Anecdotal account of the 1996 Moscow study trip

Copyright 1996 by Eric Fenster

High life

This year Moscow began in Brussels. During the stopover there, a Russian businessman was checking in ahead of me. He behaved with all the pretension of the newly rich occupying a 5-star hotel, except this residence was... a youth hotel. With him was a bodyguard, typically muscular and in jogging attire. Hearing the room price, all of $20, the businessman nodded at his bodyguard, who ritually drew a wad of bills from a hidden pocket, peeled off the amount, solemnly took the change and returned everything to its cache.

The two climbed the stairs to claim their rooms, but reappeared minutes later. "There are no towels or sheets." Informed that they could rent both, they repeated the money ceremony with all the dignity that remained, but a further humiliation was in store when the businessman learned that the hotel's doors would be locked at 1:00 a.m. There could be no serious carousing on this Western business trip.

A year later

The first changes upon arrival in Moscow seemed positive. Our baggage arrived in the delivery area before we did and customs had done away with declarations of trivial sums of cash (less than $500) or of travelers checks. We would only learn later that Moscow bureaucrats had invented ways to temper any relief. Registering our stay took nearly the whole month. The central and district offices of OVIR, the organism responsible for this, refused to do so, but meanwhile the police were visiting our residence and threatening to fine our host institution for having unregistered guests. Finally OVIR announced we would become early victims of a new policy in Moscow. In place of the old quick stamping of the visa, a long form had to be filled out and submitted with two photos. Then wait.

In central Moscow the building campaign that formed part of Mayor Luzhkov's consolidation of power had progressed since a year ago. The rebuilt Savior's Cathedral had been topped off with a gold dome visible from most of the city. In the Metro and on the streets, there were frequent appeals to help fund the construction, made by itinerant priests and nuns, many of whom, according to Muscovites, were fakes.

The artificiality of the remake of this church, large but not otherwise distinguished when first built last century, had already drawn plenty of scorn from the press and intellectuals, who associated it mainly with the mayor's political ambitions. Even more bizarre was the six-storey underground luxury shopping center rising on the Manege Square just off Red Square. Yes, rising. The steel framework now jutted well above ground level and seemed destined to destroy the space and harmony of that central historical spot, but who is to judge that despite all its other problems such a shopping complex is not a vital priority for Moscow?

A few steps away, the view into Red Square and across to St. Basil's was blocked by the new Resurrection Gate, thrown up during the year in a matter of weeks. A tiny chapel containing an ersatz icon is embedded into the side facing the city and the gate is topped by the imperial tsarist crest. This new shrine did not soften the demeanor of a policeman who spotted an old woman seated opposite, well clear of pedestrian traffic. Beside her was a small cardboard box with a slot into which passers-by might drop alms. The cop walked over, said nothing, poked her in the chest with his nightstick, put the heel of his boot onto the box, and slowly twisted back and forth to crush it flat while he glared contemptuously at the woman. That done, he strolled off haughtily, while she picked herself up off the ground and disappeared.

Two weeks later, I saw a similar scene in front of the Leningrad train station. The square there, half a dozen steps above street level, is packed with hundreds of sellers, but a policeman driving through the crowd spotted somebody he didn't think belonged, a woman who had five bottles of vodka lined up to sell. He backed up his car, turned and drove up the steps to crush the bottles under the wheels. Slowly, and fixing the woman with the same scowl of contempt that also said: I am Power, against me you are helpless.


For some time already, Moscow's pride was the fame it had achieved for overpricing anything meant for foreigners on expense accounts or for New Russians, but many goods and services for "normal" people had remained within reach. Now, despite all the stories of inflation coming under control during the last year, the prices for things like a Metro ride or a phone call had gone up 2½ times. If it were true that the average Moscow salary was the equivalent of $185/month, the monthly transit pass would claim 20% of that and one would have to work forty minutes just to buy a loaf of bread. Fruits and vegetables cost more than in West Europe (already higher than in the US). The same was true of soft drinks, even when they were bottled close by at Russian labor costs.

