CDI Russia Weekly

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Edited by David Johnson
ISSUE #50May 28, 1999


The CDI Russia Weekly is an e-mail newsletter that carries news and analysis on all aspects of today's Russia, including political, economic, social, military, and foreign policy issues. With funding from the Carnegie Corporation of New York, CDI Russia Weekly is a project of the Washington-based Center for Defense Information (CDI), a nonprofit research and education organization.


Contents


  1. Moscow Times: Pavel Felgenhauer, DEFENSE DOSSIER: Back to a Nuclear Future.
  2. Itar-Tass: Russia Issues Statement on Indictment of Serb Leaders.
  3. The Globe and Mail (Canada): Geoffrey York Bombs damaging ties, Russians say. But problem not seen as long-term threat.
  4. Itar-Tass: Russian Military Firms Joining To Make Consumer Goods.
  5. NTV: Experts View Yeltsin, Stepashin Prospects. (Liliya Shevtsova, Georgiy Satarov, Leonid Radzikhovskiy).
  6. Christian Science Monitor: Frank Cilluffo and Todd Nelson, Rewarding Russia for what? Loans from West flow in spite of political antagonism and corruption.
  7. Komsomolskaya Pravda: Drunken Soldiers Almost Seize Missile Unit.
  8. The Russia Journal: Moscow Must Address Role of Armed Forces in Possible Social Unrest.
  9. Pravda: Colonel Vasily Izgarshev, The Fleet: Was it Sea-Going, or Will it Become Coastal?

#1
Moscow Times
May 27, 1999 
DEFENSE DOSSIER: Back to a Nuclear Future 
By Pavel Felgenhauer 
Pavel Felgenhauer is chief defense correspondent for Segodnya. 

Last week, Nuclear Power Minister Yevgeny Adamov publicly unveiled his ideas 
on the future of the nuclear industry. Adamov believes that Russia and the 
whole world should be awash in power plants and nuclear reactors and that the 
present scale-down will be reversed. 

Nuclear power development has been stagnating worldwide since the disaster in 
Chernobyl in 1986. When the Cold War ended soon after Chernobyl, this, too, 
diminished investment in military nuclear programs in Russia and the United 
States. As a result, there is a world glut of cheap natural uranium, as 
producers were developing capabilities to meet a much bigger demand. 

In the 1960s and 1970s, fast nuclear "breeder" reactors were internationally 
considered the best energy source for the future. Such reactors produce 
energy and increasing amounts of plutonium. The plutonium produced by the 
"breeders" has an energy potential that is bigger than that of the original 
uranium. 

Today, Adamov acknowledges, breeder reactors have become irrelevant. It is 
much cheaper to use existing stockpiles of uranium to extract plutonium than 
to reprocess highly radioactive used reactor fuel. According to the Fuel and 
Energy Ministry, more than 160,000 tons of spent fuel have been produced 
worldwide since the beginning of the nuclear age. Less than 10 percent of it 
has been reprocessed. Each year, 10,000 tons of spent radioactive fuel pile 
up and only 3,000 tons of it is reprocessed to extract uranium and plutonium. 
This discrepancy between production and reprocessing is growing. The German 
government recently said it will stop sending spent fuel from German reactors 
for reprocessing in France. 

This means more and more spent fuel needs to be stored. Adamov sees the 
growing international demand for nuclear storing facilities as a golden 
opportunity for Russia and for his ministry. Russia could take highly 
radioactive waste from other countries and keep it for future reprocessing, 
earning billions of dollars in the meantime. Adamov says that spent fuel 
collection and storage is a "$150 billion business." 

France and Britain are already taking in foreign nuclear waste, so "Russia 
should fight for its share of the market." 

The Nuclear Power Ministry has already figured out how to spend this future 
windfall. Adamov believes that in 30 to 40 years the demand for nuclear 
energy will again begin to grow dramatically. Chernobyl will be forgotten. 
Anyway, Adamov says, "after Chernobyl we have modified our reactors in a way 
that makes such a disaster impossible." 

In the West and in Russia, nuclear power production is stagnating. Russian 
nuclear plants are producing electricity at 56 percent of capacity. The rest 
simply goes into steam, since large parts of industry are not producing 
anything. 

However China, India, Iran and other Third World countries are today 
increasingly interested in developing nuclear power. Adamov believesthat as 
potential hydroelectric power sources are used up and consumption of fossil 
fuel is restricted to control greenhouse gas emissions, other countries will 
also consider the nuclear option. The current glut of uranium will be soon 
spent and all the previously accumulated nuclear waste will be needed for 
recycling. 

In the meantime, Russia will use the money it gets for storing foreign 
nuclear waste to produce a new generation of fast breeder reactors and a 
"closed" nuclear fuel cycle, in which plutonium is produced, extracted and 
reused. 

"One would need only 5 tons of uranium to start such a reactor and afterward 
it will be producing its own fuel," Adamov says. Of course, Russian 
ecologists are adamantly opposed to Adamov's plans. Current law also forbids 
the storage of foreign nuclear waste. But Adamov has a powerful weapon to 
pressure Russian authorities - the military nuclear program. 

Last month the Security Council ordered the development of a new generation 
of nuclear warheads. Last week Adamov complained that "they told us to 
accelerate military nuclear programs, but said we should do that using our 
own sources of revenue." The Nuclear Power Ministry clearly says that without 
money coming from the West as payment for nuclear storage, Russia cannot 
manage a new generation of nuclear weapons. 

