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Johnson's Russia List


May 4, 2000

This Date's Issues: 4283  4284


Johnson's Russia List


4 May 2000


[Note from David Johnson:
1. Itar-Tass: 10% of Richest Russians Hold 1/3 of POPULATION'S Income
2. Itar-Tass: Russian Journalists Launch Campaign Against Bureaucrats
3. Bloomberg: Russia Plans to Increase Kremlin's Authority
Kommersant Says.
4. The Russia Journal: Vera Kuznetsova, Putin looking for proper opposition.
5. Trofim Lobachov, Symbolism Plagues Inauguration Organizers.
6. RFE/RL: Paul Goble, Idel-Ural And The Future Of Russia.
8. Rossiyskaya Gazeta: Yabloko's St. Petersburg Ambitions Viewed.
9. United Nations Economic Commission for Europe: Michael
10. US State Department: Eurasia Overview and Russia sections of PATTERNS OF GLOBAL TERRORISM: 1999.]




10% of Richest Russians Hold 1/3 of POPULATION'S Income.


MOSCOW, May 3 (Itar-Tass) - Ten percent of Russia's richest citizens received

33.7 percent of the population's income in cash in the first quarter of the

year, while 10 percent of their poorest fellow citizens received only 2.4

percent, according to a preliminary report released by the State Statistics

Committee on Wednesday.

In the first three months of this year, 10 percent of the richest Russians

accounted for 40.7 percent of overall income, while the share of the 10

percent of the poorest citizens was 2.7 percent.


The number of people whose per capita income exceeds 2,000 roubles a month

grew from 13.2 percent in the first quarters of 1999 to 27.4 percent in the

first quarter of this year, while the number of people with monthly per

capita income of less than 400 roubles dropped from 6.9 percent to 4 percent



Per capita income in Russia in March was 1,876 roubles, 8.6 percent up from

February 2000 and 39.8 percent up from March 1999.


Real income increased in the first quarter of 2000 by 7.4 percent from the

same period last year but shrank by 17.5 percent from the fourth quarter of



Average monthly calculated nominal wage in Russia in March 2000 increased by

184 roubles (about 10 percent) compared to the previous month to 2,023

roubles, 51.5 percent up from March of last year.


Real average monthly wage in March increased by 9.3 percent from February

2000 and by 23.7 percent from March of 1999.


Average pension in Russia in March was 612.7 roubles, a 1 percent increase

from February 2000 and a 52 percent increase from March 1999.


The real size of pensions in March was 0.6 percent smaller than in February

of this year and 24.1 percent bigger than in March 1999.





Russian Journalists Launch Campaign Against Bureaucrats.


MOSCOW, May 3 (Itar-Tass) - Secretary general of the Union of Russian

Journalists Igor Yakovenko has declared a new project launched by the Union

of Russian journalists preliminarily titled "Enemies of the Russian press"

with the aim to disclose names of politicians and state officials who impede

journalists' activities. The final "disclosures" are planned to be made by

January 13 when Day of the Russian press is celebrated.


This project is an analogue of an action staged by the US Committee for

defence of journalists which for many years already makes public its own

world list of "enemies of the press" on the World Day of the free press

celebrated on May 3.


Candidates for the "black" list will be decided by the journalists community,

Yakovenko said. A final decision rests with the jury numbering 33, which will

include experts and journalists. None of the leaders of the Union of Russian

Journalists will be in the jury, Yakovenko assured.


Intermediate results of the planned action will be summed up every month.

Thus, the first results of the campaign against "enemies of the press" might

be made public already in May, Yakovensko said. Several "candidatures" to the

black list are already known, he added. In his opinion, these "candidatures"

might include heads of several federal ministries and some Duma deputies who

came out and voted for annulment of taxation privileges to the mass media,

regional leaders of the Saratov region who unilaterally used censorship

against a publication in the Izvestia daily and someone else.





Russia Plans to Increase Kremlin's Authority, Kommersant Says


Moscow, May 3 (Bloomberg)

-- Russia plans to change the presidential administration to expand its

authority in Moscow and the regions, the Kommersant daily reported, citing a

draft document from the Kremlin. The proposal calls for increasing the number

of posts that would report directly to the president and for making the

country's Security Council a part of the administration. The program also

calls for having the Federal Security Service, the successor organization to

the KGB, work together with the administration, the paper said.


President-Elect Vladimir Putin will choose a prime minister after his

inauguration next week, which parliament must then approve.





The Russia Journal

May 1-7, 2000

Putin looking for proper opposition

By VERA KUZNETSOVA / Special to The Russia Journal

Not so long ago, President-elect Vladimir Putin told a small circle that he

would like to see a stable party system in Russia that would provide a solid

political foundation for power.


Putin didnÆt say which stable parties he had in mind and how many of them

there should be, but officials hastened to draw their own conclusions, and

talk immediately turned to a two-party system. Traditionally, that means left

and right, conservatives and liberals, or, in the Russian version, Communists

and Democrats.


ItÆs still too early to speculate on potential union between democrats,

liberals and other representatives of the right. The Communists, however, are

a different matter. They already have a serious party, though lately, the

KPRF has been looking a little stranded on the margins as it is cut off from

large assets and financial resources.


