December 6, 2000   

This Date's Issues:   4671 • 4672

Johnson's Russia List
#4672
6 December 2000
davidjohnson@erols.com

[Note from David Johnson:
1. Reuters: Russian literary prize winner unlikely best-seller.
2. Financial Times (UK): The survival of a Russian realist. Igor Obrosov lost his father to the secret police, and began painting in the 1960s. Today his depictions of Stalin's repressions are finally being shown, writes Andrew Jack.
3. The Globe and Mail (Canada): Geoffrey York, The Internet's Zen pirates. A guru preaching moral cleanliness develops a breed of crime-fighting hackers.
4. Rossiiskaya Gazeta: VLADIMIR PUTIN: NOT TO BURN BRIDGES, NOT TO SPLIT 
SOCIETY. (re state symbols)
5. Bloomberg: Russia's Ryzhkov on Civil Society Condition for Growth.
6. BBC Monitoring: Russian people begin to value human rights.
7. Peter Ekman: Russian trains.
8. Washington Post: Jim Hoagland, Putin's Touchy Timing.
9. AP: Russia's Population To Decline.
10. Jamestown Foundation Monitor: KREMLIN IS MAIN LOSER IN REGIONAL ELECTORAL MARATHON. 
11. Moscow Times: Yulia Latynina, PM Opts for Wrong Way To Cut Taxes.
12. Interfax: Russia to abandon START treaty if USA pull out of ABM.
13. Reuters: Russia's economy could walk unaided in 2001.] 

******

#1
Russian literary prize winner unlikely best-seller
By Brian Killen

MOSCOW, Dec 6 (Reuters) - A Russian emigre living in Switzerland returned 
home to pick up one of his country's most coveted literary prizes at a lavish 
ceremony on Tuesday with a novel so complex it makes Dostoyevsky look like 
light reading. 

The Smirnoff-Booker award for the best novel of the year in Russian, worth 
$12,500 to the winner, went to Mikhail Shishkin for "The Taking of Izmail" -- 
an original work of intense prose with a highly complicated structure. 

At the evening ceremony in a plush Moscow hotel, with vodka flowing freely, 
there were precious few people who had read the 440-page novel, one of the 
favourites from a shortlist of six. 

Shishkin, a bearded 40-year-old, told a news conference he was surprised at 
the jury's decision but he hoped the public recognition would translate into 
new readers. 

"When I was working on this text I thought I had received my prize the moment 
the text came to me," he said. "Every day I felt I received a prize when it 
seemed to me that some word was well chosen." 

The unassuming author, a Muscovite who has lived in Zurich for the past five 
years, said he was realistic about his novel's prospects before it was 
published last year in the Russian journal Znamya (Banner). 

"If it had been rejected, if they had said no normal person could read this, 
it would be the correct thing to do, so I was already happy when Znamya told 
me they would publish it." 

The Smirnoff-Booker prize, an offshoot of Britain's Booker literary prize, 
has been awarded for the past nine years, often for obscure works that have 
failed to stir the public at large. 

Russia's most widely read contemporary writer, Boris Akunin, did not even 
figure on this year's shortlist. 

CRITIC SEES NO BIG PRINT RUN 

Nikolai Alexandrov, literary critic for the Ekho Moskvy radio station, said 
"The Taking of Izmail" would be published in Russia soon by Vagrius, but he 
did not expect big sales. 

"It will be very difficult to promote this author to a mass readership, 
because it is a very difficult novel to read." 

Shishkin himself declined to describe the content or the message behind "The 
Taking of Izmail," saying: "Don't expect me to reply to that." 

When pressed to elaborate on the idea behind the novel, he replied: "No." 

Apparently wanting his work to speak for itself, he told Reuters later that 
it was impossible to use "horizontal language" to explain things in a 
comprehensible way. 

"If someone reads my novel and understands something for themselves I will be 
happy," he said. 

Alexandrov described "The Taking of Izmail" as an unusual novel and an 
attempt to rethink the classical Russian novel, in which there exists a hero 
or cast of heroes around which the central theme is built. 

"Mikhail Shushkin takes a new path," he said, adding that heroes appear and 
disappear, various story lines develop, building up readers' expectations 
before changing tack in a free-ranging journey from one character and episode 
to another. 

Explaining the title of the book, which refers to a late 18th century battle 
between Turkish and Russian troops, Alexandrov said the novel was also about 
someone who approached life with a combative passion. 

"Life has to be lived like you are storming fortress. Life puts obstacles 
boefore you like the defender of a fortress." 

******

#2
Financial Times (UK)
6 December 2000
THE ARTS: The survival of a Russian realist: VISUAL ARTS MOSCOW: Igor Obrosov 
lost his father to the secret police, and began painting in the 1960s. Today 
his depictions of Stalin's repressions are finally being shown, writes Andrew 
Jack 

In a sombre corner of his attic studio in the centre of Moscow, Igor Obrosov 
has built a shrine to his share of personal grief within his country's bloody 
history. He turns on a light to illuminate red memorial ribbons wrapped 
around a series of striking paintings of his family's experiences during the 
Stalinist repressions. 

"Night guest" is dominated by a secret police officer on the way to an 
arrest, with little more detail on his harsh face than on the two stylised 
triangles which make up his trench-coat. "Confession of guilt" has his father 
standing in a cell between two guards, a blank piece of paper and pen 
awaiting his statement. 

The most powerful image, "Waiting", shows no officials at all, just the 
terrible daily fears of Russians at the time. His parents stand awake and 
fully dressed in their flat at four in the morning, watching and preparing as 
a light in the entrance, visible from their window, indicates the imminent 
arrival of a team to drag away the latest victims from somewhere in the 
apartment building. 

Obrosov was just seven years old when his father - a top doctor who was 
active at the time of the Revolution in the Social Democratic party - 
suffered just that fate. He was taken away to a camp in 1937, his 
"confession" unsigned, his execution never clarified but soon evident. 

