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Johnson's Russia List


November 3, 2000   

This Date's Issues:   4617  4618  4619


Johnson's Russia List
3 November 2000

[Note from David Johnson:
1. AP: Russia Watches Chess Match Closely.
3. The Globe and Mail (Canada): Geoffrey York, Fissures develop in Azerbaijan's facade of democracy. Observers expect electoral corruption to continue in Sunday's parliamentary vote.
4. Reuters: Russian bosses likely to defy prosecution order.
5. Business Week: Is NATO about to Make a Bad Move in the Baltics?
6. The Economist: Kaliningrad, Russia’s tricky exclave.
7. Reuters: US sees Russia letting OSCE back into Chechnya soon.
8. Tom Moore: Forget Russia?
9. Sergei Rachmaninov: re Massachusetts Man detained in Russia.
10. Moscow Times: Ana Uzelac, Poll Conspiracy Theories Swirl.
11. David Maurer: New GAO Report on aid to Russia.
12. Bloomberg: Western Aid to Russia Largely Failed, Report Says.
13. Statement of Rep. James A. Leach on GAO Report on International Efforts to Aid Russia’s Transition Have Had Mixed Results.
14. Reuters: No status change for Russia rocket forces till 2006.
15. Reuters: Putin approves more probes into Stalin repression.]


Russia Watches Chess Match Closely
November 2, 2000

MOSCOW (AP) - The fidgety teen-agers pushing pawns at Moscow's Central House
of Chess had plenty to talk about during breaks in practice Thursday.

Who are you rooting for, Garik or Volodya? And what's wrong with Kasparov,

Closely or casually, many Russians were watching as two of their countrymen,
Garry Kasparov and Vladimir Kramnik, faced off Thursday in game 15 of the
world chess championship in London. And when it was over, Kramnik had
prevailed - Kasparov's long reign as the world's chess champion was over.

Kasparov, 37, had dominated chess since winning the championship in 1985. But
he seemed distracted throughout the Kramnik match, failing to win even one
game. Kramnik won two and there were 13 draws, leaving Kasparov too far
behind to catch up with only one game remaining.

Chess lovers the world over were watching the face-off in London, but nowhere
did it attract as much attention as here: Russia nurtures a nationwide
passion for chess unrivaled elsewhere and produces the vast majority of the
world's chess heroes - and villains. This championship rated extensive
coverage in Russian newspapers and Russian Internet sites, and even pops up
in coffee-break conversation in Moscow offices.

On Thursday night, Kramnik's victory led the sports news on Russian

``We congratulate the new chess king,'' said a sportscaster on the commercial
NTV network.

Traditionalists lament that attention to the game has dwindled since the
collapse of the Soviet system, which took 19th-century Russian aristocrats'
love for chess to the masses by subsidizing championships and chess

``Television doesn't show it as much as they should. They just give a few
words, and it's clear the anchors know the game poorly,'' said Valery
Chekhov, a junior world champion in the 1970s who teaches chess in Moscow.

But even his complaints reflect an expectation that everyone should know how
to play chess. In Russia, most people do. Chess is a staple at many schools,
and chess tables can be found in many parks - and prison yards.

Many Russians appeared to be rooting for Kramnik, an amiable 25-year-old who
once trained under Kasparov. Fans are weary of the controversies the
temperamental, egocentric Kasparov stirred up in his reign as champion, and
they see in Kramnik a chance for reconciliation in the chess world.

``It's probably time for Garik to go,'' Volodya Fedotov, a 16-year-old
shedding his well-worn leather jacket as he prepared for practice at the
Central House of Chess, said before the championship was complete.

Fedotov said he was backing ``Volodya'' Kramnik, using the nickname for

``He has been playing a much more interesting game from a creative point of
view,'' Fedotov said.

Like fans worldwide, Russians puzzled over Kasparov's unusually subdued
performance in the championship. Kasparov took an uncharacteristically long
time to make his moves, while Kramnik appeared calm and unflappable.

Before Thursday, Kasparov had not lost a match to a person since 1985, just
to the computer Deep Blue.

In 1993, he created a schism in the sport when he broke away from FIDE, the
World Chess Federation, and formed the Professional Chess Association. FIDE
has since taken second billing to the Kasparov-led group.

Both remain dominated by Russians. Last week, FIDE opened its 34th World
Chess Olympiad in Istanbul with a ceremony led by FIDE president Kirsan
Ilyumzhinov - the autocratic president of the Russian region of Kalmykia.


Jamestown Foundation Monitor
November 2, 2000

Litvinenko, a former Federal Security Service (FSB) officer, has asked for
political asylum in Great Britain. Litvinenko reportedly made the request
yesterday after arriving in London with his wife and infant child.
Litvinenko gained notoriety back in 1998, when he and several other FSB
officers accused Yevgeny Khokholkov, former chief of the FSB's
anti-organized crime department, and his deputy Aleksandr Kamyshnikov, of
ordering them to murder Boris Berezovsky in late 1997. Litvinenko, whose
ties to Berezovsky go back to 1994, when he helped investigate an attempt
to assassinate the tycoon, was subsequently tossed out of the FSB.
Berezovsky, after becoming Commonwealth of Independent States executive
secretary, appointed Litvinenko as an adviser on CIS security questions
(see the Monitor, November 18, 1998, and March 29, 1999).

