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Johnson's Russia List


January 3, 2000    
This Date's Issues: 4005 4006


Johnson's Russia List
3 January 2000

[Note from David Johnson:
1. AFP: Russian democracy needs to be defended, Gorbachev says.
2. No Tears for Boris.
3. AP: Yeltsin Said To Be in Great Mood.
4. Reuters: Frozen Swiss accounts may be linked to Yeltsin-Newsweek.
5. AP: Clinton Hails Yeltsin.
6. Time magazine: Bill Clinton, Remembering Yeltsin.
7. AFP: In word and deed, the Putin style seduces Russians.
8. AP: Putin Fate May Depend on Chechnya.
9. Gleb Glinka: Re 4003-Stratfor/How the West Killed Yeltsin.
10. Tom de Waal: Re North Caucasus/Future of Chechnya/Ware.
11. Patrick Jones: re article Presidents and the price of Pardon/4003.
12. Nat Hooper: why is Acting President Putin reffered to as the "Master spy"?
13. Boston Globe editorial: Yeltsin and history.
14. Yevegeny Ozhogin: re, How the West Killed Yeltsin.
15. Washington Post letter: An Unhealthy Russia.
16. BUSINESS WEEK ONLINE: Paul Starobin, Vladimir Putin: More Questions Than Answers So Far. He's young and is supported by key elites, but most Russians don't know what he stands for or where he's headed.] 


Russian democracy needs to be defended, Gorbachev says

Former Soviet president Mikhail Gorbachev on Sunday called the ascension of 
acting President Vladimir Putin "a good transfer of power" but said democracy 
in Russia needs to be defended.

"In principal, I think this is something to welcome. It would have been 
better if it happened a year or two ago," Gorbachev said on NBC's "Meet the 

Former president Boris Yeltsin resigned Friday and handed power to his 
hand-picked successor until elections scheduled for March.

But Gorbachev said that amid severe economic privations and growing 
anti-Western sentiment, "we have to protect democracy."

"We have to defend democracy in our society because people are saying that 
this is a democracy which has led to a situation where 80 percent are below 
the poverty line," he said.

"If (Putin) takes the course of Yeltsin, copying what Yeltsin's been doing, 
that would be a mistake ... we need a strong state, but a democratic one."

"We want everyone to feel he is protected by the state, the businessman and 
the ordinary worker, that his rights are being protected by the constitution."

Asked whether Chechnya would become "a domestic Afghanistan," Gorbachev said 
the Russian government was doing everything it can to avoid excessive 
violence there.

"The mood (in Russia) is that this wound should be stanched but we shouldn't 
set off the mechanism to allow dramatic or tragic events to occur," Gorbachev 

"It's important not to permit the destruction, and prevent the sufferings of 
thousands of peaceful citizens and also our soldiers, our Russian soldiers 
shouldn't be throw-aways," Gorbachev said.

Within hours of becoming Russia's acting president, Putin, 47, flew to the 
North Caucasus for a morale-boosting visit to troops fighting rebel forces in 
Chechnya, ringing in the new millennium while flying in a military helicopter.

Gorbachev was also asked whether Putin did the right thing in granting 
Yeltsin and his family immunity from criminal prosecution -- one of Putin's 
first presidential acts.

"If the question arises of responsibility for specific criminal misdeeds, 
then of course, the law will go into action," Gorbachev answered. "I don't 
think Putin or Yeltsin or anyone else can do anything about that."

Yeltsin and his family have been accused of illegal business practices, and 
his aides of money laundering.

"It was a good transfer of power, it occurred in a democratic fashion," 
Gorbachev said.


2 January 2000
No Tears for Boris 

Boris Yeltsin's top strategists began plotting his early resignation as 
early as last May, TIME's Moscow bureau chief Paul Quinn-Judge reports. Gleb 
Pavlovsky, the political consultant who is one of the Kremlin's main 
political strategists, told TIME that he proposed the idea last summer. 
Pavlovsky said two conditions had to be fulfilled for the gambit to work: The 
president needed a successor he could trust completely, and all serious 
contenders for the presidency would have to be weakened beyond the point of 
presenting any danger. "The final decision," Quinn-Judge writes, "was 
probably made last Wednesday evening--a fact that suggests there was 
considerable debate within the Yeltsin camp on the desirability, or perhaps 
feasibility, of persuading the President to step down." Palovksy tells TIME 
the biggest threat facing Putin is dramatically inflated popular 


Yeltsin Said To Be in Great Mood
2 January 2000

MOSCOW (AP) - Boris Yeltsin has been in a great mood since he resigned last 
week as president, a top Kremlin official said Sunday.

``I know that on January 1 ... Boris Nikolayevich was in a very pleasant 
disposition, so to speak, and in a good mood,'' said Igor Shabdurasulov, the 
first deputy head of the presidential administration.

``He even said that this is perhaps the first New Year in recent years that 
he has been in such an elated mood,'' Shabdurasulov was quoted as saying by 
the ITAR-Tass news agency.

Yeltsin shocked Russia on Friday by stepping down six months before the end 
of his term and naming his prime minister, Vladimir Putin, acting president.

Shabdurasulov said that Yeltsin had made the decision on his own.

