This Date's Issues: 4605 •4606
Johnson's Russia List
28 October 2000
[Note from David Johnson:
1. Interfax: RUSSIAN 'ELITE' NEARLY EVENLY SPLIT AS TO HOW RUSSIA
SHOULD DEVELOP - POLL.
2. Moscow Times: Kevin O'Flynn, Book Shows Putin's Special Moves.
3. Reuters: Writers, politicians and actors denounce Putin.
4. Reuters: Rights groups condemn journalists' lot in Russia.
5. Dale Herspring: Dedovshchina in the Russian Military.
6. Stephen Blank: Russophobia.
7. Interfax: RUSSIA TO ASK FOR IMF LOANS ONLY IN ECONOMIC DOWNTURN.
8. The Guardian (UK): Putin piles on super-tsar pretensions.
9. Foreign Affairs REVIEW ESSAY: Daniel Treisman, Blaming Russia
First. Three Books Examine Russia's Woes. (Cohen, Freeland, Klebnikov)]
RUSSIAN 'ELITE' NEARLY EVENLY SPLIT AS TO HOW RUSSIA SHOULD DEVELOP -
MOSCOW. Oct 27 (Interfax) - The opinions of those in the Russian
'elite' as to what path the country should follow in its development are
divided, with 42.3% of them believing that Russia should follow the path
of the "civilized" developed countries, and 54.8% thinking that the
country has its own unique development path to follow.
These figures were derived from a poll of 500 representatives of
elite Russian groups conducted by the independent Russian Public Opinion
and Market Research center (ROMIR-Gallup International) in late
The survey of 500 representatives of Russian executive and
legislative power structures, business and state enterprise management,
scientific and media circles was conducted in ten large Russian cities.
The poll also showed that, with the division of opinions as to what
path Russia should follow, the majority of the Russian elite (73.5%)
believe that Russia possesses sufficient internal resources to deal with
its problems without needing assistance from foreign countries, while
19.6% are in doubt about this.
October 28, 2000
Book Shows Putin's Special Moves
By Kevin O'Flynn
Russia's leaders have filled bookshelves and bookshelves with their
scribblings. Lenin wrote prodigiously, Stalin wrote badly, Leonid Brezhnev
pretended he could write, and now President Vladimir Putin has joined the
literary line with his first book.
Just don't expect an insight into his political philosophy or the answer to
whither Russia. But if you want to know how to block a man coming at you in a
kimono with a knife in his left hand, then "Judo: History, Theory, Practice"
is the book for you.
Co-written with two longtime judo friends, Vasily Shestakov and Alexei
Levitsky, the book was published in Arkhangelsk last week.
The 154-page glossy book is not your usual Russian sports manual. Printed in
Finland, it is a high-quality, glossy edition worthy more of a coffee table
than a tatami mat.
But the book f priced at a hefty 250 rubles (about $9) and with a print run
of 20,000 f is a comprehensive study of the martial art and obviously aimed
at committed judo fans.
Indeed, it would require a very committed Putin devotee to take an interest
in the detailed pie charts on the most frequent throws or the mathematical
equations that measure the quality of an opponent's defense such as:
Sixty pages of illustrations showing the techniques for the best ways to
throw and drop an opponent fill most of the book. It is written in a plain
style you might expect of Putin with headings such as "Defense against a blow
to the side of the head" or "Assailant attacks you with a knife from below
(knife in right hand)," but literary critics hoping to pick apart the prose
of the president will be sorely disappointed because none of the text is
The hot-selling tabloid Komsomolskaya Pravda tried to liven up its story on
the book by reprinting an illustration, found on page 77, showing a hold that
involves grabbing your opponent between the legs.
Shestakov, who is the head of a sports complex in St. Petersburg, said he
co-wrote the Practice part of the book with Putin, while Levitsky wrote the
History and Theory sections.
"The first grips that are shown, they are his [Putin's] special moves þ those
he demonstrated in Japan," Shestakov said Friday by telephone.
Putin visited Japan on a state visit in July. He said at the time that his
favorite move was the deashibari, a swift attack aimed at knocking an
opponent off his feet, although he still managed to be thrown by a young
Japanese girl, to the consternation of his bodyguards.
Shestakov, who like Putin is a master of sport and a qualified judo trainer,
said he has known the president since childhood.
"We've been together on the tatami since we were 14 years old," he said,
referring to the judo mat.
The idea for the book came up two or three years ago and the work has been
going on since then, he said.
"We met periodically and swapped notes and information and came to a general
opinion," said Shestakov, who said he still meets regularly with Putin.
The book is published by Severny Komsomolets, which also publishes a judo
magazine. Komsomolskaya Pravda said the book would bring the three authors
about $5,000 and they had decided to give the money to a children's sports
Shestakov, who is still professionally involved in the sport, said he
respects Putin's judo skills.
"In Japan they awarded him the sixth dan and gave him a red and white belt.
That's considered a very high level," he said. There are 12 levels of
proficiency, or dans, at the grade of black belt.
"If he hadn't left sports, I think he'd have had a lot of success," Shestakov
said, adding that Putin is better than he is.
In an interview before last December's parliamentary elections, he said Putin
was in great shape. "Not everyone is able to do 15 chin-ups in a row," he
said. "Vladimir Vladimirovich can."
But does a president have time to write judo books?
