January 5, 2000    
This Date's Issues: 4010 4011 4012

Johnson's Russia List
#4011
5 January 2000
davidjohnson@erols.com

[Note from David Johnson:
1. The Independent (UK): Helen Womack, Putin's rivals fear he is leader of KGB 'silent coup' 
2. Patrick Armstrong: CAN WE ALL CALM DOWN?
3. Laura Belin: replies to Solnick, Schotland.
4. Harley Balzer: Re 4008-Solnick/Signatures.
5. Steven Solnick: More on Signatures and the New Election Law.
6. Stephen Blank: Chechnya.
7. Moscow Times: David McHugh, Nation Is Pondering A Putin Presidency.
8. RFE/RL: Andrew Tully, Some Economic Analysts Cautiously Welcome Putin.
9. Boston Globe: Brian Whitmore, In Russia, markets awaken. Putin's ascension stirs confidence, stability.
10. Interfax: RUSSIA'S ECONOMY SHOWS GROWTH OF UP TO 8% IN 1999 - GOVT.
11. Moscow Times: Yevgenia Borisova, In Chechnya, a War Against the Press.
12. AFP: School for descendants of Russian nobility opens in Moscow.
13. Nick Holdsworth: Request for Information: Tibilisi, Georgia.
14. Obshchaya Gazeta: Yavlinskiy on Elections, Chechnya, Political Situation.]

******

#1
The Independent (UK)
5 January 2000
[for personal use only]
Putin's rivals fear he is leader of KGB 'silent coup' 
By Helen Womack in Moscow 

Russia's acting president, Vladimir Putin, appears to be contemplating 
bringing forward elections that could confirm him in his post, thus giving 
the opposition even less of a chance to challenge him. 

Opponents said his tactics were unfair and some analysts thought recent 
events were looking less like a democratic transition than a creeping coup. 
On Monday, in a move that went largely unnoticed as Russians continued to 
celebrate the new year, Mr Putin met Marat Baglai, the head of the 
constitutional court, to seek advice about the election provisions of the 
basic law. The constitution says that if the President retires early, as 
Boris Yeltsin did on New Year's Eve, then fresh elections must be held within 
three months. The election has been set for 26 March but Mr Baglai said Mr 
Putin might ask the Federation Council, the upper house of parliament, to 
bring it forward. 

As it is, with the promoted Prime Minister in the most advantageous position 
and enjoying huge popularity because of the war in Chechnya, Russia's other 
politicians are severely handicapped in the race for the Kremlin. If the poll 
is brought forward, Gennady Zyuganov, Yevgeny Primakov, Grigory Yavlinsky and 
the other hopefuls will have even less time to prepare. 

Mikhail Gorbachev, the former Soviet leader, has said that in such 
conditions, thepresidential elections cannot possibly be fair. They will be 
nothing more than a plebiscite to confirm Mr Putin, 47, a former KGB agent, 
in the second most powerful job in the world. 

The millennium celebrations distracted the world's attention from Mr 
Yeltsin's retirement and what actually happened on 31 December, when Mr 
Yeltsin asked Russians to forgive him for failing to fulfil their dreams, 
remains unclear. Few believe the official version, according to which Mr 
Yeltsin made his decision on impulse the day before he went on national 
television to say farewell to his people. 

One of Mr Putin's first acts after he moved into the presidential office was 
to sign a decree, guaranteeing Mr Yeltsin, 68, immunity from prosecution and 
granting state privileges for life. This strengthened the case of conspiracy 
theorists who argued that since August, when Mr Yeltsin and his daughters 
were implicated in corruption scandals, the ageing President, or his 
entourage, had been plotting to promote an heir they could trust. 

Another possibility is that the successors to the KGB have carried out a 
silent coup, getting rid of an old man who had become a liability. A few days 
before Mr Yeltsin announced his retirement, Mr Putin visited him at his 
country residence and may have made him an "offer he could not refuse". 

A few weeks ago, when he was still Prime Minister, Mr Putin, who has never 
held an elected post, attended a celebration of security service officers and 
told them: "You now have your agent working under cover in the government." 
Many a true word is spoken in jest. Meanwhile, a bronze plaque embossed with 
the face of the late KGB chairman Yuri Andropov, taken down during the period 
of reform, has gone up again near the Lubyanka. 

Admirers of Mr Putin note that he espouses the same values of austerity and 
discipline as Andropov, who briefly ruled the Kremlin after the death of 
Leonid Brezhnev. At a recent congress of the artificially created Unity or 
"Bear" party, which came from nowhere to win second place in last month's 
parliamentary elections, delegates approved two policies. One was to create a 
"young bears'" movement, similar to the old Komsomol or Communist Youth 
League, and the other was to tackle unemployment under the slogan: "Those who 
don't want to work will be made to work." 

That was very much in the style of Andropov, who had the police check queues 
to make sure citizens were not shopping in their working hours. "The fact 
that Mr Putin has a KGB background does not worry me, per se," said one 
Western analyst. "Some of the cleverest people in Russia began their careers 
in the KGB. It all depends on what he does with power, assuming he secures 
it." 

The two sides of Vladimir Putin were clear for all to see when he made the 
traditional new year greeting to the nation as 1999 ended. The tone of his 
voice was as telling as the text. 

He began with a chilling warning to anybody who might perceive a power vacuum 
and try to take advantage of it. Any such attempt, he said, would be 
"decisively crushed". He went on to say that free speech and property rights 
would be guaranteed and he ended on a warm, paternal note, promising that 
dreams would come true. 

