September 28, 2000    
This Date's Issues: 4543• 4544 •4545

Johnson's Russia List
#4545
28 September 2000
davidjohnson@erols.com


[Note from David Johnson:
1. Reuters: Putin chat with Solzhenitsyn sparks liberal fears.
2. Financial Times (UK): Andrew Jack, Council of Russia's governors 
to gain new powers.
3. AFP: Chechen warlords doggedly resist Russia's rule.
4. Reuters: Russian war reporter asks media to monitor trial. 
(Babitsky)
5. Jamestown Monitor: SWISS COURT AND PROSECUTOR BATTLE OVER FREEZING 
MABETEX ACCOUNTS.
6. Moscow Times: Yevgenia Albats, Do We Really Believe Putin Has No 
Clue? 
7. Andrew Yorke: Re: "And the Winner Is" MT/Elections (JRL 4500).
8. Dimitar Getov: Kursk - Re: Dale Herspring jrl 4538.
9. Newsbytes: Brian Krebs, Leaders Tout Plan To Make Russia An 
E-Commerce Player.
10. gazeta.ru: Kremlin Postpones Kursk Recovery Operation.
11. Robert Bruce Ware: Reply to Blank and Herspring JRL 4542.
12. Moscow conference: Information Society and Intellectual 
Information Technologies in the 21st Century.
13. Izvestia: INCREASED DEFENCE SPENDING WON'T BENEFIT THE ARMY - 
LYUBOV KUDELINA. (Interview with Deputy Finance Minister Lyubov
Kudelina)]


******


#1
Putin chat with Solzhenitsyn sparks liberal fears
By Gareth Jones

MOSCOW, Sept 28 (Reuters) - Politics often makes for strange bedfellows, 
nowhere more than in Russia where a decade of giddy change has erased old 
loyalties and upset cherished beliefs. 


In such a context, there seems nothing especially odd about a former officer 
of the KGB, ``sword and shield'' of the Bolshevik revolution, paying a 
courtesy call on Alexander Solzhenitsyn, chronicler of the Gulag and scourge 
of Soviet communism. 


But for some commentators, last week's visit by ex-KGB agent Vladimir Putin 
to the 81-year-old writer marks a watershed in the Russian leader's efforts 
to define his political philosophy. 


They say Putin, both by temperament and by his KGB training, is attracted to 
the kind of conservative, even authoritarian ideas espoused by Solzhenitsyn, 
who has become as stern a critic of the new capitalist Russia as he once was 
of Soviet communism. 


The Itogi weekly even speculated wryly that Solzhenitsyn might become the 
kind of inspiration and promoter for Putin that socialist writer Maxim Gorky 
once was for Soviet state founder Vladimir Lenin. 


``Putin can't expect backing from the liberal intelligentsia so he is turning 
towards the ``national-patriotic'' forces,'' said political analyst Yevgeny 
Volk of the Heritage Foundation. 


``National-patriotic'' is a catch-all post-Soviet term encompassing much of 
the political spectrum from pious Orthodox traditionalists like Solzhenitsyn 
to diehard Marxist-Leninists. They all share a strong aversion to the new 
pluralistic Russia. 


``There is a sort of battle going on for Putin's mind, but at the moment the 
liberals seem to be losing,'' said Volk. 


Putin has kept people guessing about his underlying beliefs since taking 
office, but has stressed the need to rebuild the authority of the state and 
to ensure that laws are properly enforced while also pledging to press on 
with market reforms. 


Solzhenitsyn, not normally given to praising politicians, certainly seemed 
impressed by what he heard from Putin. 


``I want to stress his cautious and carefully weighed decisions and 
pronouncements,'' the bearded sage told state RTR television after their 
meeting. ``He is genuinely and wholly involved in the interests of public 
affairs.'' 


CRITIC OF MODERN RUSSIA 


This was quite a turnaround for Solzhenitsyn, who like some Biblical prophet 
routinely lambasts the materialism of modern Russian life and derides its 
democracy as shallow and flawed. 


Two years ago, Solzhenitsyn returned an award bestowed on him by Putin's 
predecessor, Boris Yeltsin, saying he could not accept it from leaders who 
had driven Russia into poverty. 


But here he was drinking tea and chatting happily at his dacha in a Moscow 
suburb with Putin, the man hand-picked by Yeltsin last year to succeed him. 


Anatoly Chubais, standard bearer of Russia's post-Soviet liberalism and 
architect of the country's controversial privatisation programme, predicted 
several months ago that Putin would initiate such a rapprochement with 
Solzhenitsyn. 


Chubais noted that Solzhenitsyn's writings provided intellectual ammunition 
for Putin in his battle with the ``oligarchs,'' a small band of men who built 
up huge fortunes in the post-Soviet era through their political connections. 


Vladimir Gusinsky, owner of Russia's independent media empire Media-Most, and 
Boris Berezovsky, who also owns various media outlets, have both fallen foul 
of Putin in recent months. 


Political analysts say Putin's offensive against Russia's regional bosses 
also dovetails neatly with Solzhenitsyn's agenda. The writer has often warned 
of centrifugal forces tearing the vast country asunder. 


Putin has carved Russia into seven super-regions headed by representatives, 
mostly drawn from the security forces or army, who answer directly to him. 


With its echoes of the tsarist-era governors-general, this move was sure to 
please a conservative like Solzhenitsyn, who has long argued that Russia 
should look to its own past, not to inappropriate Western models, to resolve 
its problems. 


``It is no accident that Putin has gone courting Solzhenitsyn. They see eye 
to eye on many issues, and Putin feels a certain ideological deficit in his 
programme,'' said Andrei Ryabov of the Carnegie Endowment for Peace 
think-tank. 


PUTIN THE PRAGMATIST 


But Ryabov added that Putin was essentially a pragmatist who would look to a 
variety of sources for inspiration and support. 


