SOURCE: The St. Petersburg Times
DATE: Issue #786 (51), Tuesday, July 16, 2002
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TITLE: City Handed a Very Pricy Reputation
AUTHOR: By Claire Bigg
PUBLISHER: Staff Writer
TEXT: A shirt, a cup of coffee or a taxi ride costs more in St. Petersburg than in London, Paris, or Berlin, according to a survey released last week by Geneva-based Mercer Human Resource Consulting.
Among the 144 cities covered in a world-wide cost-of-living survey carried out by Mercer, St. Petersburg ranks as the eighth most expensive city in the world and the second most expensive in Europe, trailing only Moscow.
Hong-Kong tops the list as the world's most expensive city, immediately followed by Moscow. Tokyo, which was last year's most expensive city worldwide, ranks third, followed in order by Beijing, Shanghai, Osaka, New York, St. Petersburg, Seoul and London.
"Our research is carried out from the perspective of expatriates who are sent abroad by their companies, and who want to maintain the same living standards and modes of consumption as in the West," said Marie-Laure Sepede, senior researcher at Mercer, in an interview on Monday.
Consequently, the cheapest unfurnished one-room appartment in St. Petersburg rents for $1,250 monthly, a medium-priced lunch for two costs $80.68, and a taxi ride from the airport goes for $47.46.
"The list of items quoted by the survey is composed exclusively of imported goods, and therefore does not reflect local consumption," Sepede says.
But, even if one adds up Russia's substancial import taxes and transportation costs to the price of Western products, the survey's estimates for St. Petersburg still appear disproportionately high.
"Renting a one-room flat for $1,850 is very expensive. Anybody here can find something cheaper, even Western-style with a satellite dish," said Tom Stansmore, manager of the Deloitte & Touche's Moscow office, who recently moved to Moscow after working for four years in St. Petersburg.
And Stansmore says that a large number of the prices for goods and sevices listed in the report, such as the $199 cost listed for a high-quality white cotton shirt, simply don't jive with his experience.
"This is crazy! If I wanted to splash out on a nice shirt, I would spend a maximum of $50. The results of this report are wrong, inaccurate and misleading," Stansmore said. "The survey is outrageous, and reflects a typical Western mindset. There is nothing wrong with local foodstuffs, for example. You can find very high-quality products on Russian markets. And it will certainly cost you less than imports."
The report's high figures are, to a large extent, explained by the choice of stores and venues selected for the survey, where the customer, in addition to the price of the product, pays for the prestige of the location or the reputation of the shop.
Prices for food are quoted from Dieta, Passazh and Kalinka Stockman, all upscale venues, while prices for clothing are quoted from Gostiny Dvor, Passage and the Machivelli boutique.
Passazh, which is usually named by most St. Petersburg inabitants, including expatriates, as one of the city's most expensive place to shop, is described in the report as a "typical department store." Beerstube, a bar located in the Nevsky Palace hotel, ranks as "good or typical."
Quoting prices in dollars also affects the results of the survey, due to the important difference in inflation between the dollar and the ruble.
"Next year we will quote prices in dollars as well as in rubles," Sepede said.
Mercer itself admits that the survey's estimates are overrated, and that expatriates' modes of consumption have changed since the early 1900s.
"In St. Petersburg, we have noticed that the cost of a good lifesyle has dropped in the past few years, although this tendency is still stronger in Moscow. Many international companies have entered the Russian market and opened factories producing Western-quality goods, which end up being much cheaper than imported ones. The quality of housing and local products is generally increasing - this is why we are considering changing our methods of research for Russia," Sepede said.
If Mercer begins including at least some locally-produced goods in its list of sample-items for the next survey, the results are likely to convey a more accurate estimate of the cost of life for expatriates in Russia.
TITLE: Tolstoy House a Trailblazer - and a Relic
AUTHOR: By Douglas Birch
PUBLISHER: the baltimore sun
TEXT: At the Tolstoy House, a luxury apartment building on the Fontanka River, the socialist system may be dead, but the class struggle lives on.
A Communist-turned-entrepreneur who owns a sprawling $600,000 apartment uses Marxist jargon to complain about the messy "lumpen proletariat" among his low-income neighbors, who live in single rooms, sharing kitchens and baths in the building's communal apartments.
A working mother, whose family of four once squeezed into one room of a cramped communal flat, denounces what she calls the building's wealthy "New Russians" for parking their Mercedes-Benzes in the courtyard, where children used to play.
A grandmother squabbles with one of the three other families sharing her communal apartment as they clash over chores, water on the bathroom floor and use of the common phone.
"These are the kinds of perfectly senseless conflicts that are going on in my apartment," she sighs.
Communal apartments - kommunalki - linking families with anywhere from three to dozens of other people sharing a kitchen, bath and toilet, were inspired by a post-revolution housing shortage in Russia, contempt for private property and a desire to attack the bourgeoisie by forcing them to share their apartments with workers.
They were the scene of epic squabbles and legendary discomfort. Millions of Russians lived in them. President Vladimir Putin grew up in one. And they became a central symbol of the folly and failures of Soviet society and its ideals.
Yet 10 years after the fall of the Soviet Union, kommunalki stubbornly survive in Russia's major cities, especially St. Petersburg, where about 700,000 of the city's 4.5 million residents still live in state-owned communal housing.
Built between 1910 and 1914 by a relative of the author Leo Tolstoy, Tolstoy House - a complex of eight-story Style Moderne buildings - is one of the city's most prestigious addresses. Its wealthy residents fled, were crowded aside or arrested after the October Revolution of 1917, and the new Soviet authorities doled out their apartments to workers tens of square meters at a time.
After the Soviet Union collapsed in 1991, the government allowed tenants to claim ownership of their communal apartments and sell or trade them. During Russia's roaring economy in the mid-1990s, tycoons bought kommunalki in central St. Petersburg and converted them into huge apartments.
Then came the collapse of the ruble in 1998, and the pace of conversion slowed. Many ordinary Russians saw their savings and pensions wiped out. They found themselves stuck in their communal flats, where they still pay rent of about $13 a month for a single room. The result? In many buildings here, Russia's capitalist present coexists uneasily with its socialist past.
Yevgenia Petrova, a 45-year-old lighting specialist with the Mussorgsky Theater, moved into one room of a five-family kommunalka in Tolstoy House with her husband in 1980, sharing the place with as many as 15 people.
Her two children were born there. For a while, her son slept between a cupboard and the wall. Her marriage collapsed.
"We divorced because it was impossible to live properly," she says.
Luckily for her, a neighbor died and Petrova was able to acquire a second room. Today, hers is one of four families - eight people altogether - who occupy the apartment.
As in many communal apartments, the public spaces in Petrova's - the halls, kitchen, bath and toilet - are dirty, dingy and dimly lit. But some of the battered doors hide tidy, refurbished rooms.
In a typical communal apartment, adults sleep on a fold-out couch, children sleep on cots, there's a small wardrobe for everyone's clothes, a bookcase, a folding table for meals and often a refrigerator.
Although she lives at one of St. Petersburg's most fashionable addresses, Petrova would like to move. One unemployed family in a nearby communal apartment tosses its garbage out the window, letting it rot on the roof of a neighboring garage. Then there are what she calls her snobbish neighbors, who fill her apartment with exhaust fumes when they start their expensive foreign cars in the morning.
"They ignore the environment, and they ignore us."
Another family in the kommunalka, led by Maria Fedorenko, 78, is trying to buy out the other five residents and turn it into a private dwelling.
Fedorenko, who grew up in Siberia after her father was exiled by Josef Stalin, offered Petrova $8,000 for her two rooms. Petrova agreed, then reconsidered and is now demanding $14,000. Tensions rose.
"We quarrel," says Petrova. "We have a lot of small conflicts, which, like a snowball, grow and grow."
Fedorenko went to the bathroom a few days ago and came out looking for Petrova. "Why do you put so much water on the floor?" she demanded. "Why don't you clean it up?"
Petrova shot back that Fedorenko failed to clean the bathroom the week before, as she was scheduled to do.
