February 15, 2000    
This Date's Issues: 4107 4108 4109

Johnson's Russia List
#4107
15 February 2000
davidjohnson@erols.com

[Note from David Johnson:
1. Cameron Sawyer: Land Reform.
2. Izvestia: OLD CREW MANNING SHIP. Majority of Russians See Yeltsin's Men Still in Power.
3. smi.ru: THE SKURATOV CONFESSIONS: BLACKMAIL IT WAS.
4. Reuters: Clinton says U.S. can ``do business'' with Putin.
5. Itar-Tass: Osce Assesses Election to Duma as Democratic Development.
6. RFE/RL: Sophie Lambroschini: Press Freedom Issue Could Affect Putin's Popularity.
7. MOSCOW TRIBUNE: Stanislav Menshikov, IMF IS LIKE A GIRAFFE. New Ideas Are Generated Slowly and Are Not Necessarily Right.
8. AFP: Superstitions the bread and butter of daily life in Russia.
9. Washington Times: Jamie Dettmer, Economic reformers losing battle for Russian businesses.
10. The Russia Journal editorial: Strength of state.
11. AFP: Russian Business Firmly Behind Putin Presidential Bid.
12. AFP: Russian debt deal gives Putin pre-election windfall.
13. Baltimore Sun: Jeffrey Brooks, Why the empire won't strike back.
14. Reuters: Russian general slams US on missile plan.]

*******

#1
Date: Mon, 14 Feb 2000 
From: Cameron Sawyer <CSawyer@gvasawyer.com> 
Subject: Land Reform

I read with interest the good piece by Sebastian Alison about Russian
land reform. I have been in the real estate business in Russia since
1991 and work with these issues on a daily basis. It bears repeating --
since there is so much popular misconception about it -- that Russian
land is and has been for a long time subject to private ownership, and
the right to private property in land is a well established institution
already in Russian society as well as in the Russian legal system. What
is controversial is not the abstract legal issue, but the practical
question of what to do with farms and agricultural land that is what is
meant by "land reform". The giant collective and state farms from the
Soviet period have not been privatized on a wide scale, unlike most of
the rest of the economy, and there is no consensus about what to do
about it. Agriculture was possibly the most spectacular failure of the
Communist economy, which is saying something, and no one can deny that
reform is needed. But how to go about it? The mass privatization of
other parts of the economy had many undoubtedly positive effects -- if
nothing else, Russia has been thrust irrevocably into capitalism. But
the agricultural sector has even more complicated problems than had the
manufacturing sector at the beginning of privatization, and no one has
any plan for reforming agriculture which promises to produce anything
but chaos in the short term. 

If it were up to me, I would probably divide up the land among the
workers, allow them to freely buy and sell it, mortgage it, whatever,
and just hope that the country could survive the orgy of speculation,
fraud, and general chaos which would go on for at least ten years
afterwards. This is probably no more painful than any other approach,
and gives hope of quicker eventual recovery. But one should not hope
that private property in land is any kind of panacea or will quickly
lead to any kind of investment, or even banks lending money for seed and
equipment -- Russian banks still don't lend money to factories for
equipment even after eight years of private manufacturing. In the short
term there will be little besides speculation and chaos.

But the state-run part of the agricultural sector is practically
nonfunctional anyway already. I think that one should be less, and not
more, concerned about being overly destructive in the approach here than
in the case of the industrial sector -- there is much less worth saving
in the agricultural sector. In fact, there is probably nothing whatever
worth saving. 

In any case, Russia has been through such painful transformations over
the last ten years that no one can blame anyone for being cautious.
It's very good, in my opinion, that this issue is being worked out
carefully through democratic processes.

Cameron F. Sawyer
GVA Sawyer Moscow

******

#2
Izvestia
February 14, 2000
[translation from RIA Novosti for personal use only]
OLD CREW MANNING SHIP
Majority of Russians See Yeltsin's Men Still in Power
By Andrei STEPANOV

Table. Presidential Ratings' Fluctuations (in percent):
--------------------------------------------------------
Date (M/D) Putin Zyuganov Primakov Yavlinsky
--------------------------------------------------------
December 50 15 9 4
Jan. 6-10 56 18 8 3
Jan. 14-17 62 15 5 2
Jan. 21-24 58 16 6 4
Jan. 28-31 58 15 6 3
February 7 57 17 4 4
--------------------------------------------------------
Source: VTsIOM National Public Opinion Research Centre