One of his brothers would follow; his mother survived only because of a rare 
advantage of bureaucratic pedantry. Her marriage had never been officially 
registered and she had kept her maiden name, so officials did not have a 
clear family con nection to justify her detention. But the grief visible on 
her face in subsequent portraits shows just how much she too suffered. 

The history of the paintings themselves is a powerful reminder of how much 
has changed only so recently in Russia. Obrosov began them in secret in the 
early 1960s, but they were excluded from a catalogue of his work published in 
1987. There is just a portrait of his father, taken out of context, amd shown 
alongside a series of equally harrowing, officially sanctioned works of 
Russians during the second world war. 

Attending an exhibition where the pictures were finally displayed in 1989, 
Mikhail Gorbachev, the man who made it possible, stood in front of them for 
20 minutes, says Obrosov. Two of the paintings won him a prize the following 
year. Unlike many Russians, he says he respects the former Soviet leader for 
the changes he brought. 

"All of my work is about metamorphosis and the harshness of life," he says. 
"1937, the war, the destruction of the Russian landscape". For alongside the 
themes of violence against humans, a recurrent topic for him has been the 
countryside, portrayed often through the window of a dacha, showing fields 
with haystacks, crops and farm buildings. 

While he grew up in Moscow, Obrosov found much inspiration in the rural 
region north of the capital, where his mother's family had its roots. Despite 
the charm of the scenery, he sees the countryside as a mirror for a trend 
which is just as gloomy as his other themes. De-kulakisation destroyed the 
peasant class; industrialisation took its toll. So did the war. "From 200 
people in our village, 80 did not come back," he says. "In fact, the Russian 
countryside no longer exists." 

Compared with the tragedy of his family, Obrosov, who was born in 1930 and 
educated at the Stroganov art school in the 1950s, says his own life was 
relatively easy, even if he was repeatedly refused membership of the Russian 
Academy of Arts, until just five years ago. 

But he says he managed to survive while avoiding endless commissions of Lenin 
or more recent political leaders; and he spurned the Socialist Realist style 
decreed as acceptable by the authorities. "I and my contemporaries employed 
Critical Realism or Real Realism instead," he says. "No-one limited me." 

If Stalin's death was followed by a political thaw, its end was signalled 
among other things by the disapproving remarks of Nikita Krushchev at the 
Manezh art exhibition in 1962, when the Soviet leader criticised the abstract 
paintings on show. Obrosov's own stylised still-life picture of lemons, sold 
as a lithograph design at the time, brought him under suspicion. He was saved 
by a respected artist who pronounced the suspect fruit "so real you could eat 
them". 

Rejecting fads in art, his style has remained remarkably similar over the 
years, although his themes have evolved. Apart from the more tragic sources 
of inspiration, ample Russian female nudes recur over the years. "Women are 
the first art," he says with a mischievous grin. 

Today, he is receiving wider recognition, with his pictures hanging in 
galleries in Moscow and elsewhere in Russia, but also in Germany and the US. 
And he has been able to travel abroad, particularly to the stark landscapes 
of Bergen in Norway which he is portraying in a current cycle of paintings. 

But the past continues to haunt him. Many of his powerful, stylised portraits 
are of people to whom he remains closely attached, and whose influence he 
readily acknowledges. He respectfully guards the flowers he first bought 26 
years ago to commemorate the death of his dear friend, fellow artist and 
source of inspiration, Victor Popkov, who was killed in a car accident. 

Reflecting a widespread ambivalence which makes Russians reluctant to simply 
criticise all aspects of the Soviet period, he displays plans for a monument 
that would stand near the Lubyanka, the KGB's former headquarters in Moscow. 
He says it should bear testament to all repressed peoples, of Nazism as well 
as communism. That artistic contribution could help lay his own torment to 
rest. Igor Obrosov's Russian landscapes are on show at the Interkolor 
Gallery, Malaya Dmitrovka St 24/2, Moscow, until late December; a selection 
of his work is due to be shown at the Russian Academy of Art in Moscow early 
next year. 

******

#3
The Globe and Mail (Canada)
6 December 2000
The Internet's Zen pirates
A guru preaching moral cleanliness develops a breed of crime-fighting hackers
GEOFFREY YORK

MOSCOW -- They call themselves the Viper Brothers, the Software Underground 
Empire, and Armageddon in Russia.

They borrow their philosophy from martial arts and Zen Buddhism. They study 
at the feet of a bearded guru known as Arvi the Hacker, or simply the Teacher.

They are the teenaged students of Russia's first school of computer hacking. 
And while their skills and bravado might seem dangerous, they say they are 
the good guys, defending their clients from an international war of viruses, 
hack attacks and computer crime.

The Civil Hackers' School, operating from a shabby little Moscow apartment, 
is helping shape the new generation of Russian computer whiz kids who have 
provoked fear and anxiety in the West.

Russian hackers are blamed for a series of spectacular feats in recent years. 
These include stealing the secret Microsoft source codes; ransacking the 
Pentagon's computers; hacking into Web sites of the North Atlantic Treaty 
Organization; posting thousands of credit-card numbers on the Internet; and 
stealing millions of dollars from Western banks. 

The country's post-Soviet economic collapse, combined with its rampant 
software piracy and its prowess in mathematics education, has created a 
breeding ground for aggressive young hackers. U.S. commentators have 
described the hackers as "perhaps the most talented in cyberspace."

In Moscow, the Hackers' School sees itself at the forefront of a revolution.

"A hacker can do something that influences all of mankind," says the school's 
founder, 27-year-old Ilya Vasilyev, a former software pirate who is better 
known on the Internet as Arvi the Hacker.

"Every country, every company, needs hackers now," the long-haired teacher 
tells his students. "You have a feeling that you can do anything. You don't 
have that in any other job."

Several hundred have studied at the hacker school since 1996, earning 
bracelets with ranks similar to judo belts. (The highest honour is a black 
bracelet, known as "guru level.")

The school, preaching an altruistic moral code, says it trains students for 
legitimate jobs in computer security, defending employers against viruses or 
hack attacks.

