July 8th, 2000    
This Date's Issues: 4390 •   •

Johnson's Russia List
#4390
8 July 2000
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Russian scientists develop high-speed superboots.
2. RFE/RL: Sophie Lambroschini, Sociologists Evaluate Putin's 
Popularity.
3. John Danzer: Putin the middleman.
4. Kommersant - Vlast: GLEB PAVLOVSKY: "RUSSIA CAN BE EASILY
PROVOKED INTO REVOLUTION." Gleb PAVLOVSKY, the shadow consultant 
of the Kremlin, tells Yelena TREGUBOVA of Vlast what we can expect 
from the Kremlin and what "those who are traditionally called 
oligarchs" should do.
5. Celeste Wallander: change of address and affiliation.
6. Reuters: Russian Duma says no to secret police monument.
7. Financial Times (UK): Paradoxes in the Wild East: After six 
years in Moscow, John Thornhill is full of wonder at the resilience 
of ordinary people during a period of momentous change.
8. Interfax: PROSECUTORS EXPLAIN CHARGES AGAINST HEAD OF 
MEDIA-MOST HOLDING.
9. The Times (UK): Michael Evans, Russia prepares missile 
reply to 'Star Wars' test.
10. The Electronic Telegraph (UK): Marcus Warren, Russian film 
turns tables on Hollywood. (Brother 2)
11. the eXile: John Dolan reviews First Person: An Astonishingly 
Frank Self-Portrait by Russia's President, Vladimir Putin.
12. Reuters: Outlook for Russian bank reform grim.]

*******

#1
Russian scientists develop high-speed superboots
July 7, 2000

MOSCOW (Reuters) - Russian scientists are perfecting fuel-powered boots which 
allow the wearer to take huge strides at high speed, RTR state television 
reported Friday. 

The boots -- metal contraptions with pistons and a fuel tank that strap onto 
the wearer's legs -- were originally designed by the Soviet military during 
the 1980s in a top secret project, RTR said. A lack of funding meant the 
project was put on ice. 

RTR showed a tester at the Aviation Institute in the Urals city of Ufa, 900 
miles east of Moscow, stride across a public square looking like someone 
trying to run on stilts. 

It also showed footage of a policeman in full riot gear running around a car 
park using the boots, which expel blasts of exhaust fumes each time a step is 
taken. 

The boots increase the wearer's strides to four yards and allow him to move 
at up to 25 mph. 

Much of Russia's science industry is in tatters due to cash shortages 
following the breakup of the Soviet Union a decade ago, and because many 
scientists have emigrated to take up lucrative jobs abroad. 

*******

#2
Russia: Sociologists Evaluate Putin's Popularity
By Sophie Lambroschini

Russian President Vladimir Putin is preparing to deliver his state of the 
nation address to the country's Federation Council (upper house) on Saturday. 
In his speech, Putin is expected to give his assessment of the past few 
months and outline his plans for the future. But what do Russians think about 
the man they overwhelmingly supported in the presidential election just over 
three months ago? Has there been any shift in public opinion? Sociologists 
give their analysis after the results of a public opinion poll by the Agency 
for Regional Political Studies, ARPI, was made public today. RFE/RL's Sophie 
Lambroschini reports from Moscow. 

Moscow, 6 July 2000 (RFE/RL) -- Polls indicate Russians have become a happier 
people since Vladimir Putin became president, and they still put a lot of 
hope and trust in the man they elected on March 26. 

But pollsters disagree about how long this honeymoon will last. While some 
ARPI analysts think the ongoing war in Chechnya and continuing economic 
troubles are slowly beginning to erode his popularity, others think that 
Putin's image as "the good tsar" will give him unlimited credit at the 
expense of his presidential team. 

Inga Zakharova is an ARPI analyst. She says Putin's approval ratings have 
decreased slightly in recent weeks, from a high of 61 percent in May to 54 
percent in July. Part of this is natural, she notes: "Maybe because Putin was 
received with great emotion, and people were expecting immediate changes that 
did not take place. So people begin to assess the situation they ended up in 
more realistically. What happened, what could happen in a hundred days? What 
is really happening? And then they remember their hopes and they start to 
evaluate what they really have more with the intellect, more with the mind."

He may have been inaugurated just two months ago, but Putin has been in power 
since Boris Yeltsin resigned on New Year's Eve. Zakharova says that some 
people are already expressing disappointment at Putin's lack of palpable 
action on key fronts, especially the economy. When asked to name their 
greatest concerns, Russians usually put inflation first. Zakharova says 
worries about an increase in prices have grown, with almost a quarter of 
those surveyed expressing concern on the issue. 

She also points to a change in attitude on Chechnya. Asked what they would do 
about the rebellious republic, only a quarter of Russians surveyed said they 
would favor sending troops to Chechnya, if the war started today. By 
comparison, last fall, a full 60 percent of those polled supported military 
action. 

Another analyst from the same institute presents a different picture. Nikolai 
Popov says that Russian public opinion will go on supporting Putin no matter 
what. Calling Putin a "Teflon president" -- like the frying pan surface that 
nothing sticks to -- Popov compares Putin to former U.S. president Ronald 
Reagan, who enjoyed high personal support despite the unpopularity of some of 
his actions. He says such uncritical allegiance is a mentality inherited from 
tsarist times and further developed by the Soviet system. "To a certain 
extent, people still have a monarchist consciousness. The super-boss, the 
tsar, the president -- it doesn't matter what he's called -- he is the symbol 
of greatness or whatever. Anyway, raising salaries is not a tsar's business. 
And in that respect, the former authorities, Yeltsin during his two terms, 
and the present powers benefit from this resource -- the possibility to 
separate responsibility from the great leader of the country and [leave it ] 
to some manageable prime ministers," Popov says. 

