June 24, 1998   
This Date's Issues: 2236• 2237 • 

Johnson's Russia List
#2237
24 June 1998
davidjohnson@erols.com

[Note from David Johnson:
VACATION: I and JRL will be on vacation next week. The last JRL
will be June 27. Plan to resume on or about July 5. I'll be near
Charlottesville, Virginia.
1. AP: Russia Presents Plan to IMF.
2. Reuters: Yeltsin speech on Russia anti-crisis programme.
3. Interfax: Yabloko Movement To Support Russian Government's Program.
4. Interfax: Noted Russian Economist: Govt Will Have To Devalue Ruble.
(Illarionov).
5. Jim Vail: Laura Belin's reponse to Helmer article.
6. John Varoli: Some Comments on Russia.
7. Christian Science Monitor: Judith Matloff, Old Roots Trip Russia's Farms.
Land is last bastion of deep Russian misgivings over property.
8. Journal of Commerce: Aaron Lukas, Trading with the bear.
9. Pravda: Leaders Cited After Petersburg Economic Forum.
10. Itar-Tass: Zyuganov: 'Revolutionary Rise Has Begun in Russia.'
11. John Tedstrom: RAND job.
12. Ken Duckworth: Re Williamson /Biological Weapons- JRL #2235.
13. RFE/RL: Potanin Moves Past Berezovsky on Forbes List.
14. AP: Mitchell Landsberg, Russian Show Glorifies Tax Police.]

********

#1
Russia Presents Plan to IMF 
By Maura Reynolds
June 24, 1998

MOSCOW (AP) -- Premier Sergei Kiriyenko submitted his new austerity plan to
the International Monetary Fund today in the hope it would earn Russia
enough new lending to finance an economic recovery. 
The IMF's first deputy managing director, Stanley Fischer, told The
Associated Press that fund analysts will need several weeks to study the
plan. 
``We have read the headlines, we've read the speeches, we got
descriptions of the measures,'' he said as he prepared to depart the
country. ``Precisely what they will amount to in terms of the budget we
will have to discuss.'' 
However, Fischer said that in the meantime he will recommend that the
fund release the latest, $670 million installment of an existing loan that
was held up last week to press Russia to meet the IMF's criteria. 
Kiriyenko detailed his austerity plan to the Cabinet and parliament on
Tuesday. The measures are designed to do largely what the IMF has demanded
and Russia has resisted: cut government spending, boost tax collections,
and tighten control over customs and tax authorities. 
Russia has been taking such measures already, but the IMF has said the
cuts did not go deep enough, and tax collections have failed to raise
government revenues enough. The international lender has insisted that the
country do more or it will not qualify for a new loan. Russia has said it
needed between $10 and $15 billion. 
Fischer told the AP that in his view, Russia's chronic tax collection
problem is the biggest obstacle to a new loan. He said that the country's
biggest companies, especially oil companies, are the greatest tax evaders. 
But Russia will have to do more than just crack down on large firms. It
will also have to force average Russians to become taxpayers. 
The country has no tax-paying tradition, and officials have said that
fewer than 5 million of the country's 147 million residents filed income
tax forms last year. 
``People, companies, should pay the taxes that the law says they should
pay,'' Fischer said. ``This is the habit in most countries.'' 

Kiriyenko has said the IMF loan is needed to replenish the Central
Bank's reserves, to back up Russian bonds and prevent a run on the national
currency, the ruble. The Kremlin fears that devaluation of the ruble could
lead to higher consumer prices and social unrest. 
Russia's economy has been troubled since the beginning of the year, when
it began losing ground after posting its first growth of the post-Soviet
period last year. Stocks have collapsed to about half their value. 
Kiriyenko's austerity measures were greeted with mixed reactions in the
Russian media. Many analysts accepted that austerity measures are needed,
but expressed reservations about the government's ability to carry them out
fairly and effectively. 
Parts of the program -- big cuts in the government work force, a
revamped tax code -- are certain to run into strong resistance in the Duma,
the Communist-dominated lower house of parliament. 
Kiriyenko has asked parliament to pass the necessary legislation to
implement the plan before it recesses on July 3 for more than two months.
But even pro-government deputies say the legislature was unlikely to act
with such dispatch. 
********

#2
Yeltsin speech on Russia anti-crisis programme

MOSCOW, June 23 (Reuters) - Following is the text of Russian President Boris
Yeltsin's speech at the opening of a joint government and parliament session
at which the government presented its anti-crisis proposals: 

``Dear members of the government and parliament. 