The main presidential contenders' ratings have been nearly
unchanged in the past week. Not that the 'configuration' is
stable; simply, sociologists have not so far excluded Yevgeny
Primakov from the list of aspirants for the top executive post. 
The above ratings are therefore a bit relative and will be
such for a couple weeks more. When the nation studies the list of
presidential contenders registered by the Central Election
Commission, the picture will change beyond recognition. 
VTsIOM estimates that Vladimir Putin's rating has fallen one
percent last week, while those of Grigory Yavlinsky and Gennady
Zyuganov have grown a percent or two. 
FOM, the Obshchestvennoye mnenie (Public Opinion)
Foundation, another respected pollster, indicates that
fluctuations have been negligible, although Putin's rating has
grown somewhat, in its opinion. 
But then, the FOM report makes a special proviso that the
number of Russians whose opinion of Putin has been spoiled in the
past week, and who believe that his performance as the premier
and the acting president could have been better, is appreciably
large--12-13%. Such is a vision of many well-educated residents
of the largest Russian cities. 
On the other hand, Yavlinsky's popularity in this stratum
has been on the rise. 
That Zyuganov's and Yavlinsky's ratings have grown somewhat
is probably explained by the decreasing number of the undecided
and the growing number of former fans of 'un-promising' aspirants
for the presidency. 
Nearly a half of Russians feel absolutely confident about
Putin's electability: the VTsIOM question of whether the
presidential election could be postponed until the fall of 2001
in view of the absolute clarity of trust, 45% of the polled said
aye, and nearly as many--44%--said nay. 
Meanwhile, the postponement of the election until a later
date would hardly benefit the standing of the acting president:
the number of those who believe that the new leadership would be
able to tackle the nation's burning problems has dropped 9% in
the past month to reach 31%. 
Moreover, 67% of pollees say that now that Boris Yeltsin is
gone, the power is still in the hands of his old team. 
A successful promo campaign is seen as conducive to the
acting president's high rating. ROMIR, another sociological
service, concludes that Putin is well liked because of his
confident statements on the burning issues. 
Affection is known to distort a person's visualisation: 24%
of respondents believe Putin is charming and 22%, attractive.
Which is hardly surprising: there are many more females among
Putin's fans. 
By comparison, Zyuganov is seen as charming and attractive
by 5.8% and 4.2%, respectively. 
The above opinions are probably rooted in the way the
pollees are viewing themselves. Thus, 34% of pensioners say that
Yevgeny Primakov cuts a very attractive figure. 
ROMIR indicates that Putin's electorate are mostly people
with no university degrees and with low incomes of 800-1,500
roubles a month. The share of high and very high income earners
among them is negligible.

*******

#3
smi.ru
19:17 14.02.00
Government
THE SKURATOV CONFESSIONS: BLACKMAIL IT WAS
Excerpts from Yuri Skuratov's book "The Dragon Option" are published in 
Sunday's MK. Among other things, Skuratov confesses that a)the controversial 
videotape depicting his sexual pleasures is authentic and that bin order to 
urge the Federation Council to draw a favorable decision on his resignation, 
he resorted to blackmail. Says Skuratov. 
"+They started considering my case+ Fedorov, not in a manly way, dying of 
curiosity, asked me whether what was shown on the tape, really took place.
I understood that I have to deal with the likes of Fedorov using their 
methods - they don't dig it otherwise - and disgusted as I was, I told him: 
- Nikolai Vasilievich, you are a lawyer. I could tell many interesting things 
about you. So what? 
Fedorov shut up immediately. I had operative information collected by one of 
our special services that the Chuvashian president was meeting a woman in 
Moscow".

Comment: So, now Skuratov told his electorate about that. Although the book 
has been prepared for the elections, it has an enduring human value, being 
very profound. For instance, Chubais (according to Skuratov) uses his 
insider's knowledge about the securities market: "He could always call one of 
his pals and tell them: "Buy the GKO - you won't be sorry! You can make two 
rubles out of one". Other anecdotes are no less impressive.

*******

#4
Clinton says U.S. can ``do business'' with Putin

WASHINGTON, Feb 14 (Reuters) - Despite U.S.-Russian tensions over Chechnya 
and nuclear arms, President Bill Clinton said on Monday he believes the 
United States can ``do business'' with acting Russian President Vladimir 
Putin. 

``What I have seen of him so far indicates to me that he is capable of being 
a very strong, effective, straightforward leader,'' Clinton said in an online 
interview with CNN, based on questions submitted via e-mail and CNN's live 
chat room. 

Clinton's public embrace of Putin was in contrast to some of the private 
concerns held by U.S. officials, who feel Putin is still to some extent an 
unknown quantity. 

``Based on what I have seen so far I think the United States can do business 
with this man,'' Clinton said, echoing former British Prime Minister Margaret 
Thatcher's famous initial assessment of Soviet leader Mikhail Gorbachev. 

Clinton was asked how one could know whether Russia and the United States 
were at peace. 

``Because we're not fighting with them or on the edge of fighting,'' he 
answered. He recounted cooperation to reduce nuclear weapons, and said, ``I 
hope very much that after the next Russian election we'll be able to make 
further progress on reducing nuclear weapons.'' 

One issue that has divided the two countries has been Chechnya, the breakaway 
region where Russian troops have been engaged in a bloody crackdown to root 
out separatist rebels. 

Clinton drew a clear distinction between the conflict in Chechnya, which the 
West has condemned, and Kosovo, where NATO engaged in an 11-week air war to 
dislodge Yugoslav troops and allow ethnic Albanians to return home. 

Asked why Western nations had not ``done enough for Chechnya like they did 
for Kosovo,'' Clinton said: ``I don't think the situations are parallel, but 
I think the Western nations have spoken out against the excesses.'' 

He also stressed that there is a difference between ``the legitimate 
political forces'' in Chechnya and the paramilitary forces there. 

These forces, he said, ``have to bear their share of responsibility for what 
happened as well. I think some of them actually wanted the Chechen civilians 
attacked because they thought it would help improve their political 
position.'' 

Putin became acting president on Dec. 31, taking over from Boris Yeltsin, who 
resigned. He is the leading candidate in Russian presidential elections in 
six weeks. 

Secretary of State Madeleine Albright's recent visit to Moscow was dominated 
by disagreements over the war in Chechnya and a U.S. request for amendments 
to the 1972 Anti-Ballistic Missile (ABM) treaty, which limits missile defence 
systems. 