The party is fully aware of this. That probably explains why representatives

of the old red nomenklatura ¡ Gennady Seleznyov, Yury Maslyukov, Nikolai

Ryzhkov and Anatoly Lukyanov, are set on party reform. TheyÆre not talking

about a split in the KPRF; rather, as experienced politicians, they have come

up with a more skilful maneuver ¡ create a broader left front that would

swallow the KPRF.


Most likely, a founding congress will soon be held of a new patriotic

movement ¡ the Union of Peoples of Russia, which will be led by the

aforementioned Communists. The KPRF will become just one component of the new

union and its leader, Gennady Zyuganov, will find himself in the shadows.

Essentially, itÆs like Perestroika Part II.


The Kremlin is paying close attention to this new initiative from the left.

So far, the Kremlin has always been happy enough with the KPRF and with

Zyuganov, who acted as a channel for the discontented populace to let out its

steam without being too dangerous a rival.


Western politicians could envy Putin having such a convenient, inexperienced

and malleable opposition. There are no popular uprisings to worry about, no

riots, strikes or sit-ins on railway lines. The oligarchs donÆt pay ¡

Zyuganov doesnÆt play any nasty tricks, doesnÆt topple the young reformers

with the help of striking workers.


But the Kremlin also needs an active political life that will draw the

publicÆs attention away from thoughts on division of assets or on the new

authorities themselves. Party-building is a perfect way to keep public

opinion busy ¡ there they are, the "evil Communists" who are getting in the

way of progressive reforms on the left.


While the left fights with itself, the Kremlin strategists will reap the

fruits, killing two birds with one stone ¡ creating an opportunist and hence

dependent movement, and blowing up an accompanying political scandal.

Oligarch politician Boris Berezovsky, it is said, has already given the order

to his propaganda people to revive the "communist threat" in the media.


Berezovsky obviously isnÆt content to have just created Yedinstvo (Unity),

which has no clear ideology except to support the president. Now he wants to

create a party on the left that he could fashion into a "proper opposition."

It wouldnÆt look quite right, after all, not to have an opposition.


Unlike Berezovsky, Kremlin officials insist that they will not actively

intervene in the battle for power on the left, though they donÆt hide the

fact that they will support the initiative, if needed. Who has the courage,

reaps the rewards. Seleznyov has already beaten a path to PutinÆs office, so

he can expect support right from the top. And since the political elite has

already lined up behind Putin, itÆs a matter of duty to put their political

capital in the right place.


No one will condemn Ryzhkov, Maslyukov and their comrades ¡ theyÆre fighting

for power, after all, and unlike Zyuganov, for real power. TheyÆre trying to

win some government jobs for themselves and their colleagues. Maslyukov could

get his desire, too, and be put in charge of, say, industry.

But some Kremlin officials think itÆs too much to pay for an active political

life with government jobs. What is needed, these officials say, is a more or

less homogenous government of pragmatic people who will carry out specific

tasks. These include, as Putin has put it, "debureaucratizing" the economy ¡

that is, drawing up the legislation that would enable market reforms to be

seen through and also carrying out legal and constitutional reform.


The whole Kremlin administration is working on plans for these reforms at the

moment. It would be a useful thing, when the time comes, to push all this

through the Duma, to have a "constructive opposition" that would understand

the need for these changes.


To push through changes to the constitution, the Kremlin would need to get a

two thirds majority in the Duma. So, there are good reasons to play at

party-building and perhaps to even hand out some government portfolios.





May 3, 2000

Symbolism Plagues Inauguration Organizers

By Trofim Lobachov

The ice-hockey championship in St. Petersburg and the upcoming victory day

parade would alone be sufficient to keep the Kremlin Property Manager busy,

but currently his main worry is the presidential inauguration ceremony on May


Gazeta.Ru can reveal several details about the rush in the KremlinÆs

corridors to prepare for the inauguration. Only a prophane may think that the

inauguration is just a speech, an oath and congratulations from all those

invited. For insiders, the reality is that inauguration is a means of

self-positioning and establishing themselves in the new regime, therefore,

the particularities of protocol, meaningless to an outsider, are the cause of

passionate conflicts.


Although the Kremlin administration has already drawn up basic plans

for the inauguration ceremony, drastic changes are still possible. The

ceremony itself will take place not in the Palace of Congresses, a relatively

new building built in the Khrushev era and the venue for Boris YeltsinÆs

inauguration in 1991 and his reinauguration in 1996, but in the freshly

restored halls of the Grand Kremlin Palace. The palaceÆs restoration was

overseen by the former head of the Presidential Property Management, Pavel

Borodin, and is the subject of an ongoing embezzlement scandal involving,

amongst others, the latter and the Swiss company Mabetex, and is currently

being investigated by the Swiss authorities. Incidentally, Putin served under

Borodin before being appointed chairman of the Federal Security Service

(FSB), formerly the KGB.


Secondly, it is highly probable that the so-called æFirst President of

RussiaÆ Boris Yeltsin will play a role in the inauguration ceremony.

