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Johnson's Russia List


February 22, 2000    
This Date's Issues: 4124 4125


Johnson's Russia List
22 February 2000

[Note from David Johnson:
1. AP: Russia Security Agency Monitors Web.
2. The Moscow Tribune: John Helmer, THREE WISHES FOR PUTIN. But can the president smelt aluminium?
3. Moscow Times EDITORIAL: The Voters Also Cry ... For Help.
4. RFE/RL: Paul Goble, Toward Totalitarian Democracy?
5. Timothy Blauvelt: Re: Dissidents.
6. Novaya gazeta: Nikolai Petrov, The Alfa Banking Group Takes Over the Duma.
7. Moscow Tribune: Stanislav Menshikov, BAD IDEAS SHOULD NOT CROWD OUT GOOD ONES. Gresham's Law Is Threatening Putin's Programme.
8. Albert Weeks: Re: Mahoney on dissidence.
9. Peter Mahoney: Re: Gessen/Dissidents (4121).
10. Reuters: Putin tops list of Russian election hopefuls.
11. Reuters: Russian Communists call for Chubais to be sacked.
12. Reuters: Russian data boosts Putin president bid.] 


Russia Security Agency Monitors Web
February 21, 2000

MOSCOW (AP) - The successor to the KGB is now also spying on the Internet, 
raising fears that the information it collects could be used for blackmail 
and business espionage. 

``The whole Federal Security Service will be crying tomorrow over your love 
letters,'' warns one of the banners angry Russian Web designers have posted 
on the Internet. 

Russian human-rights and free-speech advocates say the security service has 
already forced many of the country's 350 Internet service providers to 
install surveillance equipment. 

``Most Internet providers in Moscow, including all the large providers and 
many in the provinces, have opened a hole'' for security agents to peep at 
traffic, said Anatoly Levenchuk, a Russian Internet expert. 

Like its counterparts in other countries, the Federal Security Service may 
argue it needs the monitoring system to catch spies, terrorists and bandits, 
and to combat black-market businesses and capital flight. 

But the system has raised particular alarm in Russia, where memories of KGB 
surveillance and repression remain fresh. And the abundance of secretly 
filmed, juicy videotapes and transcripts of telephone conversations in Russia 
seems to justify the fear of blackmail by renegade security agents or others 
who get hold of the information. 

Free-speech activists fear that the Internet surveillance is evidence of the 
security services' resurgence under acting President Vladimir Putin, a 
15-year KGB veteran. They have already accused him of chipping away at press 
freedoms championed by former President Boris Yeltsin. 

Last week, a government official for the first time publicly acknowledged the 
existence of the Internet control project, called the System of Operative and 
Investigative Procedures or SORM-2, its Russian acronym. 

Alexei Rokotyan, the Communications Ministry's electronic communications 
department chief, denied that the project was aimed at ``total control of the 
information that is transmitted via the global network.'' 

``Security organs and special forces have the right - and now the capability 
- to monitor private correspondence and telephone conversations of individual 
citizens according to the law,'' The Moscow Times daily quoted him as saying. 

Levenchuk and others said the Federal Security Service has been quietly 
implementing the system at least since 1998. 

``As you look at all these Orwellian things you understand it's coming - 
total control, total surveillance,'' Levenchuk told a round table held in St. 

Federal Security Service officials apparently view the steps simply as an 
extension of SORM regulations enacted in the mid-1990s, which allow security 
agents with a warrant to tap telephones and Internet traffic. 

At a series of meetings with Internet providers in 1998, security service 
officials described a system that would involve a box installed in providers' 
computers that would route electronic traffic to the local security service 
headquarters through a high-speed link. 

The project still seems a far cry from Echelon, a high-tech spying network 
which, according to a European Parliament report, is coordinated by the U.S. 
National Security Agency and involves ``routine and indiscriminate'' 
monitoring of electronic communications around the world. 

But Russia's Internet freedom activists are still raising the alarm. 
Levenchuk's site is filled with accounts from mostly 
provincial providers that say they were forced to install SORM-2 equipment. 

One provider in southern Volgograd, Bayard-Slavia Communications, actually 
refused when security service agents sought to ``receive full and 
uncontrolled access to all our clients and their communications,'' its chief 
Nail Murzakhanov said. 

Bayard-Slavia had its main communication line cut off and faced threats of 
fines from government officials. But it won a court case against the security 
service last fall. 

Human rights advocates said Murzakhanov's confrontation with the Federal 
Security Service was enough to persuade many a reluctant provider. 

But Anton Nosik, who edits the Vesti.Ru and Lenta.Ru electronic newspapers, 
said the case was rare and that he was not aware of any major providers 
complying with the SORM-2 directives. 

Nosik was less concerned than others, saying security service agents already 
have access to electronic traffic and would not be able to monitor its 
ever-increasing volumes in full. 

``Yet there is an unpleasant trend of security services trying to implement 
non-constitutional norms,'' he said. ``This should not be allowed.'' 


Date: Mon, 21 Feb 2000
From: (John Helmer)

The Moscow Tribune, February 22, 2000
But can the president smelt aluminium?
By John Helmer

Jesus Christ makes an appearance on a Tupolev-154 during a domestic run
between Moscow and Irkutsk, so the Soviet-era anecdote went.

He goes up to the first passenger, and asks what is his wish. "I wish all
communists would disappear from the face of the earth," says the man.