``There was nothing secret or extraordinary,'' he said. ``There is not and 
cannot be any man who would be able to make Boris Nikolayevich Yeltsin do 
anything that would not be in line with his understanding and conviction.''

Shabdurasulov said that Yeltsin's daughter, Tatyana Dyachenko, would probably 
no longer hold her job in the Kremlin. She has served as Yeltsin's image 
maker and has been one of his closest advisers.

``I think that Tatyana Borisovna will change her status,'' Shabdurasulov 
said. ``I think that's obvious. Not that there's any hurry, no one is running 
anywhere and rushing to sign decrees.''

Dyachenko and other members of Yeltsin's inner circle have been linked to 
corruption allegations that have kept the Kremlin under constant political 
attack over the past year.

Prosecutors in Switzerland and Russia have been investigating the 
allegations, but no charges have been filed.

Shortly before leaving on an Orthodox Christmas pilgrimage to holy sites in 
Israel and the West Bank, Russian Orthodox Patriarch Alexy II expressed 
thanks to Yeltsin on Sunday ``for everything he has done over the eight 
years,'' the Interfax news agency reported.

He expressed particular gratitude for Yeltsin's support of the Orthodox 
Church, and said that Yeltsin's arrival in the Kremlin had opened the way for 
the revival of religious life in post-Communist Russia.

``Whenever we turned to Yeltsin for help, he always supported us,'' Alexy was 
quoted as saying.


Frozen Swiss accounts may be linked to Yeltsin-Newsweek

NEW YORK, Jan 2 (Reuters) - A dozen bank accounts containing more than $15 
million frozen by Swiss authorities investigating Russian money laundering, 
are suspected of being linked to Boris Yeltsin, Newsweek reported on Sunday. 

While Yeltsin's aides have consistently denied that he has any foreign bank 
accounts, unnamed sources say the accounts in question are not in Yeltsin's 
name, but rather are held by offshore companies or in the names of individual 
businessmen, both Russian and foreign, Newsweek reports. 

The Swiss authorities, which froze the accounts last summer, suspect they may 
be linked to former president Yeltsin, who resigned last Friday, according to 
the latest edition of Newsweek. The news magazine does not indicate why Swiss 
authorities suspect a link. 

Swiss prosecutors are investigating an alleged multi-billion dollar Russian 
money laundering scheme linked to Russian politicians, businessmen and their 
family members, and a separate case involving claims of bribes paid to 
Kremlin officials. 

They also believe there are links between accounts in a Bank of New York
money laundering case and the frozen Swiss accounts. 

The Kremlin denies the charges and Russian politicians have said the 
allegations were politically inspired ahead of elections. 

The freezing of the accounts does not necessarily imply any wrongdoing, but 
Yeltsin has been dogged by corruption charges since last summer, when 
political foes raised the issue and forced an impeachment vote. Yeltsin won 
the vote. 

Yeltsin, 68, who resigned suddenly from office on the final day of last year, 
and his family have been given guarantees of immunity by Prime Minister 
Vladimir Putin, who was appointed acting president by Yeltsin. 

Newsweek said informed sources told them Yeltsin made his decision to leave 
office on Dec. 24, less than a week after his Unity party's success in 
Russia's parliamentary election. It remained a tightly held secret for a 

Although Yeltsin insisted he was not stepping down because of his health, 
Newsweek reported sources saying his overall health had worsened 
significantly in the last few weeks. 


Clinton Hails Yeltsin
2 January 2000

WASHINGTON (AP) - President Clinton hailed Boris Yeltsin in a magazine essay 
as the ``Father of Russian Democracy'' but said how Yeltsin's successor 
handles such ``unfinished business'' as corruption and the war in Chechnya 
will determine Russia's place among nations.

Yeltsin's successor, Vladimir Putin, has been a moving force behind Russia's 
attack on the rebellious region of Chechnya, a campaign of which Clinton has 
been an outspoken critic. Clinton suggested that the outcome in Chechnya 
would set the tone for relations between the new leadership in Moscow and 
other nations.

``The question for President Yeltsin's successors is not only how to liberate 
Grozny without killing thousands of civilians; it's also whether this war 
becomes a model for how to deal with other problems involving terrorists and 
separatists,'' Clinton wrote in the essay that appears in the Jan. 1 issue of 
Time magazine.

``Russia has to find the right balance between the use of effective force and 
decent respect for individual rights and international norms,'' Clinton said.

In addition to helping the Russian economy grow, Putin must do more to fight 
crime and corruption, Clinton said.

``Unless that battle is joined ... the democratic norms and the market 
economy that have been Yeltsin's prime focus can be undone,'' he wrote.

Clinton also noted there have been ``plenty of strains'' in U.S.-Russian 
relations and that many observers have questioned the value of partnership 
between the two nations.

``President Yeltsin and I believed our countries should, whenever and 
wherever possible, work together on our many common interests and work hard 
to keep our disagreements from preventing us from cooperating in other 
areas,'' Clinton wrote, listing the dismantling of 5,000 nuclear weapons, the 
withdrawal of Russian troops from the Balkans and efforts to liberalize the 
Russian economy and bolster democracy as successes of the policy of 

``If Russia's new leaders - the generation to whom Boris Yeltsin gave the 
stage last Friday - endorse this as firmly as he did, they will find in 
America an eager and active partner,'' Clinton said.


