January 20, 2000    
This Date's Issues: 4049 4050 4051 4052 4053

Johnson's Russia List
#4053
20 January 2000
davidjohnson@erols.com

[Note from David Johnson:
1. Moscow Tribune: John Helmer, THE PRIMAKOV BALLOON.
2. National Press Club: PRESS CONFERENCE WITH DIMITRI YAKUSHIN, SPECIAL ADVISER TO ACTING PRESIDENT OF RUSSIA VLADIMIR PUTIN.]

*******

#1
Date: Thu, 20 Jan 2000 
From: helmer@glasnet.ru (John Helmer)
Subj: THE PRIMAKOV BALLOON 

>From The Moscow Tribune, January 21, 2000
THE PRIMAKOV BALLOON 
John Helmer

Children find it amusing to unknot balloons, and release them to deflate
noisily, as the exiting air powers them briefly around a room, before they
drop.

When Yevgeny Primakov walked out of the Duma chamber at its debut session
on Tuesday, he let the air out of his new parliamentary career, before it had 
even started. 

The gesture, ahead of the vote to elect rival Gennady Seleznev 
as speaker, is portrayed by Primakov's friends and supporters as a protest
against the deal that had been done between the Communists and pro-
government deputies to elect Seleznov. "A total collapse of democracy" was
the hyperbole Primakov used.

His camp insists the walkout wasn't pique on Primakov's part. But 
Primakov himself was already telling his friends, days before the vote on 
Seleznev, that he won't occupy his seat in the Duma for long; probably not 
beyond April.

Noone is saying what happened between Primakov and the leadership of 
the Communist Party, or if they tried negotiating a grand political
bargain from the moment, just before the Duma election, when Primakov
lofted his presidential balloon; and this week, when the balloon collapsed.

Remember that, immediately after the December 19 poll, the Communists 
hinted that they were to ready for a "non-traditional" alliance for the
presidential race. At the time that seemed like a hint at support for
Primakov. 

In theory, an agreement between Primakov and the Communists could have posed 
a serious threat to acting President Vladimir Putin. This also seems to have 
been the Kremlin's assessment.

Primakov's friends say nothing like that was discussed. They deny there
was any negotiation with the Communists, adding that hints there might
have been are nothing but attempts to smear Primakov as a leftist.

The friends acknowledge that Primakov was personally shocked by the
outcome of the Duma poll. His public silence scarcely concealed
the private soundings he took to determine whether he could
expect to do any better with the voters, if he stayed in the race
for the president. When they turned out negative, Primakov decided
he had had enough. Enough of the presidency also meant enough of
the Duma speakership, and of the Duma itself.

This was evidence that Primakov has no stomach for electoral
politics. Reluctant as he had always been to fight openly for power, either as
prime minister or as president, his readiness to take the jobs depended
on his confidence they would be presented to him on a plate. He has
said privately he has endured enough humiliation from ex-President
Boris Yeltsin, from the Yeltsin circle, and during the Duma campaign,
from the Kremlin media. 

While Primakov was frank in his own circle, the Communists cannot be faulted
for judging they could not depend on him. The Duma voting showed 
the Communists lost votes to both Putin and Primakov. In the presidential
poll, that could be expected to happen again. In the first round, due on
March 26, the Communists had to be concerned at the risk that an independent
Primakov run could sabotage the Communist candidate, Gennady Zyuganov, 
allowing Putin a better chance at outright victory. 

>From the Communist vantagepoint, it made better sense to stick to Zyuganov,
and try to force Putin into a runoff.

When Primakov realized he wasn't needed by the Communists, and had no chance
of running without the infrastructure of their support, he decided the game 
was up. When the Communists realized that, they understood their game
depended on getting the best deal they could out of the only other
politician willing to consider Seleznev for speaker. That was Putin.

Putin knew the pro-government faction had no serious candidate of its
own. He accepted that, in the coming presidential election, he can be sure
that voters for Yabloko leader, Grigory Yavlinsky, will be too few to
be threatening; while supporters of the Union of Right Forces will 
inevitably end up in Putin's column, even if they vote for Samara governor
Konstantin Titov first. Thus, in the first Duma vote, Putin figured he
could afford to offend them. So he did.

He was happy to oblige the Communists with backing for Seleznev, if that
helped knock Primakov out of politics altogether, and left Putin to face
a candidate he is certain voters will not prefer -- Zyuganov.

When Primakov walked out of the Duma in protest against Seleznev, he 
did exactly what his political enemies wanted. 

But why, it should be asked, had he never dared to protest so visibly, 
when he enjoyed far greater power, and more public support in his battle 
against the corruption of the Yeltsin regime?

The answer is that, in his final gesture, Primakov demonstrated the 
lack of strength and conviction, which persuaded so many voters to desert him 
last month. Primakov has earned a unique place in Russian politics -- that of
an uncorruptible committed to the national welfare. In parliament this week, 
he deserted that post. 

*******

#2
Yakushin at National Press Club
January 18, 2000
HEADLINE: NPC AFTERNOON NEWSMAKER PRESS CONFERENCE WITH DIMITRI YAKUSHIN,
SPECIAL ADVISER TO ACTING PRESIDENT OF RUSSIA VLADIMIR PUTIN
MODERATOR: LARRY LIPMAN
LOCATION: THE NATIONAL PRESS CLUB, WASHINGTON, D.C.
Copyright 2000 Federal News Service, Inc.

MR. LIPMAN: Good afternoon and welcome to another Newsmaker at the
National Press Club. My name is Larry Lipman. I'm the president of the
National Press Club and Washington correspondent for the Palm Beach Post and
Cox Newspapers.

