Yeltsin acts to halt deals benefiting ex-officials

October 07, 1992|By Will Englund | Will Englund,Moscow Bureau

MOSCOW -- Boris N. Yeltsin reached out yesterday to the worried, grumbling, cynical, apathetic voter -- the ordinary Russian, in other words -- and promised that there will be changes.

In a major speech to Parliament, he adroitly seized on the two biggest public concerns here -- fear of poverty and outrage over corruption -- and said his government would take immediate action on both issues.

In what could be the biggest step, he called for the re-registration of non-state enterprises. Across the country, hundreds of formerly government-owned enterprises have been turned into "joint-stock" companies, with their managers as new owners. Resentment among workers is simmering close to the boiling point.

With re-registration, all these unexamined and often questionable transformations could be called back.

Mr. Yeltsin called for a prohibition of all commercial activity by public officials, the investigation of leases handed out by local governments and rules to combat the laundering of money received through criminal means.

The Russian president, in a sort of State of the Nation address, defended his reform strategy. But he acknowledged that the government had made some mistakes on its journey toward a market economy.

Chief among them, he said, were allowing inflation to get out of control, and focusing on the big picture without due concern for the hardships and fears of individual citizens.

Yesterday's speech came at a key moment in the reforms.

Mr. Yeltsin's program has been meeting with increasing disenchantment over the last few months among ordinary Russians, who have watched managers and bureaucrats all over the country turn themselves overnight into owners of newly privatized firms, while everyone else gets poorer.

Last week the beginning of the government's privatization-through-voucher program aroused minimal interest. Many people have just assumed that the insiders would grab everything worth grabbing.

Yesterday Mr. Yeltsin said his aim was to create a nation of nTC owners, people with a stake in reform.

Besides promoting privatization and land reform, Mr. Yeltsin said his government would take measures to control inflation, to ensure a careful conversion of industry so as to hold down unemployment, to reduce selected taxes, to create private pension funds to supplement state payments and to create an anti-monopoly policy.

At the same time, he said he was appointing Aleksandr Rutskoi, the conservative vice president, to take charge of fighting crime.

"Otherwise, this cancerous growth will destroy all our transformations and designs," he said.

Mr. Yeltsin portrayed his reform course as the one that will do the most good for Russia. He has consistently appealed to Russian patriotism -- and refused to let his conservative and nationalist opponents wrap themselves in the flag.

"We have no other road but to switch the economy to market relations," he said yesterday. "But the market is not an end in itself. It is a means by which we can and must revive Russia. Our goal is a strong Russian state. It should be strong not in the number of warheads it has, but with advanced technologies, a developed, diversified economy, and high living standards."

In an article that appeared in the newspaper Trud yesterday, Mr. Yeltsin emphasized the point.

"Russia," he said, "will not become a second-rate country. It was, is and will be a world-class power, but not so much because of its mighty nuclear weapons. First and foremost, it is thanks to Russia's history and culture, the intelligence of its people, its enormous natural and economic potential and its unique geopolitical position."

In that article, Mr. Yeltsin contended that the most dangerous time has passed, "The worst has been avoided," and there are reasons now for ordinary Russians to be optimistic about the course of reform.

He pointed out, as others have started to do, just how much and how irrevocably Russia has changed in the past year.

The government's first move yesterday after the president's long appearance in Parliament was aimed at the poorest members of society.

Humanitarian aid from Western countries this winter will be reserved for those living in poverty, said Aleksandr HD, deputy minister of social protection.

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