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If one collects all the rumors surrounding the new Russian government’s program, it becomes a real detective story. Even now, with work on the program nearly finished and only the government’s approval of the draft to go, there are stunning assumptions in the press.

For example, that President Vladimir Putin may base his strategy not on the program of the Center for Strategic Research, but on that of Yury Masliukov.

It is well known that Putin himself founded the center and gave it the task of creating an economic strategy for Russia. He appointed German Gref and Aleksei Kudrin as the heads and met with them regularly to cultured akoya pearl discuss progress. He made former Deputy Minister Kudrin the minister of finance and vice premier responsible for economic departments of the government, and he named Gref, also a former deputy minister, head of the newly formed economic superministry that replaced the three former ministries.

All this to then take the proposed Communist opposition program, without even having discussed the center’s program, and appoint Kudrin and Gref to carry out someone else’s ideas? This would be a very strange step, and it is worth explaining the logic behind it.

It is true that, when Mikhail Kasyanov was asked his opinion on Gref’s program at his confirmation by parliament as head of government, he said he had not read it. But this may have been only the formal truth: Insofar as the program had not been presented to the government as an official document, anything Kasyanov may have read could only be considered a draft text.

But it is hard to believe that the acting premier would be entirely unfamiliar with the document intended to determine the direction of the government for the next 10 years.

This was probably an intelligent tactical move by a known diplomat and financier: The Communist Party spoke out strongly against Gref’s program when the premier’s candidacy was under discussion, and Kasyanov did not want to akoya pearl jewelry force leader Gennady Zyuganov’s supporters into a conciliatory position over his candidacy.

Now that the work is finished, Kasyanov cannot say he is unfamiliar with the final text. On May 22, he introduced the team in Gref’s Ministry of Economic Development and Trade. That very evening, Gref, along with colleagues Yevgeny Gavrilenkov and Mikhail Dmitriev, presented the program prepared by his team in a round table discussion with the Moscow Carnegie Center.

Judging by statements, the program reflects a completely liberal approach to economics. The strategic aim is to reinforce the growth tendency that has appeared in the last year and a half. A key resource is the huge amount of currency leaving Russia: about $18 billion a year. If even a half of this amount can be reinvested in Russia, the GDP would rise by 10 percent a year. The current program promises a yearly growth rate of just above 5 percent with a 70 percent total GDP increase by 2010.

To create a favorable investment climate, the first step is to protect private property, mainly by strengthening the weak court system. The second step is to lower the tax burden on producers. The reduced budget income would be compensated for by reduced spending, primarily in social areas. A key part of this is a reform of the pension system and of utilities and housing, which in 1997 received more in subsidies than defense and law and order enforcement combined.

The program’s authors recognize the political and social risk involved in the proposed reforms. In their defense, they offer two main arguments. Firstly, the government will not have the money to fulfil its social obligations anyway. If the current pension system is not reformed, for example, it will collapse in a matter of years because of the aging population and increase in the number of pensioners. In 2010, it will be impossible to game machines cover pension payments with tax collection.

The second point is that there is no conflict between economic and social goals. There is a conflict between unreasonable social goals and more rational ones. The current discounts, mainly those affecting residential maintenance and utilities, essentially redistribute money from the poor to the rich. The proposed reform would reverse this flow.

The political difficulty is that the population of Russia grew up in a world where market relations were forbidden fruit. It does not yet fully understand the dynamics of the market, nor does it always properly assess its own interests. This becomes a breeding ground for leftist populism.

The problem is that Russian reformers usually explain their policy poorly and organize essential reforms badly. The recent sharp drop in Russian share values, unexpected and hard to explain in the light of economic successes, shows how weak the improvement in the Russian economy is.

So it’s happened. The government of Prime Minister Mikhail Kasyanov has adopted the program drawn up by German Gref’s Center for Strategic Development. A government meeting on June 28 officially approved the “main directions for long-term social and economic policy” and the “priority tasks for the government in 2000-2001.”

Gref and his team had been fuelling the political rumor mill for several months. First, there was talk of the new authorities not being as liberally minded as they said they were and quite capable of choosing instead the program of Communist Yury Maslyukov – or a similar one drawn up by a group of academics headed by Dmitry Lvov.

Then came rumors of conflict between Gref and Kasyanov – Kasyanov wasn’t sufficiently liberal, Gref was too academic, Kasyanov was simply jealous. But all this has been overturned. Maslyukov and the academics were indeed consulted when the program was still in its early stages, so that pearl pendant all the different ideas had been heard. And there never was any real conflict between Gref and Kasyanov.