Analysts noted that Putin had also recently invited Mikhail Gorbachev, the 
former Soviet leader and darling of the West, to the Kremlin. More 
surprisingly, he held talks with the editors of the Communist daily 
Sovietskaya Rossiya and of the ultra-nationalist weekly Zavtra paper. 


``Putin is neither pro-communist nor anti-communist. He is post-communist. He 
will listen and consult with all sorts of people. It is part of the process 
of this country re-evaluating its own past,'' said Ryabov. 


Analysts said meetings with men like Solzhenitsyn did not mean Putin was 
turning away from liberal reforms. 


Ryabov compared Putin with Pyotr Stolypin, Tsar Nicholas II's pre-World War 
One prime minister whose conservative views did not prevent him launching 
far-reaching reforms, including land reform, religious freedom, tax reform 
and national insurance. 


Boris Makarenko of the Centre of Political Technologies agreed about Putin's 
pragmatic approach to politics. 


``Putin has no ideology. Yes, he respects Solzhenitsyn and is happy to share 
ideas with him. But he will not take advice from him,'' Makarenko said, 
adding that he expected no review of 1990s privatisation deals as urged by 
the writer. 


******


#2
Financial Times (UK)
28 September 2000
Council of Russia's governors to gain new powers
By Andrew Jack


Russia's upper chamber of parliament is likely to lose many of its powers
to a new consultative body of the country's regional governors, the head of
the St Petersburg administration said yesterday. 


Vladimir Yakovlev, the governor of Russia's second largest city, stressed
in an interview his support for the creation of the new State Council, a
consultative body which most governors welcome, but which some analysts see
as a threat to the democratic role of the Federation Council, the upper
chamber. 


The changes represent a new step in President Vladimir Putin's efforts to
curb the powers of Russia's 89 regional governors, following introduction
of laws this summer that will strip them of the right to sit in the
Federation Council by the start of 2002, and strengthen the Kremlin's
ability to dismiss them for acts judged to be illegal. 


Mr Yakovlev's comments represent further confirmation of the growing role
planned for the State Council, which was originally designed as a
consultative body to compensate the governors for the loss of their seats
in the Federation Council. 


"Our conversations with Mr Putin have confirmed that in order for the State
Council to be legitimate, we have to change the constitution," said Mr
Yakovlev. "A number of the functions of the Federation Council may be
transferred to it." 


While stressing that detailed proposals still had to be drawn up, he
suggested that the new council could be given the right to review laws,
including the federal budget; the approval of senior state officials such
as the general prosecutor and high court judges; and the resolution of
conflicts between Russia's different regions. 


Critics of the reforms argue that they are anti-democratic, with the
elected governors replaced on the Federation Council by their own
non-elected nominees. They say the governors will be far more directly
under the control of Mr Putin in the State Council, which he will chair
himself. 


******


#3
Chechen warlords doggedly resist Russia's rule


MOSCOW, Sept 28 (AFP) - 
A dozen warlords are masterminding the Chechen rebels' dogged resistance to 
Russia's army, staging regular ambushes and mine attacks in a bitter 
guerrilla war that could drag on for years.


The most famous is Shamil Basayev, 35, hero of the first war of independence 
(1994-1996), author of spectacular raids and a leading adherent of the 
radical Islamic philosophy which exerts great influence in rebel ranks.


But Basayev has not been on the frontline since he was amputated above the 
knee in February, after stepping on a landmine when fleeing the besieged 
capital Grozny.


Along with his deputy Khattab, 33, a radical Islamic Wahhabite of Jordanian 
or Saudi origin, he has some 700 fighters under his orders who include Turks, 
Arabs or Chinese ethnic Uighurs.


Khattab, who fought in the name of Allah in Afghanistan and Tajikistan before 
coming to Chechnya, is accused by Moscow of masterminding with Basayev a 
series of terrorist bombings in 1999 which killed 293 people in Russia.


One of the most active warlords is Issa Munayev, 38, "military commander of 
Grozny," who along with his 300 men operates clandestinely in the capital's 
shattered ruins.


His units scored a coup in August by blowing up a polling booth in Grozny 
surrounded by federal forces, killing four Russian soldiers and two Chechens.


The most audacious Chechen commander, and the most undisciplined, is Ruslan 
Gelayev, 39, who briefly recaptured several localities near Grozny, without 
the permission of Chechen President Aslan Maskhadov.


Besieged for three weeks in March by the Russians at Komsomolskoye, his 
native village in southern Chechnya, Gelayev and his men just managed to 
escape in time and take refuge in the mountains.


The head of the Chechen secret services, Turpal-Ali Atgeriyev, 31, has a 
specific role: he commands units tasked with executing "collaborators," 
Chechens who work for the pro-Russian administration.


A dozen have been killed over the past six months.


The ministers of the interior and defence, Aidamir Abolayev, 40, and Magomed 
Khambiyev, 35, in charge of the eastern front, say they have 1,000 fighters 
at their disposal.


Arbi Barayev, 24, who claimed responsibility for several operations against 
the Russians this summer, is the most controversial of the warlords.


A recent convert to Wahhabism, he is suspected of playing a major role in the 
wave of kidnappings for money that swept Chechnya after the last 1994-96 war 
that led to de facto independence for the secessionist republic.


He has been linked to the abduction of several foreigners, most notoriously 
three Britons and a New Zealander found decapitated in 1998.


Many Chechens view him as a Russian agent, saying there is no other 
explanation for why he is able regularly to travel to neighbouring Ingushetia 
despite army checkpoints, and return unhindered to his home village of 
Alkhan-Kala, near Grozny, which is under Russian control.


All these warlords recognise, at least formally, the authority of their 
commander-in-chief, Maskhadov.


