September 22, 1999   
This Date's Issues: 3517 • 3518 •   

Johnson's Russia List
#3517
22 September 1999
davidjohnson@erols.com


[Note from David Johnson:
1. Bloomberg: Former US Ambassador to the Soviet Union on Russia.
(Jack Matlock).
2. Reuters: U.S. lawmakers warned of Russia corruption dangers.
3. Moscow Times EDITORIAL: New Bombs Won't End Old Conflict.
4. AFP: Moscow seeks aid of erstwhile Cold War foes.
5. St. Petersburg Times: Brian Whitmore, Millennium Madness Hits Moscow
Early.
6. Reuters: Russian citizen challenges Luzhkov's right to run.
7. AP: Yeltsin's Abilities Questioned.
8. Peter Reddaway: The Current Debate on US Strategy Towards Russia.
9. Adrian Helleman: More on governance in Russia.
10. RFE/RL: Russia: Sophie Lambroschini, Kremlin Maneuvers For Loyalty Of 
Large Companies Before Election.
11. Reuters: U.S. business rep says Russia good place to invest.
12. Ray Finch reviews Timothy Harper's Moscow Madness.
13. The Annual World Convention of the Association for the Study of
Nationalities' convention: Identity and the State: Nationalism and 
Sovereignty in a Changing World.] 


*******


#1
Former US Ambassador to the Soviet Union on Russia: Comment

New York, Sept. 21 (Bloomberg) -- Jack 
Matlock, former U.S. ambassador to the Soviet Union, spoke on financial news 
network CNBC about political and economic turmoil in Russia and rumors 
Russian President Boris Yeltsin will resign before his term ends next summer. 
Matlock also commented on the op-ed column by former Secretary of the 
Treasury Robert Rubin in today's New York Times that discussed Russia. 


``Obviously, they are having great difficulties with the terrorist attacks 
and that puts people on edge and rightly so. They have an unpredictable 
president. I don't put much stock in these resignation rumors.'' 


``If there is a good side to this, it is that Russians are learning to live 
by their own resources and not expect the government to do everything for 
them.'' 


``There are a lot of political risks, and I'm not trying to minimize them. 
But you know, this is a country that despite the bank and financial crash in 
August of last year ... we see now production rising, we see that markets for 
consumer goods have stayed fairly stable despite the inflation brought on. We 
did not see an economic collapse. And smaller business, I think, is actually 
improving. This is not to deny that the problems are not there, but I think 
one can exaggerate them.'' 


``Obviously you want to follow up on such things as the money laundering, and 
investigate that and prosecute when you have the evidence.'' 


``I think (Robert) Rubin is exactly right. We need to stay engaged because 
the stakes are simply too high. We are not going to have peace or stability 
in the world if Russia doesn't move in the direction of democracy in a normal 
government. They have to do it for themselves.'' 


``We can either help or hurt and I think we should, to the degree that we 
responsibly can, be helping.'' 


*******


#2
U.S. lawmakers warned of Russia corruption dangers
By Donna Smith

WASHINGTON (Reuters) - Russia policy experts warned U.S. lawmakers on Tuesday 
that widespread corruption and organized crime in Russia could pose a serious 
threat to the United States and the rest of the world if left unchecked. 


Several experts told the House Banking Committee that corruption and 
organized crime took root in Russia well before the collapse of the Soviet 
Union and was spread throughout all aspects of government, business and 
banking operations. 


Richard Palmer, a former CIA station chief who heads Cachet International 
Inc., a firm that specializes in asset recovery and business intelligence, 
said that corruption in Russia is more pervasive than commonly believed. 


``For the United States to be like Russia is today, it would be necessary to 
have massive corruption by the majority of the members of Congress as well as 
by the Departments of Justice and Treasury,'' Palmer testified. 


Corruption would also have to be widespread among law enforcement agents of 
all types, judges, the Federal Reserve Bank, the New York Stock Exchange, 
leaders of major companies and at least half of the banks in the United 
States, he said. 


The banking committee is looking into allegations that Russian businessmen, 
organized crime figures and government officials laundered up to $15 billion 
through the Bank of New York. 


COMMITTEE AIMS ``TO HELP RUSSIA'' 


Palmer joined other Russia experts and Treasury Secretary Lawrence Summers to 
testify at the first of what panel Chairman James Leach has said will be a 
series of hearings. 


``This is a hearing designed to help Russia and the Russian people; it is not 
a hearing designed to embarrass anyone,'' Leach, an Iowa Republican, said 
before offering reassuring words in Russian. ``We want to look to Russia as a 
country with a great future, not as a country that appears to be imploding 
from within.'' 


Russia has described the allegations as part of a broader politically 
motivated campaign to smear the country and deprive it of further 
international assistance. U.S. Lawmakers have raised concerns that the some 
of the laundered money was money provided by the International Monetary Fund 
to help stabilize Russia's battered currency and economy. 


Russian officials have said the money was more likely to come from trading 
firms channeling payments through foreign banks to avoid Russian taxes rather 
than from organized crime. 


UNPRECEDENTED CORRUPTION AND MONEY LAUNDERING 


But former KGB intelligence officer Yuri Shvets said in testimony to the 
banking committee that money laundering and organized crime in Russia have 
reached ``unprecedented'' levels. 


``Institutionalized crime ruins Russia,'' he said. ``It represents a serious 
threat to the whole world given Russia's vast territory and huge arsenals of 
weapons of mass destruction and nuclear power plants,'' Shvets said. 