Just before the midnight speech, NTV had been showing a documentary about Mr 
Putin's early years in Leningrad, now renamed St Petersburg. Most neighbours 
spoke highly of the quiet, modest young man who used to live next door. Only 
one woman remembered a disturbing detail: that children had been frightened 
of him. 

*******

#2
From: Patrick Armstrong <ab966@issc.debbs.ndhq.dnd.ca>
Subject: CAN WE ALL CALM DOWN?
Date: 4 January, 2000

Echoing Dale Herspring’s and Tim Colton’s call for “better fewer, but
better” (JRL 4008), maybe perhaps now in January 2000 we can calm down a
bit. It turns out that Yeltsin wasn’t going to hang on to power forever
through the Russia-Belarus union or some other rumour we heard much of.
Duma elections were held despite all the theories. Y2K did not launch
nuclear missiles and neither did Russia collapse. The Russian economy
did not melt down; in fact it has just had the best year yet. No
military coups. Russia still hasn’t invaded Georgia or the Baltics. Etc
etc.

Once again, the position of CAUTIOUS OPTIMISM looks pretty good as a
basis for observing Russia – both pessimists and optimists are usually
wrong: the truth is in the middle and, overall, Russia is generally
moving more forward than backward.

By the way, on the current rumour-de-jour, how about this quotation? “I
denounce terrorism, including state terrorism used by the Russian
empire. The latest blast in Moscow is not our work, but the work of the
Dagestanis.” [Interview with Shamil Basayev by Epicentrum news agency
correspondent Petra Prochazkova; place and date not given: Prague Lidove
Noviny 9 September 1999, JRL 3500.]

S novym godom!
Patrick Armstrong
Dept of National Defence Canada

******

#3
Date: Tue, 04 Jan 2000
From: laurabelin@excite.com (Laura Belin)
Subject: replies to Solnick, Schotland

In response to Steven Solnick's query: although the Central Electoral
Commission has not yet posted on its website the text of the new law on
presidential elections, it seems that commission Chairman Aleksandr
Veshnyakov is right about the number of signatures that candidates must
collect (1 million in normal circumstances, 500,000 in the event of early
elections). See "RFE/RL Newsline, 4 January 2000" for more details on the
law.

Not only is Veshnyakov likely to know the law better than Igor
Shabdurasulov, he is less directly involved in Putin's presidential bid than
is the senior Kremlin official. Shabdurasulov may have misunderstood the law
or may have intentionally misstated its requirements in order to bolster the
perception among journalists that Putin's election is inevitable. Rumor has
it that substantial "kompromat" on Putin is likely to be published during
the coming months. Making his election seem like a foregone conclusion could
encourage rivals to cut a deal with him rather than fight a bruising
campaign and release damaging information about the acting president.

A few comments on Joseph Schotland's broad questions about the Central
Electoral Commission. The recent parliamentary campaign (which most agree
was the dirtiest campaign Russia has ever seen) showed that the commission
was not at all effective in creating a "fair" environment. Some candidates
were barred from running for the Duma for failing to declare all their
income and property, while others (such as Yevgenii Primakov and Grigorii
Yavlinskii) were allowed to get away with similar violations. 

Although the TsIK did not have the powers to force media coverage to be
objective, it notably refrained from reprimanding Unity for its highly
unfair use of state resources, including television networks. Late in the
campaign the commission asked the Ministry for Press, Television and Radio
Broadcasting to condemn "unlawful agitation activities" on Russian Public
Television and TV-Center, but said nothing about the equally biased coverage
on the Channel 2 network, Russian Television. 

When other electoral blocs and some observers filed complaints with the TsIK
about Unity's various unfair tactics (such as renting airplanes at
below-market rates for Shoigu's campaign trips), the commission's working
group found the complaints groundless. This suggests that the TsIK did not
try very hard to make sure all contenders were competing on a level playing
field. 

Regional and local electoral commissions did not always enforce a level
playing field either. Although the law explicitly forbids candidates from
engaging in charitable activities during the campaign, Boris Berezovskii was
allowed to do so on a large scale without losing his registration to contest
a single-member district seat. Meanwhile, Albert Makashov was struck off the
ballot in a single-member district a few days before the election for a
minor financial infraction allegedly committed by someone on his staff. This
action would be understandable if the rules on campaign finances had been
strictly enforced for other candidates and electoral blocs, but that was not
at all the case.

*******

#4
Date: Tue, 04 Jan 2000
From: Harley Balzer <balzerh@gusun.georgetown.edu> 
Subject: Re: 4008-Solnick/Signatures

In response to Steve Solnick's quite astute and important query (#4008) 
regarding the election law, I think the discrepancies reflect
characteristic confusion. Today's New York Times repeats the story that
Yeltsin signed a new law with changes eliminating the "reduced"
requirement for early elections. During the Duma election campaign,
Veshniakov put both feet in his mouth by announcing that television would
be barred from providing either negative or positive coverage of any
candidate. This offered a field day for editorial cartoonists for a few
days; it also suggests that he has a penchant for what we would call
"shooting from the hip."

My guess is that the published law will indeed include the change
requiring 1 million signatures. This would be in line with the tone of
what has been done to "position" Putin to win in a lopside (more than a
landslide). Ant it would also fit with the discussion of a date even
sooner than March 26. 