Six deputies in the State Duma have sponsored legislation that will allow 
Russia to take foreign spent fuel. Of course, such legislation will hardly be 
approved soon. But the nuclear lobby can wait. As relations with the West 
deteriorate, development of new nukes may become more important than 
ecological purity.
Back to the top

#2
Russia Issues Statement on Indictment of Serb Leaders.
MOSCOW, May 28 (Itar-Tass) - Follows a full text of the statement of the 
Russian Foreign Ministry, received by Tass on Thursday: 

"The decision of the Louise Arbour, Chief Prosecutor of the United Nations 
International Criminal Tribunal for former Yugoslavia, to sign an indictment 
against five top political and military leaders of the Union Republic of 
Yugoslavia, including the Yugoslav and Serb presidents, can be regarded only 
as an action, motivated by purely political considerations. 

The haste, with which the prosecutor conducted the investigation and drew her 
categorical conclusions, looks surprising. It is obvious, however, that, in 
the current situation in Yugoslavia and around it, such decisions require 
special care and circumspection. 

One can hardly regard as accidental the fact that this step was taken exactly 
at the time, when the talks on the settlement of the Kosovo problem are 
entering the decisive stage. Now the negotiating process will become more 
complicated. 

At the same time, Louise Arbour shows surprising passivity in the face of the 
obvious fact of the NATO aggression against Yugoslavia and remains 
indifferent to the consequences of incessant bombing, that has been going on 
for two months. She shows no emotions over the death of hundreds of guiltless 
people, the destruction of the economic and social infrastructure of the 
country, the turning of historic monuments into ruins and the threat of an 
ecological catastrophe. Isn't is the business of the prosecutor to find out 
who gives orders on dealing massive blows, which bring about such horrifying 
consequences? Unfortunately, Ms.Arbour keeps silent on all those issues, 
which shows that her approach to the problem is by no means impartial. 

Russia will continue to exert efforts, aimed at finding a way to a just 
political settlement, and with this in view, it will continue to work 
actively with all those with whom it is necessary to work, including in 
Yugoslavia. This is in line with the role in the settlement of the current 
crisis in the Balkan Peninsula, which the world community recognises as 
befitting Russia."

 
Back to the top

#3
The Globe and Mail (Canada)
May 26, 1999
Bombs damaging ties, Russians say
But problem not seen as long-term threat
Geoffrey York, Moscow Bureau

Moscow -- The NATO bombing of Yugoslavia is creating tension in Canada's
traditionally good relations with Russia, a group of Canadian MPs have warned.

The MPs, who ventured into Russia last week on a six-day visit, were hit
with a barrage of criticism from Russian political and religious leaders
angered by Canada's participation in the bombing.

The Canadians' overall assessment, however, was that the problem is not a
serious one, does not extend to the Russian public at large, and will not
prove a long-term threat to the relationship between the two northern
neighbours.

The MPs had planned to focus on parliamentary relations between Canada and
Russia, but their agenda was quickly hijacked by Russian anger with the
North Atlantic Treaty Organization. Even Alexy II, Patriarch of the Russian
Orthodox Church, lectured the Canadians about the NATO attacks and told
them that the bombing must stop.

"t virtually every meeting, regardless of the topic, Kosovo would come up,"
said Peter Adams, a Liberal MP in the delegation to Russia. "Usually they
would ask, 'What are you doing, bombing these people? You're destroying a
country -- why are you doing it?' Some of them said that all we are doing
is following the Americans."

Reform Party foreign-affairs critic Bob Mills said the Russians made it
clear that the NATO bombing is causing some short-term damage to
Canada-Russia relations. Several of them accused Canada of being a "puppet"
of the United States, he said.

"They're mad at us," Mr. Mills said. "They're mad at Canada for going along
with the United States, and they're mad at the United States for trying to
be the big policeman of the world. They all told us it's a big mistake and
we shouldn't have gotten involved in a U.S.-led operation."

Foreign Affairs Minister Lloyd Axworthy found the same reaction at a
meeting with Russian regional leaders in Ottawa last month. He wanted to
talk to them about co-operation on northern issues, but almost immediately
they demanded an explanation for Canada's participation in the bombing.

"They're baffled by why Canada has been sucked into what they see as
U.S.-led aggression," said Richard Colvin, head of the Moscow office of the
Canada-Russia Parliamentary Program.

"Over all, Canada-Russia parliamentary relations are still in good shape.
But Kosovo comes up in almost every political-level meeting. Some damage
has been inflicted."

Several Russian politicians told the Canadians that the Kremlin should take
some form of retaliation against NATO members, including Canada. "Some of
the Communist hard-liners said they want to punish Canada, perhaps in the
area of trade," Mr. Mills said. "But we don't have a lot of trade with
Russia. I think it's a pretty idle threat."

Most Canadian officials are confident that Canada will survive the Kosovo
crisis without any serious blow to its Russian relationship. "I don't see
any negative repercussions," said Anne Leahy, the Canadian ambassador to
Russia. "There's no indication of less co-operation. We are talking, we are
working together."

When Russian politicians criticize Canada's participation in the bombing of
Yugoslavia, they preface it by saying that their bilateral relations with
Canada are "excellent," Ms. Leahy said.

Russia's pro-Western politicians, however, could suffer some damage as a
result of Kosovo, she acknowledged. "The reformers feel very vulnerable.
They were perceived as friends of the West. They feel it is harming them."