"I won't take students when I see they have a criminal tendency," Mr. 
Vasilyev says. "A hacker must be a wise person, like a samurai or a karate 
master. You have to use all of your wisdom not to harm people."

But the temptations are constant. The first lesson for freshmen students is a 
stern warning against illegal hacking.

"Many people read about hackers in the newspapers and they think how great it 
is," Mr. Vasilyev tells the teenagers. "But they don't read to the end of the 
article, where the hacker gets sentenced to jail."

The students sit at the guru's feet on the floor of his cramped apartment. 
When he asks them to name the school's goals, 15-year-old Kirill Boldyrev 
replies, "To break into things."

The teacher quickly corrects him, but later the teenager acknowledges he sees 
hackers as heroes. "They have achieved a very difficult thing, a very unusual 
thing, so they are admired by a lot of people. Maybe it proves that we aren't 
stagnating in Russia, that we are progressing."

The latest hacker exploit was the daring raid on Microsoft, in which the 
secret source codes for the latest Windows program were taken. The raider was 
traced back to Russia's second-biggest city, St. Petersburg, which has become 
a hotbed of hacking.

Russian hackers first captured the world's imagination in 1994 when a young 
mathematician, Vladimir Levin, hacked into the computers of Citibank and 
transferred $12-million (U.S.) to the bank accounts of friends around the 
world. He conducted the entire operation from a computer in his St. 
Petersburg apartment.

He was eventually arrested and jailed, but others were inspired to similar 
feats of cybercrime. Ilya Hoffman, a brilliant viola student at the Moscow 
Conservatory, was arrested in 1998 on charges of stealing $97,000 (U.S.) over 
the Internet. He served a year in jail.

Another group of Russians stole more than $630,000 by hacking into Internet 
retailers and grabbing credit-card numbers. Banking-fraud specialists have 
warned that Russian hackers are the greatest single threat to security at 
European banks.

Crime has become institutionalized in Moscow's outdoor markets and street 
kiosks, where about 90 per cent of the computer software is pirated. The 
widespread acceptance of piracy has made it easier for hackers to ignore the 
law.

"Piracy is prospering, and nobody is fighting it," said Sergei Pokrovsky, the 
25-year-old editor of Khaker, a hacker magazine that has built a circulation 
of 50,000 in just two years of operation.

"Pirate software is for sale everywhere. People get used to the idea that 
piracy is normal. Computer crimes aren't seen as very serious. The police 
have so many other problems on their hands. A lost credit card is seen as 
nothing, compared to murder and all the other crimes in this country."

Because of the shortage of high-paying computer jobs in Russia, even skilled 
specialists can be limited to salaries of just a few hundred dollars a month.

Hacking is a tempting alternative. By stealing a password, they can use the 
Internet for free. And by cracking programs or doing pirate software jobs in 
the evening, they can boost their incomes considerably.

******

#4
Rossiiskaya Gazeta
December 6, 2000
[translation from RIA Novosti for personal use only]
VLADIMIR PUTIN: NOT TO BURN BRIDGES, NOT TO SPLIT SOCIETY
Putin Makes a Statement at a Meeting of the State Council's Presidium

The questions of Russia's state symbols have been under 
discussion in our country for the past ten years. They abate at 
times but then become discussed with renewed strength. They 
seem to have passed into the category of problems of which, 
like of repair work in a house, it is said that they are 
impossible to finish but can only be discontinued.
Normally, under the Constitution, these symbols of the 
state - it concerns the coat of arms, the flag and the national 
anthem - must be approved by a law. Regrettably, they still 
exist in our country in a temporary regime and were introduced 
by a presidential decree alone.
Why have not corresponding laws been adopted until now? 
The answer is known and is simple enough: because two positions 
still dominate both society and the State Duma.
These positions are poles apart and diametrically opposite.
One point of view boils down to the idea that today we may not 
use the symbols of pre-revolutionary tsarist Russia of the time 
prior to October 1917.
Others believe that we cannot use the symbols of the 
Soviet period of our state's existence.
The former claim that, say, a tricolour - the traditional 
three-colour Russian standard - may not be used because during 
the Great Patriotic War it was inappropriately used in the 
struggle against our people. And, in general, how is it 
possible to use, for instance, the coat of arms of the Russian 
empire because in the past the Russian empire was called - not 
groundlessly, I want to emphasize, a "prison of peoples" in 
which its own repressed people and its own people holding 
different views did exist, too?
The situation with the Soviet-era symbols is even more 
complicated. And it is even more complicated because people who 
have experienced all the horrors of Stalin's camps are still 
alive and, of course, we cannot ignore their opinion.
But I want to note that both the former and the latter, 
the holders of both of these points of view, try to prove that 
they are right by using the same logic. Because they are 
maximally ideologize these symbols of the state. They associate 
the gloomy times in the history of our country with these 
symbols. And there have always been such times. There have 
always been times when the authority treated its people with 
unwarranted toughness, and its actions could not be recognised 
as just.
But if we are guided only by this logic we must forget 
also our people's achievements for centuries. Where shall we 
then put the achievements of Russian culture? Where shall we 
put Pushkin, Dostoyevsky, Tolstoi and Tchaikovsky? Where shall 
we put the achievements of Russian science - Mendeleyev, 
Lobachevsky and many, many others? Much of what all of us take 
pride in - what shall we do with all this? And their names and 
their achievements were also linked with these symbols!
And do we really have nothing, except the Stalin camps and 
repressions, to recall for the whole Soviet period of our 
country's existence? Where shall we then put Dunayevsky, 
Sholokhov, Shostakovich and Korolyov and the achievements in 
outer space? What shall we do with Yuri Gagarin's flight, as 
well as the brilliant victories of the Russian arms - from the 
times of Rumyantsev, Suvorov and Kutuzov? And the victory in 
the spring of 1945?
If we give thought to all this, we will admit that we not 
only may but also must use all the main symbols of our state 
today. It is a different thing that they must be properly 
formalized and systematized. And a befitting place should be 
found in this row to the red banner, too, since the standard of 
our people's Victory in the Great Patriotic War was precisely 
of this colour.
The draft laws on the state symbols have been submitted to 
the State Duma. We propose the traditional Russian three-colour 
standard - a tricolour - as the flag. It is already more than 
300 years old.
I shall ask the deputies of the State Duma to approve the 
music by Alexandrov - the melody of the former Soviet anthem - 
as the national anthem.
And I shall ask the deputies of the State Duma to approve 
the traditional Russian double-headed eagle as the coat of arms 
- it is already about 500 years old.
The red banner may become the official standard of the 
Armed Forces of Russia.
In recent time especially heated debates have been going 
on around the anthem - the former Soviet anthem to Alexandrov's 
music. All of us know the results of the public opinion poll. A 
vast majority of Russian citizens give preference to precisely 
this melody. I want to address those who do not agree with this 
decision. I ask you not to dramatise events, not to erect 
insurmountable barriers, not to burn bridges, and not to split 
society once more.
If we accept the fact that in no way could we use the 
symbols of the previous epochs including the Soviet one, then 
we must admit that our mothers and fathers lived useless and 
senseless lives, that they lived in vain. I can't accept it 
either with my mind or my heart.
There was already a period of time in our history when we 
rewrote everything anew. We can act in the same way today, too. 
We can change the flag, the anthem and the coat of arms.
But in that case it would certainly be right to call us 
rootless creatures.
Let us direct all our tireless energy and our whole talent 
not to destruction but to creation. And then, I am absolutely 
sure, most of our ideas, most of our desires will materialize, 
and a sweeping majority of all the tasks facing us will be 
accomplished.
I am sure that we will manage to do this.