According to Popov, if people begin to complain about their continuing 
poverty, they will blame the government, not the president. "And if something 
fails, the people will understand it that way. [They] are already 
understanding it that way. Just to give you one figure -- while support in 
favor of Putin changed in a very insignificant way over the past three 
months, the assessment of the government worsened noticeably after just one 
month in power." 

But a public relations specialist who helped Putin prepare his presidential 
campaign said this week that Putin must act quickly to fulfill some of his 
promises, or risk losing public support. Gleb Pavlovsky told the Russian 
weekly "Kommersant" that Putin didn't deliver quick results of his promise to 
fight corruption and tame the oligarchs, he could be challenged by rival 
politicians who will seek to capture public support by being even more 
"Putinist" than Putin himself. 

Pavlovsky has his own agenda in making such statements, implying there is 
popular demand for harsher actions. Nevertheless, sociologists do agree that 
Russians still see toughness as a positive political quality. 

*******

#3
Date: Fri, 07 Jul 2000
From: Telos4@aol.com (John Danzer)
Subject: Putin the middleman

Still trying to figure Putin out? Still believe that he is a
democrat? I stick by my assessment of Putin made April 3 of this
year. Rather than rely on what could be fabricated biographical
information and even his own statements I prefer using my own
methods of sizing people up. This isn't a forum for a lengthy
promotion of my theories but let's see if the man I described is
starting to come into focus.

Here is a summary of Putin's traits as I stated back in April.

1. He wants control. 2. He achieves control by following a plan. 
3. His curiosity is rather primitive and emerges as "snoopiness"
4. He avoids intimacy. 5. Loves yet fears to rule. His desire to
control is always at odds with his desire to fit in and adjust. 6.
Masks his arrogance under a mock humility. 7. Likes official
celebrations, anniversaries etc. because the situation dictates
exactly how he ought to behave.

Here is the most important point that I would like to repeat word
for word:

"Putin needs a strong state that will dictate to him what he is
supposed to do. He is not a dictator in the sense that Yeltsin
was-arbitrarily issuing decrees . Putin needs to feel that he is
carrying out the dictates of a structure that is above him. Since
he is also at the top he has to erect this structure himself." 

It now appears that he is building a structure he feels he will be
able to obey. The security council is the foundation of that
structure. He depends on them for his "plan" to preserve the
state. Once this structure is fully operational, perhaps as a
result of a declared emergency, Putin will once again enjoy the
role he is temperamentally predisposed to play - middleman.

There is a terrible danger in this situation. You have a governing
body that is a reflection of the middle man who picked them. They
have been chosen because they are all loyal middlemen but they
treat the decisions reached by their collective mind as
authoritative. Once Putin receives his orders he will unfailingly
carry them out. Little does he realize that his orders are coming
from the dark shadows of his own psyche.

******

#4
Kommersant - Vlast No. 26
[translation from RIA Novosti for personal use only]
GLEB PAVLOVSKY: "RUSSIA CAN BE EASILY PROVOKED INTO REVOLUTION"
Gleb PAVLOVSKY, the shadow consultant of the Kremlin, 
tells Yelena TREGUBOVA of Vlast what we can expect from the 
Kremlin and what "those who are traditionally called oligarchs" 
should do 
Question: The Yeltsin team, which made Putin our 
president, hoped that he would ensure the preservation of the 
former political system. Does it mean that their hopes did not 
come true? For as soon as he came to power, the new president 
attacked the very foundations of the old system. I don't know 
if it is good or bad, but oligarchs were the core of the state 
that Yeltsin had been building in the past ten years. 
Answer: First, Yeltsin did not build a state. He led a 
revolution for ten years, forcing the country to take on a new 
name - the Russian Federation - and a democratic declaration of 
intentions called "the Constitution of the Russian Federation." 
His departure amounted to a sanguinary battle between the 
so-called elites in a country populated by the poor. The task 
of the Yeltsin-Putin team was the same: to prevent a 
catastrophe of the state. It has been fulfilled. 
Second, it does not matter who thought what, for victory 
edits history and the winner edits his team. He decides whom he 
needs and who is the hindrance. And this choice can be 
unexpected for the men involved. We are trying to determine now 
whose victory was the victory of Putin. On whom should he rely 
now? Not on Unity, right? But on those who voted for him, on 
Putin's majority, by relying on whom he can allow himself to 
ignore any objections. 
But this Putin's majority is gradually setting the pace.
Putin is said: "It is good that you had such a quick start, 
everything is correct. But now you must show us what you would 
do next." This will be the main intrigue of the second half of 
this year. 
For ten years the masses complained that Yeltsin 
established "an occupation regime" and that "this is no way to 
live" - and continued to live calmly. This means that the 
existing balance suited them. But it does not suit them any 
more! The masses, which were not allowed to emerge on the 
political scene after 1991-93, have surged onto it today. And 
Putin is their leader.
One can argue in what sense he is the leader - the leader of 
the party of power or the leader of the opposition. I believe 
that those who chose Putin regard him as the leader of the 
opposition who seized power in Russia. For Putin's majority 
Putin is the leader of the party of opposition to the old 
regime. 
The way to democracy has been opened. On the other hand, I 
am not one of those idiots who hail those who will destroy them.
If the masses start moving, they will trample on us. 
The leader of the political process still has a margin of 
time to keep the power from going into the street again. But 
his time is running out. As I see it, these processes will 
gather speed dramatically in late August. It is very easy to 
provoke one more revolution now that Russia is only emerging 
from the previous, Yeltsin's, revolution. 
Putin has an advantage, which is that he is regarded as 
one of the masses and one of the tiny groups of the old 
political elite. They have started complaining of late, but 
they still regard him as one of them. Today all participants in 
the process should come to an agreement on the new rules of the 
game without delay. I am surprised that the oligarchs do not 
see this. For they will be the most vulnerable group if the 
street breaks free of Putin's bridles and starts dictating to 
him. And what are these people doing now? They are staging a 
struggle between the factions of the old regime for internal 
party democracy - in front of the whole country! And they draw 
the masses into their struggle through their mass media!

