Amid economic and political turmoil, a capitalist breed of Russians is creating a new Western-flavored society

February 15 1993


Amid economic and political turmoil, a capitalist breed of Russians is creating a new Western-flavored society

February 15 1993


Amid economic and political turmoil, a capitalist breed of Russians is creating a new Western-flavored society


The Hall of Columns in Moscow’s House of Unions is one of the city’s best-known rooms. During the Soviet era, the bodies of dead leaders from Vladimir Lenin to Konstantin Chernenko lay there in splendor before burial. It is still a famous place, but for a different reason—it is now a casino called Alexander’s Number One Club. Well-heeled, well-dressed customers buy chips with hard currency and place minimum bets of $6 for each spin of the roulette wheel. At Alexander’s, and at 30 other gambling rooms that have sprung up as part of Moscow’s fast-growing nightclub circuit during the past two years, the house’s take is subject to a 90-per-cent tax rake-off by the Russian government Despite that, Moscow’s gambling halls, which range from velvet-draped rooms to seedier locations where the bouncers ask patrons to check their weapons at the door, are flourishing. They attract a few

high-flying foreigners, but the clientele is Moscow’s new rich, including well-connected biznesmen and representatives of the city’s criminal organizations.

Indeed, gambling fever seems to have seized the nation. Capitalizing on the wagering boom, the Russian Olympic Committee operates a weekly lottery, Lotto Million, that sells more than five million tickets at the affordable price of 10 rubles (about two cents) a ticket. Its attraction: winners become instant ruble millionaires. Still, one million rubles is only about $2,000—barely enough for a down payment on a new car. “It’s just derevyanie [wooden money],” Andrei Sobolev, a 57-year-old Moscow hospital technician, said dismissively as he stood before one of the city’s hundreds of bright yellow Lotto Million booths. But then, with a shrug, Sobolev bought 10 tickets for the next draw: “It’s a cheap price for a week’s worth of dreaming.”


A scourge of communism is currently enlivening the once drab streets of Moscow. Advertising, which the former Soviet regime vilified as a means of swindling the people, now adorns billboards along busy Garden Ring Road, surrounding the central city area. Streetcars in shades ranging from shocking pink to bright yellow carry messages touting Barbie dolls, imported cigarettes and other consumer goods. Television ads, complete with Russian-language jingles and voice-overs, push chewing gum, banking services and French perfume.

But like other aspects of Russia’s chaotic lurch towards consumerism, advertising has encountered problems. Michael Adams, Moscow director of the Madison Avenue agency Young & Rubicam Inc., said that local producers of TV ads still have a lot to learn. “Sometimes they just give the name of the firm and no other information,” said Adams. “Most people watching have no idea what those ads are talking about.” Adams says

that Russian producers can learn from Western advertising, such as an 80-second TV spot that his firm produced last fall on government-issued vouchers that can be be used to invest in former state enterprises. He added: “I like to think that people know more about privatization because of our ad.” With many Russians eagerly embracing Western culture and products, the outbreak of advertising seems likely to spread.


Muscovites are crazy about dogs, especially big ones. For the still considerable sum of 100,000 rubles ($200, or 10 times the average daily income), consumers can purchase instant status on the boulevards—a purebred rottweiler straining at the end of a leash. Fashion aside, big dogs are popular because street crime is increasing dramatically in Moscow. Menacing rottweilers, Doberman pinschers and German shepherds have nosed out such smaller breeds as Pekinese and poodles as the dogs most in demand, according to the Russian Canine Association, the country’s largest association of dog owners. Another trend among pet owners: giving their animals decidedly un-Russian names. Two favorites: Mickey and Juliet. Said city veterinary services spokesman Gennady Pogrebniak: “I rarely meet a dog with a traditional name like Druzhok [Friend] any more.”

Cat fanciers also pay hefty amounts for four-legged companionship: purebred Persian kittens cost up to the equivalent of $100 each. Lesser pedigreed kittens are available for about $10. And for Muscovites on tight budgets, there are less pricey alternatives for sale at the city’s busy pet market, where guppies go for as little as five cents and goldfish for 30 cents.


Under Communism, official Soviet morality was straitlaced and discussions of sexual matters were severely circumscribed. Times have changed. In Moscow and other big Russian cities, hucksters in street kiosks offer once | scarce condoms along with imported § lingerie, dildos and other sexual para£ phemalia. Members of a society that is “ still shaking off communist-enforced prudery are ogling such dubious cultural imports as pornographic movies and live sex shows. Attending striptease performances has become a favorite activity for many of Moscow’s new rich. Even the staid Ukraine Hotel, a Stalin-era skyscraper that remains a bastion of Soviet-style service (rude doormen and indifferent food), now has nightly striptease acts and skits featuring young men and women in scanty costumes.