******

#5
Russia's Ryzhkov on Civil Society Condition for Growth: Comment

Moscow, Dec. 6 (Bloomberg)
-- Vladimir Ryzhkov, a deputy in Russia's lower house of parliament, 
made the following comments on the conditions needed to improve the country's 
investment climate and achieve sustainable economic growth. He spoke at a 
conference. 

``We can create wonderful laws, we can create a non-corrupt, effective 
bureaucracy and government apparatus, we can balance out and concentrate all 
government efforts -- but without a society, without a good worker, who has 
values, who treats his work consciously and has a modern education and 
conscience. . .all of this will be useless. 

``I think that we have to remember that investment attractiveness of Russia 
will be built from the quality of the society, the quality of Russian men. 

``Companies don't have the right workers, or specialists. The quality of the 
workforce in Russia is a cause for serious concern as is the quality of 
equipment and laws. 

``Russia cannot achieve qualitative economic growth without qualitative 
improvement in the judicial system and courts. This is all talk for now 
unfortunately. So far there is no improvement in the courts and there is no 
concept as to how to improve the situation in the courts. 

``Without serious local self-government it is impossible to have good civil 
society and social stability of the country. Our media are not 
self-sustaining. Not a single TV channels is profitable. The government is 
subsidizing (state-controlled) RTR with $100 million. . .to keep it afloat. 
How can we speak of an information openness of the country?'' 

******

#6
BBC Monitoring
Russian people begin to value human rights 
Text of report by Russian Ren TV on 4th December 

[Presenter] The right to vote is one of the main values of democratic 
countries. And Russia, it appears, is among them. At least, human rights 
activists are celebrating the somewhat pained reaction of Russian citizens to 
the limitation of the right of choice: all this was said at an awards 
ceremony for human rights actions. 

[Correspondent] Journalists from 'Novaya Gazeta' are among the few people to 
receive awards for taking a stance of principle in protecting human rights: 
this includes materials from Chechnya. Russian ombudsman Oleg Mironov said 
that today human rights violations were of everyday and nearly applied nature 
while flowers were being laid to the Solovetskiy Stone in Lubyanka Square in 
the morning. 

[Mironov] People stop feeling themselves personalities when there is no 
heating and light and the people's belief in the future is lost. 

[Lyudmila Alekseyeva, captioned, the chairwoman of the Moscow Helsinki group] 
There were rather many appeals about violations of voting rights of citizens 
in the latest elections. The citizens have begun to value the rights. Then, 
such civic rights as soldiers' rights that, as is known, are protected by 
soldiers' mothers and human rights activists in general rather than soldiers 
themselves. There are rights of refugees. 

[Correspondent] Two years ago Russian human rights activists opposed 
adamantly to Mironov's appointment to the newly created post of ombudsman. 
Today people think that this state structure is beginning little by little to 
fulfil its function. 

[Alekseyeva] And I do not blame him that this does not change the situation 
instantly. A word is a deed but it slowly affects changes. Strictly speaking, 
the ombudsman's weapon is a word. 

[Corespondent] Incidentally, still another anniversary will be marked 
tomorrow. The first human rights rally took place in Pushkin Square in Moscow 
35 years ago sharp. 

[Video shows a meeting, people in a square] 

******

#7
From: "Peter D. Ekman" <pdek@co.ru>
Subject: Russian trains
Date: Wed, 6 Dec 2000 

In response to Matthew Fisher's (JRL 4671, #4) article from the
Toronto Sun "Russian trains a traveling circus Overcrowded and 
cockroach infested, they are a universe unto themselves."

In general I've always found Russian overnight trains to be
reasonably comfortable and definitely as interesting - if not
more so - than Fisher describes. I can't recall seeing a cockroach
on one - but they are quite common in Moscow so it wouldn't be
a memorable event. The toilets by the end of the trip may
"defy polite description," as Fisher says, but are usually several
steps above the usual Moscow restroom.

Fisher described "hard class" which I take to mean "platskart."
There are 4 classes in Russia: "luxe" - 2 people to a compartment,
"coupe" - 4 people to a compartment, "platskart" - open bunks with
matresses, and "obshii" - open bunks without matresses

I've made more than a dozen trips throughout European Russia,
from Kem on the White Sea to Sochi, Pskov to Chelyabinsk, and
always found the trips to be comfortable and interesting, except
for the only time I left coupe class for obshii (from Pskov to Moscow) 
which I'll just describe as interesting. The longer trips can certainly
wear you down - but most destinations are just an overnight
trip from Moscow. The prices, at about $20 for an overnight trip,
are very cheap considering the service.