Question: It is rumoured that Putin plans to seek public 
support through a referendum. Do you think this is possible?
Answer: I would not like to have any referendums. Putin 
will automatically win all of them. This is why he should not 
be encouraged to use this method. 
But Putin must start talking directly with the people. He 
must explain to them his vision of the new rules of life. Putin 
as a strict mentor must enumerate these rules and show what 
would happen to those who violate them. If the rules stipulate 
a slap on the hand for touching property without the right to 
do so, this should be a very painful slap. An attempt on an 
official, even if the said official was involved in commerce, 
is terrorism on a par with the Chechen terrorism.

Question: What about the fashionable call for "reducing 
the situation to zero," meaning prohibit the redivision of 
property and court persecution for methods of its distribution 
in the past? Do you think Putin would do this?
Answer: As one of those who coined this phrase, I think we 
will have to do this. While restoring the institute of courts 
as a branch of power, Putin will have to explain the people 
that we should renounce mutual proceedings on "the 
revolutionary past." And the people will understand if Putin 
does the explaining. 

Question: How can you apply this method in practice? By 
adopting a law, or holding a round table with oligarchs?
Answer: We should meet more often! I cannot understand 
those who are traditionally called oligarchs. Why can they talk 
only at their country cottages? Why does not the big business 
unite? Why don't they advance suggestions - and even demands - 
to the authorities? Instead, they slip notes into Putin's hand 
- secretly from each other, and then complain that his 
secretaries have overtaken these notes. It's time we got rid of 
shadow politics. Only one man in this country - Vladimir Putin 
- has the right to shadow politics. Meaning that he alone 
cannot tell what is going on in his heart. He has no right to 
do this. 

Question: You predict an aggravation in August. In what 
form?
Answer: The main threat is the loss of speed by the leader.
This will provoke spontaneous initiatives, at first loyal to 
Putin (the story of Gusinsky is the case in point). This 
process will gradually become less and less controllable for 
Putin. What would he do in case of spontaneous mass "movement 
of Putin's supporters"? There will appear better Putins than 
Putin himself, who would accuse him of going too slow. And 
Putin would have to make decisions in a situation of time 
trouble. And this can affect the quality of decisions. 

Question: Do you see signs that Putin is getting ready for 
the crucial fight?
Answer: I see an in-built mechanism of rapid reaction in 
emergency situations in all actions of Putin in April-June. All 
his actions are designed to preserve control in case of 
super-critical situations. If we regard the real economic 
potential of Russia in late 1999 and the fighting waged by the 
elites then, we will conclude that Russia had no chances of 
survival in 2000. Putin's victory saved us from sliding down. 
But this does not mean that the elites will stop pushing one 
another at the edge of the precipice.

*******

#5
Date: Thu, 06 Jul 2000 
From: cwallander@cfr.org (Celeste Wallander)
Subject: change of address and affiliation

Dear David,

For yourself and other readers of JRL who may wish to contact me, please note
that my affiliation and location have changed to:

Celeste A. Wallander
Senior Fellow
Council on Foreign Relations
1779 Massachusetts Ave. NW
Washington DC 20036
(202)518-3425
(202)986-2984 (fax)
cwallander@cfr.org

******

#6
Russian Duma says no to secret police monument

MOSCOW, July 7 (Reuters) - Russia's lower house of parliament voted down a 
measure calling for the restoration of a monument to the father of the Soviet 
secret police on Friday. 

In a sign of the waning influence of Communists and their allies, two 
attempts to pass the measure fell more than 30 votes short of a majority in 
the State Duma. 

An almost identical bill passed easily in December, 1998, but was ignored by 
Moscow city authorities. 

The bill called for the restoration of a towering Stalin-era bronze statue of 
Felix Dzerzhinsky, founder of the ruthless Cheka secret police, which evolved 
into the NKVD and KGB security forces, responsible for the death of millions. 

The statue was torn down by jubilant crowds in 1991 from the pedestal where 
it had dominated a traffic circle in front of the feared KGB headquarters, 
the Lubyanka, in one of the memorable watershed scenes of the collapse of 
Communist totalitarianism. 

The Lubyanka is still the headquarters of the domestic secret police, now 
called the Federal Security Service, which was once headed by President 
Vladimir Putin. 

Moscow city officials ignored the 1998 bill calling for the statue's 
restoration and would have probably ignored it again. 

But the vote showed the waning power of the Communists and other left-leaning 
parties, the backers of the bill, after a 1999 parliamentary election watered 
down their hold on the Duma. 

Communists and their allies say Dzerzhinsky, known as Iron Felix for his 
uncompromising revolutionary zeal, was a model of firm leadership and was not 
responsible for many of the worst repressions, which occurred after his death 
in 1926. 

