Recntly, the Kultura paper related an amazing story about life in Russia today. There used to be a five-meter statue of Stalin on the bank of the Ob river, in the “land of the exiled”: Narym, the Tomsk region. They say the party leaders of the village once considered replacing this statue with a 100-meter statue, visible from far away, but then the Soviet era ended. Under Nikita Khrushchev the “Father of the People” was brought down, and only the head of the statue was first exhibited in the local Stalin museum, then hidden inside a wall.

However, under one of the later secretaries of the Communist Party regional committee, Yegor Ligachev, Stalin’s head was again installed in a place of honor in the museum, where it has remained until now. The bust of the leader divided the museum into two parts: one tells about Stalin’s life in exile, another tells about those who were exiled by his order.

The difference is obvious: Stalin stayed in Narym for 41 day, then he was gone, having left only a suitcase, a cup, and a saucer. He did not have to work in exile, as the czar government paid enough for maintaining the exiles.

However, after Stalin got to power, dozens of thousands of people were exiled to Narym. First exiles of the early 1930s were rich peasants with their families, who were disembarked from barges right into the woods, without any food. Exiled clergymen followed peasants, in 1937 the population of the town was replenished with “people’s enemies”, and finally in the end of the Great Patriotic War, with people deported from the Baltic republics, Western Byelorussia, and Bessarabia….Local people say that at times they had to make communal graves in autumn in advance, not to hollow graves in frozen soil. Today all this is history. And now the local authorities decided to used the present market economy times and use the history for attracting rich tourists. The idea is not an innovation: they decided to restore the Stalin’s statue in NArym. As initiator of the project, head of the Parabel district Nikolai Kobelev, explains that they plan to “settle a small sculptural composition: Stalin is sitting by a house, and is thinking of something….” Funding of the so-to-say cultural action is not an issue, according to Mr. Kobelev, “The local budget allocates money for municipal improvement, and this money can be spent on the monument.”

Kultura writes that the morale of the story is beyond discussion.

The head of the local administration has no doubts that there are extremal tourists, who will find it interesting to cover the 400 kilometers from Tomsk to Parabel, and then 35 kilometers further down the Ob river, from Parabel to Narym in order to take a picture standing beside Stalin’s statue next to his museum. It should also take into consideration that weather allows arriving in Narym only five to seven months a year.

The staff of the Narym museum support Nikolai Kobelev’s idea: they are convinced that under Stalin “order was much better than at present, and people’s lives were also easier”. However, according to the paper, the main thing is that many people in the region still respect “the leader and the teacher”: “When the bust was taken away from the exposition, the people demanded it to be returned – we must not forgive our history. And Stalin is a key figure in the history of our land.” Numerous approving letters and calls to the editor’s office of the regional newspaper that published information about the initiative of the Parabel administration support this opinion.

“The myth of Stalin and order” still determines the historical consciousness of many people of the older generation,” notes Kultura. Perhaps, it concerns not only “people of the older generation.” This story is a graphic example of the present Russian reality: on the one hand, it is the permanent people’s respect for the one “who was able to put the country in order”, on the other hand, it is an attempt to realize the principle “all for sale”.

Obviously, not a good life caused the attempt. According to the Finansovaya Rossia newspaper, the State Statistic Committee reported that in February the wage arrears increased by 4 billion rubles and amounted to 34.6 billion rubles. In a situation, when wage arrears are starting growing again, all try to make money as they can.

As is know, in the beginning of the year, the Russian budget started having serious problems with revenues, as the world oil prices fell. Local authorities are looking for ways out of the situation. According to Finansovaya Rossia, in the Nizhny Novgorod region local authorities are discussing a possibility of selling a third of the regional state enterprises. In accordance with a resolution of the Krasnoyarsk governor, the salaries are to be paid from the Obligatory Health Insurance Foundation. The Kostroma region plans to take a loan to pay wages, although it is not clear how to repay it.

Surprisingly, the paper notes, despite the wage arrears growth, only teachers and street cleaners tried to hold strikes, although the budget debts to them does not exceed 5% of all arrears. Personnel of industrial enterprises, whom the state owes 83% of all sum, are being patient as yet.