"Very well," says Jesus, and moves on to the next passenger. Asked what he 
wishes, the fellow replies: "I wish all fascists would be got rid of."
"Very well," Jesus responds, and moves on to the next passenger, who happens 
to be Jewish. "What is your wish?" Jesus asks again. "May I ask you a 
question, Mr. Jesus?" comes the reply. "By all means."

"Are you really going to do everything these gentlemen ask?"
"Of course," replies Jesus. "I am the son of God."
"In that case," says the Jew, "I would like just a cup of coffee."

When Vladimir Putin took the state airplane to Irkutsk last week, he realized 
he is obliged to play God, and deliver more than a cup of coffee, if the 
turmoil in Russia's aluminium industry is to be resolved.

Irkutsk is home to the Bratsk Aluminium Works (BrAZ), the world's largest
aluminium smelter, and one of the most important taxpayers to the regional
budget. Governor Boris Govorin made very sure that the acting president 
understood that the week-old fight between Boris Abramovich, Lev Chernoy, 
Boris Berezovsky, and other shareholders over who will control the plant is a 
matter of the highest state importance. Anatoly Chubais, who has a big 
interest in the power produced in the region, as well as in the huge 
electricity bill owed by Krasnoyarsk Aluminium Works (KrAZ), across the 
Irkutsk border, told Putin the same thing in Irkutsk.

Until that moment, Putin had been announcing what, in theory, he thinks the
state should do in economic management, hinting at what he may do, if and 
when he is elected president. "The state should create clear, understandable, 
and fair rules, " he said on the radio on January 23. "Most importantly, it 
should create a system for observing and upholding these rules."

On February 8, Putin said on television that when it comes to Russia's
industrial and financial oligarchs, he thinks they are no more than
"subjects in the market." The state's role, he said, is to "guarantee
compliance with these [market] rules, without offering any advantages or
privileges or preferences to anyone, regardless of political leanings or the
scale of their activities."

The president, Putin went to emphasize, "should stand above this influence,
and not pile up all the interests only in favour of the big companies and 
monopolies. We should not allow this."

The aluminium battle is Putin's first big chance to show what he says he
is made of. 

If the claims of Lev Chernoy and Boris Berezovsky are to be 
believed, control of at least two-thirds of all Russia's primary
aluminium metal is about to be traded into the hands of Berezovsky
and Boris Abramovich, leading shareholder of the Sibneft oil company.
They have been offered shareholdings in BrAZ, Krasnoyarsk Aluminium
Works (KrAZ), and Novokuznetsk Aluminium Works (NkAZ). Altogether,
these plants produce almost 2 million tons of aluminium a year --
almost 10% of production worldwide.

While the volume doesn't amount to a monopoly of Russian metal, 
it would dwarf the Sibirsky Aluminy Group, which is heading for output
this year of about 400,000 tons; and the Siberian Ural Aluminium
Company, which trails with about 340,000 tons.

At the same time as Putin confronts this shift in aluminium, Chernoy
is asking Abramovich and Berezovsky to use their political influence,
and recover the Achinsk and Nikolaev alumina refineries, which are
now being run By Sibirsky Aluminy and its partners. Without alumina,
you can't make aluminium. and without cheap alumina, your aluminium
won't be so profitable. Whoever runs KrAZ and BrAZ understands that.

This message will be carried to the Ukraine this week by First Deputy
Prime Minister Mikhail Kasyanov. He will tell the Urainian government that 
the terms of a deal to settle overdue debts to Russia should include
a revision of the terms of privatization of Nikolaev, so that it won't fall
permanently into the hands of Sibirsky Aluminy. Kasyanov appears
to be siding with the Chernoy-Abramovich group.

Against him, Anatoly Chubais has weighed in, telling Putin last week that
he does not favour the concentration of BrAZ and KrAZ in Abramovich's
hands. Cheap electricity is the other ingredient in making aluminium,
and this has given Chubais substantial influence over who controls
KrAz, as well as Novokuznetsk, because both are heavily indebted to the
regional power suppliers. Chubais is backing the Sibirsky Aluminy's
effort to acquire its own power source for the Sayansk smelter by merging
with the Khakassia utility.

In Yeltsin's time, it was rare for quite so many oligarchs to line up
against each other for a piece of property. Yeltsin's solution was often
Solomonic, tearing one piece for one, and another for his rival. But that
was the time when the property at stake belonged to the state.

Now it's different. In Irkutsk, Putin tried to sound neutral and
non-committal. If he is to take sides, he will either order the Ministry
of Anti-Monopoly Policy to investigate the proposed sale, in which case
he is siding against Abramovich. Or he will say nothing, allowing the 
deal to proceed. The Solomonic variant is no longer available. Nothing
less than Jesus Christ will do now.


Moscow Times
February 22, 2000 
EDITORIAL: The Voters Also Cry ... For Help 

Gather 50 Russians in a room and take an impromptu poll. Which issue would 
they most like to see addressed in this year's presidential race? 

1) The economy 

2) Crime and corruption 

3) The war in Chechnya 

4) The preservation of "Santa Barbara" 

In a humdrum election season when the eventual outcome is taking on a 
foregone-conclusion feel, it's somewhat dispiriting to think that this year's 
candidates may skip with impunity the usual obligations of paying lip service 
to the concerns of the electorate. 