The volumes of goods and services being traded meant that, in Moscow at least, many people had incomes--hidden or otherwise--that did not correspond to the averages. On the other hand, when I greeted a receptionist on arrival in our residence and asked her how she was, she skipped the pleasantries normal after a year's absence and pointed to her eye. It wasn't the discoloration from a recent operation that bothered her, but the fact that she needed more surgery to remove a cataract and her clinic had just gone private. She was facing blindness for lack of $200. The dezhurnaya (concierge) on our floor was working to supplement a $60/month pension that shrank to $40 after she'd paid her utility bills, but before she had eaten. Before retirement she had practiced legal medicine.

These were not the desperately poor, though. One day while walking with a friend, who is 23 and anything but mercenary or cynical, we came upon an old lady who was begging. Look, said my friend, I can choose to give to her or not give to her; that is my freedom. And she can choose to beg or not to beg; that is hers. I was stunned by this Russian caricature of the old saw that rich and poor have the same right to sleep under the bridge. "What do you mean she has a choice? She begs or she dies."

Nobody dies of starvation in Russia, was the reply. Everybody has enough to buy bread. For the rest, it's their problem to take the initiative to act on their own behalf.

It was hopeless to argue that this was a poor reward for somebody who had probably raised children and grandchildren, worked, and suffered through the war. The old lady drifted off into the jungle modernized Russia had prepared for her. My friend went on to explain why she'd not accepted an offer to move to another company at higher pay because it would not have been honorable to desert her present employer (and, besides, the other company was mafia infested).


The Russian economy remains focused on trade. Most food and virtually everything else are imported, mostly by the millions of "shuttles" who, in medieval tradition, get from China, Turkey or the West what they can carry back and sell. We made three attempts to see something being produced.

In Vladimir the director of a furniture factory explained (ranted) that between taxes that would take more than 100% of his profits and railway shipping fares practically equivalent to the cost of his products, he had a warehouse piled up with unsold goods. He managed to pay wages, he said, only by selling furniture people came to collect themselves. "Demagogue!" snorted our Vladimir host.

In Moscow we visited a machine-building factory that made automated production lines. Same complaints about taxes, but a claim that the company had orders from France and elsewhere and could keep working, although the work force had dropped from 3,500 to just a few hundred. After the talk, we went into the factory. I had our group put on the headsets I use with a wireless microphone when we are in noisy places. The precaution was useless; not one person was working, although the factory was in good order and there were signs of recently built machinery.

They're at lunch, was the explanation. So we went to the cafeteria to eat, too. It was empty as well, except for a total of about a dozen people we saw during our stay. They go home for lunch to save money, was the next analysis offered. Maybe, but at $1 or so the cooked meals here cost less than the ingredients alone would cost in the markets.

The management at both the Vladimir and Moscow factories insisted that the drastic work force reduction came not from layoffs but by voluntary departures, mainly people who chose to "do business" or become shuttles. Both also claimed that their best workers were the ones who left this way.

In Moscow, the factory was privatized under the option that required the workers to buy at least 50% of the shares. The director, however, ended up owning 5% by himself, and since the salaries of plant directors under the Soviet system were not especially higher than those of workers, some machinations had to have occurred. In fact, worker privatization in which the directors became the true new owners was typical throughout the country.

The private dairy farm near Moscow we'd been following for several years was near ruin. The owner had been killed in 1993, apparently for not cooperating with the mafia, the state farm broke the lease on pasture land in 1994, and now the herd had dropped from eighty to seven and the daughter had married and "escaped" to the city. The district's construction boom of multistory luxury homes for New Russians, which explained the land policy, had continued.