Finansovaya Rossia reminds that from January 1, 2002, a new Labor Code came into effect, which stipulates punitive measures for every day of wage delay. However, at present this item of the law does not work: according to Deputy Prime Minister Valentina Matvienko, the government will have to pass no fewer than 40 various standard acts before the budget-sector employees will be able to use it.

As Finansovaya Rossia informs, “economists determined a 4 to 5 months constant wage delays level for the social tension this issue causes.” In most cases local authorities follow this statistics and the wage arrears are repaid from time to time, accumulating all the time.

According to the paper, there is an impression that the government is awaiting for another default, in order to write off all the debts, like in 1998.

Finansovaya Rossia stresses that the issue of wage arrears is hardly studied in Russia: the west has long recovered from this economic disease. “In Russia the disease is permanent because of a very simple reason: as long as people do not protest, the wages are not paid.”

However, according to Nezavisiamaya Gazeta, same Valentina Matvienko recently said in her speech to the Duma that the federal budget has no wage debts. It is mostly local authorities that own salaries to budget-sector employees. Besides, according to the government the situation is not terrible: although overall in Russia the wage arrears total 2.7 billion rubles as of March 1, 2002, in 54 regions of the country there are no wage arrears at all or they are no more than several days delay. In 27 regions wage delays are three to ten days, and only in seven regions wage delays exceed 10 days. At the same time, the deputy prime minister also stated that “in a number of regions there is a number of municipal formations, where salaries have not been paid for several months.”

However, even this “rather decent situation” constantly disturbs the government with the necessity to provide the insolvent regions with certain means for repaying wages. Moreover, federal regions have already gotten used to such a situation and rely on the sort of financial aid in the future.

Meanwhile, as Galina Kurlyandskaya, the leader of the Center for Fiscal Politics recently said in her interview with the Nezavisimaya Gazeta paper, “according to prior experience, as soon as money get to a regional budget, they suddenly remember that subjects of the Russian Federation are independent and have to right to spend the money at their disposal.” That is why the growth of wage arrears is to continue. The media started developing the federalism topic, including budgetary independence, in connection with approval by the Constitutional Court of the right of the president to dismiss regional governors and local parliaments.

However, the Constitutional Court stipulated a rather complicated procedure for implementation of this right, which requires not only all bureaucratic formalities to be observed, but also an approval from various courts, including the Constitutional Court, to be received.

At the same time, the Gazeta periodical stresses, “the fact of a possibility to dismiss regional governors will allow the Kremlin to create the necessary power hierarchy.” According to Gazeta, initially the law was made not to dismiss governors but to frighten them. Now, the authorities once again demonstrated to the society to the idea that “some day the president will be able to not only dismiss but also appoint governors.”

In these terms, it is impossible not to mention the suggestion of Yaroslavl Governor Anatoly Lisitsyn on consolidation of the regions.

As Lisitsyn said in his interview with Nezavisimaya Gazeta, existence of 89 regions in the federation makes it impossible to normally rule the country, besides, it would be economically reasonable.

The Yaroslavl governor explained, that Russian regions greatly vary by their economic prosperity. There are about twenty donating regions, there are averagely developed regions, which maintain themselves by 60%-70% receiving the rest from the federal budget, and the largest group – about half of the federal regions – is recipients of money from the federal budget.

At the same time, according to Lisitsyn, donating regions have been “cropped” recently: over the last year they lost 10% to 20% of their proceeds, despite the stipulation of the Russian Budget Code on equal division of all tax revenues between the federal center and regions.

The Yaroslavl governor believes that resolving of the issue requires the state structure of Russia to be changed, “it is necessary to consolidate territories, following the principle of merging “weak” and “strong” regions.” According to him, it is necessary to unite regions “on the basis of thorough economic analysis and calculations”, and the first experiment could take place in the North-Western and Central federal districts.

In the opinion of Lisitsyn, the president should appoint the leader of the new federation subject, “As if there are any problems or troubles, the president will be able to dismiss him and to appoint a more worthy person.” After the experiment is over, the election system is to restore.