"In connection with his career in Moscow, things have become more difficult,"
Shestakov said. "But even so, sometimes he finds time and we go on the
Writers, politicians and actors denounce Putin
PARIS, Oct 28 (Reuters) - Almost 250 intellectuals, politicians and actors
published a petition on Saturday condemning Russian President Vladimir Putin
and the "dirty, cruel" war in Chechnya.
A day before Putin was due to arrive for a visit to France, the petition
called on European leaders to stand up and denounce what the Russian
authorities were doing in the breakaway Caucasus region.
"Every day young Russian soldiers are dying and 20 times as many Chechens --
first and foremost women and children," said the petition, published in Le
Among those who signed the open letter were Russian journalist Andrei
Babitsky, former European Union commissioner Emma Bonino, actresses Vanessa
Redgrave and Isabelle Adjani, U.S. writer Susan Sontag, Albanian author
Ismail Kadare and British historian Norman Davies.
The petition said Russia was a part of Europe and had to respect some basic
"No colonial wars, no civilian massacres, no racist cleansing. Mr Putin, it
is time to make clear to you that this applies to everyone, small and large
Criticism of the war in Chechnya has grown in the build up to Putin's
three-day visit to Paris, during which he is due to meet French leaders and
senior European Union officials.
Saturday's petition predicted that Putin would use the trip to repeat his
call for the West to support him in his battle against "international
"We are worried that despite the occasional disapproving murmuring, which
will soon be forgotten, knowing silence (from Western leaders) will only
reinforce his murderous convictions," the letter said.
"Crimes against humanity cannot be forgotten. Silence kills," it added. The
petition called on people to demonstrate in central Paris on Monday evening
against Putin and the war.
Russian forces have seized most of Chechnya in more than a year of savage
fighting, but Chechen rebels are still holding out in the mountainous south.
Rights groups condemn journalists' lot in Russia
PARIS, Oct 27 (Reuters) - Journalists covering the Chechnya conflict or
working in other areas of Russia face an increasing threat of violence, two
leading human rights group said on Friday.
Paris-based Reporters sans Frontieres and New York-based Human Rights Watch,
in a joint letter to French President Jacques Chirac, said six journalists
working in Russia or republics of the former Soviet Union had been killed
They did not directly blame Russia for the deaths, but asked Chirac to bring
up the matter when Russian President Vladimir Putin visits France next week.
"We would like you to remind the Russian head of state that threats (against
journalists) are incompatible with Russia's commitments as a democracy and
European power," they wrote.
The groups said Italian journalist Antonio Russo, who covered Chechnya from
Georgia, was found dead by a roadside near Tblisi on October 16 and another
journalist, Alexander Yefremov, was killed by a remote-controlled explosion
in Chechnya on May 12.
Radio Liberty journalist Iskander Khationi was found battered to death on
September 21, but no link has yet been made between his killing and his
investigations into human rights abuses in Chechnya, the letter said.
The three other journalists killed were Sergei Ivanov, shot to death in
Samara on October 3, Sergei Novikov, shot in Smolensk on July 26, and Igor
Domnekov, killed on July 16, the letter said. The human rights groups did not
link their deaths to the Chechnya situation.
The letter said two journalists engaged in investigative reporting about
corruption among high-ranking officials were injured by beatings this year.
Two others who covered Chechnya were beaten and, or arrested by Russian
troops, said the letter, adding that dozens of journalists suffered similar
treatment in the past.
"It is Mr Putin's responsibility to intervene personally to halt the general
deterioration of working conditions for journalists in Russia. It is the
responsibility of the European Union to remind him of this," the letter said.
Date: Fri, 27 Oct 2000
From: email@example.com (Dale Herspring)
Subject: Dedovshchina in the Russian Military
I found David Filipov's Boston Globe article on hazing in the
Russian military to be right on. What is worse, I see little chance
that it will change in the near future, and this is not only because of
a lack of money.
Money is certainly a factor -- having soldiers go hungry almost
always leads to a situation where the stronger (or Deds) prey on
the weaker -- those just entering the military. The same could be
said for other things such a equipment.
Furthermore, there is no question that discipline has almost
collapsed in the Russian Army. I just finished a paper that dealt in
part with the subject, and it is amazing that the Russian military
still functions at all when one considers the many problems it has
with discipline, corruption, drugs, health, food, the quality of
conscripts, training, etc.
The real source of the problem goes much deeper, however. Even
in the good old days of the Soviet Army, it was a problem. The
current problems noted above have only acerbated the matter.
The problem is command relationships -- and in particular, the
relationship between officers and men (and the lack of a trained
NCO corps). Officers don't want to get involved in a one on one
basis with the troops the way American or British officers do.
Furthermore, the Russian Army lacks the kind of a trained NCO
corps that is the backbone of the American or British militaries.
Furthermore, I personally have witnessed brutality on the part not
only of senior sailors against junior ones, but on the part of officers
vis-a-vis recruits. I can still remember being on board the Ustinov
and watching officers pick up sailors by their blouses and then
throw them against a steel bulkhead -- something that would lead
to dire consequences for an American or British officers.
I am not trying to question the military competency of Russian
officers. I have spent too much time with them for that. They know
their business. What they don't seem to know, however, is how to
treat their troops. Until this happens, until there is a strong NCO
corps, I doubt that dedovshchina will go away -- even if economic
Date: Fri, 27 Oct 2000
From: "Stephen Blank" <BlankS@awc.carlisle.army.mil>
Fortunately or unfortunately I've been too busy to read Lieven and his
critics on Russophobia until I found I was lumped in as a russophobe. Since
name calling never solves anything and betrays the character of the caller
more than the target, I only have a few words to say on this subject.