Of course she didn't clean the bathroom, Fedorenko replied. The city had shut off the hot water, as it does every summer for about a month.
"I will wait until there is hot water!" she said.
Petrova fumes that Fedorenko and her family "are always unhappy that there is too little space for them. They feel that [since] they bought a room, they bought all the other communal rooms, too, and consider [the entire apartment] their private property."
Fedorenko is likewise indignant about Petrova. "She shows no respect for my age," she says.
The wealthy Russians who are gradually buying up the apartments at Tolstoy House have their own complaints. Slim, dark-haired Sergei Marfin, 40, was a young Communist Party member and mining engineer in Siberia in the 1980s. Today, he is the owner of two factories and a restaurant.
He acquired an 11-room kommunalka in Tolstoy House three years ago by purchasing apartments elsewhere for its five families and moving them out. Then he hired an interior designer who spent 18 months rebuilding the 610-square-meter apartment from floor to ceiling.
The result is a vast, airy and ultramodern apartment that Marfin shares with his wife and two infant daughters. He has a sauna and whirlpool, a playroom, and a built-in espresso machine in the kitchen. He estimates that the apartment is worth $600,000.
He says that there is tension between the wealthy residents and some old-timers, especially those he calls "lumpen proletariat," a Marxist term that means the undeserving poor.
"I'm always after those who throw garbage into the staircase," he says. "I pay a person to clean the staircase from my own pocket. And some people, they do not care."
Marfin predicts that all of Tolstoy House's communal apartments will be gone in six years. He won't be sorry.
Alexandra Grigoreva, 17, one of Marfin's neighbors, is anxious to leave. She lives in a sparsely furnished cubicle in a five-family communal flat. The tall, red-haired student, who is studying to work in the printing business, has lived her whole life in this kommunalka. It has sometimes been an ordeal.
The kitchen is crowded at mealtimes, especially on holidays, when residents entertain. The bath and toilet are always occupied. Many of the walls are made of plywood, and tenants overhear one another. For several years, one of her neighbors beat his wife every weekend. The victim's screams echoed through the flat.
"We would lock the doors and stay in our rooms," Grigoreva says.
Grigoreva's family and the three others in the apartment have signed an agreement with a real estate agent. If the agent can sell the place for $115,000, she'll buy individual apartments elsewhere for the current residents. It would be the answer to Grigoreva's prayers.
"In your own apartment, it is all your own," she says. "Here, nothing belongs to you."
Not everyone at Tolstoy House, though, is eager to escape communal living. Valentina Makhmadova, 77, lives on the third floor of what may be one of the largest communal apartments in St. Petersburg. Ten families, more than 30 people, live in a dozen rooms off a single hallway. They share two bathrooms, though each room has its own tiny kitchen.
Unlike many communal apartments, there is no discarded furniture, trash or peeling wallpaper in the common areas. Astonishingly, several residents say they get along.
"We never quarrel," says Makhmadova, a blockade survivor.
Makhmadova's communal apartment is probably too big for any single person to buy: There would be too many people to relocate. But change is coming to her flat, too. Workers are installing a new kitchen and separate bath in one of the smaller rooms. A real estate agent plans to rent it for $40 a night to Western tourists and business executives.
Some of the old-timers at Tolstoy House welcome their wealthy new neighbors.
Painter Alla Brouchina, 42, doesn't live in the complex but owns a studio on the eighth floor of one of the buildings. It was given to her, free of charge, by the artists union. She sees the changes in Tolstoy House every day on her way to her studio. And she's impressed.
"The New Russians, they make the apartments beautiful," she says. "They do a useful job. They repair doors, they put down carpets, they fix things up."
TITLE: Diplomats Lectured On Foreign Policy
AUTHOR: By Andrei Zolotov Jr.
PUBLISHER: Staff Writer
TEXT: MOSCOW - Having summoned all of his ambassadors to Moscow, President Vladimir Putin on Friday explained his new pro-Western foreign policy and laid out his vision for a more modern and economically savvy diplomatic corps.
Formally dedicated to the Foreign Ministry's 200th anniversary - in 1802, Tsar Alexander I for the first time called the foreign service a "ministry" - the meeting of more than 130 ambassadors at the ministry was more than just an office party.
The only previous time a similar meeting was called was in 1986, when Soviet leader Mikhail Gorbachev appointed Eduard Shevardnadze as foreign minister and the policy of bringing the Cold War to an end was inaugurated. The last Soviet foreign minister, Boris Pankin, said in an interview Friday that the 1986 meeting brought a "turning point" in Soviet foreign policy.
Putin re-oriented Russia's foreign policy in reaction to the Sept. 11 attacks, and the new pro-Western stance has been a hard sell to the country's military and diplomatic establishment.
He told the ambassadors Friday that the new, closer relationship between Russia and the United States was the result of a "new reading of both countries' interests and a similar perception of the very character of modern global threats."
This does not mean that diplomats should not defend Russian interests more vigorously, particularly in business, where diplomats could learn from their foreign colleagues, he said.
"You should not be ashamed [of lobbying for the country's economic interests]," NTV television showed Putin saying in his 25-minute speech, in a departure from the prepared text. "You know how your colleagues behave in this regard in many countries including Russia: very persistently, to choose my words carefully, sometimes even trespassing on the limits of diplomacy."
To help promote Russia's economic interests abroad, a plan is being developed to transfer Russia's trade representative offices, currently branches of the Economic Development and Trade Ministry, to the Foreign Ministry and turn them into economic sections of the embassies, Putin said.
The ministry's anniversary has served as a news peg for a wide promotion of the country's foreign policy. Earlier this month, Foreign Minister Igor Ivanov appeared on ORT's "Vremena" current-affairs talk show, and last week a lengthy interview with him appeared in the Izvestia newspaper.
Continuing the PR campaign, Putin urged diplomats to improve their public relations. He said that the Foreign Ministry was too closed to the media and that many important things diplomats do either go unnoticed or are criticized. "We need to explain our foreign policy moves in a competent, comprehensible and talented manner," he said.
Helping Russians in distress or businesspeople abroad also was declared a priority. "Many missions treat it as a peripheral issue," Putin said, castigating diplomats for "bureaucratic indifference" to the needs of their citizens. From now on, embassies would be judged by how well they helped Russians abroad, he said.
Putin said that Russia's diplomatic corps needs new faces and, causing many smiles in the audience, more women. "It is especially noticable in this audience that women get undeservedly little attention in the diplomatic service," Putin said. "The absence of the so-called weaker sex in our diplomacy may prove to be a weak spot in our foreign policy," he said.
Putin also highlighted the most important policy issues, including cooperation with CIS countries, integration into the decision-making process of the global economy and relations with the European Union.
Alexander Pikayev, political analyst with the Moscow Carnegie Center, said Friday that Putin's meeting with ambassadors was not ceremonial, but marked an important turn in foreign policy - if not in exactly the same revolutionary way as in 1986.
"Putin's turn in foreign policy is not welcomed by everybody," Pikayev said. "The time had come for the president to meet with ambassadors so that they better understand his foreign policy."
To widen their knowledge of their country and its needs, the ambassadors are now supposed to travel around Russia and meet with local government leaders and businesspeople.
TITLE: Moscow Ferry Carries Chechnya Message
AUTHOR: By Steve Gutterman
PUBLISHER: The Associated Press
TEXT: MOSCOW - A small but vocal political group that opposes the Russian government's war in Chechnya used a riverboat Monday to deliver an anti-war message to its direct address: the Kremlin.
Members of the Transnational Radical Party boarded one of the ferries that takes tourists on cruises along the Moscow River. As the boat chugged past the crenelated red brick wall of the Kremlin, they unfurled a banner calling for immediate peace talks between President Vladimir Putin and Chechen rebel leader Aslan Maskhadov.
There was no visible reaction from the Kremlin, where Putin's office is located, and the Kremlin press service declined to comment.
A Transnational Radical Party member, Andrei Rodionov, said that the action was meant to "draw society's attention to the need for an end to the war in Chechnya through peace negotiations." The banner read "Putin-Maskhadov negotiations immediately."
