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. Last Updated: 07/27/2016

Yeltsin, Volsky edge closer

One of President Boris Yeltsin's top aides has given the starkest public indication to date that the Russian government intends to bend to pressure from powerful industrialists who oppose rapid transition to a Western-style market economy.


The signal of an impending rapprochement between Yeltsin and Arkady Volsky, a leader of the opposition Civic Union bloc, was swiftly followed by an appeal from Civic Union for the moderation of reform.


Alexander Vladislavlev, deputy chairman of Renewal, the political arm of Volsky's Union of Industrialists and Entrepreneurs, warned in an interview published Thursday of the dangers posed by the policies of "reformist utopians".


He made his remarks after Sergei Stankevich, a key Yeltsin advisor, said that the Russian government was giving "serious consideration" to Civic Union's proposal to install its own "alternative plan" of economic reform.


"Reformist utopians want to transfer Western models of economy, society, politics, while ignoring Russian traditions and history", Vladislavlev told the newspaper Trud, "while neo-Bolsheviks and Communists exaggerate the positive aspects of the recent totalitarian past".


"Neither of the two sides will be able to accomplish anything by democratic means", he said. "I am afraid, that both sides will resort to violence".


Vladislavlev repeated Civic Union's call for a strong, democratic government, and a gradual, economic reform which provides broad social guarantees, especially in preserving the industrial sector.


"We must conserve the industrial and scientific potential that was created by many generations of our fellow Russians", Vladislavlev said.


Civic Union, a coalition of Volsky's Renewal party, the People's Party of Free Russia of Vice President Alexander Rutskoi, and the Democratic Party, united last month to form a powerful opposition to the cabinet of Yegor Gaidar.


While voicing support for the overall course of reform, Civic Union leaders last week offered an "alternative plan" for carrying out the transition from a centralized to a market-oriented economy.


Civic Union's plan includes such fundamental parts of Gaidar's program as land reform and massive privatization state-owned land. But Civic Union foresees the government taking an interventionist role in halting the decline of industrial production and subsidizing loss-making factories and enterprises.


Under Gaidar's original plan, which was approved by the International Monetary Fund, loss-making enterprises would be allowed to go bankrupt and be sold off in auctions, as part of an effort to tear down the remnants of the Soviet economy.


Stankevich, speaking to reporters on Tuesday, indicated that the Yeltsin government had reconsidered that part of the plan.


"The orthodox liberal idea of letting the majority of enterprises go bankrupt, and then, after we have millions of unemployed, retrain, reorganize, sell, and so on, is absolute nonsense", he said. "No one in the government is thinking about that anymore".


Stankevich, well known for his staunch opposition to communism in the early days of the democracy movement, indicated that Yeltsin had already recognized the need for a "second, more practical stage of reform".


"Civic Union's proposal is being given a lot of attention in the government", he said, "because they are talking about stabilization and reforms that will bring about concrete results in production".


Output declined by 13 percent in the first six months of 1992, compared with the first six months of 1991, Itar-Tass reported on Thursday.


Stankevich said that Civic Union's plans addressed the weak spot of the government's reform policies.


Stankevich warned that nationalists could easily take the political initiative because many partisans of Western models of economic reform were out of touch with the rest of the nation.


"Only an emphasis on our own strength and resources, and gradual and productive reforms carried out by a strong government, can save Russia", he said. "The time has come for a second stage of reform".


Stankevich said that it was time to abandon the "liberal dream" of transforming Russia into a Western-style democracy, financed by massive Western aid.


"Volsky is much closer to reality", he said.