August 9, 2001

This Date's Issues:  5385

Johnson's Russia List
#5385
9 August 2001
davidjohnson@erols.com

[Note from David Johnson:
1. Novye Izvestia: Sergei Agafonov, NIKITA MIKHALKOV FOR THE CLEMENCY COMMISSION? The regime needs a tame, meek intelligentsia to do its dirty work.
2. Itar-Tass: Deaths outstrip births in Russia.
3. Luba Schwartzman: ORT Review.
4. Reuters: Russian economy seen more robust, not out of woods.
5. Delovye Lyudi: Irina Skibinskaya, THE END OF THE POST-CRISIS ECONOMY. It is clear now that the Russian economy missed its chance.
6. Novye Izvestia: Alexander Nadzharov, BACKING UP? President Putin prepares a turnaround of the Russian economy. The Security Council's plans for national economic security.
7. Wall Street Journal: Paul O'Neill, How Russia Can Fulfill Its Potential.
8. pravda.ru: FURTHER ESTABLISHING A FACT: FOR THE RECENT 10 YEARS INVESTMENTS IN RUSSIAN SCIENCE REDUCED MORE THAN 5 TIMES.
9. Reuters: Russian naval reforms seen slow and expensive.
10. washingtonpost.com: Robert Kaiser, On the Road in Russia's Land of Abundance. Feast on the River. A Worried Forester Hosts a Bucolic Banquet.
11. Los Angeles Times: Robyn Dixon, New Woes for Ukraine Opposition.
12. BBC Monitoring: Anti-terrorism the new Russian ideology, Chechen deputy premier.
13. AP: Centenarian Recalls Fighting Russians.]

*******

#1
Novye Izvestia
August 9, 2001
NIKITA MIKHALKOV FOR THE CLEMENCY COMMISSION?
The regime needs a tame, meek intelligentsia to do its dirty work
Author: Sergei Agafonov
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
AS CHAIRED BY WRITER ANATOLY PRISTAVKIN, THE PRESIDENTIAL CLEMENCY COMMISSION HAS APPARENTLY BEEN FAR TOO LIBERAL. THIS SITUATION IS ABOUT TO BE CORRECTED. THE PRESIDENT WILL SOON APPOINT A NEW CHAIRMAN, AND THE MOST LIKELY CANDIDATE IS THE WELL-KNOWN FILM DIRECTOR NIKITA MIKHALKOV.

A new draft presidential decree is being prepared. It concerns
the appointment of a new chairman for the presidential clemency
commission. Vladimir Putin has not signed it yet, but those in the
know say it is sure to be signed within the next 48 hours. As chaired
by writer Anatoly Pristavkin, the clemency commission has apparently
been far too liberal. This situation is about to be corrected.

Changes in the clemency commission, which is said to be too soft
in approving appeals for pardons, come as no surprise. After all,
Putin is known for his determination to root out everything he
considers indications of administrative "weakness". The draft decree
prepared by the presidential administration suggests appointing Nikita
Mikhalkov as chairman of the clemency commission.

A movie tycoon and Academy Award winner, Mikhalkov comes from the
wealthy family of a prominent Soviet writer. Someone so multi-skilled
is just the man for the job.

No one knows when the issue of Mikhalkov's appointment was
settled - when he was discussing the revival of Stalin-era music for
the national anthem with Putin, or during the president's visit to
Mikhalkov's country estate, at the same time as Jack Nicholson, only
recently. It doesn't actually matter. What matters is that the regime
once again needs a tame, meek intelligentsia to do its dirty work.

After eighteen months of administrative manipulations, the state
structure of the Russian Federation seems to be taking shape at long
last. A tough executive hierarchy, broad functions and powers for the
security and punitive ministries - and, as the final touch, purges in
the presidential clemency commission. "Moscow Doesn't Believe In Tears
- it was more than just a movie. Are we that forgetful?

*******

#2
Deaths outstrip births in Russia
ITAR-TASS

Moscow, 7 August: High death rates are one of the most pressing problems
Russia faces now. The number of deaths among the population has risen to 15
per every 1,000 people, which is 10 per cent more than in 1998, says a health
statistics report released by Academician Oleg Shenin at a meeting of the
board of the Russian Health Ministry on Tuesday [7 August].

Particularly high death rates have been registered among the
economically-active population, Shenin said. The majority of deaths are
caused by coronary and lung-related diseases, injuries, poisoning, including
alcohol intoxication, traffic accidents and murders.

Birth rates remain low. In twenty-seven regions of Russia death rates exceed
birth rates by two-three times, although a slight increase in birth rates
from 8.3 to 8.7 per every 100,000 people was reported in 2000 against the
1999 birth statistics.

According to forecasts made by the State Statistics Committee, by the year
2016 the population in Russia will drop by 10.4m people against the beginning
of 2001, [and is] expected to total 134.4m.

*******

#3
ORT Review
www.ortv.ru
Compiled by Luba Schwartzman (luba7@bu.edu)
Research intern at the Center for Defense Information
Research fellow at the Institute for the Study of Conflict, Ideology and Policy
at Boston University

HEADLINES,
Wednesday, August 8, 2001

- North Korean leader Kim Jong Il's visit to Russia is over. His armored
train headed east from Moscow's Yaroslav station earlier today.

- The recently-elected "Nizhegorod oblast' governor declared that he is
ready to act "in one key" with the federal center, and "to follow the
example of President Vladimir Putin."

- New information concerning opposition leader and former Ukrainian deputy
prime minister, Yulia Timoshenko, has prompted the Russian General
Prosecutor's office to forward two cases against her (bribery and
smuggling money into Russia) to the Ukrainian General Prosecutor's office.

- The port in St. Petersburg has been paralyzed by a strike of the port's
pilots, who are protesting the government's attempt to nationalize their
services. Four rounds of talks between the authorities and the pilots'
association have yielded no results. Pilots at other ports have also gone
on strike. Government representatives are accusing them of conducting a
"political" rather than "economic" action.

- Russian Interior Minister Boris Gryzlov signed an order today
criticizing and disbanding RUBOP (the Regional Anti-Organized Crime
Division) structures in all federal regions and creating
operative-investigative bureaus that will take over their functions. He
also highlighted the threat of the Tambov criminal group, which runs up to
100 industrial enterprises in St. Petersburg, making it the "crime
capital" of the country.