First, as Lieven should know the term Russophobe is essentially that of the
reactionary anti-Semitic Russian right, e.g. Igor Shafarevich, and should
be avoided at all costs by anyone who aspires to be an objective analyst.
Second, since many of my Russian friends like what I write, what does that
make them. Third, I doubt if Anatol has read everything I wrote where he
can say that I have nothing good to say about Russian policy anywhere.
Judging from people like Pavel Felgengauer, Peter Reddaway, etc.. (you can
choose hom you like here) I am in good company. My emotions in this matter
are I hope on the side of the Russian people who have been regularly
traduced by their leaders for far too long a time. If one wants to defend
the Russian response in Chechnya, e.g. on the grounds that there was a real
threat to neighboring provinces that is absolutely correct. But the
decision to use force in the way it has been done, i.e. guerre a'l outrance
or total war is the height of strategic irresponsibility and can only be
understood in terms of corrupting the election process in 1999-2000, saving
Yeltsin and the elite, and intra-military policies. What all of try to do
in this field is, pace Spinoza, not to weep, not to laugh, not to bless or
curse but to understand. Sadly none of us has yet risen to the level of
those analysts' virtue who can call everyone who disagrees with them
Russophobes or tools of Moscow or some other sobriquet and thus dispense
with the requirement of making sense of what has happening. If and when I
and the other luminaries whom Lieven sees fit to tar with this brush of
outraged Russian reactionaries reach his level, then I and they can call
those who disagree with us names too.
RUSSIA TO ASK FOR IMF LOANS ONLY IN ECONOMIC DOWNTURN
MOSCOW. Oct 27 (Interfax) - Russia plans to resort to financial aid
from the International Monetary Fund only in the event of an economic
downturn spurred by external factors, Deputy Prime Minister and Finance
Minister Aleksei Kudrin said.
The possibility of a loan from the IMF will be discussed during
negotiations with a mission from the Fund that is due to arrive in
Moscow on November 7, Kudrin said on Friday.
The main topic of these talks with be Russia's program with the IMF
for the next 18 to 24 months, he said.
Russia will also raise the issue of possible lending from the IMF
in the event of "a deterioration in the economic situation in the
country due to external reasons," Kudrin said.
Commenting on the amount of possible borrowing from the IMF, Kudrin
said the figure under consideration is $1.8 billion in 2001. The amount
of borrowing in subsequent years "will be a subject of negotiations," he
But if the economic situation in Russia remains stable "we may not
need such a loan from the IMF," Kudrin said.
The Guardian (UK)
28 October 2000
Putin piles on super-tsar pretensions
Russia's bigwigs just can't leave Red Square alone. From Ivan the Terrible to
Joseph Stalin and Boris Yeltsin, the megalomaniacs peering out of their
Kremlin office windows have made most famous public space in Russia their
Ivan bequeathed the square St Basil's Cathedral, the fairy-tale confection
that graces its eastern end. The communists placed the colossal Hotel
Rossiya, an outstanding specimen of the brutalist school of architecture, on
one edge and Lenin's mausoleum smack in the middle at the Kremlin wall.
Mr Yeltsin spent hundreds of millions from public funds on dodgy contracts
refurbishing the Kremlin to make it fit for a latterday Tsar. The cost ran to
£500m - about £10,000 a square yard. Two new winter gardens for the
presidential residence were a snip at £6m each.
Not to be outdone, Vladimir Putin too wants to make his mark. For a poor boy
who grew up in a communal flat, spending his play-time hunting rats in the
stairwell, Mr Putin has quickly developed a taste for the grandiose.
His aides have been scouring the country for an appropriate presidential
equivalent to Chequers or Camp David. Not content with the multimillion-pound
country piles of the Russian elite which go by the deceptively modest name of
dachas, they have come up with a sumptuous but crumbling 18th-century
Italianate palace outside St Petersburg, which is to be renovated for the
first family at a cost of tens of millions of pounds
Along with his Kremlin residence and dacha, Mr Putin is also said to be
considering a new family home in one of the most des-res parts of central
But it is the Red Square "Kremlin Centre" which is raising eyebrows in Moscow
and provoking sniggers about the latest folie de grandeur planned by the
social climbers in the Kremlin.
They envisage it rising beside St Basil's at an estimated cost of £200m, an
estimate that will inevitably prove too little by half. In a revealing slip
of the tongue, the Kremlin property boss, Vladimir Kozhin, first put the cost
at £200bn. The centre is to include a luxury hotel, a diamond and precious
metals auction centre, bijou boutiques hawking Russian antiques, etc. Exactly
what Russia and Red Square need.
This is not the brainchild of some international consortium or crooked
Russian "oligarch". No. It's the Kremlin's idea. But rather than tell the
voters about it first, Mr Putin's people took the madcap idea to Boston,
stunning a retinue of Russian businessmen and MPs by unveiling a slideshow of
Red Square architectural plans to potential American investors.
By the stroke of a pen in 1993 Mr Yeltsin created the Kremlin property
department, incorporating all the real estate that had belonged to the
communist party: an unimaginably huge empire of holdings at home and abroad
worth more than $400bn. The chap who ran this empire for Mr Yeltsin was Pavel
Borodin, whom the Swiss would like to arrest if they could get their hands on
him and who gave a first job in the Kremlin to a young ex-KGB officer from St
Petersburg - Vladimir Putin.