Anyone think that Russians' sense of fairness might finally be affronted
by this overkill? (And overkill, of course, is also Putin's policy in the
North Caucasus.)

Harley D. Balzer
Director
Center for Eurasian, Russian and 
East European Studies
Box 571031
Georgetown University
Washington, DC 20057

*******

#5
From: "Steven Solnick" <sls27@columbia.edu>
Subject: More on Signatures and the New Election Law
Date: Tue, 4 Jan 2000

Since I posed a question about how many signatures the new election law
requires (JRL 4008), I might as well provide the answers, according to the
new law published in Rossiiskaya gazeta (1/5) provides some answers. The
answer raises new question, though.

The law essentially leaves intact key provisions of the 1995 law: the 1
million signature requirement is halved for early elections (Art 36, para
13), and an early election is to be scheduled by the Fed Council "on the
last Sunday within three months of the day of the early termination" of the
Presidential term. (Art. 5, para 4).

This leaves me (and others, I'm sure) wondering: why was Shabdurasulov
bragging in the Times (LA and NY, and elsewhere) about how the new 1 million
signature in the new law would cripple other candidacies? And, equally odd,
why did Baglai tell Putin yesterday that he could see no reason not to
schedule elections "at any time" within the three month period. Both the
old and new presidential election laws are clear on the required number of
signatures and the date. Is there some story behind these odd comments?

Steve Solnick
Assoc. Professor of Political Science
Columbia University

******

#6
Date: Tue, 04 Jan 2000 
From: "Stephen Blank" <BlankS@awc.carlisle.army.mil> 
Subject: chechnya

I'd like to go beyond my good friend Dale Herspring's comments on Chechnya.
Undeniably this is a Russian internal matter and it would be foolish as well
as incorrect to deny the reality of the threat posed by the Chechen
paramilitaries to the residents of the North Caucasus and the integrity of
Russia. That said, there is too much evidence about this war, garnered
from both private nad public sources, that smells of provocation and of
issues much broader than a justifiable effort to deal with a real threat to
Rusisa's integrity. ONe might consult Mark Galeotti's article in the
Washington Post last month, and the close contiguity of the events leading
up to the beginning of fighting in August, and Russian military policies,
e.g. Pristina, the very truculent new draft defense doctrine, and national
security concept. It is precisely due to these larger factors which make
the Russian response utterly disproportionate to the threat and possibly
counterproductive in the long run that shuld excite our interest and shape
an informed criticism of Russian policy in Chechnya.

*******

#7
Moscow Times
January 5, 2000 
NEWS ANALYSIS: Nation Is Pondering A Putin Presidency 
By David McHugh
Staff Writer

Other than press the attack in Chechnya, what will acting President Vladimir 
Putin do with the supreme power placed in his hands? 

Even after Putin's more than five months in power as prime minister, only his 
views about the war and his tough image are well-known. On just about 
everything else, huge questions remain about the course he will take as 
acting president - and as president, if he wins the special election expected 
in March. 

Since President Boris Yeltsin named the previously obscure Putin as his prime 
minister and chosen successor on Aug. 9, the stone-faced former KGB agent has 
pursued the war in Chechnya so single-mindedly that Russia and the world have 
had little opportunity to learn what he thinks about other crucial matters. 

Unless the war in Chechnya goes seriously sour in the next 90 days, Putin is 
the odds-on favorite to win the special election for a four-year term 
succeeding Yeltsin. Even if it does, the Kremlin's ability to spin the news 
from Chechnya by restricting journalists' access and controlling two of the 
country's three major television channels would blunt the fallout. 

Questions about Putin include: 

-As a former KGB agent and head of the Federal Security Service, or FSB, will 
he work for democracy and respect tattered civil liberties - or is a more 
authoritarian regime on the way? 

-As the political creation of Yeltsin's inner circle, or "the family" as it 
is dubbed in the news media, will he break free from them and the 
politically-connected tycoons in their midst? Or will the Yeltsin group still 
influence affairs of state? 

-What will he do about the devastated economy - besides watching world oil 
prices rise and collecting the resulting tax revenue? 

One thing is for certain: Putin intends to wield the same vast constitutional 
powers Yeltsin had under the 1993 Constitution. The opposition Communists 
have pushed to amend the constitution and strengthen the Cabinet and the 
parliament. Putin, however, says that won't be necessary. "We have a very 
good constitution," he wrote in a political manifesto published last week on 
the government's Internet site. 

And since he is not politically and physically enfeebled as was Yeltsin, 
Putin may use his constitutional powers even more actively to dominate the 
legislative branch, where pro-Kremlin parties won a large bloc of seats in 
December's parliamentary election. But to do what? 

In his public statements, he has affirmed his support for democracy and core 
freedoms. "Freedom of speech, freedom of conscience, freedom of the mass 
media, the right to private property - all these basic principles of a 
civilized society will be reliably protected by the state," he said in his 
New Year's address. Themes like "patriotism" and "order" run through the 
speech, however. 

And Putin, who served as a KGB agent in East Germany, has also praised 
Russia's securities agencies, the former guarantors of totalitarian order. 

"The bodies of state security have always defended the national interests of 
Russia," he said in a speech to mark the anniversary of the KGB's founding. 
"They must not be separated from the state and turned into some monster." 

Putin uses the rhetoric of force even when talking about constitutional 
protections. Attempts to violate the constitution, he said, "will be 
decisively crushed." 

