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The Xenophile Historian

Belarus Estonia Latvia Lithuania
Moldova Russia Ukraine

A History of Russia


1985 to 1999

This chapter covers the following topics:
After the Implosion
Belarus: Back in the USSR
Estonia, Latvia and Lithuania: The Western Pacesetters
Moldova: The State with an Identity Crisis
Ukraine: An Awakening Giant?
Hard Times for the Russian Bear
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After the Implosion

The collapse of the Soviet Union left turmoil in its wake. The CIS proved to be a feeble presence, a nonentity under which the newly independent states have gone their own way, choosing markedly different trajectories in the process. Often the parliaments of the new states did not ratify the agreements reached by their representatives at CIS meetings. In 1993 Kyrgyzstan issued its own currency, the som, prompting other CIS members to abandon the ruble as the only currency of the commonwealth; later in the same year the CIS joint military command was abolished.

The Baltic States, because of the political experience they gained between the two World Wars, have made the most rapid advances toward a functioning market economy and democratic institutions. The worst performers are Central Asia and Belarus, where much of life has not changed and patterns of government have a pronounced neo-Soviet air. Russia and Ukraine are in-between, with their economic and political progress counterbalanced by signs of the same lack of vision which hindered Gorbachev. Civil wars and extreme instability have grievously impeded development in Moldova, Tajikistan, and the countries of Transcaucasia (Georgia, Armenia, and Azerbaijan). Also alarming was the fact that the USSR's nuclear warheads were located in four post-Soviet states; three nuclear powers (Belarus, Ukraine and Kazakhstan) were born overnight.

Despite their legal divorce from the Soviet center, the successor states share many common and overlapping problems. Trade patterns have been disrupted by economic reform, tariff and currency barriers, and the preference of many exporters (such as the Russian oil and gas industry) to sell their products to markets outside the former USSR. Territorial disputes have caused infighting between some republics, often resulting in deadly violence. One such trouble spot is the Crimean peninsula, which is Ukraine's southernmost territory, but is populated largely by ethnic Russians.

The Crimea illustrates the role reversal many Russians have suffered. More than twenty million Russians found themselves in non-Russian states when the Soviet Union broke up. Most of them have lived there all their lives, and think of no other place as home; under the USSR they enjoyed good jobs and did not even have to learn the language of their non-Russian neighbors. Two of these Russians, in fact, rose to lead the Soviet Union: Nikita Khrushchev and Leonid Brezhnev. In Kazakhstan the Russians outnumbered the natives, until a higher Moslem birthrate allowed the Kazakhs to catch up in the 1980s. Now the Russians find themselves a minority, discriminated against by the people they once considered a lower class.

A strong CIS could possibly deal with these problems. Bilateral and multilateral agreements of a more specialized nature are also a likely outcome. The expectations and ambitions of Russia are pivotal to future developments. Many Russians have a sentimental attachment to the Soviet past; they call the non-Russian republics the "near abroad," and regret that the USSR's collapse has diminished their country's standing in the world. However, for the foreseeable future Russia will probably be too weak and divided to reassert Russian interests in its former empire. The rest of this work will focus on how the seven European republics of the former USSR are faring today.

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Belarus: Back in the USSR

Belarus (Byelorussia before 1991), has never stood on its own. Over the centuries it has been ruled by its neighbors, particularly Lithuania, Poland, and Russia. There are few ethnic differences between "White Russians" and "Great Russians," and during the Soviet era the White Russians were among the most loyal ethnic minorities; here, if nowhere else, Russification was successful. Byelorussia even enjoyed membership in the United Nations, though like the Ukranian delegation, it always toed Moscow's line.

In 1986 Byelorussia was devastated by the meltdown at the Chernobyl nuclear power station; more than one-fifth of the republic was contaminated with high-level radioactive fallout, and many of its residents were exposed. Two years later the Belarusian Popular Front (BPF) was formed, dedicated to the revival of the Belarusian language and the speeding up of de-Stalinization, which had always progressed slowly here. In January 1990 Belarusian was made the sole official language of the republic. However, the republic made no more moves toward independence until after the failed communist coup attempt of August 1991.

The first president was a respected former vice-chancellor of Belarus State University, Stanislau Shushkevich. He changed the name of the state to the Republic of Belarus, adopted the red and white flag that had flown under the short-lived Belarusian People's Republic of 1918, and resurrected a state insignia displaying a knight on horseback (the former symbol of the Grand Duchy of Lithuania). In December Shushkevich hosted a high-level meeting with Russian president Boris Yeltsin and Ukrainian president Leonid Kravchuk, which created the Commonwealth of Independent States, with Minsk as the CIS headquarters.

In 1992 the BPF attempted to force new parliamentary elections by collecting signatures from the public, but the attempt was rejected by the Communist-dominated legislature. Hard-line forces then gained control of political life. Shushkevich, long opposed by his prime minister, Vyacheslau Kebich, was ousted on trumped-up corruption charges in January 1994. As the economy deteriorated, Communist leaders sought closer ties with Russia. The first presidential election took place in July 1994 and resulted in an unexpected defeat for Kebich. A virtually unknown young politician, Alyaksandr Lukashenka (Aleksandr Lukashenko in Russian), swept to victory, with more than 80 percent of the vote in the final runoff.