The group chose Monday to deliver its message because Maskhadov sent a letter to Putin last month offering to suspend fighting on July 15 and revive peace talks, Rodionov said.
At the time, Defense Minister Sergei Ivanov rejected the idea, saying negotiations with Maskhadov "are possible only if he comes with his hands up and if the talks are conducted by a prosecutor."
Only one attempt at negotiations has been made since the current conflict began in 1999: In November, a Putin envoy met with a Maskhadov representative. Putin's envoy said afterward that the meeting was unproductive because the Chechens refused to accept the Kremlin's main condition - that the talks concern only the rebels' disarmament and not Chechnya's political status.
Putin has repeatedly asserted that the war in Chechnya is essentially over. However, Russian troops and Chechen police are killed almost every day in rebel attacks, and human-rights groups have accused the military of torture, killings and other abuses of Chechen civilians.
On Monday, gunmen attacked administrative buildings and the homes of several police officers in the town of Achkhoi-Martan, killing at least three people and wounding five, an official in the Russian-backed administration of Chechnya said. Three Russian service personnel were killed and one wounded in other attacks during the previous 24 hours, the official said.
Many Russians still support the war, but as the fighting drags on, opposition has mounted.
"Our president is acting against the wishes of the Russian people," Rodionov said.
TITLE: Conservatory Investigation On Hold
PUBLISHER: The St. Petersburg Times
TEXT: The section for the investigation of organized crime in the Interior Ministry for St. Petersburg and the Leningrad Oblast has put a criminal investigation of Vladislav Chernushko, the rector of the Rymski-Korsakov Conservatory in St. Petersburg, on hold, Interfax reported on Monday.
The reason for the decision was that Chernushko, aged 67, was suffering from bad health, Julia Bogatyrova, an investigator with the Interior Ministry said, according to Interfax
Bogatyrova said that a criminal investigation on the activities of Tatyana Krasavina, the chief accountant for the regional social charity fund operated by the conservatory, will continue, adding that she hopes the investigation will be completed and "all materials handed over to court sby the end of the year," Interfax reported.
The investigations of Chernushenko and Krasavina were both launched on March 31, 2001. Chernushko is being investigated for negligence and Krasavina for fraud.
TITLE: New Pipeline Plan Certain of Approval
AUTHOR: By Angelina Davydova
PUBLISHER: Special to The St. Petersburg Times
TEXT: Analysts believe that the BTS, or Baltic Pipeline System, will allow Russian exporters to avoid shipping oil through the Baltic states and will significantly cut transportation costs.
The first phase of the BTS project has already been implemented by Baltneftprovod - a pipeline-construction company - with the renovation of the Yaroslavl-Kirishi pipe, which connects an oil-refining plant in the Leningrad Oblast; the construction of a new Kirishi-Primorsk pipeline; and a new oil terminal in Primorsk. The first phase was completed at a cost of $460.2 million.
The second phase will involve the construction of specialized pipe-cleaning systems across 258 kilometers and three new oil-pumping stations in the Tver and Novgorod oblasts and in Sestroretsk, just north of St. Petersburg. BTS-2 will allow an extra six million tons of oil to be shipped per year, bringing the total for both sections of the pipeline to 18 million tons per year.
According to Viktor Alexandrov, general director of Baltneftprovod, speaking at a press conference last week in St. Petersburg, the company, along with Alfa Bank, will invest $334 million in BTS-2.
The main stage of the BTS project, however, is to be BTS-3, according to Alexandrov. "It will require several times more investment, but it will raise the total shipping capacity to 30 million tons per year," he said. "Construction won't be completed before the summer of 2005."
TITLE: Russia Turns U.K. Down on Iraqi Oil
AUTHOR: By Edith Lederer
PUBLISHER: The Associated Press
TEXT: The British proposal would change the current system of pricing Iraqi oil at the end of every month to allow companies on a "Green List" advance notice of prices.
UN officials, Iraq and Russia blame the delayed pricing policy for a 25 percent drop in Iraqi oil exports this year, which has created a revenue crisis for the oil-for-food humanitarian program.
Russia's Deputy UN Ambassador Gennady Gatilov indicated Friday that a Green List, which might exclude fly-by-night traders, would discriminate against Russian firms.
Russia has "substantial concerns on grounds of discrimination if this Green List is adopted," Gatilov said. "The criteria which are suggested are not acceptable to us."
The British proposal seeks to tighten controls on the more than 1,000 oil companies from some 83 countries that are currently registered with the United Nations to purchase Iraqi oil through the oil-for-food program. Russian companies dominate the Iraqi oil trade.
Under the British proposal, a dual system for pricing Iraqi oil would be created: Traders on a Green List would be told the price of Iraqi crude before it was loaded, while non-listed companies would continue to learn the price after they had already picked up the oil.
Proceeds from Iraqi oil sales are the main source of revenue for the 5-year-old oil-for-food program which was started to alleviate some of the suffering of Iraqi civilians living under sanctions imposed on Iraq after its 1990 invasion of Kuwait. It allows Iraq to sell unlimited quantities of crude oil to purchase food, medicine and other humanitarian goods.
The vast majority of companies that currently purchase Iraqi oil are little-known oil traders that Western diplomats contend are more inclined to pay kickbacks to Iraq than larger, more established international oil companies.
The problem began in late 2000 when the Iraqi government introduced illegal surcharges as high as 50 cents on every barrel of oil as a way of partially circumventing UN control over its only source of hard currency.
Since October, at the insistence of the United States and Britain, the Security Council committee monitoring sanctions against Iraq has set oil prices at the end of every month - rather than the beginning - to prevent Iraq from taking advantage of fluctuations in the oil market to impose an illegal surcharge.
The support of Russia, Iraq's closest ally on the Security Council, is key to agreement on any new pricing policy.
TITLE: Power Struggle at Slavneft Finally Concluded - Maybe
AUTHOR: By Anna Raff
PUBLISHER: Staff Writer
TEXT: Neither the ministry nor Slavneft was available for comment, but Interfax reported that the ministry's investigative committee decided that the actions of current Slavneft president Yury Sukhanov and vice president Dmitry Perevalov did not harm shareholders, which include the government, which has a 75-percent stake.
"We have found that, in fact, no crime was committed," a source in the investigative committee told Interfax.
In April, the ministry's economic crime department launched a criminal investigation based on a State Audit-Chamber report, which claimed that from 1999 to 2000, a Slavneft subsidiary artificially pushed down revenues using illegal transfer-pricing schemes.
Several market watchers have called the charges against Sukhanov politically motivated. His battle with the Interior Ministry was one of many fought against the backdrop of the power struggle for the oil company.
Slavneft, Russia's eighth-largest oil company in production terms, is scheduled to be privatized later this year and a number of companies have declared their intent to participate. The company posted $1.8 billion in revenues last year, compared with the $10 billion raked in by industry leader Yukos.
Sukhanov's fight for authority at the company, against both former president Mikhail Gutseriyev and Gutseriyev's heir apparent, Rosneft Vice President Anatoly Baranovsky, played out as a power struggle between factions representing Prime Minister Mikhail Kasyanov and President Vladimir Putin.
Voting the government's stake, Kasyanov ushered Sukhanov into the presidency. Gutseriyev is believed to be supported by Mezhprombank and its founder Sergei Pugachyov, whom media reports tie closely to Putin.
The fight for Slavneft has, literally, been fought on the streets.
In the past two months, both Baranovsky and Gutseriyev have stormed the company's headquarters on Pyatnitskaya Ulitsa.
TITLE: Kuwait in Russia on Arms-Shopping Trip
AUTHOR: By Lyuba Pronina
PUBLISHER: Staff Writer
TEXT: MOSCOW - Officials from Kuwait's Defense Ministry were in Moscow last week to discuss acquiring weapons, including Smerch multi-launch rocket systems, BMP combat infantry vehicles and an Il-76 cargo plane.
The 18-strong delegation expected to conclude a round of talks with Rosoboronexport, the state arms-exporting agency, on Friday, Brigade General Hamed Al-Qallaf, head of the delegation, said in an interview late Wednesday.