The best or worst part of the trips are always your fellow travelers.
If you get a real turkey in the same coupe - you can always go
to the restaurant car (which vary in quality from good to
Amtrak standard).

The only complaints that I have are that it can be difficult to buy
a ticket and that everybody needs to show their passports to buy
tickets and to get on the train.

*****

#8
Washington Post
December 6, 2000
[for personal use only]
Putin's Touchy Timing
By Jim Hoagland

Russia's President Vladimir Putin will travel to Cuba next week on a journey 
that underlines the "assertive but positive" attitude he will adopt with the 
next president of the United States, according to a senior Russian official. 

The timing of the trip--initially disclosed by U.S. sources--is ruffling 
feathers in the outgoing Clinton administration. Putin seems to some to be 
taking advantage of the post-election limbo in Washington to poke a thumb in 
Washington's eye.

There are also questions about Putin's including the head of Russia's atomic 
energy ministry on the trip. The Russian president will fly across U.S. 
airspace after visiting Havana to start a visit to Canada on Dec. 15.

The timing of the North American trip is unrelated to U.S. politics, the 
visiting official and other Russian sources insist. It was originally set in 
September after Putin saw Cuban President Fidel Castro at the United Nations 
and postponed when Cuba needed more time to prepare.

Putin's biggest interest in the trip is described not as geopolitics but as 
finding ways to get Cuba to pay back its large Soviet-era debt. But Putin's 
decision to go ahead with the politically sensitive Cuba trip now as 
uncertainty lingers over the presidential election here is an unintended 
signal of its own.

Russia and other nations are factoring into their policies the effect of the 
contested presidential election and a more evenly divided Congress. 
Inevitably, they see room to pursue their interests with more assertiveness. 
Some nations are openly intensifying their challenge to U.S. power during the 
limbo.

Iraq has shut off oil exports to back up its campaign against economic 
sanctions. Iran has stepped up support for Islamic guerrilla operations 
against Israel. Libya has effectively neutralized the international travel 
ban that Washington has sought to keep in place.

In his first year, Putin has worked to deepen Russian ties with those three 
countries and with other Soviet-era clients. In his quest to collect back 
debts and open new markets for the Russian economy, he seems unconcerned 
about appearing to President Clinton and others to revive problems of the 
past rather than cooperate with the United States on the future in the 
world's regional conflicts.

Putin's outlook on future cooperation with Washington is "assertive but 
positive," the visiting Russian official countered, insisting that Putin's 
active Third World diplomacy is not directed against the United States.

The Russian president used a visit to North Korea "to introduce Kim Jong Il 
on the world stage as a different person," he continued. During her recent 
visit to Pyongyang, Secretary of State Madeleine Albright pursued proposals 
Putin originally made to restrain North Korean missile development. "Some 
Western leaders have actually thanked President Putin for what he did."

Moscow and Washington resume talks at the expert level this week on Russia's 
conventional arms sales to Iran, even though Russia on Dec. 1 formally 
canceled a secret U.S.-Russia understanding that sought to restrain those 
sales, the official added.

"Our attitude is not based on a memorandum. We can find ways to cooperate 
without that. We continue to talk to Washington about U.S. concerns and try 
to understand them. We may not agree on all points, but we want a full and 
continuing dialogue with the next administration on this and other points, 
including arms control," the official said.

His comments, which were delivered with an unusual authority and precision 
for such semi-public utterances, sought to emphasize common points of 
interest both in Third World diplomacy and arms control. The official 
sketched a rationale for Russian constructive engagement with troublesome 
states.

"After all, President Clinton seemed at one point in his presidency to hope 
to visit Cuba, and maybe North Korea. When he was secretary of state, Jim 
Baker discussed how Moscow might help the United States normalize with Cuba. 
And Cuba occupies historically a certain relationship with us. This is not 
intended as a signal."

But this official acknowledged that the campaign and the Nov. 7 election 
results create new questions about Washington-Moscow ties that echo into 
world politics at large.

"With dialogue, we can get past" the campaign stereotype "that this 
relationship was conducted by a bunch of crooks in the Kremlin and a bunch of 
romantics in Washington. We averted more crises than is known, and created a 
basis for moving forward with the next administration."

But there is a new risk created by the disputed election and the nearly even 
partisan divisions of the Senate and House, he concluded: "Foreign policy is 
always an easy target in time of domestic troubles, in any nation."

That is one reason Putin should have considered delaying the Cuba trip again. 
It may not be intended as a signal to Washington. But it will be an early 
window on a relationship that seems headed for more challenging times.

*******

#9
Russia's Population To Decline
December 5, 2000
By VLADIMIR ISACHENKOV

MOSCOW (AP) - The steady decline of Russia's population, unprecedented for an 
industrialized nation not at war, is likely to last for decades to come, the 
head of the government statistics agency said Tuesday. 

``The population decline, which started in 1992, will continue for many 
years, maybe decades, maybe even a half-century,'' Vladimir Sokolin, the head 
of Russia's State Statistics Committee, said at a news conference. 

Russia's population has dwindled by 3.3 million since the 1991 Soviet 
collapse to about 145 million as of Oct. 1. In the first nine months of this 
year alone, the country lost 550,600 people. The State Statistics Committee 
forecasts that the population will shrink by 11 million more people in the 
next 15 years. 

While some factors behind the trend, such as the falling birth rate, are 
similar to those in Western nations, experts point to economic depression as 
the key reason for the population decline. Dismal economic conditions in the 
1990s have led to a dramatic plunge in living standards, a steady 
disintegration of the state health care system, and a corresponding rise in 
mortality. 