Lukashenka, a former state farm manager, immediately began to assert his powers over the Belarus Supreme Soviet. In May 1995 he held national referendum that resulted in the removal of the state flag and emblem and their replacement by a flag nearly identical to that of Soviet Byelorussia. These actions resulted in frequent demonstrations; the largest of these protests, involving about 70,000 people, resulted in numerous arrests and police-inflicted injuries in April 1996. The BPF leader, Zyenon Poznyak, fled the country, becoming a political refugee in the United States. In September the government shut down the only independent radio station and froze the bank accounts of at least five independent weekly newspapers.

By late 1996 a power struggle had developed between Lukashenka and the largest faction in the Supreme Soviet. The president demanded a new referendum to extend his term in office and provide him with authority to dissolve the legislature, while the Supreme Soviet sought to impeach the president. Russian prime minister Viktor Chernomyrdin played the role of intermediary and tried, unsuccessfully, to have the results of the referendum declared non-binding. Instead, Lukashenka immediately signed its provisions into law as amendments to the constitution; then he dissolved the Supreme Soviet and created a new legislature composed entirely of his supporters. Thus Lukashenka successfully combined genuine popularity, especially in rural regions, with a repressive regime that openly admires the Soviet past.

The ultimate goal of Lukashenka's foreign policy is the reuniting of Belarus with Russia. By the end of 1996 he handed over the last of Belarus's nuclear warheads to Russia for dismantling. In the late 1990s Lukashenka and Russian president Boris Yeltsin signed four treaties, each one promising closer political, economic and military ties. Liberal Russian officials, however, urged Yeltsin to accept only limited integration. The fourth accord, signed in December 1999, called for complete political and economic union by 2005. Neighboring states, especially Ukraine, denounced these agreements; they argued that it was fully within the rights of Russia and Belarus to reunite if they want to, but they are likely to lose more than they will gain by union. Outside observers note that Moscow pays attention to Minsk about once a week, while Minsk thinks about Moscow every minute of every day.

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Estonia Latvia Lithuania

Estonia, Latvia and Lithuania: The Western Pacesetters

After World War II most countries granted at least de facto recognition to the Soviet Union's absorption of the Baltic States, though the United States never fully accepted it. Moscow never told the Estonians, Latvians or Lithuanians how they became part of the USSR, so the Baltic peoples constantly reminded their children about the non-aggression pact between Stalin and Hitler. That, and the memory of independence before 1940, made nationalist feelings especially strong here; in fact, Stalin had to suppress anti-Soviet guerrilla movements in Latvia and Lithuania, after he drove out the Nazis in 1944. When they got the chance to break from Moscow, the Baltic states were the first to try it.

The Estonian-Russian border became a matter of dispute following Estonia's independence. A piece of Estonian territory had been transferred to the Russian Soviet Federated Socialist Republic (RSFSR) in 1944, and Estonian officials wanted it back. They issued passports to Estonian-speaking residents in the disputed area, which prompted Russian officials to accuse Estonia of trying to annex Russian territory. In 1996, however, Estonia dropped its claim, and in March 1999 the two countries initialed a border treaty.

Another point of contention was Russian troops in all three Baltic states. Russia withdrew its last troops from Lithuania in August 1993, and Estonia and Latvia in August 1994. In return, Estonia agreed to allow retired Soviet personnel living in Estonia to apply for residency; Latvia granted Russia the right to operate an early-warning radar base until 1998; Lithuania permitted traffic through its territory between the Kaliningrad district (the part of East Prussia the Soviet Union took from Germany) and the rest of Russia.

Since independence, the Baltic republics have worked to strengthen ties with each other and with the nations of the West. In 1993 they signed an agreement that removed duties on imports and standardized visa and customs regulations, leading to the creation of a Baltic free trade area in 1997. In February 1994 all three Baltic states signed the Partnership for Peace accord, permitting limited military cooperation with the North Atlantic Treaty Organization (NATO). Currently they are also seeking to join the European Union.

In September 1994 the Riigikogu (Estonian parliament) passed a vote of no confidence in the government of Mart Laar, the first prime minister and a member of the reform-minded Fatherland Party. Andres Tarand, the former environmental minister, was confirmed as the interim prime minister in October, pending March 1995 elections. In the March elections the reform parties were ousted and replaced by a coalition of left-centrist parties. The coalition was headed by the Coalition Party, whose leader, Tiit Vähi, was named prime minister. The vote was seen as a protest against corruption and the pace of reform, despite the fact that reforms had resulted in a 6 percent rise in the GDP. The left-centrist coalition in turn collapsed in October 1995, when Vähi fired Interior Minister Edgar Savisaar, who also chaired the coalition's Center Party. Savisaar had been implicated for the illegal recording of phone conversations between himself, the prime minister, and a leading opposition leader; Vähi and his cabinet resigned the next day. Vähi then formed a new coalition of parties with the approval of President Lennart Meri. In September 1996, a runoff election elected President Meri to a second term in office.