The joint meeting is caused by extraordinary circumstances. In many
countries
the world financial crisis has led to a serious reconsideration of the role
and place of the state in the modern-day economy. 
It is also acute for Russia, which is carrying out a most difficult transfer
to a regulated market. Despite urgent government measures the situation in the
financial sphere is alarming. 
Radical measures, measures adequate to the seriousness of the situation, are
required to bring back order to the economy. 
The economic crisis has become so acute that there are social and political
dangers. Those who care for Russia -- not in words but in deeds -- have to
understand this. 
The price of delays, fussing and fighting is too high today. 
(Prime Minister) Sergei Vladilenovich Kiriyenko will present to you a
programme of economic and financial stabilisation. 
It has two aims: 
First of all to quell turmoil on financial markets, and second, in a longer
run, to create a strong economy protected from similar situations in the
future. 
The measures written in the programme are not revolutionary. 
We have been talking about their necessity for years. Actually they appeared
in every presidential address to the parliament. 
But there is no actual change that the society would be able to feel. 
Naturally, Russia has been seriously hit by the fever on world markets,
by the
financial crisis in southeast Asia and, of course, by a collapse of world oil
prices. As a result the budget lost tens of billions of roubles (billions of
dollars). 
But a great deal of the fault lies with us. We have lost momentum in
reforming

the economy. The situation with payments of wages, pensions, welfare has
deteriorated again. 
Not only the public sector workers are suffering, not only those working in
the defence industry. Those who are not paid from the budget are suffering as
well. 
You know, I am not prone to over-dramatise the situation but acute
tensions in
the Russian society are all too clear. 
Our economic policy requires serious corrections. 
The proposed programme is not just designed to introduce elementary
financial
order but also to change the economic situation in Russia radically. 
Enough of living beyond one's means, when one-third of budget revenues are
dumped to cover domestic and foreign debts. Enough of babbling about the need
to revitalise domestic industry. 
Yes, Russian goods must become the masters on the Russian market. But in
fact
the support of domestic producers is often substituted by lobbying of
ineffective production. 
Enough of being proud of pseudo economic independence of the regions. We are
all in one boat, but some are really rowing while the others simply sit there
doing nothing. They borrow a lot only to make the federal centre deal with
their debts later. 
We cannot tolerate more indecisiveness and sluggishness in carrying out
decisions. 
The programme of the government must become a programme of action, it must
give answers to vitally important questions. It must revitalise Russia's
industry and support the producers, create a tax system comprehensible to all,
when fairly paying taxes will be profitable. 
In this way the government plans to help the poorest segments of the
population. 
It will be difficult to fulfil this programme, but we have no alternative. 
Many participants of the meeting had little time to study the whole
package of
documents, many received it only this morning. 
But it comprises practically all the business-like proposals that
parliamentarians had come up with during their meetings with the head of the
government. 
Significant additions that will sound today must also find a reflection
in the
programme. 
Dear members of the government and parliament, all these laws have to be
approved before the start of the summer break. This is the deadline, there is
no other. 
I understand your attitudes, but I want to say again that we have no
other way
and if the package of laws written in the programme is not approved, other
measures will be taken. 
But I still count on your constructive approach. As before, I put my
stakes on
a dialogue. There is no time for settlement of differences. 
All those who really care for the country's fate have to leave aside their
private interests or addictions to political parties, regional elite, trade
unions or business interests. Everybody needs unity when we are talking
national interests. 
And this moment of our history requires this unity.'' 

********

#3
Yabloko Movement To Support Russian Government's Program 

MOSCOW, June 24 (Interfax) - Russia's reformist Yabloko party and its
parliamentary faction have decided to support all measures prepared by the
Russian government to stabilize the financial and economic situation in the
country, Yabloko leader Grigory Yavlinsky told a news conference at
Interfax Wednesday. 
Yabloko in particular supports all measures pertaining to improvement of
the tax system, reduction of the tax burden, stiffening of controls over
collection of taxes and customs policy, he said. 

Yabloko has already begun to study the government's detailed program
and will do its best to support the measures after the documents have been
submitted to the Duma, Yavlinsky said. 
Yabloko believes that "if at least a part of the government's proposals
are implemented, the financial crisis will slow down somewhat and this will
allow the Cabinet to face this fall with more confidence," he said. 
If within the next two months the government raises collection of taxes
by 1.5-2% against current levels, this will be proof that the Cabinet "is
able to control the situation," Yavlinsky said. 
The government's program and a possible foreign loan are "largely an
anaesthetic," he said. "The credit the government may receive is more like
a pill relieving a sufferer from toothache for some time. One can take the
pill but the pain will resume in several hours," Yavlinsky said. 
Russia will not be able to break free from the present "vicious
circle... without a serious economic review of the causes of the crisis,
without changes to the concept for economic development or without
understanding that a pipeline economy based on oil and gas" is impractical,
he said. 
Yavlinsky also urged dismantling "the corporate, semi-criminal and
oligarchic foundation of our economic system." 

********

#4
Noted Russian Economist: Govt Will Have To Devalue Ruble 

MOSCOW, June 24 (Interfax) - Russia's current policy makes devaluation of
the ruble inevitable, Director of the Economic Analysis Institute Andrei
Illarionov told a news conference at Interfax Wednesday. 
Russian budgets of recent years, including that on the 1998 budget, have
been unrealistic, Illarionov said. The budget deficit remains and state
debt is growing, leading in turn to greater spending on interest, he said. 
Given such a soft budget policy, the Cabinet and the Central Bank are
continuing to maintain a tight currency corridor, which inevitably
decreases the Central Bank's foreign reserves, Illarionov said. 
The ruble's devaluation is becoming inevitable, he said. Comparisons
with other countries made by experts in the Economic Analysis Institute
show that the ruble could be devalued by 50%, he said. 
Analysts also determined that the Russian ruble's exchange rate has been
kept artificially high since the fall of world oil prices in
October-November 1997, Illarionov said. 
The government's actions and the economic situation in Russia make a
debt crisis inevitable, he said. 
The government's maneuver to move financing of the budget deficit from
domestic to foreign sources will allow the country to avoid an internal
debt crisis in the short run, but greatly increases the burden of foreign
borrowing, Illarionov said. Russia's foreign debt will rise from 26.4% of
GDP in May 1998 to 45.5% of GDP by 2000 if trends continue, he added. 
The inevitable foreign debt crisis will be far more difficult and
lengthy than the crisis spawned by the domestic debt, Illarionov said. 