According to our sources, Valentin Yumashev, former head of YeltsinÆs

presidential administration, strongly lobbied Yeltsin`s role and has

personally written Yeltsin`s part in the scenario. This suggests that,

contrary to common belief, Yumashev`s influence on the æInner CircleÆ, Putin

included, is still strong. It is extremely important for the so-called

æFamilyÆ (Yeltsin`s relatives and confidants) to emphasize the handing down

of Power in Russia.


But reportedly Putin`s team have large reservations about the role

planned for Yeltsin. They fear that it would amount to admitting that

Vladimir Putin has in actual fact inherited his power from Yeltsin. The

scenario planned by Yumashev is that Yeltsin personally hands Putin the

æsecondÆ presidential mandate.


One can recall that the last handing down of Power was even more

irritating; Gorbachev, to put it mildly, did not like Yeltsin, thus the main

figures of the inauguration were the head of the Electoral Commission Nikolai

Ryabov and the chairman of the Council of the Federation Yegor Stroyev.


But this time around Aleksander Veshniakov (the present head of the

Central Electoral Commission) and the same Yegor Stroyev will get their seats

in the first row, but nothing more. This maybe the main reason behind Putin`s

visit to the Orel region; by visiting his home region Putin was trying to

console Stroyev.


The Patriarch will not receive the leading role, as some people in the

administration had wanted, but nether the less a major role, more appropriate

for a secular state. At some moment of the show, Putin and Yeltsin will be on

the stage together, bringing the idea of inheritance to its culmination

point. After that, two presidents will appear before the common people on the

Krasnye Kryltso steps on the KremlinÆs Sobor Square. For this act several

variations are being considered; the showÆs directors assessing whether or

not Yeltsin would be physically capable of ascending the steps and whether

the contrast between him and his fit, young successor would be too harsh,

even indecent.


The Russian political elite is now busy guessing who will get an

invitation to the feast of ômanipulative democracyö on May 7th and who will

be left out. This time around the competition is much stronger as the Grand

Kremlin Palace is way smaller than the Kremlin Palace of Congresses. Another

contentious aspect is that the ceremony will take place in three halls, but

in two of them the guests will only be able to watch the proceedings on

monitors. This makes the major hall of the Grand Palace, the Alekseevsky

hall¡ the priority destination for the guests.


Another challenge for the showÆs organizers is the imposing sight of

the freshly restored throne of the Tsars in the major hall. It must somehow

be draped so as not to appear on TV screens as an ironic reminder of

inherited Power.


Back in 1996 Kremlin officials were faced with a similar task, though

the undesirable object of prominence was of a very different nature; they

were working out how to decorate the main hall of the Palace of Congresses so

as to eliminate the dominating presence of a statue of Lenin, short of

destroying it. Bizarre changes are taking place in Russia, but paradoxically,

at the same time nothing has changed at all.





Russia: Analysis From Washington -- Idel-Ural And The Future Of Russia

By Paul Goble


Washington, 3 May 2000 (RFE/RL) -- Turkic and Finno-Ugric activists in the

region between the Volga and the Urals are reviving an old idea which

threatens to undermine Moscow's ongoing efforts to reestablish control over

Russia's farflung regions.


They seek to create Idel-Ural, the historic name for a confederation of the

peoples of Tatarstan, Bashkortostan, Chuvashia, Mordvinia, Mari El and

Udmurtia and thereby establish an economically and politically powerful

entity between European Russia and Siberia.


The peoples of this region have tried to do so before. Indeed, their efforts

are noted by inclusion in the U.S. Captive Nations Week resolution. But

precisely because such an entity would be so threatening to Russia's

territorial integrity, Moscow repeatedly has taken steps to block any such

move and likely will do so once again.


The latest effort was launched at a conference of non-governmental activists

on April 24 in Ioshkar-Ola, the capital of Mari El. There, these groups

unanimously backed the proposals of the moderate nationalist Tatar Public

Center to set up an Idel-Ural Fund to push the idea via its own newspaper and

to hold two more conferences later this year.


Participants in the meeting told RFE/RL's Tatar-Bashkir Service that they had

taken this decision now because they and the people they represent are

concerned by the intensification of Russian government surveillance of

organizations like theirs which represent ethnic minorities inside the

Russian Federation.


They are also undoubtedly worried by what even Russian scholars now refer to

as the growing Islamophobia among Russians in the course of the fighting in

Chechnya. According to polls, the number of Russians who view Islam as a "bad

thing" has grown from 17 percent in 1992 to 80 percent now.


Indeed and in support of such concerns, the U.S. Commission on International

Religious Freedom on Monday said that Russia is manipulating intolerance

against Muslims to fuel public support for its war effort against Chechnya.


So far, the activists who met in Ioshkar-Ola last week do not enjoy even the

public support of the governments in the regions from which they come. Most

of these regimes have been far more cautious in their expression of concern

about Moscow's approach and even have sought to make the best deals they can

with President-elect Vladimir Putin.


But the Ioshkar-Ola meeting and especially its decision to resuscitate the

emotionally powerful term Idel-Ural nonetheless contain messages to three key


First, its call for the establishment of Idel-Ural serves notice to the

governments in this region that their populations may be far more radical

than are the officials.