Russia has opposed amendments, saying the treaty as it stands is the bedrock 
of the arms control regime. The United States says the proposed missile 
defence system is aimed at ``rogue states,'' not at Russia's massive nuclear 
arsenal. 

Albright said after the trip that Putin was more open to U.S. views on the 
subject. She said he also accepted the idea of a linkage between the ABM 
treaty and a START III treaty which would further reduce the size of the U.S. 
and Russian nuclear arsenals. 

The Russians would like to cut the number of strategic warheads to 1,500 for 
each side but the United States prefers a higher limit, in the 2,000 to 2,500 
range. 

*******

#5
Osce Assesses Election to Duma as Democratic Development.

MOSCOW, February 14 (Itar-Tass) - The report of the Organisation for Security 
and Cooperation in Europe (OSCE) sums up the elections to the State Duma as 
an important step in the development of democracy and electoral institutions 
in Russia. The text of the report was presented to the Central Electoral 
Commission on Monday. 

Announcing this at a news conference at Itar-Tass, Alexander Veshnyakov, the 
chairman of the Central Electoral Commission, said the document contains 
conclusions of observers and some recommendations to improve the election 
process. 

Veshnyakov said that during a conversation with representatives of the OSCE 
the question of the presence of international observers at the preterm 
presidential election in Russia on March 26 was touched upon. An official 
invitation to attend the election was made to representatives of the OSCE. 

Veshnyakov said the election is expected to be monitored by half the number 
of observers as compared with the number that attended the election to the 
State Duma. This, however, does not mean that the interest in elections in 
Russia is waning. It is that confidence for Russian electoral processes and 
institutions is growing. 

The course of the Duma and presidential election campaigns needs to be 
thoroughly analysed and summed up, the commission's chairman believes. He 
said the Central Electoral Commission plans to draw up by the year's end a 
report on possible measures to perfect election laws which will take into 
account the lessons of both election campaigns. The report will be referred 
to the State Duma and special parliamentary hearings will be held. "This will 
be a comprehensive all-round assessment of what we come up against during 
election campaigns," Veshnyakov said. 

*******

#6
Russia: Press Freedom Issue Could Affect Putin's Popularity
By Sophie Lambroschini

The Russian government's treatment of missing Radio Liberty correspondent 
Andrei Babitsky has revived the question of press freedom in Russia. RFE/RL's 
Sophie Lambroschini asks Russian political scientists whether the issue could 
influence voters ahead of presidential elections next month. 

Moscow, 14 February 2000 (RFE/RL) -- Freedom of the press is not a burning 
issue for the general public in Russia. But political scientists say the 
growing restrictions on journalists' rights could still erode support for 
acting President Vladimir Putin as he prepares for a presidential election 
next month. 

Russian authorities' treatment of Andrei Babitsky, the war correspondent they 
arrested and then handed over to masked men, has been widely interpreted as a 
blow to press freedom that could herald a crackdown on the press under Putin. 
The government has strictly controlled its release of information about the 
war in Chechnya, and just this week a French journalist (Anne Nivat) based 
there reported that government authorities confiscated her satellite phone 
and her notes.

Political scientist Sergei Markov told RFE/RL that most people consider 
freedom of speech less important than non-payment of salaries, personal 
safety, economic growth, and national pride.

However, says Markov, most Russians do support press freedom. And he says any 
politician can lose popularity if journalists begin to perceive him as a 
threat to their work.

"But this problem is very important for journalists who play a very important 
role in forming public opinion. In a democratic society it is very dangerous 
for a politician to fall out with the journalistic corps. He immediately 
exposes himself to thousands of small blows that in the end can destroy any 
politician. That's why it would be very unpleasant for Putin if he ends up on 
bad terms with the press."

Heritage Foundation expert Yevgeny Volk thinks that the "Babitsky affair" has 
become, to some extent, a dividing line indicating Putin's backers. 

"For the people who have something to do with politics, of course the 
Babitsky issue is a kind of litmus paper that tests the sympathy or the 
antipathy towards the new regime that now appeared after Yeltsin leaving his 
presidential post." 

Putin's apparent apathy about Babitsky's fate could jeopardize his support by 
the Union of Right Forces (SPS), a group of reformist politicians supported 
by pro-Western, democratically oriented voters. Influential party member 
Anatoly Chubais, head of Russia's electrical monopoly, this week called the 
authorities' attitude about Babitsky a mistake and said it would have 
negative consequences. 

A tactical alliance between the pro-Putin Unity faction and the communists in 
the Duma last month had already spurred the Union of Right Forces to disavow 
some of Putin's actions. And the Heritage Foundation's Volk says that the 
Babitsky affair may cause that party to move further away from Putin.

"In recent days the right-liberal flank has amassed a lot of questions about 
Putin. And the unconditional support that it decided to give Putin during 
parliamentary elections as Russia's [future] president is no longer as 
clear." 

Political scientist Markov says that although the treatment of Babitsky is 
worrisome, it is still too early to draw pessimistic conclusions about 
Putin's future policy toward the media based on this one incident. But if the 
standoff between Putin and the media continues, Markov says, then more 
repressive actions could result.

"The more Vladimir Putin clashes with journalists, the more he will be 
hostile to democratic institutions as a whole. The more he is criticized by 
the media, the more he will want to tighten the screws a bit on [their] work. 
That's why the conflict between Putin and journalists is a very important one 
and dangerous for both sides."