- The administrators of the Kursk rescue operation held a press conference
in London today. Journalists were most interested in the fate the first
section of the nuclear submarine - the answer is that the section is going
to remain on the seabed, but will be under observation for the next year.

- The one-year anniversary of the explosion in the Pushkin Square Metro
was commemorated today in Moscow. The investigation is still going on and
neither the organizers nor the executors of the terrorist act that cost 13
lives have been found.

- The South-Sea typhoon that hit Vladivostok destroyed 30 kilometers of
roads and 7 bridges, flooded more that 1,000 houses and left more than 310
without electricity. Damage is estimated at 1.275 billion rubles. Nine
people were killed and 12 are missing.

- Russian President Vladimir Putin held one-on-one meetings with Minister
of Natural Resources Vitaly Artiukhov and Energy Minister Igor Yusufov.
For both of these recent appointees this was the first chance to report to
the president.

- At a meeting devoted to the discussion of restoration work in Yakutia,
Russian Emergencies Minister Sergei Shoigu demanded quicker deliveries of
construction materials and declared that if the work is not complete by
September 15 those held responsible - including himself - will have to
retire.

- A unique exhibition of peasant art has opened at the Moscow Arts Center.

- The cholera virus is still spreading in Tatarstan - diagnoses have been
made in two other regions - Al'keevskii and Vysokogorskii. A total of 70
people are diagnosed with the virus and 300 people are under observation
in the republic.

- An archive in Omsk might be the last hope of former prisoners of the
Nazi regime who would like to be eligible for compensation.

*******

#4
Russian economy seen more robust, not out of woods
By Patrick Lannin

MOSCOW, Aug 9 (Reuters) - Russia is set to cope with problems such as an
expected fall in oil prices and persistent inflation, but faces further
difficult long-term economic reforms to ensure sustainable growth, analysts
said.

They said the economy was still too dependent on exports of oil, gas and
metals and needed measures to diversify and increase investment in other
sectors. Banking and finance needed particular attention, they added.

Russian GDP rose 5.4 percent in the first half of this year, and in
January-June its primary budget surplus, which excludes debt servicing, was
4.8 percent of GDP. But the government has had to raise its inflation
forecast for the whole year to 17-18 percent.

"The results of the first half of the year are much better than expected and
this is much to the credit of the government," said Yuliya Savelieva,
economist at ING Barings in Moscow.

"But at same time, the government cannot relax in the medium term as there
are problems that need to be decided and which need a serious approach."

The government, spurred on by President Vladimir Putin, has tackled a number
of key areas such as cutting taxes and dealing with land reform. It also
launched an overhaul of the judicial and legal system aimed at increasing
transparency and fairness.

The aim of the changes is to increase investment and encourage broad growth
across the economy.

Roland Nash, analyst at Renaissance Capital, said other steps were vital,
such as a restructure of natural monopolies Unified Energy System (UES)
<EESR.RTS> and Gazprom <GAZP.MO> <GAZPq.L> and state-owned bank Sberbank
<SBER.RTS>.

But all three are tricky as UES and Gazprom effectively subsidise the economy
with low tariffs, which will have to rise if investors are to be attracted to
a restructuring.

Sberbank also needs a revamp as its dominance of the bank sector is driving
out possible competition and distorting the market. But its very size makes
any restructure problematic.

"You have to do these reforms while the economic environment and the fiscal
environment are benign," Nash said.

The government has so far done little to tackle banking reform, although it
has said it wants to raise transparency and for banks to conform to
international accounting standards.

OIL PRICE FALL ON HORIZON

Although the country is not headed for a crisis, the short-term macroeconomic
picture is not without clouds.

These include the prospect of a fall in prices for oil, exports of which have
been the main driver in Russia's economic growth this year and last, and
boost the primary budget surplus.

However, analysts said the benefits already felt from earlier reforms,
including a better fiscal policy, as well as the war-chest built up from high
oil and gas prices so far, should see Russia through the downturn in
hydrocarbon revenues.

"A low energy prices scenario shows that the external surpluses accumulated
during the period 1999-2001 would take several years to wear off," said
Lehman Brothers economist Augusto Lopez-Claro in a note on Russia.

"By 2006, the current account would still be in surplus," he added. Lehman
saw oil prices as low as $15 a barrel by 2006, although Savelyeva said the
average price for Russian Urals Blend over the last 10 years was more like
$17.

This compares with a price for Urals in the first half of 2001 of $24.6 a
barrel, a level which helped GDP growth.

INFLATION, ROUBLE APPRECIATION ALSO PROBLEMS

Another problem is inflation, which Russia is finding difficult to push down
and which is due in part to the strong flows of foreign currency from sales
of oil and gas.

The central bank was trying to soak up these revenues by printing roubles.
Such printing, plus rising tariffs for electricity, gas and housing, was
driving up prices.

The government has responded to these pressures by raising its inflation
forecast for this year to 17-18 percent from an earlier 12-14 percent, but
insists that prices will dip for the rest of the summer months.

Another problem linked to the inflow of hard currency is a real strengthening
of the rouble, which is squeezing Russian producers by making them less
competitive.

Nash noted that the solution to such economic issues was intimately linked
with wider, long-term questions, such as having a properly functioning bank
system, which would be able to put the hard currency coming into Russia to
good use.

"At some point you have to have a banking sector if Russia is going to
continue its current rate of growth," he said.

"It is not as if you can ignore these reforms and everything will be fine as
you have this window of opportunity which is continuing to close," he said,
referring to the current relatively positive economic situation.

*******

#5
Delovye Lyudi
No. 124-125
July-August 2001
THE END OF THE POST-CRISIS ECONOMY
It is clear now that the Russian economy missed its chance
Author: Irina Skibinskaya
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
INVESTMENT WAS THE DRIVING FORCE OF ECONOMIC GROWTH IN 2000, WHILE THIS YEAR THE IMPETUS IS PROVIDED BY RISING DEMAND. THE ECONOMIC DEVELOPMENT AND TRADE MINISTRY IS PREPARED TO SETTLE FOR MORE MODEST FIGURES. POSITIVE TRENDS IN THE ECONOMY HAVE NOT BECOME STABLE, MUCH LESS IRREVERSIBLE.

The euphoria caused by the unexpected economic boom of 2000 has wound
down. The start of 2001 made it quite clear that developing this
success was not on the cards. Having exhausted the growth factors
generated by the crisis of 1998, the Russian economy entered a phase
of depressive stabilization. Some economic growth continues, but the
factors impeding it are multiplying.