Dominic Gualtieri, president of the Canadian Business Association in
Russia, said the Kosovo conflict hasn't affected the Canadian business
community here. But that is partly because of Canada's low profile, he
said. He has talked to many Russians who didn't realize that Canada is a
NATO member.

"Canada is not very closely associated with the air strikes," he said. "We
have a reputation as a peace-loving country. Obviously the issue has come
up, but I don't think Russia can afford to put passion ahead of sound
business practices."

Despite the Kosovo crisis, most Russians still feel a lot of good will and
friendliness toward Canada, partly because they see it as a northern
neighbour without any imperial ambitions, the MPs said. Most of the Russian
hostility toward NATO is focused against the United States, they noted.

Moreover, most Russian leaders still want to improve their economic
relations with Canada and attract more Canadian investment, the MPs said.
In the long run, they believe, Canada can recover from any damage suffered
in its relations with Russia.

"I don't see any rapid deterioration," Mr. Adams said. "It's a concern, but
not an overwhelming concern. Our decision on Kosovo was made with the best
of intentions. If there is some heat, some fallout on our economic and
cultural relations, we have to take it."

While Canada is not suffering as much criticism as the United States, there
is little doubt that the Kosovo crisis has triggered a surge in
anti-Western feelings in Russia.

Back to the top

#4
Russian Military Firms Joining To Make Consumer Goods  

MOSCOW, May 26 (Itar-Tass) - "A consortium of 
hi-tech enterprises of the military-industrial complex is being formed in 
Russia to manufacture consumer goods," Head of the Project and Chief of 
the Demand Formation Centre (DFC) Pyotr Vernik told reporters here. 
The project is called "Ladomir - Lunar City Technology". The name is 
quite symbolic and implies the use of high technologies to create living 
conditions for human beings in a Lunar City, as well as the satisfaction 
of all the earthy requirements of the Russian people. The consumer goods, 
which the consortium will produce, belong to the "household electric 
appliances" group. The merger of defence complex enterprises into a 
consortium is being done on voluntary lines. 

"The Russian high technologies, formerly intended exclusively for the 
solution of military and space tasks, will be used, at long last, to 
manufacture civilian goods," Vernik stated. All the commodities, which 
the enterprises of the consortium will turn out in accordance with this 
project will bear the Russian trade mark of "LADOMIR". 

Vernik told Itar-Tass that some enterprises, which DFC has merged into a 
consortium, had worked yet in the sixties on a project to settle human 
beings on the moon. Special technologies were developed for this purpose, 
which were classified secret for many long years. Russian scientists and 
designers have conceived and developed everything that should surround 
human beings on the moon, including household appliances. Today, these 
secret technologies are being declassified and will henceforth be used in 
civilian production. The consortium's enterprises shall work, and are 
already working, according to dual-purpose technologies. This means that 
they will continue to fill space and defence orders, while setting up, 
parallel with this, additional facilities for making household goods. It 
is worth noting that both these production sectors of the said 
enterprises will supplement each other. 

Back to the top

#5
Experts View Yeltsin, Stepashin Prospects  

NTV
23 May 1999
[translation for personal use only]

>From NTV program presented by Yevgeniy Kiselev -- live or recorded 

  [Presenter Yevgeniy Kiselev] We shall discuss last 
week's major political topics with leading experts and politologists. Our 
guests are Liliya Shevtsova, the leading expert at the Moscow Carnegie 
Endowment; Georgiy Satarov, the Indem Foundation's president, and Leonid 
Radzikhovskiy, the Segodnya newspaper's political observer. Good 
afternoon. 

  [Experts] Good afternoon. 

  [Presenter] My first question is as follows. The left-wing forces were
making threats to lead people out into the streets, in case [former First Deputy 
Prime Minister Yuriy] Maslyukov or [former First Deputy Prime Minister 
Gennadiy] Kulik are sacked, let alone [former Prime Minister Yevgeniy] 
Primakov. They were saying that they would organize mass civilian 
disturbances. However, when [Russian President Boris] Yeltsin sacked 
Primakov, there was a chorus of voices saying the impeachement would be 
supported and [Russian Prime Minister Sergey] Stepashin would never be 
confirmed as prime minister. What we are witnessing now is: impeachment 
has failed, Stepashin has been confirmed at the first voting. Why? What 
are the reasons? 

  Liliya Fedorovna, please take the floor. 

  [Shevtsova] All failed forecasts go to prove yet again that we know our 
ruling class and the mood in the society very little. [Omitted: Shevtsova saying 
the impeachment failure showed that the Duma is not ready to go against 
the president and thus has confirmed a short-term prime minister; she 
says that Stepashin is seen as a puppet prime minister and a lesser evil 
in contrast to other candidates] 

  [Presenter] Same question to Georgiy Satarov: why has everything passed so 
smoothly? 

  [Satarov] I think that the result of this destabilization, in other words, 
Primakov's dismissal, impeachment failure and Stepashin's confirmation, 
clearly shows that the opposition did not care much about [Primakov's] 
government, compared to their care of themselves. When the choice was 
between preserving and fighting for the government and preserving 
themselves, they have chosen themselves. [Omitted: deputies wanted to 
give Stepashin more freedom and independence by their smooth voting] 

  [Presenter] Now I address the same question to Leonid Radzikhovskiy. What
is your answer to the same question? 