But liberals say Dzerzhinsky himself ordered the murders of countless 
``enemies of the revolution,'' and the movement to restore his statue is 
little more than nostalgia for dictatorship. 

Putin has often spoken of the importance of the security forces in building a 
strong Russia. But his parliamentary supporters opposed the measure to 
restore the statue. 

******

#7
Financial Times (UK)
8 July 2000
[for personal use only]
Paradoxes in the Wild East: After six years in Moscow, John Thornhill 
is full of wonder at the resilience of ordinary people during a 
period of momentous change

A few weeks before Russia's presidential election in 1996, I happened to sit 
next to one of President Boris Yeltsin's top political advisers on a flight 
to the Arctic coal mining town of Vorkuta. As he drank beer and palmed 
peanuts into his mouth, he expressed no doubt that Mr Yeltsin would win the 
ballot and go on to destroy Communism and build a free-market economy. It all 
sounded so simple. 

The adviser reminisced about a trip he had made with Mr Yeltsin to London 
several years before. Mr Yeltsin had been amazed to see people taking money 
out of a wall using an automated teller machine. Soon armed with a plastic 
card of his own, Mr Yeltsin had rushed to do the same and such was his wonder 
at the process that he had repeated the exercise several times. 

The adviser then proudly showed me his card for an ATM in Moscow. Within a 
couple of years, he assured me, Russia's biggest enterprises would be 
generating vast wealth and competing with the best in the world. Capitalism, 
it seemed, was as easy as extracting money from a machine. 

But in the same way that many Russians in the early 1990s had a strikingly 
naive understanding of how capitalism and democracy operated in the west, so 
many foreigners had equally simplistic notions about the reformability of 
Russia. The collapse of the Soviet Union coincided with a surge in 
neo-liberal rhetoric and excitable chatter about the End of History. The Wild 
East was simply the final frontier of capitalism waiting to be tamed and 
would eventually evolve in the same way as 19th century America, irrespective 
of Russia's very different social patterns and historical traditions. 

However, Russia's rattling financial crash of August 1998 soon shattered the 
illusions of both Russians and foreigners. It became clear to many Russians 
that a market economy is not just the product of human nature but also of 
political culture, which can take decades to establish. It became just as 
clear to many foreigners that, in spite of its people's astonishing 
intellectual prowess, Russia remains in many respects a Third-world country 
with a broad chasm between state and society. 

The great whirl of historic events in Russia in the early 1990s gave the 
impression that everything had changed. But the immense difficulties 
experienced in constructing the foundations of a new political economy 
suggested that society had not. In what President Vladimir Putin has called 
the nation of paradoxes, both propositions appear to be simultaneously true. 
An optimist, they say in Moscow, is someone who compares modern Russia with 
the Soviet Union; a pessimist compares it with a "normal" country. 

Anatoly Chubais, who was one of the main drivers of Russia's reform efforts, 
counts himself among the optimists, arguing that Russia is now living in a 
different historical epoch to that of a decade ago. 

In the field of government, Mr Chubais points to the fact that Russia now 
boasts a functioning constitution, an electoral system for choosing local, 
regional, and national leaders, a division of powers, and a federal system of 
government. In the social sphere, he highlights freedom of expression, 
freedom of the press, and freedom of travel, which have transformed Russian 
society's mentality. 

In the economy, he argues that most prices have been liberalised and that 75 
per cent of the economy is now in private hands. Throughout much of the 
Soviet period, he recalls, any involvement with the private sector was 
outlawed by a criminal code earning the "speculator" three to seven years of 
prison. 

Mr Chubais concedes that many of Russia's political bodies are ineffectual, 
that many of its freedoms are partial, and that its property rights are still 
alarmingly vulnerable to arbitrary state intervention. "Nevertheless, these 
institutions have been created, and therefore I say we are not only living in 
a different country, but a different state, a different society, a different 
economy." 

Yet, arguably, the election of Mr Putin to the presidency in March highlights 
the extent to which Russia has resisted change over the past decade and how 
some of the age-old patterns of history appear to be reasserting themselves. 
According to Sergei Kovalyev, the liberal MP and prominent human rights 
campaigner, the Kremlin simply selected Mr Putin as Russia's leader and 
manipulated the political process to ensure that the voters formally elected 
him. The war in Chechnya was used as a means of consolidating society around 
a new strongman. 

"Putin is the creation of a closed and non-transparent political system. The 
procedure of the elections simply rubber-stamped a decision which had already 
been taken by behind-the-scenes plotters. That is all," Mr Kovalyev says. 

Mr Kovalyev thinks it perfectly possible that Mr Putin may yet turn on some 
of those who brought him to power. "History is full of examples of such 
creatures destroying their parents," he says. "But history does not know one 
example of a leader who came to power as a result of such machinations, 
creating a fundamentally decent system of political relations." 

Perhaps the most alarming aspect of Mr Putin's rise to power is the 
acquiescence of much of the population. Tired of constant political 
instability and economic degradation, there is a palpable longing among many 
for the reassertion of a strong hand. One recent opinion poll suggested that 
42 per cent of the population supported Soviet-style democracy while a 
further 13 per cent had no objections to a dictatorship. 

According to Mr Putin, belief in a strong state is part of the genetic code 
of every Russian. And the president's supporters argue that the state has 
always been the main generator of the country's political momentum and 
economic growth. Besides, they add, authoritarian methods have often proved 
the most effective means of modernising backward countries, be they 
Singapore, Chile, or South Korea. 