Our guest today is Dimitri Yakushkin, senior aide to the chief of
administration for the acting president of the Russian Federation.

Mr. Yakushin is one of our own. He was a newspaper correspondent, an
editorial writer, a magazine editor, a television anchor before becoming
press secretary to former president Boris Yeltsin and his deputy chief of
administration.

As always during the question and answer portion of our program, we ask that
you let us know your name and affiliation before asking your question. And
by tradition, we would ask that the first question would come from a member
of the National Press Club.

Please join me in welcoming Dimitri Yakushin to the National Press Club.

MR. YAKUSHIN: Yes. Hello.

I'm a journalist. I was a journalist for almost all my career. I started
working in journalism about 20, 25 years ago. A year and a half ago I was
asked to become press secretary for President Yeltsin. I accepted. I worked
with him for a year and a half. I don't regret this time. It was an
extremely interesting time with Mr. Yeltsin, in particular personally, and
personally for me also because, you know, this time of -- it's a difficult
time, very difficult time, and the stakes, when I accepted this post, were
absolutely obvious to everybody, including to me. But I accepted them. I
don't regret that. I think it was very interesting and exciting even.

And for the moment I haven't left the administration; I'm working with a new
team, I'm working with the new president. I'm not yet press secretary. I
think that you can be press secretary only once in a lifetime, because it's
a very personal job, where you have to establish certain close relations
with the man you're working with. I think that I managed to establish those
kind of relations with Mr. Yeltsin. At least I hope I managed that.

And I thought that this would be kind of a question and answer session,
probably even more off the record, but I see that there are cameras. I'm
used to holding press conferences and answering questions, and this will
make only -- the presence of those cameras and the fact that this is on the
record will make it more official, from my side, for my part, because I'm
not an analyst, I'm not a journalist, I'm a government servant, and that
also casts its influence on what -- how I will respond to your questions.

The last thing I would like to say is that we're entering a new time -- a
new time because not only it's the year 2000 -- it's not yet the new
century, but it's the end of one decade and the opening of another, the end
of a decade during which Mr. Yeltsin was -- occupied the post, number one --
the most important post in the country. And it was not only the fact that he
formally occupied that post, but he was the major politician in Russia, and
he was the most -- strongest politician in Russia. He was a real leader, and
he influenced the course of events in Russia for these 10 years. And
actually how he chose to leave the office -- the moment -- the statement
that he made actually also proves that he still influences Russian politics,
and he's the master of the game. He set the rules.

And even while leaving, even disappearing from public view -- because he has
left, left finally, he has given his office to Mr. Putin, and really
formally given up his office. I mean, he took his coats, he took his
personal belongings, his photos of his grandchildren, books which he liked,
just took it off his table, left the office to Mr. Putin, said, "This is
your place, you're going to work here," not going back to the Kremlin.
That's final. He may have some kind of quarters where he could have a
secretary there, but there is no second -- the important thing is, as some
newspapers speculated right after his resignation, that there will be a
double center of power -- no, he has gone definitely.

And it's a new time. It's a new time. Mr. Yeltsin said very openly that "I
want Russia to enter the new decade with politicians who have new tastes,
with new tastes." Mr. Putin is the new taste. And we're working on his
strategy now. We're working on his platform. And for me, being seriously
important to us is your questions because your questions reflect what is
misunderstood here about what's happening in the country. I can't say that
we all, we, Russians, always understand and can predict what's going to
happen, because Russia is a very complicated country. And, you know, the
last events, Yeltsin's resignation and the results of the elections, the
parliamentary elections prove that Russia is not predictable, that it's very
hard to predict events.

But we're looking for new ideas, we're trying to be open, and that's why
it's important for me to be here and to listen to you, more to listen to you
than to speak myself. So I invite you to ask questions.

MR. LIPMAN: What we'd like to do is have someone from the National Press
Club ask the first question. And please identify yourself. Do you want to
repeat the question or do you want me to repeat it? Whatever you feel more
comfortable with.

First question?

Q I'm a member.

MR. LIPMAN: Okay.

Q I'm Terry Shultz (sp) with Fox News. I'm interested in your giving us your
description of the new security doctrine that was published, I believe, last
Friday in Russia?

MR. YAKUSHIN: Mm-hm.

Q It seems to be much more confrontational than the -- (off mike) -- of
President Yeltsin. Can you give us a little -- (off mike)?

MR. LIPMAN: If you'll repeat the question because we're recording this.

MR. YAKUSHIN: It was a question about the military doctrine which was signed
on -- last week, I think, on Friday or on Thursday -- on the 14th.

It was a document which was prepared a long time ago, and maybe in some
terms it's more, let's say, radical than the previous document. But it's a
thing which is gradually adopted concerning -- in regard with the situation.

I cannot say that I was one of those people who worked on this doctrine, so
here you need really a military specialist on it. But, well, yes, but these
are certain guidelines, but, you know, you really have to speak with
somebody from the Ministry of Defense in order to get an adequate answer on
what really changed.

Q I don't think the use of nuclear weapons is purely a matter of defense.
There is also a very political element to that. And that was apparently one
of the big changes, that now the use of nuclear weapons would be used to
oppose any attack, be it nuclear or conventional. That's a political move as
well.

MR. YAKUSHIN: I don't think there is really radical change between this
document and the one we had before. I don't think so. I think you have to
take the two documents and compare them.

Q (Name inaudible) -- with Knight-Ridder, Moscow.

