabdurasulov said at a news conference in 
Chelyabinsk on Thursday. 

Asked about the Kremlin's attitude towards the various participants in the 
upcoming election campaign, Shabdurasulov said it supported a number of 
movements, including Fatherland-All Russia (OVR), Our Home Is Russia (NDR), 
the Yabloko liberal democrats and ,of course, Yedinstov (the Unity). The 
Yedinstvo group, comprising regional governors, has been supporting the 
government of Prime Minister Vladimir Putin straight from the campaign's 
outstart and has announced the intention to set up a Duma coalition to back 
him in parliament. 

"We have no right to wage a campaign in favour or against any bloc, but we do 
have a right to approve of its activities, and so will we do," Shabdurasulov 
went on to say. 

He noted the Kremlin regarded the Communist Party of Russia more as a 
political opponent than an enemy or rival. "But we will not keep silent if 
someone from the Communist Party or Fatherland-All Russia (OVR) throws 
insults at the Russian president," Shabdurasulov stressed. 

He was also categorically against changing the election date. fil/ 


Russia Today press summaries
9 December 1999
Trust Only Actions
Georgy Boos, campaign manager of the Fatherland ­ All Russia (OVR) election 
bloc, visited the city of Volgograd, where he had meetings with veterans, 
students, journalists, and others.

The city of Volgograd, just like many other Russian cities, has many problems 
and difficulties. The Volgograd region is supposed to be “red” ­ supporting 
the Communists ­ which is why the political leaders who are for reform and 
democratic principles are very much criticized here.

Each audience asked Georgy Boos questions about American businessman Paul 
Tatum’s murder and the “multi-million dollar fortune” of Moscow Mayor 
Luzhkov. At Volgograd University and in the famous tractor factory, Boos 
patiently explained, “I don’t think that any of you believed that the owner 
of Slavyanskaya hotel, after he was hit by 14 bullets from a Kalashnikov 
machine gun, three of which hit his head, was able to make any statements. 
It’s obvious that all of this isn’t serious; it’s something virtual. But, 
unfortunately, the information war against OVR and its leaders has 
overstepped all bounds.”

It was very sad to see Primakov’s former minister of taxes explain simple and 
obvious things: that all allegations must be proven in court and not 
publicized in mass media, like has been happening.

“Trust only actions,” appealed Boos. “What actions are behind Dorenko? Or 
Berezovsky, who promised a ‘people’s automobile’ and as a result built the 
first financial pyramid. Luzhkov is backed by real actions ­ every Muscovite 
knows that.”


Date: Thu, 09 Dec 1999 
From: (John Danzer)
Subject: Who Will Replace Putin?

This scenario could happen quickly. Putin and his "generals" are
defending nothing. The prospect of a victory in Chechnya may seem
sweet but it can't be achieved. The Russians have nothing to offer
Chechnya because it can't even take care of their own "ethnic"
Russians. Rather than getting the respect that would build their
self esteem the behavior of the Russian army is creating world wide
disgust. Yeltsin is desperately turning East but his money and
support has come from the West. Yeltsin wants to be liked and
accepted by the West. His humiliation is bound to hasten the
deterioration of his health. Depression kills Yeltsin. After the Duma 
election Putin will
have to go! 

Who will replace Putin? Lebed still lurks in the background. He
represents the possibility of order without the gimmick of war. 
His machismo comes from strength of will and not merely from the
barrel of a gun. This came to the fore when Lebed presided over the
end of the last Chechen war and chose dignity over victory. This
wasn't popular with the military because the generals looked inept. 
However, the mothers of young Russian conscripts loved him for
preventing the senseless slaughter of their sons.

True, Lebed is at the bottom of all the polls. But in Russia you
can come from obscurity to the top by simply beating up on a hated
minority. Lebed has a track record of rebelling against the
establishment in the defense of Russia. If he is appointed Prime
Minister his popularity will rebound as people review his
biography. But even if Yeltsin doesn't make Lebed a no-strings
attached Prime Minister, Lebed is bound to come to the fore. If
Yeltsin doesn't appoint a true leader the center will certainly
crumble. Lebed will then be first among equals as the President of
an independent Krasnoyarsk.