********

#5
From: JIM_VAIL@eu.bm.com (Jim Vail)
Date: Wed, 24 Jun 1998 
Subject: Laura Belin's reponse to Helmer article


Concerning Radio Free Europe's Laura Belin's reply to John Helmer's 
article on the World Bank study and the wonderful follow up response 
by Robert McIntyre, I would like to add one more note.

Laura Belin also likes to criticize The Moscow Times columnist Yulia 
Latyina who also writes for Ekspert. She states that many of her 
pieces are pro-Uneximbank, the bank which owns the business magazine 
Ekspert. It's one thing to criticize newspaper reporters who 
blantantly print the propoganda of their owners. However, one should 
also judge the work itself. Latyina is a fine journalist who does very 
insightful reporting on the state of the Russian economy, while 
Ekspert happens to be one of the best business publications in Russia 
today.

At the Freedom Forum in Russia a couple of weeks ago, one participant 
asked Allen Neuharth, the founder of the Freedom Forum which promotes 
free and fair speech all over the world, if he knew of any American 
journalists who conducted good investigative reporting into the 
affairs of their owners. His answer was no.

While I wouldn't disagree with the fact that the Russian media moguls 
have bought up everything and use their publications to promote what 
they want, let's not go overboard and slam Russia's excellent 
journalists who happened to be employed by them.

*********

#6
Date: Wed, 24 Jun 1998 
From: "John Varoli" <varoli@mail.nevalink.ru>
Subject: Some Comments

Paul Gobel's piece in JRL #2235, "Avoiding The Apocalypse" was
quite good and long overdue. While he does not single out Russia as an
example, I think we all know that apocalyptic thinking is unfortunately
too prevalent in discussions on Russia (and has for centuries). This in
turn has severely handicapped our understanding of the situation in the
country. 

During a recent trip to the USA, I was shocked by how many people actually
believe that Russia totters on the edge of the abyss. A lot of it has to do
with the poor way in which the mass media gathers and presents information
about Russia, as well as difficulties people have overcoming their
prejudices toward the country and interpreting that information.

In February's issue of Transitions Magazine, St. Petersburg sociologist
Viktor Voronkov has a fine article analyzing this apocalyptic
mindset in regards to Russia. I highly recommend it to your readers.

I have lived in Russia and been studying life in the country since the
middle of 1992, and I can say with certainty that the worse is behind us.
In 1992-93, the threat of famine,
a nationalist backlash, civil war and/or mass civil disorder was real.

In the past few years, despite the fact that some segments of the
population have been losing out, the material well-being of most has
improved. We all know that the official statistics do not tell even half
the story, and that the shadow economy is allowing some to thrive and
others to make end meet.
As one who worked with the poor here for three years as a relief worker, I
know only too well how hard things are still for many. But

while some argue that the prosperity of Moscow is a poor indicator of
progress throughout Russia, well so the poverty in Kemerovo and the Far
North are not representative of the whole country.

Now, there is enough food, unlike the early 1990s. Also, many people,
primarily those in urban areas, have the disposal income to purchase
various consumer
goods that were unthinkable four years ago. Car ownership, for example, has
more than doubled in the past five years to cover about
20 percent of the population. And Voronkov says that Russians occupy 8th
place in the world for most money spent while traveling abroad. This is
not just due to the large sums spent by New Russians. Many average-income
Russians are traveling abroad.

Concerning the threats of a nationalist backlash or mass civil disorder....
certainly there is a sizable minority of people, probably about
one-third of the population, who have shown constant support for extreme
nationalist candidates,
ranging from Zyuganov to Anpilov, throughout the 1990s. (I am still not
convinced that it is
fair to label Lebed as such because he seems to be more reasonable than the
radicals, and perhaps he can create the order that the country needs.
Though I would not mind hearing someone argue that I am mistaken.)

Most Russians are reasonable, intelligent, as well as passive and
apolitical by nature, and will not support a nationalist candidate. When
dismal poverty and hopelessness afflicted nearly all Russians in October
1993, they did not support the extremists who attempted a coup d'etat. And
they will certainly not do so now when there are more opportunities to earn
money, and people are living better.

Unfortunately, many see the Day of Protest, and the fact
that according to VTsIOM, one fifth of Russians are not paid on time, as
providing the basis for revolt. But that is not true as witnessed by the
small turnouts for demonstrations and their passive nature. Not to mention
that the radical leaders understand very well that the MVD is more than
capable to deal with any disturbances, and therefore are careful to refrain
from violence.