But Vladimir Ryzhkov, a moderate MP, argues that if Russia pursues the 
authoritarian route it would be more likely to develop along the lines of an 
Uzbekistan or a Turkmenistan. In these former Soviet, central Asian states, a 
one-party system has been constructed around the president with an oppressive 
state bureaucracy stifling initiatives generated by civil society. 

Mr Ryzhkov believes that Russia is enough of a pluralist society to resist 
this authoritarian drift. He argues that much will depend on whether Russia's 
fractious democratic politicians can mobilise the support of the 26 per of 
the population who say they want to follow a democratic, European path of 
development. "The future of Russia depends on the actions of the authorities 
and politicians but it also depends to a decisive degree on the reactions of 
society. Neither I, nor you, nor anyone else in Russia can say what the 
outcome will be." 

Over the past decade, Russia has experienced an economic slump worse than the 
one suffered by the US at the time of the Great Depression; it has endured 
the sudden loss of empire; and it has survived the destruction of a political 
regime that had moulded people's minds for seven decades. With the tragic 
exception of Chechnya, these bone-shuddering events have been accompanied by 
minimal social upheaval and bloodshed. The most extraordinary story in Russia 
has been the one that has not happened. 

My personal contempt for the cynical rapaciousness of much of the old 
Communist nomenklatura has been tempered by my wonder at the resilience of 
Russia's people. If asked, my preference would unquestionably be to support 
those politicians who want to create a civil society based on the collective 
good sense and energy of the people rather than those leaders who prefer to 
reassert the power of the state based on the convenience of the Kremlin. 

Yet as long ago as 1951 the far-sighted US diplomat George Kennan warned that 
it would be senseless for foreigners constantly to measure Russian politics 
by western yardsticks once the Soviet system disintegrated. 

"Give them time; let them be Russians; let them work out their internal 
problems in their own manner," Mr Kennan advised. "The ways in which people 
advance towards dignity and enlightenment in government are things that 
constitute the deepest and most intimate processes of national life. 

"There is nothing less understandable to foreigners, nothing in which foreign 
influence can do less good." 

******

#8
PROSECUTORS EXPLAIN CHARGES AGAINST HEAD OF MEDIA-MOST HOLDING
Interfax 

Moscow, 7th July: Russian Deputy Prosecutor-General Vladimir Kolmogorov has 
sent an official letter to the chairman of the State Duma security committee, 
Aleksandr Gurov, outlining the criminal case against Vladimir Gusinskiy, 
chief executive of the Media-Most holding company. 

"Gusinskiy's criminal activities directed at taking over federal property 
have been proven by objective evidence such as witness reports, documents, 
expert analysis and other materials in this case," says the letter, copies of 
which were distributed to State Duma deputies on Friday [7th July]. 

"The investigating team has evidence that Vladimir Gusinskiy, director of the 
Most Group company, was involved in the fraudulent acquisition of ownership 
rights to the 11th TV channel, which was a structural unit in the federal 
state-owned enterprise Russkoye Video," the letter reads. 

The evidence shows that, "acting in criminal conspiracy", Gusinskiy and 
Russkoye Video head Dmitriy Rozhdestvenskiy (who himself was earlier brought 
to justice) "initiated in 1996 the setting up of several legal entities and 
entry into existing ones", it reads. 

The Prosecutor-General's Office "has evidence at its disposal suggesting that 
Vladimir Gusinskiy obtained in commercial banks, notably those that he 
controlled, loans against shares in organizations and enterprises of which he 
is the chief executive or founder, and deposited the funds into the accounts 
of other organizations in Russia and abroad", the letter reads. 

******

#9
The Times (UK)
8 July 2000
[for personal use only]
Russia prepares missile reply to 'Star Wars' test
BY MICHAEL EVANS, DEFENCE EDITOR

RUSSIA is believed to be preparing to test launch its new mobile SS27 
intercontinental ballistic missile. 

American intelligence agencies are understood to be monitoring activities at 
a base on the Kamchatka peninsula. 

The Japanese are also involved in keeping a watch on a possible missile test, 
according to Paul Beaver of Jane's Information Group. The Kamchatka 
peninsula, in eastern Russia, is about 500 miles from Japan. 

Any test of a Russian ICBM would be seen as a deliberately timed move by 
Moscow to coincide with America's test flight of its prototype anti-missile 
defence system. The latest test of the so-called "son of Star Wars" 
programme, involving a Minuteman ICBM with a dummy warhead, which would be 
targeted by a guided interceptor more than 120 miles over the Pacific, was 
set for early today. 

President Putin has warned the Americans that if they go ahead with the 
deployment of a national missile defence system to counter the perceived 
threat posed by North Korea, he could retaliate by abrogating the Start II 
treaty, recently ratified by the Duma, the Russian parliament. 

The implied threat is that Russia would add more warheads to the SS27 which 
at present is a single-warhead ICBM. Under Start II, all land-based strategic 
missiles with multiple independently targeted warheads are to be scrapped. 
When the Duma voted to ratify Start II this year, Russia reserved the right 
to renege on the treaty if the US went ahead with its national missile 
defence system in breach of the 1972 Anti-Ballistic Missile Treaty. 

According to Jane's Information Group, Russian reports about the SS27 have 
emphasised the invulnerability of the new missile to anti-ballistic missile 
defences. "It has a more energetic first-stage engine and incorporates a new 
warhead and re-entry vehicle with reduced vulnerability to interceptors," a 
Jane's spokesman said. 

The US has tried to reassure Russia that the proposed national missile 
defence system will not affect the credibility of Russian strategic weapons. 