Former CIA director James Woolsey said organized crime and corruption could 
destabilize Russia, which remains a nuclear power capable of destroying the 
United States, and has turned many Russians against the United States. 


``In their eyes, we are the supporters of those who have stolen much of their 
national patrimony through a highly-corrupted privatization process and we 
are, at the same time, those who insist that the ordinary people of Russia 
bend their backs even harder,'' Woolsey said. ``We are seen, in short, by 
average Russians as supporting the system and the individuals who are 
exploiting them.'' 


*******


#3
Moscow Times
September 22, 1999 
EDITORIAL: New Bombs Won't End Old Conflict 


Step by step, Russia's reactions to both the recent terrorist attacks and the 
invasion of Dagestan by Chechen fighters is leading Moscow closer and closer 
to what has been unthinkable since May 1997: a renewed invasion of Chechnya. 


Such a move should still be unthinkable. But the growing consensus that 
Chechnya is to blame for the four bombs that have claimed more than 300 lives 
this month means that there is already a popular willingness to answer fire 
with fire. 


The rhetoric is running well in advance of the evidence. No proof whatsoever 
has been supplied to show that anyone in Chechnya - let alone the government 
of President Aslan Maskhadov - was responsible for the bombings. 


Of course, war is only one option being considered by the Kremlin as it 
desperately tries to respond to the bombs and the Dagestan insurgency. 


However, a "sanitary cordon," coupled with air and artillery strikes, sounds 
very much like war through other means. And it could easily turn into 
full-blown war at a future date. 


Meanwhile, the terror attacks and the Dagestan insurgency seem to have 
inflicted large sections of Russia's military and political elite with 
serious cases of amnesia regarding Chechnya. 


"This time we will finish the job properly" is a sentiment that has been 
expressed by generals and columnists alike regarding the problems in the 
Northern Caucasus. 


They forget that Russia found war in Chechnya to be unwinnable last time, and 
that little has changed since then. Indeed, many of the changes are very much 
against Russia, which has a feebler, less popular government now than it had 
at any stage of the Chechen war. 


Also forgotten, by Prime Minister Vladimir Putin among others, is that Russia 
and Chechnya signed a full peace treaty in 1997, not at Khasavyurt - a 
Dagestani town where a truce was agreed to in the fall of 1996 - but in the 
Kremlin. 


On May 12, 1997, President Boris Yeltsin signed accords that committed his 
government to assisting Chechnya to develop its socio-economic sphere - in 
other words, to helping rebuild the region that Russian armed forces had well 
nigh bombed back to the Stone Age. 


Those promises have been broken time and time again, and Chechnya has found 
peace to be little different than war. 


As long as Russia remains unwilling to even talk effectively with Maskhadov 
and his regime on a regular basis, let alone act to assist him in rebuilding 
his shattered land, Chechnya will remain a land where the gun rules supreme. 


********


#4
Moscow seeks aid of erstwhile Cold War foes


MOSCOW, Sept 21 (AFP) - Stunned by a wave of bomb attacks on residential 
blocks, Russia is enlisting the help of its erstwhile rivals in western 
intelligence in the battle against the threat posed by Islamic terrorists.


Russia's intelligence services have engaged in intensive contacts with their 
counterparts in Britain, Israel and the United States in recent days, the 
Sevodnya daily reported Tuesday.


Russia believes international terrorist suspect Osama bin Laden has funded 
militants behind the recent insurgency in Dagestan, which Moscow has linked 
to the wave of bombings that have rocked Russia over the past three weeks.


Close to 300 people have died since September 4 in blasts in Moscow, the 
southern city of Volgodonsk and the Russian Caucasus republic of Dagestan, 
the first time modern Russia has faced a major terrorism threat.


Moscow has blamed supporters of Wahhabism, a radical brand of Islam gaining 
ground in the Russian Caucasus, for the string of attacks, saying militants 
who led recent incursions into Dagestan have masterminded the reign of terror.


Despite blank denials from the main suspects -- Chechen warlord Shamil 
Basayev and his lieutenant Khattab -- the Russian authorities believe 
Chechnya is the wellhead of the terrorist threat currently hanging over the 
country.


Alexander Pikayev, an expert in security issues at Moscow's Carnegie 
Endowment think-tank, said the power vacuum in Chechnya could see the rebel 
Russian republic "play a growing role as a base for radical Islamic terrorism.


"Israel, the United States, and maybe to a lesser extent Britain, all 
represent potential targets for Islamic terrorism. This is why it's a subject 
of mutual concern, and here all parties will have to overcome mutual 
suspicions," Pikayev said.


Russia's FSB domestic intelligence agency has accused Islamic groups in Saudi 
Arabia, Kuwait, Qatar and Syria of funding insurgents who have twice sought 
to proclaim an Islamic state in Dagestan in the past six weeks. Riyadh and 
Doha on Monday denied the claim.


Radical Moslem groups in Pakistan, Turkey and Afghanistan are also believed 
to be helping provide the rebels with millions of dollars, the FSB has said.


Washington and London have good political relations with Turkey and the Gulf 
monarchies and could help Moscow approach capitals with a view to cutting off 
the funding and material support at source, Pikayev said.


Russia is particularly interested in tapping into the vast experience gleaned 
by the Israeli secret service Mossad in dealing with militant Islamic groups 
in the Middle East, he added.


"Mossad particularly has a lot of experience in so-called 'personal 
anti-terrorism', which means identifying and dealing with key terrorist 
leaders," Pikayev noted.


"Mossad was terribly effective in taking revenge on those who carried out 
terrorist attacks," he said. "For instance they reportedly killed those who 
were responsible for the Munich terrorist act against the Israeli team in the 
Olympic Games in 1972."


