July 7th, 2000    
This Date's Issues: 4389 •   •

Johnson's Russia List
#4388
6 July 2000
davidjohnson@erols.com

[Note from David Johnson:
1. Itar-Tass: PUTIN SPEAKING OF RUSSIA'S KEY PROBLEMS IN INTERVIEW.
2. The Times (UK): Alice Lagnado, Putin's tactics ring alarm bells 
in West.
3. The Times (UK) editorial: THE RED LINE. Putin's press crackdown 
threatens relations with the West.
4. Moscow Times editorial: Berezovsky’s ORT Talk a PR Stunt.
5. THE DAILY YOMIURI (Japan): Alexander Tsypko, PUTIN UNLIKELY TO 
FIRE PREMIER YET.
6. Wall Street Journal: Roy Hofheinz, Putin's Critics Fear Russia 
Resembles Pinochet's Chile.
7. Reuters: Hawkish Russian general says seeks good NATO ties.
8. St. Petersburg Times EDITORIAL: FSB Pushing Regressive National 
Idea.
9. Moscow Times: Ana Uzelac, Paper Says Luzhkov May Soon Lose Job.
10. Reuters: Summers-Russia economy improving, challenges ahead.
11. Boston Globe: David Filipov, Kidnappers thrive on chaos in 
Chechnya.] 

******

#1
PUTIN SPEAKING OF RUSSIA'S KEY PROBLEMS IN INTERVIEW
ITAR-TASS 

Paris, 6th July: The main tasks facing the Russian authorities are the
struggle against poverty and against corruption, Russian President Vladimir
Putin said in an interview with Marek Halter, French writer and publicist,
which was published by the 'Paris Match' weekly on Thursday. 

All the actions of the president and the government are aimed at attaining
those goals, Putin stressed. In his opinion, "the authorities cannot fight
corruption without developing the democratic institutions of civil
society". He included in them freedom of the press, freedom of creed,
stability of political parties and movements, respect for the principle of
the division of authority and the development of the judicial system. 

So far as the struggle against poverty is concerned, it envisages the
development of institutions of the market-based economy. "To take things
away from the rich and to distribute them among the poor would be the worst
of solutions," the Russian president stressed. He is positive that the
Russian authorities "should consolidate the principle of inviolability of
property, should make all proprietors, big and small, feel that they will
not only preserve their property, but also will be able to further increase
it, to use it and to freely manage it on the whole of the Russian territory". 

Putin is sure that "the centralisation of power and democracy are not the
two concepts contradicting each other". 

Speaking about the situation in Chechnya, the Russian president stressed
that in Chechnya Russia was fighting against "a regular terrorist
international". According to Putin, "Chechnya has been turned into a base
for attacking Russia". "We are facing today the formation of fundamentalist
international, which creates instability on the territory from the
Philippines to Kosovo," the Russian leader said. 

"It would be a serious mistake to suppress the striving of part of the
Chechen nation for autonomy, especially in view of the fact that modern
society has at its disposal various ways to resolve the problem," he
continued. Putin expressed confidence that they would reach agreement with
Chechens. 

Putin touched upon the problem of relationship between the Vatican and the
Orthodox Church. In his opinion, reconciliation of the Vatican and the
Orthodox Church is an urgent necessity. Responding to the question of the
French publicist on whether or not he invited the Pope of Rome to visit
Moscow, the Russian president said: "Yes, I did. But if the Pope comes to
Moscow and does not meet the Patriarch, there will be a scandal. And we do
not want a visit against the background of a scandal. This will not bring
our stands closer together. The Pope is a clever man. He understands all
that perfectly well." According to Putin, he discussed with the Pope, among
other things, some problems connected with religion and Moslem extremism. 

******

#2
The Times (UK)
6 July 2000
[for personal use only]
Putin's tactics ring alarm bells in West
FROM ALICE LAGNADO IN MOSCOW

SIX months after he came to power promising to bring leadership and reform to 
Russia, President Putin is becoming known for his autocratic rule: above all, 
for his attacks on press freedom. 

In the latest example of the the authorities' crackdown on their critics, 
Andrei Babitsky, the reporter detained in a camp in Chechnya in January, was 
banned from travelling to Bucharest today to receive a prize for his 
reporting. Instead of the award, he faces charges of carrying false documents 
and fines of £700. Many believe his crime was simply his critical coverage of 
the war. 

The move against him coincided this week with the fourth interrogation of 
Vladimir Gusinsky, the chairman of Media-Most, Russia's only independent 
media empire. Mr Gusinsky was arrested and briefly imprisoned in mid-June on 
charges of defrauding the Government of £7 million. 

The charges against both men have been ridiculed by journalists, politicians 
and commentators, who have called the Gusinsky case the most substantial 
attack on the media by Mr Putin since he became Prime Minister last year. 
They also argue that the attacks are simply the latest in a series of 
authoritarian measures about which the West has been too forgiving. 

Russian liberals have warned the West that its softly-softly approach to Mr 
Putin's intimidation of journalists is even counter-productive because it is 
interpreted by the Kremlin as a blank cheque to harass its critics. Igor 
Malashenko, a senior executive in Mr Gusinsky's holding company who was 
himself detained last month, said that the West's lack of forceful criticism 
of Mr Putin had sent the wrong message to the Kremlin. 

"Appeasement does not work," he said. "Mr Blair's meeting with Putin created 
the misconception for Putin that he will be admitted into the exclusive club 
of Western leaders.Western leaders should be much more direct in dealing with 
Mr Putin." Tougher criticism would not isolate Russia but rather it would 
have an important influence on the new Russian regime. Instead, there was an 
over-confident mood among the President's men, he said. "People in the 
Kremlin think they can do anything they want about Chechnya or anything 
else," he said. 