  [Radzikhovskiy] The whole impeachment saga has proved yet again that
Yeltsin and his analysts are very good psychologists. They rely on the instinct of fear 
of the so-called opposition. They are hardly ever wrong. [Omitted: more 
in the same vein; Stepashin's smooth confirmation in the Duma was a 
message to the president implying Duma's support of the president as much 
as the president's] 

  [Presenter] Now I would like to ask all our guests whether Stepashin's 
confirmation is the president's victory or defeat. Many people thought 
that Yeltsin aimed the government reshuffle at dissolving the Duma and 
calling early parliamentary elections in the long run. It so happened 
that there is no pretext to dissolve the Duma and the elections are 
planned for December 1999. What do you think, Liliya Fedorovna? 

  [Shevtsova] I am unwilling to evaluate Stepashin's confirmation as the 
president's straight victory or his defeat. It has happened many times 
before that tactical victories of the president's team turned out as 
strategic failures for Yeltsin and the president's institute as a whole. 

  [Omitted: Shevtsova thinks that we can speak of Yeltsin's victory only if 
Stepashin will strengthen Yeltsin's political foundation, an increased 
political rating of the president or prolong his political life after 
2000. Another question is, says Shevtsova, whether Stepashin will want to 
do so and whether he is capable of doing it] 

  In the long run, similar small successes and euphoria from alleged 
victories in the presidential administration may turn into a devaluation 
of the institute of the prime minister and the government as a whole, 
further humiliation of the parliament and possibly a degradation of 
presidency as an institute. 

  [Presenter] Same question goes to Satarov. Do you think that Stepashin's
easy confirmation as prime minister came as an unpleasant surprise for the 
president and those who had planned it? There is a theory, as you know, 
that they wanted the Duma to fail to confirm Stepashin thrice and as a 
result early elections would be called in September. 

  [Satarov] First of all, when we begin counting points or talk about
victories and defeats, it would be advisable to reckon with another important 
player, and that is the country's citizens. Out of our viewers 
approximately 80 percent may not have supported Primakov's dismissal. 

  However, the same 80 percent should be very well aware that his 
government which had had no other precedent in terms of the large support 
of the population, was given away by the president and the Duma together. 

  Second. It is a defeat fo Russia's political system because it was
incapable of preserving something which is beneficial for the country and its 
people and not only for the polticial elite. 

  Talking about victory, it is a joint victory of the president and the Duma. 
Their instinct of self-preservation has won. 

  [Presenter] The floor goes to Radzikhovskiy. 

  [Radzikhovskiy] These events may be described as both a victory and a
defeat for the president. In terms of defeat, Yeltsin may have suffered yet another 
defeat, may be the last one in his political career, a most serious 
defeat in the eyes of the public opinion. [Omitted: Radzikhovskiy recalls 
the impeachment debate, when nobody could say a word of praise about the 
president] 

  At the same time there is a certain victory. A relatively independent 
govenment has been destroyed. An attempt is made to form a government 
which will be wholly under the presidential administration's control. 

  [Presenter] What kind of government is Stepashin forming? Is it a technical 
government aimed at leading the country to the elections quietly? Or is 
there further political life ahead of the government? The constitution 
does not compel the president to sack a government because of the new 
parliamentary elections and this or that party winning in them, does it? 
The floor is given to Shevtsova. 

  [Shevtsova] Stepashin has already been invited to run a government whose 
function is quite definite. This function is rather limited and that is 
to control [parliamentary] elections so that they will be won by forces 
loyal to Yeltsin. Another mission is to control the post-Yeltsin period 
in the interests of Yeltsin and the current ruling team. The third aim, 
and I cannot exclude this, is to put off the end of Yeltsin's presidency. 

  That is why Stepashin has a limited ground for his manouevring. 
Much depends on whether he will agree to the role of a puppet prime 
minister, a driving gear of a kind, or he will manage to eel his way out 
of the choking embrace of the presidential administration and some 
oligarchs. I think that we'd better not speak too soon. Stepashin may 
have a lot more of political will, stamina and possibly manouevring 
skills. It is not incidental that he has survived so long in the 
whirlpool of Russian politics for so long. He may have more of these 
fighting qualities than we supposed. I do not exclude that he may lead 
the govenment to a logical ending, to the presidential elections and will 
help organizes the elections. 

  [Presenter] Same question goes to Satarov. Do you think that Stepashin is 
there to stay or is he to last until the elections? 

  [Satarov] I think that both election will take place as planned. After that 
everything depends on Stepashin himself, on his ability to pass between 
the Scilla of the presidential team's influence and the Haribda of the 
Duma's lobbying. It depends on his consistency and independence. 

  [Presenter] [Omitted: presenter comparing the present-day government with 
that of former Russian Prime Minister Viktor Chernomyrdin's] 
 
  What will happen to Stepashin? Let us assume that he will stay as prime 
minister until December this year. Will he stay in his post afterwards? 

  [Radzikhovskiy] Stepashin's fate depends exclusively on the will and 
intentions of Yelsin and his immediate environment. Does Yeltsin intend to resign on 
12th June 2000 or not? If he does, is he ready to make Stepashin his 
successor? The latter depends on Stepashin's behaviour during this one 
year's test? 

  [Presenter] The same question - and this is the last question we are
debating - goes to Satarov. Georgiy Aleksandrovich, you know the president well, you 
used to be his aide for many years, you used to work with him. Knowing 
Yeltsin's nature... [pauses] Do you believe that Yeltsin will be sitting 
with his arms folded and will not come up with more surprises in the next 
weeks or months? 