MR. YAKUSHIN: Yeah, we've met in Kremlin, yes.

Q Yes. Good seeing you. I'm actually interested in a couple of things. One,
as an insider and a man close to the Kremlin, I'd be interested in sort of a
tick-tock on how Yeltsin's resignation came to pass; how long had it been
when it was finally decided.

And also, secondly, where President Putin is going to go and what his
relationship with the so-called "family" of insiders is going to be; how
close is he going to be with Berezovsky, for example, and those Kremlin
insiders?

MR. YAKUSHIN: Well, Yeltsin's resignation was a complete surprise to
everybody, except to a few people, including Mr. Putin; he knew about it
several days before it was announced -- about 10 days. It was not a surprise
for the chief of administration, who knew also a little bit earlier, but
later than Mr. Putin. So it included two or three people. Nobody knew. I
found out about it early in the morning, at around 9:00, 9:30 on the 31st of
December when Mr. Yeltsin already had a meeting with Mr. Putin, with his
chief of staff, and then he called me and he showed that he had signed his
letter of resignation. So it was a complete -- complete secret.

Now, looking back, looking back at some of his remarks, some of his
statements, but only looking back, I could say that something was in the
air. At that time, I didn't have any notion that this was going to happen,
but now when I recall his certain remarks, of different nature, you could
get the idea that this was a thing which was in his head for some time. How
much time, I don't know. Not immediately in August, after he named Mr.
Putin, but maybe something -- September, October, but I really don't know.

One of his remarks, for example, in the week which preceded his resignation;
he made a speech in the Kremlin, when he gave awards to a number of very
prominent people in the country, including the generals who are planning the
Chechen war. And instead of reading a speech -- usually he reads -- he
started talking.

And he talked a lot. And he said that he has been 10 years in power. And he
was kind of speaking about, let's say, the results, results -- drawing the
line. This was one of the recent remarks, which shows that there was
something up.

Another thing; for example, on the 27th of December. That was the beginning
of the week, which ended with his resignation. That was a Monday -- we
recorded, and that was a regular thing. We recorded his televised address to
the nation, which he usually gives on the eve of the New Year.

And it was a good address, but he was not satisfied with it. And he wanted
to record it. Nobody understood why. And finally, when -- (inaudible) --
down the 21st, he really recorded it, but it was an address of a different
nature. He said that, "I am addressing you for the last time" -- and you
know that speech. So that's what I am referring to.

He talked a lot about Mr. Putin's professional capacities also, which also
shows that he thought about, not only leaving, but giving security that Mr.
Putin will be the next president. Well, during -- nominating Mr. Putin, he
openly said that, "I want him to be president" -- and a lot of different
other remarks. But this is only post factum; I mean, no hints -- it was a
complete surprise.

The family, the family. I think it's a notion completely invent -- a
completely invented notion. The family -- there is a -- I don't know if
everybody knows here. There is a -- you know, there are two -- you can
understand differently the notion "family." Family is a -- you know,
"members who are related by blood" to Mr. Yeltsin, right? And then there is
also the family's designated -- there is a term designated to speak about
"people who are close and who actually rule the country."

Well, first of all, his daughter, who is related by blood; she worked with
him in the Kremlin. And she is a very, very, very close aide. And she
played, I would say now -- you can say that -- but I actually always said
that in the open.

She is a major political figure, I think, and she's very professional, very
capable, and she played an active part in the political process in the
Kremlin. I don't mean -- I don't want to say that she ruled the country in
any way, but in the Kremlin staff, during debating different decisions,
talking about what's happening, talking about the situation, she
participated and participated actively.

His chief of staff, Mr. Yeltsin's chief of staff, Mr. Valoshin (ph), a very
capable professional man, who is now the chief of staff for Mr. Putin, and
with whom I work now as an aide, also being described as a member of the
"family." Well he is formally -- informally his closest aide, that's true;
very close, and all the major decisions are discussed with him, and the
decision of the resignation, he was among those who knew beforehand,
naturally.

There is a tendency to include in this word "family" other people who don't
have anything to do with Mr. Yeltsin -- who didn't have anything to do with
Mr. Yeltsin. That was a wish to designate an enemy, to designate a group of
people and to blame everything what's happening the country on this group of
people.

Insiders, I mean people who are close with any politicians, they always
exist and they will exist. And among these insiders is the chief of staff,
his closest aides, and that's true. But there was nothing -- there was
nothing evil, there was nothing -- let's say "devil" in this existence.
That's important.

You referred to also Mr. Putin's relations with --

Q Mr. Berezovsky.

MR. YAKUSHIN: With Mr. Berezovsky. I think that Mr. Putin has -- I'm not
aware of his concrete relations with Mr. Berezovsky because there's nothing
to talk about. I think that Mr. Putin has, let's say, normal relations with
all the prominent members of business elite to which Mr. Berezovsky
belongs -- an active businessman, a lot of energy. Now you know that he
became a member of the parliament; a man seeking public appearances. You
know, there are people who want to become -- who want to remain behind the
scenes. Mr. Berezovsky is not that man. He wants to be in the public. He
does a lot of press conferences, he speaks a lot to the press. Now he's a
member of the parliament, in order to -- you know, to be in the open.

I would say just as any other relationship with anybody else, nothing
special. There was no special relations between Mr. Yeltsin and Mr.
Berezovsky, only formal relations, because Mr. Berezovsky at one time worked
as deputy chief of the Council of Security. But he resigned about a year
ago. So nothing -- I would say that if you would have asked Mr. Yeltsin when
he was in office, "Who is Mr. Berezovsky," well, he would have said maybe,
but for him it's not the -- it's not a man who he deals with there.