But they have a large degree of autonomy, with the president only deciding 
the general outlines of the rebel campaign against the Russians, guerrilla 
sources say.


The Chechen pro-independence fighters have 1,500 men under arms, according to 
the Kremlin, and 15,000 according to the rebel side which stresses it has the 
support of a large section of society.


The Russians have more than 80,000 soldiers in Chechnya, according to the 
Kremlin's chief spokesman on the conflict, Sergei Yastrzhembsky.


******


#4
Russian war reporter asks media to monitor trial

MOSCOW, Sept 27 (Reuters) - A lawyer representing war reporter Andrei 
Babitsky, detained by Russian forces in rebel Chechnya earlier this year, 
asked the media on Wednesday to subject his forthcoming trial to the ``glare 
of truth.'' 


Babitsky, a reporter for U.S.-funded Radio Liberty, was involved in a 
mysterious prisoner exchange in January and is due to be tried next Monday 
for carrying false papers in a region neighbouring Chechnya. 


Lawyer Genri Reznik, sitting alongside Babitsky, told a news conference the 
trial was just the latest example of the state's ``arbitrary'' treatment of 
the reporter. 


``We want openness...so the whole court understands it is in the glare of 
truth and openness,'' Reznik said, asking reporters to attend the trial in 
Makhachkala, in Dagestan region. 


Babitsky angered the Kremlin with his reports from behind rebel lines inside 
Chechnya. Following his detention, the Kremlin released footage of a 
purported prisoner swap in which Babitsky was handed to rebels in exchange 
for captive soldiers. 


A month later, after an international outcry, he surfaced in Makhachkala, was 
arrested and charged with carrying false identity documents. 


Babitsky's disappearance raised concerns about freedom of the press among 
liberal politicians and human rights groups. 


His trial comes amid new debate about press freedom after Media-Most, which 
controls much of Russia's independent national media, said it had been forced 
to agree to cede its independence by handing shares over to a 
state-controlled creditor. 


Reznik said the charge against Babitsky was unlikely to land him in jail, but 
that it was nonetheless trumped up. 


Reznik and Babitsky said the prisoner exchange had been staged. Babitsky 
repeated assertions that he was held by Chechens with links to the FSB 
domestic security service and only freed when President Vladimir Putin 
personally intervened. 


Reznik said media attention was the only way to maximise the chances of a not 
guilty 


******


#5
Excerpt
Jamestown Monitor
September 27, 2000


SWISS COURT AND PROSECUTOR BATTLE OVER FREEZING MABETEX ACCOUNTS.... 


In a related development, a Russian newspaper reported last week that in 
early 1996, the company Golden ADA Incorporated, which subsequently became 
the target of an investigation in Russia into the alleged illegal 
exportation of hundreds of millions of dollars in diamonds and precious 
metals, purchased eighteen plots of land near Lake Tahoe in the United 
States, along with automobiles and yachts, for eighteen people from then 
President Boris Yeltsin's inner circle. According to the paper, two of 
those eighteen are also among the fourteen mentioned in Devaud's letter to 
Russian Prosecutor General Ustinov. The paper noted that these purchases 
took place at a time when Yeltsin's poll numbers were extremely low and it 
was not clear that he would win his bid for re-election in the summer of 
1996. The paper, citing records from FBI investigations in San Francisco, 
where Golden ADA was headquartered, also reported that "commissions" from 
deals the company made were deposited in bank accounts in Switzerland, the 
Caribbean, Finland, Ireland and the United Kingdom, and that Golden Ada had 
transferred some US$400,000 through the Kremlin's "Fund for Presidential 
Programs," ostensibly for the publication of an American edition of 
"Zapiski Presidenta," the second installment of Yeltsin's memoirs 
(Moskovskie novosti, September 19).


******


#6
Moscow Times
September 28, 2000 
POWER PLAY: Do We Really Believe Putin Has No Clue? 
By Yevgenia Albats 


President Vladimir Putin has said he won't intervene in the conflict between 
Gazprom and Media-MOST. That's good. Citing Mikhail Gorbachev, who met with 
Putin as head of NTV's public council, Putin said he "had no clue" about the 
state's interference in the deal between the two private entities, and he was 
outraged by the behavior of Press Minister Mikhail Lesin. That's bad. 


Should we believe this? If so, then Putin doesn't control his ministries, 
doesn't know what is going on in the country's largest monopoly and has a 
vague understanding of how things are done in Russia. 


This merely adds to other such instances when Putin happened to have "no 
clue." The nation should be concerned: Aren't we in trouble? Do we really 
have a president? If the man in whom the majority has invested the right and 
might to govern it has no clue, who does? But the nation apparently is not 
eager to ask such questions. Is it because our gut tells us that all these 
incidences of "had no clue" are nothing but badly performed self-defense? 


Let me throw out a couple of ideas. 


Shortly after Putin's successful presidential campaign, in which NTV was his 
main opponent, Alfred Kokh was appointed the new head of Gazprom-Media. Kokh, 
the onetime privatization minister, had never been involved in any 
media-related businesses. But Kokh was known as a bitter, personal enemy of 
Media-MOST, which in 1997 did its best (not as a media outlet, but as a 
competitor) to disclose some of Kokh's misdoings as a bureaucrat. Kokh was 
investigated but escaped a sentence on a clemency basis. Question: Why has 
Gazprom, with its many professional financial managers, employed Gusinsky's 
personal rival to retrieve its debts? Guess: This wasn't Gazprom's choice, 
but the choice of the Kremlin, which has ways to ensure that Kokh will break 
his back to resolve the dispute so that NTV can be controlled. 