Economic growth is slowing. This is inevitable. Analysts only
disagree on the figures and parameters of the slow-down.

The figures for January to May released by the State Statistics
Committee are indeed alarming. The vital indicators are lower than
they were in the same period of 2000. Output of goods and services in
the basic industries in January to May 2001 rose by 5.5%; in the same
period of last year, it rose by 10.9%. Capital investment grew by 4.2%
(against 16% last year), transport turnover grew by 2.2% (against 6.1%
last year), and foreign trade turnover grew by 8.2% (against 33% last
year). Retail trade is probably the only sphere where the growth
continues unchecked: it even rose from 7.6% to 9.7%. All this merely
confirms the suspicions of economists that investment was the driving
force of economic growth in 2000, and that this year the impetus is
provided by rising demand.

These developments jeopardize the initial forecasts and
indicators on which this year's budget is based.

The Economic Development and Trade Ministry is coming up with
more and more new plans and forecasts, revising its earlier
assumptions. These days, it is prepared to settle for more modest
figures. The Ministry insists that GDP growth for the year will be 4%.
Independent experts disagree. Alexander Frenkel of the Economic
Institute at the Russian Academy of Sciences is quite certain that
growth will not exceed 3.5%. Frenkel also thinks that the Ministry is
too optimistic in its predictions for industrial output: he says it
will be only 3.8% more than in 2000.

Experts are unanimous with regard to inflation. The 12% annual
inflation specified by the budget will be exceeded. Prices in Russia
rose by 10.8% in the first five months of the year, against the 5%
rise registered in the same period of 2000. Arkady Dvorkovich, Deputy
Minister for Economic Development and Trade, believes that inflation
will slow this summer, and amount to between 0.6% and 1% for the
season.

Senior Deputy Finance Minister Aleksei Ulyukayev believes that
annual inflation will be 14-16%.

Oleg Viugin of the Troika-Dialog brokerage estimates that
inflation in 2001 will reach 17-18%. Alexander Zhukov, Chairman of the
Duma Budget Committee, also says that the inflation rate will exceed
the figures specified in this year's budget, reaching 17-18% instead
of the planned 12%. The trend does concern him, Zhukov admits. Central
Bank Chairman Viktor Geraschenko is also urging lawmakers to revise
the budget's inflation parameters.

The Economic Institute at the Russian Academy of Sciences
considers even these estimates too moderate. Its specialists say
inflation for 2001 will be no less than 20%.

Inflation rates also jeopardize the future growth of consumer
demand. A survey conducted by the State Statistics Committee on behalf
of the Cabinet shows that two-thirds of enterprise directors don't
expect growing demand for their products over the next three months.
It's a vicious circle. Inflation is putting an end to the growth of
demand. Stagnation or reduction of demand endangers the financial
well-being of enterprises. They respond to it by cutting their
investment programs.

All this shows that positive trends in the economy have not
become stable, much less irreversible.

Yevgeny Gavrilenkov, Director of the Economic Analysis Bureau,
expects the growth rate to decline further. "It is inevitable, since
the objectively necessary structural and institutional reforms in the
economy and society are not being implemented as fast as necessary,"
he says.

Gavrilenkov also says that most investment in 2000 was in just
two sectors: electricity and transport. From the long-term point of
view, this structure of investment deprives the whole economy of a
future.

The reasons behind this situation are described in more detail in
some scenarios for economic development drafted by the Economic
Development and Trade Ministry.

The ruble firmed by over 10% in the second half of 2000. Needless
to say, this improvement resulted in more imports. The process of
import replacement, stimulated by the crisis of 1998, has now slowed.
It is clear now that the Russian economy missed its chance.

Falling demand for domestic products has affected the financial
position of enterprises and led to cuts in investment and output.

The Economic Development and Trade Ministry report says: "The
trend for post-crisis growth factors to disappear has affected
economic dynamics. Growth rates slowed in late 2000. Generally
speaking, the phase when the advantages of the post-crisis economy
were available ended in late 2000."

******

#6
Novye Izvestia
August 9, 2001
BACKING UP?
President Putin prepares a turnaround of the Russian economy
The Security Council's plans for national economic security
Author: Alexander Nadzharov
[from WPS Monitoring Agency, www.wps.ru/e_index.html]
WHEN HE WAS ELECTED, PRESIDENT PUTIN SET OUT TO BUILD A STRONG STATE IN RUSSIA. THE STATE STRATEGY OF NATIONAL ECONOMIC SECURITY TO 2010 SHOWS WHAT KIND OF STATE THE PRESIDENT CONSIDERS STRONG. IT'S ARMED TO THE TEETH, AND FENCED IN BY NUMEROUS SELF-IMPOSED RESTRICTIONS AND LIMITATIONS.

Late summer of 2001 may mark an end to the biggest political
illusion of our time: the illusion that authoritarian leftist methods
of government are compatible with a right-wing liberal economy.

Everything began with elaborations on the need to boost the role
of the state, the need to make oligarchs equidistant from the
corridors of power, and about the media being too insolent. President
Putin's natural drift to the left ended with the establishment of a
interdepartmental working group on economic security within the
Security Council. The group's tasks and composition leave no doubts
whatsoever about the president's true opinions on the nation's future.

We have obtained some documents which specify the task of
drafting a new State Strategy of National Economic Security to 2010.

Composition of the interdepartmental working group indicates
precisely how the national economy will be amended "in line with
presidential instructions given on May 19, 2001." The working includes
bitter opponents of a liberal economy - Academician Yuri Lvov (who
criticizes all the Cabinet's ideas and intentions), Duma deputy Sergei
Glaziev (author of the Communist Party's economic platform), FSB
Deputy Director Yuri Zaostrovtsev (who advocates criminal prosecution
for taking hard currency out of Russia), functionary Trofimov (who
dreams of revising the results of privatization), and others including
former officials of the Soviet Gosplan (State Planning). In short, the
team includes everyone whose economic ideas ruined the Soviet Union.

Prominent economist Aleksei Ulyukayev is the only liberal fly in
the pro-communist conservative ointment. On the other hand, who cares
about the personal opinions of an academic elevated to the corridors
of power?

Vyacheslav Soltaganov, former chief of the Tax Police, Deputy
Secretary of the Security Council, with the rank of general in state
security, is keeping an eye on implementation of the task in strict
accordance with the president's economic ideas. He is head of the
interdepartmental working group. This official's public statements are
extravagant enough to be remembered. It was Soltaganov who advocated
an all-encompassing system of secret financial police in Russia and
abroad. This led some business owners to start thinking about
defecting to the shadow sectors of the economy. It also led the
president to assign the notorious "economist" to the Security Council.