Sergei Kovalyov, Russia's veteran human rights campaigner, said it was simply 
easier for Western governments to pretend things were fine in Russia. "They 
don't want to examine things properly. That is exactly what the Putin team is 
counting on," he said. 

Mr Kovalyov said that the Russian Government could go on harassing the press 
in myriad ways without having to resort to the psychiatric hospitals or 
labour camps employed by the Soviet regime. "No gulag is needed because 
inside every Soviet person there is a prison guard, and that is much more 
effective than an actual prison." 

Even Sergei Dorenko, a prominent journalist widely perceived as a Kremlin 
supporter, has condemned the President's clampdown. He said: "It's hard for 
foreign and Russian investors to understand what is happening here. On the 
one hand, we seem to be in favour of investment, but on the other, democracy 
is being replaced by what even cautious critics are calling elements of a 
police state." 

Critics of the West's handling of Mr Putin point to a lengthening list of 
decisions indicating that his instincts for control, honed during his KGB 
years, have come to the fore. The Security Council, an unelected body 
dominated by figures from the intelligence services, will run the country if 
a state of emergency is declared, according to a new law soon to be passed by 
parliament. In adddition, Gazprom, the natural gas giant which is the 
country's biggest company, is now de facto under Mr Putin's control. 

Mr Putin has also just pushed through a law enabling him to dismiss elected 
regional governors, further tightening central control of the country. 
Further, he has not introduced the promised legislation to implement wide 
reforms in Russia, for instance of the judicial system, which largely acts in 
the interests of the rich and powerful. 

Until now, Mr Putin has enjoyed the comfort of economic stability because of 
high oil prices and the rouble devaluation in 1998. But he said this week 
that inflation would rise sharply, to 2.5 per cent, this month and the 
effects of devaluation are wearing off. Now the oil price is falling. 
Observers are worried about how he will act if the economy takes a nosedive. 

Disquiet about his repressive tendencies has reopened the debate in the West 
about how best to deal with his leadership. Although Mr Blair and President 
Clinton have sought to establish good working relations with the new Kremlin, 
on the assumption that he will be running Russia for the next decade, there 
are lingering doubts in other Western capitals about him and his failure to 
get to grips with the priorities facing his country. 

One British source, who has watched the Putin Kremlin closely, said: "There 
were great expectations when he came to office and the shine has worn off. 
Threats against press freedoms are disturbing. Equally, where is the 
programme for reform we heard so much about earlier?" 

There is a palpable sense of drift, with Russians not clear sometimes if the 
Government or the Security Council is actually running the country. 

In the West, there are some signs of a reassessment. Francis Maude, the 
Shadow Foreign Secretary, called on the British Government yesterday to 
readjust its policy towards Moscow. 

"Mr Blair's hasty embrace of Vladimir Putin owed everything to competitive 
opportunism and nothing to balanced judgment," he said. "We need close 
relations with powerful but unstable states such as Russia and China, but we 
don't need to check in our values at the check-out desk when we visit them. 
They won't respect us if we do." 

How the West deals with Russia in the future may well depend on who is 
elected the next American President. A victory by George W. Bush, the Texas 
Governor and Republican candidate, would usher in a far more hawkish 
Administration. 

******

#3
The Times (UK)
6 July 2000
[for personal use only]
Editorial
THE RED LINE
Putin's press crackdown threatens relations with the West 

Tony Blair took a calculated risk in flying to St Petersburg to forge a 
special relationship with Vladimir Putin. As the architect of Moscow's brutal 
crackdown in Chechnya, the new Russian leader was hardly the person to 
exemplify Labour's ethical foreign policy. His KGB past had already raised 
fears inside Russia and beyond that he would bring back the bad old days of 
Soviet repression. And his belligerent promise to bolster the armed forces 
and crack down on crime were seen in the West as an ominous indication that 
he cared little for democratic procedure. 

Mr Blair's argument was that Mr Putin, new to politics and impatient for 
change, was genuine in wanting outside investment, better relations with the 
West and an end to the domestic lawlessness that had overtaken Yeltsin's 
Russia. It was therefore in the West's interest to do business with him - 
even if this meant turning a blind eye to some of the rougher methods some 
aides proposed for getting control of the country. The Prime Minister made 
clear his concerns over Chechnya and press freedom, especially the case of 
Andrei Babitsky, the Radio Liberty reporter who was arrested in Chechnya and 
held for a month without any announcement of his whereabouts. Mr Blair must 
have hoped that these warnings would still carry weight once Mr Putin was 
inaugurated. 

He was sadly mistaken. Mr Putin has continued and intensified a crackdown on 
the press. He has brought into his admin- istration former KGB colleagues who 
have brought back some of the arbitrariness, high-handedness and fear that 
typified Soviet power. He has used his support in the Duma to bypass the 
regional governors, introduce a new "information doctrine" and, most 
worryingly, approve a first reading of a new law giving the head of state the 
right to close down political parties and introduce a state of emergency at 
will. In seeking better relations with the West, Mr Putin has reached out on 
arms control, investment policies and greater co-operation in the Balkans. He 
is apparently committed to continued economic reform. But other policies are 
going to make it difficult for the West to embrace him as a partner who 
upholds the values fundamental to free societies. 

There is a cynical argument that Mr Putin is only responding to the yearning 
within Russia for order. It has also been argued that only by stamping his 
firm and early authority on Russia can he take on the entrenched and often 
corrupt interests that flourished under Yeltsin. The freewheeling governors 
had to be reined in. And the so-called oligarchs' power to flout the laws, 
ignore tax demands and create monopolies that enriched the few and im- 
poverished the many was the most hated aspect of "Western" economic reform. 