According to the latest report from the State Statistics Committee, Russia's 
overall average life expectancy fell by about three years during the last 
decade to 66 years in 1999. The rate for men was 60 years, 10-15 years less 
than in Western countries, while the average life expectancy for women was 72 
years, six to eight years less than in the West. 

``The gap between life expectancy for men and women in Russia is one of the 
widest in the world,'' said Irina Zbarskaya, the head of demographics 
research at the State Statistics Committee. Experts have attributed the gap 
to increasing alcohol abuse that has taken a harsh toll on Russian men. 

The decline in health care has resulted in a high number of deaths of babies 
up to a year old, far exceeding the level in Western countries. Russia's 
infant mortality rate, which reached its peak with 20 deaths per 1,000 births 
in 1993, has since dropped, reaching just under 16 per 1,000 births last 
year. But that was still shockingly high compared with the U.S. infant 
mortality rate of about 7 deaths per 1,000 births in 1999. 

``The infant mortality rate that Russia has is extremely high for a developed 
country,'' Zbarskaya said. 

The drop in population has been partly compensated by an inflow of 
immigrants, mainly ethnic Russians from other former Soviet republics. But 
immigration has slowed down, Zbarskaya said. 

*******

#10
Jamestown Foundation Monitor
December 5, 2000

KREMLIN IS MAIN LOSER IN REGIONAL ELECTORAL MARATHON. December 3 saw voting 
for regional executives in no fewer than eleven of the constituent 
republics and regions of the Russian Federation. Once again, the Kremlin 
failed to score a single decisive victory. Four of the elections were 
completed in just one round. In Astrakhan Oblast, incumbent Governor 
Anatoly Guzhvin scored an easy win with 81.4 percent of the vote. It was 
the same in Krasnodar krai, where Aleksandr Tkachev, "heir" to former 
Governor Nikolai Kondratenko, scored 81.9 percent. In other regions, 
incumbents were defeated: in Perm Oblast, Governor Gennady Igumnov lost to 
Perm Mayor Yuri Trutnev (scoring 35 percent to Trutnev's 51.3). In the 
Koryak autonomous district, Russia's only woman governor, Valentina 
Boronevich, lost to local businessman Vladimir Loginov (33 percent to his 
50.8).

In the remaining regions, no candidate won more than 50 percent of the vote 
and run-off elections will have to be held.

--In Arkhangel Oblast, incumbent Governor Anatoly Yefimov won 49.7 percent 
and Nikolai Malakov, former head of the regional government, won 32.3 
percent.

--In Ivanov Oblast, local Communist leader Vladimir Tikhonov received 49 
percent and the chairman of the oblast government, Anatoly Golovkov, 32.4 
percent.

--In the Republic of Marii-El, incumbent president Vyacheslav Kislitsyn won 
26.7 percent and local businessman Leonid Markelov 27.6 percent.

--In Kamchatka Oblast, Deputy Governor Boris Sinchenko, official "heir" of 
former Governor Vladimir Biryukov, received 27.7 percent and Maksim 
Mashkovich, leader of the region's Communists, 20.5 percent.

--In the Komi-Permyak autonomous district, incumbent Governor Nikolai 
Poluyanov received 25 percent and Gennady Savelev, head of the Perm Oblast 
Audit Chamber, 26 percent.

--In Ryazan Oblast, incumbent Governor Vyacheslav Lyubimov won 44.9 percent 
and Valery Rymin, a local businessman, 12 percent.

--In Stavropol krai, incumbent Governor Aleksandr Chernogorov won 28.5 
percent and Stanislav Ilyasov, former chairman of the krai government, 19 
percent.

All of these elections passed off without serious incident. The only 
exception was Kamchatka, where Vladimir Kruze, a lawyer well known in the 
region, was found murdered outside a polling station. Local observers 
believe it was a contract murder, though no evidence for that assertion has 
yet been produced (NTV, December 3).

Contrary to the expectations of many observers, there was no repeat of 
October's "Kursk scenario," which saw the incumbent, Kremlin bugbear 
Aleksandr Rutskoi forced out of the race by a court order. Several such 
attempts were made, however. One involved the incumbent governor of 
Stavropol Krai, Aleksandr Chernogorov. A rival candidate, Vasily Krasulya, 
member of the Union of Right-Wing Forces, accused Chernogorov of providing 
the local election authorities with erroneous information concerning his 
property--specifically, underreporting the size of his apartment--and 
managed temporarily to get Chernogorov excluded from the race (Russian 
agencies, November 29). However, a superior court confirmed that 
Chernorgorov's property declaration had been inaccurate, but ruled that 
this was not enough to disqualify him from the race. Krasulya is 
threatening to appeal to the Supreme Court (Radio Ekho Moskvy, November 30).

The Kremlin made a more serious effort to get a court to disqualify the 
candidacy of Marii-El incumbent President Kislitsyn, long a thorn in the 
Kremlin's side (Russian agencies, December 2). Its aim: to prevent 
Kislitsyn--"a barefaced hooligan," as he has been characterized in Kremlin 
corridors--from winning a second term. First, Kislitsyn's loyal officials 
were forced out of their posts. Next there were threats that court cases 
involving Kislitsyn would be activated and that surveillance tapes showing 
him meeting with local crime bosses would be shown to the public (Obshchaya 
gazeta, October 5). Kislitsyn himself began to express doubts that he would 
participate in the election (Russian agencies, October 31). Finally came 
his meeting with Sergei Kirienko, Putin's authorized representative in the 
Volga federal district. Members of Kirienko's entourage claimed: 
"Kislitsyn's come to throw in the towel" (Russian agencies, October 31). It 
soon became clear, however, that the Kremlin team had mistaken their desire 
for reality. Not only did Kislitsyn not throw in the towel: Despite 
everything, he joined the race and declared his determination to win. A 
last-minute attempt to get his registration as a candidate revoked came to 
nothing.