Russia's intelligence community also hopes to gain access to massive computer 
files on terror suspects held by the Central Intelligence Agency, the Federal 
Bureau of Investigation, Mossad and Britain's MI5 and MI6 secret services.


The British ambassador to Moscow Sir Andrew Wood was called in to see Russian 
Interior Minister Vladimir Rushailo on Monday and presented with Moscow's 
wish list on areas of cooperation.


"They are now being considered back in London to see in what ways we can 
offer assistance," a British official told AFP. "It's not just talk. They 
want specific assistance and we are looking at ways in which we can deliver 
it."


US and Russian counter-terrorism experts, led by top NATO commander Admiral 
Chris Donnelly, are due to meet near Moscow in November to discuss 
intelligence-sharing and cooperation on technology and other know-how.


Washington is particularly keen to work with Russia to track down its public 
enemy number one, bin Laden, who is wanted for his alleged role in the twin 
bombings of US embassies in East Africa which killed more than 220 people. 


*******


#5
St. Petersburg Times
September 21, 1999
Millennium Madness Hits Moscow Early
By Brian Whitmore


RUSSIA'S political class is experiencing the equivalent of the Y2K bug. The 
closer it gets to the end of President Boris Yeltsin's term next summer, the 
more haywire everything goes.


Some have even come to calling the phenomenon "the Yeltsin Bug." Just like 
all those computers that were only programmed to work until 11:59 p.m. on 
Dec. 31,1999, the political system that Yeltsin built appears ready to crash 
now that Yeltsin is about to pass from the scene.


One sign of this is the preponderance of rumors and political conspiracy 
theories. Lately, it has been getting to be a bit much - even for Moscow. 
Last week, the newspaper Izvestia reported that Krasnoyarsk Gov. Alexander 
Lebed may soon be named Russia's prime minister, replacing Vladimir Putin. 
Lebed himself predicted that he would soon be called upon to clean up the 
mess that he says others have made of Russia.


One scenario has Lebed outright replacing Putin. Another has Yeltsin 
resigning early, Putin becoming acting president and Lebed becoming prime 
minister. The clever ex-KGB spy and the popular retired general are a winning 
combination if Kremlin insiders decide to declare a state of emergency, thus 
circumventing those pesky elections that are getting so much harder to fix.


In an unusually quick response, Kremlin spokes man Dmitry Yakushkin called 
the report "absolute rubbish." Yakushkin then went on television Sunday to 
declare that Yeltsin was: 1) not resigning. 2) not planning to fire Putin or 
appoint Lebed. and 3) not planning to declare emergency rule.


The fact that the Kremlin even responded shows that they are nervous about 
something.


The general thrust of these rumors is that Kremlin insider and business 
tycoon Boris Berezovsky is in cahoots with Lebed, counting on the general to 
take over when Yeltsin passes from the scene to protect his safety and his 
business interests. State Duma bad boy Vladimir Zhirinovsky even suggested 
that Berezovsky and Lebed were behind the series of terrorist attacks that 
have plagued Russia and should be arrested.


But hold on to your hats. There is another rumor making the rounds. This one 
via Moskovsky Komsomolets, a newspaper loyal to Moscow mayor Yury Luzhkov and 
ex-prime minister Yev ge ny Primakov - both Kremlin opponents. MK reported 
that Yeltsin is secretly going to have an operation on Tuesday and might not 
survive.


If Yeltsin dies under the knife, MK reporter Alexander Khinshtein speculates, 
the group of Kremlin insiders known as "the family" - led by Berezovsky and 
first daughter Tatyana Dyachenko - "may not even make it on board the 
presidential airplane" to escape the mobs demanding their blood.


Khinshtein writes that Dyachenko is currently trying to broker the family's 
immunity with the presidential front-runner: Primakov gets the Kremlin, "the 
family" gets off.


So what to make of all this spin? It could be just that. The mad ravings of a 
political system about to crash, with its key players spreading rumors to 
serve their own interests. On the other hand, if Yeltsin is indeed on his 
last legs, then it appears that the president's inner circle is divided about 
what to do next. Part of "the family" - the part led by Berezovsky - wants to 
bring in Lebed and crack heads to protect his interests. Another part - led 
by Dyachenko - wants to cut a deal with Primakov.


*******


#6
Russian citizen challenges Luzhkov's right to run


MOSCOW, Sept 21 (Reuters) - Russia's Supreme Court will consider a complaint 
on Wednesday from a voter who wants Moscow Mayor Yuri Luzhkov's political 
alliance barred from December's parliamentary election, a court spokesman 
said on Tuesday. 


In the convoluted world of Russian politics, it was not clear whether the 
latest move was a political spoiler, a pre-emptive strike or a genuine legal 
challenge. 


On August 9, the Justice Ministry ruled Luzhkov's Fatherland party could 
stand despite complaints about its last-minute registration last December 19, 
a year before polling day. 


But since the ministry decision, Fatherland has formed an alliance with the 
regions-based All Russia movement. That prompted voter Vladimir Lunin to 
lodge a complaint with the Supreme Court that complicates an already 
confusing tale. 


Despite the Justice Ministry ruling, Lunin contends Fatherland registered 
late and so the Fatherland-All Russia movement should not be allowed to run. 
Lunin's complaint is addressed to the Central Election Commission rather than 
the ministry. 


The hearing is at 10:30 a.m. (0630 GMT) on Wednesday, the court spokesman 
said by telephone. 


The court has several options, according to legal experts. 


