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Johnson's Russia List


March 27, 2000    
This Date's Issues: 4201  4202   

Johnson's Russia List
27 March 2000

[Note from David Johnson:
1. Reuters: Martin Nesirky, Putin Russian election win all but certain.
2. Bloomberg: Vladimir Putin Comments on Presidential Election Win.
3. The Times (UK): Michael Binyon, Prosperous town's men of God 
keep faith with communism. (Sergiev Posad)

4. Reuters: Peter Henderson, Russia's Far East hopes Putin will bring order.
5. The Guardian (UK): David Hearst, How Russia was lost. The west 
was looking the wrong way as Moscow's next authoritarian figure was rising quietly.

6. Chicago Tribune: Colin McMahon, FOR PUTIN RIVAL, NOTHING FAILS 
LIKE SUCCESSES. (Samara governor Konstantin Titov)

7. Reuters: Karl Emerick Hanuska, Russia's Putin seen creating pro-investor economy.
8. ABC Nightline: The Master Manipulator. (Boris Berezovsky)] 


Putin Russian election win all but certain
By Martin Nesirky

MOSCOW, March 27 (Reuters) - Acting President Vladimir Putin appeared to
have narrowly won Russia's presidential election on Monday after a count
that offered far more excitement than the campaign and highlighted the
tough job he faces. 

Results announced by Central Election Commission deputy head Valentin
Vlasov, based on 84.14 percent of the votes cast on Sunday, had Putin on
51.91 percent. That compared with 29.97 percent for opposition Communist
Party chief Gennady Zyuganov. 

``With nearly 85 percent counted we cannot expect major changes,'' top
Election Commission analyst Dmitry Oreshkin told Reuters. ``Zyuganov may
move a bit either way, Putin may grow a bit, but this will not change the

An absolute majority, however marginal, would mean Putin -- a former KGB
security police agent virtually unknown a year ago -- avoids an April 16
runoff against Zyuganov, and the unseemly horse-trading for votes and
support that would involve. 

The 47-year-old Putin, whose popularity is largely based on the war he has
waged against rebels in Chechnya, may have been spared that bargaining and
squeezed home as Russia's second elected president in the first round. 

But he already appeared chastened by the size of the Communist vote and the
scale of the task ahead. 

``I want to point out the Communists achieved that level even though -- let
us be direct and honest about this -- they did not have that many
opportunities in the media, especially electronic media,'' Putin told
reporters at his campaign headquarters. 

``There are many people in the country who are not satisfied with the state
of things,'' he said. ``People are tired, things are tough for them, and
they expect better things from me. But, of course, miracles don't occur.'' 

Putin took over in the Kremlin when Boris Yeltsin resigned on New Year's
Eve. Yeltsin was shown on television apparently telling Putin by mobile
telephone that he had bet his daughter the acting president would win by 51
or 52 percent. 


Assuming Putin wins, he faces the task of capitalising on a nascent
economic upturn based on high world oil prices, rouble devaluation and
favourable prices for some strategic metals. He has yet to outline his
economic plans and to say how he can end the war in Chechnya. 

Victory would mean Putin would lead Russia, the world's largest country and
second largest nuclear state, at least for the next four years with
sweeping powers. 

He would be inaugurated on May 5, election commission officials said. Only
after that can he name his government. 

Questions remain about the direction Putin will take. Some critics fear his
KGB past makes for authoritarianism. He has backed democratic and market
reforms within a strong state. 

The latest results appeared to reflect greater support for Putin as the
count moved westward toward the more heavily populated Russian heartland in
the Urals and the cities of Moscow and St Petersburg, Putin's hometown. 


A majority of voters in St Petersburg voted for Putin, but Muscovites did
not match this enthusiasm, giving him 46 percent. 

The first returns, mostly from the Far East, had put him on about 45
percent overall. Zyuganov remained doggedly optimistic about a runoff. He
also said there had been irregularities. 

Putin, who spent the day in the country and took a traditional Russian
``banya'' steam bath, arrived at his Moscow campaign headquarters around

``If there is a victory in the first round, even by half a percentage
point, I think it would be a huge advance,'' he told reporters. The mood
among Putin campaign workers was restrained, with plenty of forced smiles,
but cautiously upbeat. 

If Zyuganov retains about 30 percent of the vote it would be a triumph for
him as opinion polls had put him closer to 25. 

Liberal Grigory Yavlinsky moved into the third place with 5.8 percent,
ahead of regional governor Aman Tuleyev. Eleven candidates stood in the
election. The turnout was 69 percent. 

Yeltsin set Putin on the road to the top when he made him premier last
August and declared him his preferred successor. 

Maverick candidate Vladimir Zhirinovsky, who had less than three percent,
said the election had been a waste of time. 

``Yeltsin told us last August 9 that Putin would win. He is his
successor,'' Zhirinovsky told Russian television. ``And the Kremlin decides
these questions. So, so far everything is fine, just as we were promised.'' 


Vladimir Putin Comments on Presidential Election Win: Comment

Moscow, March 27 (Bloomberg)
-- Following are comments by Acting Russian President Vladimir Putin on 
the election, Chechnya, and his first steps after winning the election. 

On victory in a single round of voting: 

``If it is a victory in the first round, even if it is just half a percent, 
then it is a massive advance for the country and the people. But it makes no 
difference, the first round or the second round. It will be clear when we 
have the results. So far we don't have clear results of the election.'' 