It comes as no surprise that the trickiest situations involving heating and 
lighting are occurring in regions run by governors whom the Kremlin does 
not like, such as Primorsky krai and Ulyanovsk Oblast. On November 23, the 
hot water was turned off in Yoshkar-Ola, capital of the Marii-El Republic. 
The official explanation was that spending limitations on gas had been 
exceeded and that the city budget was deep in debt (Radio Ekho Moskvy, 
November 23). The energy crisis did not of course increase the popularity 
of the republic leadership in the eyes of the voters; even so, it turned 
out to be insufficient to unseat Kislitsyn.

The "Kursk scenario" was employed much more successfully by the governors 
themselves against their political opponents. On December 1, a court 
decision removed the favorite from the election for mayor of Krasnodar: 
Incumbent Valery Samoylenko was accused of abusing his official post during 
the campaign (Vremya novostei, Radio Ekho Moskvy, December 1). The mayoral 
election was held at the same time as the election for mayor of Krasnodar 
krai. On this occasion, however, incumbent Governor Nikolai Kondratenko, 
infamous for his anti-Semitic utterances, opted out of the race "on health 
grounds" (meaning, in the view of most observers, under pressure from the 
Kremlin). Many commentators saw Kondratenko's decision to withdraw as one 
of the most important events of the electoral season (Obshchaya gazeta, 
November 16). Kondratenko, however, chose his own successor--Aleksandr 
Tkachev, chairman of the State Duma's nationalities committee, who is no 
less odious a nationalist than Kondratenko himself. Even in Krasnodar, 
therefore, the Kremlin failed to score a complete victory. Indeed, when 
Kondratenko's supporters tried to coax him into running for re-election, he 
said he saw no sense in doing so, since by "burying Samoylenko" he had 
achieved his main aim (Radio Ekho Moskvy, December 1).

To be fair, it should be noted that not all of the governors running this 
time around were able to employ the "Kursk scenario" effectively. On 
November 29, a court in Arkhangel Oblast refused to overturn the 
registration of Nikolai Malakov, main challenger to incumbent Governor 
Anatoly Yefremov. Yefremov's personal representative accused Malakov of 
violating election law, but the court declined to uphold the complaint 
(Russian agencies, November 30).

The December 3 gubernatorial races provided graphic confirmation that the 
governors are no longer afraid of Putin, because the Russian president has, 
as before, no means of opposing them on their own ground. The "Kursk 
scenario" turned out to be an imaginary threat, just like all the Kremlin's 
previous threats. If truth be told, the "Kursk scenario" was not even 
really applied in Kursk, given that victory there was won not by the 
Kremlin, but by Rutskoi's local opponents. In regions where the governor's 
power is strong, the Kremlin is powerless to unseat him.

******

#11
Moscow Times
December 6, 2000
PM Opts for Wrong Way To Cut Taxes
By Yulia Latynina 

The windfall of high global energy prices has fallen on 
Russia like manna from heaven. The country could do many things with the 
extra billions of dollars it has come into. It could carry out pension 
reforms, for instance. Or housing reform. Or pay down its international debt. 

But the government has chosen a different path: The path of increasing its 
own future obligations. It has promised to increase salaries to military 
personnel and other state employees. It has promised to pay off the debts of 
building the High-Speed Railway between Moscow and St. Petersburg. 

Now it is the defense industry's turn. Prime Minister Mikhail Kasyanov has 
pledged to pay out 32 billion rubles by the end of January, half in cash and 
half in state bonds. 

The state has wracked up 32 billion rubles in debt to the defense industry. 
Some debts go back as far as 1995. However, this overall figure is made up of 
several different kinds of debt. Part of it is payment owed for items 
purchased by state order. In these cases, money was set aside in the budget 
but never released by the Finance Ministry. No one can dispute the need for 
paying off these obligations.

However, much of the state "debt" to the defense industry is for tanks, 
planes and other equipment that was not ordered but was just manufactured by 
sheer inertia. In some cases, the factories produced the equipment on 
agreement with the Defense Ministry, even though the purchase was not 
included in the budget or approved by the State Duma. In these cases, the 
Finance Ministry has been absolutely correct in refusing to pay.

The absence of a state order has never been an obstacle for the directors of 
our military-industrial complex. "If there's an order, we'll make it," is 
their motto. "If not, we'll make it anyway." And then they begin to complain 
bitterly that they aren't being paid for their wares. We should keep in mind 
that at least half of the 32 billion-ruble figure is debt that was never 
sanctioned by the Finance Ministry. Paying this debt will merely compound the 
irresponsibility of the situation. However, in this case irresponsibility may 
prove profitable.

Since 1995, the essence of much of the state debt to the defense industry has 
been myriad tax-evasion schemes. Instead of paying cash for its debts, the 
state has offered defense plants a variety of "cash surrogates" such as 
promissory notes and tax privileges. The factories in turn sold off these 
surrogates at a discount to the biggest tax-debtors in the country — the 
oligarchs. The oligarchs, in turn, used them at face value to pay off their 
taxes. 

Kasyanov is now proposing a similar scheme. Half the state's debt will be 
paid in cash and half in bonds. Here's how it will work:

First, the state issues about $500 million in bonds. Next, the government 
signs a secret decree authorizing the use of these bonds for the payment of 
taxes. A few select banks are authorized to facilitate this process. Then 
these banks buy up all the bonds from the defense plants at about 20 percent 
of face value and, finally, they sell them at about half of face value to big 
tax-debtors who hand them back to the state at their full value.

Reducing taxes is probably a good thing. But it would be a lot better to do 
it fairly by means of the Tax Code. 

Yulia Latynina is the creator and host of "The Ruble Zone" on NTV television.

******

#12
Russia to abandon START treaty if USA pull out of ABM 
Interfax 

Moscow, 5th December: A Russian parliamentary delegation said at an 
international meeting that Russia would "immediately" withdraw from the 
START-II Treaty if the United States renounces the Anti-Ballistic Missile 
Treaty, a senior Russian parliamentary deputy said on Tuesday [5th December]. 