On June 28, Kasyanov declared the government team to be unified and committed to liberal reforms. A good thing, because Russia will never have a deficit-free budget if it doesn’t follow liberal principles.

But Gref’s program did undergo some noticeable changes during the last intensive days of government discussion. It became shorter by half and also more restrained in its forecasts for economic growth through to 2010. The predicted annual increase in GDP is now 5 percent, rather than the previous 8-10 percent.

Politically, this prudence is logical, but it doesn’t have any practical importance. It is difficult in any case to predict the future growth rate. The Soviet planned economy method measured government aims in quantity terms, whereas now, they are measured in terms of visible institutional transformation. Now that Gref’s program has been approved, the main question is whether it will be possible to carry out the changes it calls for.

The government held discussions on this point, accounts of which say the issue was raised as to cultured pearl how realistic the central political idea of the program is – the development and implementation of a new social contract.

Though Russia has gone through a decade of reforms, the old paternalistic socialist contract between the state and its citizens is still largely in place. The state spends vast sums of money keeping afloat unprofitable and unnecessary enterprises, not for economic considerations, but for purely social reasons such as maintaining jobs and social infrastructure.

The state doesn’t target the assistance it provides, but rather, gives benefits to whole categories of people. There are hundreds of these groups – 70 percent of the population is entitled to some benefit or other. But only a quarter of those receiving benefits are people who earn less than the living minimum. In trying to maintain this unnecessary burden of social expenses, the state is unable to keep up genuinely necessary social values like accessible and free education and health care. The pension system is also on the verge of collapse.

The idea behind Gref’s program is that the state will now concentrate on these basic things. Budget spending on education is to increase next year. The government will gradually shift from a budget-funded pension system to a system based on pension funds. Some groups will also see their benefits get the ax, especially transport and housing benefits, and there will be a shift to freshwater pearl targeted state assistance. The state will stop supporting unprofitable enterprises and do more to help create new jobs rather than maintain old jobs.

In his presentation to the government, Gref stressed this idea of a new social contract and it met with approval. The state doesn’t really have any choice – the only question is whether to announce it all out loud, or just to get quietly on with it and do what’s necessary.

But the problem is not one of announcements, the problem is whether Russia can accept and implement a new social contract. Are people ready to accept it? Are officials ready to carry it out? The public would accept reasonable ideas if the officials prove capable of explaining them reasonably, and more importantly, show themselves able to fulfill them. For the moment, the public suspects that when it comes to housing reform, for example, the only part of the reforms supposed to bring about greater social justice that will actually be carried out is the part involving rent increases.

Events outside the government seem to confirm these fears. The presidential apparatus was so keen to wholesale pearl jewelrypush through new laws restricting the powers of regional governors that it resorted to clumsy tactics in its zeal. Everything that could be done to rouse governors’ suspicion and unite them against the reforms was done. The law that seemed sure to get through not so long before fell through. This – President Vladimir Putin’s first real failure – can be rectified, but only if Putin’s apparatus shows itself capable of learning from its mistakes.

The Soviet Union was famous for its art of political imitation. It had an imitation parliament, the Supreme Soviet, which always voted unanimously in accordance with the Communist Party’s instructions. It had imitation elections without alternative candidates and any party other than the ruling party. There was imitation justice with courts obeying party-district-committee instructions, and even imitation freedom of speech in the form of “national discussions” on issues set by the party, with the outcome already known.

Since reforms began, a whole generation has grown up with no firsthand experience of this imitation world. But the events of recent days show that there are still many people around who would like to return to the political mores of yesteryear.

Above all, this concerns attempts to bring back imitation rather than authentic freedom of speech. The NTV television channel that has just begun broadcasting has nothing in common with the independent NTV company, except its name. The magazine Itogi that is about to wholesale pearl jewelry publish its first issue is not the old Itogi, published with the support of American weekly Newsweek. This new Itogi is being put out by a new team, while the old team under Sergei Parkhomenko has been fired en masse.

But what is really worrying for the future of freedom of speech in Russia is the government newspaper Rossiiskaya Gazeta’s publication of an article calling for a return to censorship. The existence of censorship was considered a state secret in the Soviet Union – even the Communist Party didn’t think it possible to openly admit to its use.

In the case of NTV, it’s obvious that Soviet imitation justice has also been revived. This wasn’t hard to do considering that the last decade of reform has all but bypassed the judicial system. The courts have hardly changed since Soviet days, and that two different judges in different cities could reverse their decisions overnight doesn’t surprise anyone in Russia.

