Moscow Madness

The Evening Standard 20-04-1992

By CHRISTOPHER LONG – Moscow

The best joke in Moscow this month was the news that the USA and Europe had decided to give Russia 24 billion dollars to solve its many problems. Coming, as it did, on April Fool's Day, and considering the mind-boggling scale of these 'problems', it was considered a damn sight funnier than such media spoofs as the story of Russian homosexuals crossing the Atlantic on giant inflatable condoms.

It was a lot funnier too than the next joke, announced this week, that full-scale privatisation of industry will be in operation by September and that petrol prices will rise five-fold forthwith.

Like everything in Russia, the sum of 24 billion dollars is either ludicrously too small or ludicrously too large. To ordinary Russians – teachers, doctors or technicians, for example – it is assumed that such a vast sum of money will 'disappear' into the back-pockets of the establishment, the speculators, and the mafia-men as quickly and as surely as dissidents vanished into the gulags or the Aral Sea into the deserts of Kazakstan.

"Can the West really afford so much?" asks Marina Ryklina, a 35 year-old senior adviser to a Russian disaster relief agency, who earns an average Russian salary of 800 roubles per month – 4.00 pounds [two packets of cigarettes in the UK].

While she contemplates her daily nightmare of how to feed her increasingly anaemic family of four on the equivalent of 10p a day [a box of matches in the UK] I make a kitchen-table calculation that every man, woman and child in the USA and Europe is being asked to stump up 50.00 dollars to solve her problems. This, I estimate on the back of a packet of Cosmos cigarettes, translates into, say, 100 pounds from every working tax-payer – just about the sum that poll-(t)axed Margaret Thatcher. And, if some 'experts' are to be believed, we should be contributing three times that much, to Russia alone, every year for the next five years to achieve anything significant.

To be honest, I tell Marina, I don't know. But if 100 pounds from every employed US and European tax-payer really contributes to establishing democracy, assuring world peace, stamping out corruption, dismantling and reconstructing Russian industry, solving the pollution catastrophe, developing the economy, steadying the rouble and radically changing the nature and face of one-fifth of the world's population and one-fifth of the world's land-mass – then in that case it would be cheap at the price.

And Marina gives me that peculiarly indulgent expression that Russians reserve for child-like foreigners who think they know what's really going on and still ask silly questions.

She knows , she says, where the money will go, and so, it seems does Jacques Attali, head of the European Bank for the Regeneration of Eastern Europe. He voiced his fears that without stricter controls the money could easily fall into the wrong hands or the wrong projects, but he was over-ruled by Washington where extending overseas aid is not a popular issue in the recession-hit USA with a presidential election pending.

Marina knows that while the buildings, roads and infrastructure of Moscow are crumbling around her, out in the country, across two continents and eight time zones, there are thousands of almost mediaeval villages with no schools, no hospitals, and many with no electricity or public transport. Will 24 billion dollars reach the parts that communism never reached in 75 years?

Vladimir Ivanidze, is a 32 year-old senior political correspondent for the Moscow's Nezarvicimaya independent newspaper. Everything, he admits, costs too much or too little. But since he only earns about 3 pounds per month and his salary isn't always paid on time, he can't afford to pay more for anything. Today Vladimir can buy 400 metro tickets for the price of a £1.00 tube ticket in London. Bread costs him 2p per loaf. But a litre of full cream milk (only available for the dollars he doesn't have) will cost him the equivalent of four days' pay and any shopping he does will not be at the much-vaunted free-market prices but at prices fixed by one of the myriad groups of Russian mafia who operate at every level and in every sector of Russian life.

While taxi-drivers – anyone with a car in Moscow – can easily earn more in dollars in one day than he earns in four months, a surgeon Vladimir knows is resorting to razor-blades in place of scalpels. He knows that the old nomenclatura and apparatchiks still wield power and influence, still own their dachas, and that few of the government's much-heralded reforms – particularly those relating to land-privatisation – have yet benefited the people.

He also knows, he says, some rather hair-raising stories about the political intentions of senior conservative elements in the Russian army that even the supposedly 'free' press would prefer not to publish.