Among these options, the court can simply reject the complaint for being 
directed at the wrong official body -- it is the ministry that registers 
parties for elections, not the Central Election Commission. 


The ministry can, in theory, accept the complaint. But even then it can 
simply allow Fatherland members to gather signatures again to register as 
members of the alliance. In that case, even the name of the alliance does not 
need to be changed. 


Lunin's political affiliation and motives were not clear. 


Luzhkov's alliance, one of 139 political organisations registered for the 
election, is expected to do well in the vote. 


*******


#7
Yeltsin's Abilities Questioned
September 21, 1999
By GREG MYRE


MOSCOW (AP) - President Boris Yeltsin cannot perform his duties because of 
health problems and should consider stepping down before his term expires 
next year, Moscow's mayor said today.


Mayor Yuri Luzhkov used to be allied with Yeltsin, but the two have become 
openly antagonistic over the past year. Luzhkov spoke in Vienna, Austria, 
where he was meeting with businessmen and politicians, and his remarks were 
reported by the Interfax news agency.


Yeltsin ``cannot effectively fulfill his duties, primarily due to the state 
of his health,'' Luzhkov was quoted as saying.


The Russian media have speculated that Yeltsin may resign, but the president 
has insisted that he will serve until his term ends next summer.


Luzhkov said he had no presidential ambitions and would try to convince his 
ally, former Prime Minister Yevgeny Primakov, to run for the job. Luzhkov and 
Primakov recently formed a political alliance, and both are considered strong 
potential candidates in Russia's presidential election. However, neither has 
declared his candidacy.


Many political analysts believe that one - but not both - will enter the race.


``I am very close to (Primakov) and am sure that I will be able to persuade 
him,'' Luzhkov said.


Luzhkov said he was happy serving as Moscow's mayor. He remains extremely 
popular in the Russian capital and is expected to easily win re-election in 
December.


``I like my job and my greatest ambition is to win the people's respect, 
which is possible in any post,'' Luzhkov was quoted as saying.


However, Luzhkov added that he might join the presidential race if he sees no 
worthy candidate.


Yeltsin is barred from running for a third term. Other leading presidential 
candidates include Communist Party leader Gennady Zyuganov, Siberian governor 
Alexander Lebed and liberal politician Grigory Yavlinsky.


*******


#8
Date: Tue, 21 Sep 1999 
From: "Peter Reddaway" <preddaway@compuserve.com>
Subject: The Current Debate on US Strategy Towards Russia


SOME BRIEF THOUGHTS


At last the debate on US/G-7/IMF strategy towards Russia that a few
people including myself have been advocating for as much as seven years, is
underway. However, many of the debate's participants, especially the
architects and supporters of the strategy (which was adopted in 1991 by a
Republican administration), are still not brave enough, or well informed
enough, to approach it from a painful, but essential angle. They do not
start from - or even discuss at all - questions that would seem to be
fundamental if one is trying to assess the successes and failures of
Western policies towards Russia, and how these should best be revised for
the future.


Two such questions are : Why were most Russians enthusiastically
pro-American in 1991, yet today they are indifferent, unfriendly,
resentful, or outright hostile to the U.S. ? And why are the Russian
politicians with whom we have long been most intimately and publicly
connected now the most deeply distrusted people in Russia ? 


To put the second question in statistical terms, why - according to
a poll taken on September 11-12 by the respected Public Opinion Foundation,
which sometimes does polls for the Yeltsin administration - is Boris
Nemtsov trusted by only 8% of Russians and distrusted by 66% ? Why is Yegor
Gaidar trusted by 2% of Russians and distrusted by 81% ? Why is Anatoly
Chubais trusted by 3% and distrusted by 85% ? Why is Boris Yeltsin trusted
by 2% and distrusted by 90% ? And why do current polls predict that the
electoral bloc headed by Chubais, Gaidar, and Nemtsov - politicians who
come closer than any others to reflecting American values - will get a
minuscule 2% of the vote in December's parliamentary elections ?


These findings are far from being novel. Why, then, in their
recent comments and articles, do Strobe Talbott, Lawrence Summers, Al Gore,
Madeleine Albright, Robert Rubin, Bill Clinton, Michel Camdessus, James
Wolfensohn, Fred Hiatt, David Hoffman, Leon Aron, and others, avoid these
most fundamental, "starting-point" questions ? Why do they instead, with a
virtuous air, knock down straw men who allegedly want to isolate Russia by
disengaging from it, and whom they do not or cannot name? Do they think
that problems can be solved without addressing the most salient evidence ?
Don't they see that their reputations would benefit, if they were brave
enough to fully and seriously - not obliquely and furtively - confront past
mistakes and doubtful judgments ? Is there a lack of intellectual honesty ?
Or are they, perhaps, just badly informed ?


The last possibility seems somewhat less implausible, especially
regarding those who work in government, when one reads (in JRL 3512) the US
Information Agency's "Foreign Media Reaction" of September 20. The lengthy
section on Russia provides helpful summaries of 25 articles on burning
issues of the day in last week's Russian press. However, the section gives
the U.S. government and other readers a terribly skewed picture of Russian
opinion. Every single one of the publications cited is oriented to Moscow's
political and business Establishment. I would expect, therefore, that the
total number of readers of the publications cited represents a mere 1-2% of
the adult Russian population. (Maybe a JRL reader could collect the data
and produce a more exact figure ?) 