MR. LIPMAN: Let's go over here.

Q Dimitri, I'm Steve Goldstein from the Philadelphia Inquirer. Could you
please tell us who has helped form acting President Putin's political
thinking in his life -- in other words, who are the people he's modeled his
thinking after? And could you also tell us a little bit about his own
family, his blood relations, his parents, and what they did and what his
upbringing was like, if you know something about that?

MR. LIPMAN: Can you repeat the question?

MR. YAKUSHIN: Yeah. It's a question about Mr. Putin, his family life, and
who influenced his political views.

Well, I think that one of the men who influenced a lot was Mr. Sobchak,
because for five years Mr. Putin worked as first deputy with Mr. Sobchak
and -- first deputy mayor. Well, you know, Mr. Sobchak did -- had a lot of
political activity, but it was Mr. Putin who was head of the economic
reforms, market reforms, in St. Petersburg for five years before being
called to the Kremlin, where actually Mr. Yeltsin really -- it was at this
time when Mr. Sobchak lost the elections, in '96, and there was a new mayor
in St. Petersburg. Shortly after that, Mr. Putin was called to the Kremlin.
He started working in the Kremlin, and that was there that Mr. Yeltsin
started looking at him more closely, from that period.

Mr. Putin left the KGB on the 19th of August in 1991. That's a very major
step. You know, it was a difficult decision for him, maybe, because he was a
professional officer. He worked all his life before that in the KGB. And the
fact that he left on the 19th of August -- that was symbolic, and the fact
he worked with Mr. Sobchak, who belongs to a certain, well, you could say,
liberal tendency, is also very characteristic -- as first deputy, as first
right-hand man.

He has a wife. He has two daughters. I can't say more because his personal
life is absolutely not in the open. His wife didn't have --

Q Parents?

MR. YAKUSHIN: His parents died recently. Actually, his father, I think, died
when he was nominated prime minister in August, almost -- just a few, or
three days before that nomination. Because his wife didn't give any
interviews yet, I don't know anything about his daughters, and so his family
life, his, let's say, personal background is very -- well, I would say is
not very known now.

Q And his mother died around --

MR. YAKUSHIN: His mother, I think, died before his father.

Now, there are a lot of -- there is a lot of work done by reporters now who
search, but this is really recent. I was just leaving the country. I saw
several articles, like reporters dug up his school, where he went to school,
his teachers, who had forgotten that he was a member, that he was a pupil at
this school. So people trying to find out the communal apartment. You know
what the communal apartment is, you know, when -- especially in St.
Petersburg, most of the apartments are communal. Large apartments divided
into -- shared by several families. Now, he lived in a communal apartment
all his life, and the reporters went to his communal apartments also to
find, but people have changed, moved out, so nothing definite. I know that
German reporters are trying to find his agents in Germany. So this work is
really being done at this actual moment.

Q Is there any KGB leader that he particularly admired or attached
himself -- I understand when he left and the timing of that, but was there
anybody among the KGB's leaders in the recent --

MR. YAKUSHIN: Well, I would say that I remember one of his interviews when
he was -- it was a major interview in the major paper, Komersant, when he
was named director of the Federal Security Bureau, and I think he spoke very
warmly about Mr. Andropov. Well, actually, that's very natural for everybody
who was in the KGB to speak about that. And you know that several days ago
he participated, Mr. Putin, participated in the opening of a plaque, of a,
you know, stone plate on the building of the KGB in Moscow in Andropov's
memory.

And that plate was torn off during the putsch in 1991, as the statue of Mr.
Dzerzhinsky, who was the founder of the KGB right after the revolution, was
torn down. That's it.

MR. : (Inaudible.)

Q Sam Husseini (sp) from IPA Media, two questions.

There was recently a government paper indicating that there would be a
greater government role in the economy. And I believe Putin made some
comments about whether or not -- (inaudible). Can you shed some light as to
what the general economic policy will be? Will there continue to be this
alliance with the so-called Chubais plan, the IMF policies, that have done,
apparently, a good deal of damage to the economy? Or will there be a greater
government role?

And secondly, on the war on Chechnya, what's the thinking on that? I mean,
if you are going to -- that this high-civilian-toll- type of war, is this a
way to convince the Chechens to be part of the Russian Federation? What's
the long-term thinking as to how that is going to pan out?

MR. YAKUSHIN: Your first question was about the economic policy of Mr.
Putin. I can say that it will be a market-oriented policy. I don't think
that he will bring people like Mr. Chubais really into the front because
people like Mr. Chubais, and some others who were the leaders of the
economic reforms, have a very poor standing. They have a negative response
in public opinion.

But these are specialists -- well, who are professionals. And they may be
behind the scenes but not in the way behind the scenes like, you know,
manipulating everything, but giving ideas.

I know that there is work on the economic program. I don't expect that there
will be any very important big declarations on the economic policy, before
the 26th of March, before the elections, because let's say it openly, I
think that a lot of things -- it's a normal pre-electionary period.

And of course, a lot of things will be, well, what you can call populist, in
the best sense of this word. And I think that if Putin gets a good score and
a good political support, because of the results of the elections -- it's
very important how he wins also -- I think he will use part of that support
in order to promote difficult economic decisions, which are very difficult,
because, of course, in spite of the fact that there is a certain
stabilization, there is growth, the inflation is under control, the rate of
the ruble dollar is under control -- at least it's not as bad as it was
predicted -- a lot of things are not as bad as they were predicted. The
budget is fulfilled. There's a profit center, and actually there is extra
money today, which people -- certain ministries tend to use, you know, in
order to raise the pensions, in order to raise salaries, which are very low
compared to the living standards. In spite of all that, of course, the
economy needs radical -- and not very popular -- moves.