Mr Kozhin, a crony of Mr Putin from St Pete, was appointed in January with a
cost-cutting brief. Fat chance. By the summer, he and his team were looking
for £1.4bn in foreign investment to enhance the empire, some of it so that Mr
Putin can leave his imprint on Red Square.
[for personal use only]
Blaming Russia First
By Daniel Treisman
Daniel Treisman is Associate Professor of Political Science at the
University of California, Los Angeles. He is the author of After the
Deluge: Regional Crises and Political Consolidation in Russia.
Three Books Examine Russia's Woes
Failed Crusade: America and the Tragedy of Post-Communist Russia. By
Stephen F. Cohen. New York: W. W. Norton, 2000, 320 pp. $21.95.
Sale of the Century: Russia's Wild Ride from Communism to Capitalism. By
Chrystia Freeland. New York: Crown Business, 2000, 352 pp. $27.50.
Godfather of the Kremlin: Boris Berezovsky and the Looting of Russia. By
Paul Klebnikov. New York: Harcourt Brace, 2000, 353 pp. $28.00.
Pity the unpopular Russians. In July, Mexico elects its first president
from outside the country's ruling party; The Economist magazine labels it a
"real democracy." Russia elects a president from the political opposition
in 1991, then holds no fewer than five competitive, generally free,
national elections in the following years; The Economist calls it a "phony
democracy." Colombia has a problem with organized crime, and Washington
gives its government $1.3 billion to help fight the drug lords. Russia also
has a problem with organized crime, and American politicians sternly
lecture Moscow not to expect any more aid until it cleans up its act. An
undercover U.S. operation finds several Mexican banks laundering drug money
in the United States, and Washington apologizes to the Mexicans for
conducting sting operations on their territory. An American bank allegedly
launders money for Russian organized criminals, and a leading senator
accuses the Russian government of being "the world's most virulent
kleptocracy." When the Asian crisis scares investors away from the
Brazilian market and the real collapses, commentators declare it a bump in
the road. When the Asian crisis scares foreign investors away from the
Russian market and the ruble collapses, commentators declare the crash
proof of the failure of liberal economic reform in Russia.
That many Russians these days see a double standard in Western opinion
toward their country is perhaps not altogether surprising. As readers of
the Western press know, there are no businessmen in Russia, only mafiosi;
no democrats, only corrupt politicians; no citizens, only an impoverished,
nationalistic mass. Members of the emerging Russian middle class are often
discouraged to learn, upon picking up Western papers, that they do not yet
It has not always been this way. As Stephen Cohen points out in his new
book, the Western press was overwhelmingly supportive of Boris Yeltsin and
his attempts at reform in the early 1990s. But around 1998, a sea change
occurred. Without acknowledging any change of position, Western editorials
switched from a guarded optimism about Russia's reforms to a withering
condemnation of all associated with them. The scales fell from the
Political and economic developments in Russia in recent years have
certainly been disappointing. It is fashionable to point this out. But the
current gloom about Russia is as overdone as was the optimism of the early
1990s. The obstacles blocking full democracy and well-functioning markets
have always been extremely forbidding -- but never unsurmountable.
Successes have always mixed with failures, the good with the bad. Perhaps
Western opinion will eventually come to recognize this, but at the moment
the frustrations of the naive optimists are joining up with the
schadenfreude of the confirmed pessimists to produce a public discourse on
Russia that is dyspeptic, often hypocritical, and almost completely lacking
in comparative perspective. These three recent books, in different ways and
to different degrees, illustrate this inadequacy.
A NEOCLASSICAL CRUSADE
What the optimists and the pessimists have in common is the hunger for a
villain -- the urge to cast the story of Russia in the 1990s as a simple
morality tale of good and evil, promise and betrayal. They tend to differ
in whom they cast in the role of villain, but the structure of their
arguments is similar. Cohen, a professor of Russian studies and history at
New York University, has been a confirmed pessimist since before it became
fashionable. His analysis of Russia in the 1990s is simple and (since he
repeats it continually throughout his new book) easy to follow. The Soviet
Union in 1991, he argues, was a successfully reforming state. Most of the
essential social and economic institutions "were still intact." This
functioning system was destroyed by an American political crusade to
transform postcommunist Russia into a "replica of America." The
"missionaries and evangelists" in this crusade were so-called economic
"advisers," usually from Harvard or the International Monetary Fund (IMF).
This invasion by Western crusaders preaching "tight-fisted monetarism"
resulted in the impoverishment of the Russian population, a drastic fall in
life expectancy, and the "demodernization of a twentieth-century country."
By letting Jeffrey Sachs and others of his ilk "swarm" across the Russian
plains, Cohen charges, the Clinton administration has done more damage to
U.S. interests than did the war in Vietnam.