Markov says it seems obvious that Putin will never possess the equable 
attitude of his predecessor, Boris Yeltsin. He points out that Yeltsin came 
to power under perestroika, freedom of speech was still the main issue for 
Soviet society. He says this is not true for Putin, who needs the media much 
less. "You can say that Boris Yeltsin came to power on a wave of public 
opinion support that was to a large extent forged by the press that supported 
him. While Putin came to power on a wave of tough policies -- he was 
supported by the population as a civil servant who was not afraid to make 
important decisions. Journalists did not play a role in Putin's ascension to 
power. Even during the parliamentary election campaign, when the media 
supported Unity, Putin's bloc, and supported Putin himself, this was less the 
initiative of the journalists themselves than that of their management, those 
oligarchs who now control the media. That's why Yeltsin was always grateful 
to journalists while Putin has nothing to thank them for."

So far, press freedom has not shaped up as an issue in the March 26 
presidential election. Andrei Ryabov, a consultant with the Carnegie Fund's 
Moscow branch, says he thinks that restrictions on press freedom would 
influence only the pro-reform voters.

Those voters, who are concentrated in Moscow, St. Petersburg and a few other 
regional capitals, comprise no more than 20 million of Russia's 108 million 
voters. 

*******

#7
Date: Mon, 14 Feb 2000 
From: "stanislav menshikov" <menschivok@globalxs.nl> 
Subject: IMF IS LIKE A GIRAFFE 

"MOSCOW TRIBUNE", 15 February 2000
by Stanislav Menshikov
IMF IS LIKE A GIRAFFE 
New Ideas Are Generated Slowly and Are Not Necessarily Right

The giraffe is good looking from a distance but not famous for new ideas.
One reason is that its brain is too far above the ground it takes quite a
while and high pressure for new blood to get there. Of course, nobody
expects much from a giraffe. But the IMF, while on par with the giraffe in
terms of ideas, is constantly looked to not only for money buy also for
wisdom. No wonder that it flops too often.

Consider the latest tranche of advice given to Russia instead of the
promised tranche in money. "Angry", as usual with "sluggish reforms", it
recommends boosting cash payments for utilities, adopting new bankruptcy
laws, and using more credits by the government from commercial banks.
Unless these "crucial structural reforms" are completed, the IMF is not
prepared to disburse the promised money.

To start with, it is a gross overstatement to call such reforms "crucial"
and "structural". Crucial for the economy today is reforming the banking
industry, reviving financial markets, improving infrastructure for capital
investment, overhauling the tax system, cleaning up land legislation. None
of these are mentioned on the IMF list.

Four years ago I happened to be on a discussion panel in New Orleans
together with an IMF official who was then monitoring Russian reforms. At
that time, the Fund was pushing housing reform, i.e. demanding a drastic
rise in rents. The proposal was and is totally unrealistic because wages
and other personal incomes were and are much too low to make that reform
feasible. No wonder that though supported by Chubais, Nemtsov and other top
government officials, it never came through. 

On the panel, I indicated that Russia badly needed other reforms, and
singled out changes in banking, improving the cash payments system and
reducing barter as the most necessary reforms, rather than raising rents.
The response of the IMF man was typical: why burden Russia with new reforms
when it is unable to accomplish old ones. It was like a doctor insisting on
an eye operation before removing a cancerous tumour, simply because it was
the first on his list.

By now, the giraffe has long dropped the fatal housing reform and realised
that setting cash payments straight is more important. But it still fails
to see how this can be done when Russian banks are unable to perform their
prime function of organising payments in the economy. It still treats the
utilities (gas, electricity and railroads) as the principal culprits of the
barter malady. Incidentally, due to the current economic upturn, barter in
the economy has receded, the share of cash in the revenues of companies
(including the utilities) increased substantially, overdue payables in real
terms have been falling for 16 months in a row and are now 37 per cent
lower than in mid-1998. To quote the Russian-European Centre for Economic
Policy (RECEP), "monetisation of the economy is increasing and the arrears
crisis is dissolving".

So the giraffe is now demanding something that it ignored for years and
that is happening today because the new government has rightly ignored IMF
advice and is pursuing a more active fiscal policy. The giraffe obviously
wants to be there and share the limelight. But it still does not understand
much about the Russian economy when it asks for enforcing bankruptcy
regulation and for the government to borrow more from commercial banks. 

Tightening bankruptcy legislation when the financial health of Russian
enterprises is improving looks like beating the patient over his head when
he feels strong enough for the first time to walk around the hospital room
rather than stay in bed. Bankruptcy procedures are important at the right
time but not at the start of an economic recovery.

As to government borrowing from banks, one needs to understand both their
current possibilities and the recent history of their relationship with the
government. As mentioned previously in this column, commercial bank assets
in real terms are badly lagging in real growth behind output. Their ability
to finance the real sector is inadequate. At the latest count, banks are
lending to the government nearly as much (93 per cent) as to the private
sector, much higher than 75 per cent a year ago. Increasing the
government's share even further would rob the real sector of funds, help
sabotage economic recovery.

Also, in the past, banks have been ripping the government dry, and Mr.
Kasyanov rightly wants to reduce their "services" to a minimum. So why does
the IMF keep giving Russia incompetent advice and why is the government
listening? Mr. Putin recently explained our attitude by quoting an old
proverb: "Take it when you are given, and flee when beaten". In other
words, as long as there is chance of getting hard cash from the IMF, there
is sense to continue talking. But by giving the wrong prescriptions all
along and acting like a Shylock in actual lending, the Fund is also
"beating" Russia. The only hope is that the government will simply shrug
off the nonsense it hears from the Fund. After all, it is only a giraffe.