Mr Putin, as expected, has moved to curb both. But the main worry is that in 
doing so he has signalled a contempt for dem- ocratic procedure that bodes 
ill for the hard-won freedoms that marked Russia's emergence from communist 
dictatorship. Of these, press freedom is the most endangered. A healthy and 
vigorous press was Yeltsin's proudest legacy, the best guarantee of 
democratic pluralism. The treatment of Mr Babitsky, who was yesterday charged 
with carrying false documents, and the recent imprisonment of Vladimir 
Gusinsky, owner of the main independent television station, are blatant 
attempts at intimidation. 

Press freedom is a red line that the Kremlin must not cross if it is to enjoy 
the Western backing that Mr Putin seeks. Not only Mr Blair has been deceived; 
millions of Russians are growing fearful of what more may come. 

******

#4
Moscow Times
6 July 2000
Editorial 
Berezovsky’s ORT Talk a PR Stunt

Boris Berezovsky says he has half a mind to return his 49 percent stake in
ORT television to the state. Not, of course, forever. Only "in trust." 

Why? Berezovsky says he thinks the state, which holds the remaining 51
percent of the nation’s No. 1 television station, should cough up more
budget money. "I don’t want to spend a lot of money on [ORT]," Berezovsky
explained this week in a Radio Liberty interview. "I have never received
economic profits from ORT. Political [profits]? Unlimited. Economic? None."

So in other words, Berezovsky wants the state to underwrite his political
profits. He wants to keep the station as his personal Ministry of Truth —
but he also wants the public to pay more for the privilege of being
manipulated.

On Berezovsky’s watch at ORT, his pet anchorman, Sergei Dorenko, has
advocated genocide in Chechnya while Kremlin opponents have been smeared
with outrageous propaganda, including unflattering associations with gays,
Jews and prostitutes. 

Those urging President Vladimir Putin to clean up the country might have
expected him to start with ORT. It’s privatization has always been murky:
We have no idea how Berezovsky came to control 49 percent of the station,
for example. (In fact, the Radio Liberty interview marks the first
confirmation we know of that Berezovsky actually controls the entire 49
percent that’s in private hands).

But of course, Putin was plucked from obscurity by the Yeltsin/Berezovsky
"family" and then elected on the back of ORT propaganda. Berezovsky has
said Putin always returns his calls and has touchingly recounted how Putin
came to the birthday party of Berezovsky’s wife to pay respects. Putin has
never challenged such claims. So only the most stubborn wishful thinkers
should have been surprised last month when Berezovsky easily installed his
allies — including his daughter — on the ORT board.

Now Berezovsky is again counting on the power of such wishful thinking. He
frankly offers the other reason he wants to loan the Kremlin back his 49
percent stake: "So that no one will be saying, ‘What has Dorenko said
there? Did Berezovsky prompt him to this? — I don’t want to explain
anything to anyone anymore. Let [Kremlin Chief of Staff Alexander] Voloshin
explain."

This is reminiscent of Berezovsky’s unwelcome takeover of Kommersant last
year: Within days, Kommersant was announcing fire inspectors had shut it
down, for a day, at Mayor Yury Luzhkov’s evil orders. Berezovsky is a
master of such PR stunts — turning his tools overnight into "embattled free
media." His next trick? To win more state money for ORT and revive its
credibility by making a public exit — if only for a while.

******

#5
THE YOMIURI SHIMBUN/DAILY YOMIURI
6 July 2000
PUTIN UNLIKELY TO FIRE PREMIER YET
Alexander Tsypko, Special to The Daily Yomiuri 
(Tsypko is a Moscow-based political analyst.) 

There are reasons to believe the Russian press is trying to start a fight
between President Vladimir Putin and Prime Minister Mikhail Kasyanov. 

Many newspapers in the country have been emphasizing that the prime
minister is acting alone in directing the government's economic strategy
and is blatantly ignoring the economic reforms program created by Economy
Minister German Gref, who is a close friend of Putin. 

It is widely known that Kasyanov used all his influence to try to prevent
Gref's nomination to the Cabinet, and it was only after the direct
intervention of the president that the creator of the liberal reforms
program was appointed to the post of economy minister. 

Recently, many leading newspapers, including MK, the most popular daily in
Moscow, have published long articles about Kasyanov's career, filled with
hints of his possible involvement in some shady deals. 

We are told that when Kasyanov was a senior official in the Finance
Ministry he ardently supported foreign loans for Russian businesspeople
that were guaranteed by the state. However, during the last two years about
two-thirds of businesspeople who received the loans have gone bankrupt and
the state has had to repay the foreign creditors. 

The anti-Kremlin media have dubbed Kasyanov "Misha 2 percent," hinting at
the amount of commission he is believed to have received for backing the
loans. The media repeatedly have drawn attention to the fact that Kasyanov
was born and bred in Solntsevo, the main base of the Moscow mafia. 

It is well known that when Kasyanov became the chief of the Finance
Ministry's foreign loans section he opposed the idea of making the
procedures involved in Russian foreign borrowing more transparent. For this
reason, the Russian public had almost no information about the country's
foreign debts for a long time. 

It is difficult to know who has been conducting the propaganda war against
the prime minister and whether the target is Kasyanov himself or "the
Family," comprising Yeltsin's daughter Tatiana Dyachenko and her cohorts,
who promoted both Kasyanov and Putin to the top government posts. Some
observers think that articles printed in newspapers and magazines that have
attempted to damage Kasyanov's reputation can be sourced to Putin's team,
which reportedly is riven by internal friction. 

It is wrong to think that Kasyanov has satisfied all the Russian
oligarchies in his capacity as premier. Notably, he has failed to become
part of Putin's closest circle, the so-called St. Petersburg group. 

The premier has found himself in a permanent state of conflict with Anatoly
Chubais, the oligarch who heads the St. Petersburg group, as well as with
Finance Minister Alexey Kudrin and Gref. 