On the one hand, the decision at the Ioshkar-Ola meeting may radicalize these

regimes, leading them to take a tougher stand against Moscow in the

expectation that such a move will win them support. And on the other hand, it

may cause them to become more dependent on Moscow, thereby reducing their

authority and making authoritarianism and instability more likely in the



Second, the Ioshkar-Ola meeting calls into question the assumptions of those

in the Russian government who believe they can either attack Islamic groups

with impunity or coopt the majority of them.


The Russian government has used anti-Islamic rhetoric during its Chechen

campaign that has offended even those Muslims within the Russian Federation

who agreed with Moscow's overall approach in Chechnya.


But more important, the decisions at Ioshkar-Ola suggest that Moscow will not

be able to coopt the so-called "moderate Russian Muslims" as he and his aides

have suggested. The Tatars who have been celebrated for their "moderation" in

dealings with Moscow are clearly sending a message that Moscow's current

approach may leave them moderate no more.


And third, the Ioshkar-Ola decisions also call into question the assumptions

of many Western governments that Putin's presidency is likely to lead to more

stability, even at the cost of increasing authoritarianism.

In fact, moves by Putin thus far may generate their own nemesis just as

Soviet leader Mikhail Gorbachev's moves to recoup Moscow's power in 1990-91

led even those who had never thought about secession to decide to move in

that direction.


The Ioshkar-Ola meeting is likely to mark yet another turning point in the

development of the post-Soviet space, one that could trigger precisely the

kind of instability that leaders there and elsewhere say they want to avoid.





Irish Times

3 May 2000






It was not unlike the beginning of a spy novel. In the course of the St

Patrick's Society's Emerald Ball in one of Moscow's plusher hotels a young

man called Yuri approached me. 'A group of people will meet,' he told me, 'at

6.30 on Sunday at the centre of the circle-line hall in Taganskaya metro

station. You will find it interesting for your newspaper.'


Getting there was no problem. Taganskaya used to be my local metro station.

The circle-line hall I remembered was adorned with porcelain busts of

soldiers from the old Red Army. Under each bust was a suitable exhortation:

'Glory to the heroes of the Parachute division,' 'Glory to the heroes of the

Artillery' or 'Glory to the heroes of the Red Cavalry,' as the case might be.


Nothing had changed. In a small knot of people, I recognised Yuri. We waited

until the group numbered more than a dozen and then set off through what was

once, for me, familiar territory. We passed down Goncharny Lane where the

guild of potters once had its headquarters.


On the left loomed a vast apartment block from the Stalin era, on the right

the little 17th century Church of the Assumption at the Potters, with golden

stars glistening on its blue onion domes. A small group of the faithful stood

in front of its celebrated icon of the Virgin with Three Hands in its glass

case on the west wall.


Dusk was falling rapidly. We entered a maze of tiny lanes and courtyards of

which I had no previous knowledge. The journey was downhill, and towards its

end I got my bearings from a short-lived glimpse of the Kettlemakers

Embankment at the Moskva River. Things began to happen quickly. We reached a

low door in a hidden corner of a courtyard. It opened automatically on our

arrival. A flight of stairs led down to a basement room in which desks were

set out in classroom format. The group seated itself quickly. A young woman

appeared at the blackboard and addressed the group briefly in Russian.


She took a piece of chalk in her hand and wrote 'Ceacht a cuig'. Then, in

Russian again, she asked the class to intone the golden rule of spelling:

'Leathan le leathan agus caol le caol,' came the chorus in reply.


I had started on a journey during which, for instance, I would become

acquainted with a young Don Cossack who plays the bodhran and has changed his

name from Sergei Marchukov to Master O'Toole.


The bug of celtomania has bitten hard in Moscow, but nowhere harder than in

the Irish classes given by Anna Alexandrovna Korostolyova. Each Sunday

evening the students are put through two strenuous hours with the Christian

Brothers, grammar and Urchursa Ghaeilge as the main text books. All of them

are in their 20s; two thirds are women.


Anna, the teacher, is a graduate of the Philology department of Moscow State

University where there is a thriving Celtic department. Last autumn she

studied in Trinity College Dublin under Prof Eoin Mac Carthaigh and spent

some time in the Gaeltacht at Ventry in Co Kerry.


Her students came to the Irish language by various routes. One young woman

called Katya had been impressed by Scarlet O'Hara in Gone with the Wind.

Isabel, a Spaniard who had been living in Russia for five years, was learning

the language in order to have one up on her friends in Ireland where,

paradoxically, she had learned English. It was Andrei, however, who spoke for

the majority when he explained his interest in the language had grown out of

the music. 'The Irish people are the most powerful suppliers of ethnic music

in the world and language is always linked to music'.


For me the link between the music and the language was Yuri, the man who

started me off on my journey. Yuri Andreichuk plays the Uzbek doira, an

instrument indistinguishable from the bodhran, in Slua Si, Moscow's most

popular traditional Irish group. It all started, he told me, back in the

1980s with a group called Puck and Piper. After that, the 'traditionalists'

and the 'progressive' adherents of Celtic Rock went their separate



Slua Si, or Voinstvo Sidov, as they style themselves in Russian, is now the

foremost group among the traditionalists, and its equivalent on the

progressive side is Sidhe Mhor. I caught up with the progressives in a club

across the river from the Kremlin called Vermel which in its promotional

literature boasts the most stunning view in all Moscow. In fact, it occupies

a totally windowless cellar. Here the young people dance to souped-up reels

and hornpipes with their hands placed firmly behind their backs. Vladimir

Lazerson, who plays the Scottish warpipes, was overwhelmed when he heard I

was from Ireland. 'You come,' he told me, 'from the country of the world's

greatest entertainer . . . Christy Moore.'