On the election results: 

``It seems to me that the experts that made the forecasts seem to hit the 
point: we have to give them credit. We shall see the final results. 

``It seems to me that what we have seen really reflects the reality as it is. 

On what happens today, tomorrow: 

``You and me and every citizen of Russia and Japan has the right to dream. I 
have not got the right to think about tomorrow, about miracles, about the 
start of something. It is just not right. '' 

On the first steps after the elections: 

``We have no right to relax. The government must work. I am acting president 
and this is my duty. We shall work a normal schedule. If there is no second 
round, then we must think about forming the government, inviting candidates 
for prime minister, and consulting with the parliament on this issue. 

``In the worst nightmare I would dream to participate in the elections. 
Before I thought it was a shameless effort to look better than your 

On the problems Russia faces: 

``The difficulty of the situation is that the level of expectations is quite 
high. All I can say is that when I traveled around Russia, I felt people were 
tired and wanted things to be better. That things for them were bad. They are 
waiting for things to get better. Can anything positive be done to avoid the 
potential disappointment? 

``As I see the problem there is only one means -- to be honest. We must 
clearly analyze the situation where the country is today, be honest and 
direct about our proposals. To be clear, to say to the people, I will do this 
and that. 

``Some will disagree, some will support, but this position must be open and a 
few years later it will become clear if we are right and the population can 
draw conclusions about what was wrong and what was right in our approach. It 
seems to me, that this approach will allow us to escape the danger of 
disappointment. If people understand what is happening they won't be 

On possible alliances after the elections: 

``All the people who will be invited to the executive branch must think the 
same. There must be a team that is united in its goals. Each of us, you and 
me, every citizen of Russia, has the right to dream and must dream. But no 
one should pin their hopes on miracles. I don't have the right to say that 
tomorrow there will be miracles. This would be a mistake, to give people the 
hope for miracles. 

``I don't think I have the right to take such decisions right now. I have to 
think about and see what is happening. I must talk with them and will have to 
see if they are prepared to work within the framework of the program proposed 
by the government. If all work will be done along party lines then we do not 
need such people.'' 

On the war in Chechnya: 

``It was important that the people of Chechnya had the chance to vote, and 
they were given the chance. I think that people should have the chance to 
vote for the president of Russia. It is a fact the voting took place in 
Chechnya and that Chechens took part in Russian elections. 

``It is important even from the practical aspect that people have the right 
to demand from the president - those who have voted for him may demand his 

On the Chechen war and the election: 

``Often it is said and I hear it said to myself, that I used in my electoral 
campaign the situation in the North Caucasus. I know what I have done. I try 
to analyze my role adequately. If there were no consolidation of the whole 
Russian society, then we would not have this situation in the North Caucasus. 

``There can be criticism. Let's put it straightforward. Not a single time . . 
.I want to repeat again and I think I don't have the right to monopolize this 
topic - so who will be demanded and how will it be demanded, that is another 


The Times (UK)
27 March 2000
[for personal use only]
Prosperous town's men of God keep faith with communism

MONKS, priests and seminary students voted early in Russia's religious 
capital, Sergiev Posad, casting their ballots in a voting booth set up in the 
vaulted library of the vast and ancient monastery of St Sirgius. 

Priests then said prayers for the success of the elections and pronounced a 
blessing for the future president. Few doubted who it would be. Many of the 
elderly congregation, stoutly wrapped against the chill of the bright 
morning, picked their way across the snowy paths to the 117 polling stations 
set up in schools and community centres across the town and surrounding 

For many yesterday's vote and the news of the latest rebel seizure of a 
Chechen village had a chilling significance: three weeks ago thousands packed 
the magnificent monastery church for the funerals of 20 local soldiers killed 
in an ambush in Chechnya. 

One of the heaviest losses suffered by any Russian town in the Chechen war, 
it sent a shock wave of grief and anger through the tightly knit community, 
underlining the crucial role that the conflict has played in rallying support 
for Vladimir Putin. 

Turnout was high: by 11am, 130 of the 476 monks and seminary students had 
voted. A few miles away a knot of babushki had gathered outside a community 
centre by 8am, ready to cast their votes as soon as the doors opened. One 
local journalist joked: "They're following old habits. In the old days, the 
first to vote was always photographed for the papers and invited to an 
official celebration." 

Most were expected to vote Communist and the official observer from the 
Communist Party, sitting with a representative of Mr Putin's campaign by the 
polling booths, to check on any irregularities, voiced hopes that Gennadi 
Zyuganov might win at least half the vote. But he did so in that voice that 
Russians use to make clear they know that no one will believe them. 

The young came along later in substantial numbers, and by mid-morning a 
polling station in the centre of town was doing brisk business. There were no 
exit pollsters or canvassers: asking people how they voted seemed too much 
like the bad old days of communist "elections". But several volunteered their 
views: "I voted for Putin," a former army officer said. "We need someone 
young and energetic. Those voting communist are doing so out of nostalgia for 
the Soviet Union." 

Prosperity has filtered down here: the shops are full of fresh meat and 
fruit, new buildings, advertisements and petrol stations testify to bustling 
private enterprise. 

But Sergiev Posad is not natural Putin country. Last year, in the 
parliamentary elections, it voted solidly for the Fatherland Party of Yuri 
Luzhkov, Moscow's mayor, largely because so many now commute to the capital. 
However, like little towns all over Russia, Sergiev Posad yesterday appeared 
set to give Mr Putin the mandate he sought. 