It is highly likely that Chubais is providing money for the propaganda war
against Kasyanov. The problem of whose money is involved is not so
important. The crucial issue is how Putin will react to the pressure to
fire the prime minister. 

For Putin, Kasyanov is not an easy problem to solve. The two men are close
personal friends--Kasyanov being one of only a few people whom Putin allows
to call at his residence at any time. But despite this, it is obvious that
Putin cannot completely rely on the Cabinet chief. 

Kasyanov, along with Prosecutor General Vladimir Ustinov, is indebted for
his rise to power not to Putin, but to the Family. 

Alexander Mamut, a banker who is very close to former President Boris
Yeltsin, often tells the story of how he, Mamut, made Kasyanov who he is
today. 

In May 1999, at the request of Mamut and another Family member oligarch,
Roman Abramovich, Yeltsin forced newly appointed Prime Minister Sergei
Stepashin to reverse an earlier decision and hand the post of finance
minister to Kasyanov. 

Putin cannot ignore that one of the reasons for the Family's promotion of
Kasyanov for the premiership was to keep in check the president's possible
aspirations for more power. 

Of course, if Putin were to get rid of Kasyanov, he would significantly
lessen his dependence on the Family. If, for example, the president were to
make his friend Security Council Secretary Sergei Ivanov the new premier,
Putin immediately would have more potential to extend his power. That is
why the temptation to fire Kasyanov is great. 

In the near future, there will be plenty of reasons for Putin to make such
a move. I am not talking about compromising news articles that fail to make
waves in modern Russia--I am talking about the approach of an unavoidable
change for the worse in the Russian economy, for which the premier is
formally responsible. 

Since May, the government has been trying to cope with the growing problem
of delays in salary payment. It is obvious the budget is not in a fit
state. The government has no means to avoid the energy crisis that is
likely to occur in autumn. It is easy to predict that Chubais, head of
United Energetic Systems Corp., will do his best to make Kasyanov
responsible for the electricity shortage. 

In a way, Kasyanov has been held hostage by the comparatively rapid speed
of economic development, which started at the beginning of the year due to
high oil prices. However, according to many prominent economists, Russia's
economic growth will slow or even stop between autumn of 2000 and the
winter of 2001. In addition, if measures are not taken soon, the country
will face a grain crisis. 

Kasyanov has more than a few weak points. He understands only the narrow
sphere of negotiations with international financial organizations and is
unversed in the ins and outs of the budget compilation process. Kasyanov
recently lost a debate with Victor Geraschenko, the Russian Central Bank
chairman, over the principles of Russia's currency policy. 

In addition, Kasyanov's proposal to lower the Russian ruble rate to make
the country's exports more profitable was blocked by the central bank with
the help of Putin. 

It is also easy to prove that the agreement that the former Soviet Union
made with the London Club of creditors for the restructuring of foreign
debts--an agreement that was signed by Kasyanov--does not work in Russia's
favor. 

No doubt, if Putin wanted to, he could easily find reasons to fire
Kasyanov. However, in my opinion, the president is not interested in
getting rid of the prime minister for at least another six months. 

That does not mean that Putin has forgiven Kasyanov for his excessive
independence in formulating the government's economic strategy. Putin is
unforgiving and does not like it if anybody offends his friends. He surely
will not forget Kasyanov's contempt toward Gref. But for the moment, Putin,
as a pragmatist, sees no benefit in showing his anger. 

The reason is that Putin, who has his own ambitions, needs a weak and
vulnerable premier. If Putin wanted an experienced and popular prime
minister, he would have chosen Yevgeny Primakov, who headed the government
from September 1998 to May 1999. 

However, having a powerful leader in the premier's seat would create a sort
of dyarchy, which Putin would never allow. Putin does not want a balance of
power at the top. His philosophy of Russian leadership is based on the
concept of having a technocrat in the premier's seat. 

Moreover, in Russia, the head of the presidential administration is
traditionally more powerful than the premier. Since Yeltsin's tenure, the
head of administration or the person who enjoys the trust of the president
controls the main financial channels in the country. For that role, Putin
appointed his associate Kudrin. 

Kasyanov is not a rival for Putin. He cannot play his own political game.
He has no team and no social base. He has enjoyed a glittering career
because he has always followed the strongest players. If Putin decided to
gain more independence from the Family, Kasyanov would turn his back on
them, too. 

Kasyanov survives in the bureaucratic jungle because he is never slow to
abandon a loser. It is possible that Kasyanov will soon begin to shield
Putin from political attacks, but it is unlikely that Kasyanov will try to
forge an independent political role for himself. 

There are rumors that Kasyanov is a KGB officer like Putin. That is why, it
is said, he would never break the law or intrigue against the head of
state. Kasyanov is fighting against the St. Petersburg group not to make
Putin weaker, but to get closer to Putin. 

Finally, Putin cannot ignore the fact that Kasyanov enjoys the political
trust of Russian society. Kasyanov was at Putin's side during the election
campaign. 

Kasyanov was a member of Gosplan, the former Soviet state planning
organization, and is a close friend of former Gosplan head Yuri Maslyukov,
who is now a key figure in the leftist opposition. This makes Kasyanov
indispensable to Putin for making deals with leftists. 

For these reasons, Putin will not replace the first head of his government
in the near future. 

******

#6
Wall Street Journal
July 5, 2000
[for personal use only]
Putin's Critics Fear Russia Resembles Pinochet's Chile
By PAUL HOFHEINZ (paul.hofheinz@wsj.com)
Staff Reporter of THE WALL STREET JOURNAL

To hear the pundits tell it, Russia is about to disappear again behind a wall 
of darkness.

President Vladimir Putin, they say, is erecting a police state, jailing his 
opponents, harassing journalists and disregarding human rights. They say that 
the career secret service officer has already made the letters FSB, as the 
renamed KGB is known, into an acronym almost as ominous as the one it 
replaced. They hint darkly that the president's years in power will be a 
Russian version of Augusto Pinochet's reign in Chile -- a liberal economic 
reform combined with disregard for civil and other human rights.