*******

#8
Superstitions the bread and butter of daily life in Russia

MOSCOW, Feb 14 (AFP) - 
Students don't wash their hair the day before exams, musicians take similar 
precautions before a concert, and if you take your rubbish out after 
nightfall you risk losing all your money.

Superstitions play a major part in Russian daily life particularly in rural 
areas where people prefer to observe at times irrational traditional beliefs 
rather than swallow the arguments of a more scientific approach and chance 
their arm against fate.

Even in major urban areas, superstitions govern the lives of many.

"I always enter stage on my left foot," said an actress with a major Moscow 
theatre company.

Passing the salt directly by hand to your dining partners risks starting a 
quarrel. The same is true of soap and knives. They have to be set down on the 
table instead.

"Spilling salt at table brings bad luck and to counteract it you have to 
throw a pinch of the spilt salt over your left shoulder where the evil spirit 
is," explains Russian language teacher Svetlana.

Once Russians have gone out, they avoid entering the house again to pick up a 
forgotten object. If it is unavoidable, a return to the house is possible but 
only if before leaving again, they look in a mirror.

"But I don't believe in the mirror. I never go back in," said Marina, a young 
woman from Saint Petersburg.

One shouldn't offer animals, handkerchiefs or watches as presents to close 
friends and family as they can bring on a separation, and for the same reason 
people do not not kiss in a doorway.

If a knife falls to the floor, it is a sign that someone male will come to 
visit. Drop a fork or a spoon and someone female will soon appear.

"If you don't want them to come, you have to immediately knock three times 
with the utensil on the table and say 'stay at home'" said interpretor 
Mikhail Viktorovich.

Sitting at an angle to the table can bring seven years without marriage, and 
breaking a mirror is a sign of oncoming death.

It is an ominous sign to meet a woman with an empty bucket as you leave your 
house, as it is to see a black cat crossing the road. In such cases it is 
advisable to pinch a button of your clothing between thumb and index finger.

The poet Alexander Pushkin (1799-1837) is supposed to have returned home 
after seeing a black cat cross the road rather than tempt fate.

When one moves house it is advisable to let a cat into the new residence 
before moving in. The cat will then come into contact with the spirit of the 
house, the "domovoi".

If you lose an object at home, put a sweet in a corner for the domovoi. Once 
it has helped you to find the item, you must take care to throw the sweet 
away.

Many rituals are linked to death. On the ninth and 40th day after the death 
of a relative, the family leaves a small glass of vodka and a piece of bread 
on the corner of the table, to help the soul's journey.

If someone is about to go on a trip, all the members of their family should 
sit with them in a few seconds' silence before they leave home.

Many of these superstitions are known in other parts of the world, but in 
Russia they are very popular and part of the social game.

A few months ago, the former prime minister Yevgeny Primakov, when welcomed 
in the provinces, was offered a cutting instrument as a present. Without 
delay he took a few rubles from his wallet, "so that friendship would not be 
cut."

*******

#9
Washington Times
February 14, 2000
Economic reformers losing battle for Russian businesses 
By Jamie Dettmer 

MOSCOW — Businessmen associated with the more egregious Kremlin graft of 
the 1990s are winning out in the struggle with the country's economic 
reformers for influence over acting President Vladimir Putin and for control 
of the country's major state-run businesses.
Economic reformer Anatoly Chubais and his allies have suffered a series 
of reversals in the lower house of parliament — the State Duma — on votes 
coordinated between the Communists and the pro-Putin Unity party.
They are also on the losing end of a battle for board seats on Russia's 
mammoth state-owned companies. Mr. Chubais himself risks losing control of 
the national electric company.
The undermining of the Chubais-aligned Union of Right-Wing Forces and of 
the reform-minded Yabloko party augurs badly for U.S.-Russian relations, and 
for the International Monetary Fund's continuing efforts to get Moscow to cut 
back state control of the economy.
Mr. Putin offered assurances last month that his deal with the 
Communists to let Gennady Seleznyov remain as Duma speaker would not develop 
into a long-term legislative alliance.
But the cooperation between Communists and pro-Putin deputies has 
continued, prompting fears that parliament will block the opening of the 
economy to genuine commercial competition.
Mr. Chubais, who was the architect in the 1990s of Russia's 
privatization program, has been outmaneuvered, not only in the Duma, but also 
by Boris Berezovsky, the business tycoon frequently linked to corruption 
scandals that marred the last years of Boris Yeltsin's presidency.
Mr. Chubais has faced increasing Kremlin criticism of his stewardship of 
the national electric power company, Unified Energy Systems.
Last week, Mr. Putin himself described UES as an "unstable and 
disorderly state mechanism" and said a proposed boost in its utility rates 
would not be necessary if the company had been better managed.
The attack prompted speculation that Mr. Chubais could soon be stripped 
of his post as UES chief executive.
The electric company is not the only state-owned economic colossus that 
is being targeted for change at the top. The huge natural-gas monopoly, 
Gazprom, and Aeroflot airlines are also the subject of behind-the-scenes 
maneuvering.
Eight new candidates have been put forward for seats on Aeroflot's board 
— all of them allies of Mr. Berezovsky. The business daily Vedomosti 
predicted last week that Berezovsky pal Alexander Krasnenker would be 
appointed the airline's general director this spring.
Mr. Berezovsky has also made himself useful to Mr. Putin by ensuring 
that ORT television, which he controls, provides favorable coverage of the 
acting president's military campaign to suppress separatist rebels in 
Chechnya.
The battle for control of the resource monopolies and other big 
state-owned businesses — all of which work through influence and power rather 
than through the markets — is crucial to the management of the economy.
In another sign of weakening power, Mr. Chubais acknowledged last week 
that he will not play a part in Mr. Putin's election campaign, either as an 
adviser or strategist.
He made light of the fact by saying Mr. Putin was so assured of victory 
that he didn't need his help. But on the same day, Mr. Putin expanded his 
campaign team with several people who worked with him in the mid-1990s when 
he was deputy governor of St. Petersburg.
It has emerged, meanwhile, that Mr. Yeltsin's daughter, Tatyana 
Dyachenko, an important Berezovsky ally, has been attending weekly campaign 
sessions in the Kremlin.
She was dumped from her Kremlin post just last month along with the 
Kremlin's property manager, Pavel Borodin. Both are at the center of a major 
Swiss-kickback probe. Mr. Putin's spin doctors put out word at the time that 
her dismissal demonstrated how eager their man was to clean up corruption at 
the highest levels.
Mr. Chubais is unpopular among ordinary Russians and blamed for 
overselling the benefits of capitalism and economic reform. Much of the 
criticism deals with the way he sold off state companies to insiders and 
former Soviet bosses.
"I had to choose between the Communists and the robber barons," he 
explained at the time. Some see him as a robber baron himself, but he and his 
allies in the Union of Right-Wing Forces and Yabloko are the only ones 
arguing for deep economic reform and integration with the developed world.