Litvinenko said yesterday that he had requested political asylum in Great
Britain on the basis of "ceaseless persecution by the Russian special
services." He claimed that he, his wife and child had been threatened, and
that he had asked the Prosecutor General's Office several times to protect
his family, but had received no answer. His lawyer was quoted as saying
that Litvinenko "fears for his life also because he knows about a lot of
things, including the explosions of the apartment buildings in Moscow last
year" (NTV, November 1). Some reports in the Russian media have suggested
that Russia's special services were behind those terrorist attacks, which
killed several hundred people and served as the pretext for the war in

The charges made by Litvinenko and his fellow officers in 1998 concerning
the alleged plot to assassinate Berezovsky came several days after the
tycoon published an open letter to then FSB Director Vladimir Putin. In
that letter, Berezovsky charged that FSB officials had been involved in
murders, kidnappings and extortion, and that hardline elements in the FSB
were conspiring with hardline communists to revive the Soviet system. Putin
reacted angrily to Berezovsky's open letter, saying that the FSB would not
get involved in "political games." Indeed, it should be noted that while
Berezovsky, Litvinenko and the other pro-Berezovsky FSB officers charged
that top-level FSB officials had been involved in crimes, other FSB
officers charged that Litvinenko and his associates were guilty of the same
thing (see the Monitor, November 18, 1998, and March 29, 1999).


The Globe and Mail (Canada)
November 2, 2000
Fissures develop in Azerbaijan's facade of democracy
Observers expect electoral corruption to continue in Sunday's parliamentary

BAKU -- Almost a decade after gaining independence, most of the former
republics of the Soviet Union have learned how to adopt the facade of

Under Western pressure, they've held elections and set up the appearance of
democratic structures.

But the facade is beginning to crack. Recent elections in Belarus, Uzbekistan
and Kazakhstan were blatantly rigged in favour of the ruling regime. Dubious
votes in Ukraine and Georgia produced implausible results. And the story of
another former Soviet republic, Azerbaijan, shows how superficial democratic
appearances can be.

Azerbaijan, an oil-rich nation of eight million people on the Caspian Sea,
has long faced criticism from foreign observers for unfair elections, limits
on media freedom and harassment of opposition activists.

The West will be watching the parliamentary election on Sunday to see if
anything has changed. Over the past year, however, Azerbaijan's authoritarian
regime has shown it can crush even hints of local self-government.

Azerbaijan's Western-style constitution, adopted in 1995, promised that
municipal elections would be held within two years. Authorities, who
preferred appointing officials to run local affairs, repeatedly postponed the
vote until -- under pressure from the United States and the European Union --
balloting was held last December.

Western and local observers said the election was seriously flawed. The
ruling party, New Azerbaijan, won 40 per cent of the municipal seats, and
many other councillors were also government loyalists.

Since then, the government has allowed the elected councils to wither away
into irrelevance. Most are powerless; ignored, and hobbled by appointed
officials who oppose their existence.

A recent survey by the International Foundation for Election Systems, a
U.S.-based organization, looked at 64 municipal councils. It found that no
more than 10 had any substantial activities or offices. The largest budget
was just $1,500 (U.S.). They were unable to collect any revenue, even from
billboards or parking fees, because the government had not officially
registered them.

The survey found that the municipal elections, like other elections in
Azerbaijan, are widely seen as corrupt. The prevailing belief among
Azerbaijanis is that anyone could purchase a municipal seat through bribery
-- for about $2,000 (U.S.).

"The new structure has been completely paralyzed. They've created a sick
child with a damaged genetic code that it inherited from the system that
conceived it," said Eldar Ismailov, head of an independent organization that
trains election observers and supports civic education.

Many analysts are pessimistic about Azerbaijan's parliamentary election on
Sunday. Several opposition parties were banned from the vote, although most
were able to overturn that.

"There has not been a single fair parliamentary election in Azerbaijan so
far," said Novella Jafarova, a local democratic activist and head of a
women's rights group. "For us, it is increasingly difficult to attract people
to vote because they know the elections are unfair."



Russian bosses likely to defy prosecution order
By Ron Popeski

MOSCOW, Nov 2 (Reuters) - Two Russian media and business magnates told to
appear before prosecutors later this month seemed increasingly determined on
Thursday to defy orders to turn themselves in and face criminal charges.

Both Vladimir Gusinsky and Boris Berezovsky were out of the country and
appeared unlikely to come to Moscow on November 13 to face embezzlement
charges issued by a top prosecutor in a high-profile public announcement on

Gusinsky and Berezovsky have been targeted in past proceedings involving
alleged financial misdeeds. They own interests in two of three national
television networks, and have in the past accused authorities of harassing
them to stifle criticism of the government.

President Vladimir Putin has repeatedly vowed to get tough with "oligarchs,"
who became wealthy in the aftermath of the collapse of Soviet rule, if they
blocked reforms or broke laws.

Berezovsky, a Kremlin insider under former President Boris Yeltsin, told a
Moscow radio station that the charges against him were "political blackmail"
and he would consult lawyers before considering returning to the capital.

A spokesman for Gusinsky said his Media-Most company, Russia's only
country-wide independent media network, was on the brink of clinching an
accord to settle debts.

He did not believe Gusinsky, jailed for three days earlier this year on
embezzlement charges, would return to Moscow.

"I cannot accept allegations that I violated Russian legislation in economic
terms," Berezovsky told Ekho Moskvy Radio. "I am certain that what I did over
all this time was completely legal."

He dismissed the prosecutor's statement saying fresh evidence had linked him
to allegations that profits had been skimmed from the Russian flagship
airline Aeroflot <AFLT.RTS>. Two years of investigation into the issue, he
said, had turned up nothing, proving the matter was "purely political."


In a separate interview with the daily Izvestia, he suggested he could help
solve Gusinsky's financial problems and preserve NTV, Media-Most's flagship
private television network, as an independent source of news.

"We are discussing this idea with Gusinsky," he told the daily. "I have not
ruled out using whatever possibilities are open to me to keep NTV as a
non-state television channel."