In February 1997, Prime Minister Vähi resigned for the second time, this time under a cloud of corruption charges. He was replaced by Mart Siimann, who took power within the same shaky minority government.

In Estonia's March 1999 parliamentary elections, the Coalition Party won the most seats, with 23.4 percent of the vote. However, it was excluded from the government when the Fatherland Union, led by Mart Laar, formed a governing coalition with the Estonian Reform Party and the Moderates; between them those three parties had 47.2 percent of the vote. Thus Laar returned as prime minister.

Latvia held its first parliamentary elections since independence in June 1993. Only residents (including nonethnic Latvians) who had lived in Latvia before 1940, along with their descendants and spouses, were eligible to vote. This was a result of legislation passed in late 1991, guaranteeing citizenship to these residents only; all other residents (mostly Russians) were required to apply for naturalization once a new citizenship law had been finalized (in June 1994). However, in 1997 about 30 percent of Latvia's residents were still not citizens of Latvia; most were stateless. Tensions rose between Latvia and Russia in early 1998 over the citizenship law. In October 1998, 53 percent of Latvians approved a proposal to relax citizenship regulations.

Following the 1993 elections, the new parliament (called the Saeima) elected Guntis Ulmanis, an economist, as president, and Ulmanis chose Valdis Birkavs, from the Latvian Way Party, to be prime minister. In July 1993 the constitution of 1922 was fully restored. However, the government collapsed just one year later, splitting over the high tariffs for agricultural imports demanded by the Latvian Farmers' Union Party. Members of the Latvian Farmers' Union Party left the coalition, resulting in the resignation of Birkavs and his cabinet. A new coalition government was formed by the Latvian Way Party in September, with Maris Gailis as prime minister. Gailis's term as prime minister was rocked by numerous bank failures, including the collapse of the nation's largest commercial bank, Banka Baltija, in May 1995. New elections were held in October, and the Latvian Way Party made a poor showing with 14.6 percent of the vote. The left-leaning Democratic Party received the highest percentage with 15.1 percent of the vote, and the radical right-wing Popular Movement for Latvia Party, led by a German-born politician, Joachim Siegerist, took second with 14.9 percent of the vote. Since no party controlled more than 18 seats in Latvia's 100-member legislature, parliament rejected President Ulmanis's first two nominees for prime minister before accepting the third, Andris Skele, an entrepreneur with no political affiliation (December 1995).

As prime minister, Skele worked to accelerate economic reforms and to attract foreign investors. President Ulmanis was reelected to a second term in office in June 1996. In August 1997 Guntars Krasts, from the conservative Fatherland and Freedom Union, became prime minister of a new coalition government. In March 1998 Skele formed a new conservative party, the People's Party. The next parliamentary elections (October 1998) saw the People's Party win 21 percent of the vote and more seats than any other party. However, the Latvian Way Party, which took 18 percent of the vote, formed a ruling coalition with the Fatherland and Freedom Union (FFU) and the centrist New Party. Vilis Kristopans of the Latvian Way was chosen in November to head the government.

In Lithuania, former Communists staged a comeback after independence. The anti-Soviet, pro-independence Sajudis coalition won the country's first open parliamentary elections in 1990 and led the struggle to leave the USSR, but it could not maintain political leadership. Its popularity dropped because of political infighting in the coalition, the dictatorial behavior of President Landsbergis, the severe economic crisis that afflicted all former Soviet republics, and a dispute over sea borders with Latvia. As a result, the former Communist Party, now called Democratic Labor Party (DLP), won a majority of seats in the Seimas in February 1992, and in November 1992 Algirdas Brazauskas, the DLP leader, was elected president with 60 percent of the vote. Popular support for this government did not last, though, because the DLP also failed to solve the country's economic problems.

A major banking scandal rocked Lithuania in December 1995; the government shut down two of the largest commercial banks, Innovation Bank and Litimpeks Bank, when it discovered widespread embezzlement. Parliament ousted the prime minister, Adolfas Slezevicius, because he was involved; he had withdrawn his personal savings from Innovation Bank two days before it closed. President Brazauskas appointed Mindaugas Stankevicius as acting prime minister until elections could be held.

After a runoff general election in November 1996, the center-left DLP was replaced by a conservative coalition, comprising the Homeland Union and the Lithuanian Christian Democratic Party (LKDP). Homeland Union chairperson Gediminas Vagnorius became the next prime minister. President Brazauskas decided not to seek reelection in January 1998, and Valdas Adamkus, a Lithuanian-American ecologist, won the presidency by a narrow margin. Although nominally affiliated with the Lithuanian Center Union Party, Adamkus campaigned as an independent, promising to give Lithuania a successful Western-style economy.