Time magazine
JANUARY 1, 2000 VOL. 155 NO. 1 
Remembering Yeltsin

When I spoke to Boris Yeltsin by phone on New Year's Eve, shortly after he 
announced his resignation, he conveyed a mixture of relief that a tough 
choice was behind him and confidence that it was the right choice for his 

The manner of his leaving the presidency was vintage Yeltsin--bold, blunt, 
even defiant, but rooted in his core belief in the right and the ability of 
the Russian people to choose their own leaders and their own course for the 

I met him for the first time in June 1992, when I was still a candidate for 
the presidency and he was fairly new in his own job. Since then, in the 19 
times we've met, I have often heard him speak, with unmistakable and 
sometimes pugnacious pride, about his greatest achievements and, with equally 
straightforward candor, about where he still had work to do to build a 
genuinely democratic, prosperous and modern Russia, pursuing its national 
interests while cooperating with other great nations and international 

In his statement on Friday he took obvious delight in scoffing at predictions 
("lies," he called them) that he would never give up power voluntarily. His 
critics and rivals wanted to cast him as an autocrat. But the single idea I 
heard Boris Yeltsin utter more than any other was that his country must never 
go back to a dictatorship of any kind, especially to the communist system he 
so clearly detested. His enduring commitment to democracy was evident in his 
resignation statement, when he said that Russia's recent parliamentary 
elections, which brought forward a "new generation of politicians," had 
persuaded him that he had finished "the main job of my life."

Now Yeltsin's designated successor, Vladimir Putin, must be the custodian of 
Russia's democracy while running for its presidency in March. If Russia is 
successful in passing power from its first democratically elected President 
to its second, then the country's direction will be in the hands of a new 
elected President and Duma, as well as the thousands of elected officials who 
now run local governments. Multiple parties vie for power through the ballot 
box. There are some 65,000 nongovernmental organizations and approximately 
900,000 private businesses where there were none a decade ago. A pluralist 
political system and civil society, competing in the world markets and 
plugged into the Internet, have emerged from a totalitarian monolith that was 
closed off from the outside world and implacably hostile to our values and 

No one deserves a larger share of the credit for this transformation than 
Yeltsin himself. For all his difficulties, he has been brave, visionary and 
forthright, and he has earned the right to be called the Father of Russian 

In saying farewell, Yeltsin was characteristically frank about what hasn't 
gone right under his leadership. He asked "forgiveness" for hopes that 
haven't been realized. "What we thought would be easy turned out to be 
painfully difficult," he said, acknowledging that along with new 
opportunities for some, the past decade has brought deep hardship for others.

From our many meetings, I know that no problem he has faced has been as 
frustrating, year in and year out, for Yeltsin as turning the economy around 
and giving Russians better lives. He has always seen himself as their 
champion. Despite Russian citizens' difficulties, there are some signs of 
economic growth, and there was no sign in last month's elections that they 
have given up on reform. Indeed, many of those who did best in Duma elections 
told the people there has been too little reform, not too much.

The economy is not the only piece of unfinished business that Yeltsin leaves 
behind. There are three others that he and I have often talked about. First 
is crime and corruption. Unless that battle is joined and, over time, won, 
the democratic norms and the market economy that have been Yeltsin's prime 
focus can be undone. Russian citizens, like those of other democracies, need 
confidence that theirs really is a government of laws. Otherwise, they will 
turn to other leaders, and perhaps even to other forms of government.

Then there is the immediate issue of the war in Chechnya. We have a profound 
and open disagreement with the Russian government, not on its right to oppose 
violent Chechen rebels but on the treatment of refugees. The question for 
President Yeltsin's successors is not only how to liberate Grozny without 
killing thousands of civilians; it's also whether this war becomes a model 
for how to deal with other problems involving terrorists and separatists. 
Russia has to find the right balance between the use of effective force and 
decent respect for individual rights and international norms. In Chechnya 
that balance has not yet been found.

Finally, there is the overarching question of Russia's relationship to the 
outside world. President Yeltsin and I believed our countries should, 
whenever and wherever possible, work together on our many common interests 
and work hard to keep our disagreements from preventing us from cooperating 
in other areas.

Though the chemistry between us was good, the partnership we established has 
been subject to plenty of strains. Most have been on specific issues--NATO 
enlargement and its actions in Kosovo, Chechnya, and antimissile defenses. 
But there has been a growing tendency lately in both countries to question 
the premise of partnership--to cast doubt on whether Russia and the U.S. do 
indeed have common interests outweighing our differences. Whether the issue 
at hand is arms control or nonproliferation, peace in the Balkans or in the 
Middle East, opening up the international economy or shutting down terrorism, 
I believe Russia and America have far more to gain by approaching these 
problems cooperatively than by falling into the trap of zero-sum politics.

For those with doubts, look at the years since 1991: 5,000 strategic nuclear 
weapons have been dismantled; U.S. and Russian nuclear weapons are no longer 
targeted at each other; nuclear weapons have been removed from the other 
former Soviet states. Russia has withdrawn its troops from the Baltics, and 
it has played a positive role in the Balkans; now Russian troops serve 
alongside Americans in Bosnia, and Russian diplomacy was instrumental in 
achieving peace in Kosovo. The machinery of communism has been dismantled, 
and the vast majority of Russians work for private employers--not the state.