Dmitry Ostalsky, Media-Most spokesman, hoped weeks of talks could produce a
deal in a Moscow court on Friday to settle hundreds of millions of dollars in
debts to Gazprom <GAZP.MO> Media.

He was uncertain how the accord might affect the prosecutor's allegations
that he used "deception and abuse of trust" to acquire property and funds
worth about $300 million from the state-dominated natural gas monopoly.

"Frankly, I don't know because I think the allegations are pointless," he
said by telephone. Details of the accord have not been released, but Media
Most officials say they will guarantee the independence of their journalists.

Media Most, which has periodically broadcast coverage critical of Russia's
war in Chechnya and other Kremlin policies, had earlier said it believed the
prosecutor's action sought to torpedo the group's attempts to clear its debts
with Gazprom.

Gusinsky's lawyer, Genri Reznik, told Interfax news agency he was inclined to
tell the magnate to ignore the prosecutor's order -- as he has already done
on several occasions since his release from prison in July when charges were
dropped. He said the prosecution had produced "artificially created

The daily Vremya Novostei suggested the prosecutor was trying to offset
previous setbacks in investigations.

"As we know, investigators have already levelled charges against Gusinsky and
Berezovsky, but these ended in confusion," it said. "Now it appears the
prosecutor has decided to play out those earlier draws."


Business Week
November 13, 2000
[for personal use only]
Is NATO about to Make a Bad Move in the Baltics?
By Paul Starobin in Moscow, with Stan Crock in Washington and Alexander
Mikhalchuk in Minsk

For nearly a decade since the end of the cold war, the U.S. and its European
allies have essentially written off Russia as a serious military threat. Even
though the former superpower remains a nuclear player, it can't afford to
maintain its once-formidable arsenal, and its conventional forces are in
serious disarray. Even President Vladimir V. Putin has called for sharply
scaling back to 800,000 troops from today's level of 1.2 million and reducing
strategic nuclear weapons to 1,500 from the current 6,000 in exchange for
similar cuts from the U.S.
But now, the U.S. is in danger of provoking a far more truculent defense
stance from Russia. One hot-button issue is the awaited decision by the U.S.
on a missile defense system that Russia adamantly opposes. An equally
important but less-discussed point of tension is the planned expansion by
NATO to Russia's borders by 2002. Both Presidential contenders, Al Gore and
George W. Bush, support moving the NATO umbrella eastward to include the
Baltic states of Lithuania, Latvia, and Estonia.
Such a move would go beyond last year's NATO admission of Poland,
Hungary, and the Czech Republic, since it would mark the first time that a
former Soviet republic would join the Western defense alliance. Conventional
wisdom in Washington is that Russia probably can't and won't do anything to
counter the NATO plans. After all, Soviet leader Mikhail Gorbachev didn't
intervene as the Berlin Wall fell. His successor, Boris N. Yeltsin, allowed
former Soviet satellites to join NATO, although he protested.
HAWK BAIT. Putin, however, is expressing increasingly vocal opposition to
NATO expansion into the Baltics. In an Oct. 26 interview with French
journalists, the Russian leader declared: ``The reasons that brought NATO to
life [a half-century ago] are no longer there. Yet NATO exists. It not only
exists but is expanding. Moreover, it is expanding in the direction of our
own borders....Of course, this causes us concern.''
Even more important, the plans by NATO and the Baltics are strengthening
the political hand of hawkish defense officials to Putin's right. Key members
of the defense Establishment such as Defense Minister Igor Sergeyev are
resisting efforts to pare Russia's strategic nuclear forces to free up
resources for the conventional military. Instead, they want Russia to
maintain a big nuclear stick to guard against a resurgent NATO. ``NATO
expansion pushes Russia toward more reliance on [strategic] nuclear forces,''
says Russian defense analyst Sergei Karaganov. He argues that incorporating
the Baltics into NATO needlessly antagonizes Russia and is a ``stupid'' move
for the West.
FORTRESS BELARUS? To be sure, no one expects Russia to go to war to prevent
the Baltics from joining NATO. But there are nonetheless new signs of
military activity on the ground. Even though NATO's decision is two years
away, the Baltic states are already moving to integrate their militaries into
the alliance--establishing a common air-defense system compatible with the
alliance's and tailoring their weapons, ammo, and uniforms to meet NATO
In response, Moscow is stepping up an alliance with next-door Belarus,
which also has a border with Lithuania. For the first time in six years,
Russian bombers and nuclear-missile carriers recently landed in Belarus on a
training mission. And Belarus President Alexander Lukashenko wants Putin to
deploy a joint force of 300,000 troops near the border with Poland.
If such developments continue, the stage will be set for a period of
tension at NATO's frontier. It may not amount to a new cold war, but it could
end up to be far from what the Baltics--and NATO--intended.


The Economist
November 4-10, 2000
Kaliningrad, Russia’s tricky exclave
Euro-Russians adrift

THEY speak Russian, but do not feel quite at home in Russia proper; they
visit nearby Warsaw and Vilnius much more often than St Petersburg, let
alone distant Moscow. The 1m-odd people of the Kaliningrad region, a
Russian exclave on the Baltic, increasingly call themselves
“Euro-Russians”. Though they have largely left behind their
military-dominated past, they have not—yet—arrived in the modern European
future that they want.

The election, on November 5th, for governor may help a bit. The incumbent,
Leonid Gorbenko, has held the region back over the past four years, with
oafish, clannish and erratic behaviour that has deterred investors and made
neighbouring countries despair. He is running third, thanks, among other
things, to Kremlin backing for both his rivals.

The front runner is Vladimir Yegorov, an old-fashioned retired Soviet
admiral drafted into the campaign by local power-brokers with strong ties
to Moscow. His election poster shows him posing with President Vladimir
Putin during a visit to the region when the Russian leader conspicuously
snubbed Mr Gorbenko.