Another factor preventing a nationalist backlash is the oligarchy. They
created the last president, and they will create the next. As far as I
can see they have no interest in a nationalist coming to power. If by
some chance they do, however, then we should start worrying.

Perhaps you are asking yourself why so many Russians complain that
life is worse, as testified to many opinion polls. Well, the answer is
simple. The Russian national character is characterized by exceptional
pessimistic tendencies and the inclination to complain. Opinion polls in
Russia often do not give us a good indication of the actual situation.

Even people who live well above the national average, complain incessantly.
I think that all of
us who live here have stories about Russians who, for example, first
complain how bad they live, and then only seconds later talk about their
recent several hundred dollar purchase or some trip abroad. 
But, while material conditions have improved, psychologically speaking,
Russians are indeed worse off. During Soviet times, they lived in a society

that was for the most part stress free--- as long as you did not think too
hard and start to doubt the existing regime. 

Now, Russians have to live in the real world, where there are real
problems which must be solved by oneself; not to mention that there is a
loss of national pride as the country has lost its super-power status and
it has been revealed that everything Russian is not the best in the world. 
But this wounded pride is not one of the leading
sentiments among most Russians, and should not be exaggerated. It is not a
factor that a dangerous populist-nationalist leader will be able to tap
into in order to come to power. Feelings of national
embarassment are mid-way down on the list of
gripes. Most Russians are not patriotic at the current moment. 

And while the changes in Russia have wrought great psychological pain, many
are adjusting to new realities because they are learning that it is in the
best interest to do so.

True, others are not adapting, and perhaps are too old to adapt. Besides
the elderly, hundreds of alcoholics,
homeless, drug addicts, prostitutes, street kids, and etc, have cried on
my shoulder. Despite my personal sympathy for these people and the wish
for justice, objectively, I think that Russia must go through this harsh
phase. Russians must emerge from that infantile Soviet social structure
where Big Brother took care of everything, and take responsibility for
their lives and society. Only this way will they be able to build a
truly civil and democratic society.

The government's main task should be to make the process quicker,
create even more opportunity for people to have an even better life,
and to provide relief for those who have trouble adapting to a society
based on individual initiative and responsibility.

Regards,
John Varoli
correspondent
St. Petersburg Times and Bloomberg News

*********

#7
Christian Science Monitor
JUNE 24, 1998 
[for personal use only]
Old Roots Trip Russia's Farms
Land is last bastion of deep Russian misgivings over property
By Judith Matloff 

KRYOKSHINO, RUSSIA 

The collective farm here used to be known for its plump strawberries and 
cattle, which graced the tables of the Soviet elite. Its abundant honey 
and apples were sought after in Moscow a half-hour drive away.

These days, the fruit fields are choked with dandelion weeds. Pigs are 
dwindling because they serve as payment to workers in lieu of overdue 
wages. Orchards have been cut down to build villas for three rich pop 
stars.

"It's not profitable to produce anymore," says farm director Nikolai 
Ovcharenko. "We're slowly dying."

He holds out a worn ledger cataloging 10 years of decline. With a 
grimace, he points to a drop in cattle from 900 head to 350 and a 
520-member work force cut to 170.

The Kyokshino farm is symbolic of the decay in Russian agriculture. And 
it is the last thing the country needs as it experiences a financial 
crisis.

The Soviet Union may have collapsed seven years ago, but the reforms 
that swept banks and businesses missed agriculture. The Communist 
opposition has blocked ambitious plans for private ownership of 
farmland. And even farmers with entrepreneurial streaks find credit hard 


to come by, what with 60 percent interest rates and no collateral, since 
they don't own the land.

The result is that most collective farms, or kolkhoz - half of Russia's 
50,000 farms - set up under the Soviets continue as they have for six 
decades, despite much-heralded plans to restructure them.

Subsidies have dried up, and they are unable to compete in the new 
market economy. Equipment is grossly outdated, with the Agriculture 
Ministry estimating that half of the tractors are not working.

Russia imports one-fourth of its food. An estimated 80 percent of farms 
are in the red - and most peasants feed themselves with small 
subsistence plots.

With a severe financial crisis looming across Russia, Western economists 
say it is imperative that the government begin to manage its farms 
better and raise revenue by selling off land.

"The lack of private ownership severely hampers an efficient 
agricultural system," says Chris Williams, agricultural program manager 
for the International Finance Corp., the private lending arm of the 
World Bank.

Clash over privatization 

President Boris Yeltsin heads the advocates of private land ownership, 
who argue that tax revenues and land sales would offset the troubling 
state deficit, which is more than 5 percent of gross domestic product. 
Farmers would manage farms better when faced with competition, they say.

Indeed, the US-based Rural Development Institute estimates that billions 
of dollars are lost by not selling off state lands.

"The difficulties in agriculture today are due to great extent to wrong 
state policies" in the past, said the new agricultural minister, Viktor 
Semyonov, in a recent newspaper interview.

But resistance is strong from the Communists, for whom land has been an 
emotional and ideologically loaded issue since even before the 1917 
Bolshevik Revolution.