In other words, the views of 1. the nationalist press, 2. the
communist press, and 3. the regional press - which, taken together, might
be read by about ten percent of the population - are simply ignored by
USIA. Now many of these views would no doubt be unpalatable to us, some of
them highly unpalatable. But are we supposed to be ostriches ? Or children
who have to be spared distressing news ? It would be nice if USIA, whose
foreign poll-taking department has produced consistently distinguished
work, would compile samplings of the Russian press that are both
representative and of equal quality ? This would, in a small way, assist
the current critically needed debate on US strategy.


Peter Reddaway, Professor of Political Science, Institute for
European, Russian, and Eurasian Studies, George Washington University


*******


#9
Date: Tue, 21 Sep 1999
From: Adrian Helleman <awhelleman@glasnet.ru>
Subject: More on governance in Russia


I appreciate very much what Oleg Petrov wrote regarding "Reinventing
Governance in Russia" in JRL 3511. He is right on when he writes that
"public and corporate corruption in Russia is so pervasive and governance
is so bad that it needs to be addressed before anything else can work
there," and that this is now "the principal stumbling block in transition
to a market democracy." Indeed, to use his image, the bucket has to be
fixed first before the thirsty Russian people can enjoy a drink of water.


He is also right that Russian corruption and governance problems have deep,
historic, cultural roots, and can only be solved through a systemic,
comprehensive and long-term program of governance reform. The culture and
ethics of governance, I agree, need to be changed.


In my classes at MGU I have emphasized for several years already the
importance of civil society, which, as Petrov notes, can be a powerful
agent of change in Russia. Democracy will never take root in Russia, in my
opinion, unless a strong and healthy civil society begins to function.
Civil society provides the structural framework which enables citizens to
exercise their democratic freedoms; without it, they are unprotected and
their efforts will fail.


Petrov's clarion call "to get all the stakeholders around the table and
start a massive effort at reinventing public and corporate governance in
Russia" is therefore appropriate. There indeed needs to be, what he calls,
a "Movement for Reinventing the Russian State" that can demand systemic
changes in governance. He concludes by writing, "Together we can do it!"
That is the essence, of course, of civil society. None of us can
accomplish such changes by ourselves.


What is often overlooked in discussions about civil society is how, at
least in the Western world, it is rooted in a Judeo-Christian, or as I
prefer, a biblical world view. The roots of civil society can be found
there. That does not mean that civil society cannot be transplanted into
other cultural settings, i.e., Japan, but this is where it developed. This
world view has also shaped Russia, and it must do so again. Seventy years
or so of soviet domination could not eliminate it, but that long period of
exile has left very deep scars on Russia, however.


In addition to creating the necessary associations for a functioning civil
society, Russians must go back and rediscover their roots. Only when the
ethics rooted in this world view again become explicit and are lived out in
the lives of the Russian people today will truly significant changes be
possible. The amorality of so many people in Russia is understandable,
even though that does not excuse their behavior. Amorality can be found
everywhere in the world. It occurs especially when people have lost their
spiritual roots. 


In contrast, when government leaders in the US, for example, disregard for
pragmatic reasons what they learned while in Sunday school, their behavior
is not really amoral but immoral. They know better. There is no excuse
whatsover for their behavior.


In Russia today, sad to say, many people do not know better. If they do,
then they are even more culpable than their fellow citizens who do not know
it at all. What is needed so urgently in contemporary Russia is a
spirtually-rooted ethics. The basis for this is still present; it needs to
be recovered before it is too late. Thus the development of a civil
society in Russia is not only crucial but also urgent. In another
generation it may be even more difficult, if not impossible.


Adrian A. Helleman, Ph.D.
Moscow State University
Faculty of Philosophy


*******


#10
Russia: Kremlin Maneuvers For Loyalty Of Large Companies Before Election
By Sophie Lambroschini


The head of the Russian oil pipeline monopoly was sacked last week under 
questionable circumstances. RFE/RL's Moscow correspondent, Sophie 
Lambroschini, says the sacking is the latest in a series of shake-ups at 
leading companies, as rival groups vie for power and influence ahead of this 
year's parliamentary elections. 


Moscow, 21 September 1999 (RFE/RL) -- The head of Transneft, Russia's oil 
pipeline monopoly, has been dismissed in an ongoing fight for control of the 
company. The dismissal of Dmitry Savelev featured the usual allegations of 
Kremlin intimidation and a host of legal violations. It also featured a raid 
by elite Interior Ministry troops.


It's not yet clear what's behind the move, but Savelev told Russian 
television last night that the Kremlin was calling the shots. He and others 
say the dismissal fits a recent pattern by the Kremlin to gain control of 
important companies ahead of parliamentary elections in December and the 
presidential vote next year.


News of the dismissal came last week after a hastily arranged shareholders 
meeting on Monday. The meeting was reportedly ordered by First Deputy Prime 
Minister Nikolai Aksenenko and Oil Minister Viktor Kalyuzhny, who were 
seeking to fire Savelev for allegedly mismanaging the company and failing to 
pay dividends to the state. 


Savelev is associated with former prime minister Sergei Kiriyenko, a Kremlin 
rival running for a parliament seat. Savelev headed a local oil company 
formerly directed by Kiriyenko, and it was during Kiriyenko's brief tenure as 
prime minister in 1998 that Savelev became president of Transneft.


Following the dismissal, Savelev was replaced by Semyon Vainshtok, vice 
president of Russia's largest oil company, Lukoil. Savelev, however, refused 
to comply with the move, saying it violated the law on joint-stock companies.


When Savelev refused to leave the company, Interior Ministry troops were 
called in to forcibly evict him. Bursting their way into the Transneft office 
on Thursday, the troops carved a way for the new director by sawing through 
chains placed on the doors.