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Moldovia: The State with an Identity Crisis

Of all the republics, Moldova has had the hardest time figuring out what role it will play in the post-Soviet era. It was never an independent state before the Soviet breakup, and many Moldovans wonder if they ought to become part of Romania, because they are ethnic Romanians no matter what you call them. Moldova never even used that name in the past. Before World War II its territory was known as Bessarabia, after Basarab I, a 14th-century prince who ruled the southern half of the region. In the 16th century it fell under Turkish rule; then in 1812 the Russians got it. After World War I the land went to Romania, but the Soviets never recognized the loss of Bessarabia. In 1924 a small Moldavian Autonomous Soviet Socialist Republic (ASSR) was established within the USSR, on the border of Romania. The Ukrainian town of Balta was its capital until 1929, when it was transferred to Tiraspol; less than one-third of the population of the Moldavian ASSR was Romanian. When the Soviets got Bessarabia again in 1940, they did what they could to erase previous ties with Romania; Stalin forced the inhabitants of this region to use the Cyrillic alphabet of the Russians, instead of the Latin alphabet of Romania. He also merged Bessarabia with the Moldavian ASSR, and renamed the whole thing the Moldavian Soviet Socialist Republic, though there already was a territory named Moldavia on the Romanian side of the border. Chisinãu (Russian Kishinev) became the new republic's capital.

The Moldavian SSR remained in the USSR until the collapse of Communism. Two future leaders of the Soviet Union, Leonid Brezhnev and Konstantin Chernenko, held government jobs in Moldavia on their way up the political ladder, but both were ethnic Russians; Moldovans were not allowed any say in the management of their republic until the 1980s. With the breakup of the USSR, an independent Moldovan state was established. In December 1991 Moldova's first popular election was held and Mircea Snegur, who had taken charge a year earlier, was elected president.

Ethnic and territorial issues have dominated Moldovan politics since the late 1980s. After a law was passed in 1989 making Romanian the official language, separatist movements appeared in the southern and eastern portions of the country, where Russians and Ukrainians make up more than half the population. The Slavs did not want to be in a country run by non-Slavs, and local officials refused to enact the language law in the area east of the Dniester River. A political group promoting greater autonomy for the Slavic area, Yedinstvo (Russian for "unity"), was formed. The Moldovan government responded by creating a Trans-Dniester ASSR in the east, and a Gagauz SSR in the southeast, both in 1990. After Moldova achieved independence, the Trans-Dniester leadership declared independence from Moldova, but this declaration was not recognized by any country, including Russia. Fighting soon broke out, and in 1992 Moldovan President Snegur authorized military action against the rebels. The secessionists, aided by Russian army units, gained control over the disputed area. The Moldovan government made several requests for UN intervention, but was forced to settle for a combined Russian-Dniester-Moldovan peacekeeping force. In May 1993 Moldova made several concessions to the separatists, including allowing Russian forces to remain in the east, but the Trans-Dniester leadership demanded that the Moldovan legislature rescind parts of its 1991 declaration of independence and return the whole republic to some sort of Russian rule.

In February 1994 Moldova held its first free parliamentary elections. The Agrarian Democratic Party, led by former Communists, won the largest number of seats, while a bloc of socialist parties came in second. In April the legislature cemented Moldova's status within the CIS by ratifying the 1991 agreement; however, the country declared that it would not take part in CIS military or monetary alliances (leaving the door open for a possible union with Romania in the future). In July the country's first constitution was adopted. The constitution reaffirmed Moldova's status as an independent political and cultural unit and included provisions for the autonomy of the breakaway regions of Gagauz and Trans-Dniester. It also called the country's official language "Moldovan,"rather than "Romanian."

In August the government reached an agreement with Russia to remove all Russian troops from the Trans-Dniester region within three years; the agreement was made official in October. However, Snegur refused to meet the secessionists' demands for recognition of Trans-Dniester as an independent state, so the regional conflict continued.

In June 1995 Snegur resigned from the ruling Agrarian Democratic Party, accusing the party of attempting to reduce the powers of the president and of opposing economic reform. In August he became the chairman of a new, centrist political party, the Party of Revival and Conciliation. He ran for his old job in December 1996, but lost to Petru Lucinschi, Moldova's top-ranking Communist official before 1990. Lucinschi, who was supported by the ruling Agrarian Democratic Party and other leftist parties, advocated closer ties with the CIS and Russia.

Negotiations between the Moldovan government, Trans-Dniester leaders and Russia produced a memorandum in May 1997, calling for the peaceful settlement of their conflict. According to the agreement, Moldova will retain its present borders, including Trans-Dniester; future talks will determine how much autonomy the Trans-Dniester district will have. The complete removal of Russian troops is not expected until all sides reach a final settlement.

The March 1998 parliamentary elections saw the reestablished Communist Party of Moldova (CPM) win the largest number of seats. However, the CPM did not have a majority, and a coalition of parties, led by the centrist Bloc for a Democratic and Prosperous Moldova and the reformist Democratic Convention, formed a ruling majority. Ion Ciubuc was appointed prime minister that month. In February 1999 Ciubuc resigned, saying that parliament and the ruling coalition stymied his efforts at market reforms. The parliament appointed Ion Sturza to replace Ciubuc in March.