*******

#10
The Russia Journal
February 14-20, 2000
Editorial 
Strength of state

Most people agree that Russia needs a stronger state. Even some of the most 
level-headed economists in the country say that the government needs to 
strengthen its grip by providing stricter governance before reactivating the 
reform process.

That is fine as rhetoric. Russians have largely associated the decline in 
their fortunes – repeated runs on their money, banks going bust and the state 
offering no security or protection – with the former president’s inability or 
lack of interest in maintaining the strength of Russian institutions. 

But nothing could be further from the truth. 

Those talking about the failure of institutions and endemic government 
corruption are the very people who have presided over Russia’s decline for 
the past nine years. Moreover, the power in the hands of the various state 
organs in this country has only strengthened since the Soviet era, and even 
today the infringement of personal or corporate rights by the state (a common 
occurrence) hardly ever goes punished. Russia’s real problem is not one of 
weakness or strength – authoritative or legislative – it is the complete lack 
of any ethical or moral code in public life and in society in general. 

Russia has few ideals, fewer idols and almost no cultural heroes. There is no 
one to look up to, no guiding spirit in the country – and, to top it off, 
this vacuum is being filled by cheap Western culture.

The Orthodox Church, despite some revival in the past 15 years, is 
unfortunately bound up in the corruption and cynicism that pervades Russian 
life today. As a result, it has failed in what should be its central mission: 
to give moral and spiritual leadership to a depressed population after the 
collapse of the socialist idea. 

Today, Russian cultural figures – once in the vanguard of the people's fight 
for freedom – cheapen themselves by lining up to endorse one, and then 
another, presidential candidate. They expose themselves to ridicule and 
disrespect from the population but are so out of touch that it does not seem 
to embarrass them one little bit.

Business leaders are busy covering their tracks to protect their ill-gotten 
gains. And those who attempt to make an honest living are busy fending off 
draconian state institutions that demand compliance with ridiculous rules and 
regulations. 

Meanwhile, the population looks on as the fortunate few make vulgar displays 
of their wealth – and equally vulgar displays in spending it.

But the truth is that none of this fits with the true Russian spirit: the 
spirit of good-humored tolerance, an ability to share and an almost poetic 
response to adversity – a spirit with a strength and endurance that is 
unparalleled in human history. The Russian individual is both the greatest 
asset and the greatest institution of this country. It is the spirit of the 
individual – weakened from repeated attacks by the Communist state and its 
successor – that needs to be fostered and strengthened. 

Russians have long been over-governed because their masters don't trust them. 
Yet, paradoxically, the people have always been willing to make a supreme 
sacrifice for their land, their God and their comrades when the situation is 
really critical. Why then must they be subject to constant hindrance and 
interference from bureaucrats who are not even the elected leaders of the 
state? 

Russia needs a stronger state – caring and assertive about the interests of 
its people and their lands. But first it must strengthen every one of its 
pillars of strength lest the whole structure collapses. The answer to the 
riddle of a national idea capable of solving society’s ills has always been 
close by. Strengthening of Russian values, putting spiritual values over 
material wealth, guaranteeing human rights and letting people live in the 
contemplative peace that comes naturally to them should be the real Russian 
idea.

The test of a true leader – of the next Russian president – will be his 
ability to guarantee those freedoms and, at the same time, offer moral and 
authoritative guidance to strengthen the free enterprise, free thinking and 
free expression of a free people. In the final analysis, what Russians really 
demand are strong spiritual leaders, not stronger governments.

*******

#11
Russian Business Firmly Behind Putin Presidential Bid

MOSCOW, Feb 14, 2000 -- (Agence France Presse) Russian business is firmly 
supporting Vladimir Putin's bid for the Kremlin, with 43 percent of company 
bosses promising the acting president their vote in March elections, 
according to a poll published on Monday.