For years, Gazprom has wailed about its lack of cash to pay to the federal 
budget. During the same period, the monopoly's financial problems have not 
allowed it to pay dividends to shareholders at an amount any more than, for 
instance, 3 kopeks per share in 1997, the year of the nation's best economic 
performance. Still, according to independent consultants on the 
Gazprom/Media-MOST deal f and according to Kokh himself f Gazprom was 
prepared to pay Gusinsky much more than NTV's estimated price and to impose 
on Gazprom's fragile shoulders the mountainous burden of all of Media-MOST's 
current and future debts. Question: If this is just a commercial deal between 
two private businesses, why the generosity? Why was Gazprom so eager to make 
a deal that was so financially unprofitable for it? Guess: This has little to 
do with business, but lots to do with politics. 


Just as Gazprom was pressed to "buy" a stake in NTV after the 1996 
presidential elections (in which NTV performed a service not so much to the 
public as to the authorities), so Gazprom is trying to provide another favor 
to the Kremlin. Well-informed sources speculate that in fact Gazprom would 
not lose any money on the deal, but taxpayers will; the monopoly's expenses 
would be compensated by a forgiving of some of its customs duties. 


Aren't these questions enough to allay your fears that Putin "had no clue?" 


Yevgenia Albats is an independent journalist based in Moscow. 


******


#7
Date: Thu, 28 Sep 2000
From: Andrew Yorke <y@fremder.demon.co.uk>
Subject: Re: "And the Winner Is" MT/Elections (JRL 4500)


Ploughing through my JRL backlog, I finally came to The Moscow Times
report on fraud in Russia's recent elections, which is indeed a great
piece of journalism. Forgive me if I've written here something that's
already been posted in the 3 weeks since the MT article. The writers of
that piece do miss a fairly obvious point, and I can't help thinking
they deliberately overlooked it because they didn't want to lessen the
impact of their story.


The MT writers place the blame squarely on the Kremlin for the
occurences of voter fraud, but it is quite clear from the evidence cited
by the MT that fraud was directed by individual governors and republican
presidents in the most corrupt and least democratic regions of Russia.
Doubtless the Kremlin was encouraging this behind the scenes, but there
is little evidence of their direct involvement in fraud.


After the parliamentary elections it became clear that Putin was going
to be the next president, and the governors panicked, coming to the
conclusion that unless they were seen to deliver a sizeable vote for
Putin in their region, they might lose their privileged status vis-a-vis
the Kremlin. The regional leaders were the key players in the recent
federal elections, precisely because Yeltsin had allowed them to grab so
much power and independence during his time at the Kremlin. Edinstvo and
O/VR were first and foremost governors' parties, and neither party was
in the slightest bit scrupulous about which regional leaders were
allowed in. The key was to co-opt as many as possible, and the most
authoritarian leaders were the most valuable as they were capable of
delivering the best election results through fraud and manipulation.


The classic example of this phenomenon is Tatarstan. Shaimiev, who rules
Tatarstan in a less than democratic fashion, was at the forefront of the
Vsya Rossiya movement in the parliamentary elections, which along with
Luzhkov's Otechestvo formed the main opposition to Putin's Edinstvo.
After Otechestvo/Vsya Rossiya fared badly in those elections, Shaimiev
realised that he would have to change his spots, and ordered his minions
to ensure that Tatarstani voters delivered a resounding vote in support
of the acting President.


In Kursk, governor Rutskoi became a supporter of Edinstvo despite having
previously been a member of a different group under the same name - the
abortive 1998 "Edinstvo" movement founded by none other than Yuri
Luzhkov. Of course Rutskoi had been no friend of the Kremlin's ever
since he masterminded a failed coup attempt (along with Ruslan
Khasbulatov) against Yeltsin. Nevertheless he was welcomed into Putin's
"Edinstvo". Whatever his private thoughts about those in power in the
Kremlin, Rutskoi became convinced that Edinstvo and Putin would win the
elections. With his own governor's post up for elections in autumn 2000,
Rutskoi decided his best chance of survival would be to support
Edinstvo. He delivered a vote of over 50% for Putin, leading Zyuganov to
accuse Rutskoi of falsifying the results on RTR. However, Putin and
Edinstvo have not shown the gratitude that Rutskoi expected in return
for his achievements. Things started to go wrong on February 26 at a
Edinstvo party congress, where Rutskoi's criticisms of the party led to
deathly silence and a rebuke from Sergei Shoigu. Edinstvo has since
decided to support Rutskoi's rival, Viktor Surzhikov, in the forthcoming
Kursk gubernatorial elections.


In Primorskii Krai, another region cited by the Moscow Times, governor
Nazdratenko is one of the most controversial in Russia. His region is
almost paralysed: by corruption, crime, power-cuts and the battles
between Nazdratenko and his opponents - the most famous of whom is the
former mayor of Vladivostok, Viktor Cherepkov. Like Shaimiev and
Rutskoi, Nazdratenko has a highly dubious track record and has for a
time been affiliated with O/VR. In May 1999, Nazdratenko announced on
the radio that he was backing Evgeny Primakov, but before the December
Duma elections he realised that Primakov would lose, and equally
enthusiastically announced that he was backing Putin. On the same day as
the Duma elections, Primorskii Krai held elections for the post of
governor which Nazdratenko won. His main opponent complained about the
conduct of the elections to the Kremlin, and subsequently ended up in a
car-crash which some say appeared less than accidental [Yevgenii
Popravko in the Russian Regional Report, V. 5, n. 1]. Nazdratenko's
relations with Putin suffered a blow when he failed to deliver a
substantial pro-Putin vote in the presidential elections. Instead,
Zyuganov did sensationally well, perhaps because the public was
disgusted with Nazdratenko. Nazdratenko's battle with his arch-enemy
Chubais continues, but in general it seems the Kremlin is still broadly
supportive of his leadership. It apparently backed Nazdratenko's
victorious candidate in the Vladivostok mayoral elections.