Since the Soviet Union's collapse in 1991, Russians can own land in 
urban areas. But no mechanisms exist for transferring agricultural land 
ownership, although in theory anyone can buy land.

On May 20, the upper house of parliament approved a draft land bill that 
prohibits many forms of land sales, including inheritance and grants. 
President Yeltsin's aides say he will veto it.

Under Stalin in the 1930s, countless thousands of people were forced to 
relocate to collective farms and were told what and how much to produce. 
The kolkhoz became synonymous with horrendous inefficiency. Farm bosses 
falsified production figures and treated workers as little more than 
serfs.

The kolkhoz never could entirely feed the population, so peasants 
survived by tilling their own gardens. Even today, some 50 percent of 
farms are self-sufficiency plots that exchange goods by barter.

Despite whatever suffering they have undergone over the ages, many small 
farmers are psychologically unprepared to buy or run their own farms, 
argues Yuri Chernichenko, leader of the Peasants' Party, which for years 
has sought to mobilize peasants politically.

"People are used to being told what to do. So they are scared to take 
the risk to deal with the banks, taxes, and decisionmaking," Mr. 

Chernichenko says.

There is another problem: the difficulty of getting credit. With 
interest rates at 60 percent, only the rich can afford to buy land - and 
operate farms. And the law now precludes using land as collateral for 
loans.
This gives fuel to the argument by the Communist-dominated Duma, or 
lower house of parliament, that says the chief beneficiaries of land 
auctions would be wealthy land grabbers.

Seeking banks' help

Financial aid is the main issue, not land ownership, say farmer 
activists. They say disparities between the high costs of fuel and low 
prices for produce make farming unprofitable. And they want banks to 
give credits at low interest rates.

"Farmers are unable to increase production without profits. Everything 
depends on state support for farmers," says Nikolai Kharitonov, chairman 
of the agrarian faction at the Duma. He and others agree that something 
will have to be done about the $20 billion debt to the state owed by the 
agrarian sector.
But what to do is a matter of debate that so far seems unlikely to be 
resolved.
In the meantime, Yeltsin has decreed that local authorities in the 89 
Russian regions can make their own land laws.
The first one has done that: Saratov, on the banks of the Volga River, 
has had mixed results.

*******
#8
Journal of Commerce
24 June 1998
[for personal use only]
Guest Opinion
Trading with the bear
BY AARON LUKAS
Aaron Lukas is an analyst at the Cato Institute's Center for Trade 
Policy Studies. 

The Russian bear isn't looking very healthy these days. The country's 
stock market has tanked while interest rates have soared -- up to 150% 
at one point. For the moment, the Russian economy appears to have 
stabilized, but its underlying troubles have hardly disappeared.

In response, Western officials and big investors have focused their 
attention on channeling more money to Russia through the International 
Monetary Fund. Any new assistance would be on top of a $9.2 billion aid 
package that is already in the works.

But while Washington contemplates lending billions of dollars more to 
the Russian government, it continues to maintain pervasive trade 
barriers that prevent significant increases in Russian exports to the 
United States. President Clinton publicly proclaims the U.S. desire to 
help Russia, but those trade barriers are stifling the chances of its 
150 million citizens to build better lives.

Ironically, the Russian economy might today be stronger if the Clinton 
administration had followed its own advice. In a 1995 speech, for 
example, Vice-President Al Gore said that "President Clinton and the 
supporters of Russian reform in Congress have long maintained that it 
would be trade, not aid, that would be the ultimate guarantor of 
economic growth in the former Soviet Union."

He further declared that "The door is open for Russia to build a 
vibrant, mutually advantageous trade and investment relationship with 
the United States and the other market democracies."

In reality, that door was never fully open. Washington has always 
imposed curbs such as high tariffs and quotas on a range of Russian 
goods. Those barriers cost Russia $700 million in desperately needed 

sales each year, according to Russian Deputy Minister for Foreign 
Economic Relations and Trade Roald Piskoppel.

Of particular concern is the U.S. use of anti-dumping penalties. Russia
's losses from those measures alone amount to $150 million per year, Mr. 
Piskoppel reported. That's hardly surprising, considering the United 
States has used them to block Russian imports -- from pure magnesium to 
sponge titanium -- at every turn.

Even when anti-dumping penalties aren't imposed, Russia loses. In 
September, for example, the Department of Commerce agreed to suspend its 
anti-dumping investigation on imports of carbon steel plate. Instead, 
"voluntary" quotas and price floors were imposed. That's good news for 
anti-dumping dependents like Geneva Steel and Gulf States Steel: they 
reap gains from protection at the expense of Russian manufacturers, U.S. 
consumers and downstream producers. According to those companies, 
Americans industries shouldn't be allowed to buy steel at the best 
available price.
Now Americans may be forced to pay again -- this time with their tax 
dollars -- if new IMF funding is approved. Indeed, officials are already 
citing Russia's troubles as evidence that an additional $18 billion of 
U.S. funds is needed to shore up IMF reserves.