Putin's rating jumped seven percentage points from a survey conducted at the 
end of January that showed his support among captains of industry falling 
sharply to just 36 percent, according to the survey by the ROMIR center 
carried in the Vedemosti daily.

But Vedemosti noted that the clear favorite for the March 26 poll had stopped 
the rot and won back support, probably through his support for the free sale 
of land, as well as the capture of the Chechen capital Grozny by Russian 
troops.

Putin was also helped by former prime minister Yevgeny Primakov's decision to 
drop out of the race, announced on February 4, Vedemosti said.

Primakov nonetheless was given five percent of voting intentions, as was 
liberal leader Grigory Yavlinsky, with Communist leader Gennady Zyuganov 
getting just four percent.

The poll of 260 company bosses and their deputies in 12 Russian cities was 
carried out during the first week of February. 

*******

#12
Russian debt deal gives Putin pre-election windfall

MOSCOW, Feb 14 (AFP) - 
Russia found itself with economic breathing space Monday after securing a 
landmark debt relief deal with foreign banks that was hailed as a 
pre-election triumph for acting President Vladimir Putin.

Finance Minister Mikhail Kasyanov trumpeted the accord to restructure some 32 
billion dollars of so-called London Club debt as a vital step toward 
restoring confidence in Russia's financial system.

Kasyanov, seen as a possible prime minister if Putin wins presidential 
elections in March, vowed to push for a similar deal later this year with 
government creditors grouped in the Paris Club, to which Russia owes more 
than 40 billion dollars (euros).

"Settling all problems related to the Soviet-era debt will be a good move 
toward rebuilding the confidence of foreign creditors and investors in 
Russia," Kasyanov told Interfax on his return from Frankfurt, where the deal 
was hammered out with commercial bank creditors grouped in the London Club.

Analysts said the deal was a windfall for presidential favourite Putin and 
his right-hand man Kasyanov, reflecting well on their economic platform with 
less than six weeks to go to Russia's second post-Soviet presidential 
election.

The agreement writes off 36.5 percent of the 31.8 billion dollars of debt, 
and reschedules the remainder over 30 years, with a seven-year grace period.

The overall effect is to reduce the commercial debt burden by some 50 percent 
in real terms.

But it also put the onus on Moscow now to meet the new repayment schedule, as 
the Russian government has finally accepted the debt as sovereign, and can no 
longer dismiss it as the unfortunate legacy of the Soviet era.

The confidence that this inspired sent investors rushing to snap up the 
principal debt (PRINs) and interest notes (IANs) due to be restructured, and 
prices of the paper jumped in London.

A three-percent stock market rally petered out by the end of the day, 
however, while the ruble remained steady at 28.77 to the dollar.

"It's unequivocally good news from a debt standpoint,," said Bank of America 
economist Juliet Sampson. "The government has taken responsibility for 
Soviet-era debt in a more explicit way than previously."

Analysts noted that the deal also increases the interest payable on the debt, 
implying higher repayments in earlier years. This, they said, proved that 
Putin was keen to stay on the right side of western creditors and was 
confident that Russia now had the funds to meet the payments.

"By increasing debt service payments on defaulted Soviet debt, the Putin 
government is clearly throwing in its lot with the West, counting on renewed 
funding from the IMF and the market," said analyst Eric Kraus of Nikoil 
Capital Markets.

The Putin-Kasyanov team "is heading in a clearly liberal direction in terms 
of finance, while becoming increasingly authoritarian on the domestic front," 
he said.

Russia has striven for some sort of accommodation with its long-suffering 
foreign creditors ever since its financial system collapsed in August 1998, 
leaving the government all but bankrupt and facing a foreign debt mountain in 
excess of 150 billion dollars.

Kasyanov said that Friday's deal would lead on naturally to talks with the 
Paris Club in the second half of the year, where "naturally Russia will work 
for terms of rescheduling comparable to the terms coordinated with the London 
Club."

But some analysts say those talks would be tricky because Russia's leading 
bilateral donor, Germany, is reluctant to grant relief given the country's 
status as a vast quarry of mineral wealth.

*******

#13
Baltimore Sun
13 February 2000
[for personal use only]
Why the empire won't strike back
By Jeffrey Brooks
Jeffrey Brooks is a professor of history at the Johns Hopkins University and 
the author of "Thank You, Comrade Stalin! Soviet Public Culture from 
Revolution to Cold War" (Princeton University Press).

RUSSIAN PRESIDENT Vladimir V. Putin announces his intention to strengthen the 
role of the state and reminds the world and his country that Russia remains a 
great nuclear power.

Strobe Talbott, the Clinton administration's previously upbeat Russian policy 
maker, now sounds a distinctly less optimistic note in concern about a 
resurgent Russian past. Is empire again on Russia's agenda? We do not know 
the motives of Russia's present leaders, but if they do yearn for restoration 
of an empire, they will have great difficulty bringing the voters along. 

The Russian government cannot present the territory of the former republics 
of the Soviet Union -- the so-called "near abroad" -- as rich, exotic or 
exciting as did czarist promoters of newly conquered regions. Today's 
Muscovites and northern Russians are more likely to see the Caucasus as a 
death trap than as a frontier in which to test one's manhood, as young Leo 
Tolstoy described it in "The Cossacks." Russians are not flocking to the 
"near abroad" in search of a better life, but fleeing its horrors and 
poverty. The rationale behind Soviet imperialism is equally irrelevant today.