Unable to arrange a visit to the dairy farm, we crossed the road to a family farm, created in 1992, to produce eggs. With an essentially no-interest loan the government gave then to encourage private farming, the family had built a 98 m by 18 m (320 ft by 60 ft) concrete barn and installed cages for more than 25,000 chickens and an automatic egg harvesting system. There was not one bird, though. The government was no longer involved; bank interest rates were 213%, but they would not give loans for more than three months. Getting the chicks or feed necessary even to begin was impossible. The family was subsisting on the output of three cows and a few other animals and doing odd jobs for a neighboring summer "pioneer" camp, now open only to rich children, and for owners of the palatial dachas. They said they would probably vote communist in the election.

We revisited the town of Kirjatch, about 100 km from Moscow, to make another comparison against a French TV documentary filmed there in 1993. Whether because town notables were still unhappy about the association of our visit with a film they considered too negative or because things had worsened so much as to be embarrassing (the factory in town was barely functioning), we were not received officially. Olga, the independent newspaper editor who had helped the French TV crew, did not hesitate though. She set up a meeting at the machine-building college. Everybody there was upbeat about both their technical and business programs (the latter based upon the hands-on American junior achievement model) and the facilities did seem very adequate. All the graduates had found employment, we were told, but rarely in the fields for which they had been trained.

Olga said her newspaper had failed and that she was unemployed and living on what she grew in her garden. According to her, unemployment was the lot of over half the town's population. The person in charge of the employment office claimed the figure was only a few per cent. Officially that was so, but he agreed the rate was far higher when one included people employed but not paid, those on forced vacations, those who didn't register because there was no point, etc. On the other hand, in Kirjatch as elsewhere people were earning money as shuttles and in other undeclared work.

How would the town vote in the presidential election? Communist, Zhirinovsky... even Yeltsin, in Olga's view. She would abstain, she said, because she recognized only one authority.

Human infrastructure

The principal at the comprehensive school we'd visited for years was as energetic and optimistic as ever even though, with about 1,800 pupils, he had to operate on two shifts. A different demographic problem would come in the near future. Housing under the Soviet system was distributed giving priority to couples with a young child, so in the giant new apartment complex where the school was found the ages within families tended to be similar. That meant that a wave of children would pass through the nursery and comprehensive schools, leaving a trough in its wake.

The major task of Russian schools, as elsewhere in Europe, is less to prepare children for employment than to acculturate them to the arts, sciences, history and traditions of the society in which they will live. Even with the pragmatic orientation of the new economy, the principal felt he could still achieve that mission. The problem was money. The budget provided only $20 per pupil per month, and about one-fourth of that went for salaries. While a highly qualified teacher might earn as much as $200-250 per month, there were few in this category, and the average salary of the school's personnel was just $80 per month. In the context of Moscow's prices, nothing.

This would explain what we heard from parents. "Good" schools demanded an unofficial (and illegal) entrance fee that could be several thousand dollars. The need to donate for other activities could arise from time to time during the year. Moreover, if a child was having any kind of problem, a teacher was likely to propose to find a good tutor (himself, for example) who could give extra help for, say, $10 or so per hour.

Likewise, after a hospital administrator told us during a visit that medical care was still free and gave us an idea of the low salaries for doctors, she had no hesitation responding to a question about the practice of giving "presents" to doctors. Of course there are presents, she said, lots of them.

Whatever, in both the education and health it became necessary to earn one's livelihood through work on the side, whether within those sectors or doing something totally irrelevant to them, like selling souvenirs on the roadside.

Among the difficulties and contradictions, there were astonishing success stories. Not five years ago I brought a group of auditors and accountants to give a seminar introducing the standard methods in these fields. At that time, our host institution, with only a couple hundred teaching and other staff, employed twenty-five bookkeepers to handle its own finances, and all the books were kept manually. This year the same institution was already graduating its second class of accountants and auditors.

Four years ago, I brought banking consultants to give introductory lectures to Russian bank employees. Today there are hundreds of Russian banks that successfully navigate in some of the most complex and unstable political and financial settings one can imagine.