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Ukraine: An Awakening Giant?

Ukraine, like the Baltic states, got singled out for brutal treatment at the hands of the Soviets. This was especially the case during the famine and purges of the 1930s. Then in World War II most of the fighting on the "Eastern Front" took place on Ukrainian soil, with Ukrainian nationalists caught between Nazis and Communists. After the war Russian immigration, encouraged by Moscow, increased. The size of Ukraine, and its huge resources of coal, farmland and labor, made it very important to the USSR, so any dissent was repressed quickly. The Russians regarded the Ukrainians as little brothers who needed Russification, and tried to suppress use of the Ukrainian language for a while. When Mikhail Gorbachev introduced political and economic reforms in the mid-1980s, Ukraine was slow to adopt them, largely because of Vladimir Shcherbitsky, the reactionary head of the Communist Party of Ukraine. Finally, the 1986 Chernobyl nuclear disaster ignited popular discontent, because it highlighted failings of the Soviet system. A popular-front movement, known as Rukh, capitalized on this and raised the cry for independence.

Confused and demoralized by the failure of the August 1991 coup, which marked the end of Communist rule in Russia, the Ukrainian Communists gave in and joined the nationalists in proclaiming Ukraine's independence on August 24. The legislature's declaration was confirmed by more than 90 percent of voters in a December referendum. At the same time, Leonid Kravchuk was elected as the country's first president.

The euphoria over independence soon faded, because Ukraine had problems big enough to match its ability to prosper. In foreign policy, the most serious problem was Ukraine's relations with Russia. The Russian government raised questions about whether the Crimean peninsula belonged in the new Ukrainian state, because of its ethnic Russian population. An active separatist movement appeared in Crimea, calling for an independent Crimean republic, while internal tensions rose between the more nationalistic west and the pro-Russian east. Above all else, the terrible state of the economy was the most important concern, as it was in the other former Soviet republics. President Kravchuk was slow in launching market-oriented reforms, and confrontations between the opposing political parties in the legislature made passing them even more difficult.

Despite the deteriorating economy, there were some political successes. The presidential elections of 1994 were conducted calmly and fairly, leading to a peaceful transfer of power to Leonid Kuchma. The new president's priority was economic reform, but parliamentary infighting and the lack of a post-Soviet constitution produced a political stalemate. In January 1994 Ukraine began to eliminate the world's third largest nuclear arsenal, which it had inherited from the Soviet Union, along with the Black Sea Fleet. It also entered NATO's Partnership for Peace program, formed in 1993 to offer former Warsaw Pact members limited associations with NATO. In October 1995 it was accepted into the Council of Europe, an advisory council that works to coordinate the activities of European nations. On June 28, 1996, Ukraine adopted a new, democratic constitution, a major political achievement. This success was followed by the smooth introduction, in August, of a new unit of currency, the hryvnia. In addition, Kuchma succeeded in persuading most Crimean political leaders to accept the idea of autonomy within Ukraine.

Still, Kuchma had many political problems. In May 1996 he replaced his prime minister, Evhen Marchuk, with Pavlo Lazarenko, a rich, influential businessman from Dnipropetrovs'k, the region from where the president and many top government officials came. In July an attempt was made to assassinate the new prime minister; many viewed this as part of a power struggle between the politicians and businessmen from two cities, Dnipropetrovs'k and Donets'ka. Thus regional loyalties, conflicts, and corruption, are beginning to play a role in Ukrainian politics.

Meanwhile, complications arose in the highly sensitive dispute over the issue of the Black Sea Fleet, stationed in the Crimean port of Sevastopol. At first Russia and Ukraine argued over how they would divide the fleet's 800 poorly-maintained ships. Once they resolved that, negotiations shifted to the question of who should control Sevastopol. Russia wanted control indefinitely, while Ukraine was willing to offer a long-term lease. In December 1996 the Russian Council of the Federation, the upper house of the Russian parliament, declared Sevastopol a Russian city, and that it should belong to Russia. Although the Russian government, including the foreign ministry, did not formally support this statement, the Ukrainian legislature responded by calling for the removal of all Russian troops from Ukrainian territory. In May 1997, the prime ministers of Russia and Ukraine finally reached an agreement to settle the dispute. According to the terms of the accord, Russia purchased 80 percent of the fleet from Ukraine, and is guaranteed a 20-year lease for its use of Sevastopol; the two countries will keep their separate navies at different bays in the port. The two governments finished their talks by signing a treaty of friendship and cooperation. The Russian parliament, however, delayed ratification of this treaty until February 1999, as it meant giving up Russia's claim to the Crimean peninsula.