Speaking to Russian NTV television last night, Sakelev said the mastermind 
behind his ouster was alleged Kremlin insider Roman Abramovich. Savelev said 
Abramovich tried to pressure him into "obedience" by threatening him with 
trumped-up criminal charges.


Abramovich, the head of the Sibneft oil company, is often associated with 
Boris Berezovsky, another businessman said to be close to President Boris 
Yeltsin. For months, Russian media have portrayed both Berezovsky and 
Abramovich as Rasputin-like figures playing behind-the-scenes politics.


Nikolai Petrov, an analyst with the Carnegie Fund, says he thinks the Kremlin 
was indeed behind the dismissal. He says that with elections just a few 
months away, the Kremlin cannot accept the idea of not controlling a maximum 
of resources.


Petrov says the dismissal is similar to recent attempts by the Kremlin to 
influence events at other important companies, most notably the 
weapons-producing company Rosvooruzhenie and the gas giant Gazprom. 


RFE/RL's economic analyst, Elamr Murtazaev agrees. He says that before the 
elections, the Kremlin is trying to secure the loyalty of big companies to 
try to tap into the country's vast resource wealth.


Since the privatization of natural resources began seven years ago, the fight 
for control of companies in these sectors has been constant. As a key company 
and still partly state-owned, Transneft was a logical target. Russians are 
now asking which company will be next. 


*******


#11
U.S. business rep says Russia good place to invest


MOSCOW, Sept 21 (Reuters) - A senior U.S. business representative on Tuesday 
gave Russia an unusual boost, calling the investment climate positive and 
saying the government was ready to tackle corruption. 


"I give it a positive place to invest, growing more positive over time," 
Thomas Donohue, president of the U.S. Chamber of Commerce business 
association, told a news conference during a visit to Russia. 


Russia's image has been damaged by security fears after a recent series of 
bomb attacks that killed almost 300 people, and amid an investigation into 
allegations of ther laundering of money, possibly including aid from the 
International Monetary Fund, through the Bank of New York <<A 
HREF="aol://4785:BK">BK.N</A>>. 


U.S. Treasury Secretary Lawrence Summers on Tuesday told the House of 
Representatives in prepared remarks that it was difficult to overestimate 
problems facing Russia and that future support depended on adequate 
safeguards. 


Donohue, who met with senior governors, businessmen and officials, said 
fighting corruption was key for Russia but played down money-laundering 
investigations, noting that capital flight could be a key factor in money 
leaving the country. 


He did not believe government corruption was widespread. 


"I think there is as much smoke about this as fire," he said, referring to 
corruption scandals. 


"I'm impressed with what the Russian government is doing to deal with the 
terrorism...and I have been encouraged in all of my meetings that the 
government is taking (corruption) in a very serious manner." 


Donohue said foreign businessmen wanted Russia to improve transparency and 
reliability of information by establishing better accounting standards, 
ensuring profits could easily be repatriated and securing intellectual 
property rights. 


Russia's educated work force, abundant natural resources and large consumer 
market made for a positive investment climate, and economic progress was 
being made. 


Businesses taking a calculated risk might invest before the presidential 
election next year, he added. 


He said that there was a lot of Russian enthusiasm for more investment but 
added: "There is limited enthusiasm for having to open up all of the markets 
and all of the information and all of the activities of domestic companies so 
everybody plays on the same field." 


*******


#12
Subject: Book Review: Timothy Harper, Moscow Madness
From: Ray C Finch IV <finchr4@juno.com>
Date: Tue, 21 Sep 1999


By Ray Finch 


Book Review: Timothy Harper, Moscow Madness, New York
,McGraw-Hill,
1999. Pp. 250, index. $25. ISBN 0-07-026700-6


The righteous indignation of western politicians and commentators
concerning the latest charges of Kremlin corruption are disconcerting. 
These "revelations" have been common knowledge to every babushka and to
any moderately-informed observer of Russia. With elections looming on
the not-too distant horizon, one suspects that the uncovery of this
scandal has less to do with finding the truth than in gaining political
capital. 


For those who are genuinely interested in understanding what went
wrong with America's approach toward Russia during the past ten years
should read Moscow Madness, by Timothy Harper (McGraw-Hill, 1999). It is
an inadvertent confession from a front-line soldier who loses a
considerable amount of money while fighting in the trenches of
post-Soviet business in Moscow. While lacking in macro-economic
analysis, the book, albeit unwittingly, provides a thumbnail sketch as to
what went wrong with the American economic approach to Russia and where
blame should be applied. 


The author attempts to exonerate the main American businessman and
protagonist (Rick) of this tale and lay the blame for his business
failures upon a number of factors unique to the Russian market (i.e.
poorly developed commercial laws, corrupt officials, an inbred criminal
mentality among Russians etc...). These Russian factors certainly
complicated matters, but the chief faults were American as an apple pie
made from Ritz crackers. Indeed, at times I couldn't tell who was the
bigger huckster, Rick or the Russian he was working with. 


Rick has a number of schemes for getting rich while working in
Russia. Recall the euphoria of the early-1990's, when Russia was touted
as the biggest of all emerging-market klondikes. Though Rick has little
understanding of Russian culture, language or history, and his experience
in dealing with the Russians had been minimal (he once sold sails to the
Soviet Olympic sailing team), he senses a golden opportunity. In 1991,
in collusion with a Russian sailing acquaintance, he launched the Odessa
200 project. Scam might be a more appropriate word. This was going to
be a joint effort to help the Russians build a boat and compete in a
premier sailing contest. Though the Russian ship was nowhere near
completion, Rick put together a slick brochure which promised investors
all sorts of recognition, advertisement and benefits (to include an
invitation to sail on the yacht) for a $5000 donation. The project was
scrapped a couple of years later, and though Rick and his partners
collected some $150,000, there is no indication that he ever returned a
penny. Hey, blame it on those lazy and devious Russkies. 