According to an expert of the Moscow Karnegie Foundation Andrei Ryabov, a constant recurrence to the topic of “appointment and dismissal of regional governors” creates in the society a certain “moral-psychological atmosphere”, which will finally allow “to accumulate the necessary critical mass and legitimize the theme.”

This method may gradually prepare the society for a complete reconstruction of the state power system and reconsideration of the Constitution.

The Novye Izvestia paper believes that “the intention of the Kremlin to suppress the regional leaders and to restore the unitary state” gives no future to the country. Besides, the paper warns, the “regional spring” should not be pressed too much, otherwise it may repulse very hard.”

In these terms, the Nezavisimoye Voyennoe Obozrenie weekly cited the report of the US National Intelligence Council, which is the supreme analytical body of the US intelligence community. The report entitled “2015 global trends: dialogue with non-governmental experts” says, in particular, about Russia’s internal issues, resolving of which will directly influence its foreign political opportunities and the role on the international arena.

According to US analysts, in the near future Russia is to fully lose its role of a leading world power, both because of foreign political reasons and the economic state. The general trend of Russia’s political system development is authoritarianism, “though not as extreme as in the Soviet period”. The evidence of the trend is the course of President Putin on “establishment of a tough hierarchical system of centralized ruling the country from Moscow” and support of this course by the population, as “an alternative for a complete disorganization of the society”, as well as continuation of the process of redistribution of tax resources from regions to the Federal center.

According to CIA experts, this power centralization trend negatively influences the efficiency of ruling, “Ina country of this size and such great diversity as Russia is, centralized ruling is impossible.”

Recently, the Vedomosti paper informed that Johannes Linn, deputy President of the World Bank supported the idea of returning budget revenues to the regions. Making a speech at the annual conference of the Supreme Economics School, Mr. Linn reminded that during a transition period, the engine of the economic growth are new private enterprises, if they involve no less than 40% of the population; at present, less than 30% of the Russian population are employed in private enterprises. In Russia, regional bureaucracy is a brake for development of entrepreneurship. While the government instead of involving local officials in the course pf reforms, reduced the part of proceeds controlled by regions from 15% to 11% of the GDP. Mr. Linn states, “Such a trend may make regions start looking for various unofficial and acceptable ways for acquiring means and influence.”

According to deputy president of the World Bank, the way out is “to enlarge the official budget autonomy” to relieve the officials of the temptation to use “gray schemes”.

However, Russian experts do not agree with Mr. Linn. In particular, Vedomosti published the opinion of Director of the Economic Expert Group Maxim Kulikov, “Theoretically, outbalancing taxes to the federal center is an evil, however, in Russia it is a less evil as financial management on the federal level is evidently better than on the regional level.”

However, judging by everything, the Kremlin admitted it necessary to make amendments to the tax system it created: a special commission headed by deputy head of the presidential administration Dmitry Kozak is to have prepared suggestions on its decentralization by June 1, 2002.

According to the media, after a traditional Monday meeting with the government, the Russian president stated that the present executive branch of power greatly lacks new ideas and suggestions. The president rejected the medium-term plan for development of the country, presented by the cabinet of ministers; moreover, both pessimistic and optimistic alternatives of development were rejected. Putin stated that both plans “do not guarantee decreasing of the gap between Russia and the major industrially developed countries,” cited the Vremya Novostei paper.

Meanwhile, the paper notes, “trying to catch up with developed countries” it is necessary to distinctly see the stages of the “chase”.

To begin with, Russia will have to liquidate the “not disastrous, but steady gap separating Russia from Eastern European countries, such as Poland.” Then, Russia will have to achieve the level of the “least developed countries of the European Community, like Greece and Portugal.” Only after that, Russia may start thinking of achieving the level of the most developed western countries.

Unfortunately, Vremya Novostei stresses, all forecasts, both Russian and western are tightly tied to oil prices in the world, for instance, the forecast of the International Monetary Fund about 5.6% annual industrial growth from 2006. As a result, in these terms objective reference marks for Russia will be not developed countries, but Iraq, Saudi Arabia, and Venezuela.

From the standpoint of the Nezavisimaya Gazeta paper, the modesty of the governmental economic forecasts is easy to explain, “the cabinet of ministers still hopefully looks at the “oil sea”, the weather on which now little depends on Russia and OPEC countries, but on the political situation in the world, which is determined by the US.”