Now, work is under way on creating an imitation parliament. Four political groupings in the State Duma have set up a coordination committee, which will make for a united bloc of 234 votes. Duma procedure requires 226 votes for a simple majority. No one in the Kremlin seems bothered by the fact that this group includes not just pro-government Unity (Yedinstvo) but also former Prime Minister Yevgeny Primakov’s OVR (Fatherland-All Russia), which opposed Unity in the last Duma elections.

The Kremlin faces quite a different problem in the Duma. The new pocket party can ensure enough votes to get laws passed but not to Keishi pearl make amendments to the Constitution, which would require the votes of 300 obedient deputies. This is not an idle question, because the Kremlin looks like it would definitely like to make some amendments. Getting the necessary 300 votes would require support from the Communists, but there’s always the possibility of coming to an agreement with them based on their shared love of demonstrative patriotism and Soviet values as exemplified in the restored Stalinist national anthem.

Returning to the NTV case, we’re now seeing a new type of imitation – the use of imitation market relations. Events surrounding the company imitated an apparently commercial dispute, although no one has bothered to explain what commercial motives drove Gazprom to acquire shares in an indebted company with no relation to its core business in the first place.

But attempts to imitate market processes will run up against substantial difficulties. It’s possible to imitate economic growth at a propaganda level, but there’s no way to make the public believe in imitation improvement of their living standards. Only real economic growth can create real prosperity.

But economic growth stopped at the end of last year, and so far, there are no signs of a return to pearl strand the boom that began in mid-1999. Sustainable growth would require new steps toward reform, and here no imitations will help. President Vladimir Putin seems to understand this. His appearance at a recent Finance Ministry meeting – unprecedented for a president – showed just how high a priority he considers economic issues, as do the critical comments he made at the meeting.

But active tax authorities and a careful budget policy alone won’t be enough to bring about economic growth. Also needed are serious cutbacks in state spending, above all defense and social spending. Imitations won’t work here: Real and difficult political measures are required, which must be based on public consensus arrived at through democratic means. It’s hard to see how this will be possible with all the imitation going on.

Meanwhile, an event has taken place that was barely noticed but could herald important changes in the situation in Russia. In March, the Consumer Sentiment Index (CSI), a U.S.-devised index that has been measured in Russia since 1993, underwent a significant drop.

Beginning in July 1999, the CSI had shown rapid and sustainable growth, which reflected growth in people’s incomes over this period. Income growth was due in large part to swing machines payments of wage arrears and a rise in job creation. But now, the trend is reversing, with wage debts once again on the increase and employment figures dropping. Whether this signals a trend toward stagnation is something only time will tell.

President Vladimir Putin, close in age to Boris Yeltsin’s daughters, has proposed as prime minister a man from the same generation – 42-year-old Mikhail Kasyanov.

There is, it seems, nothing new in this. His generation has been leading reforms for eight years now. But Yegor Gaidar, Anatoly Chubais, Sergei Kiriyenko and Boris Nemtsov, the big names among the reformist politicians, were called to power only in the most critical moments. Like political kamikazes, they were sent to pull off the near-impossible and were removed at the first sign of failure.

The real bosses remained those who, like Yeltsin himself, had entered the upper circles of power back in Soviet times. Many of them, former Yeltsin sidekicks from the Urals like Oleg Lobov, or security men like Alexander Korzhakov, weren’t able to pearl jewelry wholesale adjust to the new era.

But they were still closer to Yeltsin than the young reformers, and before having to leave the stage, they had time to pull him into their schemes, with all the consequences that entailed. Only the most pragmatic and teachable of the old school of politicians, like Viktor Chernomyrdin, managed to adjust and pursue market and democratic reform. But only after costly experiments and mistakes.

Despite Yeltsin’s hostility to the Communists and their inheritance, it is only now, with his departure, that Russia has finally parted ways with its Soviet leaders. Now, the 40-somethings can really rule the country. And it’s no coincidence that Putin’s closest economic advisors, Alexei Kudrin and Andrei Illarionov, are from Gaidar’s and Chubais’ first team.

This means that, on the political level at least, the country no longer has to deal with elementary failure to even grasp what a market economy is all about. Over the last decade, this caused more problems in Russia than is commonly thought. Even more progressive politicians like Yevgeny Primakov and Yury Luzhkov ran up against it; not to speak of the opposition camp. Today, the problem is not one of understanding reform, but of determination to bring it about.

Everyone sees that taxes need to come down and that social costs are too high. But the temptation is huge to freshwater pearl necklace put off all these tough decisions, reasoning that things are going well now and hopefully won’t get worse in the future.

The day Kasyanov was proposed as prime minister, the Fitch IBCA credit rating agency raised Russia’s rating by two points at once. The same day, the Financial Times, which had published some damning reports on the state of affairs in Russia, put out an eight-page supplement on the economic wonders going on here.