Russia's Far East hopes Putin will bring order
By Peter Henderson

PETROPAVLOVSK-KAMCHATSKY, Russia, March 27 (Reuters) - Citizens in Russia's
Far East gave Vladimir Putin a wary thumbs up on Monday on hopes he would
clean up crime and jump start the economy with the same iron hand he has
wielded in Chechnya. 

With most ballots counted by Monday morning, Putin, Russia's acting
president, appeared likely to win Sunday's elections to choose the
country's second post-Soviet leader with nearly 52 percent of the vote. 

``Russia needs a tough person and order. The financiers need to be told
what's what and the people are listening,'' said Nikolai Leontyev, 42, a
former sailor, now unemployed. 

He praised Putin for his background in the secret services to the KGB and
his relentless drive against ``terrorists'' in the breakaway region of

Kamchatka voters did not quite give Putin the 50 percent mandate needed
country-wide to avoid a runoff, with 48.81 percent backing him. Communist
Party leader Gennady Zyuganov, the closest contender, won 28.32 percent
with all votes counted except for those of a few sailors at sea. 

Nearly a decade of attempts at reform and little economic improvement has
left many Russians wary, including those in the Kamchatkan peninsula, which
dangles above Japan nine time zones east of Moscow. 

It is known in Russia for its volcanoes and geysers but its key industry,
fishing, has been hurt. For locals, the burden is double since much of the
fish and caviar produced is sold abroad for hard currency -- or to avoid

``We live in a fishing province, and we can't buy fish!'' said Alesya, 20,
a medical student. 

She voted for the Communists and expected no good from Putin thanks to his
ties to predecesor Boris Yeltsin. 

Nikolai, 45, making copies of keys on the street of one of Petropavlovsk's
main square, saw the acting president's victory as inevitable. He said it
was best not to have a runoff election because of the cost, even though he
cast his ballot for liberal Grigory Yavlinsky. 

He said he expected stability, a hallmark belief of Putin supporters,
though he also raised a popular fear that Putin, who shunned debates and
allowed state-controlled media to wage a vicious campaign occasionally
against his opponents, would let democratic values fall victim to order. 

``It seems to me there will be some pressure on society,'' he said. 

Communists such as Alexandra Raikova, 63, a pensioner, despaired, saying
Putin would not really improve things. 

She was in a heated street argument with another retiree, Lyubov Belyayeva,
73, who was selling canned pickles on the street, until with a laugh the
two recognised each other as old acquintances and found common ground. 

``Why did Yeltsin close the factories?'' asked Raikova, who voted Communist. 

``To line his pockets,'' answered Belyayeva, who supported Putin as an
honest man. 

``Well that is the truth,'' Raikova answered. 


The Guardian (UK)
27 March 2000
[for personal use only]
How Russia was lost 
The west was looking the wrong way as Moscow's next authoritarian figure
was rising quietly
By David Hearst

Ikea has arrived in Moscow. So has a tight-lipped 47-year-old KGB staffer,
with clear blue eyes and authoritarian tendencies strong enough to bomb one
of Russia's republics back into the middle ages. 

The juxtaposition is not frivolous. For the past eight years, the great and
the good arriving by the planeload from the IMF, World Bank, LSE, and
Harvard, spent more time counting the bottles of cabernet sauvignon on the
shelves of Moscow's shops as an indicator of progress, than they did
thinking about what life was actually like at the end of a dirt track
barely 40 miles away. 

After nearly a decade of failed reform, the average life expectancy of a
male in Russia is higher than in Nigeria but lower than in the Philippines,
and this for a country which is sitting on 13% of the world's oil and 36%
of its natural gas reserves. In the pursuit of the theology of market
reform, the realities of Russian life - the halving of the GNP, the
destruction of its industrial base, the loss of ordinary people's savings,
the mass grab of property stolen under the name of privatisation, the
demonetarisation of the economy - were all wished away. 

In their place came theories. First it was the "trickle-down" theory, then
came the "necessary pain" theory. After that came the "good times are just
around the corner" theory. And then came the crash. Now a man like Vladimir
Putin has arrived to remind the IMF just how far the dark continent has
slipped back into the Tsarist 19th century. The west in general and the
champions of human rights in particular have little cause to complain about
the crackdown Putin is planning. 

For eight years, they were looking in the wrong direction for the emergence
of homo sovieticus, the strong man who would restamp Moscow's authority on
its wayward regions and ethnic republics. In the civil emergency of October
1993 and the last presidential election in 1996, the enemy were the
communists. If they won, "reform" - whatever that meant - would have lost.
It was reds versus the whites. The conscious and cynical attempt to revive
the Russian peasant's innate fears of another civil war worked. 

The leading figures of the Russian human rights movement, personally honest
and physically courageous people, were duped. In October 1993, Yelena
Bonner, Sakharov's widow, mounted a truck outside the Kremlin to justify
the stand her friend Boris Yeltsin was making, which led to tanks opening
fire on a parliament that had got a little too independent for the
Kremlin's liking. Two months later, Russia had a constitution which
emasculated parliament, (it became and felt like a private health clinic,
whose sole concern was the wellbeing of its member) and inflated the
presidency to proportions which exceeded those of the hated central
committee of the CPSU. 

These are the powers Putin inherits. Today Bonner calls him Stalin. Andrei
Babitsky, the Radio Liberty reporter who came within a whisker of losing
his life at the hands of fellow Russians in Chechnya, was decorated for his
pro-Yeltsin work in the heady days of democracy. 