"We will complete discussion on Smerch, BMP-2 and BMP-3 and the aircraft," Al-Qallaf said.
Al-Qallaf said that a contract could be signed after the visit "If we decide this equipment is good and we must use it."
The delegation arrived in Russia on July 1 and spent two days in the Ural Mountains city of Nizhny Tagil, site of the third Russian Expo Arms-2002.
The exhibition was organized for Russian arms companies to show off a variety of tanks, combat vehicles and ammunition to potential clients, including foreign armed forces.
Posing in front of the upgraded Smerch system prior to the show's official opening Tuesday, Al-Qallaf told reporters that the word "good" does not describe Russian weapons well enough, and it would be better to use the word "excellent."
Al-Qallaf said that he was pleased with the firepower demonstration at the show. "We saw good things about the Smerch launcher," he said.
Al-Qallaf refused to detail the number of items that Kuwait is looking to buy, or the overall value, saying only that the weapons would make a welcome addition to other Russian weaponry in the Kuwaiti armed forces.
Kuwait was the first foreign country to buy the Smerch system, reportedly receiving 27 of the launchers between 1995 and 1996. At the time, media reported that, together with an unspecified number of BMP-2 and BMP-3 combat infantry vehicles, Kuwait paid some $800 million.
Algeria later bought 18 Smerch systems. The price of that deal has not been revealed.
The Smerch is made by the Perm-based Motovilikhinskiye Plants and has been in use by the Russian armed forces since 1987.
A spectator at the arms exhibition was injured Wednesday during a demonstration firing of the Smerch system.
Al-Qallaf said that Kuwait was looking at the upgraded version of Smerch, whose firing range has been increased from 40 kilometers to 90 kilometers.
During Soviet times, Kuwait purchased the Strela air-defense missile and Luna tactical-missile systems, Al-Qallaf said.
He also said that Kuwait has met with the Ilyushin aircraft maker and is looking to get an Il-76 military cargo plane.
Al-Qallaf added that Kuwait is not yet considering Russian tanks or fighter jets.
Despite the possible new purchases, Kuwait is unlikely to become a major Russian weapons client since the United States remains its main supplier, said Konstantin Makiyenko, deputy head of the Center for Analysis of Strategies and Technologies, an independent defense think tank.
Makiyenko said it would be a much more substantial deal if Kuwait were to purchase Russia's Buk-M1 and Tor-M1 anti-aircraft missile systems.
Kuwait is also believed to be looking at the S-300 air defense systems.
TITLE: Pace of Industrial Growth Slackening
AUTHOR: By Victoria Lavrentieva
PUBLISHER: Staff Writer
TEXT: MOSCOW - Industrial production rose 3.2 percent in the first half of 2002, down from 5.5 percent in the same period last year, according to State Statistics Committee data released Friday.
Production of nonferrous metals and oil grew well above average, rising 9.7 percent and 8.4 percent respectively, while the food industry followed close behind at 8.2 percent. Growth in ferrous metals, machine building and light industries, however, remained below 1 percent.
Industrial production did show a slight boost in June, growing 4.4 percent compared with the same period last year and 2.4 percent compared with negative growth of 1.7 percent in May.
Industrial production accounts for the lion's share of Russia's gross domestic product, which the government is expecting to grow 3.4 percent this year.
President Vladimir Putin has repeatedly called on the government to be more ambitious in developing the economy, saying that GDP must grow more than 5 percent annually in order for Russia to have a chance of achieving the living standards of even the poorest Western countries. GDP growth fell to 5 percent in 2001 after growth of 10 percent in 2000.
Christof Ruhl, the World Bank's chief economist for Russia, said that Russia would not be able to achieve growth rates higher than 5 percent in the long term without massive investment.
"Future rates of growth will depend on ... investment," Ruhl was quoted by Reuters as saying at an international conference in London on Friday.
"You would have to increase the rate of investment way over 10 percent to get an output rise of over 5 percent," Ruhl said, adding that investment growth rates are actually declining.
But as most industries are now operating at full capacity, such growth can only be achieved with huge capital investments, he said.
The European Bank for Reconstruction and Development, addressing the same conference in London, said that one way for Russia to stimulate investment would be to reform its banking industry to entice more people to deposit their savings in banks.
A bill that would provide security for private deposits is expected to be put before the State Duma in its next session this fall.
Central Bank watchers have been encouraged by signs of banking reform since Sergei Ignatyev earlier this year replaced Viktor Gerashchenko, who staunchly opposed reforms and fought to keep the bank aloof from the government.
Putin on Thursday signed into law a bill that increases control over the Central Bank through a supervisory body called the National Banking Council, which is made up of Duma deputies and representatives from the government and the Central Bank.
Industrial Growth
Industry '02 H1 vs. '01 H1
Energy -2.2%
Oil 5.7%
Ferrous metals 0.6%
Nonferrous metals 9.7%
Chemical,
Petrochemical 1.9%
Machinery 0.9%
Light industries 0.3%
Food 8.2%
Source: State Statistics Committee
TITLE: Euro Rises As Dollar Buckles to Pressure
AUTHOR: By David McHugh
PUBLISHER: The Associated Press
TEXT: FRANKFURT, Germany - The euro surged above the benchmark of one-to-one with the dollar Monday, reflecting worries about the U.S. economy that helped lift the European currency to its highest value in 2 1/2 years.
The breakthrough gave a boost to the euro's supporters, but economists said that it was less a sign of new strength in Europe's economies than a milestone in the decline of the once-mighty dollar.
Huge U.S. trade deficits and the accounting scandals rocking Wall Street have had experts predicting the dollar's fall and the euro's eventual rise above parity, or $1, for weeks.
"It was about time," said Dorothea Huttanus, an economist at DZ Bank in Frankfurt.
The euro, which has gained about 15 percent in value since starting its rally in early April, hit parity at around midday Monday and later touched $1.0087 before easing.
A stronger euro means more expensive European vacations for U.S. tourists and higher prices for imported goods from French wine to German sports cars.
It also means higher prices for Russians, who widely keep their savings in dollars, and a higher foreign debt burden for the government. Economic Development and Trade Minister German Gref said earlier this month that Russia's debt grows by $100 million a year for every U.S. cent the euro increases against the dollar. He said import duties, which are calculated in euros, would help cover the difference.
From Europe's point of view, it helps keep inflation under control and makes it less likely that the European Central Bank will raise interest rates to control prices, a move that can hurt economic growth.
The euro has rallied despite an absence of encouraging economic news from the 12 countries using the currency. First-quarter growth in the euro zone was an anemic 0.3 percent, though most economists predict a pickup in the second half of this year.
Instead, the euro's rise has been driven by bad news from Wall Street, where stocks have fallen for eight consecutive weeks. On Monday, the Dow Jones industrial average fell again and was trading down 330.34 points, or 3.8 percent, at 8,354.19 by mid-afternoon in New York.
"It's still a dollar-negative story, not a euro-positive story," said Commerzbank economist Michael Schubert.
The euro's strength could also help its supporters blunt criticism that businesses - restaurants and bars, for instance - jacked up prices when euro cash was introduced in January. It could also improve the euro's image in Britain, Sweden and Denmark, which have stayed out so far.
But the stronger euro also cuts into the price advantage held by European exporters - often the industries that European countries, especially Germany, expect to lead their economies out of the doldrums.
Foreign investors kept the dollar high for years because they needed dollars to buy a piece of the U.S. stock market boom. That offset soaring trade deficits - Americans buy more from overseas than they can sell abroad - that tend to undermine a country's currency.
TITLE: Restructuring UES: What is the Motive?
AUTHOR: By Yulia Latynina
TEXT: SINCE Anatoly Chubais announced his plan to restructure Unified Energy Systems, or UES, the energy giant's stock has plunged in value. Its investors are unhappy. The government shouldn't treat their complaints as a cause for concern, however. Reforming any malignant monopoly is bound to reduce its share price, but it should also improve the market potential of the economy as a whole.
The real question is whether or not Chubais is primarily driven by market motivations.