In all three of the regions mentioned above, the regional leaders
switched their allegiance from O/VR (or, in the case of Rutskoi, from
Luzhkov's previous party) to Edinstvo in order to ensure their survival
in the post-election political landscape. It is hard to believe that
they would have carried out honest and clean elections had they remained
in O/VR, and I doubt that all the fraud that did take place was carried
out in favour of the Kremlin. What is more, the Kremlin has since been
distancing itself to some extent from some of the less savoury regional
leaders who support it.


******


#8
Date: Wed, 27 Sep 2000 
From: "Dimitar Getov" <getovd@appletonnet.com> 
Subject: Kursk - Re: Dale Herspring jrl 4538
Since so many opinions were published in the list on whether the Kursk was
sunk in a collision accident - and most by people with apparently no
military background - I decided to mail you my five-cents-worth of thoughts
on this issue, hoping to engage someone with more knowledge and desire to
respond and enlighten us all. It seems to me a bit unrealistic to have
"Russian incompetence" taken so readily for granted. Also, it sounds as if
Mr. Herspring and so many before him take this way too personally and write
as if the very suggestion of a collision is an insult to everything
American. All kinds of bizarre stories were concocted by the media with
such a speed that it was hard to keep track but this is understandable.
What isn't, is why would so many people venture opinions so authoritatively
when it is clear that they have no understanding of military technology.

Here is a list of questions that I'd be delighted to have answered by
someone with a serious background in naval engineering or the military. I
think if these are answered the picture will become clearer for all:

1. Is it correct to assume that if the US conducts detailed satellite
surveillance of Russian naval exercises - the question of whether the Kursk
as sunk by a torpedo launched by mistake from a battle cruiser will be
answered asily? 
2. Is it correct to assume that no one uses live conventional charges to
shoot at their own sub during an exercise?
3. Is it correct to assume that given the validity of assumption #2 it
is incredibly unlikely that someone would just switch the charge and this
will remain unnoticed?
4. Is it correct to assume that there was no "testing (of) a new torpedo --
one which used very volatile hydrogen peroxide -- and it did not work." (as
Mr. Herspring suggests) because I am looking at a bottle of hydrogen
peroxide right now which costs 55 cents at Osco Drug and is used (according
to the label) for treating minor cuts?
5. If indeed there was a test - who was the torpedo manufacturer in Russia
and why has there been absolutely no mention of them? 
6. How realistic is the statement that the only thing one can tell about a
sub hull is the color? What can one possibly discover about a sub by
looking at the hull from a distance other than whether it has a large dent
in front or not?
7. What can the Russians possibly gain by lying about the causes of the
disaster - I mean really!? 

******


#9
Leaders Tout Plan To Make Russia An E-Commerce Player
By Brian Krebs, 
Newsbytes
WASHINGTON, D.C., U.S.A.,
25 Sep 2000, 2:38 PM CST


A delegation of lawmakers from Russia's executive and legislative branches 
are making a concerted effort to highlight some of Russia's recent e-commerce 
initiatives in a US tour this week, touting a five-year plan they say would 
make Russia a contender in the global e-commerce market. 


Addressing a press conference in Washington, DC, this morning, Ivan 
Nikolayevich Kurnosov, deputy director for information technology at the 
Ministry of Telecommunications and Information Technology - Russia's 
equivalent of the US Federal Communications Commission (FCC) - said this year 
marks the first time the executive branch had made the development of 
information technology a "top priority," both financially and legislatively. 
Kurnosov said the ministry had prepared a federal plan to foster the creation 
of the appropriate infrastructure for a thriving e-commerce market, a program 
that would run from 2001 to 2006. 


"We think by the end of this period, the position of Russia in terms of 
e-commerce will meet the requirements of the international e-commerce 
market," Kurnosov said, speaking through an interpreter. 


Kurnosov offered few specifics on the five-year plan, saying only that the 
plan would focus on increasing the security and reliability of payment, 
credit, and banking systems for e-commerce. Kurnosov said so little 
information was available about the plan because, while Russian President 
Vladimir Putin has tentatively proposed one measure of the plan called the 
security doctrine, the Duma legislative body has yet to approve it. 


"It's a little premature to give you an overview of what our doctrine is 
going to be all about, because it's not done yet and all of the parties are 
still arguing the issues," Kurnosov said. "But there are discussions about 
doctrine itself, and we anticipate a heated debate and discussions about the 
issues." 


The Russians also have made it a goal to have a computer and Internet 
connection in every school, a feat even the US has yet to accomplish. 
Kurnosov called e-commerce the most dynamic sector of Russia's new economy, 
noting that the number of Russian e-commerce Web sites, magazines and Web 
users has doubled each year since 1997. At present, he said, more than 500 
Russian-run e-shops bring in approximately $1 million each year. 


Oleg Aleksandrovich Finko, a third-term member of the state Duma, Russia's 
lower house of parliament, said Russia is currently faced with the same 
questions that American legislators are wrestling with. Namely, whether to 
pass new laws aimed at securing the budding e-commerce industry or to leave 
it alone and let the free market govern which companies win or lose. 
Finko said the Duma was also working to pass new laws governing the use of 
digital signatures, following the passage of similar laws in the US this 
summer. 


Both the Duma members and the cabinet officers played up the Russian 
government's interest in new e-commerce initiatives, and spoke in very broad 
terms about their country's plans for increasing the Internet's economic 
potential for all Russians. 


But few specifics were offered on just how the government plans to build 
communication infrastructures that would reach the 100 million residents in 
some of the most remote and poorest regions on the planet.


Instead, Finko and other Duma members of the delegation said they were here 
to learn strategies from the best in the business, and to "make good use of 
US (companies') best accomplishments in e-commerce." 