Troubled by the spread of commercial sex, Moscow Mayor Yuri Luzhkov has called for a po-

lice morality squad to combat vice. Police estimate that the city now has at least 10,000 prostitutes, ranging from high-priced call girls who insist on being paid in stable foreign currencies to lowly streetwalkers who get perhaps 200 rubles (40 cents) per customer. Luzhkov has also directed the authorities to crack down on sexually explicit classified newspaper advertisements and such messages as a recent want ad that bluntly stated: “Looking for 16-year-old girls.”


Alexandr Larin looks exactly like what he is—a successful, 37year-old entrepreneur and a member of Russia’s new rich. In 1988, he quit his construction job with the state railway system to capitalize on the limited private enterprise then permitted under Soviet rule by forming a building renovation co-operative in Moscow. With his early profits, Larin bought and sold two ^ used Zhiguli cars—a profitable venture that “ prompted him to expand into auto sales. Now, his company, LLD Holdings, controls 20 businesses with 700 employees engaged in banking and insurance services, construction and car sales. Said Larin: “Russia is a rich country with a huge potential. Anything is possible here.” Larin now has little in common with the majority of Russians who are struggling to survive on inflation-ravaged incomes. Being paid in rubles means daily exposure to shortages and queues. But according to Kommersant CBusinessman), an influential weekly magazine, about three million so-called New Russians work in U.S. currency and earn at least $600 (U.S.) a month—and about 90,000 earn more than $2,500 (U.S.) each month. Those affluent Russians thrive in the hard-currency economies that have sprung up in Moscow and St. Petersburg. Larin, for one, readily ac-

knowledges his pleasure in being able to display such symbols of success as his green 1991 Jaguar sedan.

Still, entrepreneurs tend to remain discreet in a country where many people regard capitalism with suspicion. Said Larin: “Most people simply see us as thieves and robbers who are making off with the country’s resources.” In theory, Russian entrepreneurs should pay taxes of up to 60 per cent on their earnings. But experts said that most of Russia’s rich manage to avoid paying. Indeed, the rich have to be tough to hang onto their wealth. One of Larin’s business partners recently had a new BMW 850 coupe stolen only a day after he bought it. Instead of turning to the police, Larin ordered company bodyguards to find the thief. He said that he is confident of getting the car back.


Successive Soviet regimes, far from creating a paradise on earth, managed to turn vast stretches of territory into ecological wastelands. The reactor that disintegrated in 1986 in Chernobyl, Ukraine, in the world’s worst nuclear accident was one outcome of the system’s disregard for safety and environmental considerations. According to Ukrainian officials, about 8,000 people have died from radiation-induced diseases caused by the accident. Nearly three million people still live in areas contaminated by nuclear fallout from Chernobyl and doctors have diagnosed more than one million other cases of disease caused by radioactive exposure.

Russian President Boris Yeltsin released a massive report last fall, outlining Chernobyl’s devastating effects. It concluded that Soviet policies of rapid industrialization, nuclear arms testing and the careless disposal of toxic and radioactive wastes had made 15 per cent of the former Soviet Union’s land mass unfit for human habitation.

Still, officials at the Russian ministry of power engineering remain fiercely proud of their domestically developed nuclear technology and discount Western claims that 16 Chernobyl-type reactors still in use are unsafe and should be closed down. Indeed, the government has approved construction of 20 more Soviet-designed reactors during the next 20 years. But it has not yet set aside the money to expand a nuclear program that has been largely frozen since the devastating explosion at Chernobyl.


Russia is awash in Western pop culture—most of it stolen. Government officials, who are trying to introduce world-standard copyright laws, acknowledge that more than 90 per cent of the foreign books, movies and recorded music flooding the country are pirated. According to officials at the Russian Press Ministry, the best-selling book in Russia last year was Gone with the Wind, Margaret Mitchell’s sweeping 1936 novel of the American

Civil War. Running second, was another translated classic, Edgar Rice Burroughs’s Tarzan of the Apes, first published in 1914. Feodor Dostoevsky struck a blow for Russian cultural content: a collection of his shorter works, titled

Christmas Stories, was the third most popular book. The country’s top three pop music albums of 1992 could have come from the playlist of a North American Golden Oldies radio station.