Are they right? Certainly, Mr. Putin's record since his swearing in last May 
gives pause for concern. In a mere nine weeks on the job, his underlings have 
been very busy. They have jailed a prominent oligarch whose television 
station opposed government policy, threatened to remove regional governors 
from the second chamber of parliament, dispatched heavily armed "tax police" 
to confiscate documents from prominent businesses and launched criminal 
investigations into some controversial sales of government assets.

Moscow-based liberals are sounding the alarm. "A repressive police state is 
no alternative to a semi-criminal oligarchy," liberal Grigory Yavlinsky 
intoned last week, at the annual World Economic Forum Central and Eastern 
European Economic Summit in Salzburg, Austria. "[Chilean dictator Augusto] 
Pinochet is not an alternative to [Russian President Boris] Yeltsin," he 
added.

But in many ways, the analogy misses the point. The truth is, in a mere nine 
weeks, Mr. Putin has demonstrated a stronger capacity for instilling chaos 
than bringing order. Rather than take on the nation's evident problems, he 
has let himself get seriously bogged down in Moscow's blood feuds and petty 
intrigues. So far, he has alienated most of his former allies, including the 
oligarchs, the Moscow-based liberals and the regional governors. And he has 
achieved very little in the process. At a point when most Russian leaders 
were lining up support for their plans, Mr. Putin has spent his first few 
weeks needlessly antagonizing the very constituencies he will need to govern. 
The damage done is already so deep that it remains to be seen if his 
presidency can recover.

Consider this: Mr. Putin has an economic plan. It is an excellent program -- 
one that promises to reform the tax system, push through deep-seated 
industrial restructuring and deliver 5% economic growth. But, thanks to the 
heavy-handed tactics the FSB has shown in recent weeks, economics minister 
German Gref has spent more time fending off comparisons with Augusto Pinochet 
than explaining the policies behind the program itself. "Violation of human 
rights can only affect economic reforms," Mr. Gref told the same Salzburg 
audience Mr. Yavlinsky spoke to, adding that the government was not out to 
roll back the privatization program his predecessors oversaw. "Our policy is 
based on a new social contract," he said.

Even worse, there are increasing signs that the government Mr. Putin leads 
has ambiguous feelings about the program itself. Prime Minister Mikhail 
Kasyanov has sounded lukewarm about the plan in public. Mr. Gref has denied 
that there are rifts in the government.

In the meantime, the economic plan is about to go before the Duma, where it 
will likely be approved. But it remains to be seen what -- if anything -- Mr. 
Putin will do to get the program accepted in the regions. "The problem is not 
that no one knows what needs to be done," says Thomas E. Graham, a senior 
associate at the Carnegie Endowment for International Peace. "The issue is 
how you sell it all politically. So far, Mr. Putin is not building a 
consensus. And he has opened fissures up among the elite."

At the end of the day, Mr. Putin's presidency may come to bear less 
resemblance to Pinochet's time in office than to former U.S. President Jimmy 
Carter's ill-fated reign. During his truncated presidency, Mr. Carter let the 
petty squabbling of his staff paralyze his government. At a moment when 
Americans were crying out for leadership, he withdrew into the privacy of his 
office, where he poured over the memos his staff had presented to him, made 
decisions alone and did little to take the pulse of the nation he led. In the 
end, his support shrank to almost nothing. Voters showed him the door after 
only one term.

Could this be Mr. Putin's fate? Perhaps. So far, there haven't been many 
signs that this former KGB officer possesses the political skill he will need 
to govern Russia effectively. Remember: Apart from two years at the top of 
the FSB, this man took charge of a country without having run anything before 
-- not even a city government. And, after nine weeks in office, his 
inexperience shows. Already, he is growing increasingly isolated in a job 
where few can afford to be found alone. Economic reform will have a hard time 
finding fertile soil in a climate like this one.

******

#7
Hawkish Russian general says seeks good NATO ties

MOSCOW, July 6 (Reuters) - A member of Russia's Defence Ministry known for 
his anti-Western views said in an interview published on Thursday that Moscow 
wanted better ties with NATO, but ruled out joint training exercises this 
year. 

``Today we are open for normal relations with the North Atlantic bloc,'' 
Colonel-General Leonid Ivashov, head of the ministry's international 
division, told the Izvestia daily. 

``The task is to take relations to a level where we not only talk but also 
reach agreements,'' Ivashov said. 

But Ivashov, who at the height of the Kosovo war last year described NATO as 
a criminal organisation, said that Russia saw little point in taking part in 
joint military training exercises, at least this year. 

``We do not intend to waste resources and already limited finances on 
exercises held just for the sake of holding them,'' he said. ``From the 
military point of view, most exercises have no practical value.'' 

He added that some NATO members have an openly ``anti-Russian character'' but 
did not say which countries he had in mind. 

Ivashov recently said in an interview for a Finnish newspaper that NATO's 
Partnership for Peace (PfP) programme -- designed to forge closer ties 
between the alliance and former Cold War foes -- was a ``mere backdrop to the 
rehearsing of military actions against Russia.'' 

Asked by Izvestia about his hardline image, Ivashov said: ``I become a hawk 
when I see a threat to Russia's interests.'' 

Russia froze relations with NATO after the alliance began its bombing 
campaign against Yugoslavia. It relaxed that stance earlier this year and 
NATO's secretary-general, Lord Robertson, visited Moscow. 

Moscow nonetheless remains fiercely opposed to NATO plans to admit new 
members from its former sphere of influence in central and eastern Europe. 

Russia also ignored an invitation to take part in joint naval exercises last 
week in the Black Sea near the Ukrainian city of Odessa, which included 10 
NATO countries and six ex-communist nations, including Ukraine. 