The "stalinist" Putin did not emerge from the docile ranks of Gennady
Zyuganov's Russian communist party. The brigades of woolly-hatted
demonstrators waving Red Flags and portraits of Stalin, were led by lambs,
not tigers, who repeatedly backed away from moves to impeach Yeltsin. Those
who despaired, turned the violence they felt against themselves, not the
state. The suicide rate shot up. 

Meanwhile, Russia's next authoritarian ruler was quietly being born in the
ranks of the camp of the "reform ers". Putin's first boss was Anatoly
Sobchak, the mayor of St Petersburg who at one point fled abroad amid
claims of corruption. Putin's next master was Pavel Borodin, the
quartermaster of the Kremlin, now eagerly wanted for questioning by Swiss
prosecutors investigating a multimillion-dollar money-laundering scam. It
was Yeltsin's close family circle who drew the president's attention to the
existence of the quietly efficient ex-KGB man from St Petersburg. 

Today the great and the good are blaming each other for having "lost
Russia". Some say the theories were right, it was just that the money was
not there to back it. Others say the policy should have been to support
principles rather than people, institutions rather than events. Such as an
independent parliament? 

But lost Russia they have. When Yeltsin was first elected president of
Russia, and then when the Soviet Union imploded, the streets of Moscow were
filled with pro-western euphoria. Russia threw open not just its front
windows, but its doors, backyard and granary to the west. Today the west is
seen, even by intellectuals , as venal, self-serving and hypocritical. 

Re-engaging Russia would take need a major u-turn in western policy. It
would involve a conscious attempt to buy Russian technology, rather than
treat it as a third world source of raw materials. Nato would have to stop
expanding, and the problems of Russian-speaking minorities in Ukraine and
Latvia addressed. Russia would have to be treated as a serious player on
the international stage. None of this is likely. 


Chicago Tribune
March 26, 2000
[for personal use only]
By Colin McMahon 
Tribune Foreign Correspondent 

SAMARA, Russia -- The southern Russian region of Samara is held up as a
model of Western-style reform.

The Samara government has cut taxes, slashed red tape, given people the
right to buy and sell land. It pays pensions and wages on time. It pays its
debts. Samara's people have more money in their pockets than most Russians.
Its businesses have more freedom to maneuver.

All this should well serve the man behind Samara's reforms, Gov. Konstantin
Titov, as he seeks Russia's presidency in national elections Sunday. He
doesn't stand a chance.

Most Russians will not vote for him. Most Samarans will not vote for him.
Even Titov's own party will not vote for him. Titov is the only
presidential candidate actively instituting the changes that the West says
Russia needs to prosper. For this he will be lucky to get 3 percent of the

Just over eight years have passed since the Soviet Union collapsed and the
Russian Federation embarked on its path toward democracy and a free-market
system. Sunday's presidential vote is another sobering example of how
difficult that path remains.

Distrustful of the market reforms advocated by Western advisers and by the
odd liberals such as Titov, the Russian people have embraced Vladimir
Putin, a former KGB agent with few reformist credentials and a murky
economic philosophy.

Distrustful of true democracy, former President Boris Yeltsin and the
Kremlin officials and special interests behind Putin have stacked the deck
in favor of the acting president's campaign.

"This is not a real democratic election," said Sergei Saveliev, a vice
governor in Samara, discussing his boss' plight not with anger but
resignation. "Putin was not elected as Yeltsin's successor, he was
selected. And the people support Putin because they want a czar, a good and
kind czar."

Titov, a 55-year-old economist and former flight engineer, is popular in
Samara. The Volga River city was called "Little Chicago" in the 19th
Century because of its grand waterway, its railroad connections, and its
surrounding fields of grain and livestock. Decrepit pre-Bolshevik mansions
speak of the region's past as a place where money could be made.

Titov and his team say Samara is again such a place.

To unlock its potential, they are committed to getting the state out of
people's lives. Titov has trimmed the region's bureaucracy, going against a
nationwide trend that has seen Russia's government workforce grow even
beyond Soviet levels.

Russia has a government payroll exceeding 20 million; its overall
population is about 145 million and shrinking.

Most of the sensitive issues in Russian politics trip up Titov.

He wants Russia not to stare down the West but to be more integrated with
it. He opposed, for example, Moscow's freezing of cooperation with NATO
over the Kosovo war.

He has called for talks to end the war in Chechnya. This stand more than
any courts scorn with an electorate that strongly backs Putin's hard line
in the troubled Caucasus.

"Putin's support is based mainly on the Chechen factor and on the
strong-arm factor," said Nikolai Popov, a Moscow pollster and analyst. "He
is generally considered as a person capable of putting things in order in
this country."

Indeed, words like "order" and "state" roll off Putin's tongue during most
every public utterance. Titov is wary of such talk.

"The strategic course of the entire world now is aimed at the development
of man, the guarantee of his rights," Titov told supporters last month. "If
Russia again heads only for creating a strong state, we shall again lag
behind the entire the world."

Despite Titov's high approval ratings at home, many of his supporters are
expected to vote for Putin given the hopelessness of Titov's cause. Some
Samarans dismiss Titov's candidacy as a Kremlin plan either to make the
election appear legitimate or to steal votes from other liberals such as
Grigory Yavlinsky. Some Samarans even said they would vote against Titov so
that he would have to stay in Samara and run for governor again at the end
of this year.