The other serious challenger is a former KGB man called Yuri Sinelnik, now
a fisheries tycoon. His well-financed campaign also stresses his closeness
to the Kremlin (under a previous era, say his opponents). His main ally in
Moscow is Sibneft, a giant oil business run by chums of the former
president, Boris Yeltsin.

Mr Putin’s main concern seems to be to get rid of the embarrassing Mr
Gorbenko. And although the new governor can make his patch a better
neighbour, it is the Kremlin that will decide its future. The region’s own
interest is in being open to both east and west, to take advantage of its
ice-free port and cheap, skilled labour force, much of which made or
serviced advanced weapons in Soviet times. But many in Moscow, especially
in the military and security agencies, see Kaliningrad (once Königsberg, in
East Prussia) as a precious trophy from the second world war, and a
military bastion that must be protected from outside interference.

This is now becoming an issue between Russia and the EU; this week Mr Putin
discussed it with EU leaders in Paris. So far, Kaliningrad people have been
able to travel visa-free to Poland and Lithuania and to import goods
duty-free for selling in Russia proper. This mixture of smuggling and legal
trade has kept the economy ticking over. But when Lithuania and Poland
eventually join the EU, Kaliningrad risks becoming an even poorer, more
isolated backwater, leaking crime and disease into the prosperous Baltic

The EU is keen to help Kaliningrad get ahead, but that will be hard so long
as Russia sees it as strictly its internal affair. This twitchiness has
even prevented western countries from opening much-needed consulates there.
This leads to some oddities: the (Polish) manager of the local Scandinavian
airlines office, for example, is also the busy honorary consul of Sweden,
Denmark and Iceland. “Yeltsin and [Germany’s former chancellor] Kohl had a
gentlemen’s agreement not even to raise the matter of a German consulate,”
says a pro-western Kaliningrad official in exasperation. “Russia sees the
region’s status as a zero-sum game. We want win-win”.


US sees Russia letting OSCE back into Chechnya soon
By Elaine Monaghan

WASHINGTON, Nov 2 (Reuters) - The United States sees Russia making a key
concession to Western critics of its military campaign in Chechnya within
weeks by letting the Organisation of Security and Cooperation in Europe back
into the shattered, independence-minded region, U.S. officials said on

But they said Russia still had a long way to go in addressing alleged
widespread atrocities carried out by its forces in Chechnya, including in
"filtration camps" where human rights groups say detainees were beaten and

No one knows the full extent of what happened in Chechnya. Journalists were
heavily restricted in the tiny mountainous region and the risks were high for
foreigners even before the fighting because of the high incidence of
kidnapping there.

But human rights groups and Western governments say thousands of civilians
were killed due to Russia's indiscriminate use of force. Moscow denies this
and says it was trying to root out separatist "terrorists."

"What we've seen and what discourages us the most is the reluctance,
certainly on the part of the military, to look seriously at the burden of
evidence," John Beyrle, deputy to the ambassador-at-large for newly
independent states, said in an interview, adding, "Some very terrible things

But the OSCE could help meet largely unmet, basic humanitarian needs on the
ground, said Bennett Freeman, deputy assistant secretary of state for human

"Our expectation is that the group should be back in and functioning
certainly before the end of the year, if not this month," Beyrle said, adding
that only technical issues of security and diplomatic status stood in their


Winter can be cruel in Russia, all the more so in Chechnya, where an already
anarchic infrastructure was wrecked in conflicts between the Russian army and
Chechen rebels first in 1994-95 and again in fighting which erupted in
September 1999.

Grozny, the capital, was battered by Russian forces in the first and in the
second conflict, which was prompted by clashes in neighbouring Dagestan and
bomb blasts in Russian cities which Moscow blamed on the Muslim separatists.

The fighting continues, partly propelled by President Vladimir Putin's
determination to get rid of rebels he vowed to "rub out" before he inherited
the Kremlin mantle following Yeltsin's dramatic resignation on New Year's

Part of Russia's reluctance to admit the OSCE, Europe's top rights watchdog
of which Russia is a member, was because Moscow was worried it would launch
straight into a mediating effort, said Beyrle, a fluent Russian speaker
involved in President Bill Clinton's Russia policy since he came to power in

He said the time was not yet right for peace talks but was encouraged by
Putin's statement at a European summit last month saying a political solution
was required to the conflict.

Freeman praised the work of human rights ombudsman Vladimir Kalamanov and
human rights commissioner Oleg Mironov who he met in Moscow last week, saying
they were working hard to gather data about human rights abuses.

But they have no mandate to prosecute, only to pass cases on and very few
prosecutions have been instigated despite Moscow's promises to the contrary.

"We are also concerned by what appear to be continuing abuses," Freeman said.
The U.S.-based Human Rights Watch again blasted Russia in a report last week
for Chechnya, saying tens of thousands of refugees were too scared to go home
for fear their men would be arrested or killed.


Date: Thu, 02 Nov 2000
From: (Tom Moore)
Subject: Forget Russia?

Stipulation: These views do not reflect those of my employers, and
are mine entirely. They cannot be quoted without my permission.

The question posed, has the "school" of policy makers who "forget"
Russia when plotting future US policy, can be answered affirmatively.

For my part, I think the question at hand can be answered
affirmatively without embarking on a policy of isolationism or
abandonment, neither of which would get us anything we want. The
United States cannot and should not embark on a policy of engagement
and cooperation at all costs, as we have done in the past. We must
ask ourselves what is it that we want to get from our future
relationship with Russia.

I would like to focus my answer to the question by way of Dr.
Celeste Wallander's reply on JRL No. 4614, which dealt in some part
with nonproliferation and arms control issues.