In June 1997 President Kuchma fired prime minister Lazarenko, who had drawn widespread criticism for the slow pace of economic reform during his year in office. The president appointed Valery Pustovoitenko to succeed Lazarenko in July. In parliamentary elections in March 1998, the Communists won the largest percentage of the vote, but they still held less than 25 percent of the seats, so independents continued to dominate the parliament. In September 1998, less than a month after Russia's economic collapse, Ukraine's currency, the hryvnia, fell significantly in value; at the time of this writing (December 1999), the country's economy has not recovered. The government put limits on the money supply so that Ukraine could receive loans from the International Monetary Fund (IMF) and the European Union (EU).

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Hard Times for the Russian Bear

Post-Communist Russia has faced many exceptional crises, requiring tough decisions and painful policies. Conflict quickly erupted between Russian president Boris Yeltsin and the legislature. At first Yeltsin enjoyed sweeping powers, granted to him by the Congress of the People's Deputies (CPD) in 1991; the Communists, led by Supreme Soviet Chairman Ruslan Khasbulatov, sought to reduce those powers. These battles were not only a struggle for power, but also an effort to control Russia's economic policy and and restore its pride. Many found it humiliating when Yeltsin asked the West for economic assistance and investment, and his pro-American policy encountered considerable opposition, especially after Russia did not receive the massive Western aid which many Russians naively expected.

Russia's most serious problem was the economy, left in terrible shape by the Soviet Union's demise. Foreign reserves were exhausted, making it difficult to import goods, and economic output had been in decline since the 1970s. This economic decline accelerated with the arrival of free enterprise. By 1994 the gross domestic product (GDP) had contracted to half its 1991 level, a greater drop than industrial nations experienced during the Great Depression of the 1930s. Yeltsin's response was to launch a so-called shock therapy program. This entailed lifting price controls, removing legal barriers to private trade and manufacture, and allowing foreign imports into the Russian market (to break the power of local monopolies). The immediate results of this policy were a wave of hyperinflation--which at one point ran at 2,600%--and the near bankruptcy of much of Russian industry. Unemployment reached an estimated 7 percent, which was low by western standards but far higher than anything Russia had experienced under communism. Russia's currency, the ruble, fell in value constantly, until many parts of Russia stopped using money altogether, going back to a barter economy instead. Despite this, Anatoly Chubais, the deputy prime minister in charge of the Ministry of Privatization, pushed through a program of privatization in 1994. Although in most cases the existing management got to keep the factories they had previously administered, large private banks emerged and began to compete for control of the economy.

Matters were made much worse by the Russian government's inability to carry out the most basic functions of any state, namely keeping order and collecting taxes. The new businesses faced extreme challenges from rampant criminal activity, corrupt officials, and tax collectors who collected exorbitant amounts. The amount of money collected declined every year; the tax collectors couldn't get revenue from individuals and companies that lived by barter and reported no income. Because tax collection was enforced unevenly, and could be avoided by those who knew the right people, only a fool paid taxes in capitalist Russia. Consequently the government went broke, the medical system collapsed, basic welfare services could not be done, and paychecks for government workers were months behind schedule. To fund even basic requirements, the state was forced to borrow from domestic and international markets. Meanwhile, a number of well-placed individuals made vast fortunes by turning assets previously owned by the state into their private property.

Boris Yeltsin kept the economy from disappearing completely with regular handouts of aid from the outside world. In 1997 he used one of his aid-seeking trips abroad to win membership for Russia in the G-7, the club of the world's seven richest nations. However, the foreign aid disappeared as quickly as Yeltsin got it, with few changes visible afterwards. In August 1998 Russia failed to make one of its loan payments, and the budding Russian stock market dropped 50 percent in a single day. At this stage the entire stock market was estimated to be worth less than the stock of Home Depot, a major chain of American department stores.

By the late 1990s, the old, inefficient system of centralized state planning had been dismantled and a capitalist economy was being created. Nevertheless, the process was far from complete, and the Russian people paid a very high price. Most industries used out-of-date technology, employed more workers than they needed, and had been located with no thought about distances from suppliers and markets. Managers and workers trained under communism found it difficult to adapt to the capitalist requirements of profitability, marketing, and shareholders' power. Inflation depressed incomes and wiped out savings at a time when whole sectors of the economy, and even whole cities, suffered from unemployment because of the massive closing of factories.

Russia's political scene has been unstable and conflict-ridden as well. In December 1992 the author of the economic shock therapy, Yegor Gaydar, was forced out of office by his opponents in the legislature. His successor, Viktor Chernomyrdin, was the former head of the gas industry of the Soviet Union; he pursued policies like Gaydar's but made more concessions to powerful economic and political interests. That same month saw the Constitutional Court, led by Valeriy Zorkin, remove Yeltsin's ban on the Communist Party. Yeltsin protested these actions, so he and the CPD agreed to hold a national referendum on a new constitution. Hardliners in local and national legislative bodies, however, resisted the organization of the referendum, prompting Yeltsin to declare emergency presidential rule on March 20, 1993. Yeltsin's announcement of emergency rule was condemned by Zorkin, Khasbulatov, Vice President Aleksandr Rutskoy, and others. Both sides ended up modifying their positions: Yeltsin's emergency rule never went into effect, and his opponents allowed the referendum to take place on April 25, 1993.