His public image is a forceful one, too, with television pictures of him 
riding in a Su-25 attack jet, practicing judo, at which he is a black belt, 
and using criminal slang in promising to "rub out" bandits, even when they're 
"in the outhouse." 

And, during his service as director of the FSB, successor to the KGB, he said 
that environmental groups were being used by foreign spy agencies. 

During his tenure, the FSB pursued treason prosecutions of environmentalist 
Alexander Nikitin and military journalist Grigory Pasko, who exposed sloppy 
nuclear waste disposal practices by the navy. Both were acquitted. 

Political analyst Vladimir Prybylovsky was one of the skeptical voices. 
"There were very few democrats in the KGB," he said. "There will be some 
restriction of freedoms. ... The question is, how tough will the new regime 
be?" 

Another fundamental question is "the family" and whether Putin represents any 
break with the current political order - or simply its guarantor of survival. 
Putin on Monday dismissed Tatyana Dyachenko, Yeltsin's daughter and image 
adviser. 

But since Dyachenko's primary function was controlling access to her father, 
her leaving the Kremlin along with him is hardly a shock. So far, Putin said 
he's keeping Alexander Voloshin, Yeltsin's chief of staff and a member of the 
inner circle. 

Boris Berezovsky, the Kremlin insider and financier, said in a Novaya Gazeta 
interview that he was behind Putin's appointment, raising the question of 
whether Berezovsky and other oligarchs will call the shots. Other members of 
"the family" include Sibneft oil company director Roman Abramovich and banker 
Alexander Mamut, according to Russian news reports. 

Then there's the economic question. Rising oil prices have relieved economic 
pressure on the government, making it less dependent on foreign loan 
assistance and sparing Putin from having to focus on the economy. 

Putin has made forceful statements in favor of market economics and private 
property, but with a definite statist spin. 

Putin, as a top official in St. Petersburg from 1991 to 1996, worked to bring 
foreign banks to the city, and he denounced communism in his Internet 
manifesto. But while he called for a market economy and foreign investment, 
he also urged strong state involvement. 

Some have drawn comparisons to Soviet leader Yury Andropov, who tried to 
revitalize the Soviet economy by toughening discipline, or to Augusto 
Pinochet, the authoritarian Chilean leader credited by some with introducing 
market economics. 

Prybylovsky used the term "authoritarian modernization" to describe his 
interpretation of Putin's views - liberal economics, more repressive on 
personal freedoms. 

*******

#8
Russia: Some Economic Analysts Cautiously Welcome Putin
By Andrew F. Tully

On New Year's Eve, Boris Yeltsin resigned as president of Russia, leaving 
Vladimir Putin as acting president. In the West, Putin is known only for his 
pursuit of the war in Chechnya. RFE/RL's Andrew F. Tully spoke with several 
economists to learn what they expect Putin will do about Russia's battered 
economy. 

Washington, 4 January 1999 (RFE/RL) -- Some Western economic analysts are 
cautiously welcoming the accession of Vladimir Putin as acting president of 
Russia.

But they concede that Boris Yeltsin's hand-picked successor cannot improve 
Russia's economy overnight, and that his true intentions may not become 
evident for some time.

Claude Barfield is a resident scholar in economics at the American Enterprise 
Institute, a Washington think tank. He told RFE/RL that Putin appears to have 
little background in fiscal policy, but stresses that this is not an 
insurmountable problem.

"The one sort of big, silent issue is a lot of the questions of economics, 
and he certainly doesn't have as much background in that. But that's not to 
say that a strong leader can't get good advisers and then act."

Joseph Pelzman, a professor of economics at George Washington University in 
Washington, was less equivocal in his assessment of Putin's abilities.

"Well, I mean, he comes from the right kind of background. He's KGB, or was. 
He's had experience in governance. He's no fool in terms of understanding 
what his constraints are."

But Pelzman says that corruption is so ingrained in Russia, and its financial 
infrastructure is so fractured, that no leader can expect quick results.

"Not in the short run. I mean, no one individual over there can do anything 
in the short run."

Pelzman told RFE/RL that corruption in Russia worsened since the fall of 
communism because of all the money that flowed into the country, including 
money from the International Monetary Fund (IMF). This money, he says, got 
into the hands of people who were interested primarily in "trying to rip the 
system off," as he put it.

"And they're still around, and they will be around even if Putin, you know, 
tries to arrest the major players. But he wouldn't even know who to start 
with because the level of corruption is so deep."

And Barfield, of the American Enterprise Institute, says the world probably 
will not see the "real" Putin until after the presidential election -- 
assuming Putin is elected. He notes that Putin must maintain a steady course 
for the Kremlin in order not to anger Russian voters.

"I suspect that you're really not going to see him tip his hand and show his 
true intentions until and unless -- and I think the chances are pretty good 
-- he receives a substantial mandate from the election."

Barfield says that raises the question of whether Putin has the will to make 
the difficult decisions -- whether before or after the election -- to fight 
corruption and rescue Russia's economy.

"Well, it depends on whether he wants to expend the political capital. I 
mean, the forces of corruption, including some people who are supporting him, 
no doubt, are pretty strongly entrenched."

Barfield was asked whether the determination Putin has used in pursuing the 
war in Chechnya could be brought effectively to improve Russia's economy.

"That's right, as long as he knows what he's doing. I mean, you can be very 
-- you can have a very determined, forceful policy which is wrong. And so 
it'll depend on his ability to educate himself and be educated by sensible 
advisers."