New York Times
December 9, 1999
Ending the Brutality in Chechnya

In the name of combating terrorism, Russian troops are threatening to destroy 
anyone who does not, or cannot, leave the Chechen capital of Grozny. Of the 
more than 20,000 residents, who remain huddled in rooms without heat, light 
or even windows, many are too old or frightened to leave. Most of these 
holdouts are innocent bystanders, far from the "bandits" who are the declared 
targets of Kremlin leaders. It is time for Russia to show restraint, to start 
making certain its armies observe basic humanitarian principles and to begin 
searching for a way out of this tragic war. 

The global outrage about Russian killing of civilians in Chechnya comes as 
Russians prepare to elect a new Parliament on Dec. 19, and with each round of 
international censure, anti-Westerners move up in the polls. Thus some 
analysts suggest that any political settlement in Chechnya cannot occur until 
after that date. This pressure makes the public statements of Russian leaders 
more understandable, but it does not relieve them of the obligation to stop 
troops from razing Grozny and indiscriminately killing innocent civilians. 

This military strategy, as President Clinton noted, does not work, since it 
punishes Chechen civilians more than the Chechen rebels. With every Russian 
abuse, Chechen moderates also become more radical. Moreover, the carnage, 
increasingly visible on television throughout the world, damages Russia's 
stature as other nations come to recognize habits from its authoritarian 

Mr. Clinton said at his news conference yesterday that he saw no workable way 
to impose international sanctions, since Russia has a veto in the United 
Nations Security Council. He argued that cutting United States aid that helps 
dismantle nuclear weapons or promotes democratic capitalism was not in 
America's best interest. The International Monetary Fund, however, has 
continued to delay a $640 million credit for Russia. Though the I.M.F. 
insists that its action is based solely on financial grounds, the delay 
rightly serves notice to Moscow that Western help is not entirely 

The Russians rained thousands of leaflets on Grozny this week declaring to 
Chechens on the ground: "You have lost!" Prime Minister Vladimir Putin and 
other Russian leaders should pay attention to their own message, declare 
their military operation at an end and quickly find a route to a political 


Los Angeles Times
December 9, 1999
[for personal use only]
The West Should Stand Up for Chechnya 
World politics: Russia must get the message that its relations with the U.S. 
and its allies will suffer if the slaughter continues. 
Mark Kramer Is the Director of the Harvard Project on Cold War Studies. 