If Russia's new leaders--the generation to whom Boris Yeltsin gave the stage 
last Friday--endorse this as firmly as he did, they will find in America an 
eager and active partner. 


In word and deed, the Putin style seduces Russians

MOSCOW, Jan 2 (AFP) - 
He has a black belt in judo. He calls criminals "rats" to be "exterminated." 
He says Russia is a "great" nation and tells its tired people that he has the 
will and the means to make sure it remains so.

With carefully-chosen words and a few well-orchestrated deeds, Vladimir Putin 
is winning hearts and minds in Russia and has concocted a style designed to 
convince the population that they have a new and competent protector.

"When the leadership is indecisive, the people will not forgive it ... when 
civil peace is endangered, the government must act forcefully and 
effectively," Putin said last year as he launched an offensive in Chechnya.

The contrast between the 47-year-old Putin and his predecessor, Boris 
Yeltsin, 68, could not be more stark: the former, physically able and sharp, 
the latter feeble and often visibly distracted.

In a relatively short period of time, Putin has played on this distinction to 
demonstrate, convincingly to increasing numbers of Russians, that he is 
capable of assuming the highest duties of state.

Alternating between street slang and high political rhetoric, Putin has in 
recent weeks become the champion of a "new state ideology based on patriotism 
... by reviving a feeling of national pride among a humiliated citizenry," 
one political analyst said.

The key to Putin, said this and other experts, is that he "stays on message," 
and that message is: Russia is still a great power and should be treated like 

"Russia will not be dictated to, and will use all diplomatic and 
military-political means at its disposal" to prevent this, Putin said 
recently, as he recalled that the country was still protected by a "nuclear 

As part of his crusade, Putin has also gone out of his way to stroke the 
military at each opportune occasion.

In a gesture that recalled the slick calculation of many Western political 
campaigns, Putin spent this historic New Year's Eve uncorking a bottle of 
champagne in a military helicopter over Chechnya, where he rallied the troops 
and passed out commendations.

When accounts of heavy losses among Russian troops in Chechnya began 
circulating last month, Putin was the first to deny and denounce them.

"This is total stupidity which has no basis in fact," Putin said. Journalists 
accounts of seeing the bodies of dozens of Russian troops killed in Grozny 
were nothing but "pure propaganda and lies," he stormed.

In addition to his midnight New Year's chopper ride, Putin was shown last 
October 20 making another visit to the conflict zone, that time in the back 
seat of a Sukhoi-25 fighter plane flying over Chechnya.

Analysts say that his words and deeds serve to project a confidence in 
himself and, by implication, in Russia that has not been seen in this country 
in many years.

As his judo instructor told a television station, Putin "is a sportsman with 
an unshakeable will, who always achieves his goal and who does not hesitate 
in making his decisions."


Putin Fate May Depend on Chechnya
2 January 2000

WASHINGTON (AP) - Though his hard line on Chechnya has driven up his 
popularity, acting Russian President Vladimir Putin's political future may 
depend whether he settles the conflict peacefully, top Clinton administration 
officials said Sunday.

Having ascended to the presidency following Boris Yeltsin's surprise New 
Year's Eve resignation, Putin is the early favorite in the March elections. 
But a Chechnian quagmire may bring him down, the officials said.

``Chechnya now is a dilemma,'' National Security Adviser Samuel Berger said 
on ABC's ``This Week.'' ``If it goes on too long, or if it begins to cause 
increasing Russian casualties, as we seem to be seeing now, with an 
intensified resistance, this could become something that mires Putin down, 
and the wave he rode up could become the wave that engulfs him.''

Putin has been an outspoken supporter of Russia's military intervention in 
Chechnya, defending it against criticism in the West. On his first full day 
as acting president, he visited Russian forces in Chechnya to praise them for 
the campaign.

But the Chechnya war won't be settled on the battlefield but around a 
negotiating table, Secretary of State Madeleine Albright said on NBC's ``Meet 
the Press.''

``There can only be a political solution to this,'' Albright said.

The outcome of the war also will set the tone for relations between Moscow 
and other nations, President Clinton said in a farewell essay to Yeltsin 
published in Time magazine.

Meanwhile, Clinton administration officials said the peaceful handoff of 
power to Putin bode well for Russia's democratic future.

``This transfer of power is something we believe has taken place 
democratically,'' Albright said.

Still, there was an element of uncertainty with Putin, aides warned.

``So far, we're pleased with the statements that he's made about affirming 
Russian democracy, freedom of the press, freedom of speech, freedom of 
conscience, private property,'' Berger said. ``But I don't think we yet have 
all the answers as to where Mr. Putin - what direction he intends to lead 
Russia. We hope that it will continue to be the democratic direction.''

Administration officials noted that Putin was a member of the KGB, the 
Russian spy agency, but also was part of the reformist government of the city 
of St. Petersburg. ``He has been a prime reformer,'' Albright said.

And Dmitri Yakushkin, Russian deputy chief of administration, said Putin's 
KGB pedigree should not be of concern.