The SS27 Topol-M can be road-mobile or silo-based. It is believed to carry a 
warhead with a 550-kiloton yield. 

******

#10
The Electronic Telegraph (UK)
8 July 2000
[for personal use only] 
Russian film turns tables on Hollywood
By Marcus Warren in Moscow

BY the end of the summer's most popular Russian film, "Good" has defeated 
"Evil" and a few dozen Chicago pimps, lowlife scum and unlucky office workers 
have been blown away by its hero.

Danila Bagrov may be a young and inarticulate thug but he succeeds in 
imposing his form of justice on an unsuspecting United States during a 
four-day killing spree and, mission accomplished, heads home to the 
motherland. The Brother 2 is Hollywood turned upside down, with Russia and 
Russian values taking on and triumphing over the West.

At the box office the film has been a sensation, grossing more than £500,000 
in weeks, a huge sum for a Russian production on the domestic market. Its 
impact on the critics has been no less spectacular, and one of the country's 
most powerful tycoons has privately suggested that the film is the "key to 
understanding" modern Russia. "This is not just the best Russian action movie 
in years," said Georgy Mkheidze, the managing editor of Russia's Premiere 
magazine. "It heralds the start of a whole new era of Russian cinema." 

Superficially, the film is payback time for the decades in which Hollywood 
demonised Russians as sinister baddies, either as ruthless Communists or, 
more recently, Mafia hoodlums. And yet it has already been hailed as a 
cinematic expression of the hostility to the West that peaked during Nato's 
bombing of Yugoslavia last year. Some have even seen in the film an 
embodiment of the new national idea defined by President Putin at the start 
of the latest Chechen war - "doing them in in the bog", "them" being 
terrorists or any other of Russia's enemies.

Bagrov is a veteran of the first Chechen war himself and - half Robin Hood, 
half killing machine - he uses the skills he learnt in the army to right the 
wrongs committed by his own enemies, most of them foreigners. His morality 
based on the Russian idea of justice eventually wins against that of the 
crooks he encounters in Chicago. "Tell me, American. What is power? Money?" 
he asks an organised crime boss against the backdrop of the city's skyline 
after massacring his way into his office. "I think power is truth. Whoever 
has truth on his side has power."

Alexei Balabanov, the film's director, describes himself as "orthodox" and "a 
nationalist" and his self-confessed contempt for emigres and political 
correctness is writ large in the raw racism of the characters. For some, 
however, the film is an example of lavishly shot but cynical exploitation of 
nationalist feeling - and the hundreds of thousands of young Russians who 
identify with its hero.

******

#11
Date: Fri, 07 Jul 2000 
From: "Mark Ames" <exile.editor@matrix.ru> 
Subject: exile book review

eXile review
July 6, 2000
www.exile.ru

First Person: An Astonishingly Frank Self-Portrait by Russia's President,
Vladimir Putin
with Nataliya Gevorkyan, Natalya Timakova, and Andrei Kolesnikov
Public Affairs: New York 2000
$15

By John Dolan

Putin the Permanently Surprised

In First Person, Vladimir Putin presents himself as an amnesiac innocent
who just happened to work for the KGB for a couple of decades and then by
accident wound up as President of the Russian Federation. You get the
impression of a man who wakes up each morning, looks outside and says,
"Just think of it! The sun rose again!" Putin then notices a lump in the
bed next to him and says, "Lyuda! It is 'Lyuda,' isn't it?" As his wife
nods wearily, Putin places his hand on his heart and says, "I'm
touched--you stayed the night!" At this point, the Putins' dog Toska
enters, and Putin draws back in terror: "No, this is too much! There's an
animal in the house!" His two daughters follow, running into their parents'
room to say good morning, and Putin smacks himself on the forehead, "My
God! You mean we have children?" He turns to Lyuda and says embarrassedly,
"So does that mean we....?" Once again, Lyuda gives him a weary nod. 

First Person uses a Q&A format to present Putin as an ordinary guy, telling
his life story to three friendly Russian journalists. It's all studiedly
casual. As the journalists explain, "These were meetings 'with our jackets
off'--although we all still wore ties." The journalists toss Putin very
soft questions. Only in the last part of the book, when they bring up the
Babitsky case, do they show any spirit at all. And there, of course, it's a
matter of protecting the interests of the journalist's guild. For the rest
of the book, they let Putin get away with simple-minded answers which would
have shamed Reagan, and bouts of selective amnesia even Sgt. Schultz would
have rejected as far-fetched. 

Putin's strategy (or the one developed for him by his handlers) is simple:
he is a dull man, and he wants you to know it. He insists on it. There's
nothing like a coat of gray paint to cover up bloodstains and other
evidence, and Putin paints himself grayer than a mothballed battleship,
managing to make a life spent in intrigue and corruption seem as bland as
the career of a Safeway checker. 

Putin summarizes his life in a sort of prose poem printed at the beginning
of First Person. It's worth quoting in full, for its remarkable compound of
dullness and guile:

"In fact, I have had a very simple life. Everything is an open book.

I finished school and went to university.

I graduated from university and went to the KGB.

I finished the KGB and went back to university.

After university, I went to work for Sobchak.

>From Sobchak, to Moscow and to the General Department.

Then to the Presidential Administration.

>From there, to the FSB.

Then I was appointed Prime Minister.

Now I'm Acting President. That's it!"

Putin's first two claims: that he's lived "...a very simple life" and that
his life is "...an open book"; are set together to imply they're
synonymous. They're not, of course; dull men may do evil, secret things. In
fact, dull men are much better suited to dirty work. If you're looking for
an assassin or a bagman, you'd hardly advertise for sensitive, high-strung
intellectuals. You'd want phlegmatic dullards like Putin. 