I don't think that these moves will be announced during this period in which
we're living now, before the 26th. But after, of course, he must use this
political support in order to promote these things. That's the only way
out -- difficult things, but obligatory.

Q Could you elaborate on those --

(Cross talk.)

MR. YAKUSHIN: Just a second. There was a second question about --

Q Chechnya.

MR. YAKUSHIN: About Chechnya. Major problem, Chechnya, of course -- major,
major problem. A very difficult problem, not only -- from all aspects, not
because it's a military thing, it's combat, it's a war, but of course the
most difficult problem is how you live, how you organize life in the regions
which are already under federal control, because, you know, for many years
people acquired the habit to live there not according to the law -- money
disappeared, money was transferred to the region, money disappeared. It was
an economy which was based on taking people into hostages, you know, selling
them, slavery, open slavery. You know, in our century, things you cannot
imagine, but it exists -- slavery. People -- you know, sometimes people were
kidnapped in Moscow, literally kidnapped, then disappeared, and they turned
out in Chechnya. There was the traffic of apartments. People were kidnapped.
Their apartments were sold in Moscow, and that money was transferred to
Chechnya in order to buy arms, et cetera -- narcotics.

Life completely disorganized. People didn't receive their salaries, people
didn't receive their pensions. A lot of people profited from the fact that
they made holes in the pipelines, which transferred oil, and they sold their
own gasoline. So it's a no-man's land, you know, a really black hole on the
territory of Russia. Uncontrollable, absolutely. No law, only law
established by what we call the guerrilla -- not guerrilla, but the
military, paramilitary leaders, and not one, but several who were in
conflict with each other sometimes.

So this is the most important part, to lead a military operation, which is
also extremely difficult, naturally. Again, I'm not a military commander, I
cannot say when it will be finished. I can only say that the political
leadership today who command the military, including the military, they are
resolved to get the job done, to resolve the questions once and for -- to
resolve the questions once and for all, because, you know, we reached a
certain point when this thing couldn't have been supported, we couldn't live
with it anymore, you know, there must be something final, something
definite. And that's where Mr. Putin's popularity goes from, when he
denounced the Khasavyurt -- I don't know if you are familiar with the
situation -- the treaty signed with the Chechens in '96 -- when he denounced
it, that gave him the first public support because everybody felt that the
Chechnya was a place where money was drained, disappeared and, you know, it
was a criminal state, it was a criminal entity on the territory of Russia.
Something had to be done. And when Putin said -- radically said that we must
finish with this, that gave him his first support.

So the most important thing, the most difficult thing is how to organize. It
may take -- I don't know, maybe we're not speaking about months, we're
speaking about years. And that needs attention, constant attention; that
needs discipline, discipline. Maybe that needs a certain dictatorial --
dictatorship, because, you know, in order to get things done, there must be
order. You know, money must not be stolen. We must stop, for example, the
production of false dollars which came from Chechnya and which spread into
Russia; which came into Russia from Chechnya, for example, these kind of
things.

But in order to do this, you need a very solid control, firm control.

Q May I just follow up on that? I mean, my -- you were saying in years. If I
may ask, but I thought you were saying that the Chechen people will resent
this for decades, for centuries. Is there -- I understand that it might
bolster Putin's poll numbers and so on, but is this a way to convince the
Chechen people to be part of the Russian Federation?

MR. YAKUSHIN: This is not a war against the Chechen people; this is a war
against leaders of the Chechen people who are criminals. The Chechen people
are the first who suffer from these people we are fighting to. That's very
important. It's not a war which is fought for Mr. Putin's popularity. He
didn't start this war. It influences his popularity, naturally, and the
outcome of this war also can have -- will influence, naturally; but it's not
a war for his sake.

MR. LIPMAN: Going here, and then back here.

Q (Name and affiliation off mike.) This is a hypothetical question. There is
a theory that one of the reasons that the conflagration broke out in
Chechnya was because of the amount of oil in the Caucasus, or the Black Sea,
in the Caspian Sea area. And if that is correct or if that played a part in
it, according to a Time magazine article, the largest amount of oil and
natural gas exists in Siberia. Is it possible that ethnic conflicts will
break out there to facilitate access to oil by interested parties?

I mention this only because while I was in Moscow in '92, someone in your
Foreign Ministry had mentioned the possibility that Russia may be reduced to
the size -- (off mike) -- from Ukraine to the Volga, which would then
exclude Siberia, which has that enormous quantity of oil. I'm -- you catch
my -- (inaudible word).

MR. LIPMAN: Please repeat the question.

MR. YAKUSHIN: Yeah. It's a question about the possibility of the tragic
reducing, yes, of Russia's territory because of the richness -- because,
yes, because of its resources located in different regions, and because it's
a multiethnical country, also. I exclude that. I exclude that completely. I
don't think -- Russia will be kept as a whole.

And there is today -- and it's not just my wish; it's not my wish -- it's
based on the fact that there is no danger of ethnic conflicts in other
regions of Russia.

Chechnya is a special case; it's a special -- it has a long history of
confrontation with Russian power, which starts a long time ago. It started
not in the Soviet time that started it. Actually, during the Soviet time, it
was quite calm. It started in the 19th century. And you know, we are
speaking about decades, decades of potential -- potential or sometimes
absolutely open confrontation. It's a special case. It doesn't have any
parallels compared to other regions.