The Russians issued this warning at a meeting in Berlin of a trilateral 
commission that includes the heads of the international affairs committees of 
the Russian, French and German parliaments, Leonid Slutskiy, deputy head of 
the international affairs committee of the Russian lower house, told 
Interfax. 

Another deputy head of the Russian committee, Aleksandr Shabanov, who, like 
Slutskiy, is a member of the nationalist Liberal Democratic Party, voiced 
this warning at the meeting. 

Initially, the French and German representatives took the warning as an 
"ultimatum and as an attempt to intimidate" the West, but "the sides came to 
understand each other" toward the end of the talks, and the French and 
Germans agreed with much of Russian reasoning, Slutskiy said. 

Relations between Russia and the European Union were also on the agenda, 
Slutskiy said. The negotiators "reached a common denominator: the 
rapprochement of countries that are members of the EU and Russia is an urgent 
necessity". 

The situation in the North Caucasus and the Balkans also came up. "Opposition 
to us was a lot weaker at that meeting than it had been at similar meetings," 
Slutskiy said. 

He said the commission for refugees of the Council of Europe Parliamentary 
Assembly (PACE) is due to meet in Paris on Friday and the PACE political 
commission will convene in Riga on Saturday. 

Whether a PACE session in January will return the right to vote in the 
assembly to Russia largely depends on those meetings, Slutskiy said. 

Russia lost this right after the Council of Europe accused Moscow of failing 
to follow PACE recommendations on reducing the Russian military presence in 
Chechnya. 

Slutskiy also said that a French-German-Russian delegation is likely to visit 
Kosovo in April. 

He said the trilateral commission or "the European Parliamentary Initiative, 
as we call it today, may very soon be joined by representatives of the 
[parliamentary international affairs] committees of Italy and Great Britain". 

Slutskiy said the commission is due to hold its next meeting in Paris in 
April next year. 

Russia's lower house ratified START-II this year. 

******

#13
YEARAHEAD-Russia's economy could walk unaided in 2001
By Samantha Shields

MOSCOW, Dec 6 (Reuters) - Russia's economic recovery has strong enough roots 
to survive a drop in the oil price, but the government still hopes for 
external help to pay off foreign debt and sustain record post-Soviet growth 
in the New Year. 

Russia is a major exporter of oil and gas, as well as nickel, aluminium and 
copper and its recovery from the August 1998 financial crisis has been partly 
due to the fact that prices for those commodities have been at historical 
highs at various points in 1999 and 2000. 

But analysts in Moscow said political and fiscal stability, kick-started by 
the devaluation of the rouble, will allow economic growth to weather even a 
relatively sharp fall in the price of benchmark Brent crude oil next year. 

"There seems to be a rather oversimplified cause and effect pattern drawn 
between oil prices and Russia -- if oil prices are high then Russia's going 
to be okay but if oil prices are low Russia's in trouble," Roland Nash, chief 
economist at Renaissance Capital, said. 

Nash acknowledged that oil prices were important but said the key factor 
driving the recovery had been the rouble devaluation. 

He added that continuation of the recovery would depend on Russian firms 
investing enough to restructure and the government creating an economic 
environment allowing them to recover. 

GDP GROWTH HEALTHY, INFLATION SLOWING 

Russian Prime Minister Mikhail Kasyanov on Friday forecast economic growth at 
seven percent this year and predicted that inflation would fall in 2001 to 
between 12 and 14 percent from no more than 21 percent in 2000. 

The 2001 budget draft, Russia's first post-Soviet balanced budget, so far 
making its way smoothly through parliament, envisages gross domestic product 
growth of four percent and consumer price inflation of 12 percent. 

However, the document makes no provision for about $3 billion in debt 
payments due next year to the Paris Club of creditor nations and the 
government is still waiting for the International Monetary Fund to give the 
go-ahead for restructuring talks. 

In the absence of a restructuring deal, the Kremlin might still be largely at 
the mercy of fickle world markets. 

The most recent Reuters poll of 15 analysts, conducted in late September when 
the oil price was at 10-year highs of $34.50 per barrel, forecast the price 
would average $23.45 in 2001. Russia's budget draft is based on a price of 
$21 per barrel. 

"The oil price only needs to remain above $20 a barrel for investment and 
reform to remain the drivers," Nash said. 

Estimates of how dependent Russia is on oil are varied and changing because 
of economic recovery and taxation reform. 

Official figures show oil usually accounts for about eight percent of Russian 
GDP and gas also eight percent, with each sector contributing about 25 
percent of annual tax revenues. 

But Stephen O'Sullivan, oil analyst at United Financial Group, said the 
picture was changing. 

"Oil is becoming a smaller share of the total economy and we're moving from a 
direct to an indirect tax system so it also becomes a smaller proportion of 
tax revenue," he said. 

LOWER OIL PRICE COULD ATTRACT INVESTMENT 

Analysts said a drop in the oil price in 2001 could actually attract 
investment to Russian equities as it might reduce fears of adverse market 
developments waiting around the corner. 

"A reduction in the perception of global risk would be caused by many things, 
but one of them would be a fall in the oil price to more moderate and 
sustainable levels, which would leave people more comfortable about putting 
their feet back in the water," O'Sullivan said. 

Another key component of Russia's trade balance is metals. 

Analysts estimated ferrous and non-ferrous metals would account for between 
five and seven percent of Russia's GDP in 2000, but the influence of 
fluctuations in world metals' prices on the economy as a whole is less 
significant. 

Metal prices on the London Metal Exchange (LME), which acts as the world 
benchmark for non-ferrous metals, have already come off their peaks this year 
without pulling Russian indicators down on their coat-tails. 

Nickel's official LME three-month price was $7,220/$7,225 a tonne on Tuesday, 
down from the year's high at $10,480 a tonne, while copper was at 
$1,858/$1,859 from its $2,036 high and aluminium at $1,520/$1,521 from 
$1,668. 

******* 

CDI Russia Weekly:  http://www.cdi.org/russia

Johnson's Russia List Archive (under construction):  http://www.cdi.org/russia/johnson