Will 24 billion dollars really remove the threat of another coup, he asks. Does the West really believe that it can buy political stability? And if the press can still be cowed by the authorities and the people still have no conception, no tangible experience, no local evidence, of 'democracy', will 24 billion dollars on a plate persuade politicians to give up the perks of office and hand over power to people who don't even know what to ask for? Or could it just encourage them to do a lot more talking and posing in the Russian White House for the benefit of the world's press – while hanging on to central power and demanding more 'development aid' in the future?

"Don't kid yourself this is humanitarian aid," an American oil-for-property speculator tells me. One of thousands of free-booting Western businessmen who see Moscow's anarchic disarray as El Dorado and the Klondike rolled into one, he's a self-confessed cynic. He puts no great faith in Yeltsin, Rutskoi, Burbulis or any of the other politicians whose parliamentary antics are much reported by foreign correspondents but impress few in Russia and achieve, he claims, still less.

"This is protection money. These people have cost us thousands of billions in defence expenditure over the past 50 years and now they're in a fix. Remember, there isn't one of them that wouldn't have pulled the trigger on you or me ten years ago. They're a Third World economy with First World weaponry and they're hurting. So they want dollars, they want food, they want all the goodies and all the toys. They all want passports to the easy life in the West but they don't want to get off their butts and do it for themselves. You wait till they've got enough money for the air-fare and they're rolling up at your front door, wanting your job and your house. Don't kid yourself – 24 billion dollars is insurance. It's protection. It says: 'You do it the way we say and the money's yours!'"

Is that what it comes down to: a 100 pound annual insurance premium with the chance of capital growth if the old communists, the spivs and the mafia haven't already grabbed it and run? Who will control it? Will they be the same sort of people who squandered billions of World Bank funds on doomed Third World projects in the '70s and early '80s – or the same bankers who advanced, and then wrote-off, billions in unsecured loans in post-Big Bang Britain?

The US appears to have evaluated the 'peace dividend'; it has calculated the risk of Yeltsin being usurped by a hard-line militaristic and reactionary regime. It has assessed the need for a sufficiently 'strong' Russia to keep the very flammable – mostly Moslem – southern republics in check. It has put a price on what the Japanese can realistically be expected to contribute both financially and in terms of securing stability on Russia's eastern flank – and what the EC can contribute to stability on the western flank – and, hey presto , it has come up with 24 billion dollars in direct aid and/or trade credits.

At Moscow's Kiev Station old women, on pensions of 450 roubles (£2.25) per month, with 60 years of misery etched into exhausted faces, lug pathetic bundles of food onto trains for the slow 200 mile journey back to squalid villages.

At School No 35 in Moscow, deputy headmaster Andrei Zagorski is informed that there will be no budget at all this year for books, teaching materials or repairs to his crumbling buildings.

Around the Lubijanka, the grim old KGB headquarters, endless lines of profiteers and ambitious housewives stretch for kilometres selling highly-priced items which look suspiciously as if they might once have been part of free European humanitarian aid consignments originally intended for the poor and destitute.

Outside the Foreign Ministry in Smolensky Square the traffic police night shift is stopping almost every passing car and extracting 'fines' while those who park are told their cars probably won't be stolen if they've got 50 roubles to spare.

In administrative offices throughout the mind-numbingly vast and ponderous Russian bureaucracy – impinging as it does on almost every detail of everyone's life – sullen and resigned citizens know full well how quickly the queue can move if only you have the right connections, a flush wallet or can return a favour.

In Pushkin Square only the taxi-drivers are unworried by the five-fold increase in petrol prices this week. The fares will simply rise: from an average 50 roubles a ride to perhaps 100 roubles. For Westerners that will be 4.00 dollars, squire, or – as it happens – an average Russian's monthly pension.

All of which explains why it is hard to tell Marina Ryclina whether 24 billion dollars is a little or a lot; whether it will ever reach its intended destination; and whether it's an investment we should really be making.

Seven years later, in 1999, Western governments were shocked and horrified to discover that vast quantities of dollars, given or lent to Russia in 1992-98, had 'disappeared' – into the back pockets of the Russian mafia, political leaders and even, heaven forbid, into the overseas accounts of those very close indeed to President Yeltsin!