******

#8
St. Petersburg Times
July 4, 2000
EDITORIAL
FSB Pushing Regressive National Idea

DMITRY Barkovsy and Konstantin Suzdal are couple of 20-year-old students from 
Baltic State University in St. Petersburg who were expelled because they 
refused to spy on the activities and fellow members of the Yabloko political 
faction for the Federal Security Service, or FSB, the KGB's successor agency.

The university claims that they were ejected because of poor academic 
performance, but a four-hour interrogation by local prosecutors - during 
which they were threatened with expulsion should they refuse to cooperate - 
and their outstanding scholastic records would seem to rule that out.

On May 15, Yabloko leader Grigory Yav linsky wrote a letter to FSB head Mik 
hail Patrushev focusing principally on three questions:

1. Was Barkovsky wanted for any crimes?

2. Is the FSB investigating the Yabloko political movement?

3. Isn't it now time that Putin orders an investigation if he feels there has 
been wrongdoing?

Later, Yavlinsky adds that any cloak-and-dagger routines are unnecessary, as 
the party will gladly furnish all the required documents.

He has also written Vladimir Ustinov, the Prosecutor General, with the 
suggestion that a spying campaign is being waged against his party.

So far, Yavlinsky's letter - from a major political player in this country - 
has been dismissed by Petrushev and Ustinov as apparently too time-consuming 
to answer. At least, Yavlinsky's heard nothing so far.

Perhaps answers and accountability have become obsolete and bothersome chores 
for the government. Whatever happens further to Barkovsky and Suzdal will 
likely happen in obscurity, as with what happened to other "enemies," such as 
Andrei Babitsky.

The deal with Babitsky was so that the Chechen War could take place away from 
journalists' cameras. And it worked for the most part and without much 
protest.

Much of what happened to environmentalist Alexander Nikitin happened in the 
obscurity of an FSB cell as well, but he had international opinion on his 
side.

There has been much talk of Russia finding its new national idea. But the 
idea the FSB wants to promote is spying on your friends, fostering suspicion, 
punishing difference and rewarding xenophobia.

Either that, or the FSB and local prosecutors are trying to send a message to 
others who might consider working for Yabloko, an entity which these 
Soviet-minded hacks apparently don't understand.

In any case, the security service is trying to turn back the clock. Yabloko 
is sure that it won't succeed. We hope they're right.

******

#9
Moscow Times
6 July 2000
Paper Says Luzhkov May Soon Lose Job
By Ana Uzelac 
Staff Writer 

In what appears to be another episode of the continuing battle between the
Kremlin and Moscow Mayor Yury Luzhkov, a major news daily has predicted
that Luzhkov will soon be squeezed out of office along with his most loyal
aides. 

Luzhkov immediately dismissed the report as "nonsense" and accused Kremlin
insider and political power broker Boris Berezovsky, who owns the paper, of
being behind the article.

The unsourced story in Wednesday’s issue of Kommersant claimed Luzhkov has
reached an agreement with the presidential administration guaranteeing him
immunity from legal prosecution in exchange for his resignation. The
alleged deal is redolent of the immunity granted by President Vladimir
Putin to his predecessor Boris Yeltsin hours after Yeltsin’s resignation in
December.

There was no immediate reaction by the Kremlin.

The story said Luzhkov’s resignation would be preceded by wide-scale
dismissals in the city government in an attempt by the Kremlin to transfer
power to Deputy Mayor Valery Shantsev, whose powers have been increasing
steadily since late last year and whom the Kremlin perceives as potentially
more compliant than the ambitious Luzhkov. 

The paper predicted that the first city officials to go would include some
of the most loyal members of Luzhkov’s team, but ones who had had conflicts
with Shantsev. Kommersant identified the prime candidates for dismissal as
Oleg Tolkachyov, the man in charge of property and land issues; Vladimir
Resin, a deputy mayor in charge of construction and development; Deputy
Mayor Iosif Ordzhonikidze; and the head of the department for consumer
goods and services, Vladimir Malyshkov. 

In a televised interview on NTV, Luzhkov dismissed all of Kommersant’s
allegations as "nonsense," "provocation" and the "ravings of a madman." 

"The publication was ordered by Berezovsky and those people who are …
interested in the destabilization of the situation in Russia," said Luzhkov
in a pre-taped interview for his TV Center channel, according to Interfax. 

The mayor accused those behind the publication of trying to sow discord in
the city government using a divide-and-conquer technique, defiantly adding
his reply to his enemies: "You won’t ever see it happen!"

Some political analysts said there might have been more truth to the
publication than the mayor cares to admit, but they were circumspect in
assessing the radical scenario described by Kommersant. 

Vyacheslav Nikonov, head of the Politika think tank, who is considered
close to Luzhkov, called the idea of the mayor’s resignation "too
farfetched." 

"Luzhkov is still far too powerful to be removed that easily," Nikonov
said. "But there is no smoke without fire.

"Clouds are indeed gathering over the heads of some of the members of the
city government."

Nikonov — who described the relationship between the Kremlin and the mayor
as a "cold peace" — allowed for the possibility that some city officials
might be "sacrificed" in the ongoing battle for control of the capital. 

"But for that to happen the pressure would have to come from the highest
level," he said.

According to a source at the mayor’s office who asked not to be identified,
the publication came as somewhat of a surprise. 

"Although from time to time the likelihood of Luzhkov’s removal from office
would increase, now that didn’t seem to be the case. … In fact, right now
Luzhkov’s relations with Putin and the Kremlin seem to be rather calm and
almost cooperative," he said. 

Relations between the Kremlin and the mayor’s office — which became
especially confrontational during last December’s parliamentary elections —
have been a roller coaster of conflict and reconciliation in recent months.