There are reasons enough for this – the 7-point GDP growth in the first quarter compared to last year, is a record result not just for the reform years, but for the last 30 years. Even more impressive are foreign debt payments, which should reach $5 billion for the first semester – with no money coming in from the International Monetary Fund, and without the government borrowing from the Central Bank, though the budget allows it.

Gold reserves increased by $5 billion over four months. Inflation is forecast to akoya pearl necklace drop to 5 percent over five months (last year it was 8 percent for January alone). Wage debts decreased by $2 billion over six months. And last autumn, real incomes began to rise for the first time in three years.

This list of good economic news could go on. And it can’t all be explained by high oil prices – the economy is obviously benefiting from some other resource as well. This resource, it seems, is the long-awaited recovery in the real sector of the economy. This is the result of the reforms of the last eight years, half-baked reforms as they might have been. But if this is so, then maybe the government doesn’t need to give anything a shakeup now? Wouldn’t it be safer to just go with the flow?

Economists know that you can’t just go with the flow. A worn-out capital base, obsolete technology and poverty are all problems too serious to solve without taking reforms to their conclusion.

Russia’s new rulers surpass the Yeltsin of 1991 in their understanding of how a market economy works, and this will certainly help them. It remains to be seen whether they can compare with Yeltsin in terms of political will.

The idea of creating a Slavic union embracing Russia, Belarus, and Yugoslavia is nothing new. In the past, sensible politicians perceived it as matter of fancy. So too today.

The matter lies not so much in the international situation as in political tensions inside Russia. Impeachment hearings in the Duma are scheduled for April 15. Although the chances of the president’s removal from office are insignificant, Yeltsin understands that if his opponents succeed in collecting the required 300 votes for at least one accusation to go to the next stage in the proceedings, it might become his Waterloo.

Seleznev tried to persuade his colleagues to pearl jewelry postpone impeachment, saying that Russia needs to demonstrate unity and consent. But his move only aggravated his Communist Party comrades who are hungry for the president’s blood.

Now a new pretext appears to have been found to derail impeachment: the idea of a Slavic union. Last week, Seleznev visited Yugoslavia, met with Yugoslav President Slobodan Milosevic, obtained a verbal consent from him, and, on Friday, having just returned to Moscow, rushed to brief the president on the results.

Everything was arranged spectacularly. Right after Seleznev spoke to the president, the Duma convened a meeting to discuss how the impeachment vote should be arranged. The Communists insisted on an open vote, so that deputies would fear to step out of party lines. By the time the Duma adopted its agenda, Seleznev stepped in. He reproached reporters on his way in for ignoring his press conference the day before and entered the meeting hall swiftly. It was there that Seleznev announced the “Slavic re-union” concept.

He spoke of it as a closed matter: “The president has supported this proposal,” he said.”The president called Belarus President Aleksandr Lukashenko in my presence…

“State institutions have been ordered to pearl jewelry Chian prepare all necessary documents,” he added.

Seeking to eliminate any doubt, Seleznev also said the Kremlin would release a videotape of his meeting with the president, proving the historical decision had been taken in earnest.

He then delivered the president’s moving request to Russia’s deputies asking for the impeachment vote to be postponed. “This isn’t the right time,” he said.

But the responses to Seleznev’s motion were disturbed by a lone query: Does a union mean that if NATO proceeds with its military action against Yugoslavia, Russia will find itself in a state of war?

Seleznev’s reaction was odd. “This is not a press conference,” he retorted.

Then Seleznev was let down. Though the Communists were unequivocally supportive of the proposed union, they believed it would be even better without Yeltsin. Even worse for Seleznev was that the promised video of the “historical” meeting in the Kremlin turned out to show nothing sensational. The president did not promise anything specific.

Yeltsin even went on the offensive, prompting his press secretary, Dmitri Yakushkin, to declare: “The postponed impeachment is a constantly smoldering threat to the country’s political stability.”

As details emerged, the case became clearer. The Kremlin used Seleznev, someone the Communist Party would trust, to pearl earrings introduce the idea of a Slavic union. And the president finally got what he wanted: the Duma decided to take a secret rather than an open vote on the impeachment issue.

The Kremlin now has an opportunity to “steal” votes from the Communists. The president may be interested to organize a vote as soon as possible. If all five items of the accusation fail to receive the required 300 votes, Yeltsin will be relieved of the headache of impeachment proceedings forever.

As far as Seleznev is concerned, it is probably his journalist’s past that played a trick on him. After all, how can a former newspaperman resist the temptation of breaking a sensational story?

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