Yeltsin scored a resounding victory at the polls, allowing him to introduce a constitution that transferred considerable power to the president, but the referendum failed to resolve his struggle with the legislature. In September 1993 Yeltsin removed Rutskoy as vice president on charges of corruption, an action the parliament opposed, so Yeltsin issued a decree dissolving parliament in the same month. Parliament called these actions unconstitutional and declared Rutskoy president; about 100 deputies and several hundred armed supporters, led by Khasbulatov and Rutskoy, occupied the parliament building, also known as the White House, and refused to disband. A tense stalemate between government and rebel forces lasted for several days. It ended when rebel supporters staged an attack on the mayor's office and a television center. The government responded by shelling the parliament building and arresting the occupiers. More than 140 people died in the rebellion and its dispersal by government forces. On October 4, 1993, Rutskoy and Khasbulatov were taken prisoner and charged with inciting mass disorder.

This victory for Yeltsin was also short-lived. The December 1993 elections gave an unexpected boost to the ultra-nationalist and Communist parties, especially the far-right Liberal Democratic Party, led by an extremist named Vladimir Zhirinovsky. In February 1994 the newly elected State Duma (lower house of parliament), cleared Rutskoy, Khasbulatov, and others of charges relating to the 1993 uprising, and it also granted amnesty to the organizers of the 1991 coup against Mikhail Gorbachev. Yeltsin declared at this point that he would run for a second term, in order to keep the presidency out of the hands of reactionaries. Yeltsin also canceled the early presidential elections that had been scheduled for mid-1994, declaring he would serve out his full term instead.

The determination of the United States to incorporate many former Soviet satellite states into NATO angered the Russian political elite. Because NATO had previously served as an anti-Soviet alliance, Russians resented NATO's expansion right up to their borders. Under Foreign Minister Yevgeny Primakov, Russia became more critical of American policy, and began to rebuild political ties to China and old allies like Iraq. Still, the Russian government recognized its own weakness and the need for positive relations with the West, so it never risked international isolation, nor did it try to develop a powerful self-sufficient economy; that had failed disastrously in the Soviet era. Yeltsin understood this and committed himself to full participation in the world economy, though it meant playing by the West's rules.

Yeltsin's opponents frequently denounced the government's failure to support Russians in the "Near Abroad." They demanded that Russia support the secessionist movements in Moldova and in the Crimea, and condemned the refusal of the Latvian and Estonian governments to grant automatic citizenship to Russians in their republics. This opposition forced Yeltsin to modify his policy slightly. He delayed an agreement with Ukraine over division of the former Soviet Black Sea Fleet until 1997, which allowed him to get a 20-year lease over part of the naval base at Sevastopol, as well as a Russo-Ukrainian friendship treaty. Yeltsin also increased support for the Russian-speaking movement in Moldova, but on the crucial issues, he firmly stuck to a policy that promoted peace. Russian troops pulled out of the Baltic republics in 1993 and 1994, and no encouragement was given to the Crimean secessionists.

Even without the other former Soviet Republics, Russia had dozens of ethnic minorities who looked for either autonomy or independence. The most troublesome of these were the small Moslem groups on the north slopes of the Caucasus. Fighting first broke out in two of those districts, Alania and Ingushetia, in 1992, forcing Russia to declare a state of emergency and station troops in the affected areas. These areas were brought to heel quickly. The demands of other non-Russians, like the Tatars of the Volga, were placated with concessions over sovreignty and tax privileges.

By 1994 the only region still demanding independence was Chechnya, a Moslem district next to Ingushetia. The Chechens had a long history of bitter anti-Russian feeling. They had fought ferociously for decades in the 19th century against the Russian invasion of their territory, and revolted against the new Soviet regime in 1920. Accusing them of collaborating with the Germans in World War II, Joseph Stalin deported the entire Chechen population to Central Asia after the war's end. Nikita Khrushchev allowed the Chechens to return to their homeland, but they never forgot the treatment they had received. With the Soviet Union's collapse, power in Chechnya fell into the hands of extreme Chechen nationalists, and they chose Dzhokhar Dudayev as their leader. Dudayev drove out the Russian garrisons, and allowed Chechnya to serve as a base for those criminal gangs who carried out kidnappings and other outrages on Russian soil. Dudayev's opponents unsuccessfully tried to displace him with a Russian-backed rebellion; it failed, so on December 31, 1994, the Russian government sent troops to restore control over Chechyna. This action proved disastrous.

The Russian army sooned showed that it was no longer the force which had threatened the Free World only a few years before. Cutbacks in defense spending by Gorbachev and Yeltsin caused it to shrink to a third of the size it had been in the mid-1980s; the remaining soldiers were demoralized, hungry, poorly trained and rarely paid. Except for the nuclear arsenal, little remained to show why the rest of the world once feared the Red Army. They did capture the Chechen capital of Grozny in 1995, and killed Dudayev in a 1996 rocket attack, but could do nothing about guerrilla opposition, either in Grozny or in the countryside. Chechen rebels staged their first terrorist attack outside of Chechnya, in the southern Russian town of Budyonnovsk, in June 1995. By February 1996 more than 30,000 people--civilians as well as Chechen rebels and Russian troops--had been killed in the conflict. As elections approached, Yeltsin sought a way out of the conflict.