On New Year's Eve, hours after Yeltsin announced his resignation, Keith Bush, 
an analyst with the Center for Strategic and International Studies, a 
Washington think tank, welcomed Putin and bade Yeltsin good riddance. Bush 
called the former president "clearly physically and mentally impaired."

On Monday, he told RFE/RL that Putin's record in the KGB and as first deputy 
mayor of St. Petersburg shows he is an effective administrator. But Bush says 
it remains to be seen whether Putin is a true reformer.

The change of leadership in Russia, meanwhile, does not mean a change of 
policy at the International Monetary Fund. Stanley Fischer, the IMF's first 
deputy managing director, says the fund's decisions are based on policies, 
not people.

The IMF has loaned more than $20 billion to Russia over the past eight years, 
and is now withholding an installment of $640 million until Moscow meets 
conditions on improving its banking and other financial practices. 

*******

#9
Boston Globe
4 January 2000
[for personal use only]
In Russia, markets awaken 
Putin's ascension stirs confidence, stability
By Brian Whitmore, Globe Correspondent

MOSCOW - There was a time when news of Boris N. Yeltsin's resignation would have sent stocks tumbling. But when Russia's mercurial president abruptly left office on New Year's Eve, handing power over to Vladimir V. Putin, the opposite happened: Markets soared.

Russia's long-stagnant stock market rose by more than 19 percent on the news of Yeltsin's resignation, while Russian stocks trading on foreign exchanges also posted significant gains.

Putin, a steely and straight-talking former KGB officer who is now Russia's acting president, seems to provide what investors want most: stability. After a decade of uncertainty under Yeltsin's erratic rule, investors and financial analysts say Russia will now become a more predictable place to do business with Putin in charge.

''I am cautiously optimistic that we will see improvements in the business climate. There will be more stability than under Yeltsin,'' said Margot Jacobs, strategist for the United Financial Group, a Moscow investment bank.

Jacobs added that she expects Putin to be a more hands-on leader than Yeltsin, who left the day-to-day business of government to his aides and bickering Cabinet ministers. ''I expect Putin to be more accessible, and this breeds stability and confidence,'' she said.

But while financial analysts are upbeat about the prospects for stability under Putin, few expect the new Kremlin leader to attack the rampant corruption and cronyism that have plagued Russia for the past decade. 

''In terms of the real business climate, as opposed to the stock market, which is driven by expectations, we are probably looking at a continuation of the status quo. Things won't get much worse because they can't get much worse,'' said Leonid Bershidsky, editor of Vedomosti, a daily Russian business newspaper. 

For most of his second term, the ailing Yeltsin was an absentee president prone to odd behavior and frequent shifts in policy. When he appeared at the Kremlin after long periods of convalescence at his country residence, it was often to fire his government - which he did four times during his last two years in office.

Meanwhile, as a small group of tycoons, known here as ''the oligarchs,'' used their Kremlin connections to build fortunes, fledgling Russian entrepreneurs and foreign investors were suffocated by a corrupt and arbitrary bureaucracy. Left at the mercy of bribe-seeking bureaucrats, a punitive tax system, and courts that could not or would not enforce contracts and property rights, investors have fled Russia in droves.

In a recent statement, Putin pledged to reform Russia's bloated civil service, instill ''discipline'' in government, and fight corruption. Nevertheless, many remain skeptical.

Most analysts say that to improve Russia's business climate and attract investment, Putin also needs to lower taxes and simplify the country's arcane tax system, protect property rights, and strengthen the judiciary, so it can enforce contracts.

''Putin is not some anticorruption crusader, and he isn't somebody who understands that taxes need to be lowered,'' Bershidsky said. ''As prime minister he has done nothing about corruption, and he has actually raised several taxes.''

''It is commonly believed that corruption in Russia stems from the very top, and in this sense we need to wait and see. A lot depends on where Putin's power base is,'' Jacobs said, adding that Putin's relations with Russia's politically connected oligarchs are still unclear. 

Some, however, say Putin has no choice but to tackle corruption. If he doesn't sooner or later, the country will face economic disaster, they say.

Tackling corruption and making Russia's opaque public finances more straightforward would also help Moscow obtain badly needed Western credit. Disbursement of a $640 million loan installment from the International Monetary Fund has been held up since September. Russia has yet to implement the fiscal reforms required for the loan to be released, the IMF has said. The delay, however, came right after a money-laundering scandal in which as much as $15 billion in pilfered Russian funds was alleged to have been diverted through the Bank of New York.

''Russia suffers from a lack of transparency, which is another way of saying that people are stealing like crazy,'' said George Friedman, chairman of Stratfor Inc., a political and financial consulting firm in Austin, Texas. 

''Russia also suffers from a shortage of capital. Right now, nothing is good for business in Russia because a dollar invested there is a dollar lost. If Putin can introduce some accountability this would improve the business climate, but there are powerful interests that will oppose that accountability,'' Friedman said.

Friedman added, however, that Putin was uniquely qualified to tackle Russia's corruption problem. A KGB spy in East Germany in the 1980s, Putin was responsible for facilitating Western investment to revive the ailing Soviet economy. Later, as deputy mayor of St. Petersburg, Russia's second-largest city, Putin was the point man on foreign investment.

''All of Putin's experience has been probusiness. He understands the psychology of Western investors, and he knows what they need,'' Friedman said. ''Putin also knows that nobody is going to invest in Russia unless he gets corruption under control.''

