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. Last Updated: 07/27/2016

Reformers Target Gaidar's 'Monopoly'

Alternative free market reform parties outside the government are trying in this week's elections to end the stranglehold Yegor Gaidar's team has had on shaping policy, attacking especially his plans for privatization and financial stabilization.

The Russian Democratic Reform Movement, led by St. Petersburg mayor Anatoly Sobchak and former Moscow mayor Gavriil Popov, and the Yavlinsky-Boldyrev-Lukin bloc, have both presented economic programs designed to end the monopoly Deputy Prime Minister Yegor Gaidar's Russia's Choice has tried to grab on the free market tag.

"Gaidar and Russia's Choice think their program is solely right, but we do not share many of their ideas", said Andrei Antonov, one of the leaders of Sobchak's group.

Mikhail Zadornov, one of leaders of the Yavlinsky bloc, in an interview Wednesday attacked Gaidar's privatization program, which sells state enterprises for vouchers to small investors, on the grounds that it effectively handed over control of the majority of privatized firms to incumbent directors.

The result, he said, was not increased production but "to increase personal incomes".

The program of the Yavlinsky bloc, which hopes to win 15 to 25 percent of the vote Saturday, proposes instead a sell-off for money which would give control to serious investors.

The party's program says that firms, which cannot attract major investors, for instance, Russia's railroads, should remain under state control.

Sobchak's group opposes the privatization ideas of privatization boss Anatoly Chubais, proposing that key sectors, including transport and communications, should remain in state hands.

Andrei Antonov, one of the party's leaders, said that highly profitable enterprises do not need to be privatized.

Another major disagreement is monetary and fiscal policy.

Unlike Gaidar, who stresses targeting inflation, Sobchak's group says the monetary sphere can be stabilized only through supporting producers.

"When the government manages to keep the budget deficit low in one quarter through stopping credits to producers, it could trigger a huge deficit one year later, because no economy can exist without production", says Antonov.

Similarly Yavlinsky, says incentives for production and competition, rather than fighting inflation are the key elements of a successful financial policy.

Yavlinsky thinks Gaidar's goal of reducing inflation to 5 to 10 percent in three years is unrealistic. His colleague Zadornov said: "Inflation is an effect, and we want to fight a cause".