  [Satarov] I will start by saying that there is a myth about Yeltsin the 
quarrelsome fellow. Well, he is not. He is a rather indecisive man. 
Normally, after he explodes, after he breaks a certain situation and 
wins, he calms down and is quiet. Recall 1991, for example. What happened 
after the coup's failure? Instead of pursuing the attack, Yeltsin went on 
holiday. The same is happeneing now. It is not incidental. If you wish, 
it is a psychophysiological law. It is his psychotype in essence. I do 
not think that we are to expect some other crises in the near future. 

  [Presenter] The same question goes to Shevtsova. 

  [Shevtsova] My colleagues have been talking about the psuchological
nature of Yeltsin's leadership and Yeltsin's acivities as a political leader. I 
would point out the structural trap or the structural conflict whose 
hostage our president is. This regime cannot develop normally at an even, 
stagnating momentum. In order to survive this regime needs constant 
shaking, constant crisis provoking situations. [Omitted: Shevtsova says 
that Yeltsin cannot have a strong successor, as he would receive control 
over post-Yeltsin period.]
 
  [Presenter] I would like to thank our experts, Shevtsova, Satarov and 
Radzikhovskiy.
Back to the top

#6
Christian Science Monitor
MAY 26, 1999 
OPINION
Rewarding Russia for what?
Loans from West flow in spite of political antagonism and corruption 
Frank Cilluffo and Todd Nelson 
Frank J. Cilluffo is a senior policy analyst and director of the Russian
organized crime task force at the Center for Strategic and International
Studies, in Washington, D.C. Todd Nelson is a research analyst for the task
force.

When the dust settles after the latest Russian political crisis - the
ouster of Prime Minister Yevgeni Primakov - the issue of International
Monetary Fund loans will once again become the focus in the Russian economy. 

While officials on both sides of the pond are uneasy - especially given the
slim chance the Duma will pass IMF-friendly legislation - they will,
eventually, come back to the table and are likely to agree to release the
next scheduled $4.5 billion loan disbursement. 

But there are compelling reasons for caution about international loans to
Russia. 

Repeated threats to withdraw from the peace-brokering process in Kosovo are
only the latest Russian measures aimed at frustrating Western foreign
policy. Russia has been an irritant to NATO at every stage of the crisis,
yet it howls in protest when it is ignored. 

Still, a new IMF loan disbursement to Russia is imminent and for a very bad
reason: to assuage Russian hurt feelings. If the IMF follows through, it
will make two grave mistakes: rewarding Russia's antagonism of the West,
and addressing political rather than economic considerations. 

The abysmal track record of Russian economic reform - inability to
implement a true market economy and lack of fiscal accountability and
transparency - doesn't justify further loans. 

Rationales advocating new loans to Russia have ranged from concerns about
Russia's alienation from the international community in case it defaults on
its foreign debt, to fears that Russia itself will collapse, resulting in
political chaos in a country that spans 11 time zones and still has 20,000
nuclear weapons. These scenarios, it is argued, would make Russia far more
dangerous than we perceive it to be now. 

The fact is that this has been tried before. 

Last summer, a $22.6 billion loan package put together by the IMF, World
Bank, and Japan at the urging of the Clinton administration was intended to
help stabilize the Russian economy. The justifications given at the time
were some of the exact concerns listed above. Within weeks the ruble
collapsed, and in the aftermath of the financial crisis, former Finance
Minister Anatoly Chubais admitted publicly that the loan package had been
"swindled" from the West. Adding injury to insult was the subsequent
discovery that most of the first $4.8 billion disbursement of the loan
package flowed right back out of the country again in a matter of weeks. 

The lion's share of the billions of dollars the international community has
loaned Russia since the breakup of the Soviet Union has fallen into the
pockets of corrupt bureaucrats and has primarily benefited those for whom
it was least intended. 

It is little wonder that these loans have failed to stop, or even to
postpone, the devaluation of the ruble and the crisis of the Russian economy. 

Until a measure of transparency and accountability has been achieved in the
Russian economy, the IMF might just as well deposit the money into Russian
offshore holding companies directly. For the IMF to loan money to Russia in
order for it to repay loans that it initially "swindled" from the IMF is
not only absurd, it's fiscally irresponsible and potentially dangerous. 

The fundamental issue is that aid money that has gone into Russia has
consistently and illegally increased the polarization of wealth in a
country where more than a third of the population lives below the
subsistence level. The pandemic corruption of the Russian state should have
caused IMF wariness and requirements of close scrutiny as to the final
destination of the loan money. 

It's impossible to divorce the economic quagmire in Russia from the
stranglehold crime and corruption have on Russian society. Solutions to
these problems are to be found in fostering a culture based on the rule of
law, a judiciary that is not cowed by political forces or police organs or
criminal syndicates. 

The best course of action for the West is not to throw money at Russians,
but to help them better help themselves by providing them with the tools
needed to improve their economy. 

Attracting foreign direct investment is the quickest path Russia can take
to recovery. This requires nurturing a more transparent business climate
that would subsequently generate investor confidence. Then not only would
Russia free itself from dependence on the IMF, but also nurture a truly
free and democratic market economy. 

Back to the top

#7
Sakhalin 'Mutiny' Rumors Said 'Exaggerated'  

Komsomolskaya Pravda
25 May 1999
[translation for presonal use only]
Report by Viktor Baranets and Sergey Prokopenko: "Drunken Soldiers 
Almost Seize Missile Unit" 

All Sakhalin is astir with the sensational rumor 
that mass disturbances took place on Cape Krilyon and a whole military 
unit belonging to the 11th Air Force and Air Defense Army stationed in 
the Far East was seized and held for almost 24 hours by drunken soldiers, 
that people were killed and injured.... 