In recent weeks the government has hit the average voter where it hurts, 
announcing plans to jack up prices on both vodka and bread. Surprising moves 
in a campaign season, but aside from somewhat sinister allusions to the 
return of a strong state power, presidential candidates haven't bothered to 
toss many bones to the voters, who themselves haven't bothered to ask for 
many, assuming - perhaps rightly - that the die has already been cast. 

Which is why it's nice to see the return of "Santa Barbara," the 
entertainment lifeblood of many a Russian television viewer. As today's 
back-page article relates, the serviceable U.S. soap opera has weathered the 
storms of post-Soviet Russia right along with its audience, debuting in the 
heady year of 1991 and dying a cruel and protracted death in the months 
following the 1998 financial crisis. The cancellation, one fan noted 
dismally, was of a decidedly Russian character - "just another reminder that 
we should never get too attached to anything we enjoy." 

Middle-aged women - the heart and soul of the barbaristy movement - dusted 
off their placards and hit the streets, demanding justice. Justifiably 
nervous, RTR state television brought the issue before the government as a 
matter of "national security" and says it fought furiously to renegotiate the 
soap's price. 

Only now has the groundswell of protest been soothed, with the return of a 
daily 11 a.m. time slot. Politicians have yet to grab on to the golden 
coattails of this populist feat, but there is a glorious, if humbling, 
victory to be had in that Russians - at least in one small way - have asked 
for and received what they want. The state has upheld the right of every man, 
woman and child to watch the remaining 520 episodes of what is possibly the 
most beloved soap opera ever to air in this country. (Perhaps a rally for the 
return of "The Rich Also Cry" will be next.) One can only hope that this 
isn't the season's only democratic highlight. 

- Daisy Sindelar 


Russia: Analysis From Washington -- Toward Totalitarian Democracy?
By Paul Goble

Washington, 21 February 2000 (RFE/RL) -- Acting Russian President Vladimir 
Putin's suggestion last week that only his office can "guarantee" the rights 
and freedoms of all Russian citizens betrays a serious lack of understanding 
on his part both of what freedom is and of how it can be defended in a 
democratic society.

More ominously, Putin's remarks suggest that the Russian leader hopes to use 
populist rhetoric to re-establish in Moscow a powerful state unconstrained by 
the Russian Constitution or by Russian laws and one ultimately beyond the 
control of the Russian people in whose name he claims to be acting.

Such an approach, whatever superficial and immediate attractions it may have 
for Russians tired of the current chaos in their country or for Western 
leaders interested in promoting free market reforms there, has very little in 
common with the principles and arrangements of liberal democracy.

Instead, it recalls the ways in which authoritarian leaders in Europe and 
elsewhere have used the language of democracy in order to subvert democratic 
arrangements and democratic ideals, efforts Israeli political scientist J.L. 
Talmon described so cogently in his classic study "Totalitarian Democracy." 

That work has reminded a generation of Western readers that leaders in a 
variety of countries have cloaked their authoritarian or even totalitarian 
pretensions in democratic language. And it thus has warned against taking 
their professions of loyalty to democratic ideals at face value.

Putin's remarks in Irkutsk last Friday clearly invite such scrutiny. Speaking 
to university students there, the acting Russian president said that "you 
have to create a society and forms of leadership which will not strangle the 
most important thing, which is democracy, because without democratic 
processes, the real development of a government and society is impossible."

"But," Putin quickly added, "there should be a clear institution which would 
guarantee the rights and freedoms of citizens independently of their social 
situation, economic situation, and so on and so forth." And he concluded that 
"this institution can only be the institution of the presidency."

Putin's remarks are troubling on three grounds. 

First, they suggest that he understands far better than his predecessor the 
combined appeal both inside Russia and abroad of a political platform that 
combines populist rhetoric and calls for a new strong hand at the helm in 

Many Russians want a respite from the dislocations of the past decade, but 
most also remain committed to democracy, however imperfectly understood. And 
Putin promises them both, a revived state with a powerful leader and 
democratic principles guaranteed by himself.

And many Western leaders too welcome Putin's commitment to a stronger state, 
viewing it as the only way for Moscow to take the steps the West has urged it 
to. Indeed, one leading American newspaper yesterday without apparent irony 
entitled its analysis of where Russia is headed "Putin Steering to Reform, 
But With Soviet Discipline."

Second, Putin's words in Siberia imply that he has little or no genuine 
understanding of what democracy is about and is counting on others, again in 
both Russia and the West, to accept at face value his professions of 
commitment to that form of governance. 

In liberal democracies, the rights and freedoms of individuals are protected 
not by one man however powerful but by an elaborate system of checks and 
balances between parliaments and governments, by the existence of an 
independent judiciary, and by constitutional and legal arrangements which 
enjoy widespread respect.

Such arrangements generally take generations to evolve; in no country have 
they ever been introduced by executive order. But like other Russian leaders 
before him, Putin is clearly appealing to those of his countrymen who would 
like to short circuit this process as well as to many in the West who are 
reluctant to commit to such a long-term and open ended struggle.

And third, the words of the acting Russian president and former KGB officer 
suggest that he views democracy less as a system of government capable of 
defending individual rights and ensuring that its citizens have a genuine and 
continuing voice in its operations than as a means of building state power. 

Putin is hardly the only world leader to have adopted this approach: he is 
simply the latest. But those who find his words encouraging may soon discover 
what more than one political philosopher has observed: any state powerful 
enough to give people everything they say they want will likely be powerful 
enough to take away everything they have. 