Yet Titov has his share of critics. They wonder why the roads, buildings
and infrastructure are falling apart in the region of 3.3 million people,
especially in the city of Samara itself. They characterize Titov as a tool
of big business.

"He's a mafioso," said Natasha Pokolova, a middle-age educator in a fur hat
and mod sunglasses who said she would vote for the Communist candidate,
Gennady Zyuganov. Zyuganov is expected to finish a distant second to Putin.

"This wild capitalism of Titov's," Pokolova said, "it has done everything
for the gangsters and nothing for us."

Behind Pokolova on the edge of a Samara market, a chorus of about a dozen
young Russian women in traditional peasant costumes was serenading
passersby. To the tune of an old folk song, they turned out to be stumping
for Titov.

"I'll vote for Titov. I'll vote for Samara," the young women sang in high,
sweet voices. "It will make me calm, and I won't worry."

Seemingly oblivious to the show, Pokolova was complaining about the
collapse of culture since Soviet days.

"Wild capitalism," Russia's unique mix of laissez-faire, governmental
corruption and legal chaos, has been disastrous in much of Russia. A
relative few have gotten very rich over the last decade. Many Russians have
suffered tremendous drops in their standard of living.

The failures of Yeltsin-era reformers to build a real economy has helped
condemn the electoral hopes of Titov and other liberals.

Titov's successes are little-known beyond his home region or among liberals
and political observers in Moscow and St. Petersburg. Like Yavlinsky, he
could have benefited from a real, robust electoral campaign. That did not

One reason it didn't was Yeltsin's decision to resign on New Year's Eve and
make Putin acting president. It shortened the campaign season to only three

As during December's parliamentary elections, where parties backing Putin
did surprisingly well, the Russian media has proven again to be an
effective Kremlin tool.

"The impression is that the election campaign is being constrained from the
top," said Dmitry Olshansky, a Moscow-based pollster and analyst.

"Not only is there silence on the front of candidates. There is silence
also on the front that should be manned by commentators, analysts and so
on," Olshansky continued.

"The campaign is at its peak but there are no discussions at all. Nobody is
discussing anything."

News on Russian national television, most of which is state controlled, was
in the words of a Moscow media critic, "All Putin, All the Time."

Though Putin said he was just doing his job as acting president, his recent
performance could have been scripted by campaign central.

He eagerly exploited the advantages of incumbency, visiting factories, war
veterans and, in the most dynamic performance, soldiers in the Chechen
capital of Grozny.

Putin flew to Grozny in the co-pilot's seat of a Russian jet fighter,
reportedly even taking the controls for part of the ride. He then awarded
medals to some Russian soldiers leaving Chechnya for their home bases. All
of it was thoroughly covered on the news.

Putin's electorate is eclectic. He is supported more by the young than by
the old, who tend to back the Communists. He is supported more by centrists
and reformers than by leftists.

He even won the official support of Titov's own party, the Union of Right

Known by its Russian acronym SPS, the Union of Right Forces won a shocking
23 percent of the December vote in Samara as it gained a foothold in
parliament. Titov got credit for that Samara performance. But when it came
time for the Union of Right Forces to back a candidate, the leadership
chose Putin.

"It would do more harm than good to oppose Putin personally," said Irina
Khakamada, one of the leaders of the Union of Right Forces. "When you do
that to military-type people they start to really dig in and take up
repressive, dictatorial methods."

The latest surveys show that more than half of eligible voters will go to
the polls, making the election valid.

The only other question is whether Putin will get more than 50 percent of
the votes. If he does, he wins. If not, he would head to a runoff in three
weeks against the second-place finisher.

That No. 2 will not be Konstantin Titov. Russians skeptical of the West and
of capitalism can sleep easy.


Russia's Putin seen creating pro-investor economy
By Karl Emerick Hanuska

MOSCOW, March 27 (Reuters) - Acting President Vladimir Putin's probable 
victory in Russia's presidential election should usher in long-awaited 
reforms to attract investors and get the economy back on track, analysts said 
on Monday. 

After apparently running up enough of the vote to avoid a runoff, Putin 
inherits an economy which, thanks to high oil and metals prices, is at its 
strongest in nearly a decade of political turbulence and stop-go measures. 

Russia is running a strong trade surplus, has healthy budget revenues, and 
central bank foreign exchange and gold reserves are at levels not seen since 
before the 1998 economic crash. 

That, coupled with a pro-Kremlin parliament, means that for now Putin should 
have the muscle to secure passage of any reforms he supports. 

Analysts said that while Putin, 47, has been short on the specifics of his 
economic plan, he has clearly indicated his intent to create an 
investor-friendly business climate. 

"The greatest mystery about Putin is why everybody finds him so mysterious," 
said Eric Kraus, chief strategist at NIKoil. 

"His actions and words... are in keeping with the Chinese model: a more 
restrictive foreign policy, a restrictive domestic policy and a very open and 
investor-friendly economic policy." 


Kraus saw eager investors boosting Russian markets on the election results. 
Investors, optimistic about the prospects for a Putin presidency and strong 
economic fundamentals, in the last month have already driven shares back to 
pre-crisis levels. 

But Kraus said the long-term investment picture would depend on Putin 
tackling individual issues like corruption, streamlining bureaucracy and 
addressing investors rights. 

"There's a whole mess there that he has to wade through, but for the first 
time in a while I am reservedly bullish," he said. 

First Deputy Prime Minister Mikhail Kasyanov, a skilled debt negotiator 
widely tipped to head the new government, told CNN creating an 
investor-friendly economy was a priority for Putin. 