Some here say that the stock market's positive reaction to Putin's ascent to power was more because of relief that Yeltsin left the Kremlin without major upheaval than anything else. 

Investors had been nervous that the end of Yeltsin's presidency - his second and final term was scheduled to end in June - would be anything but smooth. Many here feared Yeltsin would either try to cancel elections and stay in power, creating a political crisis, or that opposition forces would win the Kremlin and initiate reprisals against the old regime and its allies.

But now Putin, who enjoys a startling 70 percent popularity rating, will serve as acting president for three months and is widely expected to win elections tentatively scheduled for March 26. Russia's much anticipated - and feared - transition of power seems to have passed quietly. 

''Investors were waiting to see what would happen when Yeltsin's term ended. There was fear that the end of the Yeltsin era would lead to instability, and this has not happened,'' said Tom Adshead, a political analyst at Troika-Dialog, a Moscow investment bank. 

*******

#10
RUSSIA'S ECONOMY SHOWS GROWTH OF UP TO 8% IN 1999 - GOVT

MOSCOW. Jan 4 (Interfax) - The Russian economy was unquestionably
on the upswing last year, a senior government official has claimed,
saying, however, that the government needs to work hard to sustain this
apparent growth.
Growth of between 7.5% and 8% and a GDP rise of between 1.5% and 2%
"are easy to check, and there is no slyness behind these figures," First
Deputy Economics Minister Arkady Samokhvalov told Interfax.
"It was not the only basis for the growth that import-replacing
production was developing as a result of a sharp increase in the cost of
imports after August 17, 1998, because real economic growth had been in
evidence in 1997 and in the first half of 1998, when there was no
devaluation.
"By the start of last year, certain objective conditions had been
created in Russia for more intensive [manufacturing], and industrial
enterprises had adapted to new, market conditions," he said.
Tax reforms and new legislation, including local laws for
protecting investments, and a rise in world oil prices were also
helpful, Samokhvalov said.
"The main task for 2000 is to sustain and intensify the investment
process in the country, and also to strengthen the positive dynamics of
the population's consumer demand, a trend for which became evident in
1999.
"For example, in March 1999 the average statistical wage could buy
2.39 minimum sets of consumer goods, while in October it was already
3.18," he said.

******

#11
Moscow Times
January 5, 2000 
In Chechnya, a War Against the Press 
By Yevgenia Borisova
Staff Writer

ASSINOVSKAYA, Chechnya -- In addition to keeping a lookout for Chechen 
fighters, Russian troops in Chechnya are alert for other threats: videotapes, 
notebooks and unsupervised reporters. 

At checkpoints like the one at Assinovskaya on the road toward Grozny from 
Nazran, Ingushetia, soldiers searched cars not just for weapons and 
guerrillas. Videotapes were confiscated, the excuse being that the checkpoint 
lacked a VCR to screen them. Every page of written matter was scrutinized. 

By means of bureaucracy, searches and intimidation, the military is fighting 
an information war to influence how the conflict is seen by the public. It is 
a crucial issue because Prime Minister Vladimir Putin's popularity is 
generally viewed as a result of the war's perceived success. 

The result of the military's effort: much blander coverage than during the 
1994-96 war, when hard-hitting television and newspaper coverage by Russian 
and foreign journalists helped swing public opinion against the war. 

The detention by military officials of seven foreign journalists last week 
highlights the difficulties reporters are having in getting an accurate 
picture of events that might enable them to challenge sunny government 
accounts. 

"The image of the successful war in Chechnya from the very beginning was 
linked to Putin's campaign as prime minister and then with the rise in his 
popularity," said Alexei Simonov, head of the Glasnost Foundation 

Journalists from The Washington Post, The Boston Globe, Spain's El Pais and 
other news organizations were detained for 10 hours Dec. 29 after military 
officials said they had failed to get the necessary official permission. 

The government has set up an information center in Moscow, where it offers 
NATO-style briefings and bombing footage. But one of the most successful 
operations is taking place on the ground, as a recent tour through 
Russian-occupied zones showed. 

The only category of journalists who can travel with relative freedom in 
Chechnya are Chechens - but they have to hide their status as journalists 
from soldiers. 

"Once my press card was found I barely escaped arrest," said one Chechen 
journalist who did not want to be identified. "It is also a problem to take a 
satellite phone there." 

Russian journalists who are allowed by the Defense Ministry to go to Chechnya 
often fail to tell the Chechen version of events. Many of them remain at the 
government's press center in Mozdok, far from the combat. 

Those who report from Grozny are limited to the area of a military unit and 
are accompanied by armed men if they leave the unit's area. In the last war, 
journalists often reported from Chechen-held territory - but rarely now, 
after the kidnappings of aid workers and journalists by Chechen armed bands. 

For foreigners, getting the Defense Ministry accreditations to report freely 
from the war zone is extremely difficult. The detained reporters were told 
their Foreign Ministry accreditations were not enough, and that they had to 
have permission from local commanders as well. 

Before the journalists were detained, the group passed through eight 
checkpoints with their Foreign Ministry accreditations. They were stopped at 
Staraya Sunzha near Grozny, said Rodrigo Fernandez, the El Pais 
correspondent. Although they were allowed to look around from that vantage 
point, they were ordered not to speak to local people. However, after a 
radioed message, audiocassettes and photographers' film were confiscated and 
the journalists were taken to Mozdok by helicopter, where they were told they 
had been in the area illegally. They were released after a warning that if 
they violated rules again, their Foreign Ministry accreditation would be 
canceled. 