During the battle of Corregidor in World War II, eyewitnesses described 
the "almost unimaginable scale of destruction. Death has been raining down 
That scene is now about to be replayed in Chechnya, where Russian troops 
have been destroying everything in their way. Moscow's aim increasingly seems 
to be to eliminate the Chechens as a nation. 
This week, Russian military commanders offered a blunt ultimatum to the 
tens of thousands of civilians--mainly elderly and disabled people--who 
remain in Grozny, the Chechen capital: "There will be no more talks. Everyone 
who fails to leave the city [by Dec. 11] will be destroyed." Although 
relentless bombing by Russian planes has made it almost impossible for 
refugees to leave Grozny safely, Russian commanders warned that "those 
staying in the city will be regarded as terrorists and bandits." 
The latest war in Chechnya began in August, three years after Russia was 
forced to accept a humiliating truce that deprived it of any control of the 
republic. During the previous war, from December 1994 to August 1996, Russian 
forces engaged in indiscriminate bombing and shelling of civilian targets, 
yet they were unable to defeat the resistance. 
In this latest conflict, Russian military officers have avoided some of 
the worst mistakes they committed in 1994-96. Russian commanders have relied 
on the methodical advance of infantry and mechanized units, reinforced by 
massive air, missile and artillery strikes. Russian officers have used far 
more troops this time--100,000--and have sought to draw on the most reliable 
and best trained soldiers. 
Despite these improvements, the campaign in Chechnya has not redressed 
the underlying problems and weaknesses of the Russian Army. The army overall 
is still in disarray. The troops are still poorly suited for 
counterinsurgency operations and mountain warfare, the two types of fighting 
that will be essential if Russia hopes to reestablish military control over 
That is why Russia's campaign has become a war of extermination. Without 
the capacity to take on Chechen guerrillas in hand-to-hand combat, Russian 
forces instead are trying to bring about the outright destruction of the 
Chechen republic. 
This is not the first time that the government in Moscow has sought to 
annihilate the Chechen people. During Russia's bloody conquest of the 
Caucasus in the 19th century, entire villages were razed and their 
inhabitants massacred. In 1944, Josef Stalin ordered the wholesale 
deportation of Chechens to Central Asia, leading to the destruction of a 
quarter of the Chechen population. The war in 1994-96 resulted in the deaths 
of at least 30,000 civilians and perhaps as many as 90,000. 
During the latest war, the Russian government has claimed that it is 
merely trying to wipe out "terrorists" who launched raids into neighboring 
Dagestan and who supposedly carried out the horrific bombings of three 
apartment buildings in Moscow. The raids did occur, but no firm evidence has 
emerged that the bombings were carried out by Chechens. Instead, the Russian 
government has used the bombings as a pretext to launch a large-scale 
invasion of Chechnya. 
The Russian Army's campaign in Chechnya bodes ill for Russia's political 
future. An ugly nationalist backlash already seems to be underway. Russian 
Prime Minister Vladimir V. Putin, whose public approval ratings have soared, 
has denounced the "dark-skinned people" in Chechnya, whom Russian forces 
"must annihilate." The destruction of Chechnya may not mean the immediate end 
of Russia's progress toward democracy, but it could do irreparable harm. 
Western governments have expressed criticism of Russia's actions, but 
they have been reluctant to take serious reprisals. During NATO's operations 
in Yugoslavia this past spring, Russia accused the West of genocide and war 
crimes, and suspended cooperative efforts with NATO countries. The operation 
in Yugoslavia had its shortcomings, but NATO did at least try to minimize 
civilian casualties. Russia has shown no such scruples in Chechnya, yet the 
bloodshed there has evoked only muted complaints and little action in the 
Western governments should terminate, not just delay, the loan that 
Russia has been awaiting from the International Monetary Fund. Other forms of 
bilateral and multilateral cooperation, except for programs to dismantle 
nuclear weapons, also should be suspended. 
Although the U.S. and its allies cannot bring a halt to Russia's 
destruction of Chechnya, they should leave no doubt that all aspects of 
Russia's relations with the West will be gravely damaged if the slaughter 


The Times (UK)
December 9 1999
[for personal use only]
Yeltsins 'spent $87,000 on credit cards' 
PRESIDENT YELTSIN and his two daughters spent $87,000 over four years with 
credit cards given to them by a Swiss construction company, its chairman has 

In the latest twist to a scandal that has plagued the Kremlin since the 
summer, Beghjet Pacolli, chairman of Mabetex, has broken his silence on 
claims that his company paid credit card bills for the Yeltsins and 
multimillion-dollar bribes to one of Mr Yeltsin's aides in return for 
lucrative building contacts. 

In an interview published in yesterday's Literaturnaya Gazeta, Mr Pacolli was 
asked if such credit cards existed. "Yes," he replied. "I personally helped 
with this." He claimed to have learnt only three months ago that the cards 
were used by the Yeltsins, but added: "Later I found out who received them, 
and that over four years $87,000 was spent with them." 

The Kremlin has denied that the Yeltsins have had foreign bank accounts, 
which are technically illegal for Russians, but it has not specifically 
addressed claims that they may have used cards issued abroad and left others 
to pay the bills. 

The claims first surfaced in August. A legal spokesman for Switzerland's 
Banco del Gottardo in Lugano has since confirmed that the bank provided a 
guarantee for credit cards for Mr Yeltsin and his daughters, Tatyana 
Dyachenko and Yelena Okulova. 

Last month a Russian newspaper printed what it claimed was a Banco del 
Gottardo statement bearing the signatures of Mr Yeltsin and Pavel Borodin, 
head of the Kremlin's property management company. The bank has dismissed the 
newspaper's documents as a forgery and denied ever holding an account in Mr 
Yeltsin's name. But with Mr Pacolli's claims the allegations will now be 
harder for the Kremlin to ignore. 

The Swiss firm Forus Services SA, linked to allegations of illegal fund 
transfers against Boris Berezovsky, the Kremlin insider, said that an audit 
by the London office of PricewaterhouseCoopers proved that it was innocent. 