Date: Mon, 21 Feb 2000
From: Timothy K Blauvelt <>
Subject: Re: Dissidents 

John Jaworsky makes an important point in noting that the debate on
dissidents has thus far centered only on Russia. Arguably, the national
independence movements, particularly those of the Baltic and
Transcaucasian republics, during the final phase of the perestroika period
played no small role in the collapse of the USSR. And in many cases, such
movements were spearheaded by dissidents. The Republic of Georgia is a
case in point: in Georgia the Party became marginalized early on,
following its discreditation as a result of the massacre in April 1989,
and its inability to deal with the pace of change. The
nationalism/independence movement became increasingly radicalized, and was
lead by the dissident intelligentsia - people like Merab Kostava and Zviad
Gamsakhurdia, people who had been contributors to the Chronical of Current
Events and founders of human rights groups like Helsinki Watch Georgia.
Instead of forming alliances with elements of the nomenklatura as in the
Baltics (or being marginalized entirely, as in Russia), in Georgia the
intelligentsia - and the dissident wing, in particular - actually took

Here also we have an actual case-study example of how effective
members of the Soviet era dissidence movement can be in governing. While
this was a confusing and chaotic period, and there were many competing
factors (not least of which was interference from Moscow), the
spectacularly disastrous Gamsakhurdia administration probably owned much
of its downfall to the political culture endemic to the dissident milieu
of Gam and his associates: inability to form coalitions or make tactical
alliances (mush less moral compromises), constant fracturing and
splitting, paranoia about enemies within, and a general us-vs-them
approach to politics. Not to mention ethno-nationalism, which in the case
of Gamsakhurdia has probably been overexaggerated, and in any case was
more of a plea for popular support. (An element of ethno-nationalism, in
any case, is probably not entirely absent from any element of the Soviet
era dissidence movement). Gamsakhurdia went from being the "Vacslav Havel
of the Caucasus" to the "Hitler of the Caucasus" virtually overnight, from
being elected with 85% of the popular vote to being chased out of the
country at gunpoint in less than 18 months. Again, while all of this may
be the result of flaws in Gamsakhurdia's character and external political
factors, I think a good argument can be made that the dissident political
culture, centered on opposition and confrontation with the system, played
no small role. Had Merab Kostava taken Gamsakhurdia's place (he was killed
in a car accident in 1989), for example, I have a feeling that events
would taken a similar path.

Timothy K. Blauvelt
515 Park Hall
Dept. of Political Science
SUNY at Buffalo
Amherst, NY 14260
716-645-2251 ext. 515


Novaya gazeta
February 21-27, 2000
Nikolai Petrov, Analytical Group
The Alfa Banking Group Takes Over the Duma
[abridged translation for personal use only]

Let us begin with a political quiz test: what is the country in which a
single financial group, far from the largest in the nation, can have a tight
grip on a half of the presidential staff, a large portion of local
administration chiefs and more than a third of the nation's parliament?

Your response? Columbia, Nigeria? Wrong. It's Russia. And it is the Alfa

<...> The Alfa people entered the presidential staff in mid-1999. At that
time, no one paid much attention. Big deal - they replaced Sergei Zverev,
the chief PR man from the Most Group and Gazprom, with Vladislav Surkov, a
public relations craftsman at Menatep, and later at Alfa. The personnel
turnover in the Kremlin PR team had long ago become a routine. <...>
However, Surkov's appointment as deputy chief of the presidential
administration in charge of domestic policies, relations with parties and
the Federal Assembly became the first step in Alfa's penetration into all
the above-mentioned institutions. Soon after, another loyal Alfian, Vadim
Boiko (a deputy of the 1993-95 Duma) was appointed adviser to the Chief of
Administration Aleksandr Voloshin. <...> In late 1999, they were joined by
another Alfa man, Aleksandr Abramov, who obtained the regions' section of
the administration, which means control over regional governors. Recently,
one more Alfa appointee, and also a former Duma deputy Andrei Popov became
directorate chief in the administration, replacing Andrei Loginov, a YUKOS

The establishment of the "People's Deputy" group in the previous Duma became
the first undertaking of the Alfa squad in the Kremlin. The group that was
registered just a few days before the expiration of the Duma term was
designed as a vehicle to counteract such undesirable forces as Russia's
Regions (allied with the Fatherland-All Russia) and partly Chernomyrdin's
Our Home Is Russia.

<...> Some knowledgeable people told us, that Vadim Boiko was inviting the
deputies targeted for membership in the new group into his office, handing
them $ 20,000 in cash in exchange for their signature and promised
assistance in their prospective electoral campaign. The Alfa men held their
promise - campaign funding was provided without delay. Using these means,
they assembled a group of 45 deputies, led by Yelena Panina, while
demonstrating to the Kremlin and to their bosses the efficiency of their
modus operandi.