Prospects of peace seemed to set in after Putin’s recent visit to Italy, on
which Luzhkov accompanied him as a part of the official delegation. Local
media reported the mayor was granted a three-hour audience with the
president on the way back to Moscow, and Luzhkov radiated optimism after
the trip, predicting a quick settlement to the thorniest issues between the
city administration and Kremlin — including the future of the city’s TV
Center channel. 

The frequency used by TV Center is set to be put up for tender Thursday and
is widely perceived as a litmus test of the relationship between Luzhkov
and the presidential administration.

But last week local media reported that the State Building Committee, or
Gosstroi, has proposed that Moscow land on which buildings housing federal
institutions now stand should become federal property. According to this
plan, the state would also get adjacent property, including potentially
lucrative construction sites.

If implemented, the plan could deal a big financial blow to the city, since
the takeover would deprive the municipal budget of some hefty revenues. 

A similarly unfriendly mood has settled over the protracted dispute over
former Moscow city police chief Nikolai Kulikov, a Luzhkov ally who was
dismissed in December by Yeltsin from the post of deputy interior minister. 

The long legal wrangle over Kulikov’s dismissal ended in May when the
Presidium of the Supreme Court ruled that he should not be reinstated. 

Tuesday, news agencies cited Luzhkov as saying that Putin had signed a
decree reinstating Kulikov, but the former city police chief submitted a
letter of resignation immediately thereafter. Nevertheless, Luzhkov
expressed his gratitude to the president for "clearing Kulikov’s good name." 

But on Wednesday, a Kremlin spokesman denied that Putin had signed such a
decree, Interfax reported.

Andrei Ryabov, a political analyst with Carnegie Moscow Center, said
Kommersant’s publication was indicative of a new style of political
relations in the country, marking an end to the power-sharing deals and
"bureaucracy ethics" that dominated under Yeltsin.

"Then, political foes were able to reach gentleman’s agreements: … Luzhkov
would have been forced to abandon his ambitions as a federal-level
politician, but would have gotten to retain his power over Moscow," Ryabov
said.

"I’m afraid we’re entering a phase when no politician will be sure of his
place anymore. The only thing that’s worrying is that a political system
where everybody lives in constant anxiety over his nearest future simply
cannot function," he concluded

******

#10
Summers-Russia economy improving, challenges ahead

UNITED NATIONS, July 5 (Reuters) - Russia's economy has improved 
substantially and the government must now create a strong legal framework so 
recent growth can be sustained, Treasury Secretary Lawrence Summers said on 
Wednesday. 

Speaking to reporters at the United Nations, Summers welcomed Russia's 
healthier budget and higher reserves. 

"There has been a substantial improvement in Russian economic performance in 
recent months and that has been manifested in part in a significant 
improvement in Russia's budget situation and in an augmentation of Russia's 
reserves," he said. 

"The challenge going forward will be for this growth to be sustained rather 
than being a one-off adjustment to changed conditions." 

The latest growth is in part due to stimulus from a steep currency 
devaluation in the summer of 1998, and some Western analysts say structural 
reforms are needed to ensure that growth remains on track. 

"What will be the most important...will be the successful bringing about of 
the rule of law so there can be reliance on secure property rights, 
confidence in contract enforcement and the general set of measures to go with 
an effective commercial system." 

Many investors have fought shy of Russia because of opaque legal systems and 
confusing rules on shareholder rights. 

Summers also said that Argentina's government was very much committed to 
fiscal and structural policies aimed at creating the basis for sustained 
economic growth. 

******

#11
Boston Globe
4 July 2000
[for personal use only[
Kidnappers thrive on chaos in Chechnya 
By David Filipov

MOSCOW - Adi Sharon was chained to a wall in a dark, filthy cellar for so
long 
that when the man in combat fatigues burst in, the 12-year-old Israeli native 
was convinced the Chechen and Russian kidnappers who had held him hostage for 
nine months had decided to kill him.

''I'm just a boy,'' the dazed and terrified captive reportedly pleaded in 
English, unable to comprehend that he was being rescued, and that the man was 
part of a special Russian police unit that had traced clues from war-torn 
Chechnya to the remote cottage in central Russia where Adi was found.

A Russian officer tried in broken English to comfort the pale, emaciated boy. 
Another 
wrapped bandages around Adi's hands, mutilated by his captors. Someone handed 
him a cell phone. His father, Josef, whom Adi had not seen since the day last 
August when gunmen snatched the boy from outside their Moscow apartment, was 
on the line.

''Papa, do you love me?'' Adi said, barely able to see or stand, still not 
understanding that he was free at last. ''Who are these men?''

Such is the brutality of the ransom-seeking abduction gangs that have thrived 
on the violent chaos in Chechnya. For all the terror and torture he suffered, 
Adi was one of the lucky ones. 

The boy's rescue on June 2, videotaped by police, is one of few recent 
success stories against kidnapping rings suspected of links to separatists in 
Chechnya.

Russian authorities say at least 850 kidnapping victims, and possibly several 
times that many, are believed to be held in Chechnya. But as Russian troops 
blast away at the Chechen foothills, raising fears that the captors might 
kill the hostages rather than risk discovery, Adi's case poses another 
disturbing possibility: that many of the kidnappers - and perhaps many of 
their captives - could be far away from Chechnya.

One of the main reasons Moscow gave for sending troops back into the 
separatist Caucasus region last October was to stamp out the epidemic of 
kidnappings during Chechnya's three years of de facto independence following 
a 1994-96 civil war.

But the cruelty has proved contagious. Although hundreds of hostages have 
been freed since Russian troops swept through most major Chechen towns, the 
abductions have continued, kidnappers are still looking for big money, and 
some Chechens contend that Russian military units sent into Chechnya to 
restore order are holding hostages for ransom, too.