Some readers may enjoy this book's dramatic language and unabashed Old
Testament wrath. But as an account of Russia in the 1990s, the argument
has, to say the least, more than a few holes. The oddest of all is Cohen's
suggestion that the Soviet Union in late 1991 was a well-functioning,
reforming state. To anyone who spent time in Russia that year, this claim
is completely surreal. By autumn, even privileged Muscovites were standing
in line for hours to buy bread. The elite stores, as Chrystia Freeland
tells us in her book, had little to offer their nomenklatura clientele
other than bags of millet. Only four months' worth of grain reserves
remained, and fear of famine that winter was widespread. Before Yeltsin's
reformers even touched the controls, Soviet industrial output had fallen by
17 percent in 1991 alone. Even before price liberalization, inflation in
Russia in 1991 was more than 160 percent. Russia's general government
deficit (including import subsidies and extrabudgetary funds) was almost
one-third of GDP. The central planning and supply system had been decimated
by Mikhail Gorbachev's perestroika, and enterprise directors were stripping
assets with abandon through the semiprivate cooperatives that Gorbachev had
Although they appeared bold, the dramatic reforms of late 1991 and early
1992 -- freeing prices, liberalizing trade, and initiating privatization --
were actually a brave face put on the central state's alarming impotence.
Yeltsin's lieutenants might have tried to hold off freeing prices and
privatization for another year or two, as Ukraine did. But Ukraine's
subsequent inflation and asset stripping were even more severe than
Russia's. There was certainly at that time an element of economic dogma in
the Kremlin's policies and an unmistakable note of free-market ideology in
the way they were presented. But the reformers' motivation owed at least as
much to desperation.
Were these policies imposed from outside by the crusaders from Harvard and
the IMF? The image of Sachs waltzing into the Kremlin to preach the true
gospel of Friedrich Hayek is a romantic one. With all due respect to Sachs,
however, most people who have met him would not cast him as the Pied Piper
of Hamlin. He is smart and articulate enough, but there cannot be many
Russian children who would follow him over a cliff, entranced by the
beautiful tunes he whistles. Besides, the Russian leaders were grownups.
Yegor Gaidar had read Adam Smith and Paul Samuelson long before the Harvard
gang came to call. Yeltsin, although anxious for Western respectability,
was first and foremost a politician; he was won over to the gospel of
monetarism for little more than an afternoon.1
Particularly troubling in Cohen's interpretation is his apparent assumption
that the Pied Pipers from Harvard brainwashed not just the Russian
leadership but much of the country's population. As he points out, there
were alternative economic programs -- for instance, those of the
Communists. But he neglects to add that most voters repeatedly rejected
candidates who espoused such programs. From April 1993 -- when 53 percent
of voters said in a referendum that they supported Yeltsin's social and
economic policies -- to the presidential election of March 2000, antireform
politicians and their positions have been consistently defeated at the
polls. Cohen rightly notes that the media is often biased and manipulative,
but former Soviet citizens are used to reading between the lines. Similar
pro-incumbent attacks backfired in 1993 and 1995, when the "parties of
power" under Gaidar and then Prime Minister Viktor Chernomyrdin failed to
get even 20 percent. And even Cohen notes that in 1996, despite minor
falsification of votes, "no serious observers doubted that Yeltsin had
actually won." Yet if rational, adult voters chose such candidates knowing
the economic policies they favored -- and in all cases except perhaps
Vladimir Putin they clearly did -- what do the snake-oil salesmen from
Harvard really have to do with it? Were they mass hypnotists as well as
economic missionaries? Were Russians too young and gullible to handle
There is also something vaguely undemocratic about Cohen's demand that the
United States change tack and organize an international coalition to
provide Russia with $500 billion in aid. (He says he got this figure from
"a Russian economist admired for his moderation and good sense.") Although
Western nations would be wise to invest more in preventing instability in
the world's second nuclear power, the American public has made it
absolutely clear in polls that it rejects anything approaching this figure.
Should the Clinton administration and Congress be faulted for respecting
FACING THE FACTS
The economic shock in the 1990s was undeniably severe, and industrial
output has fallen sharply. But does this amount to Russia's
"demodernization"? Statistics suggest a more complicated picture. In 1990
about one in six Russian families had a car; by 1998 about one in three
did. In the same eight years, an additional 32,000 kilometers of road were
built. Access to home telephones increased by 40 percent, and the number of
international telephone calls grew by a factor of 12. The share of the
population with access to three or more TV channels increased from 36 to 68
percent. Infant mortality, after rising in the early 1990s, was lower in
1998 than at the start of the decade.
Such statistics are the domain of economists, and Cohen makes clear he is
neither an "economist" nor an "adviser" (although he seems to have quite a
bit of advice to offer). He is a historian, and he feels that a sense of
history has been missing from the discourse on Russia: "Though it is no
longer fashionable to say so in the social sciences ... political,
economic, and social realities are shaped by a historical process."
To Cohen, being a historian means emphasizing continuity -- "Russia cannot
jump out of its skin" -- and reminding the reader of Russia's authoritarian
traditions and lack of experience with private property. But it is not
clear quite what he wants practical politicians to do with this knowledge.
In the latter case, he seems to be saying that Western policy should
support reform plans that aim at a mixed economy rather than advocating
American-style liberalism. Presumably he does not mean that Western
politicians should also favor traditional authoritarian institutions in
Russia rather than democracy.
Cohen is good at skewering journalists who muff their facts when racing for
deadlines and take their opinions from the herd. It is entertaining in a
sadistic sort of way to see him give the poor hacks a good poke in the eye.
(He butters them up in advance by recalling that he once turned down a job
as Moscow correspondent.) Stupidities have been uttered and written by many
people, including key Russian reformers and their Western advisers, and
Cohen does a good job of collecting them.
But leaving aside such dubious pleasures and the excitement of overheated
rhetoric, this is pretty arid stuff. The book contains almost no direct
descriptions of things Cohen has seen in Russia and few conversations with
individuals -- the exception is Gorbachev, who gets some direct quotes.