Foreign Policy
Winter 1999-2000
After Yeltsin Comes ... Yeltsin
by Daniel Treisman
Daniel Treisman is an assistant professor of political science at the 
University of California at Los Angeles and author of After the Deluge: 
Regional Crises and Political Consolidation in Russia (Ann Arbor: University 
of Michigan Press, 1999). This abstract is adapted from an article appearing 
in the Winter 1999-2000 issue of FOREIGN POLICY magazine. 

Barring some sort of constitutional coup, seven months from now a new 
president will be rearranging the furniture in the Kremlin's official 
chambers. Whoever this successor turns out to be—current prime minister 
Vladimir Putin, Moscow's mayor Yuri Luzhkov, former Prime Minister Yevgeny 
Primakov, Krasnoyarsk governor Alexander Lebed, Communist Party chief Gennadi 
Zyuganov, or some wild-card candidate—he is likely to lead the country in a 
radically new direction, away from the lurching improvisations, regional 
crises, and politics of corruption and deadlock that characterized the late 
Yeltsin era. For better or worse, Russia seems headed somewhere new. 

At least, so one might like to think. And many observers do. As a November 
1998 editorial in the Washington Post put it, Russia's failures in the late 
1990s result from both the current president's "mistakes" and his 
"inconstancy and absence during recent years of illness." In the words of its 
editorialists: "Mr Yeltsin today cannot govern; and as long as he remains 
president, neither can anyone else." Within Russia, opposition candidates 
actively cultivate the impression that Yeltsin's departure will, by itself, 
put an end to Russia's woes. 

Despite its widespread acceptance, this image is almost completely wrong. The 
particular character flaws, intellectual lapses, and health problems of 
Yeltsin do not explain convincingly why successive Russian governments have 
become mired in corruption, why the economy has stagnated, and why the 
country's territorial integrity seems so often an open question. The 
undesirable aspects of Russian politics and policies in the 1990s have 
resulted less from the bad decisions made by powerful central leaders-or even 
from their distraction as the president's health worsened-than from these 
leaders' extreme impotence. A saint or clairvoyant in the Kremlin would have 
also been hedged in by a variety of constraints—some political, some 
economic, and others even geographical—that would shrink any president's room 
for maneuver.

First, Russia is and will remain a decentralized federation. While there is 
much to be said in favor of decentralization, the existence of 89 
semi-autonomous regions also means that economic criminals or tax evaders 
have 89 possible hiding places and 89 chances to find a corrupt regional 
government. Large companies play the regions and the central government 
against each other. The president can do little but bargain with regional 
leaders who threaten secession in order to extort aid, pilfer federal taxes, 
and co-opt federal police or even army units on their territory.

Second, although political corruption is sometimes viewed as a personal 
failing of Russia's current leadership, it is a function of the setting in 
which these leaders-whether naturally honest or avaricious-must operate. 
Countries that are as poor as Russia and that have had as little experience 
with democracy or openness to trade are always corrupt, as a quick glance 
around the world will confirm. Against the force of such conditioning 
factors, the integrity of one leader can only help a little at best. 

Third, in Russia, huge quantities of extremely valuable natural resources are 
concentrated in a few regions. Two districts in Siberia produce four fifths 
of Russia's oil and one fifth of the world's supply, while the Sakha Republic 
accounts for one quarter of the world's diamonds. Highly concentrated 
industrial conglomerates-such as the partially privatized natural gas company 
Gazprom-are another legacy of the Soviet Union. This concentration meant that 
those who happened to be sitting in the best seats after the Soviet-era music 
stopped became instant millionaires. Whether the raw materials barons cashed 
in their chips during the mafia-ridden free-for-all that was the late Soviet 
state economy or the equally corrupt market economy under Yeltsin is a 
secondary matter. The rise of a powerful economic oligarchy became 

Fourth, Russia's fledgling democracy has a presidential system that does not 
guarantee a parliamentary majority for the chief executive. When, as has 
happened throughout the 1990s, the Russian president faces a hostile 
majority, significant policy changes should hardly be expected. Even 
presidential decrees can be overruled by parliamentary laws, and industrial 
lobbyists end up playing the Duma off the president just as they pit the 
central against the regional authorities. 