UES was created in 1992, and from the very start the company was driven by political, not economic, imperatives. The unified energy grid was intended to ensure the unity of the country, while its far-from-transparent tariff policy was to generate ready cash for presidential-election campaigns. And, as always, in order to generate a single ruble for the elections, 10 had to be stolen and 100 squandered.
In the mid-1990s, the most well-connected factories across the country received energy discounts from their respective governors, while the least influential ended up paying twice the price for energy to cover the difference. No one wanted to part with all that money, of course, so rather than pay their energy bill in cash, many businesses tried to pay in kind after inflating the price of their products. The goods were then resold by some company belonging to the brother of the energy company's director.
The energy system itself got nothing in return and soon began to founder. In 1997, the "young reformers" raised the issue of reforming UES. In their view, the whole mess could be cleared up very simply by separating the grid itself, the heart of the monopoly, from the generating companies.
And then, in 1998, Chubais took over the reins at UES. Over the next three years, he replaced two-thirds of the company's thieving execs and increased cash receipts from 22 percent to 104 percent.
Earlier, Chubais took an unprecedented step. He bankrupted two particularly impudent regional freeloaders - the Krasnoyarsk and Novokuznetsk aluminum plants - by canceling their illegal energy discounts and adding the difference to outstanding bills.
In the lawsuits that followed, UES was for some reason represented by lawyers from Siberian Aluminum, which scooped up the plants in the end. And the plants' energy debts were mysteriously shifted to companies controlled by Siberian Aluminum. In short, an attempt to collect on outstanding debts turned into a run-of-the-mill property grab.
Chubais never again attempted to break up and redistribute enterprises in the favor of UES. Instead, he got the idea of restructuring the energy monopoly itself. But the restructuring plan put forward by Chubais as head of UES differed in several details from the plan he talked about as a young reformer. Previously, the idea had been that small energy producers would compete with one another. Now energy producers were not individual power plants, but 10 generating stations bundled together.
This bears an uncanny resemblance to the seven federal districts. The president is trying to curb the governors' excesses not by implementing democratic processes, but by relying on high-ranking satraps. Chubais, in exactly the same way, is trying to curb the excesses of the energy sector, not by bringing market forces to bear, but by creating a kind of superstructure above the regional energy barons.
No wonder Chubais' enemies saw his restructuring plan as a way to finance his own campaign for the presidency. They squealed to Putin, and a number of bills affecting the energy sector were removed from the Duma's agenda at the last minute.
Yulia Latynina is a journalist with ORT and writes for Novaya Gazeta.
TITLE: New Rules for Opening Your Business
AUTHOR: By Ruslan Vasutin and Anna Lobachenko
TEXT: UNTIL now, starting a business in Russia has been a tedious and time-consuming experience involving a plethora of procedures and registering bodies. All of this was supposed to change, however, with the arrival of the long-awaited Federal Law "On the State Registration of Legal Entities," which came into force on July 1, 2002, and has been clarified by several government regulations.
The new law introduces a simplified procedure for the state registration of companies and establishes that establishes that the tax ministry will be the only state registration body. The ministry will be responsible for keeping a Unified State Register of companies which, for a reasonable fee, can provide information on any registered company. Passport details and taxpayer ID numbers of individuals, however, will remain confidential, only accessible to authorized state bodies.
The new legislation also allows for cooperation between the tax authorities and former registering bodies, including the transfer of documents and data on previously registered companies to the tax ministry. This doesn't mean that previously registered companies won't have to undertake certain actions and apply to the tax authorities in order to comply with the new rules. Crucially, Article 26 of the new law calls for mandatory reregistration of existing companies with the tax ministry and establishes a 6-month transition period, which runs to December 31, 2002. By that date, companies will have had to re-register. To achieve this, companies will have to submit to the tax authorities - either directly or by registered mail - a notarized notification prepared according to the specific rules established by the tax ministry.
The tax authorities should subsequently issue a company with its new registration certificate and assign it a so-called "Main State Registration Number." It was expected that this "inventory" of companies would reduce the number of "one-day" firms that are now widely used in Russia to "pocket"' VAT and avoid paying other Russian taxes. However, this happy thought of the authorities will have a negative effect on regular, law-abiding companies, increasing their administrative costs.
There is no fixed timeframe within which the authorities must issue a new certificate. However, as initial registration of a company now only takes five business days or less, the authorities have said that the simpler procedure for registration and issuing of certificates shouldn't exceed this deadline. But don't get your hopes up - you don't need to be a prophet to work out that tax officers are not going to meet this deadline.
If an existing company fails to re-register in due time, the tax ministry may initiate liquidation proceedings in court. Although that procedure currently takes about a year, tax officials admit that they are working on speeding up the whole process. Although liquidating an entity that pays taxes might seem a bit harsh, experience indicates that failing to comply with the new rules will complicate the activities of other companies hoping to obtain a new registration number. Reorganization, restructuring or introduction of amendments to the founding documents of the company - in order to retroactively comply with the new rules of the amended Joint Stock Company Law, for example - will not be possible without re-registration having been carried out.
For 100-percent foreign-owned companies, the registration process has temporarily been put on hold due to uncertainties as to whether the former registering bodies will retain their authority in this context. On July 10, 2002, the Federation Council considered amendments to the Federal Law "On Foreign Investments in the Russian Federation." They are expected to shed some light on the registration procedure for 100-percent foreign-owned companies.
What is clear is that companies that are fully owned by foreign investors will have to go through re-registration by December 31, 2002, in order to avoid the risk of liquidation and, more importantly, to circumvent "hidden" regulatory issues arising from non-compliance with the new rules. With about 300 thousand companies currently existing in St. Petersburg and, bearing in mind the efficiency of the Russian tax bureaucracy, it would make sense for businesses to review their plans and start taking action now, without delay.
Ruslan Vasutin is a senior manager and Anna Lobachenko a senior lawyer with Ernst & Young in St. Petersburg.
TITLE: Convicting the Criminal 'Upperworld'
AUTHOR: By Gus Russo
PUBLISHER: the baltimore sun
TEXT: WITH all the hand-wringing about the cesspool that is Wall Street, a new arrival to the planet might assume that large-scale corporate corruption is something new. But not only is institutional fraud and wanton lawlessness as old as civilization, a case can be made that it is as American as apple pie.
Today's "upperworld" villains seem to be good students of history and, as such, must feel assured that their odds of going to the slammer are about as slim as Osama bin Laden inviting President George W. Bush out for a day at the mall.
Indeed, the nation's most effective lawbreakers have often been rewarded for their success.
It was not until a century after a cabal of entrepreneurs destroyed unions, bribed politicians, bombed competitors and poisoned Indians that academics dared even speak of "white-collar criminals" and "robber barons."
One can find scholarly tomes on the transgressions of so-called "legitimate" businesses, and even U.S. documentary television has occasionally dared to bite the hand that feeds it, quietly attempting to wake the sleeping giant.
For instance, PBS' "Frontline," recently estimated that corporate accountants have defrauded Americans of $200 billion in just the past 10 years.
What does this say about how the United States, as a society, chooses to enforce its criminal code? And how have the FBI and the Justice Department spent U.S. tax dollars? The answers are unsettling in the extreme and, in a logical world, would force a dramatic reappraisal of the American national ethos - regretfully, at a time when we are engaged in a deadly morality play with an enemy that questions our way of life.
While U.S. law enforcement agencies spent their budgets trying to bring down "the Dapper Don" or "Sammy the Bull," the country was being robbed blind, if not brought to its financial knees, by a class of criminal that has always been above the law.
Today's corporate thieves know that as long as their companies prosper, laws are irrelevant. As Henry Ford said, "We know that anything which is economically right is morally right."
When the entire weight of American justice succeeded in nabbing Al Capone for $215,000 in tax evasion (for which he was sentenced to 11 years), the richest man in the world at the time, J. Pierpont Morgan, quietly paid not one cent to the Internal Revenue Service. When confronted about this, the haughty mogul responded, "I owe the public nothing."