Thus, on the eve of the election, two forces were operating in the Kremlin
on parallel tracks - the Shabdurasulov group, financed by Berezovsky,
Abramovich and Aksyonenko, was busy setting up the Unity party, while the
Alfa group was overseeing People's Deputy candidates in the single-member
districts. After the election, the Unity people were triumphant, while the
other team lost badly: out of 60 candidates financed by Alfa, only two
(Raikov and Vorotnikov) made it to the Duma benches. According to
knowledgeable people, in late December the Alfa trio was in a hysterical
mood. <...> Yet already in January, it resorted to its well-known means to
set up a group out of those single-member deputies that were elected to the
Duma. The new group numbered 60 deputies and was given a not-so-trivial
name - "People's Deputy". The Alfa Kremlin group managed to cut a deal with
the communists, obtaining five committee chairmanships for their proteges,
in exchange for supporting Seleznyov's bid for speakership. For the sake of
comparison, a full-scale party faction, Fatherland-All Russia, that came as
such through the election crucible, obtained just one committee
chairmanship. In this game, several million votes were easily outweighed by
the Alfa money.

Moreover, the Alfa faction in the Kremlin managed to take away from the
Berezovsky group the chairmanship of the newly-created Committee on Credit
Institutions and Financial Markets. The Committee was handed over to the
People's Deputy group, personally for Aleksandr Shokhin, an old friend and
colleague of Petr Aven, the Alfa chief, with whom he had served in the
Gaidar government.

In addition to the credit-and-finance committee, there are two other
economy-related committees in the Duma. Currently, both of their chairmen -
Sergei Glazyev of the Economic Policy Committee and Aleksandr Zhukov of the
Budget Committee - are being harshly pressured to make sure they respect
Alfa's interests. So far, Alfa did not come to terms with Zhukov, who
managed to install his OVR and Yabloko colleagues to key subcommittee
chairmanships. But the failure of Mikhail Zadornov to be confirmed as
Zhukov's deputy was a clear revenge to both of them.

One of the goals of Alfa attempts to seize control over key financial
committees is to be able to blackmail the Central Bank head Viktor
Gerashchenko, by threatening him with an unacceptable draft law on the
Central Bank, demanding parliamentary oversight over the Bank and an
immediate investigation of the FIMACO case and related Central Bank
activities. All this is essential for Alfa Group not just from the long-term
point of view (what is a commercial bank that does not dream of having a
subservient Central Bank chief), but also in practical terms - soon, it is
time for Alfa to repay the ARCO loan...

Yet another committee under Alfa control is the Information Policy
Committee. It is now headed by Konstantin Vetrov, formerly Alfa's Vice
President, elected to the present Duma on the Zhirinovsky list. No one else
but him became chairman of this single committee assigned to the LDPR

Even such a heavyweight as Viktor Chernomyrdin became one of the casualties
in this struggle. Despite the defeat of Our Home Is Russia on the
proportional vote, the party managed to win nine seats in the single-mandate
districts. On this basis, Chernomyrdin planned to set up an NDR caucus,
reinforcing it with some independent deputies elected to the Duma thanks to
Gazprom money or otherwise financed by fuel and energy companies. But in
early January the Gazprom executives suddenly ordered its single-mandate
deputies to register as members of Alfa's "People's Deputy" group. As a
result, Chernomyrdin lost his prospects to head a fuel and energy committee
in the Duma that had been firmly promised to him in late December, and he
had to join the committee as a rank-and-file member.

<...> According to unofficial calculations, the Alfa group wields influence
over about 80 members of the Unity faction, 60 members of the People's
Deputy group, up to 15 members of the agrarian caucus, 7 members of Russia's
Regions and 10-15 communist deputies whose campaign was also financed by
Alfa. <...> On top of this, Alfa keeps in its coffers dozens, if not
hundreds of notes with personal signatures confirming the receipt of large
sums of cash by Duma members and other high-ranking officials.

And documents of this kind are not to be destroyed.


From: "stanislav menshikov" <>
Date: Mon, 21 Feb 2000 

"Moscow Tribune", February 22
Gresham's Law Is Threatening Putin's Programme
By Stanislav Menshikov

Sir Thomas Gresham, an adviser to Queen Elisabeth I of England, way back in
the 16th century, stated one of the few eternal and uncontested economic
laws, namely that "bad money drives out good". The simple logic of this law
is that it is always profitable to spend bad money and save good money. Not
universal, yet widespread is the application of Gresham's Law to realm of
ideas. At least in Russia, bad ideas too often dominate while good ones are
shrugged off as "stupid", irrelevant or unrealistic. The reason is that
people with bad ideas, once they achieve power, consider people with good
ideas too dangerous to freely express their views. Once in a while, a
person with good ideas somehow makes it to the top. But even he finds it
difficult to turn the tide in the right direction.

Consider the case of Messrs. Putin and Kasyanov. Putin's initial programme
explained in his big article published on the Internet on New Year's eve,
clearly stated an activist approach to economic policy. Underlying this
approach was the right idea about inadequate demand as a principal barrier
to economic growth. Following up on this approach, Putin raised government
expenditure on pensions, employee salaries and defence giving a much needed
boost to expanding output. This January, industrial production was 10.7 per
cent higher than in January 1999, a good starter for the whole year. This
is a revolutionary U-turn in economic policy compared to the "radical
reformers" who managed to reduce government expenditures in real terms so
much that they nearly destroyed the economy. Thanks to Primakov and then to
Putin, real federal expenditures rose by 11.5 per cent in 1999. This is
hopefuly bringing the economy back to life.