There, Soltaganov proved his ingenuity by drafting a plan for the
future economic development of the state.

Its very first paragraph specifies in no uncertain terms that the
status of Russia as a geopolitical power directly depends on
implementation of the concept of economic security.

Soltaganov proceeds to elaborate at length on the need to
formulate national interests in the economic sphere, and lists the
most probable threats to these interests.

Soltaganov's plan to make the Russian economy do a 180-degree
turn, back in the direction of the glorious past, reflects the ideas
of the people from state security structures. We live in the age of
global cooperation. Who in their right mind would constantly demand
complete self-sufficiency in goods and services? Or elaborate on
threshold levels of international contacts? How can they be set? The
Soviet Union bought up to 45 million tons of grain a year under Leonid
Brezhnev, and the economic security of the state was not considered to
be in jeopardy. Besides, what would be done if the economy doesn't fit
the threshold parameters set by specialists from the security
structures?

But the Security Council must be thinking that international
contacts pose the greatest threat to the state. Russia is integrating
itself into the system of global cooperation, and trying to become
competitive these days... But Soltaganov's plans are full of entirely
different postulates.

Legal issues take up the least part of the plan. In fact, they
fit into two lines: only stating the need "to set up economic and
legal conditions preventing criminalization of society and the
economy." Meanwhile, it is precisely this which should be the special
task of the Security Council.

When he was elected, President Putin set out to build a strong
state in Russia. This document shows what kind of state the president
considers strong. Prosperous families, and society in general, don't
matter in Putin's strong state. A strong state is one which is armed
to the teeth, and fenced in by numerous self-imposed restrictions and
limitations. According to the president, economic security takes
precedence over all other economic ideas.

Responsibility for implementing the orders issued by what is
essentially a new government formed within the Security Council will
be assigned to federal and regional government bodies.

*******

#7
Wall Street Journal
August 9, 2001
[for personal use only]
How Russia Can Fulfill Its Potential
By Paul O'Neill, secretary of the Treasury.

Recently, I visited Russia with my colleague Don Evans, the first step in a
new economic relationship between our countries. Over the past eight years,
the focus of relations was macroeconomic. Discussions were monopolized by the
bureaucratic and ineffective Gore-Chernomyrdin Commission. Our administration
is taking a different approach, built on informal, focused contacts with
Russian officials, as well as on the views of the private sector. We focus
more on achieving the microeconomic reforms that would attract investment
needed to drive long-term growth.

Three years ago, I traveled to Russia to explore investment in the aluminum
industry. It didn't happen. The facilities had potential, but we could not be
sure that we would be allowed to realize that potential. There were trolls
under every bridge.

Last month, I went back in a different job to a different Russia -- and noted
real change. Conventional wisdom says that the odds against small business
cannot be overcome and that Soviet-era plants and equipment cannot be
salvaged. This conventional wisdom is wrong.

There are, to be sure, pervasive barriers to investment. The most serious is
a lack of trust -- the lack of trust between people and government, federal
and local governments, bankers and clients, foreign investors and Russian
partners, managers and workers.

But trust can be built. I met a manager of a car seat plant who faced a
strike when he tried to replace a piecework wage with an hourly one. His
workers had been lied to so often that they resisted change that workers in
other countries would have welcomed. I talked to a banker from the Russia
Small Business Fund whose clients trusted him enough to show him cash stuffed
in mattresses. I dined with a head of an agricultural service business who
overcame skepticism about how much dairy productivity could improve by
actively showing farmers how it's done.

Russia's government needs to work hard to fulfill this potential. It has made
a start by lowering personal income taxes to 13% and corporate profit taxes
to 24%, and advancing investment climate reforms. But critical areas remain,
including banking, trade, and deregulation.

Banking: Russia must ensure that savings flow to productive uses. In market
economies, this role falls largely to banks; in Russia, banks finance less
than 5% of investment in the real sector. Most investment is financed by the
giant energy and natural resources companies, which invest in their own
industrial groups. Small- and medium-sized firms, the engines of growth in
successful transition economies, struggle to obtain financing. President
Putin has set a goal of lifting living standards to those currently enjoyed
by Portugal within 15 years. To do this, Russia needs to grow 6% per annum.
It will not sustain this growth without a financial sector that lends to new,
small firms.
The Central Bank must get out of commercial banking, implement prudent
regulation, eliminate obstacles to foreign participation, and insist on
transparent accounting. Laws and their enforcement must enable creditors to
foreclose on bad loans. Some banks are already doing sound lending. By using
efficient lending technology and training bankers in risk assessment, the
Russia Small Business Fund, backed by the European Bank for Reconstruction
and Development and the G-7, is growing rapidly and collecting over 99% of
its loans, even as it provides support for micro and small businesses.

Trade: Russia cannot achieve sustained growth without an open economy. We
welcome the strong interest in accession to the World Trade Organization, and
will help Russia meet membership obligations. Putting in place the rule of
law required to join WTO is the way to build confidence in the investment
climate.

Deregulation: Russia's federal authorities are advancing legislation to
reduce business regulation. But bureaucrats continue to stymie change. Our
bilateral assistance programs are focused on promoting good practice in
business and in government in the regions. We are now exploring how the
multilateral development banks can support changes at the local level that
reinforce federal reforms -- a marked change from the big money packages
provided to Russia during the Clinton era.
I offered U.S. help in pursuing practical solutions to achieve measurable
results, and suggested that we put together a list of issues on which both
sides would produce results by agreed dates. The Russians responded with real
interest. Advancing work on WTO accession, consulting on market-economy
status for Russia, cooperating on an anti-money laundering law, and exploring
new Export-Import Bank financing are already on our action list.

This approach -- focusing on areas where we have common interests, and
avoiding overpromises -- is the best basis for economic relations that would
benefit people in both of our nations.

*******

#8
pravda.ru
August 8, 2001
FURTHER ESTABLISHING A FACT: FOR THE RECENT 10 YEARS INVESTMENTS IN RUSSIAN SCIENCE REDUCED MORE THAN 5 TIMES

As a result -- impoverishment of scientific institutions, abrupt decrease of
education level, brain drain, loss of national economy's competitiveness. The
data was made public today, at a stuff sitting of Ministry for Industry,
Science and Technologies.