After many allusions to "every political figure we met" and "most Russian
foreign-policy specialists," one longs for a concrete name, face, or story.
Nor are there anecdotes or comparisons from the country's history except a
brief allusion to Russia's "time of troubles." The same cliches turn up in
chapter after chapter. One winces on being told for the ninth time about
Russia's "accursed" question, "Who is to blame?" The argument itself does
not develop. Almost all the essential points of Cohen's condemnation of the
Russian reformers and their Western supporters appear in a reprint of an
article from March 1992 -- just a few months after the reformers entered
office. Cohen apparently views this as evidence of prescience, but one
wonders how open-mindedly he has observed events since then.
In the end, the book makes depressing reading, although not for the reasons
Cohen imagines. Its author is a scholar of undeniable talent who published
the best book around on the Bolshevik leader and Marxist theorist Nikolai
Bukharin. For a generation of younger Russia specialists, his writings on
the Brezhnev and early Gorbachev periods were an inspiration. Unlike many
academics, he was able to see the change under the surface and grasp the
hidden vibrancy of late-Soviet society. He is clearly sincere in his
concern for Russia and the Russians. There were many ways he could have
used his impressive gifts to illuminate Russia's evolution during the last
ten years. They are not evident in the book he ended up writing.
To characterize Freeland as a naive optimist is a little unfair -- she is
much smarter than that label suggests. But she did go to Russia with high
hopes, and her narrative is colored by obvious frustration at seeing them
disappointed. Sale of the Century is a very different sort of book from
Cohen's. Its author was the Financial Times' Moscow bureau chief from 1995
to 1998 and the Kiev correspondent before that. Her account is well written
and lively, and one has to be impressed by the energy with which its author
pursued and cultivated a large selection of the leading economists,
politicians, and businessmen of fin-de-siËcle Moscow. There are wonderful
vignettes of the main "oligarchs" and a few fascinating glimpses of
ordinary Russians. She memorably notes that what struck her about the
"oligarchs" was not their Rolexes and the $100,000 fur coats for their
wives but the fact that they all seemed to be "looking for emergency
exits"; the threat of government prosecution or even assassination by
rivals always lurked in the background. The vivid and colorful reporting is
generally excellent, punctuated with some stories that even close Russia
watchers will not have read.
On the other hand, a few sources might be more clearly provided. Some
anecdotes seem to be taken directly from the embittered memoir of Yeltsin's
disgraced bodyguard, Aleksandr Korzhakov, a book that Freeland herself
describes as "scurrilous." One would assume she has a second, more reliable
source, but this is not made clear. The occasional error also creeps in.
Cohen has particular scorn for those who mix up the U.S.S.R.'s Supreme
Soviet with the Russian Supreme Soviet, and Freeland appears to oblige on
page 57. But these are quibbles.
The book is less successful in its analysis. Again, the desire to reduce
Russian events to a simple morality tale seems to take over. In this
version, the villains have changed. Instead of the snake-oil salesmen from
Harvard, Freeland blames the oligarchs for Russia's misfortunes. Her book,
she writes, is the story of Russia's capitalist revolution and of how that
revolution was betrayed. .... [A]t one crucial moment, the Kremlin
consciously and of its own free will took a disastrously wrong turn. ...
[T]hat moment came when the government made a private pact with a group of
upstart capitalist entrepreneurs who became known as the oligarchs. The
deal ... turned out to be a Faustian bargain, laying a corrupt,
inegalitarian foundation for everything that came after it. In a way, it
was Russian capitalism's original sin. Thereafter, the Russian market
economy was irredeemably warped, its government unquestionably corrupt.
That deal was the"loans-for-shares" auctions in late 1995. In what can only
be described as a sleazy operation, the Yeltsin administration gave
tranches of shares in major state-owned corporations to selected
businessmen in trust, in return for loans to the federal budget totaling
around $1 billion. Later, the businessmen were allowed to sell these
tranches to themselves at low prices. Careful rigging of the auctions kept
competition to a minimum. As Freeland points out, there were creditable
reasons why Anatoly Chubais and others went along with this -- most
important, the perceived need to get the oligarchs' help in keeping
inflation down and defeating the Communists in the 1996 presidential
election. But the auctions were both morally dubious and disastrous for
Despite the questionable nature of the deal, however, the claim that the
auctions explain Russia's economic travails -- that they created a
"Frankenstein's monster" that "deformed" the economy and "impoverished" the
population -- is difficult to fit with the facts. Perhaps because her
argument is widely shared, Freeland does not bother to provide much
evidence. On the contrary, her own reporting undercuts this story line at
First, Freeland gets causation exactly backwards. As she herself
convincingly demonstrates, it was not the "loans-for-shares" auctions that
created the oligarchs but the oligarchs who created the auctions. They
devised the scheme among themselves, lobbied the government, even wrote
some of the decrees. Frankenstein's monster already existed.
Oligarch-in-chief Boris Berezovsky had made his fortune years before,
marketing cars from Avtovaz. Mikhail Khodorkovsky had built up his wealth
speculating on high inflation and "managing" state budget funds. The
question by 1995 was whether these tycoons would put some of their money
back in Russia rather than in Swiss banks. Furthermore, only a few of the
so-called oligarchs even participated in "loans-for-shares." Some, such as
Mikhail Friedman and Vladimir Gusinsky, were excluded. Even Berezovsky only
got in at the last moment. And the true behemoths of the business world
were not these newcomers but the leading "red directors," such men as Rem
Vyakhirev of Gazprom and Vagit Alekperov of Lukoil. It would be more
accurate to say the first oligarch appeared back in May 1992, when
Chernomyrdin left Gazprom to join the government. But even that is probably
starting the story too late.