"That means first of all to eliminate the contradictions in legislation which 
exist now that prevent (domestic) and foreign investors from investing more 
and operating in Russia more effectively," he said. 

Kasyanov said it was also important to adopt a new tax code, easing the tax 
burden. "Everything goes in the direction of creating a more attractive 
investment climate." 


Roland Nash, chief economist at Renaissance Capital, also saw Putin intent on 
attracting investors, but said the first months of Putin's presidency would 
focus on political issues. 

"I think there are three key areas he is going to concentrate on. He has said 
time and time again that he is going to create a strong state, to centralise 
control and create stability in the country," Nash said. 

"On the back of that political and economic stability he hopes to get the 
investment which is (necessary) to build a strong economy." 

Analysts said that while serious reform may still be a little while in 
coming, major investors were finally warming again to Russia after having 
been burned in the 1998 crash. 

"Six months ago if you called investors and wanted to talk to them about 
Russia they hung up on you," NIKoil's Kraus said. 

"Now people -- and that includes the big investors -- are seriously thinking 
about Russia again while it's still cheap... They know that its time to come 


ABC News
March 23, 2000
The Master Manipulator 

(This is an unedited, uncorrected transcript.) 
Prepared by Burrelle’s Information Services, which takes sole
responsibility for accuracy of transcription

TED KOPPEL, ABCNEWS One of Russia’s most popular television shows lampoons
him as the sinister power behind acting President Putin.
(Clip is shown of television program)

TED KOPPEL He believes the Russian security service may have been behind at
least one attempt to assassinate him. Why would they want to kill you?

BORIS BEREZOVSKY Possibly because for the last year, I prey—I play some
role in Russian political life.

TED KOPPEL His many enemies call him “The Devil,” “The Godfather.”
“The Master Manipulator,” what about him?

BORIS BEREZOVSKY Yes, I agree with that.

TED KOPPEL Tonight, Russian Revolutions. Boris Berezovsky, the unseen power.

ANNOUNCER From ABCNEWS, this is Nightline. Reporting from Moscow, Ted Koppel.

TED KOPPEL There’s no one in the United States who cuts quite the figure
that Boris Berezovsky does here in Russia. Imagine someone with the ego of
a Donald Trump, the ambition of a Ross Perot, the instincts of Rupert
Murdoch, and the business reputation of a John Gotti. Then imagine that
person controlling industries and resources equivalent to about 10 percent
of the entire national economy and you begin to get a sense of Berezovsky’s
power and influence here in Russia.
He is as notable for his enemies as his friends. There have been several
assassination attempts on Berezovsky and several more to have him
prosecuted for criminal activities. One such effort was initiated by former
Prime Minister Yevgeny Primakov. Only last spring, Primakov was the odds-on
favorite to become the next president of Russia. Not after Berezovsky got
through with him.
(VO) The kind of wealth and power that Boris Berezovsky controls comes at a
price. He lives surrounded by bodyguards in a tightly secured country house
that was built for, but never occupied by, Mikhail Gorbachev, who thought
it too ostentatious. This particular bedroom community lies on the
outskirts of Moscow, populated by top government officials and those who
got rich during the Yeltsin era. Berezovsky is very rich. Until recently,
he controlled Russia’s national airline, Aeroflot, much of the country’s
oil, a string of newspapers and two of Russia’s television networks.
Recently, he and a partner gained control of most of the country’s aluminum
(VO) The American billionaire, George Soros, has written of Berezovsky ‘He
has no difficulty subordinating the fate of Russia to his own. He genuinely
believes that he and the other oligarchs bought the government by paying
for the re-election of Boris Yeltsin.’
(VO) In the dining room where he takes his meals with his third wife and
two of his six children are several secure phones: to the outside world, to
the Kremlin, and...

BORIS BEREZOVSKY This is the phone to bodyguards.

TED KOPPEL To bodyguards.


TED KOPPEL Right. Why do you need bodyguards?

BORIS BEREZOVSKY I have several—I had several attempts to kill me. Maybe
the most famous was in ’94. I went to the car near my office, was explode.
And my driver was killed, and one of my bodyguards was damaged, seriously
damaged. I also has—had some problems, but not big. And all the other
times, I had bodyguards maybe not so professional, like now. But after
that, I organized better protection.

TED KOPPEL Do you have to have protection for your whole family, for your
wife, for your children?


TED KOPPEL Why is that? Is that part of—of the price of doing business in
Russia today?

BORIS BEREZOVSKY No, it’s a part of transformation of Russia. And you know
that we had very, very tough last 10 years. And it’s clear why, and because
early in Russia, a revolution happened in reality. And we are lucky that we
didn’t have—we didn’t have a civil war. But all the rest attributes from
revolution we had and still have. And the main sense of revolution for sure
is the changing of—of the owners of property. And in ’99, we had hun—near
100 percent of state property. Today we have 75 percent of private
property. And no one is happy. No one. Everybody unhappy.

TED KOPPEL (VO) There have been other assassination attempts. Berezovsky
claims that several sources have told him state security men have also
tried to kill him.
Why would they want to kill you?

BORIS BEREZOVSKY I say because for the last year, I play—I play some role
in Russian political life. And not everybody were happy with that. When
those people fight for the power, they use all arguments,
including—including—including force.

TED KOPPEL (VO) Anatoly Chubais, former deputy prime minister, is an
If Putin was worried about getting the necessary 50 percent so that there
doesn’t have to be a runoff election, he could probably get an additional 2
percent by arresting Berezovsky. Would he ever do that?

arrest Berezovsky, he could get 2 percent or even more.