Russian officials are understandably frustrated by Western hypocrisy. 
Dmitriy Sukhoparov of the Ministry for Foreign Economic Relations summed 
up their sentiments, saying, "In response to an almost complete opening 
of its market in 1992, Russia by 1998 got a sixfold increase in trade 
barriers" to its exports.

It's time for the United States to bring trade policy towards Russia in 
line with general foreign policy goals. The first step should be to 
change Russia's "non-market economy" classification. Dumping margins for 
non-market economies are calculated using a hopelessly biased process 
that often results in astronomically high penalties. The European Union 
has already re-classified Russia; Washington should do the same.

That change alone, though, is not sufficient. The anti-dumping law needs 
reform across the board. Its biased policies penalize as "unfair" 
business practices that are perfectly legal when engaged in by American 
businesses. Until such discrimination against imports is ended, 
exporters in Russia and elsewhere will continue to be vulnerable to 
exclusion from the U.S. market.

So far, Russia hasn't approached the leading industrial nations for 
bilateral aid to help relieve financial market strains. "The only 
support Russia needs is that of free and fair competition," declared 
Prime Minister Sergei Kiriyenko recently. "We don't need any other aid." 
Even some IMF officials say that Russia stands a good chance of riding 
out its troubles without an aid package.

Mr. Kiriyenko is right. In the long term, what Russia needs isn't 
continued reliance on foreign loans and aid, but simply the opportunity 
to trade. 

*********

#9
Leaders Cited After Petersburg Forum 

Pravda
20 June 1998
[translation for personal use only]
Feature by Yuriy Kukanov comprising "exclusive" interviews
with Russian Federation Council Chairman Yegor Stroyev, Russian


Prime Minister Sergey Kiriyenko, and Belarusian President
Alyaksandr Lukashenka in St. Petersburg; date not given: "We Must
Get Out of Crisis Together -- first two paragraphs are
introduction; passages within slantlines published in boldface

St. Petersburg -- Yegor Stroyev, Sergey Kiriyenko, and Alyaksandr
Lukashenka gave exclusive interviews to Pravda at the end of the second
Petersburg economic forum, which has already been dubbed the "Russian
Davos" because it brings together a significant proportion of the
political, financial and banking, entrepreneurial, and scientific elite of
the countries located on the former USSR's territory.
Few of the forum participants would dispute the opinion that it is
still more convenient to get out of the crisis together. But they were
expecting to hear specific remedies primarily from Moscow. A rough draft of
the anticrisis program running to 67 pages was already being passed around
in the Tauride Palace lobbies. The theses articulated by Prime Minister
Sergey Kiriyenko did not satisfy many people with their declarativeness and
lack of specifics. But no united opinion on the document, which is due to
be submitted 23 June to an enlarged Cabinet of Ministers session, was
formed among the opposition. While State Duma Deputy Chairman Sergey
Baburin, leader of the Russian National Union, talks about the government's
attempts to stabilize the socioeconomic situation in the country, Gennadiy
Seleznev, speaker of the lower chamber of parliament, cannot discern any
concept at all in the program. Here are the opinions of other forum
participants, which they shared with Pravda's correspondent.
Yegor Stroyev, chairman of the Interparliamentary Assembly Council and
chairman of the Russian Federal Assembly Federation Council:
It is a misconception that the integration of CIS countries will be at
Russia's expense. Maybe the reforming fathers thought that Russia's
economic levers could be used to reassemble another state in the former
Union's expanses. It is not working. /CIS states are actively looking for
the most advantageous states to cooperate with. Russia is not what it used
to be./ It cannot afford to use its own resources to draw together the
vast expanses of the Asian continent and Baltic regions. We have enough
problems of our own. It is already noticeable how certain principles and
approaches are sprouting up: CIS countries have started realizing that
they cannot survive on their own. And Russian regions are coming to
understand that a bright future cannot be built in one individual
Federation component. Integration, the formation of financial-industrial
groups, the removal of customs and border barriers, and the elaboration of
uniform approaches to the movement of people, monetary masses, and goods
and services in a free interstate area -- this is what is now coming to the
fore in the CIS countries' reforms. It is not politicians who are trying
to integrate, it is entrepreneurs and bankers who are uniting: After all,
between 40 and 70 percent of national capital now belongs to individuals.
Russian Federation Prime Minister Sergey Kiriyenko: (more) 20 jun

aw/owen
The anticrisis program cannot affect only Russia's domestic interests
and cannot fail to be coordinated with the general CIS development policy
and CIS development policy trends. There can be no question of several
programs inside Russia, one of which will be implemented by the government,
another by the Duma, a third by governors, and so on. There can be only
one unified program within the CIS framework. Our financial systems are
fairly deeply integrated, out mutual dependence is high, and economic and
dependable links are closely intertwined. /We all need a single
coordinated stabilization program./ Especially now, given the world
financial crisis.
Republic of Belarus President Alyaksandr Lukashenka:
/Since nothing is working out with Moscow, we have to cooperate with
Russian regions./ At the forum I met with 15 governors of those regions
with which Belarus does not have economic relations. I discovered that
there good progress has already been made in projects. We agreed to meet
in Minsk and to sign such agreements. Probably as early as June we will
sign a treaty with Leningrad Oblast Governor Vadim Anatoliyevich Gustov. 
Belarus is ready to take part in the construction of new ports on the Gulf
of Finland coast. So why, tell me, should Belarusians load mineral
fertilizers at foreign ports? We would do better to load them at your
ports in Leningrad Oblast. We will invest money in this venture. Maybe
not big money, maybe not the entire terminal, but just some mooring will be
considered Belarusian. Or take tractors. Joint production of them can be
organized based at Transmash in Tikhvin and different versions of various
vehicles can be developed. After all, one job in tractor building means 10
jobs for subcontractors. /Life must be breathed into our enterprises. And
trade with the West must be normalized on the basis of $1 billion-worth of
goods from them and goods worth the same sum to them./