But not so fast! For a more formal definition of his presidential programme
the acting head of state is relying on a strategic think-tank where sane
ideas are confronted with disastrous. According to our information, the bad
ideas are promoted there by Evgeny Yasin, somewhat of a Godfather to the
"young and brilliant reformers" whose incompetence was exposed for all to
see in the policies of the early and mid-90s and led to the greatest
economic depression in history. Good ideas are contributed by Victor
Ivanter, whose Institute of Economic Forecasting has built itself a solid
reputation in the profession of economic analysis based on realities but
was totally ignored by the "brilliant". And finally, a "no ideas" group is
presented by the High Economic School which sympathises with the bad ideas
but is reluctant to take a definite stance due to current political
uncertainties. The resulting dishes from this kitchen threaten to be
indigestible unless Putin and German Gref, the think-tank's boss, hopefully
manage to sort out the bad ideas before they get on the presidential menu.

Another programme is being prepared for the future government by Mr.
Kasyanov's office. While it could probably carry more practical weight
after March 26, we know precious little about its elements and, more
importantly, about whom Mr. Putin, if he wins, will appoint to the cabinet.
Let us take up some of the elements we do know of. Mr. Kasyanov puts an
accent on improving the investment climate coupled with tighter controls in
order to stem capital flight. Banking reform is also a priority on his
list. And a system of state-guaranteed prices is suggested as a key measure
to stimulate agriculture.

This last element is particularly important because it brings realism to
the discussion on land reform. In the last decade, prices for farmers'
products have fallen way below parity with industrial prices which inflate
sky-rocketing farmers' costs. No wonder that agriculture is one of the most
depressed sectors of the economy. Free pricing of land will further
increase those costs adding to the depression. Agriculture will not recover
unless farmers' prices are set right. That was successfully done in the US
where maintaining parity between agricultural and industrial prices has
been one of the mainstays of economic policy since the 1940's. Leaders of
the Union of Right Forces argue that restoring parity is irrelevant. Their
ideological blindness is simply fantastic. If the free market did not work
for agriculture in normal market economies (a fact that is admitted by most
modern economists), why should it work in the lopsided Russian market?

Mr. Kasyanov has also been active in starting to restore the domestic
securities market killed by the 1998 default. New GKO's are being
introduced, and prospects for their acceptance look promising. Given
cautious governance, current primary budget surpluses and relatively low
overall budget deficits, this should not recreate the disastrous fiscal
pyramid of the recent past. This is another sane idea that should not get
crowded out by recurrent panicky cries about Messrs. Putin and Kasyanov
leading the country towards a new inevitable default. 

Perhaps the time has come to minimise, if not totally exclude the workings
of Gresham's law in the realm of ideas. There is no reason why good ideas
should not drive out bad ones, for a change.


Date: Mon, 21 Feb 2000
From: Albert Weeks <>
Subject: Re: Mahoney on dissidence

Peter Mahoney offers some thought-provoking insights 
concerning the inefficacy of Soviet dissidence. Having written 
a Simon & Schuster Monograph Note on that subject and interviewed
leading personalities (e.g., Turkin, Litvinov, Navrozov, et al.) in the
movement, I'd raise a caveat in Mr. Mahoney's line of argument, 
or rather, that of his anonymous correspondent. It is not true 
to say that the dissidents promoted no specific political reforms, 
that they merely pursued a will-o'-the-wisp "truth" (Mahoney's 
quotation marks). Fact is that they made any number of 
concrete proposals for reform, as did Sakharov himself.
Among them: constitutionally-guaranteed rights of free speech, press,
and assembly, and habeas corpus. Rather real reforms, after all! 
Perhaps Mr. Mahoney may not have read or heard of the dissidents' 
concrete program for reform that can be found in Samizdat literature. 
Now, whether this literature had anything to do with Gorbachev's 
reformist tinkerings with the System is, as Mahoney suggests, possibly 
open to debate. But that popular restiveness, not to mention intellectuals'
disenchantment, only slightly "bothered" the leadership might well 
be disputed by no less a Politburo figure than, say, Aleksandr Yakovlev 
not to mention Mikhail Sergeyevich himself. 
Mr. Mahoney might read through some of the representatives' speeches 
made in the late '80s in the Congress of People's Deputies to get a feel 
for the truly tangible urge for major reforms pouring in from the
of Soviet society-- i.e., from sources other than those lonely, atomistic 
"kitchens" mentioned by Mr. Mahoney.


Date: Mon, 21 Feb 2000 
From: (Peter Mahoney)
Subject: Re: Gessen/Dissidents (4121) 

Over the years I have been occasionally contributing a few small comments to
JRL, almost all of which provoked no on-list response, although I have
received numerous private communications on things I have written. I was
always a little non-plussed about that, partly because I'm the argumentative
type and I thoroughly enjoy a lively exchange of opinions, partly because
when I write something I invariably later think of other things I wanted to
say and hope that a response will give me the chance to say them. The
response to my thoughts on dissidents has been both a blessing and a curse.
The blessing, of course, is that I have provoked people with my pieces, and
I am having a great time defending my position. The curse is the time it
takes to compose my arguments. My students are wondering why my last few
lectures have been ill-prepared, why I haven't finished grading their term
papers. My wife is yelling at me because I'm not washing the dishes, or
doing my share of child care. Such is the competition for my pursuit of
intellectual debate.