Decreasing investments in scientific research was called one of main reasons
of abrupt lowering of national economy's competitiveness. The volume of
investments in scientific and technical sphere decreased more than two times
from the year 1990 and made about 214 billion rubles (approximately 7,4
billion dollars). In general expenses for science have been reduced more than
5 times during the recent 10 years.

The situation in Russian science is near to catastrophe. Most of ministries
and institutions, leading high technology projects go in for business. Even
decisions about such important questions like nuclear energy depend on "how
much it costs" and "what we get from it". If the price of a question is
lower than certain level, it is simply not considered.

Commercialization of science caused not only brain drain, but also a rush for
money, often obtained for absolutely exaggerated projects, which have nothing
to do with science. Some of scientific programmes are directly financed by
the West through different grants. As a rule, these programmes' results are
found finally in the West, like the scientists themselves.

The today's staff sitting in the Ministry shows, that this issue finally has
been noticed. Though there was nothing but establishing the fact. The
situation reminds of Russian Health Ministry position, which almost for 10
years establishes the fact, that Russians die out, though it goes not further
than to publishing death and birth rates.

*******

#9
INTERVIEW-Russian naval reforms seen slow and expensive
By Mike Collett-White

LONDON, Aug 8 (Reuters) - It will take a long time and a large programme of
investment to reform Russia's navy, demoralised and weak after years of
underfunding, a top naval officer said on Wednesday.

Mikhail Barskov, vice admiral and deputy commander of the navy, welcomed the
approval last month by President Vladimir Putin of a new naval doctrine
designed to reassert Russia's status as a leading maritime power.

But he warned that change would not happen quickly.

"The navy is always an expensive luxury," he told Reuters in an interview in
London.

"This (reform) is a long-term plan, over 10 to 20 years. Shipbuilding takes a
long time."

The ambitious doctrine was interpreted as aiming to give Russia the
diplomatic clout that comes with being able to deploy a modern fleet around
the globe.

But analysts say putting it into practice will be difficult without a huge
injection of cash Russia can ill afford.

Barskov said reforms would concentrate on making the navy a leaner, more
efficient force.

"We need to improve the quality of all types of (naval) arms," he said. "As a
result of this the effectiveness of the navy will improve and with the rise
in efficiency the number of men will fall."

He would not detail planned cuts, but said that morale in the navy had begun
to improve after a decade of underinvestment and political marginalisation.

The force has been further traumatised by last August's shocking loss of the
state-of-the-art Kursk nuclear submarine and its entire 118 crew during naval
manoeuvres.

"The mood in the navy is already much better than it was a few years ago," he
said.

Senior naval officials have expressed frustration at not having the money to
modernise the existing fleet and develop new military hardware to close the
capability gap with former Cold War foe the United States.

Stephen Saunders, editor of Jane's Fighting Ships specialist publication,
said that the jury was still out over whether Russia could maintain an
effective navy over the long term.

He said Russia had 17 ballistic missile submarines, 26 attack submarines, 17
large surface ships, 50 frigate-sized vessels and around 70 500-1,000 tonne
ships.

"The attitude is changing, with the budget more focused on defence needs and
operational requirements," he said. But what that meant in terms of military
strength was less clear.

"It is unlikely Russia can increase the size of its fleet. The question is
really whether they can maintain spending and maintain their current
inventory," Saunders added.

******

#10
www.washingtonpost.com
August 8, 2001
On the Road in Russia's Land of Abundance
Feast on the River
A Worried Forester Hosts a Bucolic Banquet
By Robert G. Kaiser
Washington Post Staff Writer

CHITA, Siberia (Aug. 3)--We weren't prepared for the likes of Anatoli
Ivanovich Litvinov, master of 13,000 square miles of forest in the Chita
Oblast of Eastern Siberia. We had no way of knowing that Litvinov was
determined to shower two visiting Americans with the most elaborate
hospitality he could muster--which, as the potentate of his own kingdom of
birch and pine, turned out to be elaborate indeed.

His plan called for a helicopter ride across miles of forest, but that idea
had to be scrapped because of bad weather. But rain wouldn't stop the tour of
the taiga, or the picnic banquet, or the ride on a rubber raft down the brisk
Ingoda River, or the general celebration of nature, vodka and
Russian-American friendship. Litvinov was well received on a visit to British
Columbia and Washington State several years ago, and he clearly saw this as
an opportunity to reciprocate. We came to wonder who the nice people were in
North America who actually deserved the treat Litvinov had arranged for us.

Litvinov is a public servant in a troubled Russian Forestry Service, a proud
part of the Russian government for two centuries. It was recently
incorporated into a new ministry of natural resources in Moscow, a change
that has frustrated and exasperated its men in the field.

"We have lost our independence, our self-sufficiency," said Litvinov. The
bureaucratic change has thrown together those trying to preserve nature,
including the Forestry Service, and those trying to exploit Russia's natural
wealth-a forced marriage that can't work, according to Litvinov and his
colleagues. (For a detailed critique of the Forestry Service today from the
point of view of Russian environmentalists, go to forest.ru)

More immediately, the budget has been cut, except, apparently, for
entertaining foreign guests. We first met Litvinov in his pine-paneled office
at the outpost of the foreign service that is the headquarters of his
13,000-square-mile empire. There he tried to size up his visitors, while
quoting Mayakovsky and invoking Mother Theresa. He clearly wanted these Yanks
to understand that they were in the presence of a serious person who read
books and thought about the world. He held forth over tea and cookies-a
feeble hint of what was to come later.

"There's no stability in life," he announced at one point, "except in the
cemetery. And even there certain processes continue." Litvinov was eager to
tell his guests about his biggest problem: fire. He wouldn't be insulted in
the least if Americans wanted to help save Siberia's forests by contributing
money for helicopters or fire-fighting equipment, both in very short supply.
The fires are devastating, and the tiny band of foresters on Litvinov's staff
can't cope with them. One horrific blaze in 1998 burned 130,000 acres of
trees in a single night.

Ninety-five percent of the fires are the result of human carelessness, and
Litvinov has decided that his best defense is try to educate the public. At
his headquarters he has built a handsome hall for meetings, conferences and
gatherings of local schoolchildren. He has made a compelling videotape about
forest fires and their consequences, which he insists we watch for several
minutes. He also gave us copies of a book of poetry he had published, poems
by a local writer whose theme is man's debt to nature.