Dr. Wallander's useful division of the question into "forgetting"
Russia in either the realms of economic reform or arms control allows
me to make an observation.

We must draw a distinction between helping make Russia more
democratic and stable and doing what is in our own best interests in
the world. Moscow was prepared, at the end of the Bush
administration, to negotiate changes in the ABM Treaty. They are not
now. This is due to the policy of engagement at any price. My bottom
line is that the current policy of, if you will, "remembering" Russian
concerns has not in any way prevented the spread of WMD technology
from Russia nor has it added to a more stable arms control regime.

I would endorse setting aside the bilateral US-Russian relationship
in arms control agreements, or at least not giving it first priority
because these Cold War agreements make no sense in an era of
asymmetric threats, dynamic, newer and cheaper technologies, and the
addition of new nuclear states. Continuing to base reductions in our
strategic nuclear forces on the Russian situation is really very
crazy. It would, in effect, place us back in the 1960s. With fewer
weapons, we would again start down the road toward the policy of
massive retaliation by targeting civilians.

I say this because Dr. Wallander notes that "The potential for a
new arms race, for proliferation of a whole range of weapons
technology. . . .depends in very large measure on Russia and its
future economic and security priorities." This is true, and while we
sit here remembering Russia, Russia has sold certain technologies to
states of concern. While we remember Russia, it has not cut its
military to come into line with economic reality. The Untied States
must pursue, both at home and in the world, export control policies
that will better control NBC weaponry and systems. If we focus on
Russia and our agreements with it, we are limited to past
nonproliferation policies that we must move away from in our new
world. We must move toward a policy of selective nonproliferation,
rather than limit ourselves to a reality no longer applicable to
US-Russian relations. If we remain committed to past arms control and
nonproliferation accords, we will see only their erosion with no new
safeguards in place that anticipate the new state of affairs.

I argue that this movement away from concentration on past and
possible future agreements with Russia in arms control and
nonproliferation would be beneficial. In those areas where our
policies with regard to the other parts of the world intersect with
the Russian plane, we must not make it a default position of ours to
consider Russia first, last, and always. Such movement would allow
us, in Dr. Wallander's words, "to start thinking long-term and
multi-dimensionally about [Russia]" and the world.


From: "Sergei Rachmaninov" <>
Subject: Massachusetts Man detained in Russia
Date: Thu, 02 Nov 2000

In Russia some problems are hard to solve, while others are very easy
to solve. The "problem," of the Massachusetts Man being detained in Siberia
is a very easy problem to solve.(JRL#4615)

Actually he is not being detained, the authorities only took away his
Russian visa. He probably still has his US passport. He can very,
very easily buy a train ticket from any Siberian city to Moscow.

Documents are very rarely checked on internal Russian trains.

Visa controls are not enforced on most of the frontiers between Russia and
the CIS.This is most certainly true of Belarus,and for most of the time
entering Ukraine.

The Baltic states do not require visas from US citizens.

Legally, he may not be able to leave Russia without a Russian visa, but
unofficially it it very, very easy.

Russia is not a police state!


Moscow Times
November 3, 2000
Poll Conspiracy Theories Swirl
By Ana Uzelac
Staff Writer

As gubernatorial elections approach in 33 regions, speculation is flying
thick in the media that the Kremlin has a plan to squeeze out of the running
incumbent governors who have fallen from favor.

The press reports have gained momentum in recent weeks after a regional court
in Kursk struck Governor Alexander Rutskoi from the ballot and the Chukotka
governor was called in by the tax police for questioning about his business

The investigative newspaper Novaya Gazeta published this week what it called
an internal document from the presidential administration identifying four
"undesirable" governors and one deputy governor from the central regions who
should be removed from the running by the courts.

Saying the candidates had abused their offices and misused funds on the
campaign trail, the document named Rutskoi, Bryansk Governor Yury Lodkin,
Vladimir Governor Nikolai Vinogradov, Ryazan Governor Vyacheslav Lyubimov and
Kaluga Deputy Governor Anatoly Artamonov, who has been selected by the
incumbent Kaluga governor as his heir apparent, according to Novaya Gazeta.

The newspaper said it had obtained the six-page document from a reliable
source and it was meant for the eyes of the presidential staff chief,
Alexander Voloshin.

The Kremlin has not commented about the report.

But three of the candidates named in Novaya Gazeta shrugged it off Thursday,
saying that it was a provocation and that they do not see any threat from the

"I feel no pressure whatsoever from the presidential administration," Bryansk
Governor Lodkin said in a telephone interview, adding that the document was
"a bad fake."

Lodkin is running for re-election Dec. 10.

Vladimir region's Vinogradov and Kaluga's Artamonov echoed similar feelings
through their representatives.

"We read the article and forgot about it the next day," said Artamonov's
campaign manager, Gennady Sklar.

The Kaluga vote is set for Nov. 12 and the Vladimir poll for Dec. 10.

Rutskoi, who has not commented on the report, is lashing out at the
government after being disqualified from Kursk elections Oct. 21 for campaign
funding irregularities. The enraged governor lodged an appeal with the
Supreme Court, but the court upheld the lower court's ruling at a hearing

The Ryazan governor refused to say whether he thought he was coming under
fire from the Kremlin.

"The governor doesn't like to talk about this subject," his spokesman said.
"There are no reasons why we should be compared with Kursk. There are no
irregularities in our campaign."

But Lyubimov could also be thrown out of the race if his main opponent,
Mikhail Malakhov, gets his way.

"There are already many irregularities in the campaign, although it has just
started," Interfax quoted Malakhov as saying at a news conference Wednesday.
"If I feel I have reasons to, I will use my right to complain in the court."