In an economy with massive natural resources and an inheritance of
gigantic, highly concentrated companies, the emergence of "oligarchs" did
not require some complicated act of betrayal by a few reformers in the
government. The only question was whether Russia's business barons would
continue to come exclusively from the realms of the communist aristocracy
or whether some of these would be elbowed out by a few "upstarts" such as
Jewish former mathematicians or theater directors. Since 1991, reformers in
government had had to bargain with and outfox business leaders and the
regional officials with whom the tycoons often joined forces. What changed
in the mid-1990s was the identity of some of the business leaders. Once
upon a time, an insider such as Chernomyrdin could "open doors in the
Kremlin with his foot." By the late 1990s it was Berezovsky who was
badgering presidential appointees in the shower at their sports club and
the press mogul Gusinsky who was yelling at officials on his cell phone.
So how exactly did the auctions "deform" the economy and "impoverish" the
country? The oligarchs were not necessarily more corrupt or rapacious than
the "red directors" they sometimes replaced. Freeland herself describes
old-school enterprise managers who were just as adept at stripping millions
of dollars from the companies they controlled. Did the firms sold in this
way operate less efficiently afterward? Some probably did, but others did
not. At Norilsk Nickel, for example, productivity increased by four percent
in the two years after the infamous auction, compared to a drop of four
percent in the nonferrous metals sector as a whole. By January 1998, its
new management had paid off all wage arrears to workers.
MONEY FOR NOTHING?
That the oligarchs underpaid the government and deprived it of vital cash
is certain -- and hard to forgive. But estimating the shortfall is tricky.
A Western company paid more than ten times as much for shares in one of the
auctioned oil companies two years after the auction. But at the time the
oligarchs put up the money, their gamble was extremely risky. The clear
favorite to win the following year's presidential election was the
Communist candidate, Gennady Zyuganov, who might well have canceled the
deal with no compensation. One of the oligarchs tried to attract a Western
partner to help bid for a major oil company -- and was rudely rejected.
"They looked at us as if we were crazy," he lamented. Even several years
later, the government could not attract any bidders for the oil giant
Rosneft. When Oneximbank tried in November 1997 to sell its tranche in one
of the "loans-for-shares" companies, North West River Shipping, it received
no bids even at an opening price $1 million below the amount that
Oneximbank had loaned the government. Even if one accepts an extremely high
estimate of the true value of the stakes transferred -- up to $30 billion
-- the whole operation hardly amounts to the "sale of the century." It is
more like a medium-sized takeover on the NASDAQ.
To make the case that "loans-for-shares" and the emergence of the oligarchs
undermined and distorted the Russian economy, Freeland has to paint the
late 1990s in more dismal colors than the early part of the decade. This
fits the evolution of Western opinion on Russia. But it does not fit well
with the statistics. The heyday of the oligarchs actually coincided with a
stabilization of the economy or even a slight improvement. In the three
years leading up to "loans-for-shares," monthly inflation averaged 12.7
percent; in the following three years (which included the August 1998
crisis) it averaged 2.7 percent. Foreign direct investment in 1996-98 was
almost three times higher than in the three preceding years ($10.9 billion
versus $3.8 billion). Real GDP fell on average by 8.5 percent a year in
1993-95 but dropped by only 2.4 percent a year in 1996-98, while the
poverty rate fell from an average of 26.7 percent to only 22.3 percent.
Although data on income inequality are notoriously unreliable, that also
appears to have narrowed since 1994. As a sign of the social crisis,
Freeland notes (as does Cohen) that male life expectancy had fallen to just
58 years by 1994. But she neglects to point out that since then it has been
rising, reaching 61 by 1998. The Russian economy remains in serious
condition, but the deterioration occurred before the "loans-for-shares"
auctions and the media's anointing of the oligarchs.
Nevertheless, Freeland is taken by the "Faustian bargain" line. There is a
memorable scene of a dinner in a kitschy, imitation-tsarist restaurant,
when she badgers the head of Gusinsky's NTV, Igor Malashenko, about his
network's overt support for Yeltsin during the 1996 presidential campaign.
With a "world-weary sigh," Malashenko tries to explain his dilemma and
stumbles into a turn of phrase that Freeland takes more literally than he
"... I think, and I thought, that Zyuganov would be a catastrophe. I had to
-- how shall I put it? -- sell my soul to the devil."
"Do you really think that's what you did?" I asked, amazed by his frankness.
"Of course I don't," Malashenko replied with not a little scorn. "But from
the point of view of a middling Western intelligence, perhaps that is what
"By that you mean my intelligence?"
"Yes, yours. You are absolutely right. I live in my own system of
coordinates, that is the pure truth." And with that Malashenko and his
bodyguards swept out of the restaurant.
Malashenko's gratuitous rudeness notwithstanding, there are perhaps grounds
for his irritation. The blatant abuse of state television in 1996 -- and
even more in 1999 and 2000 -- was indeed appalling. But there is something
hypocritical about the West's scolding the Russians for such excesses,
which in any case tend to backfire unless the public already supports the
media's favorite. Can anyone doubt that if the U.S. Communist Party
candidate were running ahead in the polls before an American presidential
election, ABC, NBC, and CBS would be bending the rules to run critical
reports? Are Americans really so much holier than Russians, or are U.S.
elites merely less threatened?