Four members of Slua Si gathered for interview at Silver's Irish Pub at the

bottom of Tverskaya Street, about 250 metres from Red Square. Yuri Andreichuk

had brought his doira. He also spoke of his role as a seanchai, telling Irish

stories in Russian on the very popular Ekho Moskvy radio station as well as

his role as the group's manager and its main vocalist. As a graduate of the

Celtic section of Moscow State University's philology department, he does a

neat version of An bhfaca tu mo Sheamaisin.


Alexei Bachurin explained that he had been playing the violin since he was

five and spoke with some knowledge of traditional musicians Michael Coleman

and James Morrison. He now prefers the Kerry style.


Perhaps the most distinguished member of the group is Anatoly Isaev, a

professional musician with the orchestra of Russia's Pyatnitsky Choir. He

plays the whistle and the Scottish pipes but is best known as a flute-player

of real distinction. The 'traverso' flute he uses in the group was made for

him by one of Russia's most celebrated instrument makers, Fyodor Nekrasov.


As often happens in situations like this, the interview faded into the

background and the musicians began to play. Anatoly Isayev gave a soulful

solo rendition of the slow air, Cailin na Gruaige Doinne. an.


The Russians in the pub applauded strongly after every round of tunes. But it

all came to an abrupt end when, at the request of a group of young Irish

expatriates, the traditional music was drowned by blaring hip-hop from the

pub's sound system. Pointing disdainfully at Slua Si, one of the Irish lads

said: 'We came here to Russia to get away from all that.'





Yabloko's St. Petersburg Ambitions Viewed

Rossiyskaya Gazeta

28 April 2000

[translation for personal use only]

Article by Dmitriy Reytblat: "One Beaten Man Can Be Used To Beat Another"


Unity does not want to be called the "party of

power," but it is not averse to being called the ruling party. No

matter what Yabloko leader Yavlinskiy may say, everyone understands that

Yabloko is trying to occupy the main position against the party of power

(sorry, the ruling party) - and become its eternal "counterbalance."

That is the only path of development for such parties and movements,

which were created to feed off the mistakes of the powers that be.


Having "lost" Yeltsin, the Yabloko movement at first also lost the

point of its existence. The opposition movement was geared to him,

having gathered under its banners quite a large number of people who were

displeased with the authorities. Putin's arrival threw Yavlinskiy into

confusion. All the main "cast-iron arguments" against the authorities

were lost. Maybe the voters have decided, albeit not very consciously,

to trust the new authorities in advance, and Yabloko, deprived of their

support, has been left with nothing. Yabloko is faced with the urgent

task of determining whom they will "oppose" from now on.


The gubernatorial election in St. Petersburg is the first signal

heralding the idea that Yabloko appears to have found a new target to

work on. Nominating its candidate for the gubernatorial post in as

dramatic and sensational a way as possible has been of fundamental

importance for Yabloko. An election in Russia's second most important

and influential city means revenge for previous public humiliations in

the Duma elections and the presidential election. But it is far more

important for Yabloko in the prevailing situation to establish a

bridgehead in St. Petersburg for opposing the current authorities. To

"shine" in the native city of the president, who supports the present

governor, means to begin a new confrontation between the authorities and

the liberal democrats. Which in fact is necessary for the democrats to

be able to rise from the ashes. Having obtained an objective for

political trading, Yabloko can in real terms influence Putin and his



But to start off with, you have to win the actual main battle --

literally "win" St. Petersburg. Without this trophy, the undertaking in

many respects becomes pointless. St. Petersburg is not one of many, it

is a bonanza of political and financial opportunities. You can only

build the edifice of anti-Putin opposition on such a mighty foundation.

Yabloko understands this and is operating very energetically. Yabloko

member Artemyev's election campaign is being conducted in an aggressive

and tough manner, and most sensational and dirty political advertising is

being added to the arsenal. The "anti-Yakovlev youth coalition," born

within the democratic camp, is stirring up the St. Petersburgers with

public "dancing on Yakovlev's bones." The democratic publication called

"My Capital" has been shocking the St. Petersburg intelligentsia with its

pornographic caricatures, publishing on its pages an image of a stylized

Russian eagle (and simultaneously the governor) with enormous genitals.

These are the "liberal techniques" that are being foisted upon the

cultural capital of Russia and the democratic intelligentsia by Yabloko!


Another innovation for the Russian political scene, tested out a long

time ago in the West, is conducting preliminary elections (primaries).