After this long warm-up the tour began. First we drove 30 km. to one of the
outposts of his empire, where a young man named Alexander Kornavalov is in
charge. Kornavalov has made a handsome wood-lined office with his own hands,
and clearly enjoy's his boss's affection and respect. Soon we will find out
why.

Then it is on to the banks of the Ingoda, a strong river perhaps 50 feet wide
whose fast-moving, clear water cuts through the Siberian taiga. Here
Litvinov's men, and two of their wives, had established a campsite that might
have been suitable for entertaining the czar, or at least the czar's
representative.

They have made a picnic table of freshly-cut, thick boards which have been
nailed to birch posts sunk into the ground. Benches on each side of the table
were made in the same way, though the seats were a little too high, so when
we sat down, everyone's legs had to dangle above the ground. The table was
protected from the light rain still falling by a nifty roof made of canvas,
hung like a peaked roof over freshly cut branches.

When we arrived the table was already groaning with a Siberian feast: two
kinds of tomato and cucumber salad; coleslaw; whole tomatoes; cold-cuts and
cheese; slices of brown bread; meat of the Guran, a miniature Siberian deer
considered (understandably) a delicacy. Shashlik (the Russian shish-kabob) of
pork grilled on a nearby fire and a delicious Bukhley soup (a meaty soup bone
and potatoes in a beef broth seasoned with dill) would soon follow. Later,
five distinct types of the best raspberries ever tasted by your
correspondents joined the culinary exposition.

All this was devoured in vast quantities, in spurts of consumption. The
eating began with a toast, and then was interrupted by one toast after
another. Litvinov was the master of ceremonies, and also by far the most
eloquent orator-a position he maintained even after consuming a daunting
quantity of Siberian vodka. But he insisted that each of his three colleagues
and his guests give their own toasts as well. The two wives who had prepared
the meal (except for the shashlik, a man's job) sat quietly together at one
end of the table.

From our side of the table we looked out across the river at a hillside of
birch and pine on the other side. Just down river the Ingoda split into two
streams around a small island covered in tall grass, making a pleasing
gurgle. Our host and his colleagues across the table faced the thick forest.
Pine smoke from the fire wafted across the table from time to time, another
flavor added to the feast.

While we ate the rain stopped. At about 8:15 Litvinov announced that there
was still time for a boat ride, and suddenly we found ourselves bouncing
through the forest, without benefit of road, in a four-wheel-drive van. After
several kilometers we were upstream from the picnic table on the edge of the
river again. Then a big rubber raft appeared from out of the back of the van,
and a pump to inflate it.

Litvinov himself insisted he would be the captain, though he was clearly
vulnerable if the authorities were to question his sobriety. On the other
hand, he was the authorities. Soon we were floating down the Ingoda,
occasionally guided by oars in the captain's hands. (To be perfectly fair,
the 53-year-old Litvinov was surprisingly sober, considering how drunk he
should have been.)

We arrived back at the campsite and were greeted by shouts of enthusiasm.
Alexander Kornavalov, a naturalist of many talents, had caught three big
trout while we were away, the third just moments ago. He accomplished this
feat with a primitive fishing rod and a home-made spinning lure, no bait
whatsoever.

"Well," said Litvinov, "we have to eat the fish!" Kornavalov and his wife
quickly cleaned them and put them into a pot with butter and slices of onion.
Fifteen minutes later, as the long Siberian summer day turned to a gray dusk,
we were eating a second dessert of plump trout and onions.

*******

#11
Los Angeles Times
August 9, 2001
New Woes for Ukraine Opposition
Europe: A key foe of the president is charged by Russia with bribery and
smuggling. Her party rejects move as political.
By ROBYN DIXON, TIMES STAFF WRITER

MOSCOW -- Russian prosecutors issued bribery and smuggling charges Wednesday
against a high-profile Ukrainian opposition figure who already faces
corruption charges at home.

The accusations against Yulia Tymoshenko came 10 days after Vladimir V.
Putin, the president of Russia, visited Ukraine and met with President Leonid
D. Kuchma, signaling closer ties between the two nations.

The Russian charges are a boost for the Ukrainian president, who has been
battling political scandal over claims he was involved in the killing of
journalist Georgi Gongadze last summer. Tymoshenko is a thorn in Kuchma's
side, one of the leading opposition figures involved in a campaign to oust
him over the allegations. The Russian charges against her add weight to the
original Ukrainian case, which Tymoshenko's supporters claim is politically
motivated.

The Gongadze scandal has damaged Kuchma's standing at home and in the West.
Putin has been firmly supportive, however, edging Ukraine back into Russia's
sphere of influence.

Ukraine still depends on Russia for most of its energy needs, and Kuchma has
forged closer ties with Moscow in recent months--even while assuring Western
officials of his nation's independence.

Tymoshenko was arrested in February in Ukraine on the corruption charges and
released in late March. She is forbidden to leave Ukraine and faces regular
interrogations by prosecution officials.

Tymoshenko, the onetime head of United Energy Systems, a large private firm,
was named deputy prime minister in charge of Ukraine's energy sector in late
1999. She was ousted by Kuchma in January.

The Ukrainian prosecutor accuses her of stealing and exporting gas and
funneling millions in bribes to former Ukrainian Prime Minister Pavlo
Lazarenko, who is in a U.S. jail awaiting trial on charges of money
laundering. Tymoshenko has denied the charges she faces.

The new Russian charges from the military and civilian prosecutor-generals'
offices in Moscow were handed over to the Ukrainian prosecutor-general to
handle.

One charge centers on the accusation that she bribed Russian officials; the
other alleges that she and her husband tried to smuggle $100,000 out of
Russia in 1995. According to prosecutors, the couple was caught at an airport
with money concealed in bags of food.

It is unclear why the Russian prosecutors took so long to bring the charges.

In Russia, the prosecutor-general's office frequently has been accused of
filing cases for political ends, vigorously pursuing those who anger the
Kremlin.

Tymoshenko's political party in Kiev, Ukraine's capital, issued a statement
repudiating the new charges.

"This is a cheap provocation, fabricated under the influence of President
Kuchma with the aim of compromising the opposition movement, which is every
day growing in influence and gaining millions of supporters among Ukrainian
citizens," the statement said.

Yulia Mostova, a political analyst in Kiev and editor of Zerkalo Nedeli
newspaper, said that Tymoshenko was "certainly no angel" but that there had
been no evidence produced to substantiate the charges against her.