Rick's next brainstorm occurred during one of his trips to Russia
to check on the construction of the Odessa ship. Watching a fellow
Aeroflot plane passenger lovingly open a can of American beer upon safely
landing, Rick figured that he could make millions selling American beer
to the Russians. Again, it didn't matter that Rick had little or no
understanding of Russian culture, language, or even drinking preferences.
That one passenger had convinced him that Russians would be thrilled at
the prospect of forking over their hard-earned rubles for a pissy
American brew. 


Rick draws up a slick proposal (including what the author claims
is the first-ever marketing study on Russian drinking preferences in
Moscow) and convinces some equally ignorant investors to fork over a
couple hundred thousand to bankroll this venture. He sells his proposal
to an American beer maker, who is reluctant however, to extend him a line
of credit. The most enjoyable part of the book are the descriptions of
the hurdles which Rick must cross to get his beer to the customer. 
Matters aren't helped by Rick's distant management style (living in the
U.S.) and his exorbitant business expenses. I don't think that it would
be spoiling the plot to divulge that this venture too goes bust, but not
before Rick and company incur some million dollar losses. 


Rick's last foray into the jungles of Russian business is as
specious and flippant as the first. Having failed to sell the natives
more alcohol, he's going to try the opposite tack. Rick has learned that
many Russians love their vodka and deduces that hangovers must be fairly
common. Why not try to sell them an American elixir which promises to
relieve the effects of pochmel'ye. He puts together a plan to sell
millions of packets of a discontinued American product (Dr. Seltzer's
Hangover Helper) when, in the summer of 1998, the bottom fell out of the
Russian and Belorussian economies. 


While Rick has all sorts of excuses as to why his sure-fire
schemes failed (some of which are valid), he just can't understand why
these uncivilized Russians wouldn't want to pay three times as much for a
can of watery American beer. Despite his repeated trips to Moscow, Rick
has failed to understand his prospective Russian
customer. During my time in Moscow, I met quite a few American
businessmen who fit the Rick mold. Though they bragged of having lived
in Russia for a certain length of
time, it was as though they never left their American bubble. They
treated their Russian counterparts as ignorant, unsophisticated and
largely untrustworthy. They lived in Western accommodations, ate mostly
Western food, rarely tried to speak the language and never for an instant
stopped believing that American culture was infinitely superior to
anything Russian. 


Rick is the perfect symbol for the American economic policy
toward Russia
during the past decade. We became involved, not so much to help the
Russians, as to generate profits. Our charity extended only up to the
bottom line. Even the much touted programs to reduce Russia's nuclear
potential have been largely driven by the
understanding that a nuclear disaster might have a negative effect upon
the "American
way of life." The business of America is business (read profits) and as
the lowliest
bureaucrat within the State Department Inc. has already discovered, all
the blather about democracy and human rights are just means to this end. 
There is no other way to explain the blindness as to what has been
occurring in Russia for the past ten years. Our desire for huge profits
has blinded us to the worsening corruption and social problems. 


The essence of what was wrong with America's economic policy
toward Russia is richly illustrated in the last chapter of the book. The
author tells us that despite all of Rick's efforts, he's never made more
than [just] $100,000 a year. Even so, Rick is not disgruntled. Like a
lot of other Westerners, both private and governmental, he had a good
time living it up in Moscow, spending other people's money. While wining
and dining some of his friends in his Florida home, Rick is already
considering his next Russian project (perhaps a mobile blood bank or
chemically heated dehydrated meals). Should American economic policy
proceed along the current track, there may soon be a need for both food
and blood in Russia.


******


#13
Date: Tue, 21 Sep 1999 
From: Dominique Arel <Dominique_Arel@brown.edu>
Subject: ASN ANNOUNCEMENT FOR JRL


Call for Papers


"Identity and the State:
Nationalism and Sovereignty
in a Changing World"


ASN 5th Annual World Convention
International Affairs Building,
Columbia University, NY
Sponsored by the Harriman Institute
13-15 April 2000


The Annual World Convention of the Association for the Study of
Nationalities (ASN) has become the most attended international scholarly
gathering dealing with issues of national identity, nationalism, ethnic
conflict and state-building in Central and Eastern Europe, the former
Soviet Union, Central Asia, and adjacent areas. The Convention grew in 1999
to a record 500+ attendees and 90 panels. More than 120 panel participants
travelled from overseas for the event, particularly, but not exclusively,
from Western and Eastern Europe. Panelists' disciplines included political
science, history, anthropology, sociology, geography, and sociolinguistics.


The central theme of the 2000 Convention will revolve around the questions
of nationalism, sovereignty and self-determination. Proposals can focus on
particular cases, theoretical questions, or cross-regional comparison (with
some of the papers grounded in cases outside of our core area). Due to
recent events, papers dealing with the Balkans and the Caucasus are
encouraged. Unlike most conventions, ASN accepts individual paper
proposals, although full panel proposals have a greater chance of being
accepted because of space constraints.


The ASN World Convention's yearly theme specifically refers to a core
number of panels. As in previous years, the Convention invites proposals on
a wide range of topics related to identity, nationalism, conflict and
state-building in Central and Eastern Europe, the former Soviet Union,
Central Asia, and adjacent areas.