As for press freedom in Russia, a network that reports critically on the
federal government's war against Chechnya exists today only because
Gusinsky was willing to lose more than $20 million a year to start it. For
all their sins, it was the Russian oligarchs who put money into the
newspapers and television stations that now compete with the state's media
outlets. Their interference is at times crude, at times enlightened. As
Freeland relates, one reporter on Gusinsky's paper Segodnya cost the
magnate a deal worth $100 million, thanks to his critical reporting, and is
now nicknamed by his boss the "$100 million journalist."
There was one moment in the 1990s when democracy was genuinely at risk in
Russia, in March 1996. Yeltsin, trailing in the opinion polls, was being
bombarded with pleas from his hard-line supporters such as Aleksandr
Korzhakov to cancel the upcoming presidential election. According to
Freeland, Yeltsin had already ordered his aides to prepare legal documents
to do just that. If that plan had succeeded, this would have been the end
-- at least temporarily -- of democracy in Russia. If it had failed, it
would have meant civil war. As Freeland reports, however, three men
persuaded Yeltsin to tear up the decree and take his chances at the ballot
box. Who were these saviors of Russian democracy? Chubais, Chernomyrdin,
and the hard-line minister of the interior, Vitaly Kulikov. Strange as it
will seem, some of the most vilified political players in Russia's recent
history were also the reason why democracy, for all its flaws, still exists.
Paul Klebnikov, a reporter from Forbes magazine, goes one step further in
reducing history to the search for a villain. In addressing Russia's
troubles of the mid-1990s, Klebnikov also gravitated to the question "Who
is to blame?"
I wanted to know who Russia's real bosses were. Who had brought the country
to such a state? Who was the man who stood at the top of the pyramid? Who
was the godfather of the godfathers?
In the autumn of 1996, I found him: Boris Berezovsky.
If one looks hard enough for a black cat in a dark room, a black cat will
undoubtedly appear. Convinced that a country's poor economic performance
must be the work of some malevolent "godfather of godfathers," any reporter
with gumption will find someone to fit the bill. Berezovsky is a man with
whom this reviewer would not like to be stuck in an elevator for too long,
and after reading Klebnikov's book most readers will probably agree. But
even a self-promoter like Berezovsky is not egomaniacal enough to claim
credit for destroying the Russian economy single-handedly.
It is hard to know what to make of Klebnikov's reporting, since the facts
are so clearly selected to fill in a predetermined picture. He seems to
rely on the accounts of people with an obvious motivation to lie: for
instance, he quotes liberally from the disgraced bodyguard Korzhakov and
his former subordinates. In his political and economic analysis,
Klebnikov's frustrations get the better of his intelligence. His arguments
start out merely implausible. For example, he criticizes the Gaidar
government of 1992 for not issuing government bonds backed up by foreign
exchange or gold to soak up public savings prior to price liberalization --
as if Russia had foreign exchange and gold reserves. By the end of the book
he sinks to ethnic slurs:
At the root of the disaster was the Russian penchant for playing the double
game, for pursuing an essentially dishonest policy. Rather than
consistently following a set of clearly defined principles, the Russian
mentality was to say one thing and do another.
There are a few facts about Russia in the 1990s that observers should be
able to agree upon. Economic output fell sharply. But there was nothing
unique about this: it also fell in the other 14 former Soviet republics.
Some of these attempted "shock therapy," others more gradual reforms or
none at all; some were visited by numerous Western advisers and received
large sums from the IMF, others did not. As of 1998, the cumulative drop in
real GDP was greater in Russia than in seven of the other republics and
smaller than in the other seven. In Russia, as in the other post-Soviet
republics, real incomes also fell sharply. Many enterprises remain badly
managed. The state is extremely corrupt, and this remains an important
obstacle to economic and political development, just as in 1991.
On corruption, the sad truth is that nobody knows how to build an honest,
effective state machine in a country where a dishonest, corrupt state
already exists. Cohen does not know, Freeland does not know, Klebnikov does
not know, The Economist does not know, the IMF does not know, and this
reviewer does not know. History shows that remarkable transformations have
sometimes occurred; for example, nineteenth-century Britain replaced its
rotten boroughs and venal politics with party discipline and much cleaner
government. Evidence suggests that democracy, economic openness, and above
all, growth tend to help, although the effect can be slow. Firing a few
officials in a corrupt system is about as effective as swatting a few
mosquitoes in a swamp. Attempts to centralize power in a large state ý la
Putin will probably just replace political corruption with administrative
corruption. Some changes to the tax system might help a little in Russia,
but the West should stop pretending that there was a simple solution that
could have worked if only Russia's leaders had not been so lazy,
ideological, or corrupt.
Popular writing on Russia has taken a strange turn in recent years. A
little balance and perspective would make it far easier on the reader.
Perhaps all who write about the country could agree to retire some of the
most distinguished clichÈs, to stop alluding to Gogol's "winged troika" or
to the "accursed questions" and comparing Russia to the Klondike. All
authors -- this reviewer included -- might try harder to question their
assumptions, even when they are widely held. As for Russia in the 1990s,
years will probably need to pass before the picture comes completely into
focus. As Cohen would say, it is a question for the historians.
1The reviewer admits he was a "foot soldier" in this crusade, having served
briefly in 1997 on a U.S. team advising the Russians on tax reform.
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