Q (Inaudible.)

MR. YAKUSHIN: No. No. This danger doesn't exist; this danger doesn't --

And another thing is, of course, you have to be very attentive to these kind
of things. You see, the dangers can come from a direction you don't expect.
For example, the powers of regional leaders today are enormous. And we are
speaking about Russians -- I mean ethnically Russians, Russian governors --
who in their regions are the real masters.

Well, there were some crazy proposals from some of them, like introducing
their own currency, like I am talking about a government in the Urals, from
time to time. Well, some of these things are propaganda, but of course you
have to be aware that there must be some kind of a balance between the
central power and the local power.

And the difficulty of the situation is that these governors have grown used
to this enormous power. And to limit to them is also in a way, to limit
support. I remember that Mr. Primakov, when he was prime minister, he made
remarks saying that governors should be appointed because they should be
dependent on Moscow. But that's undemocratic; they are all elected today.

And they are -- well, first of all, it's completely -- it fits into the
democratic process. People elect their leaders. But at the same time, it
makes these ties between central Moscow -- between Moscow, the federal
ministries, and themselves very, very fragile of course. So in theory, you
have to balance, and you have to be sensitive -- but no danger of ethnic
separation.

MR. LIPMAN: Back here. And whoever's tape recorder -- I think this one is --
it seems like it's chirping or doing something.

Q My name is Randall Royer (sp). I'm from Eyeviews.com (sp) You mentioned
that one of the main reasons that the Russian people support the war in
Chechnya is because of the sort of black hole -- that money was flowing into
Chechnya in aid and not coming out, and that that's one of the reasons why
the war is being conducted.

But is that not undermined by the appointment of this guy -- I didn't get --
I forget his name -- Gantamirov or something -- as the new head of Chechen
administration -- his appointment by the Russian government and his being
pardoned of having embezzled all the money that Russia apparently sent to
Chechnya in the first place?

And a follow-up question --

MR. LIPMAN: Why don't we take the first question?

Q Sure, sure.

MR. YAKUSHIN: Yes, it was a question about Mr. Gantamirov, who was in
prison, in jail, recently released. He was -- there were criminal charges
against him. He was former mayor of Grozny, the capital of Chechnya.

Well, I can only say this: that from the part of the leadership in Moscow,
there's a search for leaders, for leaders who can come back and who can work
on the ground. And this search is wide, very wide. And we're searching not
only among officials, former officials, like Mr. Gantamirov; we're also
searching among Chechen businessmen who are very rich, prominent, and most
of them -- a lot of them are in Moscow.

MR. LIPMAN: And there's the follow-up.

Q Yeah. Well, but if Gantamirov had actually been convicted of embezzlement,
I mean, couldn't you have found someone -- if the main problem was financial
and financial embezzlement, couldn't Russia have found someone better to
represent, you know, other than someone who has been actually part of the
problem that you're discussing?

And there have been a few media reports recently about bad morale among the
Russian troops. That was recently in the Washington Post. I was wondering if
the Russian government is aware of that and if there's any sort of a
response to those reports.

MR. YAKUSHIN: Yeah. Well, the first part of the question, I think, I've
already answered. I cannot add anything to that. I mean, it's -- and it's an
open question. Yes, let's say: Why not? But everybody wants somebody
perfect, let's say.

The second question is much more important, of course. The government, the
leadership, the --

MR. LIPMAN: (Off mike) -- question.

MR. YAKUSHIN: Yes, we're talking about bad morale, which is whether the
authority -- where Moscow is aware of that -- very aware, very aware, of
course.

I mean, it's a war, which has all kinds of consequences, including that,
including that.

People get spoiled by successes, by military successes, and that leads -- us
into all directions. They get spoiled because they think that it's an easy
job, but it's not very easy. And the -- further it gets in them, it may get
more difficult -- of course.

And one thing is to move forward, as it was done, but the other thing is to
control the territory, which is back. And that's an enormous problem. I only
can say that -- the leadership tries to do everything to control discipline
also because it hurts everybody.

MR. LIPMAN: Okay. We have got a question back here.

Q Two weeks ago -- (inaudible) -- followed by Vice President --
(inaudible) -- about 20 years ago, was on CNN, and he stated: To my
surprise, being a student of Russia for 20 years, that the Chinese
communists -- I don't know whether she was being cynical -- but the hard
times aside of the Russian economy -- (inaudible) -- was justified. That's
his statement, according to that.

But the question is: About two months ago -- (inaudible) -- news media
reported that up to $80 billion was stolen by -- I call it oligarchs --
(inaudible) -- new -- (inaudible) -- in Russia; all the money that was put
it there by the IMF, the European banks and the International Monetary Fund,
all the Russian support. (Inaudible) -- around -- you are all saying that
that group of people that run the show, since the end of the Soviet Union,
they stole most of it and reinvested it back into Europe and the U.S.

Now, how do you come here? The Chechen people can say the same thing: "You
are a bunch of corrupt government hooligans. And we are the same, but you
are on a bigger scale." How do you answer that? That's one. (Laughter.)

MR. LIPMAN: Can you identify yourself, please?

Q Andre -- (inaudible) -- Communications.

MR. YAKUSHIN: (Inaudible.)

MR. LIPMAN: You have better repeat -- (inaudible).

MR. YAKUSHIN: (Laughs.) It's not a question; it's more a statement, which
leads to the fact that the Russian is in bad shape; money gets out of the
country, everybody steals; everybody is corrupt, especially people around
Mr. Yeltsin. And how can we deal with Chechnya if everybody is corrupt in
Russia? -- something like that.