These constraints remain. Yeltsin's possible successors are starting out 
their campaigns with a variety of plans and programs, ranging from the 
communist revanche of Gennadi Zyuganov to the law-and-order primitivism of 
Alexander Lebed. Yet any one of the candidates, as he tries to implement 
campaign promises or even stray from them, will find himself blocked in by 
the realities of Russia's political game, pushed back toward a set of 
policies and a style of governing that closely resemble Yeltsin's. Like his 
predecessor, the next Russian president will alternately bargain with and 
fight challenges from the country's regional governors, threaten to prosecute 
the big business "oligarchs," while striking secret deals with some of them; 
promise social welfare benefits that never materialize; and scold the West 
rhetorically, while simultaneously negotiating for IMF aid. Within six months 
to a year after taking office, the next president will find himself against 
his will, to the horror of his supporters, and probably against all 
observers' expectations … "becoming Yeltsin." 

The challenge for Western states dealing with Russia in the next couple of 
years can be summed up in a question: What is the best way to deal with a 
naked emperor? Within the first year of taking office, the new Russian 
president, and his supporters, are likely to realize the emptiness of their 
hopes for a breakthrough. An emperor whose nakedness has become apparent will 
be preoccupied at least initially with finding some clothes, possibly leading 
to a sharpening of anti-Western rhetoric. 

The danger is that Western politicians will overreact to the hostile 
rhetoric, stir up public opinion, and shut off contact, thus missing the 
opportunities that such rhetoric conceals. One day, probably about a year 
after he moves into the Kremlin, Russia's next president will look in the 
mirror and see not himself but Boris Nikolaevich Yeltsin. Let us hope that by 
that time the West has not taught itself to see Lenin or Stalin. 


No. 45
[translation for personal use only from RIA Novosti]
(From an interview given by Sergei KALASHNIKOV, minister
of labour and social development of the Russian Federation)

There is a 27-fold gap between the living standards of
the 10 percent of the wealthiest and 10 percent of the poorest

Back in 1996, the United Nations Organisation published
its standard whereby a person's average income equals 5,500
dollars a year. In Russia, the average annual income is
800-1,200 dollars. Besides, back in the mid-1980s the UN
proclaimed that the minimum wage should not be lower than 3
dollars per hour. In this country, the average monthly wage is
70-80 dollars, i.e., no more than 0.5 dollars per hour.
As of today, the men's average life span in Russia is
58.5 years. As you know, the pension age for men in this
country is 60 years. Thus, the majority of the male population
do not live to see the day when the state starts paying them
their retirement pensions.
As of October 1, 1999, the average subsistence minimum in
this country was 976 roubles a month. However, this figure is
different in different regions. In Moscow, for instance, it is
about 2,000 roubles, while in Belgorod or Ulyanovsk it is
about 500 roubles a month.
According to statistical data, incomes of 34 percent of
the country's population are below the subsistence level.
True, statistics register only a part of their incomes. The
so-called "grey" economy and, consequently, grey wages make
over 60 percent of their earnings. However, even considering
shadow incomes, the proportion of the truly poor people living
in dire poverty is too high - over 25 percent of the entire
About 20 percent of Russia's population live according to
European standards: they have large, well-arranged flats, a
car, a country cottage and appropriate diet and can spend
their yearly vacation at expensive resorts. Of this number,
4-5 percent are super-rich people.
As we have already said, 34 percent of the population (or
25 percent, taking grey incomes into consideration) live
beyond the poverty line. Over the past years they have lost
most of all. These people's consumption level (of both
foodstuffs and clothes) has dropped by 30-50 percent compared
to the Soviet times.
The remaining 50-60 percent of the Russians are people
who are not starving, can go to a cheap national resort once a
year and save money to buy a car within several years.
On the whole, statistics tell that there is a 27-fold gap
between the 10 percent of the wealthiest and 10 percent of the
poorest members of society.
Today, the average monthly wage in industry is 1,750
roubles, and in the public sector - 950-1,100 roubles.
However, these are not the real people's incomes. According to
statistics, wages account for 42 percent of the population's
incomes, with other types of incomes accounting for 58 percent
of the total. These other types of incomes include bonuses,
material aid and unregistered on the side earnings.
If we calculate the number of the unemployed in this
country by applying the International Labour Organisation's
methods (which lists with the unemployed not only people who
are officially registered with employment bureaus but also
those who have no official source of income - Profil), we
shall have about 10.5 million jobless in this country (14.2
percent of the able-bodied population) at the very peak of
unemployment, i.e., in March of 1999. By now the number of the
unemployed has somewhat dropped. As of October 1, this figure
equaled 9.2 million people (calculated according to the ILO
However, if "grey economy" accounts for 60 percent of the
total economy, then all street vendors, shuttle traders and,
say, Herbalife distributors are included into these 9.2
million. Therefore, the real unemployment figure is much
What we have in Russia today might be called structural
unemployment. It means that a person cannot find a job which
matches his educational level, ambitions, psychological
factors, etc.
For instance, there are 5 million guest workers in Russia
today. Builders and trolleybus drivers are mostly from Ukraine
and Moldova. Russians are not too eager to take these jobs. We
now have an opportunity to offer up to 2 million jobs for
those who are not averse to doing socially useful works. For
instance, Moscow has a great number of vacancies with wages of
up to 2,000 roubles a month. However, Muscovites do not want
to work for this money.