And while John Gotti's life in prison dominated New York's front pages for the last decade, the Wall Street plunderers, who were abusing infinitely more innocent victims, weren't even making it into the business section. A savvy, old Chicago bookie I spoke with calls such distraction "linguistic prestidigitation." It wasn't until the corporate accountants verged on collapsing the economy that anyone took notice.
When these "upperworld" bad actors were hauled before Congress last Monday, they predictably took a page out of the book written by their underworld counterparts, pleading the Fifth Amendment ad nauseum.
The sight of WorldCom's Bernie Ebbers straining to read the plea from an index card mirrored Sam "Mooney" Giancana's performance more than four decades earlier. Recent disclosures about Bush's questionable business practices makes one wonder if he should be preparing his own index card.
In order to extricate our politicians from the knee-jerk bed-sharing with the Enrons of the world, and hopefully redirect our G-men, I believe we might start with one of the most powerful tools in our moral arsenal: language.
By referring to car manufacturers who knowingly sell exploding gas tanks as "actuarial miscreants," or a gaggle of conniving accountants as "stock manipulators," we not only diminish the seriousness of their crimes but also our will to prosecute them. I suggest we apply the same verbiage to white-collar criminals as we traditionally have to first-generation immigrant lawbreakers: murderers, hoods, gangsters and racketeers.
It might even help if our business and crime reporters assign colorful nicknames to these pocket-lining CEOs to sustain our interest. It certainly worked with the non-WASP racketeers. To that end, I humbly offer the first suggestions for the wags' consideration: Bernie "The Beard'' Ebbers, Ken "The Boss" Lay, Sam "Martha's Boy" Waksal and Martha "Ma" Stewart.
Russo is an author and investigative reporter. His latest book is "The Outfit: The Role of Chicago's Underworld in the Shaping of Modern America" and he contributed this comment to The Baltimore Sun.
TITLE: AIDS: A Matter of Equality
AUTHOR: By Chalya Lar
TEXT: "ONE more day, please." It's a plea I hear every time I return to Africa, a plea from mothers dying of AIDS who need time to find someone to care for their children after they die.
And it's a plea that should have echoed loudly in the ears of each of the 17,000 delegates during last week's International AIDS Conference in Barcelona.
Over the six days of the conference, more than 49,000 people died of AIDS, most of them in Africa - and most of them women.
Addressing the problem of AIDS will require action, starting with substantial increases in aid from governments, businesses and private donors.
With less than $1 billion a year set aside to fight AIDS, the United States is making the largest contribution to combating the disease overseas of any country. But it is failing to exert leadership in what has been conservatively estimated as a $10-billion-a-year war.
Fighting AIDS also will require medical advances and innovative solutions for the care of an estimated 13 million AIDS orphans worldwide. And, perhaps the greatest challenge of all, it will require the empowerment of women.
A decade ago, I was on the front lines of this war, practicing medicine and epidemiology at home in Nigeria. My efforts to coordinate AIDS education were met with denial, dismissal, even charges that AIDS education was an American political strategy to discourage sex and stop the overpopulation of Africa. The church did not want me to speak about AIDS prevention; it would encourage premarital sex or infidelity. I was scolded.
The leaders of my community and my country did not take AIDS seriously. Wedding vows or prohibitions against premarital sex were ignored. Bound by culture, women could not ask their boyfriends or husbands about other lovers, let alone their HIV status. While these attitudes created professional challenges, they also forced a profound personal decision. I saw only one alternative to the risk of AIDS: remaining single and celibate.
It was a high price to pay.
But I have met countless women paying an even higher price for their husbands' infidelity.
Africa, home to 70 percent of the world's 40 million AIDS cases, is the only region where women with AIDS outnumber men. In sub-Saharan Africa, 55 percent of people infected with HIV/AIDS are women, compared with 20 percent in North America.
Since men often have many more sexual partners than women, a single infected male can spread the disease to dozens of women, who are physiologically more susceptible to the AIDS virus. Teenage girls are especially at risk, since their partners are usually more experienced and less monogamous. African women also are less able to dictate the terms of sex, including the use of condoms or other means of protection - a concept foreign to my American friends, who enjoy relative political, economic and sexual equality with men, a "peace benefit" of the sexual revolution and the women's movement.
Women's lack of power is a significant factor in Africa's AIDS crisis. So is poverty.
Husbands leave wives and children at home for work as truck drivers or miners. Away from their families, they find sexual release with prostitutes, who themselves are compelled by poverty to sell their bodies. When husbands return to their wives, they bring back more than a paycheck; they bring home this deadly virus.
But African women are not helpless. HIV infection rates in Uganda have dropped from 31 percent in 1990 to 8.3 percent in 1999. And women played a key role in this reduction. In response to an unprecedented public education campaign, women and girls practiced "zero grazing," or abstinence before marriage and faithfulness after. On averae, girls are holding on to their virginity a full year longer. And among women age 15 and older, the number reporting multiple sexual partners fell from 18.4 percent in 1989 to 2.5 percent in 2000.
AIDS has brought political and economic devastation to Africa that will be felt for this generation and at least the next. Long-term solutions must be rooted in communities and, specifically, women in those communities. Stopping the disease will require determined action by leaders and private citizens alike.
Chsyla Lar, an M.D., is the HIV/AIDS program specialist for World Vision, an international Christian humanitarian organization. She submitted this comment to the Baltimore Sun.
TITLE: Report Only Reinforces The Rip Off
TEXT: LAST week, Geneva-based Mercer Human Resource Consulting released its annual cost-of-living survey, which ranks St. Petersburg as the second most-expensive city in Europe, trailing only Moscow, which, in turn, trails only Hong Kong in the world rankings.
A press release informs us of the noble raison d'etre of the survey: "The information is used by governments and major companies to protect the purchasing power of their employees when transferred abroad."
Just to provide a taster, the 12-page report on St. Petersburg states that the cheapest unfurnished 1-bedroom apartment fit for expat habitation costs $1,250, while the payment of a two-month, refundable deposit is the norm according to a handy footnote. And if the price sounds a bit on the high side, try to guess who so magnanimously supplied the information: two St. Petersburg-based real estate agents (whose phone numbers are helpfully included).
Keep on leafing and you can learn more weird and wonderful things such as that the cheapest an expat can get a drink (including, of course, service) is $10.
And in the section on business travel expenses, we are told that a taxi ride "from airport to city" (presumably Pulkovo 2) will set you back $47.46 (there's obviously a $0.54 discount involved here, sparing travellers the expense of a more-easily negotiated round figure). But this time, there are no handy footnotes explaining that if you side-step the taxi mafia, you can get a perfectly comfortable ride for $10, and even less, if you can speak Russian.
Overall the report leaves itself wide open to accusations of being highly misleading and contributing to the ridiculously inflated prices that are a very real part of St. Petersburg and Moscow life.
While it may help to pad the housing allowances, hardship allowances and expense accounts of expat businesspeople and foreign diplomats, and while it certainly does a huge service to greedy real estate agents, restaurant owners and the taxi racket - it does an equally huge disservice to just about everyone else living in St. Petersburg and the capital (as well as to the taxpayer back home) by helping to sustain artificially high prices and reinforcing the status quo.
And it does precious little to protect the "purchasing power" of poor expat businesspeople and government employees once they arrive in either of the two cities from the numerous scams and rip offs that go on.
Meanwhile, for the average St. Petersburg resident, the news that their city has once been ranked the second most expensive city in Europe would no doubt be met with detached bemusement.
TITLE: A Decade Later, Not Too Much Good To Say
AUTHOR: By Boris Kagarlitsky
TEXT: FOR 10 years now, a chorus of politicians, journalists and sociologists has been telling the public a story as simple and appealing as the fairy tale about Little Red Riding Hood. The story goes like this: Society was deformed by seven and a half decades of life under the Communist regime. The public consciousness was warped in exactly the same way. And to the extent that a new life takes shape in Russia, that consciousness will change (according to the now much-reviled Karl Marx's famous thesis, existence determines consciousness).
To mark the 10th anniversary of the launch of reforms in this country, the Academy of Sciences' Institute of Integrated Social Research, together with the Independent Institute for Social and National Issues, summarized the results of sociological surveys conducted over the last 10 years. If the ruling elite and its ideologues have any interest at all in what their own citizens are thinking, they would do well to study this report.