Putin's gift for dullness as a survival strategy seems to have been
inherited. While claiming that his family has always been "very ordinary,"
he mentions with pride that his grandfather, a cook, "...was transferred to
one of Stalin's dachas [and] worked there for a long time." Putin adds that
"for some reason they let [my grandfather] be. Few people who spent much
time around Stalin [survived], but my grandfather was one of them." Putin
then suggests the key trait which enabled his grandfather to survive: "My
grandfather kept pretty quiet...My parents didn't talk much about the past,
either." For three generations, then, this "very ordinary" family survived
in a lethal environment, protected by their dullness and silence. 

Putin opens up only when talking about the Second World War. In this, as in
most of his accounts, he is simply repeating the Soviet pattern. The USSR
always preferred to focus on the Great Patriotic War, not only because
Russia's war was truly heroic but because events before and after it were
not exactly "an open book," and certainly not a book most people cared to
open. 

As Leon Aron did in his recent Yeltsin biography, Putin or his handlers use
his obscure childhood to insert little details designed to appeal to
various focus groups. He nods to Jews in the audience by claiming to have
spent as much time with his elderly Jewish neighbors as he did with his own
parents, then fawns on the Christians with this transparent bit of
cross-waving: "When I was born...my mother had me baptized. They kept it a
secret from my father, who was a party member...Many years later...I went
to Israel as part of an official delegation. Mama gave me my baptismal
cross to get it blessed at the Lord's Tomb. I have never taken it off since."

Putin the Devout. And why not? Courtesy costs nothing, as the saying goes.
Repeated often enough, such stories may even be believed. No doubt the
ikons of the twenty-first century will feature Putin's blank, fishy face
backed with a nimbus. But Putin's devotion was clearly more focused, in his
youth, on another object of worship: the KGB. 

It might seem a bit awkward, interviewing the head of a very scary state
about his decades as a spy, especially about whether he did any spying as
an undergraduate at LGU. It wasn't entirely unheard-of for Soviet students
to do a little freelance snitching on their schoolmates. The journalists
construct a question allowing Vladimir Vladimirovich to make a simple denial:

"So you didn't collaborate with the KGB while you were an undergraduate?"

Putin hits it out of the park: "They didn't even try to recruit me as an
agent..." adding, for the sake of verisimilitude, "...although it was a
widespread practice at the time."

As Putin tells it, the KGB politely waited until he graduated before
proposing to him. And Putin could hardly contain his joy at being asked: "I
had dreamed of this moment since I was a schoolboy." So Putin, the blushing
bride, marries "the agencies."

This is a sticky moment for the journalists. The KGB, after all...it's not
quite like working in a shoestore.... They realize they have to ask
something...some sort of 'conscience' question. Here's the one they serve up.

"And when you agreed to work for the agencies, did you think about 1937?"

This is just the sort of pitch Putin likes: low and inside. He sends it
flying: 

"To be honest, I didn't think about it at all."

This reply could actually serve Putin for the answer to all questions which
don't involve names and dates. This, you begin to suspect, is the quality
which makes this gray little man so useful to the people running Russia: "I
didn't think about it at all."

In order to give Putin's KGB career the proper spin, he and the three mice
interviewing him use the "old hardliners vs. young reformers" story
line--which, as Matt Taibbi pointed out in a recent eXile, can be applied
to any set of characters in Russia. Here's the summary provided at the
beginning of the chapter summarizing Putin's KGB career:

"After a stint in Counterintelligence with some stodgy hard-liners, Putin
is sent to the Andropov Red Banner Institute in Moscow for additional
training. The officers quickly take notice of the smart and unflappable
trainee. He's offered a spot in the most coveted of divisions: foreign
intelligence. Meanwhile, he meets a stunning airline stewardess, Lyudmila.
He impresses her with hard-to-come-by tickets for three nights at the
theater, procured through his KGB connections. Their courtship lasts three
years. They marry and are transferred on Putin's first assignment abroad:
Dresden, East Germany."

It's the old Hollywood formula: Boy meets KGB, boy marries KGB, boy meets
stewardess and lets her come along for the ride. It's very clear from
Putin's narrative that Lyuda came a rather distant second to his career as
a spy. But was Putin any good as a spy? He was assigned to East Germany,
after all. This was rather like a Mormon missionary getting assigned to
Utah: not exactly a challenging environment. Putin himself remarks on his
surprise at finding, in the DDR, the "totalitarian state that Russia left
three decades before." 

And what, exactly, did he do? Putin's response emphasises dullness: "It was
very routine work." Dullness uber alles! His only response to the collapse
of the DDR in 1989 is annoyance at "the way [demonstrators] expressed their
protest," It was, he says, "upsetting." 

In the "upsetting" world which emerged on the death of the USSR, Putin's
bland obedience was put to work in some very murky dealings, first with
Sobchak and later with Yeltsin. But don't expect to learn anything about
those years from this book. Putin and his wife (who's brought on-stage to
give us "the real Putin") spend pages describing the day their dacha
burned, what happened to their first dog, and Lyuda's car accident--but
Putin has absolutely nothing to say about what he did in Petersburg. This
is a typical exchange: 

"When Sobchak flew to Paris, where were you?"

"In St. Petersburg...

"Tell us about it."

"What's to tell?"