U.S. wants good ties with Russia despite spy flap
By Steve Holland

WASHINGTON, Dec 9 (Reuters) - The United States said on Thursday it still 
wants a constructive relationship with Russia despite the expulsion of a 
Russian diplomat on spying charges and evidence of widespread Russian 
intelligence activity. 

``Our policy of engagement with Russia has not changed,'' said Mike Hammer, 
spokesman for the White House National Security Council. ``We have a broad 
range of shared interests in the U.S.-Russia relationship and we intend to 
continue to pursue them.'' 

A Russian diplomat was arrested and ordered expelled within 10 days on 
Wednesday because of a listening device planted in a sensitive area inside 
the U.S. State Department. 

The listening device was detected in a room where high-level conferences take 
place at the State Department, but it was unclear what sensitive discussions 
might have been monitored, officials said. 

``This incident demonstrates how seriously we take counterintelligence and 
our technical countermeasures programme. We must remain vigilant of threats 
posed by foreign intelligence services, regardless of the state of bilateral 
relations with a particular country,'' Hammer said. 

``This incident, by itself, sends a strong message that there is a very 
aggressive Russian intelligence presence operation inside the United States, 
said Neil Gallagher, assistant director of the FBI's national security 

U.S. officials denied the diplomat's arrest was in retaliation for Russia's 
expulsion order a week ago against a U.S. diplomat who Moscow said was caught 

``No,'' said a U.S. official, speaking on condition of anonymity. ``This 
investigation has been going on for a number of months. In a way it's 
coincidental... There's no connection between the two. In essence it just 
came to a head when he was caught red-handed.'' 

Gallagher said U.S. counterintelligence agents noticed the Russian diplomat, 
attache Stanislav Gusev, walking the street around the State Department 
during the summer of 1999. 

``Over a period of some time they identified that on a rather frequent basis, 
each week, Mr. Gusev would show up in the vicinity of State Department, 
literally just walking around the surrounding street,'' he told a briefing. 

By the way he moved and parked his car, they concluded he was conducting a 
``technical operation.'' They swept the building for transmitting devices and 
found one some months ago. 

FBI agents arrested Gusev near the State Department on Wednesday as he was 
adjusting the reception equipment, Gallagher said. The device, described as 
extremely sophisticated and planted professionally, was transmitting at the 
time of his arrest, he added. 

At an FBI field office, when Gusev identified himself as a Russian diplomat, 
the FBI called in Russian embassy officials and handed him over. He spent 
about three hours in custody. 

U.S. officials said they were not surprised that Russia was seeking 
intelligence from the United States despite the warming trend in relations in 
the past decade. 

``We have no illusions about other countries' intentions or efforts to try to 
secure U.S. national security information and secrets. We have an aggressive 
counterespionage programme,'' one official said. 