Yesterday we contacted officials in the Main Military Prosecutor's Office and 
the Far East Military District Military Prosecutor's Office, and we even 
got through to Sakhalin. From them we learned that an extraordinary 
incident did indeed take place, but that the rumors about the scale of 
the event are exaggerated. In the words of Justice Lieutenant Colonel 
Grigoriy Kuleshov, deputy military prosecutor of Far East Military 
District (who went to the scene of the extraordinary incident), three 
people were injured. But no one was killed. 

According to the investigators' version, events developed as follows. On the 
third floor of the barracks of the Air Defense military unit stationed in 
Cape Krilyon a drinking bout was in full swing. Civilian employees of the 
Russian Army, who were renovating the premises, were drinking together 
with five soldiers, who were helping them with the refurbishment. 

Lieutenant Colonel Troot, deputy commander of a separate Air Defense 
radiotechnical company, having discovered at roll call the absence of 
several of his subordinates, went to look for them. Attracted by the 
noise, he ascended to the floor where the repairmen were working. A 
pretty lively scene presented itself to his view. The officer ordered his 
subordinates to report to their subunit. This was opposed by a workman 
named Rozhka (who has a previous conviction). He began to insult the 
officer, provoking a fight. A brawl broke out. Rozhda struck the officer 
on the head "with a heavy object, as yet unidentified." Several officers 
came to Troot's aid, and the workmen and soldiers started fighting them. 

Seeing that the numbers were unequal, one of the officers opened up the 
weapons storeroom, where his double-barreled hunting gun was kept, loaded 
it with grapeshot, and fired into the floor. Two of the drunken soldiers 
were slightly injured by the ricochet. This somewhat sobered up the 
hooligans. Nor has there been any confirmation of the version that the 
soldiers tried to storm the room where the weapons were kept or that that 
the unit was taken under the control of Internal Troops servicemen, 
allegedly called out to quell the "mutiny." It is known that a police 
detail summoned to the scene of the extraordinary incident arrested five 
drunken soldiers and civilian employees. 

Lieutenant Colonel Troot was the most seriously injured. The base of his 
skull 
was found to have been fractured. He was taken to military hospital in a 
serious condition. 

In the words of Colonel Aleksandr Romashkin, an official of the Main 
Military Prosecutor's Office, criminal proceedings have been instituted 
against the hooligans.
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#8
The Russia Journal

http://www.russiajournal.com
May 24-30, 1999

Moscow Must Address Role of Armed Forces in Possible Social Unrest

If Russia's current economic crisis turns into a social one, the Kremlin may 
not be able to control the situation with the forces at its disposal. This is 
why political and economic means must be found to resolve the situation.

Shortly before the failed impeachment vote of the president in the Duma lower 
house of parliament took place, several high-ranking officials paid a visit 
to the Federal Security Service's (FSB) Anti-Terrorist Center.

With the increasing threat of social and political destabilization in Russia, 
it is possible the visit was not just routine, but rather an indication of 
what the government believes may lie ahead. 

Defense Minister Igor Sergeev said the meeting was connected to political 
developments in the country and stressed that the armed forces would not be 
dragged into internal squabbles. 

"The aims and tasks of the armed forces are determined by the president and 
remain unchanged," Sergeev said. 

This last statement, however, suggests the army might still be used by the 
authorities for actions inside the country in case of civilian strife or 
social unrest. 

A presidential decree issued in November 1993 allows use of the army to 
suppress "illegal action by nationalistic, separatist and other forces aimed 
at destabilization in the country, the overthrow of the constitutional 
regime, etc."

Is it possible for such events to take place in Russia in the near future? 
Can Russia fall apart and plunge into civil war? 

Unfortunately, this is a possibility. The failure of the impeachment, the 
anti-Kremlin stance of the left-wing opposition, problems related to the 
formation of a new government, further aggravation in the North Caucasus and 
the ongoing economic crisis - all of these factors promote instability and 
tension.

Protest rallies that took place during the May holidays indicate that under 
the guidance of opposition parties and movements, a great number of people 
could rebel against the ruling regime.

Does Russia's political system have enough strength to effectively resist 
these destabilizing trends and forces? 

Lieutenant General Stanislav Kavun, deputy commander of the Interior Troops, 
told The Russia Journal that his force is able to enforce law and order in 
the country. 

Kavun says mobile units, which can be relocated anywhere in less than 24 
hours, have been formed within the Interior Troops this year. 

And, according to sources in general headquarters, a number of airborne units 
are maintained in permanent combat readiness.

But if massive civil disobedience breaks out simultaneously in several 
regions, Interior Minstry and airborne troops might not be able to 
effectively control the outbursts.

The former Soviet Union had some 400,000 Interior Ministry Troops, an 
airborne force nearly 100,000 men strong and a number of special divisions 
within the KGB.

And even these forces failed to prevent the bloody wars in Central Asia, 
Nagorny Karabakh, Abkhazia and Trans-Dniester that contributed to the 
collapse of the Soviet Union.

Officially, Russia has only 203,000 men in the Interior Ministry Troops and 
32,000 men in the Airborne Troops. Four out of a total of five rapid reaction 
divisions of the Interior Ministry troops are deployed in the North Caucasus. 

Russia is approximately 40 percent smaller in terms of area and population 
than the Soviet Union, but the numerical strength of forces designated to 
enforce law and order in the country has shrunk nearly 60 percent. Most of 
the remaining units are concentrated in European Russia.