The Beatles held down the first and third slots with the White Album (1968) and Abbey Road (1969).

Between them was Golden Hits by the 1970s Dutch group Shocking Blue. At local movie theatres and video salons, the 1939 film version of Gone with the Wind was the most popular foreign movie of the year, followed by Japanese director Nagisa Oshima’s 1976 erotic masterpiece, In the Realm of the Senses, and the 1986 Hollywood exploration of pain and pleasure, 91/2 Weeks, starring Mickey Rourke and Kim Basinger. Meanwhile, Russian writers, dancers and musicians, many of whom lived partly on state subsidies under Soviet rule, are struggling to survive. Last week, the director of Moscow’s Bolshoi Theatre warned that unless a temporary home is found, the theatre and its celebrated ballet and opera companies would have to close down for two years. The reason: the Bolshoi’s 19th-century building needs extensive repairs. Theatre director Vladimir Kokonin complained that the government did not appear to be taking the problem very seriously.


As recently as 1991, there were only 40 Russian Orthodox churches operating in Moscow—less than a 10th of the number when the Bolsheviks seized power in 1917. Religious repression by an officially atheistic government razed many stately domes and converted other structures to a variety of uses, including an electric power station and a vodka distillery. But Russian Orthodoxy survived the Communist era to see its current leader, Patriarch Alexei II, regularly celebrating the divine liturgy in the Kremlin’s Uspensky Cathedral. In Moscow alone, priests and lay members have restored 200 churches, and church officials now estimate

their membership to be a third of Russia’s population of 148 million.

Still, some Russians have raised nagging questions about how the church endured Communist rule. Indeed, a crusading Orthodox priest and a former KGB officer

attribute the church’s current strength to its cooperation with the Kremlin. The priest, Gleb Yakunin, is a pro-democracy legislator who claims to have gained access to secret KGB files shortly after the failed 1991 coup in Moscow. According to Yakunin, informers and secret police agents infiltrated the church hierarchy, spying on their fellow priests. Oleg Kalugin, a flamboyant former KGB general who in 1990 was dismissed from the secret service in a blaze of publicity after protesting such dirty tricks, supports Yakunin’s allegations. Said Kalugin last month: “They were agents first and priests second.” The patriarch has launched an investigation into the charges. But that exercise will produce little of value, according to Yakunin and Kalugin. Too many former agents, they say, are still active within the church—where they know how to ensure their survival.


The government of the former Soviet Union extravagantly promoted the high standards and universality of the state medical system—and carefully concealed its severe deficiencies. Now, with the collapse of the Russian economy, the grim state of the health-care system has become shockingly clear. A government study published last fall showed that 40 per cent of Russia’s hospitals lacked hot water, 18 per cent had no sewage systems and 12 per cent had no water at all. While three out of every five hospitals have X-ray machines, much of the equipment is obsolete or broken. Hospital supply rooms are poorly stocked and doctors complain that they sometimes have to reuse disposable syringes after cleaning them with bleach.

Even getting an ambulance in an emergency can be difficult. In theory, 920 ambulances serve Moscow’s nine million residents, but more than 100 of the vehicles are usually out of commission for repairs. As well, the vehicles are often unavailable because their drivers are using them as unlicensed taxis. Still, in a graphic illustration of the skewed priorities inherited from the Soviet system, an ambulance driver is likely to make more money than the doctor involved in the same emergency call. According to Olga Gerasimova, a neuropathologist at Moscow’s Semashko Medical Institute, doctors earn between 8,000 and 15,000 rubles ($16 to $30) a month. (A ready-made man’s suit costs $40.) Ambulance drivers may earn twice as much.

As the medical system crumbles, overall levels of health among Russians are declining as well. According to official statistics, 90 per cent of schoolchildren have vitamin deficiencies, while half of the country’s students are suffering from some form of chronic disease. Health authorities acknowledge that many Russians no longer have their children immunized against infectious diseases, often because of concern that the needles are unclean. As a result, the number of reported diphtheria cases in Moscow alone rose to more than 2,000 last year, from 46 in 1988. With some impoverished Russian families postponing having children and the infant mortality rate climbing, Russia’s death rate moved ahead of the birth rate last year for the first time since the Second World War. According to health ministry figures, the overall mortality rate increased slightly to 12 for every 1,000 members of Russia’s population of 148 million people. The number of births per 1,000 of population declined to 11 last year from 12 in 1991. It is a grim reflection of the human cost of Communism—and its collapse.