Subsequently, foreign journalists living at the hotel in Mozdok were told not 
to leave without a military escort. 

"There are no rules here how and where we are supposed to get accreditation 
to go to Chechnya," said one of the journalists, who did not want to be 
named. "There are battles for Grozny. I have to understand what is going on 
there. I have to get there." 

Andrei Babitsky, a Radio Liberty reporter, said that to get to Grozny he had 
to "walk 100 kilometers" to dodge soldiers' checkpoints. For his troubles, he 
was denounced by the government for his reporting. 

The lack of corroborating evidence in the form of TV images has helped the 
government in its attempts to simply deny foreign reports of battlefield 
reverses. For instance, when Reuters and Associated Press journalists 
reported that over 100 soldiers were killed in Minutka Square in Grozny, 
Russian officials flatly rejected the reports as plants from Western spy 
agencies. 

Likewise, the government has disputed reports based on refugee accounts of a 
massacre of 41 civilians by Russian troops at the village of Alkhan-Yurt. 

*****

#12
School for descendants of Russian nobility opens in Moscow

MOSCOW, Jan 4 (AFP) - 
A retro school of good manners for the descendants of the former Russian 
nobility is functioning in Moscow, former capital of the world proletariat.

The "Classic School" teaches the basics of etiquette, such as how to answer 
the telephone, how to introduce oneself, how to behave at a reception or at a 
picnic, or which utensils to use to eat the various courses at a dinner party 
and how to eat a banana.

The school's headmistress, Margarita Shemakhina, herself descended from the 
nobility, says her establishment wants to help Russia to break out of its 
"moral and spiritual backwater."

In the small classrooms decorated with ikons and portraits of the last tsar, 
Nicholas II, 30 children aged between five and 11 come every day to study. 
They are subject to the universal curriculum imposed throughout the Russian 
Federation, but they are also taught subjects that were discarded during the 
Soviet era -- religion, good manners and choreography.

"Russia needs a spiritual elite, that is the role of the nobility. Our 
generation was not given the chance of religious or moral instruction at 
school. When we found out this school was opening, we immediately enrolled 
our children," said a couple of parents who had arrived to collect their 
children after class. "They will be the generation of the future."

The Classic School has been installed in the building of the Assembly of the 
Russian Nobility (ARN) and its charter says its aim is to contribute to the 
"rebirth of lofty values, which were lost against our will."

The children receive instruction in the Russian Orthodox religion, read the 
Bible and start each day with a prayer in front of the classroom ikon.

Shemakhina said that as far as etiquette was concerned, the parents did not 
even know the basic rules. "Sometimes, the children teach their parents the 
elementary rules that were second nature to their forebears.

The teachers use textbooks of the old regime to teach history. "Modern 
textbooks tell lies. It is better to have textbooks which were studied by 
Pushkin, or the history of the Romanov dynasty," said Shemakhina.

The Classic School has been registered by the Russian education ministry, but 
receives no subsidy from the state.

Most schools in Russia are free, but families whose children attend the 
Classic School must pay 1,000 rubles (about 40 dollars) a month for the 
privilege.

"Even so, it is difficult to make ends meet at the end of the month," said 
Shemakhina. "We are looking for sponsors from abroad. In Russia, money is 
considered to be immoral," she said.

The ARN is hoping to enlarge the school to prepare its students for 
university more quickly.

The Russian nobility was decimated during the 1917 revolution and many of its 
members emigrated. But the ARN says it has counted nearly 10,000 descendants 
of the nobility still in Russia.

*******

#13
Date: Tue, 04 Jan 2000 
From: "Nick Holdsworth" <nickh007@online.ru> 
Subject: Request for Information: Tibilisi, Georgia.

I would be most grateful if any JRL subscribers with contacts in Tibilisi,
Georgia, could pass them onto me.

I shall be in Tibilisi from January 17th for several days on assignment to
cover an international conference on education. However, while in town I am
keen to investigate other, more general stories for the various outlets for
which I freelance. I am particularly interested in the current situation in
Georgia with refugees from the Chechen conflict and rumours that Georgia is
a safe haven for Chechen separatists en-route to or from the front.

Contacts with Human Rights agencies, political authorities would be most
welcome. I have not been to the Caucasus during the eight years I have been
covering Russian affairs, so would be grateful for any assistance JRL
readers could offer.

Tips or ideas on decent places to stay would also be welcome!

Please reply to me directly at: nickh007@online.ru

Thanks in advance!