``I can name you a number of Americans who worked for the CIA and became 
great statesmen,'' Yakushkin said on NBC. ``The KGB was part of the 
government structure. People who worked in the KGB were very professional.''


Date: Sun, 02 Jan 2000 
From: Gleb Glinka <> 
Subject: Read #9 -- it's absolutely correct! (4003-Stratfor/How the West 
Killed Yeltsin)

There is no question, certainly, that the struggle for Caspian oil--an eerie
echo of the politics that ushered in the last century--is a major factor in
battle for Chechnya.  Having returned from Moscow in November, though, I am
also convinced that a principal motive for this second campaign, despite the
disaster of 1996, is the universal feeling of terrible vulnerability among
ordinary Russians after the series of gruesome apartment bombings in Moscow
Volgograd (to say nothing of the vicious three-year history of kidnappings,
hostages, sadistic maimings, televised beheadings of journalists and aid
workers, rapes of mothers looking for their children lost in 1996, etc.).  Do
not underestimate the psychological impact of such random violence, Bruce. 
Imagine Iran acting this way in New York City or Washington.  In the final
analysis, I think, the assault on Chechnya is not only a claim to Caspian oil,
but part of a developing solidarity and self-definition in the face of the
realization that Russia must fend for itself. 

On the significance of Yeltsin's passing, #9 by Stratfor seems to me to be 
right on target, though I firmly believe that our own interests are
not well served by having a compliant puppet in power in Russia, but by being
seen as willing to support Russia in re-emerging on her own terms. 
Friendship, rather than manipulation, ensures loyalty. 


Date: Sun, 02 Jan 2000
From: "Tom de Waal" <> 
Subject: Re North Caucasus/Future of Chechnya/Ware

The future of Chechnya is indeed a fiendishly complicated issue. I don't 
want to engage here in another round of detailed debate with Robert Bruce 
Ware. Suffice it to say that, although I totally reject his views, I believe 
he does raise two important questions, which deserve closer attention: What 
kind of political settlement is possible in Chechnya? And what can be done 
to maintain security in the North Caucasus as a whole?

A few brief comments:

1. The generals have no political strategy. The position of Ware and other 
apologists for the military solution is to give the green light to the 
Kvashnins and Shamanovs, whose place, as far as I am concerned, is not in 
political negotiations on Chechnya but in a war crimes tribunal in The 
Hague. But of course the military option merely destroys the political 
option. Dr Enver Kisriev of Makhachkala put it better than I could when he 
said (I paraphrase) "The campaign is a crime because the Russian army can go 
ten times to the Georgian border and back again and they will still not have 
come up with a political solution to the problem."

2. Any regional stability won through military means will be extremely 
short-term. Even if there is a short-term victory in Chechnya, it would be 
extremely naive to believe long-term stability in the North Caucasus can be 
won by means of Russian military rule. As Emil Pain pointed out recently: in 
the spring of 1995 Chechnya was 90 percent occupied by Russian forces, but 
they could not keep hold of it and gradually lost everything again. At that 
point the Kremlin decided to call in its North Caucasian specialists again. 
This time Moscow is merely inviting guerrilla warfare, continued resistance, 
perhaps acts of terror. The poverty and political alienation which are at 
the root of the problem will not have gone away. Moscow needs a sustained 
economic and social policy for the North Caucasus, based less on power 
politics and more on the needs of the population.

3. Maskhadov. Yes, Moscow has done everything possible to ignore, 
marginalize and destroy the man it still recognizes as legitimate leader of 
Chechnya, Aslan Maskhadov. But to listen to the North Caucasian leaders, 
such as Aushev, Dzasokhov and Magomedov and also ordinary Chechens, any 
political dialogue must involve the Chechen president. Anything else is an 
insult to the region. His role may now be limited to negotiating an end to 
the war, rather than discussion of any big political structures, but even 
that is an important role. By the way Maskhadov, pace Ware, did try to crack 
down on kidnapping and lawlessness. His Anti-Terrorist unit, which I visited 
in 1998, fought several bloody battles with kidnap gangs. But they were also 
desperately under-resourced (they had only just got their first photocopier 
when I saw them), while the kidnappers had grown rich on million-dollar 
ransoms. Had Maskhadov had some decent support from Moscow he might have 
made more headway.

4. Political solutions anyone? God knows, Moscow has no moral authority left 
in Chechnya. Basayev and co also have dwindling authority. Does anybody 
remember the joint patrols, staffed by both Russian soldiers and Chechen 
fighters, that operated in Chechnya in the autumn of 1996? That seems a 
pretty remote possibility now, but only some kind of joint police force 
would keep the Russian soldiers in check, while Russia makes another attempt 
to administer Chechnya.


From: "Patrick Jones" <>
Date: Sun, 2 Jan 2000 
Subject: article Presidents and the price of Pardon/4003

Rick Jones, Managing Director Baxter Corp Holdings Ltd
Prague, CR

Stratfor's argument that Acting President Putin has at his disposal 
only two policy alternatives that are likely to result in 
the return to Russia of large amounts of capital by the Russian 
oligarchs is overly pessimistic and ignores a more nuanced and 
sophisticated solution.