Public consciousness has most definitely changed - in what direction is another matter. At the dawn of the reforms, more than 63 percent of Soviet citizens supported the idea of private enterprise, and were even prepared to give business a try themselves. Over the next 10 years, the number of people viewing business favorably dropped to 52.6 percent.
The poll results become even more interesting when you look at the issue of property rights. After 10 years of privatization, the public's attitude toward private property is significantly more negative than it was during the Communist era. In fact, the notion of renationalization is finding ever wider support. Sixty-three percent of the population now insists that the state should exercise exclusive authority over the housing sector.
The percentage of the population that supports the liberal market model has decreased steadily over the past decade, during which a series of revolving-door governments has been busily constructing that very market economy. In 1994, 12.5 percent of the population backed the model - a low number in itself, given the nearly unanimous support for this model among the ruling elite. Now, popular support for the liberal model has fallen to just 8 percent.
The most unpleasant surprise for the champions of Russian liberalism is that people's views on political and economic issues vary little with age. Sociologists note that the responses of 18-year-olds and 55-year-olds yield nearly identical results. Social status, not age, now seems to be the leading factor in determining people's attitudes.
Two-thirds of those polled consider Russian-style democracy to be mere window-dressing designed to conceal the authoritarian state beneath. It doesn't follow, however, that Russian society is incapable of achieving democracy. While the population overwhelmingly rejects liberal economics, it still gives strong support to such basic democratic principles as equality before the law (up from 54 to 83 percent), an independent judiciary (up from 41 to 46 percent), and so on.
It's no wonder that the majority rated the results of reform as unsatisfactory. And if our chief criterion for determining the success of reform is not loyalty to the system, but people's capacity to think critically and to draw their own conclusions despite the constant din of propaganda, then the polls paint a rather optimistic picture. Ten years have not passed in vain.
Boris Kagarlitsky is a Moscow-based sociologist.
TITLE: Global Eye
TEXT: Your Global Eye is repairing to a secure undisclosed location this week, undergoing all manner of privations - that Cheney guy is always hogging the bathroom, for one thing - to better serve our faithful readers. (All three of them.) But we leave you in good hands with not one but two special guest columnists.
Distant Echo
First, historian Edward Gibbon gives us a trenchant - not to mention extremely prescient - view of the American condition today, as the United States finishes celebrating the declaration of its now-extinct liberty on July 4, 1776. Take it away, Ed.
Their personal valour remained, but they no longer possessed that public courage which is nourished by the love of independence. Oppressed beneath the weight of their own corruption and military violence, they for a long while preserved the sentiments, or at least the ideas, of their freeborn ancestors. From Grecian philosophy they had imbibed the justest and more liberal notions of the dignity of human nature and the origin of civil society. The history of their own country had taught them to revere a free, a virtuous, and a victorious commonwealth; to abhor the successful crimes of Caesar and Augustus; and inwardly to despise those tyrants whom they adored with the most abject flattery.
As magistrates and senators, they were admitted into the great council that had once dictated laws to the earth, whose name gave still a sanction to the monarch, and whose authority was so often prostituted to the vilest purposes of tyranny. Tiberius, and those emperors who adopted his maxims, attempted to disguise their murders by the formalities of justice, and perhaps enjoyed a secret pleasure in rendering the Senate their accomplice as well as their victim.
By this assembly the last of the Romans were condemned for imaginary crimes and real virtues. Their infamous accusers assumed the language of independent patriots, who arraigned a dangerous citizen before the tribunal of his country; and the public service was rewarded by riches and honors. The servile judges professed to assert the majesty of the commonwealth, violated in the person of the first magistrate, whose clemency they most applauded when they trembled the most at his inexorable and impending cruelty. The tyrant beheld their baseness with just contempt, and encountered their secret sentiments of detestation with sincere and avowed hatred for the whole body of the Senate.
The empire of the Romans filled the world, and when that empire fell into the hands of a single person, the world became a safe and dreary prison for his enemies. The slave of Imperial despotism, whether he was condemned to drag out his gilded chain in Rome and the Senate, or to wear out a life of exile on the barren rock of Seriphus, or the frozen banks of the Danube, expected his fate in silent despair. To resist was fatal, and it was impossible to fly. On every side he was encompassed with a vast extent of sea and land, which he could never hope to traverse without being discovered, seized, and restored to his irritated master.
Beyond the frontiers, his anxious view could discover nothing, except the ocean, inhospitable deserts, hostile tribes of barbarians, of fierce manners and unknown language, or dependent kings, who would gladly purchase the emperor's protection by the sacrifice of an obnoxious fugitive. "Wherever you are," said Cicero to the exiled Marcellus, "remember that you are equally within the power of the conqueror."
Medium Rare
And now, Thomas Love Peacock, through the character of the Reverend Doctor Opimian in "Gryll Grange," casts a wary eye on the degraded state of modern journalism (present company excepted, of course!) - and the degraded realities that are its meat and drink.
If ever Hamlet's news "that the world's grown honest" should prove true, there would be the end of our newspaper. For let us see, what is the epitome of a newspaper? In the first place, specimens of all the deadly sins, and infinite varieties of violence and fraud; a great quantity of talk, called, by courtesy, legislative wisdom, of which the result is "an incoherent and undigested mass of law, shot down, as from a rubbish cart, on the heads of the people," as Jeremy Bentham says; lawyers barking at each other in that peculiar style of hylactic delivery which is called eloquence, and of which the first and most distinguished practitioner was Cerberus; bear-garden meetings of mismanaged companies, in which directors and shareholders abuse each other in choice terms, not all to be found even in Rabelais; burstings of bank bubbles, which, like a touch of the harlequin's wand, strip off their mask and dominoes from "highly respectable" gentleman and leave them in their true figures of cheats and pickpockets; societies of all sorts, for teaching everybody everything, meddling with everybody's business and mending everybody's morals; mountebank advertisements promising the beauty of Helen in a bottle and the age of Old Parr in a box of pills; announcements that some exceedingly stupid fellow has been "entertaining" a select company-matters, however multiform, multifarious and multitudinous, which have all been brought into family likeness by the varnish of false pretension with which they are overlaid.
Edward Gibbon is the author of "Decline and Fall of the Roman Empire." The first volume was published in 1776. Thomas Love Peacock, novelist and essayist, published "Gryll Grange" in 1861.
The Global Eye resumes its regularly scheduled programming next week. If Cheney lets us out, that is.
For annotational references, please see Global Eye in the "Opinion" section at www.sptimesrussia.com.
TITLE: Kashmiris Protest Inaction in Massacre
PUBLISHER: The Associated Press
TEXT: This came after India's leaders failed to respond as promised to a shantytown massacre that killed 28 outside of the Jammu city in Indian-held Kashmir. Up to eight suspected militants walked into the slum Saturday, threw grenades, and opened fire with automatic weapons, killing many women and children, witnesses told police. The gunmen escaped after trading fire with security forces.
A communal funeral was held in Jammu on Sunday for the massacre's victims, who were cremated en masse.
Shops, schools and colleges were closed in Jammu on Monday. There were no reports of violence stemming from the protest, which was supported by both members of government and opposition political parties.
Buses stayed off the roads and markets were deserted. Police and army soldiers guarded street corners and government buildings.
In New Delhi, the parliament adjourned Monday without the statement promised by Prime Minister Atoll Binary Vajpayee about Saturday's attack at Qasimnagar.
Indian soldiers hunting for the gunmen have widened their search of the Himalayan foothills near the shantytown where the attack occurred. Witnesses said that the militants fled into the densely forested hills in the dark of night.
No group has claimed responsibility, but police said that the attack was characteristic of Lashkar-e-Tayyaba, a Pakistan-based Islamic militant group.
The territorial dispute over Kashmir is at the heart of five decades of hostility between India and Pakistan, who have fought two wars over the territory.