This sordid business continues for one reason: because it is wildly 
profitable. Russian police estimate that $200 million in ransom money has 
been paid out to gangs based in Chechnya since 1997.

Russian officials refer to ''special operations'' to free hostages but rarely 
go into details. This has led to widespread speculation that in many cases 
the ransom is paid to shadowy intermediaries.

''There is no doubt that in all of the cases where hostages are released 
money is paid,'' said Vyacheslav Izmailov, a journalist and former army major 
who investigates kidnappings in Chechnya. He cited the June 14 release of 
French photographer Brice Fleutiaux after eight months in captivity. Izmailov 
says the kidnappers received $500,000 from unidentified Russian sources.

Yelena Rumyantseva, spokeswoman for Russia's police unit that investigates 
organized crime, denies that money was paid for Fleutiaux's freedom. But she 
acknowledges that in many cases, relatives have paid ransom to free loved 
ones without going to the police.

Russian authorities say thousands of people, including a handful of 
foreigners, but many more Russians and Chechens, have been held for ransom. 
Hostages have been tortured and maimed by their captors. Then the kidnappers 
send videos along with demands for ransom to the victims' relatives. 

Many of the captives - human rights workers, missionaries, journalists, 
government and religious officials, soldiers, police officers, and children - 
were abducted in neighboring Russian regions and then taken into Chechnya. 
The region's quasi-independent status has made it nearly impossible for 
Russian authorities to investigate the abductions.

Often, the victims have been traded or sold from one gang to another. 
Sometimes, victims were betrayed by people they trusted. Svetlana Kuzmina and 
Viktor Petrov came to the Caucasus in 1997 to try to find a Russian soldier 
from their Volga hometown who had disappared during the fighting in Chechnya 
in 1995. One of the intermediaries they had hoped would help them instead 
turned them over to a kidnapping ring, which then sold Petrov and Kuzmina to 
a Chechen warlord named Kyuri for the price of two Land Rovers.

But not all the kidnappings were carried out in the Caucasus by Chechens. 

Alla Geifman, 12, who was freed after seven months in captivity in December, 
was kidnapped from outside her house in the Volga River city of Saratov and 
driven by truck to Chechnya. The kidnappers were later arrested, but not 
before they sent 13 people, five of them minors, to Chechnya. 

The ringleader and several members of the gang that kidnapped Adi Sharon were 
Chechens, but among their accomplices were six ethnic Russians. And although 
the kidnappers made it appear that the boy was being held in Chechnya, police 
eventually found him in Russia's Penza region, 600 miles to the north.

''Unfortunately, there were Russians among the kidnappers, and the 
kidnappings have happened everywhere,'' said Rumyantseva, the police 
spokeswoman. ''We began to realize that no one was completely safe anywhere.''

Rumyantseva said the presence of Russian troops in Chechnya has made it 
harder for kidnappers to take their captives across borders.

''But I don't rule out that they are doing it right now,'' she said.

Russian police say that most of the remaining hostages are in Chechnya. But 
this is hardly a comforting prospect.

''I fear that only one in 10 of them will live,'' said Kiril Perchenko, 20, a 
Moscow video producer who was abducted in the Russian capital and spent six 
months as a hostage in Chechnya before he escaped, he said, to Russian lines 
in mid-February. 

Perchenko said his Chechen captors, followers of the Chechen warlords Arbi 
Barayev and Ramzan Akhmadov, routinely chopped off the fingers and hands of 
captives while forcing the others to watch. The hostages were forced to carry 
weapons and dig trenches. When a Russian photographer was unable to keep up, 
Perchenko said, he was shot. When a captive Russian lieutenant attacked a 
Chechen guard, Perchenko recounted, the Russian officer was beheaded as the 
rest of the captives watched.

Children have not been spared. Adi Sharon's captors cut off the ends of both 
his little fingers to press their demands that his father, a wealthy 
businessman who works in Moscow, pay $8 million in ransom.

Alla Geifman, the 12-year-old girl, told reporters after her release that her 
captors grew impatient as the months dragged on, cutting off one of her 
fingers. A month later, they cut off another and sent it to her father. They 
also sent him a cassette in which the girl is heard screaming ''Papa, they're 
taking off my pants.''

Geifman was in the news several weeks after she was freed when the US Embassy 
in Moscow failed to grant her a visa, instead requesting more information 
about the purpose of her trip. That refusal was taken up by the media here as 
a sign of what many Russians view as the West's unwillingness to hear 
Russia's side of why it is fighting in Chechnya.

But some Chechens say that the practice of holding captives for ransom has 
merely switched sides.

Chechens say that Russian paramilitary police routinely round up civilian men 
and put them in detention centers, then demand payment from their relatives 
for their release. Detainees who have been freed describe fierce beatings, 
mock executions, and other systematic mistreatment. Russian officials have 
repeatedly denied such charges as separatist propaganda.

The Chechens say the price for being freed varies, according to recent 
detainees - $200 to $300 for anyone arrested in peaceful villages, several 
times that for men detained near the fighting. These are small sums compared 
to what the Akhmadov and Barayev gangs allegedly demand, but still more than 
most Chechens can afford. 

Khalipat, a Chechen woman who asked that her last name not be used, described 
how she lobbied Russian officials for months in vain for the release of her 
son, Mudar, who was detained in January.

She said her efforts brought no results until she began dealing with a 
Chechen intermediary who promised her that for $2,000 he would free her son. 
It took Khalipat two months to collect the money from friends and family. By 
that time, she said, the price had gone up to $3,000.

Mudar went free, but Albert Idigov, detained in January, remains 
incarcerated. His mother, Khazan, said Russian officials agreed that her son 
should be freed. But she had no money to pay the intermediaries. 

Globe correspondent Usam Baisayev contributed to this report from 
Sleptsovskaya, Russia.

******