I was extremely pleased to see a response from Keith Gessen. His
recognition of VVAW as a force in the anti-war movement was gratifying,
although the way he phrased it made me feel old -- I am old, but, dammit, I
don't want to FEEL that way. And no apologies are necessary from Keith
based on his youth. It is the responsibility of youth to challenge the
assumptions of the old guys, to kick them in the butt when necessary. I
understood that the central premise of his article was to kick a little
butt, to relate the story of a few people who risked everything for their
moral principles, and to imply that such action was both necessary and sadly
lacking in today's world. It is a premise which I both applaud and support.

But I think Gessen both misread and over-reacted to the quote I used at the
end of my last posting. Part of this was my fault, since I made the classic
mistake of taking a quote out of context. The context of the rest of that
private communication -- from a person who expressed as much admiration for
the dissidents as Gessen does, and whose personal history is no less
intertwined with the dissidents than Gessen's -- was clear to me, but
perhaps not so clear to someone who only had the quote.

I understood that quote as making precisely the point which Gessen makes --
that the dissidents were politically naive, that they both didn't realize
that their actions were inherently political, nor were they ultimately able
to translate their moral actions into a coherent political agenda when the
opportunity presented itself. And with all due respect to Gessen and
Yarim-Ageev whom he quotes in his original article, there is more than a
little relativism and equivocation, not to mention moral ambiguity, in a
human rights dissident from the Soviet Union stating that the US was right
to be fighting the Vietnam War, at least in my moral universe. The classic
mistake of many dissidents, in my opinion -- both Soviet dissidents and
anti-war dissidents -- is defining yourself by what you are against, rather
than what you are for. When the thing you are against disappears, then you
lose your identity and head for the dustbin.

Gessen takes issue with my continual raising of the question of whether the
dissidents made a difference; he says that's not the question. For me, that
is precisely the question. Certainly, the motivation of dissidents is to
make a difference, although I know from personal experience that many
dissidents undertake their actions because the can't NOT do otherwise. But
if Gessen's goal is to hold up the dissidents as a paradigm of moral
behavior for the present and future, then it is crucial to answer this
question, because if, as I contend, they really didn't make much difference,
then we ought to know why, to keep future dissidence from becoming merely an
exercise in self-immolation.

Final note on Gessen. Keith, the anti-war protesters did NOT keep Nixon
from using a nuclear bomb in Vietnam. That was a bit polemical. The Bomb,
thank God, was never an option (despite General Wheeler's off-the-cuff
statement on the matter to the contrary). But as far as anti-war protesters
inhibiting Nixon's actions, one need only to look at the Christmas bombing
of '72. The Paris peace talks had been going on for years, and were finally
close to reaching an agreement. The North Vietnamese, however, refused to
budge on several points. In an act of pure vindictiveness, Nixon unleashed
one of the most massive, brutal, senseless acts of violence of the war. The
agreement that was ultimately signed in early '73 contained no significant
changes from the agreement in place before the bombing. Does this sound
like a president whose actions were in any way checked by the anti-war


PENPIX-Putin tops list of Russian election hopefuls

MOSCOW, Feb 21 (Reuters) - Russia's Central Election Commission finalised the 
list of contenders on Monday for a March 26 presidential election, which 
Acting President Vladimir Putin is widely expected to win. 

The 11 candidates approved for the election include Putin, a hotel owner of 
ethnic Chechen background and the first woman to seek the presidency. Four 
candidates were rejected by the commission. 

One, ultranationalist Vladimir Zhirinovsky, has said he will appeal to the 
courts against the ban. 

Each candidate had to gather the signatures of half a million supporters and 
provide evidence of income, property and funding. Following is a list of 
Russia's presidential hopefuls: 

VLADIMIR PUTIN - Putin, 47, the former head of Russia's FSB domestic security 
service, became prime minister in 1999 as a virtual political unknown and 
took over as acting president after Boris Yeltsin's surprise resignation on 
New Year's Eve. 

Putin has a wide lead in opinion polls due to his forceful conduct of the war 
against rebels in Chechnya but his critics have said he has no clear 
policies. He has also kept his past as an agent of the KGB Soviet security 
police a close secret. 

Opinion polls put his support at between 45 and 50 percent. 

GENNADY ZYUGANOV - Communist Party leader Gennady Zyuganov, the Kremlin's 
main opponent over the last 10 years, is running for the presidency for the 
second time. He lost a 1996 presidential campaign to Boris Yeltsin. 

Opinion polls generally give him a rating well below 20 percent. His 
supporters are considered to be highly organised but he has so far failed to 
mobilise a majority in his favour. 

GRIGORY YAVLINSKY - The head of the liberal Yabloko party, who also ran in 
the last presidential election in 1996 and came fourth. He supports market 
reforms with a human face and has promised an end to the Chechen war if 

Yavlinsky is well known in the West but has never won more than 10 percent of 
the vote in several Russian elections. Opinion polls put his rating in single 

KONSTANTIN TITOV - Governor of the Samara region on the Volga river. Titov is 
one of the most powerful regional leaders and sits in the Federation Council 
upper house of parliament. 

Titov supports liberal reforms and has the image of a strong economic 
manager. His chances of winning are very slim. 

AMAN TULEYEV - Left-leaning governor of the coal-rich Kemerovo region, 
Tuleyev backs Russia's Communists and has experience of running for the 
presidency, although he has never got close to winning. 