There was also evidence that the country had passed through a stage in its transition. When we arrived at our residence, the "investment firm" that had occupied an annex was gone. So was the flood of television commercials for similar companies that had thrived on pyramid schemes, making the quick-footed well off but then disappearing with the savings of most "investors." In a matter of months, these speculators on high inflation had completely disappeared.

A chance street encounter led to a discussion with the co-owner of a small downtown Moscow cafe-restaurant about what it was like to establish and run a small business. Over an excellent and reasonably priced meal, he explained the general factors that his business represented in microcosm. First, a mafia "roof" was necessary and, in his case, desirable and comfortable. Government inspectors and tax collectors had no interest in whether a business succeeded or not; if they came for their money and it wasn't available, they would shut a place down without a second thought. The mafia, having a longer term stake in the business's success, provided a start-up loan and kept the government agents at bay. Second, nobody would be willing to work if full wages and the consequent progressive income taxes were declared, so many financial data had to be hidden. Our entrepreneur had a relative and a close friend for associates, trustworthy partners being essential, and since one of his previous jobs had been as a bodyguard he may have had more than a client's role with those who provide protection to small businesses.


"Communists win!" Might that be the most accurate headline for 4 July 1996 after the second round of the presidential election, with a choice between Zyuganov and the remnants of the old Party or the nomenklatura who moved laterally when change came to base their power on wealth instead of privilege?

Moscow was festive in May and June. Typical was the "Mayor of the Year" celebration next to Red Square on May 18. Stands were featuring folk artists and products from many parts of the country, mostly the Caucasus region, and a prize of $110,000 to the person chosen as the best mayor. Somehow it turned out to be the mayor of Moscow.

Mr. Luzhkov was certainly popular for all the development he had undertaken in the city, and while everybody was sure his pockets were lined by every project, nobody seemed to care. Leaving nothing to chance, Luzhkov had one of his supporters run against him in the mayoral race. By law, an election had to have at least two candidates, and the risk that the real opponents would withdraw and force cancellation of the voting had to be avoided. Luzhkov took almost 90% of the vote, a score nearly as high as in the good old days.

He also endorsed Yeltsin, and the poster of the two of them shaking hands with the new cathedral in the background was plastered to nearly every billboard spot in the city. One could search a long time to find a poster for any of the other presidential candidates.

All of the TV channels worked to support the current leadership, especially NTV, Independent Television. NTV, through reports by its own correspondents, had been the only channel to constantly challenge the rosy government version of events in Chechnya. The channel's owner, who was also the owner of a major bank, was thus no friend of the president and had been subjected to an armed attack on him and his bodyguards in late 1994 by Yeltsin's personal militia. The magnate was an ally of Mayor Luzhkov, however, and Luzhkov had made his peace with Yeltsin after winning the battle with the president's privatization chairman, Anatoly Chubais, over how privatization in Moscow would occur and under whose control.

Television did not just slant its coverage in favor of Yeltsin. It organized its programming in his favor. The last week before the election one could see: "Alexander Nevsky," a film about Peter the Great, a film about Tsar Nicholas II including the execution of the family in 1918, a dramatic film of life inside Stalin's Kremlin, films about World War II, "Burnt by the Sun," and so on. All that was heroic and glorious in Russia's long history and all that would recall the evils of communism passed by the screen. An Armenian friend of mine was genuinely distraught one afternoon over the injustice of killing the children of Nicholas II, but it didn't occur to him that the film he had seen the night before was part of an election propaganda crusade. In short, whatever the value of the cause (and perhaps in ironic contradiction to it) the control over the media and the methods employed resembled nothing so much as the communism the campaign was meant to oppose.