TED KOPPEL Do you have any reason to believe that if there were an
investigation that Mr. Berezovsky would be in trouble?


TED KOPPEL You think he would be in trouble?

ANATOLY CHUBAIS I think if it will be the real investigation which will
confirm this kind of accusation, in this case, he could really be in trouble.

TED KOPPEL (VO) Berezovsky has clearly used his money and influence to help
Vladimir Putin in his rise to power. But...

BORIS BEREZOVSKY I trust him. You see, what—what, again, what means trust
him? I really think that as a person he is good. But it is completely
different as a person and as a president. And many people ask me, ‘Boris,
are you sure that if he becomes president, he would not put you in jail?’ I
said, ‘No, I’m not sure.’ Because if you think that it’s rational for him
as a president to put me in jail, he put me in jail.

TED KOPPEL (VO) There has in Russia always been a strong undercurrent of
anti-Semitism. There are many other reasons why Berezovsky is an unpopular
figure in this country. But the fact that he is also Jewish adds to the mix.

BORIS BEREZOVSKY In Soviet time, for Jews to think about participation in
real political life...

TED KOPPEL Impossible.

BORIS BEREZOVSKY ...impossible.


BORIS BEREZOVSKY But I feel that I would enjoy it. And the most important
in everything what I’m doing all my life.

TED KOPPEL (VO) Last fall, Berezovsky campaigned for and won a seat in
Russia’s parliament, the Duma.
Let me tell you what some of your enemies are saying about the—about the
election, the one you just won.


TED KOPPEL They say Berezovsky wanted to become a delegate to the Duma
because then he has immunity against prosecution. True?

BORIS BEREZOVSKY Absolutely wrong. And I’ll explain to you why. Because, as
you know, the Duma has power to stop mandate of any—of any member.

TED KOPPEL They’ve only done it once.

BORIS BEREZOVSKY OK, but it—I mean, according of law, yes.


BORIS BEREZOVSKY And maybe you know that twice Duma elected—elected against
of me 100 percent.

TED KOPPEL You’re saying even though you have immunity as a member of the


TED KOPPEL ...that if someone comes after you, if they try to prosecute
you, if they want to put you in prison...


TED KOPPEL ...your colleagues in the Duma will help them.

BORIS BEREZOVSKY Absolutely. No doubt.

TED KOPPEL When we come back, with just a few billion dollars and a couple
of television networks at his disposal, how Boris Berezovsky helped pick
the next president of Russia.

ANNOUNCER This is ABCNEWS: Nightline, brought to you by...

(Commercial break)

TED KOPPEL (VO) During our walk on his estate overlooking the frozen Moscow
River, Berezovsky told me how Boris Yeltsin unsuccessfully auditioned a
sequence of four prime ministers, looking for the right successor, the
right mix of toughness and commitment to reform. None measured up,
including the last of the four, Sergei Stepashin.

BORIS BEREZOVSKY Doesn’t have his own opinion. Tried to—to—to—to be good
for everybody. Impossible. Because Russia has now transformation time.


BORIS BEREZOVSKY You need to be very strong to do that, like Yeltsin, let’s
say. Yeltsin really was strong to—to—to move country.

TED KOPPEL So that brings us now to—to Vladimir Putin.




TED KOPPEL Reformer?


TED KOPPEL You’re sure?


TED KOPPEL Did you have anything to do with it? In other words, did you—did
you support him?


TED KOPPEL ...from the beginning?

BORIS BEREZOVSKY At that time, I knew him, but, we—we really have had good
relations, but I was not in his team. He was not in my team. And I just
knew him.

TED KOPPEL (VO) Berezovsky was having an uncharacteristic bout of humility.
When we arrived at his house, he was breakfasting with Sergei Dorienko
(ph), the anchorman of the most influential news program on the most
powerful television network in Russia, Channel One. Over the past few
months, Dorienko has ruthlessly trashed every one of Vladimir Putin’s
political rivals. Dorienko is employed by Boris Berezovsky.
You have enormous influence on public opinion in this country through your
television holdings.

BORIS BEREZOVSKY There are, let’s say, a lot of speculations that I have a
special influential power to Dorienko, the most famous TV anchor. And I’m
may tell you, I have just one opportunity compared with the others. I have
chance to discuss with Dorienko.

TED KOPPEL You’re being too modest.


TED KOPPEL I mean, you own the shop. You own the store. You own—you have
a—the largest private interest in the network.


TED KOPPEL He has to pay a little bit of attention to what you say. No?

BORIS BEREZOVSKY No, again, he has all the time choice, because we compete
with the other channels. We compete with the other newspapers. And any
journalist has a choice who he will follow my understanding, or if he
doesn’t agree, and if he will feel that I press him, he will go—he will go
to the other newspaper or TV. I never gave order to anybody, ‘Write,
please, that and that.’

TED KOPPEL (VO) At which point, I showed Berezovsky an excerpt from the
popular satirical TV program “Kukli” (ph), on which puppets are used to
depict Berezovsky and Kremlin chief of staff Voloshin (ph) fixing a fight
for the nervous Vladimir Putin. We later had actors put the dialogue into
(Clip is shown of “Kukli”)

TED KOPPEL Well at least you were smiling. That’s not bad. As with all
satire, there’s—there’s a fundamental belief among many people that that
represents the truth, that you’re the power behind the power.