YURI SKURATOV - A former chief prosecutor suspended a year ago over a sex and 
corruption scandal. The Kremlin has tried three times to have him permanently 
sacked but the Federation Council upper house voted each time not to use its 
power to dismiss him. Skuratov said the sex scandal was engineered by the 
Kremlin in a bid to disgrace him and stop an investigation into high-level 

UMAR DZHABRAILOV - An ethnic Chechen, Dzhabrailov is a businessman with links 
to Moscow's upmarket Slavyanskaya hotel. 

ELLA PAMFILOVA - Ella Pamfilova is the first woman to run for the presidency 
and is the only female in the campaign. 

She was a member of the previous Duma but did not manage to get elected in a 
1999 parliamentary election. Panfilova, head of an organisation called For 
Civil Dignity, says her challenge for the presidency is aimed at setting a 
precedent for other women. 

STANISLAV GOVORUKHIN - A senior deputy from the Fatherland-All Russia party, 
led by Moscow mayor Yuri Luzhkov and former Prime Minister Yevgeny Primakov. 
Govorukhin was a popular film director in the Soviet era and is a 
longstanding centre-left opponent of the Kremlin. 

ALEXEI PODBERYOZKIN - Podberyozkin, former assistant to Zyuganov, left the 
Communist Party to form his own Spiritual Heritage party. He is seen as 
representing the intellectual wing of Russia's Communists. 

YEVGENY SAVOSTYANOV - The former head of the Moscow department of the FSB 
domestic security service and one-time member of the Kremlin staff. Currently 
the head of the Moscow fund of presidential programmes. 


Russian Communists call for Chubais to be sacked

MOSCOW, Feb 21 (Reuters) - Russian Communist Party leader and presidential 
hopeful Gennady Zyuganov on Monday called for the dismissal of Anatoly 
Chubais, chief executive of Russia's national power grid Unified Energy 
System (UES) EESR.RTS. 

``Chubais and our government have again decided to plunge Russian into 
darkness again,'' Zyuganov told a news conference. 

He said he had written a letter to Acting President Vladimir Putin urging him 
to sack Chubais ``for attempting to break up the single energy complex, 
threatening national security.'' 

Chubais, a leading liberal reformer who has held various senior government 
posts, has long been the focus of bitter criticism by Communists who accuse 
him of selling assets cheaply when he orchestrated Russia's privatisation 

The UES chief gave his backing to the pro-Kremlin Union of Right-Wing Forces 
in a December parliamentary election, but he has recently been criticised by 
Putin who says UES should be improved but not split up. 

Zyuganov called for a state programme to preserve and develop Russia's energy 
network and to determine enterprises that cannot be privatised. 

Chubais said earlier this month that a wide-ranging restructure of the vast 
UES network would be considered at a meeting of the company's board of 
directors in late March. 

UES controls almost every local power utility in Russia's 89 regions as well 
as the national power grid. 

Chubais says UES has become more efficient since he took over the reins in 
1998. The restructuring is expected to generate competition between 
individual energy providers and see transport tariffs and other fees 

The company has also discussed increasing private ownership in some regional 
power utilities, which is one of the conditions for UES to receive a World 
Bank structural adjustment loan. 

A government order last autumn required UES to sell stakes in five 


Russian data boosts Putin president bid
By Julie Tolkacheva

MOSCOW, Feb 21 (Reuters) - Russia issued a slew of favourable economic 
statistics on Monday which analysts said provided a boost for Acting 
President Vladimir Putin ahead of next month's presidential election. 

The State Statistics Committee said the 1999 trade surplus was $33.2 billion, 
more than double 1998's, while January industrial output was 10.7 percent 
higher than a year earlier. 

RIA news agency quoted figures from the government's Centre for Economic 
Trends as showing industrial production this year would rise 1.6 percent 
compared with 1999. 

Analysts expected the economy, propped up by high world energy and metals 
prices, to show the same positive trend at least until the March 26 
presidential poll in which Putin is a clear favourite. 

"The economy will be able to provide a good public relations service and a 
good flow of news for him (Putin),"Yekaterina Malofeyeva, an economist at 
Renaissance Capital, said. 

"He will be able to show that the economy is feeling better than half a year 
ago, or even a year ago," she said, adding that the upward trend looked 
sustainable in the near term. 

Sergei Voloboyev, an economist at CS First Boston, said a high trade surplus 
meant the government would be able to service its heavy foreign debt without 
too much strain and without damaging the rate of the rouble to the dollar. 

"The main economic indicator the electorate will react to is the 
rouble/dollar rate, and since export revenues are so high the central bank 
will have no difficulty in keeping the rate under control," he said. 


Analysts said that even if the Organisation of Petroleum Exporting Countries 
decided to increase output at its policy-making ministerial conference on 
March 27, a day after the presidential poll, Russia would still show good 
foreign trade data for several months. 

Russia's 2000 budget is based on a $17 per barrel price, and given the 
current price of around $26 per barrel price the budget could still enjoy 
enough of a windfall to support economic growth for some time, Voloboyev 

But he warned high oil prices could lull the government into inactivity, 
depriving it of an incentive to reform the economy quickly and radically. 
"The problem is if nothing is done the bright future will seem further and 
further away," he said. 

"Putin has a unique be able to do a lot without looking to 
the parliament and without any populist measures." 

Putin's economic programme is still a mystery but he is expected to unveil 
his ideas this week. 

"If Putin intends to stay in power for more than one term...than he must act 
right now," Volobuyev said. "Oil is a smile of fate which will allow him to 
do it less painfully than in other circumstances." 


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