Moscow's mayor is winning control

June 11, 1994|By Will Englund | Will Englund,Moscow Bureau of The Sun

MOSCOW -- Moscow Mayor Yuri Luzhkov just keeps getting stronger and stronger.

Yesterday, President Boris N. Yeltsin himself declared that Mr. Luzhkov was free to ignore the national government's policies on privatization. All of Russia might be going in one direction in the great post-Soviet sell-off -- but not Moscow.

And privatization is only his most recent success. For six months Mr. Luzhkov has been asserting and extending his control over the city in different ways.

In October he had the police drive away itinerant traders from the non-Russian fringes of the former Soviet Union. This spring he sharply reduced and regulated the number of sidewalk kiosks, and he swept away a huge proportion of the informal street-side trading that sprang up over the last three years.

These moves are quite popular among Muscovites, who see only chaos and likely criminality wherever commerce is flourishing, especially if those engaged in the commerce are noticeably non-Slavic in their appearance.

But Mr. Luzhkov's primary motivation, by all accounts, is control. And now he may have scored a real coup over privatization, a coup against one of Mr. Yeltsin's own vice premiers, Anatoly Chubais.

Mr. Chubais is the director of Russia's voucher program. In 1992 every Russian citizen received a voucher, with a face value of 10,000 rubles, to be used to buy shares in state enterprises. Those vouchers, all 147 million of them, expire at the end of this month.

The problem, as Mr. Luzhkov saw it, is that the program, the world's most sweeping privatization effort, amounts to a give-away. And why give away something that can be profitably sold?

Thus, except for shops, the privatization of state businesses in Moscow lags far behind that in the rest of Russia. Mr. Luzhkov has insisted that Moscow enterprises be privatized not for vouchers but for cash -- cash that would flow into the city coffers.

He and Mr. Chubais have been battling over the issue for months. In April the mayor decreed that privatization would halt in Moscow and he also banned the sale of land, even though it is an explicit right under the new Russian constitution.

Then, earlier this week, he backed down -- or seemed to. The decree was rescinded and Mr. Chubais held a news conference at which he said, "I personally supervise the process here."

Mr. Chubais promised that his office would get to work fast bringing privatization in the capital up to speed.

Then Mr. Yeltsin pulled the rug out from his under his feet yesterday. At a news conference to mark the anniversary of Russia's declaration of sovereignty within the Soviet Union four years ago, Mr. Yeltsin said he had ordered Mr. Chubais to stop interfering in Mr. Luzhkov's privatization plan.

"Of course we wanted them to make peace with each other," Mr. Yeltsin said, but, he added, his mediation effort had failed.

He then decided, he said, that Moscow is a unique case and no harm can come to the rest of Russia's privatization program if the capital goes its own way.

Thus Mr. Luzhkov, in a manner befitting a Tammany boss of old, is left sitting astride his city with almost unchallenged authority. Unlike Mr. Chubais, a determined reformer, he has no particular ideology. But he steadfastly supported Mr. Yeltsin last October during the parliamentary rebellion, and now he is gathering in his due. All business, all politics, come through him.

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