Since only "democratic" candidates are on the lists at these primaries,

and a Yabloko member is in the lead, this measure should first and

foremost "highlight" Artemyev against the favorable backdrop of weaker

democratic rivals. Another ploy is to declare right now the idea of

unifying all the democratic forces (first and foremost Yabloko and the

Union of Right-Wing Forces [SPS]). At the moment Yabloko's usual

uncooperativeness is extremely disadvantageous to it -- voters are sick

to death of the internecine squabbles in the democratic camp, and

Yavlinskiy wants to show that he is sometimes prepared to listen to

someone else's opinion for the sake of a big cause.


Meanwhile, there is very little time left: Strong methods of some

kind are required to wrest votes from the democratic brethren in the

remaining time. Yabloko's backup man Shelishch has already withdrawn

his candidacy and SPS candidate Rybakov is going to withdraw his

candidacy in Artemyev's favor, but that is not enough. The idea is that

Yabloko will now go for broke and think up something extraordinary.

Otherwise the whole undertaking of forming a bastion of anti-Putin

opposition in the city on the Neva will come tumbling down and bury the

remains of Yabloko.






United Nations Economic Commission for Europe

Spring Seminar, 2 May 2000

"From Plan to Market: the transition process after ten years"



By Michael Ellman

Professor of Economics, Faculty of Economics and Econometrics, Amsterdam



1. Introduction


In the decade 1989-1999 the Soviet empire collapsed, a number of states in

central and eastern Europe disintegrated and new ones were formed, and the

political-economic system throughout the region was transformed. During

this transformation there have been sweeping social changes, frequently for

the worse. The purpose of this paper is to survey these adverse phenomena,

to the extent that the available data makes this possible, paying

particular attention to the question of whether they were caused by the

transformation, or by other factors, and whether existing accounts of these

phenomena offer a fair picture. The main issues considered are: What were

the costs? Who paid them? Why has there been so little political protest?

How does the present system change in the region compare with the previous




4. Why has there been so little political protest?


Given the magnitude of the social costs of the transformation, one might

have expected widespread political protest, with riots, strikes, political

upheavals and economic policy reversals commonplace. In fact, with the

exception of Albania in 1997, popular upheavals have been conspicuous by

their absence. This in spite of the fact that the neoliberals have

frequently warned of the populist dangers, and their opponents have

frequently warned of the political dangers of the neoliberal policies.

What explains this stability?


This question has been investigated by Greskovits. He stressed certain

structural legacies of the old regime (absence of large inequalities, the

initial absence of significant long-term poverty, provision of welfare

services, absence of large shantytowns, compromised trade unions, tradition

of cooperation between trade unions and management) which distinguished the

situation in eastern Europe from that in Latin America. He also pointed to

the structural and instititional consequences of the implemented neoliberal

measures, such as the growth in unemployment, the decline in union

membership, the growth of the private sector, the increase in employment

insecurity, and the opportunity to protest by voting the government out,

which have all contributed to political stability.


Greskovits also drew attention to the fact that an important reason for

political stability is that neoliberalism has enhanced the possibilities

for, and the gains from, expressing discontent by means of æexitÆ rather

than ævoiceÆ (to use HirschmanÆs well- known distinction). The two main

means of exit have been informalization, that is earning money in the

informal sector, and emigration. In many countries the informal sector is

large and provides an important part of the answer to the question as to

why policies which have had such adverse effects on activities in the

formal sector have given rise to such little organized opposition.

Similarly, emigration is important throughout the region.


Both informalization and emigration can be considered economic pathologies

resulting from the policies pursued. Informalization reduces fiscal income

and undermines the financing of public services (and in the form of

subsistence agriculture and petty retail trade is very inefficient).

Emigration leads to the loss of large numbers of young, and often well

qualified, potential workers. On the other hand, where informalization

generates incomes that could not be generated in the formal sector (because

of the grabbing hand, taxes, or inadequate incomes) it must be considered a

positive phenomenon. Similarly, remittances from emigrants (as in Albania)

or the return to their home country of those who have temporarily worked

abroad, as in the Baltic states and Poland, can be a useful addition to a

countryÆs human capital. Furthermore, emigration may benefit the migrants

themselves, even if it represents a loss for the their country of origin.


Other factors strengthening the political viability of the measures adopted

have been their international support (from the international financial

institutions, the EU, and the international business community) and the

gains from them to the elite (opportunities for looting, increased

consumption, acquisition of overseas assets).


Greskovits concluded that eastern Europe exhibits a low-level equilibrium,

with incomplete democracy and an imperfect market economy, and this is

likely to be quite stable. While not a first best solution, it is viable

and is a second best one.


In addition, there is an important factor not considered by Greskovits.

The transformation has brought not only social costs but also social

benefits. For example, the increased availability and variety of consumer

goods resulting from price and trade liberalization has had many positive

consequences. These range from the reduction in unwanted pregnancies

resulting from the increased availability of contraceptives (most of which

are imported), via the increased mobility resulting from the spread of car

ownership (except in those capital cities where increased congestion has

led to a decline in average speeds), to the cultural, recreational and

economic (shuttle trade) benefits from increased foreign travel.

