The Militant(logo) 
    Vol.60/No.21           May 27, 1996 
 
 
Yeltsin's Woes Worry Big Business  

BY MAURICE WILLIAMS

Russian president Boris Yeltsin is in a shaky position heading into the June 16 presidential elections in Russia, as the economy continues its tailspin and the war against independence fighters in Chechnya drags out. In the polls, Yeltsin is running behind Communist Party chairman Gennady Zyuganov. The election campaign is being portrayed by the big-business press as a battle between "democratic reform" and the return of a new "iron curtain."

The nine other candidates in the race, including ultrarightist Vladimir Zhirinovsky, former Soviet Union president Mikhail Gorbachev, retired army general Aleksandr Lebed, and U.S.-trained economist Grigory Yavlinsky, have been largely ignored in the media.

On a visit to Beijing in April, Yeltsin stated, "If they [the Communist Party] win, civil war would start in Russia." Yeltsin's security chief, Gen. Aleksandr Korzhakov, suggested May 5 that the elections be postponed, arguing that Russians were not "civilized" enough to take a vote so soon. Yeltsin called U.S. president William Clinton two days later, however, to assure him that the elections would proceed on schedule.

Washington has made no secret of its support for the incumbent, a former leading official in the Communist Party and the government in the Soviet Union. "Thanks to President Yeltsin's leadership, 60 percent of Russia's economy is in the hands of its people, not the state," Clinton declared at an April 21 news conference in Moscow. "Democracy is taking hold."

Anti-Yeltsin sentiment
Zyuganov, for his part, has been riding a wave of anti-Yeltsin sentiment. "The opposition's great advantage is that it is not responsible for what was done in the country over the past four or five years, but Yeltsin is," said Nikolai Ryzhkov, former Soviet prime minister.

Zyuganov has declared he would maintain state ownership of some branches of industry, energy, transport, and communications. He constantly stresses Russian nationalism in public appearances and says he would annul the 1991 treaty dissolving the Soviet Union.

One of Zyuganov's chief advisors is Aleksandr Prokhanov, editor of the newspaper Zaftra, who is well known for his Russian chauvinist and anti-Semitic remarks. Prokhanov describes joint ventures with capitalist investors as "hyenas feasting on the energy of the Russian nation." He assails Yeltsin for not being able to "make a decision without consulting his friend Bill Clinton."

In an April 21 meeting with Clinton in Moscow, however, Zyuganov stated that Washington should not be worried if he wins the election. "The relationship with the United States is friendly, and will continue to be so," he said.

High stakes for capitalists abroad
International investors have been underwriting Yeltsin's candidacy by taking a series of financial measures to bolster his chances for re-election. The International Monetary Fund (IMF) agreed to give Moscow a $10.2 billion loan last March. This loan followed a $6.2 billion loan provided by the imperialist financial institution in March 1995.

On April 29, a group of international creditors, called the Paris Club, rescheduled $40 billion of the debt of the former Soviet Union. Moscow assumed responsibility for $120 billion to $130 billion in debts accumulated by the former Soviet government.

The Russian government was due to repay $8 billion this year. The new agreement requires Moscow to make annual interest payments of $2 billion, gives it a six-year grace period on principal repayments, and spreads its remaining financial obligations over 25 years.

The Paris Club deal is contingent on the IMF pact, which requires the Kremlin to reduce social spending and limit state control over the economy. "If the agreement with the IMF collapses, the accord with the creditors collapses," declared Christian Noyer, chairman of the Paris Club.

Meanwhile, the London Club of commercial bank creditors is negotiating a deal to reschedule $33 billion of Russia's debt to commercial banks.

A U.S. treasury official told the Wall Street Journal the financial arrangement was good because it involves no debt write- off and obligates the Russian government to "pay in a timely way and pay it all." Russia's publicly traded commercial debt rose one cent April 29 to 41 cents on the dollar, up from a low of 18 cents in March 1995. The Russian government pays more for the money it borrows from investors than almost any other government in the world, according to the Financial Times.

An article in the April 29 Journal said bankers made the deal to back the Yeltsin regime because "a Communist government could choose - as Lenin did 75 years ago - not to honor the foreign debts."

While capitalist investments continue to trickle into Russia, they are low compared to those in Eastern and Central Europe. From January 1991 to October 1995, international investments in Russia, a country of 148 million people, amounted to $4.9 billion. Hungary, with 10 million citizens, received almost twice as much in the same period.

Meanwhile, the conditions of working people in Russia continue to worsen. Life expectancy for men dropped from 63.8 years in 1990 to 58 years in 1995. The mortality rate per 1,000 people soared from 11.2 in 1990 to 15.7 in 1994.

Unemployment has risen from 7.5 percent to 8.2 percent, while real income for Russian workers plunged 13 percent last year. Millions of workers are frequently not paid on time. More than 500,000 teachers went on strike last September to protest unpaid wages and low pay.

Moscow fails to crush Chechens
Yeltsin has publicly stated that his re-election hinges on ending the war against Chechnya. More than 30,000 people have been killed since the Russian president sent thousands of troops to crush the Chechen fight for independence in December 1994.

Russian helicopters fired rockets on an outdoor market in the Chechen village of Urus-Martan May 7, killing 5 people and wounding 21. "My husband and I were on our way to get water," a woman told Associated Press Television. "From nowhere came five helicopters and immediately started bombing the market."

Yeltsin announced a cease-fire March 31, but Russian soldiers continue pounding rockets and artillery shells into Chechen villages. At the height of Moscow's military onslaught, more bombs were dropped every hour on Grozny, Chechnya's capital, than were dropped on Sarajevo per week during the most intensive fighting in Bosnia, according to one Financial Times report. The Economist reported that the war has cost Moscow some $5 billion.

Washington has remained a firm supporter of Yeltsin's assault in the region. Asked whether that stance was wrong, Clinton told reporters, "I think it depends.... Do you believe Chechnya is a part of Russia, or not? I would remind you that we once had a civil war in our country in which we lost, on a per capita basis, far more people than we lost in any of the wars of the 20th century." Clinton added that the U.S. government "has taken the position that Chechnya is a part of Russia."

Russian generals say the number of Chechen fighters steadily increases whenever the Russian military enter a region, as Chechen workers leave their day jobs and take up arms, the Financial Times reported.

Chechen leader Dzhokhar Dudayev, who was killed in an April 21 Russian rocket attack, said recently that the rebels were much more committed to winning "the war than Russia, because what is left for us? A destroyed economy, no industry, no production. People are left without a roof over their heads, without bread, without jobs."

Streets in Estonia, Latvia, Ukraine, and Turkey have been named in honor of the slain Chechen fighter. Members of Parliament in Poland gave a brief tribute to him in early May.  
 
 
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