The growing unpopularity of both the war in Chechnya and Yeltsin's economic policies showed when legislative elections took place in December 1995; the Communist Party won the largest share of the vote (approximately 22 percent), capturing more than one-third of the seats in the State Duma. Led by Gennady Zyuganov, the Communists campaigned on a platform of Russian nationalism and opposition to free-market reforms. Their message proved popular with those who were frustrated by low living standards in Russia and nostalgic for the Soviet era. Zhirinovsky's Liberal Democratic Party came in second with 11 percent of the vote; the Our Home is Russia Party, led by Chernomyrdin, received approximately 10 percent of the vote; and the reformist Yabloko party came in fourth with 7 percent of the vote. Of the 43 parties listed on the ballot, these 4 were the only ones that surpassed the 5 percent threshold needed to gain entry into the State Duma on party lists.

The new State Duma met for the first time in January 1996, with Chernomyrdin retaining his post as prime minister. Following that, the presidential election campaign began. Compounding Yeltsin's low level of popularity were concerns about his health; the president had been hospitalized twice in 1995 with heart problems. When the voting took place in June, ten candidates ran, and Yeltsin and Zyuganov were nearly tied, with neither gaining 50 percent of the vote. This forced a run-off election in July, which Yeltsin decided in his favor by naming General Aleksandr Lebed, the third place candidate, as national security adviser. Lebed's supporters went over to Yeltsin, and Yeltsin won with 53.8 percent of the vote, despite his apparent fatigue and worsening heart condition. By choosing Yeltsin the electorate showed its continued dislike of communisn, its disbelief that old times could be restored, and its preference for stability under Yeltsin.

General Lebed, serving as Russia's envoy to Chechnya, began negotiations in August 1996 with the new leader of the Chechen forces, Aslan Maskhadov, resulting in a cease-fire agreement. Further talks brought a peace accord in which Lebed and Chechen leaders agreed to postpone a decision on Chechnya's status until 2001. On August 31 Lebed declared an end to the war and ordered the withdrawal of Russian troops, which was completed in December. In January 1997, Maskhadov was elected president of Chechnya. Meanwhile, conflicts in and around Chechnya between rival factions and nationalities, such as the Ingush and Ossetians, continue to destabilize the Caucasus.

Yeltsin quickly grew distrustful of Lebed, and angrily dismissed him in mid-October, citing the retired general's refusal to cooperate with Chernomyrdin and Chubais. Although he returned to work in late December, he was hospitalized shortly thereafter with a severe case of pneumonia; his long absence from the Kremlin sparked a debate over his ability to lead the country.

Yeltsin managed a comeback, however, in early 1997. This time he filled key positions with reformers. Chubais became a first deputy prime minister, and was put in charge of economic policy. The other first deputy prime minister post went to Boris Nemtsov, who as governor of Nizhniy Novgorod had enacted the country's most radical free-market reforms. Yeltsin also streamlined the government by reducing the number of deputy prime ministers and abolishing several ministries, including the Ministry of Defense Industry.

In March 1998 Yeltsin unexpectedly dismissed most of the cabinet, including Prime Minister Chernomyrdin; then he appointed Sergey Kiriyenko, a 35-year-old reformer with limited central government experience, as prime minister. Russia's failing economy continued its steep decline, so in mid-1998 Yeltsin dismissed Kiriyenko and attempted to reinstate Chernomyrdin. Parliament rejected Chernomyrdin's return, but approved Yeltsin's compromise choice, foreign minister Yevgeny Primakov, in September. Primakov acquired significant power because Yeltsin's illnesses left him unable to handle many of his duties. In May 1999 Yeltsin dismissed Primakov, criticizing him for failing to revive Russia's economy. Many observers said Yeltsin objected to Primakov's growing popularity. Primakov's successor was the interior minister, Sergey Stepashin. However, Stepashin was no more durable than his predecessors; four months later Yeltsin replaced him with yet another candidate, Vladimir Putin. This time Yeltsin made it clear that he wanted Putin to be his successor, since time was running out for both Yeltsin's health and his presidency.

As the twentieth century comes to an end, any restoration of the Soviet-style communism looks unlikely. The new property-owning elite is too powerful to be displaced, and the Russian state is far too weak to reassert the control over economy and society that it had in Soviet times. Economic recovery and political stability depend on the creation of effective fiscal and legal systems, but it does not look like the Russians will have either in the near future. On the other hand, some regions are beginning to prosper. One positive development, for example, is the dispersion of power to democratically elected provincial governors. This is a welcome change in a country where historically too much has depended on central government and the individual who dominated it.

THE END (for now)

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