Nick Holdsworth
Times Higher Education Supplement
Eastern Europe Correspondent

*********

#14
Yavlinskiy on Elections, Chechnya, Political Situation 

Obshchaya Gazeta 
30 December 1999
[translation for personal use only]
Article by Grigoriy Yavlinskiy: "The Past Seven Days and I: We 
Defend What Is Essential to People and to the Country" 

The change of year, century and even millennium is, in the final 
analysis, just a numerical change. There are other parameters which are 
much more serious. For example, the moral compass used by those in power. 
Where are we today, viewed from that standpoint? 
When the leaders of the blocs that emerged victorious from the 
election drink a toast to Stalin in the prime minister's office, when the 
executive branch is becoming the puppeteer pulling the strings of the 
legislative, when instead of information people are inundated with lies 
and mudslinging, when campaign tactics turn into war, it is clear that 
what lies in our country's past could also lie in its future. 
I would like to focus in particular on the war in Chechnya, as that 
issue became a crucial one in the election. 
A clear change of objectives has occurred over the past month. Instead 
of an anti-terrorist operation in Chechnya we now see a large-scale war 
that is more reminiscent of revenge than a fight against terrorism. 
Instead of bottling up terrorists and conducting special operations to 
destroy them, criminal ultimatums are being issued, civilians are 
suffering, and the refugee situation remains unchanged. All of this is 
timed to coincide with political events in Moscow, i.e. the elections. 
This kind of "operation" can bring nothing but shame. I have 
spoken with the prime minister about this personally. 
There have been various stages in this war. Our position on the 
actions of the Putin government in Chechnya has changed as events have 
unfolded. The focus of the first stage of the war was to repulse 
aggression by bandits who had attacked Dagestan from Chechnya under the 
banner of religious views. They attempted to change the constitutional 
system and establish a different order. They had planned an operation to 
reach the Caspian Sea and establish a Wahhabite state. (At this point it 
would be appropriate to point out the situation in Kirghizia and 
Tajikistan as well.) It was absolutely essential to establish a security 
zone, as announced by the government at that time, in order to protect 
Stavropol Kray, Ingushetia and Dagestan. At that time our support for the 
government and for military action was completely justified and 
unconditional. 
The second stage of the war involved Chechnya itself. For three years 
the whole world watched as the government that had been formed there 
demonstrated its inability to establish order in the republic. It is the 
scene of human rights violations, has a flourishing slave trade, 
witnesses disappearances, and is home to terrible and inhuman crimes. 
This created an enormous threat to the security of Russian citizens. The 
federal government had to put a stop to all that. 
Troops did in fact begin to advance north of the Terek with minimal 
losses and to occupy positions along the border perimeter. This was a 
correct decision, one that ensured security. At that point in time we 
also took a positive view of this, because it was an operation designed 
to establish a security zone. 
We expected that the next step would be bottle up the terrorists and 
then conduct special operations, either to capture them for trial or to 
destroy them. Instead events began developing differently. The military 
began managing the situation. You will recall their statements at that 
time: "Just try and stop us..." The operation is now in its 
fourth month, yet not a single terrorist leader has been captured or 
destroyed. 
Then they granted amnesty to Gantemirov, a former mayor of Groznyy who 
had been convicted of embezzling public funds, and began arming him. The 
groundwork for civil war in Chechnya was being laid. 
When it became clear that the "anti-terrorist operation" had 
become a smoke screen, we made our statement. The gist of the statement 
was that it is essential to continue military and special operations, but 
that it will be impossible to resolve anything using those methods alone. 
We need to negotiate with the various forces in Chechnya, including with 
Maskhadov, in order to get the republic's population on our side. In 
addition to rooting out terrorism and protecting the security of Russian 
citizens, at the same time we must also achieve a strategic objective: 
after the conclusion of the war order can only be maintained in Chechnya 
if the people who are going to live there can have at least somewhat of a 
normal attitude toward the Russian authorities. But that is incompatible 
with continuous, massive bombardment of cities and villages. Our 
statement was addressed to the prime minister, not to the military. As 
responsible politicians, we discuss with politicians, not with soldiers 
and officers who are prepared to sacrifice their lives if so ordered. 
They fight the way they know how to fight. Our country could not exist 
without them. We have not gotten around to creating a different army yet. 
The statement received a vociferous and extremely negative response 
from the press and from politicians. The reaction from the right wing was 
unexpected. Although Putin soon announced that he was conducting the 
negotiations that we had sought and was looking for a way out, and Shoigu 
announced that he was creating refugee corridors, nevertheless statements 
from the right wing did us a disservice. They helped incite nationalism 
and fascism. And that is a very hard blow at Russia. 
The immediate effect of these nationalist and populist sentiments was 
the appearance of the infamous ultimatum to Groznyy. For two days there 
was not a single political force in this country except for Yabloko that 
dared to say a word about the idea of destroying an entire city together 
with all its people here at the end of the 20th century! 
And how did the country react? The elections demonstrated that by 
standing our ground we lost several percentage points of the vote. We 
greatly regret that. Nevertheless, we feel that we did the right thing. 
The choice that people made indicates that they are confused. Even the 
Moscow political elite does not understand what is really going on. Those 
who are not active in politics were simply manipulated. In that situation 
people's choice is understandable and forgivable. 
We have never kissed anyone's hand or kowtowed to anyone. We have 
remained a party that serves no one except the voters. We have defended 
that which we hold dear. 
The elections demonstrated that Yabloko is the only party in the 
country for which the creation of a civil society is a primary political 
objective. Other forces do not see any practical benefit in this. 
The election campaign was not an end in itself for Yabloko. And 
perhaps in order to please the voters it would have been more practical 
to delay certain steps. But the party did what it considered necessary: 
- put forward a concept for a new economic policy based on a substantial 
tax reduction, and submitted it to the State Duma in the form of an 
alternative budget; 
- warned of the dangers inherent in the treaty signed by Russia's 
president and Aleksandr Lukashenko; 
- defended the law (and justice) and became the first political party to 
win an election-related lawsuit in St. Petersburg; and proposed a plan 
for the political resolution of the Chechnya conflict. 

*******