Well, it's a very complex situation. Let's -- I'll give you several ideas.
Again, if you are not satisfied, you can ask a follow- up.

We are the first -- we, Russians, are the first to be aware of what is bad
in our country. We don't need anybody to show us and to tell us what's
wrong. We know what's wrong because we are the ones who suffer from this.

But first of all, we are interested in building a normal civilized society.
That's a major point.

We are unsatisfied. I would say more: We are frustrated. The rich people,
the oligarchs, you call oligarchs, they are the people who don't want to
leave the country, they want to live in Russia. They don't want to emigrate,
they want to build a Russia. And they understand today that their influence,
their wealth, security, and even personal security of their families, their
chances of prosperity are linked with the fact that everything around them,
that the atmosphere, that the environment should be normal also; that there
will be no social hatred, that people will not get up and organize a
revolution, which we had in 1917. That's in their direct interest.

And I think that Mr. Putin, Putin's government, will take steps into that
direction, assuring security for everybody, for the rich also, because they
are, in a way, the motor of the country, leading the country forward.

The flow of cash out of the country. It's a problem we recognize. We don't
need to read the papers here in order to find that out. That flow exists,
that flow exists. And it cannot exist, because you cannot keep -- even if
you're a small businessman in Russia, you are obliged to go against the law
because the laws are so that if you want to be successful, you should be
against the law. Now, that's silly to you. And then probably the next
question is: Why don't you change the laws? -- of course. Well, that's what
we're trying to do, but that's very difficult. And in order to prosper, in
order to guard your fortune, you have to export it, and that's the flow of
money.

Now, I'm not talking about different kind of criminal offenses, which may be
plenty. But, you know, it's very hard to describe them. Yes, they exist. But
it's not -- you know, what I referred to before is more -- you know, it's a
social economic problem, because you change the laws -- people are not
different in Russia compared to others, they are not more corrupt. They are
absolutely like anybody else. But what makes it subjective is that, let's
say the order of life, how life is organized, that's the essence of the
problem. That has to be changed.

Q Jonathan Landy (sp), Knight-Ridder Newspapers. Some analysts say that
U.S.-Russian relations today are at their lowest point since the end of the
Cold War. There are a whole list of issues on which we disagree.

Russia opposed the nomination for the new head of the Iraq monitoring
mission, someone who is backed by the United States. There are issues
involving missile defense, arms control. Can you talk about where you see,
from the Russian perspective, these tensions -- where you see the causes,
where the causes lie? And second -- and what the most important unresolved
issues are between Russia and the United States? And second of all, can you
talk about the prospects for changing the ABM Treaty, as we're looking for,
as the administration is looking for, to allow for the deployment of a
missile defense?

MR. YAKUSHIN: We want to stick to the ABM Treaty. Our position has not
changed. We think that it's a thing we have to guard. There are not a lot of
things which we consider to be, you know, successful which come from the
'70s. The ABM Treaty was signed a long time ago, and we must do everything
to preserve it because it's a -- maybe, let's say, it assures not -- we can
argue that it's not, maybe, absolutely perfect, but it's something we have,
and we have to do anything -- we have to do everything to keep it, to keep
it that way because any kind of move can destabilize the situation.

You know, I think that I wouldn't be so pessimistic. I'm not a, you know, a
specialist in the U.S.-American relations. I mean, I'm not an analyst who
deals with that because I deal with more with internal issues. I wouldn't
say that we are, you know, at complete -- I think a lot of things are in the
mind more; are more, say, less material, more virtual. I think so. As an
example of, let's say, confrontation, you say where does it come from; well,
Mr. Yeltsin was completely opposed to the Western position and to the
American position on Kosovo. He was irritated by it. In fact, he didn't want
to speak a lot to -- he didn't want to speak to Mr. Clinton on several
occasions. Personally, I mean, he not only -- he made -- he made very, let's
say, firm remarks, but he manifested it in a personal fashion. He was
irritated by the Western position on Chechnya, also, and of course he didn't
feel very well. He said that it was important for him to go to Istanbul and
to say what he wanted to say, and that's why he was so open there and also
firm.

I would look to the future because it's something which is -- it's a page
which just turned. I can only say that there is difference between Mr. Putin
and Mr. Yeltsin. It's a continuation. Mr. Putin is a continuation, but a man
of a different generation, without complexes, more pragmatic. And I think
that we will have interesting developments as soon as he gets president.

And that concerns not only the foreign policy field; that concerns his
relationship with political forces inside the country.

What's more important -- and that's regarding to the economic question --
what's very important for the country, for this -- for the Russian, the
future, is that will be -- this will be a predictable, stable country. There
will not be this senseless confrontation between the parliament and the
executive branch -- senseless. It was struggle for the struggle.

Q I'd just follow up on that. Could you talk about Russia's view of American
unilateralism, Russia's view of this unipolar world? It's something that has
brought Moscow and Beijing closer together. Is this a trend we're going to
see more of -- this kind of reaction against American strength and American
power? And is there a growing concern in Moscow about American influence in
the world today?

MR. YAKUSHIN: I don't think -- I don't think --

MR. LIPMAN: (Off mike.)

MR. YAKUSHIN: Oh, yeah. The question is whether the trend manifestated --
demonstrated in Beijing, where Mr. Yeltsin had one of his last visits, will
continue, and this anti-American approach, as I understand.