*********

#10
Zyuganov: 'Revolutionary Rise Has Begun in Russia' 

Moscow, June 20 (ITAR-TASS)--The Russian Communist Party should
seriously regroup, with a minimum objective not to lag behind random
movement of masses, its leader Gennadiy Zyuganov said in his report to the
party plenum which is meeting on Saturday.
The agenda is the progress of implementation of resolutions of the 4th
Communist Party congress which was held in April.
Zyuganov said a "revolutionary rise has begun in Russia".
"Wave Nine of the people's anger is close," he prophesied.
However, it depends on multiple objective and subjective factors
whether public indignation wells to a revolution, he added.
Zyuganov said the invariable goal of Communists is "impeaching the
president in a peaceful way."
"Without the change of the president, people's patriotic forces will
not be able to resolve a single existing task, there may be no government
of national trust in the conditions of an anti-people regime," he said.
Zyuganov said the president can be forced into resignation by mass
protest actions.
As for the situation within the party and Communist unity, Zyuganov
cited a recent joint decision of the Central Committee and its Presidium

which recognises as "politically erroneous" the bid to create a
Leninist-Stalinist platform within the Russian Communist Party. He said
the platform had been dissolved as contravening the party code.
The Communist Party "will struggle for overthrow of the regime by all
lawful means, with a focus on the awakening of masses, on preparation of a
victorious general political strike," Zyuganov said in his report.
"We have proven that we can work in conditions of a slump in the
social activity, now we are to prove that we can work as effectively in the
conditions of a social rise, and this will demand our serious psychological
readjustment," he went on to say.
Zyuganov laid out the party's priorities.
The first is "as long as the regime is at helm, to hinder the
implementation of its policy by all possible means, not to allow
deamalgamation of natural monopolies, selloff of land, cutbacks in budget
spending on social needs".
He said another priority is "to struggle by lawful means for a
possibly rapid elimination of the regime from power, prepare a general
political strike with the main watchward of the president's resignation,
take to the end the constutitonal procedure of impeaching him", all with
Communists' being prepared for parliamentary and presidential elections "at
any moment".
Priority number three is "to consolidate in every way conditions for
the establishment of legality and people's power in the Russian Federation,
prepare a law base for the implementation of a new socio-economic course",
Zyuganov said.
He said hopes for dialogue with executive power, which was setting up
a state council made of parliament members instead of the government, had
failed.
Even the roundtable format of meetings of the president, prime
minister and parliament leader has not gained momentum, he complained.
That said, the opposition's ultimate goal remains impeaching the
president, Zyuganov said.
He called for "overcoming departmental separation" in preparing the
political strike. "There is no apparatus for conducting the strike other
than trade unions," he said.
He said the Communist Party should have "its own structure ready to
take up the burden of state care for the occasion that the opposition will
have to catch power which has fallen out of the hands of the regime".
Zyuganov said the tactic of setting up the would-be ruling bodies was
misinterpreted by some as merging with authorities.

********

#11
Date: Tue, 23 Jun 1998
From: John Tedstrom <tedstrom@rand.org>
Subject: RAND job

RAND, the world's leading public policy organization, seeks a dynamic
individual to serve as resident director of our technical assistance
program in Kyiv, Ukraine. You should have sound economic skills,
preferably with an emphasis on macro economics and fiscal policy, and some
experience in a public policy organization. Familiarity with other areas
of domestic policy (government auditing, education) and language skills are
advantageous. You will be based at our partner organization, the
International Center for Policy Studies, and will work directly with senior
members of the Ukrainian government. RAND offers a competitive

compensation package including a housing allowance. We anticipate the
incumbent to begin in Kyiv in August or September of this year.
Please send a c.v. and cover letter in confidence to:
Sandy Hanson
RAND
1333 H Street, NW
Washington, DC, 20005

fax: 202-842-5936
e-mail: Sandy_Hanson@rand.org

*********

#12
Date: Wed, 24 Jun 1998 02:31:32 -0700 (PDT)
From: Ken Duckworth <galaducky@yahoo.com>
Subject: Williamson /Biological Weapons- JRL #2235 

In JRL #2235 Anne Williamson writes: 

"Mr. Gailey underlines what common sense says is the most accessible
weapon available to terrorists - biological weapons." 

