POTEMKIN PRIVATISATION
Robert Haupt finds out what
happens when Boris Yeltsin pays a visit to the supposed showpiece of Russian enterprise
Nizhni Novgorod COUNT POTEMKIN'S façades were built in the Crimea at a suitable distance from the short-sighted Catherine's horse- back route. Those of the Yeltsin era are closer to hand: the asphalt was still steam- ing over the potholes when the President arrived here in Nizhni Novgorod on the river-boat Rossiya the other day. But that only made the illusion more real.
'A Yeltsin visit is good for business,' said the man at the marble works, where demand for tiles had picked up so fast during the count-down to the presidential visit that in order to tell me about it he had to take the phone off the hook.
Over in Minin Square, an elephantine building that would form the backdrop to the presidential view, if he chanced to look that way, was being daubed with white- wash by a band of women in overalls and caps and with glinting gold teeth. They dribbled it over themselves, the windows and footpaths alike: never mind, the Presi- dent wasn't coming close. Steamrollers rolled, gardeners planted, sweepers swept and returned to sweep again. The owner of the big restaurant on Bolshaya Pokrovskaya stood beside his new front door, photographer positioned to snap him shaking the hand of the man who had made all this possible.
For Nizhni Novgorod, long said to be the most capitalist city in Russia, is a suc- cess. Margaret and Denis Thatcher, not to mention John Major, have all bought cheese at the Dimitrievsky shop, touted as the first privatised enterprise in Russia. It is good cheese, served in clean premises by staff who are courteous: in terms of habits, a big change for Russia. But, damn it, it is still only a cheese shop, and when one becomes the umpteenth foreign correspon- dent to hear its owners' testimony of their faith in privatisation as a transcendent good, one ends up muttering 'cheese', over and over.
The problem isn't privatisation, it's the faith put into it by Russians and their west- ern advisers alike as well as the way it is being carried out here. If a state business ends up with the same management as before yet with the chance to fire half its workers, renege on its debts, strip its assets and move the resultant funds offshore, pri- vatisation isn't a process, it's a word for theft. All the cheese in Russia won't change that.
The result of such 'privatisations' can be good for the workers kept on — free hous- ing, holidays and cheap food, as manage- ments share some of the spoils. One manager actually boasted to me that his workers received subsidised honey. And what of the workers dismissed, was there honey, too, for them? They were drunks and loafers, was the reply.
Everyone agrees that work has acquired a meaning in Russia. The days when jobs at the workbench were sought after, because by jamming your overalls into the vice you could sleep standing up, are over. And it's not just due to cheap honey: there is a down-side risk at last. Should you lose your job, or end up at one of the (mostly ex-mil- itary) behemoths that can't meet their pay- rolls, you and your family can fall very far, very fast.
The administration of Boris Nemtzov, Nizhni Novgorod's political boss and a Yeltsin ally, is full of Rotary Club types, but even these boosters had to acknowl- edge what was going on behind the city's bright façade last week with the publica- tion of an income survey. Forty per cent of families are on incomes below the mini- mum considered necessary to live on. Four per cent are earning less than is needed to buy the minimum amount of food. Con- sumption of meat was down to average lev- els last seen in the early Seventies, of dairy products levels last seen in the mid-Sixties. Incomes of the top 10 per cent of families were 16 times greater than those of the bottom (and you can bet that the disparity is greater than that). Statistics are a guide to the truth, not the truth itself, but these are supported by one piece of observable evidence. Here, as in Moscow, proud old ladies with kind faces have taken to beg- ging and to picking through the rubbish. Mr Yeltsin came to Nizhni Novgorod to inspect the results of Iconverte, the proce- dure by which factories such as the GAZ automotive works are trying to fill the gap left by the end of military production. There was a mobile crane that looked like an armoured personnel-carrier, a security truck that looked like an armoured per- sonnel-carrier and a cherry-picker that had been grafted on to . . . well, you have the picture. Over at the Mig factory, they're more candid: $25 million will get you a Mig-29. 'Buy in volume and we can start to talk about price,' said the marketing man as he handed me a T-shirt. It was embla- zoned with the corporate logo over the top-of-the-line Mig-31. 'Better than F-16,' he snorted. 'Ask the Germans, they've got both.'
Mig is in the process of privatising itself. Other military enterprises in this, the for- mer closed city of Gorky, have yet to get that far. Many of the things they are trying to make are too big, others are made bet- ter by someone else. And if I did buy an armoured cherry-picker (or is it an armoured-personnel-cherry-picker?) and take it home, where would I get spare parts? Perhaps it was with this improbable vehicle in mind that Mr Yeltsin declared that some konvertsi had been premature and caused as many problems as they solved.
After the President had had a game of tennis with his favourite, Mayor Nemtzov guided him on a regal walk down the shopping mall. The private restaurateur, who had been waiting now for some time, stood outside his new door, attended by a line of waiters in maroon jackets. An interesting by-play then occurred. Two presidential minders turned up — one wearing dark glasses, the other carrying a telephone that, had it not been the size of a small suitcase, might have been called portable. There was an agitated conversa- tion with the restaurateur's minder, a swarthy man in a pea-green suit with shiny lapels. The three disappeared into a back room. A minute or so later, the Yeltsin men shot out and scurried off, leaving the green-suited man to look at his boss and shrug his enormous shoulders. No deal. The restaurateur took off his own jacket, folded it on the back of his chair, lit a cigarette and sighed. It turned out that his connections were with the former mayor. They couldn't deliver whatever it was that was needed if you were to get a Yeltsin smile and handshake. It is becoming diffi- cult for me now,' he said, and made his fin- gers into an imaginary gun and shot himself in the chest.
Earlier, he had told me with relish how Nemtzov would deal with the disruption planned by Vladimir Zhirinovsky, the Lib- eral Democratic Party leader. Zhirinovsky, too, had chartered a river-boat, the Alexan- der Nevsky, and was pursuing the President down the Volga. He was due to dock in time to interfere with the street-walk, thereby upstaging the President for the evening news. The plan was that the locks a few miles upstream would become stuck once Mr Zhirinovsky's vessel had entered them. Sure enough, the Liberal Democratic leader was left there, fuming and pacing his deck for a good five hours before he was released. By the time the Alexander Nevsky reached Nizhny Novgorod, the Rossiya had long since sailed. It was a trick straight out of Mark Twain. Count Potemkin would have smiled.
'No,' the man at the marble works had shouted that morning when the phone rang again. 'We have no more — they've all been taken by the school.' A Russian school, with marble tiles? The penny dropped. Mrs Yeltsin was to visit.
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