The two alternatives that Stratfor posits are day and night 
opposites that stand little chance of being implemented let alone of 
being successful. It is very difficult to believe that an oligarch 
would return his ill gotten gains after so much effort for the 
promise of a pardon and the permission to keep a portion of his loot 
"to live comfortably". Thus the oligarch promises not to be naughty 
and earns a tip. Not likely. 

The second scenario which could be properly described as the "fire 
and brimstone approach" of mass arrests, property confiscations, 
terror is also rather remote. Given the fact that most of the "loot" 
is outside of Russia the results of the operation would most probably 
not be very effective in recovering the stolen capital. Not to 
mention the bad publicity of a return to "repressive measures".

More likely, Mr. Putin will weave a policy of incentives, reforms, 
and not so subtle threats to woo the capital back into Russia in the 
form of investments. Investments can include the purchase of 
government bonds and the funding of needed programs to reanimate the 

Relying on the old adage that often honey is more effective in 
catching flies might just be the cornerstone of Mr. Putin's program.
A complex program of tax reform, property protection, judicial 
overhaul, tax holidays and incentives, bank restructuring is the sine 
quo non to attract capital into Russia not only by oligarchs but also 
by more conventional investors.

We will soon learn if Mr. Putin is as smart as his resume indicates. 
Let's hope that he is.


From: Nat Hooper <>
Subject: why is Acting President Putin reffered to as the "Master spy"?
Date: Sun, 02 Jan 2000 

Frankly, as an observer, I am baffled at the almost universal reference to
Mr. Putin as a "Master Spy"? If we (and his political enemies) view that as
a black mark, why was there so little mention of ex-President Bush's
background as, no less, the Director of our own CIA?

I see Putin's remarks to the effect that Communism was out; Democracy,
land ownership and citizen protection was in, though there was a need for
stronger government controls, as right on the mark. I cannot see how anyone
can argue with his view that Russians lack the centuries old legacy of the
Magna Charta and therefor will need more time to develop into a truly free
society. It seems pretty obvious that the past decade of "anything goes"
without legal structure and enforcement was not in the interest of the
majority of Russian citizens. I think it's clear that Russia needs stronger

What's published of Acting President Putin's background suggests that he is
a man of his word - he will do what he says he will do. A refreshing breeze
in the typically fetid atmosphere of politics today - anywhere.

Paul Goble reports that in Washington "...others will now be able to raise
their voices to argue that this is exactly the right time to send Moscow a
message." Evidently Suggesting a stern one. Forgive me, but I totally
disagree. Mr. Putin has held a number of important, responsible positions,
but none that approach the awesomeness of the summit where he stands now,
quite alone. Surely he has enough to deal with at home without us burdening
him any further. Now is the time to offer him friendship and support. I
believe this would go much further towards insuring future peace in the
world than anything that might be perceived as imperialistic intrusion.

Nat Hooper
an interested observer
in Oxford, Arkansas, USA


Boston Globe
2 January 2000
Yeltsin and history 

Exit Yeltsin, not with the bang of standing atop a tank turning back an 
attempted putsch by old-line Soviets, but with a whimper, looking old and 
sick, and asking his country's forgiveness. Part buffoon, part hero, and a 
political operator of great skill, Boris Yeltsin, who resigned his presidency 
on the last day of the old century's last year, will be remembered as the man 
who brought forth a reconstituted Russia from the ruins of the Soviet Union.

He had been a Communist leader in the town where the last czar and his family 
were murdered. And when events overran the Soviet Union's last leader, 
Mikhail Gorbachev, Yeltsin was the man of the hour. He rescued Gorbachev from 
a coup attempt, and managed the nascent democracy that, however tarnished, 
has succeeded the most powerful and long-lived tyranny of the century.

As the empire that Peter the Great had started began to disintegrate and 
break up into 15 countries, Yeltsin pulled together its largest and strongest 
element, the Russian Federation. Peter's white, blue, and red flag flew once 
again over Moscow, consigning the hammer-and-sickle banner to the ashcan of 

If ever a man resembled his country's symbol - the bear - it was Yeltsin. 
Sometimes, it was a large and lumbering circus bear, getting dead drunk, 
falling in rivers after illicit visits. At other times, he was the rearing 
angry bear, swatting his enemies, and nothing can ever take away from him his 
moment of glory rescuing Russia from the hounds who would have restored 

Not quite a true democrat, Yeltsin never had much respect for parliaments, 
but the fact is that, however imperfect, Russia's rulers are elected now by 
popular vote, and that had not been true in the thousand years of Russian 

Yeltsin's last years were dogged by illness and by hints of scandal, and his 
chosen successor, who will face an election in 90 days, is Vladimir Putin, 
whose fortunes will rise or fall in the Stalingrad-like ruins of Grozny, 
where a war rages with no end in sight. 


From: "Yevegeny Ozhogin" <>
Date: Sun, 2 Jan 2000 
Re:, How the West Killed Yeltsin, 2 Jan. 2000

1. Though I, in general, agree with Stratfor's view of their side of the
coin, I'd like to stress that there are other factors, in addition to the
ones listed in Re:, which caused Yeltsin's resignation.

First of all, the Russian people's being fed up with its president whose the
only successful coup was his disgraceful leadership in ruining the Soviet
Union. Afterwards, everything he tried to do ended up in failure (corrupt
privatisation, failure of governmental and economic reforms, Russia's
national ethinic policy, losing Russia's stature in the world arena, just to
name a few). This and many other failures caused immense economic hardships
on the people whose rights and well-being Yeltsin as prsident was supposed
to be a guarantor.