Another destabilizing factor in the country stems from reform in the 
hierarchy of military structures. 

By the end of this year, military districts are to be converted into 
territorial army groups, subordinate entirely to their respective commanders.

This will increase the dependence of military units on governors and local 
business and political elite. 

Given the present unstable situation, there is the risk that an ambitious 
governor might develop a desire to take control of military units stationed 
in his domain.

In July 1998, Krasnoyarsk Territory governor Aleksandr Lebed threatened to 
"privatize" the Strategic Missile Corps Division deployed in his territory if 
the government did not pay delayed wages to the division's officers.

While the threat of social unrest becomes more unrealistic, no one has 
addressed the matter of the role armed forces are likely to plan.
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#9
Pravda
26 May 1999
"Military Reform"(rdubin@gwis2.circ.gwu.edu) 
rubric
The Fleet: Was it Sea-Going, or Will it Become Coastal?
by Colonel Vasily Izgarshev, Pravda's Military Observer
[translated by Rachel Dubin]

I do not know by hearsay what kind of Navy it was not too long ago.  In
the Northern Fleet, at the very end of our great [Soviet­trns.] Union, I
had a chance to visit on board the guided-missile cruiser "Marshal
Ustinov" and to acquaint myself with the military work of its excellent
crew.  I saw it in the business of the giant nuclear vessel's sailors
and submariners.  Of the boat itself, on board of which, to the surprise
of the press, there was besides intercontinental missiles, also a winter 
garden with singing
birds.  The ocean depths and motor speeds of submarine navigation are
dependent on the underwater nuclear vessel.  It is capable of going
round our Earth while underwater, without putting in and without coming
to the surface.  I was present at a state reception for the "Admiral of
the Fleet of the Soviet Union, Nikolai Kuznetsov," the first aircraft
carrier in the fleet.  And I spent almost a month in our Mediterranean
Squadron.  I walked on the cruiser "Zhdanov," on the large antisubmarine
ship "Krasnyy Krym" [Red Crimea­trns.]; we chased an American pirate,
the nuclear-powered aircraft carrier "Nimitz."  I am convinced that that
squadron would now be in the Mediterranean Sea, if there were not NATO
aggression in the Balkans.  The North Atlantic alliance would not have
decided on [committing­trns.] open robbery against a sovereign
Yugoslavia.

Yes, our Soviet Navy was powerful­the aircraft carriers, nuclear-powered
ships, submarines and ocean-going carriers.  And on the sea lanes, the
world met the ships under the flag of the Land of the Soviets with
respect .  Indeed, besides purely military and defensive tasks, the Navy
successfully solved diplomatic problems.  It appropriately represented
our great country­its culture and traditions­in many foreign countries.

10-15 years ago, the ships of the Soviet Navy carried out ten naval
journeys with visits of friendship and peace.

Where is all this now?  Last year, there were a total of two journeys
flying the Russian flag.  The sailors maintain that such journeys are
planned for this, too.  But this is only a part of what once was.

And in general, the Russian Navy is surviving not far from better times,
like the country as a whole.  However, this has been said lightly.  The
sea-going Navy has significantly reduced the amount of its pennants, and
so it will become coastal.  There are no monies, no financing, no fuel,
and no lubricants.  There is not even paint in order to refresh a deck
and a superstructure.

The West Atlantic people, who constantly track the state of affairs of
the Russian Armed Forces, including the Navy, maintain that we have in
operation a total of 27 combat-ready nuclear submarines that are armed
with ballistic missiles.  If the present material problems remain, the
number of nuclear vessels will be reduced by double after five years.
It will be too bad with the missiles for the submarines, but it will be
even worse in the future.

The Naval Command does not dispute either present estimates or future
predictions.  However, as possible as it is to dispute the fact that it
arises directly from the situation, "in the process of disbanding the
Armed Forces of the Russian Federation in the 1991-96 period,
quantitative and qualitative changes in the needs in weapons and
military technology took place, which led to a fall in the annual
amounts of state defense orders and to an existing reduction in military
production."  This is an old citation.  I extracted it from a letter
last January by deputy chairman of the RF Yakov Urinson, of sad memory,
who had addressed the chairman of the State Duma.

But if military reform is announced in Russia, then it, naturally, and
with a reduction in the amount of servicemen, must be accompanied by a
forced technological retrofitting of the army and navy.  Yes, a number
of nuclear-powered ships can, and need to be, reduced.  But their
qualitative parameters and their military capability must certainly
increase.  Here, they want to accomplish a small retreat concerning
reforms.  The thing is that it has only led to a reduction of
personnel.  More than three million personnel were in the Armed Forces;
it has been decided to bring the number to 1.5 million.  The task for
the Ministry of Defense has been laid out.

According to the survivors, those who were needed and not needed were
cut and dismissed and divisions and regiments were reduced .  But the
thing was done.  The army was reduced by a third.  However, no one
calculated how many defense industries needed to be reduced or how many
guns, heavy military technology, and so forth, were to be produced.
None of us studied it.  Defense has fallen on its side.  The
professionals have made an escape from industry.  The old men who are
left therefore vegetate without wages, as defense orders per se do not
exist in nature.  The previous Primakov-Maslyukov government tried to
rejuvenate the military-industrial complex.  Something was done, but the
government was not allowed to turn it around.  It is not known what will
happen now.  In any case, nothing will as long as Stepashin is the one
in government who is responsible for the military-industrial complex.