TITLE: WORLD WATCH
TEXT: JERUSALEM, (NYT) - An Israeli F-16 warplane fired missiles at the home of a Palestinian militant in the Gaza Strip town of Khan Yunis on Monday after he escaped from the building. The missiles destroyed the three-story structure and wounded several people.
The attack set off pandemonium at a nearby Palestinian security building, where a suspected Palestinian informer was standing trial, and he was shot dead by relatives of those he was said to have betrayed to the Israeli security forces.
In the Israeli airstrike, the F-16, accompanied by Apache helicopters, fired at the home of Ahmad Youssef Abdel Wahab, a leader of the armed wing of the militant group Hamas. Wahab, apparently hearing the aircraft approaching, fled before the house was hit.
Violence Mars Vote
MANILA, Philippines (AP) - Voting for hundreds of thousands of local government positions in the Phillipines opened Monday, with 70 people killed since campaigning started, officials said.
Three people en route to voting died when gunmen opened fire on them on the remote island of Tawi-Tawi in the southern Philippines, a military report said.
Police also reported the death of Shimarie Mukamad, an 18-year-old candidate for a youth council in South Cotabato province, about 800 kilometers south of Manila. Villagers found her head almost severed from her body Sunday, police commander Bartolome Baluyot said.
Without explanation, the military brought down the number of assassinated candidates from 16 to five Monday afternoon, saying that elections had "generally been peaceful.''
State Recognition Plan
JERUSALEM (AP) - With a new round of Mideast diplomacy opening this week, Arab nations will present a plan calling for international recognition of an interim Palestinian state, followed by a two-year period to work out the final borders, a diplomatic source said on Monday.
The talks that open Tuesday in New York are an attempt to revive Mideast peacemaking that collapsed more than a year ago amid persistent violence, and will include diplomats from the United States, the United Nations, Europe, Russia, Egypt, Saudi Arabia and Jordan.
The Arab proposal, worked out in conjunction with the Palestinians, calls for Palestinian elections for a new leader and parliament in January as part of a broader reform effort, the source said.
Turkey PM May Resign
ISTANBUL, Turkey (AP) - Premier Bulent Ecevit said on Monday that he would step down if his economy minister is forced out.
Economy Minister Kemal Dervis offered his resignation last week, but was persuaded to stay on to avoid damaging Turkey's fragile economy.
Dervis has backed legislators who deserted Ecevit to form a new party. Dervis' support for the new party has enraged nationalists, the largest group remaining in the struggling coalition government.
Asked if he would step down if the nationalists insist on Dervis' departure, Ecevit told Turkish Milliyet newspaper in an interview: "Of course, it would be obligatory.''
Ecevit had previously said he would only resign if his government lost its majority in the 550-member parliament.
TITLE: Tribe Pounds Rivera In Six-Run Outburst
PUBLISHER: The Associated Press
TEXT: CLEVELAND, Ohio - For his first home run of the year, Bill Selby sure picked the right spot.
The Cleveland utility player, with all of 32 at-bats this season entering the game, jolted Mariano Rivera with a grand slam with two outs in the ninth inning on Sunday to lead the Indians to a 10-7 victory over the New York Yankees.
The shot to right field capped a six-run inning in the worst relief outing of Rivera's career.
"There was an electricity in the crowd that we just seemed to feed off," Selby said after the game. "We collectively just seemed to will a win against a great pitcher."
Rivera (1-4), who had never given up more than five runs as a reliever, grimaced as he watched Selby's home run land.
"There is nothing I can do, it is over," Rivera said. "This was a tough one. I just try to make pitches and sometimes it doesn't work that well. The pitch was where I wanted it. He hit my best pitch."
Selby almost beat Rivera one pitch earlier, but his liner down the right-field line was foul by a foot.
"Everybody just went crazy," said Omar Vizquel, who singled earlier in the rally and scored on Selby's shot. "The ball went foul and we were yelling, 'Oh, nuts, so close, why, why, why?' Then the next pitch is gone. Amazing."
In other American League games, it was: Toronto 6, Boston 5; Seattle 7, Tampa Bay 6; Baltimore 6, Oakland 3; Minnesota 5, Texas 4; Kansas City 12, Anaheim 3; and Chicago White Sox 6, Detroit 4.
In National League games, it was: Montreal 10, Atlanta 3; Colorado 5, San Francisco 3; Cincinnati 8, Houston 3; Chicago 10, Florida 3; St. Louis 4, San Diego 1; New York 4, Philadelphia 2; and Milwaukee 5, Pittsburgh 3.
Jim Thome hit a three-run homer in the sixth off Mike Mussina to cut the Yankees' lead to 7-3, and Vizquel made it 7-4 with a run-scoring single off Ramiro Mendoza before Rivera blew his second save of the series and fourth of the season.
Blue Jays 6, Red Sox 5.
Eric Hinske hit a winning homer in the ninth after connecting for a tie-breaking home run in the seventh as host Toronto beat Boston for the third straight time.
Hinske homered off Tim Wakefield in the seventh, and hit his 16th homer on closer Ugueth Urbina's (0-4) first pitch in the ninth.
Expos 10, Braves 3.
Wil Cordero hit a grand slam off Damian Moss (4-4) and had five RBIs to lead Montreal over Atanta before the third-largest Olympic Stadium crowd of the season.
With 25,109 on hand - only Montreal's third crowd over 20,000 this season - for a Tim Raines bobblehead promotion, the second-place Expos split the four-game series to draw within 9 games of Atlanta in the NL East.
Javier Vazquez (7-5) allowed two runs in seven innings.
TITLE: SPORTS WATCH
TEXT: PHILADELPHIA, Pennsylvania (AP) - As he awaited arrest on assault charges, Allen Iverson played host to an all-night party at his mansion, where guests swam and played basketball in the rain.
The $2.4 million house in Gladwyne had been quiet since the charges were filed Thursday.
But the party that started Saturday lasted through the night, and photographs show Iverson in a heated discussion with an unidentified older woman on the front step just before 5 a.m., as the party was breaking up.
Police, who have ordered Iverson to remain at home until his expected arrest Tuesday, kept tabs on the situation from outside the gate.
Philadelphia police filed warrants for Iverson's arrest the same day they searched the suburban mansion and towed off a Cadillac SUV, in which they found broken glass, rocks and blood.
The warrants charge that Iverson - armed and accompanied by his uncle, Gregory Iverson - went looking for his wife July 3 after a dispute and threatened two Philadelphia men at his cousin's apartment.
Wealthy Senator
OTTAWA, Canada (AP) - The Ottawa Senators signed captain Daniel Alfredsson to a two-year contract Monday.
The 29-year-old right winger led the Senators with a career-high 37 goals and 34 assists last season. He made $3 million after missing all of training camp last September in a contract dispute.
It was the second time in his career that he had missed training camp.
Reports had been circulating since Friday that the Sens and Alfredsson, a restricted free agent, had agreed to a deal worth $9.5 million.
Tough Choice
LONDON - Rio Ferdinand says that the decision to either stay at Leeds United or accept a possible 35 million pound ($54 million) move to seven-time premier league champion Manchester United is the toughest of his career.
The England center back said after a meeting with new Leeds manager Terry Venables on Sunday that he would make his decision on Tuesday, the Sun newspaper reported.
"I told Mr Venables I would give him a decision on what I wanted to do within 48 hours," he was quoted as saying in Monday's Sun.
"There are a lot of people I want to talk to about this. I will listen to what my family and close friends have to say and then make up my mind.
"This is a huge dilemma for me, one I have to get my head round.
Getting the Go-Ahead
MELBOURNE, Australia - Australia's Cathy Freeman will run at this month's Manchester Commonwealth Games in the 4x400 meter relay, the Olympic 400 meter gold medallist said on Monday.
Freeman, 29, was not expected to compete at Manchester after withdrawing from competition on May 30 following news that her husband Sandy Bodecker had throat cancer and was undergoing treatment in Melbourne.
Freeman said that Bodecker had urged her to run at Manchester.
"He knows me so well, he knows how passionate I am about my running," Freeman said in an interview on Australian television.
"It's such a big part of who I am. He encouraged me and said 'go for it, Cath', and that's it, really.