Furthermore, the interest and variety of the media has frequently

increased. Moreover, the possibilities for legal self-employment and

entrepreneurship have greatly increased and have been seized by millions of

people. In addition, the political changes have brought many social

benefits, ranging from independent trade unions, schools/universities and

churches, to the greater freedom of nations which formerly lived under an

imposed and unwelcome political-social-economic system. These social

gains, and their positive evaluations by the populations concerned (or at

any rate those within them that have benefited from them) are also part of

the explanation of the lack of political protests.


5. How does the present system change compare with the previous one?


a) The collapse of the Russian empire and the transition to socialism:

Russia 1917-22


It is important to realise that the current transformation in eastern

Europe is not an ordinary type of economic policy but a change of the

socio-politico-economic system. This means that when thinking about its

costs, it is appropriate to compare it not with, for example, conventional

macroeconomic policies in OECD countries, but with the previous system

change in the area. For the CIS countries, that was the collapse of the

Russian Empire and the transition to socialism in 1917-1922, in the three

Baltic countries the expansion of the Soviet empire and the transition to

socialism in 1940-1941 and 1944-1949, and in the rest of the former eastern

Europe the expansion of the Soviet empire and transition to socialism in

1945-1949. These systemic changes were also marked by substantial social

costs. In the former Russian empire there was a long and bloody civil war,

a variety of national wars (Finland, Poland, the Baltic and Central Asia),

a major famine (in 1917-22, first in Central Asia, then in the Russian

cities, and then along the Volga) and substantial emigration. In 1918-22,

civil war, disease and famine seem to have caused about 12.5 million excess

deaths. Emigration seems to have been about another 2-3.5 million. These

events constituted a demographic disaster (although less than that of World

War II). In this period there was also a huge decline in output and

hyperinflation. Writing about the 1990s in ôthe former Soviet blocö, a

recent UNDP report argued that: ôThe extent of the collapse in output and

the skyrocketing nature of inflation have been historically unprecedented.ö

This erroneous statement shows a complete ignorance of what happened

during the previous system change in the FSU area.


b) The expansion of the Soviet empire and the transition to socialism:

eastern Europe 1945-49


The number of victims of the expansion of the Soviet empire and transition

to socialism in eastern Europe was much smaller than those of the collapse

and system change in the former Russian empire, but not insignificant. The

small-scale civil war in Poland in 1944-1947 seems to have cost about

20,000 lives. The deportation of Ukrainians from south-east Poland to the

former German territories seems to have involved about 140,000 people. On

the other hand, in the second half of 1952, at the height of Stalinism,

there were only (according to official statistics) 49,500 political

prisoners in Poland. The number of political prisoners seems to have been

greater in Czechoslovakia, despite its smaller population.


The largest social cost of this period was probably the expulsion and

flight of Germans from Poland, Czechoslovakia, Hungary and Yugoslavia,

which seem to have involved about 9.5 million people. This major social

cost can perhaps be treated more as a cost of World War II than of the

change in the socio-political-economic system in the countries concerned.


6. Conclusions


(1) The transformation was a change of system that had serious adverse

social consequences for much of the population. These consequences,

however, were in general less than the costs of previous change of system

in the region.


(2) These consequences included widespread impoverishment, a decline in

employment, growth in unemployment, increased inequality, decline in

publicly provided services, social exclusion, and in some countries a

worsening of the health of the population.


(3) Some of the negative social phenomena observed during the

transformation, and sometimes ascribed to the transformation, were not in

fact caused by it. For example, although there were almost six million

missing Russian men in 1994, it is not true that this was a consequence of

transformation. Nor is it true that transformation directly followed a

period of successful economic policy during which living standards rose.


(4) In Russia there was a sharp increase in mortality in 1988-1994 and in

1999, and there were analogous developments in other CIS countries (e.g.

Kazakhstan). The main proximate causes of the increase in mortality in

Russia in 1988-1994 seems to have been an increase in alcohol consumption

and in stress. The main ultimate causes of the increases in Russian

mortality seem to have been state collapse and state failure. The high

levels of mortality in some CIS countries, notably Russia and Kazakhstan,

which particularly affect adult males, are major socio-economic problems

for those countries.


(5) It is not true that the declining population of Russia and some other

countries are a sign that they are the victims of genocide. Some EU

countries (Italy, Germany, Sweden) also have an excess of deaths over

births. The long-term decline in the birthrate throughout Europe is a

result of deep-rooted pan-European social trends. On the other hand, some

sharp short-term fluctuations, such as the dramatic decline in the

birthrate in the former GDR in the early 1990s, clearly did result from the

transformation. The high level of mortality in Russia did worsen during

the transformation, but the break with pan-European trends goes back to the

mid 1960s.


(6) The transformation has led to the growth of a variety of socio-economic

pathologies, such as corruption, criminalization, informalization,

alcoholism, and tobacco and drug addiction.


(7) There are sharp differences between transformation countries. Whereas

some are already (with respect to such indicators as health and corruption

levels) Europeanized, others lag a long way behind EU levels. In place of

the former homogenous socialist camp, a sharp polarization has developed

between countries. Unfortunately, the majority of the population of the

region live in the relatively unsuccessful countries.


(8) The absence of widespread political opposition to neoliberal policies

is not necessarily a sign that these policies have widespread support. It

is partly a sign that the inheritance from the old regime, and the

structural and institutional consequences of the measures adopted,

particularly the enhanced opportunities for exit, together with the

international support for the measures, and the gains to the elite from

them, have combined to make them feasible, and for some people attractive,

despite their social costs.