Malakhov was listed in the Novaya Gazeta document as the person who would
help the Kremlin get rid of Lyubimov by filing charges against him for abuse
of office during the election campaign.

The five regions mentioned in the Novaya Gazeta report all fall into the
Central Federal District, one of the seven super-regions carved out by the
Kremlin earlier this year. Some reports have suggested that district head
Georgy Poltavchenko was charged by the Kremlin to push out the governors.

Vladimir Alexandrov, a spokesman for Poltavchenko, said his office does not
have any plan to push candidates out of the running, calling the newspaper
report "an intelligent attempt to influence the work of courts."

"They pulled the rug out from under the feet of all future court appeals
against those governors," he said. "Now if somebody files a complaint and the
court decides in his favor, everybody will cry out that it's a conspiracy."

Novaya Gazeta is far from the first newspaper to speculate about a Kremlin
conspiracy. The Versia weekly claimed last month that it had obtained a
confidential document drafted by the Kremlin's powerful Security Council that
suggested measures to ensure that secret service officers won most of the 33
elections slated for the rest of this year.


Date: Thu, 02 Nov 2000
From: "David C Maurer"<>
Subject: New GAO Report

Hello David,

We (GAO) just released our big report on Russia (Foreign Assistance:
International Efforts to Aid Russia's Transition Have Had Mixed Results).
Could you please pass along this ordering information so readers of your
list can get a copy. The first copy of the report is free. Additional
copies are $2 each.

To order by phone call: 202-512-6000
By email, visit the GAO website at

The report number is GAO-01-8; you need to have this number available when
ordering the report.
Many thanks for passing this along.
-- Dave Maurer, USGAO


Western Aid to Russia Largely Failed, Report Says

Washington, Nov. 2 (Bloomberg)
-- The $66 billion in aid the U.S., the International
Monetary Fund and other Western donors poured into Russia to promote a free
market since the collapse of communism largely failed to achieve results, a
U.S. congressional report found.

Almost a decade after the fall of the Soviet Union, many Russian industries
lack competition, and the growing ranks of poor people are suffering from a
shortage of social services, according to the report by the General
Accounting Office, the investigative arm of Congress.

``Russia's economic decline has been more severe and its recovery slower than
anticipated,'' the GAO said. ``The immense challenge of Russia's transition
to a market economy and democratic society was underestimated by the
international community and by Russians, and the transition will clearly take
longer than initially expected.''

The report casts doubt on both a cornerstone of U.S. foreign policy -- the
need to swiftly push Russia toward capitalism -- and on the recommendations
of the IMF, the global lender that has been accused of offering bad advice to
countries from Indonesia to Ecuador.

Russia's gross domestic product was about 40 percent smaller in 1999 than it
was in 1991, a period during which the economies of 22 of the 25 countries in
the former Soviet bloc also shrank, according to the IMF.

New Mission

The IMF, which is preparing to send a mission to Russia to negotiate a new
credit line to the government, suspended its previous $4.5 billion loan amid
allegations of Russian money laundering and because of concern about the
country's economic policies.

The fund approved $37 billion in loans to Russia since the country joined the
IMF in June 1992 and has disbursed about $22 billion of that -- about
one-third of Russia's aid from overseas during that period.

The Russian embassy and the country's representative to the IMF weren't
available for comment.

The IMF has already apologized for giving Russia and other former Soviet
republics policy recommendations that led them to rush the sale of
government-owned companies to investors who later cheated the state of taxes.

Badly timed IMF loans also helped ``vested interests'' in the region take
control of large industries, the IMF said in its World Economic Outlook in
September. Widespread tax evasion among those companies hurt economic growth,
the lender said.

Fear of Communists

Western powers, who provide most of the fund's capital, bear some
responsibility for the IMF's mistakes, the report suggested.

``A key reason'' for a $1.5 billion IMF loan to Russia in 1994 ``was the
general concern at that time that without Western support, there would be a
heightened possibility of communists taking over the government,'' the GAO

Still, the report offered some praise for the fund's advice, which the GAO
said had improved economic data collection, strengthened bank supervision and
boosted the country's ability to carry out fiscal and monetary policy.

IMF Managing Director Horst Koehler called the report ``carefully considered
and well-balanced.'' The fund's assistance to Russia ``has had a modest,
positive impact in various areas,'' Koehler added.

The U.S. Treasury said in a letter to the GAO that ``greater attention might
have been paid to evaluating domestic support'' in Russia for reforms backed
by aid.

Oil-Powered Economy

Russia, the world's third-largest oil exporter, has made about $6.3 billion
in repayments to the IMF since the beginning of 1999, about 10 times more
than it received from the fund before its last loan was cut off.

Even with smaller aid flows, Russia's economy is recovering, powered by a 27
percent rise in oil prices this year.

The government said last week it will collect 230 billion rubles ($8.2
billion) more revenue this year than previously forecast and that the economy
will grow 5.5 percent in 2000.

The IMF projected in September the economy would grow 7 percent this year,
after expanding only 3.2 percent last year and contracting almost 5 percent
in 1998.

That recent economic success has partly obscured Russia's failure to
fundamentally convert to a free-market economy.

The country's aid donors didn't help by failing to acknowledge the depth of
the challenges they faced in attempting to alter the economy and trying to
force changes before the public agreed to them, the GAO found.

No Consensus

``The overarching lesson is that without some degree of consensus and
political commitment within Russia, the impact of assistance programs on
political and economic reforms is limited,'' the GAO said.