"Now a Russian warrant has been issued, but it was issued after Leonid Kuchma
and Vladimir Putin had two meetings with each other," she said. "The
attention to Tymoshenko's case proves that Vladimir Putin wants to give
trifling services to Leonid Kuchma, but in exchange [the Russian president]
is demanding more serious things."

Ukraine is heavily in debt to Russia for energy purchases, and Moscow is
eager to get control of key sectors of its industry in payment.

*******

#12
BBC Monitoring
Anti-terrorism the new Russian ideology, Chechen deputy premier
Source: Chechenpress web site, Tbilisi, in Russian 6 Aug 01

"Anti-terrorism" has taken over from socialism and communism as the official
ideology of Russia, according to Akhmed Zakayev, deputy prime minister of the
self-declared Chechen Republic of Ichkeria. Reports of Chechen hijacks or
terrorist attacks are used to fan the flames of this ideology, Zakayev said,
although the involvement of Chechens in most of these attacks remains
unproven. Russian President Vladimir Putin, who describes the war as an
"anti-terrorist operation" and calls all Chechens terrorists, is seeking to
destroy the Chechens as a nation, Zakayev said. The Chechen people understand
this and will never accept the occupying regime. They have a system that
enables them to resist the occupiers indefinitely. The following is the text
of a report by Chechenpress news agency web site:

6 August: Here is an interview with Chechen Deputy Prime Minister Akhmed
Zakayev by the Chechenpress state news agency:

[Correspondent] Could you tell us how the current military and political
situation in the Chechen Republic of Ichkeria [CRI] differs from that at the
beginning of the Russo-Chechen war?

[Zakayev] In order to understand the current military and political situation
in the CRI, I would like to draw your attention to a very important
characteristic of the current war. This could be done in parallel with the
characteristic of the previous war. Boris Yeltsin set himself a task which
was "to restore constitutional order", i.e. reincorporate the Chechen
Republic. In autumn 1996, after two years of intensive military operations,
the Russian leadership deemed it necessary to end the military operations and
withdraw their troops when they realized that Chechens were not willing to
live under a colonial power. Yeltsin's public repentance, when he called war
in Chechnya his biggest mistake, made us think that the first Russian
president, as he called himself, waged a war not against the Chechens, but,
let us say, for the sake of Russia and its territorial integrity and so on.

The title of Putin's war - an anti-terrorist operation - obviously
demonstrates the task he has set himself. Terrorism is considered a grave
crime and terrorists are to be killed all over the world. Russia is
dishonestly using all its forces and presenting Chechnya as a source of
international terrorism, which threatens the world order. Putin and his team
have been rejecting all political criticism of their anti-Chechen campaign
since the start of this war. Putin, knowingly or unknowingly, admitted that
the political status of Chechnya is not very important to him. Declaring all
Chechens, including women and children, to be terrorists and ignoring the
political aspect of the anti-Chechen war, and subjecting civilians in
Chechnya to horrors are the characteristics of the Putin war. It is a war on
ethnic grounds, the aim of which is to destroy Chechens as a nation. Today,
after two years of war, the military and political situation in the CRI has
partially been formed on the basis of the Chechen people's understanding that
this war is being conducted purely on ethnic grounds and against the Chechen
people. The people will never accept the occupation regime. The Chechens were
not ready for this war at the start of it. They did not want it to happen
because there is irreparable damage in the wake of every war.

Now we have only one way to survive - resistance. I am telling you this
without going into details that Chechens, who are headed by their elected
president, have an effective all-national military and political
organization, which is able to properly resist the occupiers for an
indefinite period.

[Correspondent] Citizens of the CRI periodically carry out acts of terrorism
involving hijacking of buses or planes. Could you comment on these crimes?

[Zakayev] First, despite the fact that the Russian security services have
been speaking about this for the last 10 years, acts of terrorism involving
the hijacking of buses or planes are not being carried out by citizens of the
CRI. Last winter a Chechen called Supyan Arsayev together with his sons, with
empty threats forced a Russian plane to land in Saudi Arabia . They did not
want money, nor did they want to free anyone from jail. They had only one
demand: stop the killing of Chechen people, which is apparent to the world
community. The involvement of Chechens in other acts of terrorism, such as
the explosion of houses, markets and buses, has not been proved. My comment
on these crimes is: the Putin regime has adopted "anti-terrorism" as the
official ideology of Russian society, as in the case of socialism or
communism in the known era. Acts of terrorism for today's Russia serve as
fuel for the fire. The fire will go out if you do not feed it with fuel.

[Correspondent] Why has the world community, particularly the USA, ceased to
pay attention to the military crime of the Russian troops against humanity in
the CRI?

[Zakayev] Unfortunately, the governments of super powers, particularly the
USA, either do not pay attention to the crime of the Russian military or do
very little to stop it. The Chechens have the right to accuse the world
community of a policy of double standards. For instance, Putin is no better
than Milosevic, who was fairly prosecuted for his crime against humanity. At
the same time, the leadership of Chechnya and the Chechens are eternally
thankful to the many humanitarian and human rights organizations, that are
involved in the investigation of the Russian military's crimes in Chechnya.

[Correspondent] What should the Chechens do in order to build an independent
state?

[Zakayev] Chechnya will celebrate the 10th anniversary of its independence on
6 September this year. The Chechen Republic has been proving its capability
in the middle of an unequal conflict with the criminal Russian state over
these years. Four years of our 10-year sovereignty have been devoted to
direct fighting on a large scale. There is no doubt that the occupiers, as in
the case of the first Chechen war [in 1994-96], will be forced to make
themselves scarce from the republic. Certainly, there have been mistakes and
miscalculations in many respects in the state building process. We already
have answers to many of our problems. The main task for us is to be freed
from the occupiers.

[Correspondent] The date 2 August marked the second anniversary of the
well-known Dagestani events [incursion from Chechnya into Dagestan]. What are
your comments on this?

[Zakayev] People should be aware that those events were provoked by the
Kremlin in order to uproot a determined national and liberation movement in
Dagestan and, certainly, to have a good excuse for another incursion into
Chechnya. The crime committed by the Russian military against Dagestanis and
the residents of the notorious buildings in Moscow, Volgodonsk and Buynaksk,
and also the crime against the Chechen people will not go unpunished. The
time of reckoning is near.

[Correspondent] The anniversary of the Jihad military operations is in August
1996. What is your comment on this?