What indeed. A man who could make the spy game seem duller than running an
autobody shop has no trouble graying up any narrative whatever. Putin
describes his rise through the corrupt Yeltsin hierarchy as something in
which he had no part at all. When asked how he was made head of the FSB,
his answer is "The President simply signed a decree." And how did Putin
learn about his promotion? Purely by accident: "Kirienko...said, 'Hi,
Volodya! Congratulations!' I said, 'What for?' He said, 'The decree is
signed. You have been appointed director of the FSB.'"

The pattern becomes almost comical after a few chapters. The journalists
ask Putin about his place in some event, and he either denies that it took
place at all or, if that's impossible, claims he happened to stumble in
purely by accident, and against his will. Did Putin know he was being
considered for the Premiership? "No, it never entered my mind." Did the FSB
bomb those apartment buildings in Moscow? "What! Blowing up our own
apartment buildings?"

You start to wonder how Putin would deal with other events. Putin on a TV
cooking show, explaining how to bake a cake: Putin walks backwards onto the
set, bumps into the counter, exclaims, "What's this? Flour? Eggs? A mixer?"
Putin turns to the camera, a tear in his eye: "It's clear they expect me to
produce a cake! Akh, what else can I do?" 

Strange that so crude a production should be so effective. But the book is
doing its job, as a quick look at its Amazon listing demonstrates. Some
fool Canadian actually makes a parallel between Putin and Lincoln. It's
stunning to realize that the world is pretty much like Goodfellas, and the
moral of the story is the one de Niro tells the young Henry Hill: "Never
rat on your friends and always keep your mouth shut." And someday you may
be President of Russia.

******

#12
ANALYSIS - Outlook for Russian bank reform grim
By Julie Tolkacheva

MOSCOW, July 7 (Reuters) - Almost two years after Russia's 1998 economic 
crisis the political will to reform the banking system is lacking, analysts 
said on Wednesday. 

``In Russia, bank system restructuring is more a political matter than an 
economic one. It will take (President Vladimir) Putin throwing some of his 
political weight behind it,'' said Alexei Zabotkine, an economist at UFG 
brokerage. 

Although more than $1 billion of debt was successfully restructured at one of 
Russia's biggest bank's this week, analysts said this was the exception that 
proves the rule. 

UNEXIM Bank, which was severely hit by the 1988 crisis, said it would 
restructure its debts in an amicable deal with creditors. 

That was good news for the still-tottering sector, but restructuring depends 
on the political will of President Vladimir Putin to build a responsible 
system and block asset stripping rather than rely on friendly deals. 

Under the UNEXIM restructuring plan, creditors will get $105 million in cash, 
$130 million in a Eurobond issued by Rosbank, set by UNEXIM to secure its 
assets, and $1.15 billion in notes based on a trust of UNEXIM assets. 

``This is a landmark transaction,'' Fleming UCB, financial adviser to UNEXIM, 
said in a statement. ``UNEXIM Bank is the first to have achieved a purely 
commercial, voluntary restructuring.'' 

Ludmila Khrapchenko, a banking analyst at Alfa-Capital, said it was unusually 
successful deal. 

``This is one of the rare cases when an agreement was achieved and something 
was left of the bank,'' she said. She estimated creditors got about 20 cents 
on the dollar. 

The banking system was destroyed by the 1998 rouble devaluation and the 
government's default on its rouble treasury bills. Khrapchenk said the 
remaining assets at many banks had been stripped, so there was nothing for 
creditors to negotiate over. 

Russian legislation allowed such stripping to take place and put creditors 
last on the list of claimants to assets, she said. 

``An amicable agreement is the only way out for them. If the bank is declared 
bankrupt, they get nothing,'' she said. 

GOOD PLAN, SMALL CHANCE OF IMPLEMENTATION 

The government approved an 18-month economic programme last week which 
envisages shoring up the banking system by increasing regulations, oversight, 
competition and setting up a legal framework for liquidating troubled banks. 

It appears to be just what the industry needs. But like many programmes in 
Russia, the key is to implement it, and years of previous failures have made 
analysts sceptical. 

``The plans are good, but I have not yet seen any concrete steps,'' said 
Vladislav Metnyov, a banking analyst at Aton brokerage. 

Although banking reform is part of the programme, Putin will be occupied with 
more urgent problems like reining in powerful regional governors and tackling 
tax reform. 

``Since the president cannot have a million fights with everyone, the banking 
system (reform) will be put off,'' Zabotkine said. 

Eventually Russia will have to have good banks to facilitate borrowing from 
those with money to lend to those without so capital is available to fund 
growth. Such banks barely exist. But as the economy is growing strongly, with 
an 8.4 percent rise in gross domestic product in the first quarter, reforms 
will have to be introduced eventually. 

``There is no acute necessity. But it will appear when companies have 
exhausted financial resources of their own and when the problem of getting 
bank credits becomes very acute,'' said Andrei Ivanov, a banking analyst at 
Troika Dialog. 

That would be in a year or two, he said. 

CENTRAL BANK HAS KEY ROLE 

With or without a government plan, the main burden of reform may lie on the 
central bank, which has lead many analysts to suggest that a change of 
management is needed. 

``The key question of whether there will be any kind of a progress at all is 
whether faces are changed at the central bank,'' said Kim Iskyan, an analyst 
at Renaissance Capital. 

Central Bank Chairman Viktor Gerashchenko has kept the rouble steady but has 
made little real progress with bank reform. 

UFG's Zabotkine said he feared restructuring could be put off too long: 
``Restructuring must start next year, otherwise the ineffectiveness of the 
financial system can become a serious obstacle for economic development in 
2002.'' 

******