I realise some of the western readers of the JRL would draw my attention to
the fact that it was under Yeltsin that Russia experienced freedom of
speech, election, economy, etc. Well, my answer would be simple enough - by
the time the August 1991 coup d'etat attempt, the people of the then USSR
were so much fed up with Communist rule that they'd have demanded (and, I
believe, gotten) all the above freedoms - Yeltsin or no Yelstin. The course
of history led to that, not Yeltsin. We can only guess how the situation
would have developed, if the democratic reforms had been headed by some
other person.

2. Also I'd like to quote the last paragraph of Re:
"But this much is clear. The fall of Yeltsin represents the end of the
of automatic Russian subordination to Western strategic initiatives. It will
usher in an era of greater confrontation with the West. Yeltsin was
Washington's last real friend in Moscow. With Kosovo, President Clinton
killed him politically. It was the last humiliating straw in the West's
relationship with Russia."

If Washington's last friend in Moscow was the one who "represents... the
of automatic Russian subordination to Western strategic initiatives", then
it is good for Russia that he has resigned.

And if it is such people that Washington wants to be in the Kremlin for the
Washington to be Russia's friend, then God forbid us from the 'friends' like
that. as to our enemies, we'll deal with them on our own.


Washington Post
2 January 2000
An Unhealthy Russia

The Dec. 13 editorial "What Russia Is" argued for remaining engaged with the 
people of the Russian Federation, even in the face of renewed saber rattling. 
A particular area worthy of engagement concerns the health of the Russian 

As the editorial noted, throughout the '90s, the Russian population has been 
shrinking. Longevity has reached a low of 57 years for males. Most affected 
by health concerns are adult males in their most productive years. This 
demographic and public health crisis is unprecedented in a time of peace.

Half of the increased mortality is due to cardiovascular disease -- heart 
attacks and stroke -- reflecting both unfavorable social habits (smoking, 
alcohol, obesity, poor diet) and the inadequate identification and treatment 
of hypertension. Russia also is experiencing an epidemic of tuberculosis, 
with a prevalence more than 10 times that in the United States. Among Russian 
prisoners, the reported case rate is 50 times the civilian rate.

Until now U.S. foreign assistance to social safety net matters in Russia has 
been uneven and, at times, counterproductive. A stable Russia is in the 
interest of the United States. We need a coherent policy and program for 
health assistance to Russia to serve both humanitarian and security goals.

Institute for Health Policy Analysis


January 2, 2000
[for personal use only]
ANALYSIS by Paul Starobin
Vladimir Putin: More Questions Than Answers So Far
He's young and is supported by key elites, but most Russians don't know what 
he stands for or where he's headed

It's not just Western leaders who are scratching their heads. Boris Yeltsin's 
surprise appointment of Vladimir Putin as Acting President comes as a relief 
-- and a question mark -- to most Russians as well. Hobbled by poor health, 
Yeltsin has behaved erratically in recent years, but the younger Putin is 
seen as a force for political stability. And he seems to have sensible 
instincts, if not well-developed ideas, for helping Russia to climb out of 
economic despondency.

But to make progress, Putin will have to rally a change-weary public that 
knows little about him personally and that distrusts established leaders of 
all types. He will also have to have to risk alienating some of the forces 
that have propelled him to power, particularly the big-business titans who 
are largely responsible for the endemic corruption of post-Soviet Russian 
capitalism. Altogether, it's a tall order.

Tapped just four months ago by Yeltsin to serve as Prime Minister, Putin now 
is the strong favorite to triumph in presidential elections set for late 
March. Not many attractive challengers are on the horizon, and the public, 
for now, takes a favorable view of Putin's management of the war in Chechnya.

BEYOND THE BATTLEFIELD. On Dec. 31, the day after his appointment, Putin 
reinforced his tough-guy image by swooping into Chechnya and awarded 
government-inscribed hunting knives to Russian soldiers. But before the 
election, he'll aim to show that he's more than a war leader. He's likely to 
unveil an economic program featuring tax cuts and simplification, and to 
bring in his own team of Ministers.

An important powerbroker in Putin's emerging regime is Anatoly Chubais, a 
familiar figure to Western leaders, who remember him as the guy who led the 
first charge for free-market reforms for the Yeltsin regime in the early 
1990s. These days, Chubais is reviled by many Russians as the architect of a 
privatization program that enabled Russia's new class of business lords to 
buy lucrative state-owned assets at bargain prices. But he has agile 
political skills and long, close ties to Putin. Both are from St. Petersburg. 
In 1996, Chubais recruited Putin to leave a position in the mayor's office in 
St. Petersburg for new work in Moscow.

Putin, 47, has no political base of his own. He has never before run for 
political office, having spent most of his professional life working for the 
KGB. He enjoys support from three of Russia's most powerful elites: the 
military, the reform-minded political class, and big business. But he could 
stumble quickly if he challenges any of these pillars of support.