Over the next few days, the Russian delegation will meet with Rep. James 
Moran, D-Va., and other members of Congress, as well as David Bain, president
of GIST Inc., a company that provides interactive TV listings and content for 
companies like MSN, Yahoo!, IMDb, Alta Vista, NBC Interactive, CNN 
Interactive, iWon, and USA Today. Backbone provider UUNET will also host the 
delegation at their Network Operations Center in Virginia. 


The delegations are the last of approximately 140 members of the Russian 
parliament that have visited the US over the past few months as part of the 
Library of Congress' Open World 2000 Russian Leadership Program. 


*******


#10
gazeta.ru
September 27, 2000
Kremlin Postpones Kursk Recovery Operation

The government commission, headed by deputy Prime Minister Ilya Klebanov,
investigating the cause of the Kursk nuclear submarine tragedy has
successfully done everything in their powers to stall the first stage of
the operation to recover the bodies of the dead submariners. On September
26th, the date scheduled for the recovery operation, there were no signs
that an operation is imminent. 


At a session on Tuesday morning, the government investigators
unexpectedly decided against concluding a deal with the Norwegian company
Stolt Offshore. 


Back in August, four days after the Barents Sea tragedy, the Stolt Offshore
experts joined the rescue operation. It was the Norwegian professionals who
managed to do what the Russians could not; they opened the submarines hatch
and established there were no survivors on board the sunken vessel. Perhaps
we shall never know whether there would have been any survivors to rescue
had the Russian leadership requested their services four days earlier. 


Representatives of the Rubin Central Marine Design Bureau, who were the
first to announce the unexpected decision not to sign a contract with the
Norwegians, refused to reveal the true reason behind the decision. 


Stolt Offshore only said that they had predicted such an outcome from the
painfully hard negotiations that dragged on for nearly a month. 


Details of the decision adopted by Ilya Klebanovs commission emerged late
on Tuesday afternoon. The Rubin Marine Design Bureau has launched talks
with a number of other firms which will probably take part in the operation
to recover the bodies of the Kursk crew members, the deputy chief of Rubins
foreign economic department Gennady Sorokin told the RIA Novosti news agency. 


In the course of those talks the parties will discuss financial,
technological and administrative issues, insurance and safety guarantees
for divers. The Rubin representative said the Russian side must choose the
cheapest and most efficient technologies from those offered by foreigners. 


Our goal is to choose a variant that would be most appropriate for Russia,
said Sorokin, and added that Rubins chief engineer Igor Spassky is keeping
deputy PM Klebanov posted on all details concerning the preparations for
the rescue operation. 


But, Sorokin refused to name the other companies that had apparently
dissuaded the Russian government from signing a deal with Stolt Offshore. 


The chances are, such companies simply do not exist. After all, Stolt
Offshore is one of the worlds leading offshore service firms that boasts a
team of professional deep-sea divers. 


During and after Stolt Offshores involvement in the operation to rescue the
Kursk crew, Russian Navy officials and governmental investigators
repeatedly acknowledged that Stolt Offshore experts were the best in the
world in their field, and that is why about two weeks ago the Russian
government formally requested the Norwegian Foreign Ministry to allow the
company participate in the operation to retrieving the bodies of the Kursk
crew members. 


And now, after all sides concerned had announced that all the terms and
conditions of the agreement had been coordinated and agreed upon, Russia
has suddenly pulled out of the deal with Stolt Offshore. 


On September 25th news reports emerged that the sides had agreed not only
on the long-disputed contract price of $13 million, but also on specific
details of the operation and the Norwegians were allowed on board a vessel
of the same type and model as the Kursk for training purposes. 


It is likely that the abrupt decision not to sign a contract with Stolt
Offshore, is due to president Putins deciding not to launch an operation
to recover the bodies of the Kursk crew this year. Recently some relatives
of the dead submariners said that an operation to retrieve the submariners
should not be launched unless the lives of the rescuers were 100% safe and
that for the time being, in accordance with an ancient naval tradition, the
perished sailors should be left where they are. 


At the end of August the Atomic Ministry announced that the submarine would
not be lifted this year. What is more, the Atomic Minister Adamov warned
that lifting the sub could pose a danger of a radiation leak. Adamovs
statement was refuted as non-patriotic soon afterwards, but it seems that
now the Kremlin has decided to give his proposal another thought. 


It is highly likely that come next summer, Klebanov' commission will find
some other proof of the inexpediency and danger of attempting to lift the
sub, or the submariners relatives will request that their perished loved
ones be permanently left on the bed of the Barents Sea. 


In that case, unless the government and navy declassify the video footage
they claim is evidence that the Kursk collided with a foreign vessel, many
in Russia will continue to believe that the sub was destroyed either by a
torpedo launched from the Russian destroyer the Pyetr Veliky, or by a
faulty missile fired by the Kursk itself. 


Andrey Matyash
*****


#11
Date: Wed, 27 Sep 2000 
From: "Robert Bruce Ware" <rware@stlnet.com> 
Subject: Reply to Blank and Herspring JRL 4542

Irony, I believe, is the appropriate response to condescension. I hope
that we can now dispense with both.


The issue of our debate is neither the mendacity of the Russian military,
nor the veracity of American assurances. On these points we have always
been in complete agreement. Nor do we differ in the preeminence of our
concern for the national security of the United States. The only point of
disagreement concerns the manner in which our national security is best to
be obtained. Over the past two years relations between Russia and the
United States have seriously deteriorated. Whatever the Russian
responsibility for this
deterioration, I believe that much of it might have been avoided by wiser
American policies. The present matter is contributing further to that
deterioration if only because it permits Russian military leaders to blame
the United States in order to save themselves. Perhaps we should not play
intotheir hands. I regard the atmosphere of increasing suspicion,
recrimination and hostility between Russia and the United States to be, by
far, the most serious threat to our national security. Despite continuing
presumptions about my background I appreciate concerns about military
security. However, I remain convinced that any possible threat to our
national security that might result from a mutually acceptable
(non-Russian) materials engineer examing a couple of submarines is minor in
comparison with that threat which is posed by rapidly
increasing resentment in Russia toward the United States. Sometimes
security is served by secrecy; sometimes it is served by candor. Isn't
that precisely the reason why Russian officials were allowed to observe our
strategic missilefacilities on the eve of the millennium? 