BORIS BEREZOVSKY For sure, it is stupid to be serious discussing about the
“Dos” (ph) program and there’s a “Kukli” program. And—but, nevertheless,
it’s a—it’s real political fight and this generally is—this problem as a
political leverage, the message here, Putin is not independent, and
Berezovsky and Voloshin is—are behind of him and relative. Not Putin, let’s
say, manage the situation, but the other people, so-called family of
Yeltsin manage. And as far as humor is the best way to produce impression
that it is true. It is very good idea.

ANATOLY CHUBAIS What’s really said by Berezovsky is that his position, is
that business should appoint government. That’s something which I will
never accept. Absolutely disagree with it. I’m absolutely convinced that
that’s the false ideology, false principles, and that is my basic
disagreement with Berezovsky himself.
(Clip is shown of “Kukli”)

(Commercial break)

TED KOPPEL (VO) Boris Berezovsky never appears in public without a phalanx
of bodyguards. Assassination is always a threat. He changes his route, his
approach to a building, without warning. At the Duma, though, the
parliament to which he’s just been elected, he is merely one more
representative of a region, a freshman. The office which he has been
assigned is, as he puts it, “sad.” This is hardly the style to which he is

BORIS BEREZOVSKY It was very, very bad until we clean it and put papers and
so on.

TED KOPPEL So what do you do here?

BORIS BEREZOVSKY Nothing, as you see. Nothing. Just...

TED KOPPEL (VO) No one, friend or enemy, underestimates Berezovsky’s
intelligence, his bluntness, or his fierce Russian pride.
I think that there are a lot of hurt feelings in Russia. I think there is a
sense of disappointment in Russia, about the role that the United States
has played over the last few years.

BORIS BEREZOVSKY You see—you see it. We very—very naive in Soviet time,
very naive. I would—I mean we—those who wanted to change the country, who
didn’t like communism and so on, we really thought that West is absolutely
altruist and immediately they just will do several steps, West open their
mind, open their hand, and will help us tremendously. It didn’t happen. But
it’s a new reality, and I think even that West did not support so—so—so
strong Russia, help again to us, because we need to learn ourself.

TED KOPPEL A sense of independence.

BORIS BEREZOVSKY A sense of independence and sense of you—you did it yourself.


BORIS BEREZOVSKY It’s very important. But as far as future is concerned of
relations of United States and Russia, I think we will have a lot of
problems, a lot of problems. And I may tell you why. I don’t think that
Russia will think—will think now in terms of dominating the world. But
Russia will try to become a part of, as I told, Western society, first of
all, Europe, and will have intersection of interest with the united States.
I think so.

TED KOPPEL And their great power again? Will Russia once again become a
great power?

BORIS BEREZOVSKY I think that it’s very natural, not just for individual,
but also for the countries to—to try to—to dominate. It doesn’t mean to be
aggressive. And you also as a state, as a great state, you try to—to
implement your culture, to implement your position in business, your
vision, how it is to be developed, not just in the United States, but other


BORIS BEREZOVSKY And I think it’s very natural that Russia step by step
will try to take the position in the—in the Europe and in the world.

TED KOPPEL (VO) It is from here, his office, his club, that Berezovsky
establishes his own position in the world. It’s a gaudy, rather tacky, if
well guarded 18th century mansion, with bulletproof glass and an
underground entrance. This man accumulates enemies as efficiently as wealth.
You know all the different images of you around the world. Some of them are
quite extreme, quite cruel, even. I mean, there are some people who think
you are almost a gangster.

BORIS BEREZOVSKY It’s really extreme. But, when I think about Russia I
think that Russia is extreme.

TED KOPPEL Everything in great passion. Everything extreme.

BORIS BEREZOVSKY Yeah. Yeah. And you see, again, you see sometimes it’s
very—it’s very curious even for me why I’m so quiet when people say , ‘You
are a gangster. You are a Godfather and so on.’ So many people said—told
about that. And so many people tried to prove that, and no one was even
successful, not in killing, that I killed someone, but that I steal
something or did something not—not in frame of laws. No one prove that. No
one. And now I decide why I need to react to that. I’m absolutely quiet.

TED KOPPEL Boris Berezovsky, the master manipulator, what about him?

BORIS BEREZOVSKY Yes, I agree with that. But my manipulation is just that I
am able to say what I think is relative. Somebody said it’s manipulation.
Somebody said that he’s—he’s devil. Let’s say mayor of Moscow Luzhkov said
that I’m ‘devil.’


BORIS BEREZOVSKY It’s again, it’s up to those people who try to define who
I am. But I know who I am. And I’m absolutely quiet. I’m absolutely...

TED KOPPEL At peace.

BORIS BEREZOVSKY Yeah. With myself. It’s the most important.

TED KOPPEL You’ve been very gracious to us and very hospitable, very kind.
And I thank you.

(Commercial break)

TED KOPPEL Boris Berezovsky is not counting on the support of his
colleagues in the Duma or the gratitude of Vladimir Putin. His power rests
almost entirely on his ability to make money and his willingness to use it.
And even that may not be enough to protect him.
Tomorrow night, in his first appearance on American television, acting
President Putin tells us how he plans to deal with corruption in Russia if
he’s elected on Sunday. And you’ll find out what the Russians mean when
they say, ‘There’s no such thing as an ex-KGB man.’
That’s our report for tonight. I’m Ted Koppel in Moscow. For all of us here
at ABCNEWS, good night.


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