As a courtesy to his landlord, a Canadian businessman renting office space in Moscow recently gave some advice on overseas investment to three people. The men, he recalled, were polite and asked intelligent questions. Later, the landlord revealed that his guests were members of a local protection racket, and that the main reason for their visit was to collect 30 per cent of his monthly rental revenues. Muscovites nod wearily at such

stories about “the mafia,” as any criminal organization is called in Russia. Crime, ranging from widespread corruption and fraud in official circles to street muggings and murder, is one of Russia’s few booming activities. And, as he launched an anti-crime crusade in January, President Boris Yeltsin warned that illegal activities could soon pose a greater threat to the country’s stability than political discord.

The collapse of Communism’s authoritarian rule, widespread confusion over property ownership and upheaval in the Russian economy are among the factors fuelling criminal activities. But some of the crime has its roots in attitudes well-established under Communist rule, when stealing from the state became a national

pastime. In January, military police arrested an air force general who was renting space on transport planes under his command to traders shuttling to and from China. Bribery is widespread in dealings with Russian officialdom, from traffic police to senior bureaucrats. In a 1992 survey of about 800 businessmen in 11 cities, one-third of the respondents said that they had bribed government officials during the past year.

In another survey, two-thirds of respondents said that they felt unsafe walking the streets of Russian cities. According to preliminary government statistics, crimes involving violence and the use of firearms increased by 100 per cent in Russia last year. As well, in Moscow alone, the number of homicides rose to more than 800 from nearly 500 during the same period. In their battle against criminality, poorly paid police officers (average monthly pay for a senior detective: about $64) often do not have enough gasoline for their patrol cars. Even if they did, their underpowered Ladas and Zhighulis are no match for the Lincoln Town Cars and other American automobiles favored by the status-conscious hoods.


Alack of accurate, unbiased information during the Soviet era fostered rumors and speculation about what was really going on. Old habits die hard and rumor mills continue to churn out tales that sometimes contain a kernel of truth. In one case where the jungle telegraph proved to have merit, rumors of an imminent coup swirled through Moscow for a year before the August, 1991, putsch that temporarily unseated then-Soviet President Mikhail Gorbachev. After the coup collapsed, it became clear that an elite KGB unit’s refusal to attack the Russian legislature had been a tactical turning point. According to one widespread rumor, the KGB’s electronically brainwashed soldiers—military automatons who had receptors implanted in their brains—failed to respond to attack commands transmitted by controllers.

Similarly, farfetched accounts still pulse across the ruins of the old empire. One story tells of well-heeled Moscow gamblers who regularly gather at secret locations around the city to bet on unlimitedcontact kick-boxing contests. The deadly

bouts for large purses end only when one boxer is dead or too seriously injured to continue fighting. According to that fantasy, nude waitresses serve drinks to the bettors at ringside.

On a more mundane level, the rise of chaotic and largely unregulated street

markets in Russian cities has fuelled rumors of unscrupulous vendors selling meat from slaughtered cats and dogs. In response, some vendors leave tufts of fur on the carcasses of rabbits and hares to reassure customers that they are not buying someone’s pet.


Staid, timid—and largely boring.

That was the state of television programming in the Soviet Union.

But now, with the heavy hand of Soviet control removed, Russian TV has evolved into an eclectic mix of locally made game shows, religious broadcasts, music videos and soap operas from the West. Several times a week, Russian viewers can watch early episodes from the 1980s’

American daytime soap Santa Barbara, along with similarly dated British sitcoms and German detective dramas.

Since cash-strapped state television outlets cannot afford to dub foreignlanguage programs into Russian, the imports usually feature a single unseen translator who presents all the dialogue in a nonstop voice-over.

Perhaps the most important change is in domestically produced public affairs shows, which now present blunt assessments of the Communist era, and even more daring programs on contemporary issues. A documentary broadcast in January provided graphic evidence of lax security around Russian nuclear missile sites.

Still, no program, domestic or imported, has come close to matching the impact of a 1978 Mexican soap opera that began

on Russian TV in 1992. Over 249 episodes, The Rich also Cry presented melodramatic twists and turns in the lives of fictional rich Mexicans. Polls regularly showed it to be the most popular show on TV. After the long-running serial’s final episode aired in December, TV executives immediately put another Spanish-language soap opera, My Second Mother, on in its place. The Communist state is gone, but the appeal of a retreat from reality remains.