At the 1999 Convention, 15 panels were entirely devoted to the Russian
Federation. The themes included Dimensions of Russian Foreign Policy,
Ethnic Republics of the Russian Federation, Russian Regional Performance in
the Context of Global Instability, Development of Russian Regions: Economic
and Security Aspects, Peoples of the North/Far East, Ethnicity, Economy,
and State in Tatarstan, Reconfiguring Russian Identity, Russian Nationalism
and Geopolitics, Post-Soviet Identities in a Big (Russian) City, Russia vs.
Chechnya: Two Recent Books on Chechnya, and History, Democracy and
Stability in Dagestan. The ASN web site (http://picce.uno.edu/asn) contains
a complete list of the 1999 panels.


Videos/Films. The 1999 Convention was enhanced by the highly successful
screening of short videos (10-15 minutes), accompanying presentations in
regular panels, as well as medium- and full-length videos or films, as
special screenings followed by discussion. For 2000, proposals partly or
entirely revolving around video, film, or audio-visual material are
strongly encouraged. As in last year, one of the convention rooms will be
exclusively devoted to the screening of video material while, depending on
submissions, a film screening room may also be used. All suggestions should
be sent to the Program Chair, Dominique Arel (address below).


Location. As in previous years the Convention will be hosted by the
Harriman Institute at Columbia University, New York (address below), and
co-sponsored by the Watson Institute, Brown University, Rhode Island.


Schedule. The convention will begin on Thursday, April 13th, at 1 PM, and
ends Saturday, April 15th in early evening. No panels will be held on
Sunday, and the dates do not coincide with the Jewish and Orthodox
religious holidays, which all take place later in the month.


Panel/Roundtable/Roundtable Proposals. There is no particular application
form to fill out. The vast majority of proposals were e-mailed to the
Program Chair last year, but proposals sent by fax or regular mail are also
accepted. For instructions on the proposals, see the "Application
Information" below. All proposals must be sent to the Program Chair,
Dominique Arel (address below).


Registration. Registration fees are $30 for ASN Members, $50 for
Non-Members ($25 for East European Non-Members) and $15 for Students. All
panel participants have to register by March 17th, 2000. Pre-registration
by panel participants and attendees can be done electronically, by fax, or
by regular mail. For information, please contact Gordon Bardos (address
below).


Funding. Participants are responsible for seeking their own funds to cover
all travel and accommodation costs. ASN is unable to assist participants
financially, including applicants from Central and Eastern Europe, the
former Soviet Union, and Central Asia.


Accommodation. ASN has a list of several recommended hotels, in various
price ranges. For further information, please contact the Convention
Director Gordon Bardos (address below).


Advertisements/Exhibitors. Several dozen publishers and companies had
exhibits and/or advertised in the convention program in 1999. Due to
considerations of space, advertisers and exhibitors are encouraged to place
their order early. For information, please contact the Convention Director
Gordon Bardos (address below).


Convention Papers. The convention papers will be available for sale at the
Convention for $1 apiece.


Web Site. Our web site provides continuously updated information on the ASN
World Convention: <http://picce.uno.edu/asn>.


Membership Subscription to ASN. A yearly membership to ASN is $55, and $25
for students. Members receive the journal Nationalities Papers (four times
a year), the periodicalAnalysis of Current Events (ACE, six times a year),
the newsletterASNews (twice a year) and a registration discount at the ASN
Annual World Convention. Beginning in 1999, ASN Members will also have the
option of subscribing to Europe-Asia Studies at the cut-rate of $52 yearly.
Membership forms are available at the ASN head office, c/o Gordon Bardos
(see address below), or can be downloaded from our ASN web page.


We look forward to seeing you at the convention!


Dominique Arel, Program Chair
Gordon Bardos, Convention Director


Application Information


ASN is accepting proposals for panels, roundtables, or individual papers.
There is no particular form to fill out. Proposals can be emailed
(preferably), faxed or mailed to the Program Chair (address below).


Proposals for panels with presentations based on papers must include:
*a chair, no more than three paper-givers and a discussant
*the title of the panel and of the three papers
*the affiliation, postal address, telephone, fax, and email (very
important) of all participants
*a one-paragraph cv of each participant


Proposals for roundtables must include:
*a chair and no more than four presentors
*the title of the roundtable
*the affiliation, postal address, telephone, fax, and email (very
important) of all participants
*a one-paragraph cv of each participant


Proposals for individual papers must include:
*the title and a one- or two-paragraph abstract of the paper
*the affiliation, postal address, telephone, fax, and email (very
important) of the applicant
*a one-paragraph cv of each participant


If audio-visual equipment is required, please indicate so in your application.


As before, applicants must abide by three golden rules:
*No participant may be listed more than once on a given panel
*No participant may present more than one paper at the convention
*No participant may appear more than twice in the convention program


The proposals must be sent to Dominique Arel (address below). Email
applications are encouraged.


Deadline for proposals: 9 December 1999


For information on panel and paper proposals:
Dominique Arel
ASN Convention Program Chair
Watson Institute
Brown University, Box 1831
130 Hope St.
Providence, RI 02912
401 863 9296 tel
401 863 2192 fax
darel@brown.edu


For information on exhibits
and advertisements in the convention program:
Gordon Bardos
Convention Director
Harriman Institute
Columbia University
1216 IAB
420 W. 118th St.
New York, NY 10027
212.854.8487 tel
212.666.3481 fax
gnb12@columbia.edu


*******