The early Bolsheviks justified expansionism by arguing they were freeing 
peoples enslaved by capitalists and colonialists. The idea of a gift to 
oppressed people fit the logic of the Soviet political life, according to 
which all citizens were indebted to the leader and ruling group. Under Lenin, 
the people thanked "the Revolution" or "Soviet power" for their good fortune, 
but Stalin insisted on being thanked personally, as in the slogan "Thank You, 
Comrade Stalin, for a Happy Childhood!"

Translated into the politics of the empire, non-Russians thanked the central 
authority and its agents, including the Russians, for incorporation into the 
bounty of the greater union. After World War II, the calculus of indebtedness 
extended to Eastern Europe, even though Stalin managed economic relations 
within the bloc in favor of the Soviet Union.

Later, Nikita Khrushchev and Leonid Brezhnev oversaw an outflow of Soviet 
resources to client states that became a torrent, particularly as the Cold 
War extended to the Third World and as oil prices rose in the 1970s.

The notion that the leaders were giving away the store to ill-deserving 
foreigners took hold gradually, but so long as the Communist dictatorship 
persisted, the impe||*Page=003 Loose,0001.05*||rial project's unpopularity 
had little impact on national politics. When Communism fell, however, public 
opinion mattered and, as a result, the empire and the network of client 
states vanished with little clamor from the Russian majority.

The current Russian government may play politics in the Caucasus in the 
fashion of its czarist and Soviet predecessors, but public support is lacking 
for anything more than a defensive action. The Putin government cannot 
justify the brutal war in Chechnya as empire building, and we should not 
perceive it as empire building. The fall of Grozny on Feb. 6 changes nothing. 
The war is an inept muddle and an attempt to hold the country together, this 
time with baling wire, rather than the barbed wire of the past.

So long as Russia remains a democracy, there is little likelihood that 
imperialism will revive. In the weeks before the March 26 presidential 
election, Mr. Putin may win support as an anti-terrorist, but not as an 
imperialist. Nor is friction with the United States likely to attract a 
public eager for the prosperity that many believed would follow the fall of 
Communism. Although anti-American sentiment has increased in Russia, it is 
not likely to take an imperial form unless we go far out of our way to 
provoke it.

Given the domestic preoccupations of the Russian electorate and the bad 
memories of recent imperial adventures, the empire is unlikely to strike back.

*******

#14
INTERVIEW-Russian general slams US on missile plan
By Martin Nesirky

MOSCOW, Feb 14 (Reuters) - A Russian general said on Monday only the naive or 
stupid would believe a U.S. Star Wars-style shield was intended to intercept 
so-called rogue states' missiles rather than those from Russia or China. 

The United States wants to amend the 1972 Anti-Ballistic Missile Treaty to 
allow it to deploy a defence system against possible attack from North 
Korean, Iranian or Iraqi missiles. 

Russia -- which has the world's second-largest nuclear arsenal -- says such a 
system would undermine the treaty's aim of making the two main nuclear powers 
feel equally vulnerable and eager to disarm. 

``When anti-ballistic missile experts gather, I feel sorry for the 
Americans,'' Colonel-General Leonid Ivashov told Reuters. ``They cannot put 
forward any serious arguments.'' 

But he said Russia was prepared to help find other ways to allay U.S. fears 
if Washington put its project on ice. 

He said it was unlikely North Korea could develop intercontinental ballistic 
missiles capable of reaching the United States soon. Iraq and Iran were 
simply too far away. 

``For this reason, to say such an expensive system is being developed to 
intercept Iranian or Iraqi missiles heading north and to intercept possibly 
one or two North Korean missiles -- it's an argument for the naive or 
stupid,'' he said. 

``But it does not convince serious people,'' he added. ``This system will be 
directed against Russia and against China.'' 

Ivashov said when Russian experts asked U.S. officials whether the planned 
shield could intercept Russian missiles, they avoided answering directly. 

``They say it will not. What's this, good intention?'' said the general, who 
heads the Defence Ministry's international relations department. ``It can but 
it won't. I'm sure it won't anyway because they won't be launched, but it is 
able to.'' 

GENERAL DISMISSES U.S. ARGUMENTS 

Ivashov, echoing remarks made last week, said U.S. arguments about North 
Korean missiles were laughable. 

``You need to have an aim, a reason for launching these missiles against a 
country,'' he said. ``You'd have to be a completely mad country to aim or 
launch one missile and face being completely destroyed in retaliation.'' 

He said Moscow would find ways to respond if the anti-missile shield was 
deployed. 

``We still hope the Americans will see sense,'' he said. 

``We understand the position of the U.S. administration. It is like a person 
running in front of a train,'' Ivashov said, noting it was difficult to back 
away from such a scheme during an election year. 

U.S. President Bill Clinton is expected to make a decision in July whether to 
begin deploying a $12 billion system of interceptor missiles or wait for 
further testing. 

``It is not easy to get out of this situation, but there is a way out, I 
believe,'' he said. ``That is to put the idea on ice, not to waste money on 
development and to find other ways. It is possible through political means to 
remove even the doubts there are about the intentions of North Korea, Iran 
and Iraq.'' 

He said guarantees could be secured from such states not to develop 
long-range ballistic missiles. 

``Russia is prepared to help in this process,'' he said. 

******