For any layperson who is interested in the Soviet/Russian biological
weapons program and the threat created by "loose bio-weapons" and
bio-weapons knowledge after the Soviet collapse, I would point them to
Richard Preston's chilling article the "Bio-Weaponeers," which
appeared in the March 9, 1998 issue of the "New Yorker." 
Sincerely, 
Ken Duckworth 
Moscow, Russia 

********

#13
Potanin Moves Past Berezovsky on Forbes List 

PRAGUE -- (RFE/RL) Uneximbank founder Vladimir Potanin, the head of the
Interros holding company, is the wealthiest Russian citizen, according to
the latest edition of the U.S. magazine Forbes. 
Potanin was ranked 186th out of the world's 200 wealthiest citizens and
was the only Russian on that list. The magazine estimated his net worth at
$1.6 billion, up from some $700 million last year. 
CIS Executive Secretary Boris Berezovsky was the highest-ranked Russian
on the Forbes list last year, with a net worth of $3 billion, but the
magazine now says he is worth $1.1 billion. 
Forbes named Berezovsky and three other Russian citizens on a separate
list of those who did not make the top 200: Gazprom head Rem Vyakhirev
(estimated net worth $1.4 billion), Rosprom-Yukos head Mikhail Khodorkovsky
($1.3 billion) and LUKoil head Vagit Alekperov ($1.2 billion). 

********

#14
Russian Show Glorifies Tax Police
By MITCHELL LANDSBERG
June 23, 1998

MOSCOW (AP) - What Russia needs in these days of economic crisis is its own
Elliot Ness. And soon it will have him - two of him, in fact.

With grim determination and moral rectitude, the legendary U.S. Treasury agent
battled Chicago gangsters in the 1930s, in feats later celebrated in the
television series and movie ``The Untouchables.''

By winter, Russia should have its own TV program showcasing the work of some
of its most important - and least understood - government agents: the tax
police.

Each week, Maj. Nikita Ariol and Capt. Dmitri Rusanov will take on the
mobsters and rogue corporations that are bleeding Russia's treasury dry and,
many believe, holding back economic reform.

That Russia needs such heroes has become particularly clear in the past month.
The government's inability to collect taxes was one of the reasons for a late
May market crash that has threatened the stability of an already teetering
economy.

One of President Boris Yeltsin's first responses to the crisis was to fire the
nation's tax chief and appoint a successor, who promised to do whatever was
necessary to squeeze money out of deadbeats.


For that, he'll need people like Ariol and Rusanov.

Unlike Ness, who was a real G-man, these two are fictional characters, the
creation of two producers from a Moscow advertising and television production
company, VideoArt.

Ariol and Rusanov will be champions of justice in a wayward city: the Moscow
of the 1990s, which is often compared to the 1930s' Chicago of Al Capone and
Elliot Ness. And they will be an odd couple - think ``Lethal Weapon,'' the
producers say.

``Our rosy dream is that our characters will become everyone's heroes,'' said
Sergei Beloshnikov, the primary scriptwriter for the new series.

``They are just simple Russian guys who are doing their jobs honestly and well
enough. ... Their motto is, `We can be defeated but we cannot be bought.'''

Beloshnikov and Yuri Sapronov, who have experience producing Russia's version
of ``Sesame Street,'' among other projects, dreamed up the series in
Beloshnikov's kitchen one night last year.
They knew it wouldn't work without the cooperation of the real tax police, so
they arranged a meeting with the agency's brass at their headquarters in a
foreboding stone building at 12 Maroseika St. in central Moscow.

The police already are well-known in Russia for a series of offbeat TV
commercials, one of which shows a hapless tax evader whose sex life has been
ruined by nagging guilt.

The tax police loved the idea for the series - and the producers loved 12
Maroseika St. so much they decided to use it as the name of the show.

The name that should strike fear into the hearts of tax delinquents throughout
Russia. The government estimates that about 5 million people paid their taxes
last year - in a country of 147 million.

Until Mikhail Gorbachev liberalized the Soviet economy in the late 1980s,
there was no need for tax collection here. All salaries came from the state.
What the state wanted, it kept.

The tax police were established six years ago, not to collect taxes but to
fight tax crime. The department has a staff of 38,000, and last year it
uncovered 21,000 tax crimes, sent 600 people to jail and returned several
billion dollars to the federal government, according to spokesman Nikolai
Medvedev.

Its investigators spend much of their time hunched over computers, tracking
companies' financial records for signs of wrongdoing. But the tax police also
send armed SWAT teams into the field, dressed in fatigues and ski masks, and
their annals are full of gunplay and violence.

``The people who make these films will have a lot of material to work with,''
Medvedev said.

The producers agree. Combing through police files and talking to
investigators, they have script ideas involving bootlegging, gas smuggling and
money laundering.

In the opening episode, called ``Operation Green Ice,'' the two cops will
investigate a case involving a Russian mining company that is smuggling
emeralds to the West.

Although the police are assisting VideoArt, they are not financing the show.
The producers say that while they want to encourage people to pay taxes, the
point of the show will be entertainment, not propaganda.

``Our proposition will be simply that good will always win over evil,'' said
Beloshnikov.

``Our main characters will be real people, who love women, who drink vodka,
who have human weaknesses,'' added Sapronov. ``But they have ideals - and
there is light at the end of the tunnel.''

*********