Of course, the government will eagerly fulfill the Kremlin’s requirement and will present a much brighter forecast for the future. However, to realize such prospects, the authorities will have to cardinally reform the economy – and the paper notes that the present government is unable to do this.

According to Nezavisimaya Gazeta, the obvious crisis of the state “top management” makes the necessity to replace the government more evident. Thus, the open presidential dissatisfaction is the first sign of possible dismissal for head of the cabinet of ministers Mikhail Kasyanov.

The Vedomosti paper reports the rumor has had it since the end of winter that the president is dissatisfied with the work of the government. They say, then Putin rejected the edition of an address to the Federal Assembly, suggested by liberal speech-writers.

At the same time, today the government admits that the suggested medium-term option for development of the country is far from being perfect. As deputy head of the governmental apparatus Aleksey Volin said in his interview with Vedomosti, “the economy stopped developing by inertially, now we need radical changes.”

On the other hand, head of the Economic Analysis Bureau Yevgeny Gavrilenko noted, that the government needs political support to carry out reforms, “The main objective now is to reform the state. It is impossible to involve such a powerful development source as entrepreneurs’ initiative without a radical reduction of the state apparatus. This means, that neither the de-bureaucratization campaign, nor supporting of small businesses will yield any fruit.”

Meanwhile, Vedomosti concludes, the administrative reform is a presidential not governmental prerogative.

Famous political scientist, an expert of the Moscow Carnegie Foundation Lilia Shevtsova said in her interview with the Kontinent weekly that today’s economic stability in Russia bases on three things.

First, it is traditional in Russia “modernization from the top”, which all Russian reformers from Peter the Great to Pavel Kosygin used in the country.

Second, it is existence of large financial-industrial groupings, which suppress small businesses and private initiatives.

Third, it is orientation on resource exports.

Undoubtedly, this system is hopeless for the country: such market economy cannot provide for development, as it does not base on private initiative. On the other hand, it is apparent that economic freedom cannot exist without political freedom, which is an issue in Russia.

Meanwhile, according to Ms. Shevtsova, despite its hopelessness, the present system may exist extremely long.

“Probably, there will be no default in Russia if oil prices do not fall lower than $15 per a barrel, if pensions and salaries are paid, and if the living standard of the population will not exceed the level of “survival” and “may it be no war”, which is typical for Russians.”

On the other hand, of world oil prices sharply fall, the state system will have to be dismounted, and then the only hope for the society will be the next generation of rulers. “These people developed in Gorbachev’s and Yeltsin’s times…. They did not know monarchic or Soviet systems. They are free people, they are a generation without fear,” says Shevtsova.

So far, according to sociological polls, about 45% of Russians believe they live completely independent, without any influence from the state or the authorities. Another 30% of respondents ignore the state, which means that the power and the society in Russia are developing parallelly, without crossing. Perhaps, “people support Putin because Putin as well as Yeltsin allows people and the society to live as they are.”

Such a gap between the power and the population would be disastrous for any other country and system, while it is almost a norm for Russia, “We can breathe freely only when the authorities are not interested with us.” Approximately 65% of Russians believe they have achieved or almost achieved this, except for communist supporters, who dream of state paternalism.

Lilia Shevtsova calls this position the “ideology of not giving a damn”. And this ideology justifies, or at least makes easier to understand, the present willingness of Russian citizens to make money from anything, even frp, a statue of Stalin in the land of the exiled.

The Carnegie Foundation analyst believes this approach will not change as long as the state exists in its present form: “With 1,800,000 officials making up work for themselves, work which has nothing to do with the interests of society.” This statement is also the answer to the prospects of reforms in Russia: 1,800,000 bureaucrats is a tremendous army, and the outcome of its fight with any government it dislikes is easy to predict.

Meanwhile, the Gazeta paper reports that Iraq’s oil embargo “as a protest against Zionism and aggression of the United States” has caused the price of Russian Urals oil to rise to $25 a barrel.

We note: this is one dollar more than the prices factored into the 2002 federal budget, so we may temporarily forget all our problems and troubles.