A real transition to a market economy ``requires broad, grassroots support,
and calls for greater means to cushion social impacts on vulnerable groups''
as well as greater coordination among donors and longer-term planning, it

The report's conclusions drew angry words from House Banking Committee
Chairman James Leach, who last year held hearings regarding Russian money

``The assistance was, in fact, worse than wasted,'' the Iowa Republican said.
``The money which was virtually thrown at Russia contributed to the spread of
a culture of corruption and the concentration of some of the country's most
valuable economic assets in the hands of a handful of oligarchs.''

Leach didn't advocate an end to U.S. assistance to Russia. ``A peaceful and
democratic Russia remains a compelling U.S. interest,'' he said. ``Americans
maintain an interest in helping the Russian people achieve a market economy
based on the rule of law.''


Congressional Record
November 1, 2000
Floor Statement
Of Rep. James A. Leach
Chairman, House Banking and Financial Services Committee
GAO Report on International Efforts to Aid Russia’s Transition Have Had
Mixed Results

Mr. Speaker, in June of 1998, the Banking Committee held a series of
hearings on financial instability around the world, including Russia, whose
economy was soon to be devastated by the collapse of its domestic bond
market and a devaluation of the ruble. Afterward, I asked the General
Accounting Office to conduct a study of the effectiveness of U.S. and other
western assistance in facilitating Russia’s transition from a failed
communist-style command economy to a modern market economy. The Committee’s
ranking member, John LaFalce, joined me in that request.

The GAO has now completed its work, and the findings are disturbing, indeed
dispiriting. Between 1992 and September 1998, the United States and the
West -- including the International Monetary Fund, the World Bank and the
European Bank for Reconstruction and Development - provided some $66
billion in assistance to Russia, not counting food aid, trade credits and
debt rollovers. Of this, the U.S. contributed $2.3 billion in bilateral
grants under the Freedom Support Act to address humanitarian needs and
support economic and democratization reform. According to the GAO, far from
putting post-communist era Russia on a course of prosperity and stability,
these funds were largely wasted. "Russia’s economic decline has been more
severe and its recovery slower than anticipated," the GAO report notes.
"Progress toward reaching broad program goals has been limited."

The assistance was, in fact, worse than wasted. Because donors lacked a
clear strategy and coordination, as the GAO observes, the money which was
virtually thrown at Russia contributed to the spread of a culture of
corruption and the concentration of some of the country’s most valuable
economic assets in the hands of a handful of oligarchs who operate on the
margin of, if not all together outside, the law. These politically powerful
economic groups have had little interest in reform. Thus, to a significant
degree, western aid programs were not only ineffective; they provided fuel
to groups that opposed reform.

Consider the Russian banking system. Donors recognized that an efficient
and competitive financial system was a basic need if the economy was to
prosper. To this day, however, 8 years after the collapse of communism and
the breakup of the Soviet Union, Russia does not have a banking system
worthy of the name. There are more than 1000 banks in Russia, but their
total assets are only about $65 billion - the level of a mid-size
provincial bank in the U.S. This is because the Russian public does not
trust these institutions. Most of these banks, particularly the small ones,
exist as money laundering platforms to help their clients evade taxes,
duties and other legal requirements and to spirit capital to overseas
havens. More than $100 billion has fled the country, and some estimates
place the amount much higher.

The GAO analysis released today underscores an unfortunate but inescapable
conclusion: the United States and the West missed one of the great foreign
policy opportunities of this century - to bring Russia into the Western
family of nations, politically as well as economically. Despite the aid,
Russia's economic decline was among the most severe and its recovery among
the most limited among transition countries in Eastern Europe and the
Soviet Union. Many Russians have concluded the West deliberately
impoverished their country. Today only 37 percent of the Russian people
have a favorable view of the U.S., down from 70 percent in 1993.

Among the key findings of the GAO report:

The U.S. and the West failed to object strongly to the corrupt "loans for
shares" privatization scheme that consolidated the business empires of
Russia's "oligarchs."
Russia's primary motivation in borrowing from the IMF was less to stabilize
and reform its economy than to become eligible for debt relief from the
U.S. and other creditor countries through the Paris Club.
The IMF was pressured by key shareholders to support new loans for Russia
in 1994 and 1996 in an effort to demonstrate U.S. and Western political
support for President Yeltsin.
Despite compelling evidence of an absence of the rule of law and massive
governance challenges, explicit anti-corruption efforts have represented a
relatively small share of international assistance to Russia.
Little or no progress has been made in strengthening Russia's banking and
financial system.
The recent rise in world oil and commodity prices has improved the trade
balance of Russia, but continuing capital flight indicates major legal
reforms have yet to occur. As a result, the business climate in Russia is
still unfavorable. In a recent strategy review, the EBRD concluded, "Severe
weakness in the rule of law continues to undermine investment... The power
of vested interests to hold back critical reforms must be effectively
checked. Standards of corporate governance need to be strengthened. Without
demonstrable progress in these areas, Russia's impressive recovery is not

Despite these failures and frustrations, the U.S. cannot afford to remain
uninvolved with Russia. Stretching across 11 times zones - twice the
distance from New York to Honolulu, almost halfway around the world -
Russia is a country without which no serious international issue can be

In recent years, some progress has been made in nuclear weapons reduction
and security, and in April Russia finally ratified the START II agreement.
But many other problems remain. Among them is Russia's decision to build
nuclear reactors in Iran and transfer missile technology to that country.

In this context, the recent revelations that the U.S. and Russia had
entered into a secret agreement to allow Moscow to continue arms to Iran
are especially troubling. It would appear that the Clinton-Gore
Administration, in its relations with Russia, chose to abandon the
principles of progressive diplomacy established at the beginning of the
century by Woodrow Wilson in his demand for open covenants, openly arrived at.

The still secret Gore-Chernomyrdin agreement not only flouted law, but also
failed to safeguard our national interest and security. In what amounted to
an inverted arms-for-hostages deal, U.S. policy was, in effect, taken
hostage by a Russian arms strategy designed to destabilize the Middle East.