*******


#12
Date: Wed, 27 Sep 2000 
From: Alexander Domrin <domrin@pc-club.ru> 
Subject: Conference in Moscow


The British Council in Russia and First Socio-Engineering Park "Future
Russia", with the support of the Federation Council of the Federal Assembly
of the Russian Federation, Ministry of Industry, Science and Technology of
the Russian Federation, Mission of the Russian Federation with the European
Council, Russian Research Institute of Artificial Intelligence, Regional
Investors Club, National Academy of Intellect and Social Technologies, the
International Methodological Association, the Union of Russian Legislators,
the Institute of Europe of the Russian Academy of Sciences, the Russian
Association of the Club of Rome, the Parliamentary Newspaper and a number
of other state, public, scientific and commercial organizations, are
holding an International Conference and Exhibition "Information Society and
Intellectual Information Technologies in the 21st Century".


The conference is dedicated to the analysis of global processes of
informatization of human society and their connection with the latest
developments in information technology. Conference participants will give
their views and recommendations for the future.


The conference will focus on the following issues:
1. The social, political, economic, legal and humanitarian problems facing
the development of the information society in the 21st Century.
2. The technological basis of the information society in the 21st Century:
Internet, telecommunications and mass media of the future; Artificial
intelligence, computers in the 21st Century; Electronic commerce;
Intellectual information technologies in science, industry, management and
finance, education, culture and public health services; Internet and Law.


Leading up to the conference, there will be several international Internet
forums to discuss current problems in this sphere. Due to the format of the
conference and exhibition, there will be a limit of 100 participants.
They will include the most authoritative scientists from Russia and abroad,
science and industry leaders, top Russian politicians, representatives of
federal and regional authorities, the heads of leading Russian and foreign
companies, developers and manufacturers of telecommunications equipment,
computers and software,
investors and top figures from the mass media.


The Conference will take place in March 2001 in the Federation Council of
the Federal Assembly of the Russian Federation. Further information about
the date, venue, registration and participation is available on the website
of First Socio-Engineering Park "Future Russia" at
www.futurerussia.ru .
(The English version is under construction).


Organizing Committee:
Eugeny Smirnov, Co-Chairman of Organizing Committee -
tel.: (+7 095) 754-5315; e-mail: Future_Russia@turandot.ru
Elena Bouianova, Manager - tel./fax: (+7 095) 241 2330, 241 1082
Address: 121002, Moscow, Maly Nikolopeskovy per, 3.


******


#13
Izvestia
September 27, 2000
[translation from RIA Novosti for personal use only] 
INCREASED DEFENCE SPENDING WON'T BENEFIT THE ARMY - LYUBOV 
KUDELINA
Over the last four years, ever since she was put in charge 
of the Finance Ministry's army financing, Deputy Finance 
Minister Lyubov Kudelina has been arguing with the Defence 
Minister that it should live and serve within its means. The 
latest draft of a defence document, too, has caused quite a 
flurry both in the State Duma and in society. For some, 
military spending in 2001 is outrageously low, for others, it 
is outrageously great. The golden mean, it seems, is known only 
to Lyubov Kudelina. 

Question: Ms Kudelina, a few words about how a defence 
budget is put together today. As far as I know, this is a 
well-regulated procedure, unlike in previous years. 
Answer: Quite right. With the introduction of the Budget 
Code, the system of determining army expenses has changed.
Earlier, the Defence Ministry used to ask its own sum, which 
only later was brought somehow in line with federal budget 
parameters.
Now our departing point is the state's capabilities. We first 
calculate tax take, our revenues and ways of dealing with the 
budget deficit and much else, and only then we tell every 
department, the Defence Ministry included, what amount of 
financing it can expect in the next fiscal year.

Question: And what has been proposed to the military?
Answer: Initially, in April, the Defence Ministry was 
given a figure of 160 billion roubles to base its calculations 
on. Then we examined their request and realised that the sum 
would only suffice for basic pay, food and clothing. That is, 
as before, the budget would be spent on maintenance, rather 
than help strengthen the armed forces. In the end we found a 
way of increasing spending to 199 and later even to 206 billion 
roubles.

Question: Did the Defence Ministry accept this figure?
Answer: Yes, because it was joint work, involving 
specialists from the Finance Ministry, other interested 
departments, and, of course, army financiers.

Question: Then why does history repeat itself: as soon as 
a draft budget makes it to the Duma, the Defence Ministry 
begins talking of increasing it?
Answer: You see, we have no doubts about the accuracy of 
our calculations. We, incidentally, for the first time 
introduced an item-by-item estimate, proceeding from the number 
of servicemen, and food, clothing and other norms. We made 
estimates for utilities payments and fuel procurement. That is, 
we abandoned the fallacious practice of first naming a target 
figure in the budget and then indexing it. But the Defence 
Ministry worries that -- following the pattern of the previous 
years - its current expenses might be largely taken up by 
repaying its credit indebtedness. By the beginning of this year 
the military establishment's debts to utilities, defence plants 
and other suppliers had been 60 billion roubles (almost half of 
the Defence Ministry's annual budget in 2000). We have already 
been able to repay 15 billion roubles on state defence orders, 
and by November are planning to pay off food debts - 5.5 
billion roubles.