Meanwhile. Goszakaz [State Ordering Commission­trns.] is unchangingly
reducing scientific-research and defense-construction work upon the
deliveries of modernized military technology and weapons.  I understand
that the number does not always adorn newspaper publications, but we
cannot do without it.  So, the government's outlay for Goszakaz before
industries was (in old prices) 7 billion rubles in 1992; 920 billion in
1993; 4.2 trillion in 1997; 7.7 trillion in 1995; and 15.6 trillion in
1996.  It did not decrease in 1997 and 1998.  So, how does it decrease
if the entire budget of the country during the reforms has been reduced
tenfold?  Las year's budget was a total of 10.2% of the 1990 RSFSR
budget.  And today's budget, it is shameful to say, is less than New
York's yearly budget.

So, the nuclear-powered cruiser "Pyotr Velikiy" did not accidentally
stand on the ways at the shipyard's berthing walls for over 10 years.
It is not accidental, either, that for the past [couple of­trns.] years,
the submarine fleet has not been replenished by a single nuclear-powered
vessel.  Is it somewhere, the submarine "Yuri Dolgorukiy," which was
featured in the press and called the nuclear vessel of the 21st
century?  For sure, are we going to wait for it in the 21st century?

So what kind of navy does Russia need now?  Ocean-going or coastal?
What a question!  Of course, ocean-going, capable of ensuring the
country's stated interests on the planet's seas and oceans and the
integrity and security of its extensive maritime boundaries.

Of course, the Navy today is not what we had in the Soviet Union.
Today, 75% of ships and 10-15 years' worth of servicemen make up the
Navy's combat-ready personnel.  But there is a basis for the Navy's
future development.  Naval sailors consider this foundation to be
entirely sufficient.

And what of military reform?  It perhaps works in the Navy not as it
should, but the naval sailors are not guilty of it.  Here, everything
also rests on financing. Yet, according to the organized establishment's
plan of measures, everything is being carried out without the usual
delay.  Not all is smooth with the financing here, but the sailors, not
hoping for money from above, have learned to make the best use of the
internal resources they have.  In short, in the Navy, in contrast to the
Army, only a monthly lag in payment of wages has been procured.  (True,
sailors do not have it better with other wages than soldiers.)

Much has already been done about reforming the system of management.  It
is subject to reformation to a large extent.  The Navy has gone through
two to three-layer systems of management.  Until now, it was four to
five layers.  A year ago, as counted in Glavkomat, [Commander in Chief's
office­trns.] 197 managers were above the ship's commanders­this was
taken on account of the commanders of a small antisubmarine commander.
But the ship is not painted; the sailors are undressed and unshod.

It was reported not long ago that the sailors on the heavy missile
cruiser "Varyag" (Pacific Fleet) were fed twice a day.  And if one
reduces the [number of­trns.] managers and hands their money over to the
ship?  Both paint, products for the galley, boots, and uniforms will be
found.

If one takes into account that the Navy's military personnel has been
reduced by two and a half, then, by itself, a conclusion can be drawn:
it is necessary to change the system of management and to reduce it in
correspondence with the powers and parts of the navy's military
personnel.

Much has been done about this in relation to the Baltic Fleet, where not
long ago the present Chief Commander of the Navy, Admiral Vladimir
Kuroedov headed the crew.  I followed attentively as this Naval
Commander, outstanding and distinguished by his co-servicemen's
opinions, served in the Baltics and the Pacific Ocean with proximity to
the sailors and officers and what sort of order he established in the
Main Directorate, being its boss, and read all his publications and
published interviews.  I like the admiral's reasoned, businesslike
approach to reforming the Navy.  Everything is done without rushing but
well, with an eye to the future.  A radical modernization started in the
Baltic Fleet in 1993.  A new structure, including the Moscow-Minsk,
Proletarskii Motorized Divisions and other army troops, as well as parts
of the Air Force and Air Defense that are dislocated in the Kaliningrad
enclave, has already been tested and acts as a powerful
operative-strategic grouping.

A single grouping of two unions on a base and in Kamchatka have been
created.  The system of command there is different than the Baltics.
But the scales are different there.  The Great, or Pacific, Ocean, is
not a shallow Baltic water.

But the reform of other Pacific Ocean Fleet associations is next.

But not only  are ships being reduced; naval academies are [also­trns.]
being reduced.  Reform connected with a staff reduction is a most
complex and difficult process.  Indeed, we are talking about people.
Many established posts are being reduced by almost forty thousand.  The
new numerical composition of the Navy does not require 12 thousand
lieutenants, but just so much as the naval higher institutions have put
out up till now.  Is this a way out?  It is not difficult, however, but
a number of naval schools have been required to be reduced.  At a
complex of naval schools in St. Petersburg, two naval institutes were
created.  They are uniting the faculties and departments that prepare
officers of analogous specialties.

Under a plan of command, the training of personnel for the Navy has
included in a single orderly system both the academy, the institute, and
officer schools, as well as the Nakhimovskiy naval school and the cadet
corps of future naval sailors.

However, I cannot help but talk about money again.  When will we, all
the same, not grow rich, but live normally so as to stretch our clothes
to our feet?  How it will get on our nerves to beg and watch every penny
so as not only to reform ourselves, but also feed, water, dress, and
shoe soldiers and sailors and pay salaries to officers.

And as regards the question in the headline, it is confirmed: we are
Russians, we are sea-going; we are not letting go of our shore, and we
will again go out on the ocean expanses.  So it will be.
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