The agreement’s apparent purpose was to facilitate a Russian aid policy
that resulted in the squandering of American tax dollars for the benefit of
a kleptocratic elite, rather than the Russian people.

The legitimization of Russian arms sales in defiance of law is hardly in
the interest of a safer world. The naiveté of this approach is matched only
by the perfidiousness of its execution.

>From an American perspective, it would appear that one of the purposes of
the Gore-Chernomyrdin Commission may have been to burnish the Vice
President’s foreign policy credentials and make his management of
U.S.-Russia relations a centerpiece of his potential campaign themes. It is
now self-evident that U.S. policy failed, and the Gore-Chernomyrdin
Commission is a symbol of that failure.

The question is how the U.S. and the next Administration should proceed
from here. Though isolationism is always at issue in our democracy, the
American tradition is dominated by pragmatic and compassionate
internationalism. Most Americans recognize that what happens in Russia,
still a nuclear superpower with a seat on the UN Security Council, is
profoundly important to our national security. A peaceful and democratic
Russia remains a compelling U.S. interest. Consistent with the strong
humanitarian strain in our foreign policy, Americans maintain an interest
in helping the Russian people achieve a market economy based on the rule of

America need not turn its back on the international financial institutions,
but it has an obligation to see that taxpayer resources are not squandered,
nor used to enrich the few at the expense of the many. Americans should
continue to be prepared to support genuine Russian efforts to help
themselves. Here, it must be understood that Russia’s economy will remain
hapless unless the Russian government begins to deal effectively with
corruption and takes the necessary steps to establish an intermediary
financial system that serves a saving public, instead of a thieving elite.

No nation-state can prosper if it lacks a place where people can save their
money with confidence and seek lending assistance with security. Russia,
which is the land mass most similar to our own, has been kept back for most
of this century by the Big "C" of Communism and is now being kept back by
the little "c" of corruption - which may prove more difficult to root out
than Communism was to overthrow.

What the Russian people - and those of so many developing countries -
deserve is a chance to practice free market economics under, not above, the
rule of law. If attention is paid, above all, to establishing honest,
competitive institutions of governance and finance, virtually everything
else will fall into place.

Unfortunately, over the past six or eight years the basics of law and
economics have been ignored for the sake of the politics of expediency and
neither the national interest of America nor Russia has been advanced by a
mistargeted and mismanaged aid program.

It is time that the symbiotic statecraft symbolized in the
Gore-Chernomyrdin relationship that has legitimized and ensconced crony
capitalism in Russia be brought to a halt. It is time for the American
people to insist that their leaders concern themselves with the plight of
the Russian people rather than the well being of a new class of kleptocrats.


No status change for Russia rocket forces till 2006
November 2, 2000

MOSCOW (Reuters) - A senior Russian official said in an interview released
Thursday there would be no change of status before 2006 for Russia's
strategic rocket forces, at the center of an embarrassing public row over
their future.

Sergei Ivanov, secretary of the increasingly influential Security Council,
said in an interview to be published in Friday's issue of the weekly Vek that
strategic rocket forces would remain a separate army branch for at least six

"Only after 2006 the issue of a possible change of status of Strategic Rocket
Forces will be discussed," he said.

The force, which manages Russia's vast but largely obsolete arsenal of
land-based nuclear missiles, came under scrutiny after top brass publicly
quarrelled over whether it should remain independent or be merged with
another branch of the military.

President Vladimir Putin had to personally intervene to cool the passions of
his defense minister, Igor Sergeyev, a staunch proponent of keeping the force
intact, and army chief of staff, Anatoly Kvashnin, who wants more money for
ground forces.

Putin charged the Security Council with settling the issue.

In the interview, Ivanov said until 2006 the force would gradually shrink as
older missiles were decommissioned.

Russia, which has no money to maintain or replace nuclear arsenals inherited
from the Soviet Union, hopes to strike a START-3 deal with the United States
to drastically reduce the number of its strategic missiles without
compromising security.


Putin approves more probes into Stalin repression
November 2, 2000

MOSCOW (Reuters) - President Vladimir Putin gave the go-ahead Thursday for
deeper probes into the fate of millions of people summarily killed or sent to
the Gulag camps during the rule of Soviet dictator Josef Stalin, RIA news
agency said.

Alexander Yakovlev, father of Mikhail Gorbachev's "glasnost" campaign to
allow more public transparency in the 1980s, said after meeting Putin that
the ex-KGB officer felt the need to thoroughly investigate two decades of
Stalinist repression.

"He takes to heart this tragic period of our history," Yakovlev, who also
heads the Presidential Pardons Commission dedicated to reviewing millions of
arbitrary verdicts in the 1930s and 1940s, told RIA.

Yakovlev, a senior member of the ruling Communist Party politburo under
Gorbachev, said Putin had agreed with his proposal to give the commission a
broader scope.

The president also favored including officials from the Interior Ministry,
the FSB domestic security service, the Defense Ministry and other
institutions whose archives could help the research.

Yakovlev said the commission would comb through newly obtained material to
establish "how many people were ground down by the bloody mill" of Stalin's

Mass executions and imprisonment by the NKVD, precursor to the KGB secret
police, have been publicly condemned in Russia since Gorbachev's time.

But none of the perpetrators has faced trial and investigations have centered
mostly on rehabilitating the victims.

Yakovlev said his commission, set up in 1989 as glasnost was gaining pace,
has rehabilitated more than four million people, some 800,000 of whom are
still alive.

Half a million cases are waiting to be examined, he said.

"But many more people have been executed anonymously, starved or died of
diseases in the camps," Yakovlev said.


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