[Zakayev] During the first and second wars we witnessed many heroic battles
of the Chechen Republic's patriots against the occupiers. The Jihad
operations which, in fact, ended the first Russo-Chechen war will stay with
us forever. As a participant in those operations, I remember my friends. Many
of them did not survive. I wish that our fighters and all citizens of the
Chechen Republic could stage a similar military operation and end the current
Russo-Chechen war.

Thank you for your questions.

*******

#13
Centenarian Recalls Fighting Russians
August 8, 2001
By ANDREW KRAMER

EUGENE, Ore. (AP) - Like thousands of other young men at the time, Harold
Gunnes left high school early in 1917 to join the Navy and fight in World War
I. But instead of sailing to France, Gunnes was sent on an obscure and
hazardous mission to northern Russian.

Today, he is even more unusual.

At 102, he is believed to be the last American alive who fought in the North
Russian Expeditionary Force - sent by the allies to fight Russian Communists
in that country's civil war. It marked the only direct warfare between Russia
and the United States.

Most of the other soldiers and sailors on the expedition were older than
Gunnes, and all other known survivors have died, according to a Navy
historian and others knowledgeable about the military history of the World
War I era.

In the 1918-1919 conflict, Gunnes marched through swamps and birch forests in
the Russian Arctic near the port of Arkhangelsk on the White Sea to storm a
village before being forced to retreat to the sea.

``I was way up the line fighting the Red Russians,'' says Gunnes, whose
memories of that oft-overlooked mission are intact even after more than 80
years.

The American expedition was never well known. In his 1984 State of the Union
address, President Ronald Reagan said Russians and Americans - while having
their differences - ``have never fought each other in war.''

Someone should have asked Gunnes.

``It wasn't a big war by any means, but the fighting was just as bad'' as the
fighting in Europe during World War I, Gunnes said during an interview at his
home in Eugene, his 94-year-old wife, Evelyn, always near at hand.

Because of the great span of his life, Gunnes has a panoramic view of 20th
century history.

The warship that took him to Russia had cannonball dents in the bow from
action in Manila harbor in the Philippines in the Spanish American War of
1898. Born in 1899, he has witnessed the birth of the automobile, the vinyl
record and the Internet.

Gunnes now moves in slow motion. Even with a powerful hearing aid, he is
forced to interrupt the conversation to point one of his long fingers at his
ear, telling a reporter to speak louder.

But his speech is perfectly lucid.

``Why am I so important?'' he said. ``Thousands of others did what I have,
only I've lived longer.''

He is likely the last of the 5,500 or so Americans who fought in Russia with
the Army's 339th Division, the so-called ``Polar Bears,'' and about 50
sailors who joined the landing party from the USS Olympia. A related mission
of Americans who entered the Pacific port of Vladivostok encountered bandits
but did not directly engage Bolshevik troops.

Most of the soldiers and sailors of that mission to northern Russia joined
the service in their mid-twenties, according to Stan Bozich, co-founder of
the Polar Bear Memorial Association in Frankenmuth, Mich., a group
established to honor veterans of the conflict. The last known ``Polar Bear''
died nine years ago, according to Bozich.

Dennis Gordon, author of ``Quartered in Hell,'' a book about the
expeditionary force, interviewed many of its Navy veterans in the late 1970s.
He said it is unlikely any is still living.

U.S. Navy historian Raymond Mann concurred, but said he could not be certain.

Gunnes left Barnesville, Minn., to sail on the Olympia in 1917. Bristling
with broadside guns, the ship was used to ferry American troops to England
past German submarines in World War I. In the mid-Atlantic in 1918, the
Olympia was ordered to steam to Russia.

The assignment of the expeditionary force of Americans, English, French and
others was to help the ``White'' Russian forces depose Vladimir Lenin,
Russia's new Communist leader of the ``Red'' Russians.

On Aug. 2, 1918, on the orders of President Woodrow Wilson, the ship steamed
into Arkhangelsk, a city then made of log houses and magnificent
multiple-storied log churches, many built without nails by skilled Russian
woodworkers.

But covered in mud and impoverished by civil war, Gunnes said it ``looked
like junk'' to him.

His group traveled on barges up the Dvina River, a cold stream of muddy water
looping through low hills, peat bogs and birch forests east of the White Sea,
to a village where one of the first engagements between Russian and American
troops took place.

Gunnes recalls trudging through a birch forest toward the town of Seletsko, a
fishing and logging village about 200 miles from the White Sea.

That's when the Bolsheviks opened fire.

Gunnes dropped onto what he recalled was wet and cold ground on the forest
floor and began squeezing off rounds from his Mosin-Nagants rifle toward the
Russian lines. The allies forced the Bolsheviks from their trenches in that
firefight.

Gunnes recalls that as he walked into the village on Sept. 23, 1918, he
noticed a frayed rip in the sleeve of his friend George Perschke's jacket.

``Hey, look at your arm,'' Gunnes told Perschke.

``We didn't know he was hit until we took his coat off. There was a gash in
his arm,'' and blood dripped out of his sleeve onto the muddy street, Gunnes
recalled.

A Navy report on the skirmish describes Perschke's wound as ``the first
American blood to be shed on Russian soil for the cause of democracy.''

The Bolsheviks, meanwhile, had flanked the allied force.

``We ran out of ammunition and food. I was young and didn't have the sense to
be scared,'' Gunnes said.

The cold, mosquitoes and lack of sleep were deleterious for the troops, and
they were outnumbered. They slipped through the Red lines at night.

In November, the force from the Olympia sailed for England.

That was it for Gunnes, but the little war in the north continued.

U.S. Army soldiers fought on until summer, when they, too, left. The
Bolsheviks solidified their power and ruled until the collapse of the Soviet
Union in 1991.

And Gunnes?

He returned to Minnesota and opened a hardware store, worked through the
Great Depression and World War II and moved to Hillsboro, Ore., in 1951. He
fathered, and outlived, his two sons but still has three stepchildren and 17
grandchildren.

These days, he spends his time walking in the back yard of his home, drinking
coffee in the afternoon and driving his Buick Park Avenue.

Perschke, Gunnes' friend and the first American wounded in Russia, visited
the Gunneses in Hillsboro about 15 years ago. But Gunnes hasn't heard from
him lately.

``All of those that I correspond with, they're all gone,'' he said.

The United States and Russia fought as allies in World War II. Their armies
never engaged directly during the Cold War.

*******

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