RUBBER STAMPER? Putin has given the armed forces a free hand to conduct an 
aggressive operation to subdue the breakway province of Chechnya, after the 
Russian army's humiliating defeat in an earlier Chechen campaign launched in 
1994. Although the Kremlin's media shapers cast Putin in the role of war 
commander, Moscow political insiders say his role is largely to ratify the 
recommendations of the generals and present them to the public in winning 
terms. Putin has also cooperated with the military in creating an 
information-control strategy that has kept journalists from learning what's 
really going on in Chechnya.

Nevertheless, liberal reformers such as Sergei Kiriyenko, leader of the Union 
of Right Forces, view Putin as acceptable because he's broadly supportive of 
a market economy and open to advice from Russia's most Western-minded 
economists. This crew, which has intermittently had Yeltsin's ear, hopes to 
persuade Putin that Russia has no choice but to proceed with bold moves in 
such contentious areas as land privatization. To the extent that Putin now 
has any economic philosophy, he leans in favor of the German-style of state 
capitalism that took root in West Germany after World War II. Putin speaks 
German fluently and is an admirer of German culture.

Kremlin-connected business titans have backed Putin because he has 
accommodated himself to Russia's corrupt, crony-capitalist economy. Putin, 
unlike many Russian pols, hasn't been accused of lining his pockets with 
ill-gotten money. But he hasn't seemed uncomfortable with the way the current 
system works, either.

UNSAVORY TIES. His ties to the Russian business mavens loom as his trickiest 
political problem. He owes his standing in part to Boris Berezovsky, who 
controls Russia's most powerful state-owned television channel. But 
Berezovsky is the embodiment of evil for many ordinary Russians -- the 
leading symbol of the gross inequities that have colored Russia's effort to 
replace communism with capitalism. If Putin aims to bust public perceptions 
that he's little more than a creature of Russia's new business elite, he'll 
have to find a way to break with this crowd.

The only powerful organized forces that stand against Putin are the Communist 
Party and a political coalition led by Moscow Mayor Yuri M. Luzhkov. But 
neither has a strong hand. The Communists lack an attractive political 
candidate. Their veteran leader, Gennady Zyuganov, is a paunchy, camer-inept, 
backroom pol who was beaten by Yeltsin in the 1996 political election and 
would be unlikely to do any better this time around.

In the recent elections for the State Duma, Luzhkov challenged the 
Kremlin-backed Unity Party with an alliance that featured former Prime 
Minister Yevgeny Primakov and some powerful regional governors. But the 
coalition, known as the Fatherland-All Russia party, fared poorly in the 
elections and is now splintering. Primakov plans to run for President, but 
he's an aging figure whom younger Russians associate with the Soviet era. The 
Communists remain the single largest faction in the State Duma and may be 
able to muster sufficient opposition to block any programs proposed by Putin. 
But that's not a tactic likely to increase their popularity beyond their core 
support of 25% of voters, many of them struggling pensioners.

HIS TO LOSE. One wild card: Zyuganov could bow to pressure from inside his 
party and not run for President, and then the party could throw all of its 
support to Primakov. But there's a problem with that strategy, too: Some of 
the folks who now support Primakov would bolt if the Communists backed him.

So it's Putin's election to lose. And he's already busy introducing himself 
to the Russian public. In a statement posted last week on a Russian 
government Web site, Putin said he favored a market economy, underpinned by 
"a strong state." He called for the development of "a new Russian idea," 
which he described as an alloy of "universal general humanitarian values with 
traditional Russian values." He said "it will not happen soon, if it ever 
happens at all, that Russia will become the second edition of, say, the U.S. 
or Britain."

The most optimistic way to look at the Yeltsin-Putin hand-off is that it 
reflects the conviction of both men that a struggling Russia needs new, bold 
leadership. In his televised resignation address to the Russian people, 
Yeltsin showed considerable emotion. "I want to ask you for forgiveness, 
because many of our hopes have not come true, because what we thought would 
be easy turned out to be painfully difficult," he said.

UNUSUAL CANDOR. Putin describes the new Russia as a country where the economy 
has nearly halved in the 1990s and where "the real incomes of the population 
have been falling since the beginning of the reforms." He also admits that 
"problems in this renewal process" are "the results of our own mistakes, 
miscalculation, and lack of experience."

Taken at face value, such candor is refreshing. But the Yeltsin-Putin 
exchange can also be seen in dark terms. Russia previously had an election 
set for June. By now giving his Prime Minister supreme powers as Acting 
President, Yeltsin, in effect, preempts a decision that in a healthy 
democracy is made by the people. Moreover, Putin signed a decree that legally 
immunizes Yeltsin and his relatives from any future prosecutions on charges 
of corruption or any other crimes. Cynics see Yelstin's surprise turnover to 
Putin as a shoddy backroom deal to avoid legal difficulties.

Since the Cold War ended, Russia has been unable to develop either the 
democracy or the economy that its people -- and the West -- were so eager to 
see. In the early hours of the New Year, a group of thirtysomething Russians 
sipped champagne and cognac at a Moscow jazz club and talked about the day's 
dramatic political events. Nobody had anything especially negative to say 
about Putin, but the discussion was laced with question marks. Why Putin? 
What does he stand for? To outsiders and Russian citizens alike, the 
country's politics remain as murky as ever.

Starobin is Moscow bureau chief for Business Week




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