But why? Most in my American group accepted the notion of the Soviet Union as an evil place--one person was shocked to learn that "kremlin," despite ominous Cold War connotations, was just the Russian word for fortress and that Red Square had received its name centuries ago--with a captive population yearning for freedom. How then to understand why it was necessary to pull out all stops, to lavish promises worth trillions of rubles, to commandeer the media, to threaten civil war and starvation... to safeguard against the real possibility that Russians would freely restore to power the party that had oppressed them?

Taking sides

The vice-president of an elite economics academy figured in these notes four years ago, supporting Gaidar's team as the only group Russia had that could undertake reforms and scorning Gorbachev for mistakes in Russian grammar that excluded him from respect by intellectuals. I hadn't seen him since, but in the meantime he had advised the government, overseen a project to rewrite many of the country's textbooks (doing several himself) and developed this academy.

This one-time Young Communist League leader still turned livid at any hint of Russia's return to that form of life and still seemed intent on picking up arms to resist such a relapse (even if the comfortable contours achieved through a sedentary profession made the physical expression of his determination quixotic).

His current exemplary hero was Pinochet, which made some of us in the room squeamish, but more telling were the paradoxes in his analysis. Russia today had to be understood in relation to the adoption of the most "deadlocked" form of Christianity a millennium ago (the thousand-year mentality of subservience was also the theme of writer Vassily Grossman in "Forever Flowing"), the fact that the Reformation never reached the country, the abolition of serfdom only in the last century, and traditions of criticizing instead of producing and of redistributing from the rich to the poor. The result of this history, he claimed, is a permanent lumpenproletariat.

One has to take seriously elements of this analysis, but what followed was more disconcerting. His opinion was that this lumpenproletariat was immutable, and since it could not be salvaged it simply had to be discarded through time. As "proof" and support he claimed that certain American intellectuals, sociologists and others, unspecified, had written similar conclusions with respect to poor blacks in the USA.

To what extent was the contemptuous dismissal of huge numbers (a majority?) of his compatriots by this member of the intelligentsia--a class, it must be understood, that carries much more weight in Russia than in the West--perhaps the most candid (and accurate?) expression of the attitude of the "reformers"?

Another professor's assertion that "research had proven" that only about 8-10% of people were born with the genetic capacity for leadership and entrepreneurship was not inconsistent. Neither, but in a different way, was the self-indulgent conspicuous consumption by the New Russians and their seemingly deliberate obliviousness to anything societal.

Maybe there are clues here to how people approached the presidential election. During the month, I did not meet one person who was FOR Yeltsin. If, in the United States, it has become common for many people to vote FOR the lesser evil, Russians in 1996 voted AGAINST what they considered the greater evil. Those voting Yeltsin were voting against a return to the previous communist regime or against instability. Those voting Zyuganov were voting against Yeltsin and what the reforms had done to their personal lives and to their concept of their country. To the extent that nobody seemed pro-Yeltsin, the winner has no popular constituency, a potentially dangerous situation considering the demands the transition will continue to make.

On the other hand, the statement made by Alexander Lebed after his appointment following the first round of the election may have profound consequences. In an extraordinary comment on his new boss, he growled, "I have not one reason to like Boris Yeltsin. Not one! There is an idea and he just happens to be its bearer."

For so long, Russians sought the Good Tsar who would provide their well-being. Gorbachev and Yeltsin were the most recent quests, and like others they were adored on arrival and assassinated on departure for failing to provide.

Lebed really committed a kind of verbal regicide, in effect asserting that there is no longer a Tsar in Russia. Even the boomlet of admiration he himself enjoyed was based upon the belief that he might curtail disorder, not upon the expectation that he could make life better, and he may find himself cast aside after having served the electoral purpose.

By rejecting all pretenders, even the incumbent, to a throne, the people chose to strike at their obsequious past. Whether they can go on successfully to shape the "idea" is the story of Russia's next chapter, but consciously or not maybe they did vote for something.


Contact: Eric Fenster moscowtrip2007@yahoo.com with questions or for more information.