It was the third case of alleged espionage between Russia and the United 
States in a month and came at a time of tension in relations between the 
United States and Russia over a host of issues, including Western criticism 
of Moscow's campaign in Chechnya and Washington's desire to amend a key arms 

The diplomat was identified by Russian news reports as Cheri Leberknight, and 
television stations broadcast pictures of her being detained in a park in 
eastern Moscow. 

The U.S. State Department did not identify the woman, but confirmed a U.S. 
diplomat was asked to leave Russia and would depart within the allotted 10 

On Nov. 29 the U.S. Navy said it had charged an enlisted man who had access 
to highly classified data with passing secrets to Russia in 1994. 

Petty Officer 1st Class Daniel King, 40, was taken into military custody on 
Nov. 5 and confessed to disclosing classified information to Russia, the 
officials said. 

As the spy drama unfolded, Clinton and Russian President Boris Yeltsin traded 
criticism on Thursday about Russia's Chechnya offensive. 

Asked to react to Yeltsin's blunt reminder that Russia ``has a full arsenal 
of nuclear weapons,'' Clinton said, ``I haven't forgotten that. You know, I 
didn't think he'd forgotten America was a great power when he disagreed with 
what I did in Kosovo.'' 

Yeltsin's outburst came on a visit to Beijing. He was coming under increasing 
criticism from the West over Russia's Chechnyan assault because of civilian 
casualties and a refugee population of 200,000. 

Clinton's point, made repeatedly this week, was that Russia will pay a heavy 
price with its Chechen offensive through a loss of international prestige and 
by alienating investors. 



Moscow, 8th December, ITAR-TASS correspondent Diana Rudakova: The Central 
Electoral Commission today published details of the total finances received 
by the funds of the electoral associations and blocs and also of their 

According to the Savings Bank of Russia, as of 3rd December 1999 the richest 
group taking part in the election campaign is the Bear electoral bloc. Its 
election fund has received R40,072,175, of which they have so far spent 
R21,777,036. In second place is Zhirinovskiy's Bloc. It has had R39,609,950 
put into its account, of which R30,548,848 has been spent. The top three 
richest participants in the election campaign is completed by the Communist 
Party of the Russian Federation. The communists received R39,327,960, of 
which R15,698,025 has been spent on the elections.

Just off the top three are the right-wing and Fatherland-All Russia. The 
Union of Right Forces had R36,902,740 in their account and have spent 
R28,412,727. The financial prosperity of Fatherland-All-Russia was put at 
R36,727,739, all of which they have now spent on the election campaign. As 
for Yabloko, its election fund was put at R29,480,800 and their spending at 

The poorest election association could be the Communists, Working People of 
Russia - for the Soviet Union. It had just R300,740 in its account, of which 
R230,363 has been spent.


Russia Promises Lawful Elections
December 9, 1999

MOSCOW (AP) - Prime Minister Vladimir Putin pledged Thursday that Russia's 
parliamentary elections would be held in strict accordance with the law, from 
the balloting through the count. 

``We must do everything for absolute observance of the law,'' Putin told an 
intercom conference of local and federal officials organizing the Dec. 19 
vote for the lower house of parliament, the State Duma, the ITAR-Tass news 
agency reported. 

However, Vladislav Surkov, the deputy head of President Boris Yeltsin's 
administration, warned that regional electoral commissions were coming under 
pressure from ``groups of influence,'' ITAR-Tass said. He did not identify 
the groups or describe the kind of pressure they were applying. 

Meanwhile, a leading polling agency said Thursday that the Communists were in 
the lead, the Interfax news agency reported. 

The poll by the All-Russian Center for the Study of Public Opinion, which was 
conducted among 1,600 respondents on Nov. 29, showed that 25 percent of 
Russians who were planning to vote would cast votes for the Communists. The 
centrist Fatherland-All Russia coalition received 12 percent. The report did 
not give a margin of error. 

Two other polling firms showed 21 percent support and 18 percent support for 
the Communists in their latest surveys, Interfax said. 

Under Russia's electoral laws, half of the Duma's 450 seats are filled by 
candidates from individual constituencies, while the rest are taken according 
to the percentage of seats won by each party on the ballot. 



Return to CDI's Home Page  I  Return to CDI's Library