Yes, I think that we are -- we will expect -- we will have -- we won't have
any hawkish declarations. We will be firm. We will be firm on what we think
is right, on what we think is our position. We will defend it. But there
will be no, you know, hawkish statements just for the hawkish statements.

We, internally, consider to be ourselves part of the West. We are much more
closer to the West than we are closer to Asia, though there is -- you know,
there are debates in Russia because of -- asking the question whether it's a
Eurasian state and it's looking both to the West and to the East. But we are
very close to the West. I mean, we have the same mentality. We want to live
like people in the West. And I don't think -- it will be much calm, much
more pragmatic, much more work-like in the future.

MR. LIPMAN: Ken?

Q Ken Dalecki with Kiplinger. You mentioned that after the election that
some tough steps will have to be taken regarding the economy. Could you
elaborate a little bit on what they might be?

MR. YAKUSHIN: There will be, I think -- I think -- I'm not an economist. I
cannot talk about that in detail. But I think one of the first things, of
course -- there must be a fight against what we call the criminalization of
the economy -- criminalization.

And that's a wide area; that's a wide area. That's what I referred to, that
in order to be successful in business, you don't have to be against the law,
because once you are against the law, you are open to different kinds of
pressure, racket. And racket is a very wide -- unfortunately, a very wide
notion in our country. It doesn't come from, you know, small groups of
criminals, it can come from the government. You know, in order to open a
restaurant in Moscow you have to have, for example, I don't know, 100
authorizations. And that's a form of racket. It's not a liberal economy in
that sense, see? You have to change the rules. It's very controlled. Taxes,
of course, taxes. The system is anti-business. You hide everything you gain.
You know, you have to pay more than you gain, in some cases. That means a
lot of money goes into cash -- I mean all the money goes into cash.

MR. LIPMAN: Down here.

Q Yes, Dave --

MR. YAKUSHIN: I'm sorry. Yes. And a harsh measure is, of course, bankruptcy,
because that's a major law. I mean, if you're not able to control a plant
which you have acquired -- and that's what's actually happening now. We are
now in the stage of process when the plants are changing, for the first
time, ownership. And it's very hard because the people who own them today
are very powerful and very influential, and they don't want to give them
back; they don't want to give them back. But they cannot control, they
cannot organize production there.

MR. LIPMAN: Dave and then --

Q Yes, if I can ask you about your area of specialization, about the media
in Russia, what you think the state of the media is today. And then in
particular, the role that the press played in the recent Duma elections. And
then we read about biased coverage in the Russian press of politics.

MR. YAKUSHIN: I think that in spite of the faults, in spite of the faults --
I don't know how well you're aware of the situation, but in spite of the
faults, which are evident to people who watch and who work in Moscow, I
think that the media reflects well what's happening in the country. If you
read all the papers, if you look at all the major papers, and if look at all
the news channels, you get the idea what's happening in the country and you
get the idea of the battle, let's say, of ideas, and of confrontation
between groups of influence, between different camps of politicians. So
there is a reflection of that. There is a reflection of economic problems,
there is a reflection of corruption. All the, let's say, major pains of
Russia, they are reflected, so you get an adequate picture.

Now, the problem is that a lot of media is privately owned today. And the
owners of the media are using newspapers, which belong to them, or news or
television stations as a tool for power. They are not, let's say,
specialized.

There is not a specialization in media business. They are not independent
enough -- just to be important prominent media specialized companies. For
the moment, they have other areas of interest. And besides that, they also
have a newspaper, for example, which defends naturally their business
interests.

And so journalists get bought; I mean, they get bought in the sense that
they are bought from one paper to another. They get -- you know, they change
salaries. They are bought in order to fulfill a certain task. That exists;
that problem exists.

A negative phenomenon is of course what we call in Russia informational
wars. They were evident during the parliamentary campaign, which we just
have seen -- lived through -- a negative thing, a negative thing because it
diminishes the esteem of public opinion towards the journalists. They see
that journalists can be used and they are openly used -- openly. That's a
major fault, of course.

MR. LIPMAN: Okay. We have time for one more question.

Q I am -- (inaudible) -- International Reports. And I was wondering with the
sidelining of Yeltsin's daughter, what do you see the role of women in a
Putin administration being, especially with the Duma elections too, of the
power of women in politics seeming to decrease?

MR. YAKUSHIN: Well, there was an idea that the head of the Duma can be
woman, and Mr. Putin actually openly said that: Why not a woman because
women are not represented well in, let's, say official power organizations?

I think that Mr. Yeltsin's daughter, she gives an example to a lot of women
who want to occupy important posts and want to be professionals, and who
want to fulfill what's in them. She gives a good example of that.

But by character, by personal character, she is very timid. She doesn't want
to be in the open. She doesn't give any interviews, even now. There are a
lot of requests. She didn't talk to reporters during her work in office for
three or four years.

Yes, there is -- probably there is not enough presence of women. But I don't
think you have to do it -- I mean, this must be, let's say, a natural
process.

I mean, you know, we had -- we remember the Soviet times when, let's say,
the parliament was divided into parts; we had to have a certain percentage
of workers, a certain percentage of women, a certain percentage of students.
Well, I acknowledge that it's a problem.

But the speaker was not elected a woman. A man who was the former speaker,
Communist, Seleznyov, was elected this day to be head of the parliament, new
parliament.

MR. LIPMAN: Mr. Yakushin, on behalf of the National Press Club, I want to
thank you for coming.

MR. YAKUSHIN: Yeah, thank you.

MR. LIPMAN: Okay.

MR. YAKUSHIN: Thank you.

*******

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