(9) The transformation has brought not only social costs but also many

social benefits (such as easier access to modern contraception, increased

foreign travel, more interesting media, greater possibilities for legal

self-employment and entrepreneurship, in some cases a reduction in national

oppression, etc).


In the twentieth century the unfortunate people of the CIS were the victims

of two imperial collapses and two abortive transitions (to an attractive

socialism and to a civilized market economy) separated by only about

seventy years.






US State Department

02 May 2000

Text: Patterns of Global Terrorism 1999 -- Eurasia Overview

(State Department issues annual report May 1) (1,830)


Following is the text of the Eurasia Overview of the State

Department's "Patterns of Global Terrorism: 1999" report:


(begin text)





[Armenia, Azerbaijan, Georgia, Kyrgyzstan, Russia, Tajikistan,



Five gunmen attacked Armenia's Parliament in October, killing eight

members, including the Prime Minister and National Assembly Speaker.

Later in the year a grenade was thrown at the Russian Embassy,

damaging several cars but causing no injuries.


A major Central Asian regional crisis erupted in Kyrgyzstan when

members of the Islamic Movement of Uzbekistan (IMU) twice crossed the

border from Tajikistan and took hostages. Among the several dozen

hostages taken in the second incident were four Japanese geologists,

who eventually were released after several nations intervened; ransom

was rumored to have been paid.


Russian cities, including Moscow, were subjected to several bomb

attacks, which killed and injured hundreds of persons. Police accused

the attackers of belonging to Chechen and Dagestan insurgent groups

with ties to Usama Bin Ladin and foreign mujahidin but presented no

evidence linking Chechen separatists to the bombings. The attacks

prompted Russia to send military forces into Chechnya to eliminate

"foreign terrorists." Neighboring Caucasus states within the Russian

Federation as well as surrounding countries feared Russia's military

campaign in Chechnya would increase radicalization of Islamic internal

populations and encourage violence and the spread of instability

throughout the region. The Russian campaign into Chechnya also raised

fears in Azerbaijan and Georgia, as well as Russia, that the Chechen

insurgents increasingly would use those countries for financial and

logistic support.


Uzbekistan experienced several major attacks by IMU insurgents seeking

to overthrow the government. In February five coordinated car bombs

exploded, killing 16 persons, in what the government labeled an

attempt on the President's life. In September the IMU declared a jihad

against the Uzbekistani Government. In November the IMU was blamed for

a violent encounter outside the capital city of Tashkent that killed

10 Uzbekistani Government officials and 15 insurgents....




In the fall a series of bombings in Russian cities claimed hundreds of

victims and raised concern about terrorism in the Russian Federation.

On 4 September a truck bomb exploded in front of an apartment complex

at a Russian military base in Buynaksk, Dagestan, killing 62 persons

and wounding 174. Authorities discovered a second bomb on the base the

same day and disarmed it before it caused further casualties. On 8 and

13 September powerful explosions demolished two Moscow apartment

buildings, killing more than 200 persons and wounding 200 others. The

two Moscow incidents were similar, with explosive materials placed in

rented facilities on the ground floor of each building and detonated

by timing devices in the early morning. The string of bomb attacks

continued when a car bomb exploded in the southern Russian city of

Volgodonsk on 16 September, killing 17 persons and wounding more than

500 others.


A caller to Russian authorities claimed responsibility for the Moscow

bombings on behalf of the previously unknown "Dagestan Liberation

Army," but no claims were made for the incidents in Buynaksk and

Volgodonsk. Russian police suspected insurgent groups from Chechnya

and Dagestan conducted the bombings at the behest of Chechen rebel

leader Shamil Basayev and the mujahidin leader known as Ibn

al-Khattab, although Russian authorities did not release evidence to

confirm their suspicions. Russian authorities arrested eight

individuals and issued warrants for nine others believed to be hiding

in Chechnya but presented no evidence linking Chechen separatists to

the bombings.


In response to the apartment building bombings and to an armed

incursion by Basayev and Khattab into Dagestan from Chechnya, Russian

troops entered Chechnya in October in a campaign to eliminate "foreign

terrorists" from the North Caucasus. The forces fighting the Russian

army were mostly ethnic Chechens and supporters from other regions of

Russia. They received some support from foreign mujahidin with

extensive links to Middle Eastern, South Asian, and Central Asian

Islamist extremists, as well as to Usama Bin Ladin. At yearend,

Chechen militant activity had been localized in the North Caucasus

region, but Russia and Chechnya's neighboring states feared increased

radicalization of Islamist populations would encourage violence and

spread instability elsewhere in Russia and beyond.


There were few violent political acts against the United States in

Russia during the year. Anti-NATO sentiment during the Kosovo campaign

sparked an attack on the US Embassy in Moscow in late March when a

protester unsuccessfully attempted to launch a rocket-propelled

grenade (RPG) at the facility. The perpetrator sprayed the front of

the building with machinegun fire after he failed to launch the RPG.

At yearend no progress had been made in identifying or apprehending

the assailant.




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