Question: That leaves 40 billion... 
Answer: And that is why, most probably not later than the 
middle of October, the government will decide to take over the 
Defence Ministry's debts upon itself. Besides, before the end 
of the year we are hoping to cover part of the debt with extra 
revenue. But one thing is certain: there will be no mutual 
netting of debts. 

Question: If the state assumes all the Defence Ministry's 
debts, that cardinally changes the structure of military 
expenditures. There is the possibility of spending more on the 
development of arms and equipment and on military science. Do 
you think this news will make the State Duma give up its 
intention to increase the military budget by 30 billion roubles 
as a minimum?
Answer: Deputies have the right to raise questions the way 
they see fit and proper. I only want to emphasise that today we 
are counting literally every rouble. The Finance Ministry is 
only too aware of what follows when the budget is pumped with 
"virtual money." In 1994, you may recall, a lack of real cash 
compelled cancellation of some of state orders. In 1996-1997, 
financing was so meagre that money sufficed only to pay cash 
allowances, and moreover to one-third of servicemen. When I 
hear the military say today that more funds should be allocated 
under this heading, I agree with them, but we should 
nevertheless proceed from the country's economic capabilities. 
The 206 billion roubles is real money backed by revenue. All 
the rest is from the Evil One. 

Question: Everyone hopes for petrodollars, for high oil 
prices. Hence greater-than-usual expectations of extra revenue. 
Answer: Everyone counts up future receipts, but no one 
counts up future expenses. This year, for example, Russia 
failed to secure the external borrowings it bargained for. This 
and other factors have created the problem of how to handle the 
defence budget as well. The problem, however, will be solved, 
because a balance of revenue and expenditure for this year was 
determined in general correctly. If in 2001 this balance is 
upset with unbacked billions, we may well find ourselves in a 
situation when there is no money to pay cash allowances, to say 
nothing of other items.

Question: Cash allowances. A sore subject. A lieutenant 
starts off with 1,500 roubles. All the country already knows 
that the commander of a nuclear submarine is paid less than a 
trolleybus driver. And yet the next year's draft budget does 
not plan to raise pay for the military.
Answer: The military will get a 20 per cent hike from 
December 1 of this year. To my mind, this does not solve the 
financial problem of men in uniform. But, I repeat, we proceed 
from the state's possibilities. I think it is high time to 
substantially alter the system of pay for the military. A 
military man should receive as much as a civil servant, and 
also an additional sum for his service grade. And no food 
rations, lump-sum payments and other allowances. All of them 
should be covered by basic pay. 

Question: In 2001 the military will start paying an income 
tax - the first time ever ...
Answer: And there and then getting a compensation for it.

Question: But then, pardon me, what's the trick, with the 
state taking it with one hand and giving it back with the other?
Answer: This is a step towards a system which equates 
servicemen's incomes with those of civil officials. The 
compensation is planned only for 2001. Further on, everything 
will be according to general rules applying to civil servants.

Question: According to the General Staff, next year it is 
planned to retire about 100,000 men from the armed forces - is 
the budget prepared for that?
Answer: Yes, this item is included under the heading 
"Military Reform". No review of the financial allowances for 
the retirees is envisaged in the draft, although the government 
may decide to change the mechanism for paying allowances and 
other sums as provided for by legislation. For example, making 
all payments through Sberbank.

Question: Your opponents believe that defence spending in 
2001 remains the same as this year, because the Defence 
Ministry's budget now includes items that used to be financed 
under different departments. For example, financing 
peacekeeping operations has been moved from the section 
"International Activity" and financing the military reform, 
from "Special Budgetary Funds"...
Answer: We have merely put everything in their places, 
according to the Budget Code. Earlier these sums were allotted 
to the Finance Ministry, which all the same passed them on to 
the Defence Ministry. Now it will be done directly. But even if 
we discount, say, 12 billion roubles earmarked for peacekeeping 
activity of the armed forces, still the increase in military 
spending will be just under 60 billion roubles. The growth of 
the defence budget is obvious.

Question: The growth is obvious, but, to judge by 
everything, you as the one responsible in the government for 
defining military expenses are far from sure that even this 
sizeable chunk of the federal budget will be used to develop 
national defence, aren't you?
Answer: There cannot be any talk of development, I think, 
until we adopt and start implementing an arms programme until 
2010. The interim arrangement is that we will invest in 
repairing weapons and equipment. And also in military science, 
designing weapons of new generations. From 2005, when designs 
are launched into mass production, we will begin purchasing new 
military hardware and equipment.

Question: For the time being you are accused that the 2001 
defence budget does not provide funds for the purchase of lots 
of what the army sorely needs. Why not make the budget more 
transparent and not open up as many of its items as possible 
(not just six, as is the case now) so that everybody could see 
where the taxpayers' money goes?
Answer: I do not think that from a military point of view 
it is advisable to make our defence spending transparent, as 
was the case in the early 90s. A UN estimate, which we fulfil, 
and a detailed classification of military expenses are not one 
and the same thing. Also, transparency of military spending 
would aggravate lobbying, which would complicate normal work on 
the budget. I am sure that many items should remain closed. It 
is a different matter that from time to time society needs to 
make some comparative analysis showing where the money goes in 
the army. But not more.

Question: Is the Finance Ministry now in control over cash 
flows within the army?
Answer: Unfortunately, not entirely. The managerial 
structures in the armed forces are too cumbersome. But with a 
treasury system introduced, I hope a lot will change. Such a 
system is already functioning in all power structures. Briefly, 
it is that all settlements of the military establishment should 
be made only via the federal treasury and not through 
commercial banks as was the case before. The Defence Ministry 
is slower than other power ministries in adopting the treasury 
system. To give an example. Remitted sums may remain in 
treasury accounts uncalled by the Defence Ministry for up to 
two or three weeks.
But, I hope, this problem will be resolved as well. 

(Interview Taken Down by Vladimir YERMOLIN) 


******