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. Last Updated: 07/27/2016

Regions Fight For Finances, Not for Power

Last Thursday, President Boris Yeltsin signed decree No. 834. It wasn't your run-of-the-mill document, but it wasn't exactly unique. It was a decree by the big president in which he annulled the decree of a little president, the president of the Komi republic.

A year ago, the Komi president used his decree to form a noncommercial organization, the foundation Northern Resources. This organization was endowed with the functions of a specially authorized unit of the executive power, with broad powers. The responsibilities of this organization included collecting taxes for the Komi budget, for the cities' budgets and for the territory's road fund.

From the republic's president, Northern Resources received the right to obtain from the taxpayers tax fines in the form, not of money, but in goods and raw materials.

It's not hard to guess that this purportedly noncommercial foundation inevitably became a powerful trading and financial institution with broad administrative powers.

It is natural that Russia's president finally decided to liquidate this strange organization, which united the functions of tax inspectorate, tax police and large trader all in one.

We should note that Yeltsin put up with (or didn't notice) the initiatives of the Komi president for an entire year. And in his decision, the president of the country merely annulled the decree of the Syktyvkar leader and asked him to liquidate Northern Resources.

Many regional leaders try in one way or another to use financial sources for their own benefit, to create all sorts of extrabudgetary foundations and introduce various fees, including fees for crossing the border into their regions. And the federal authorities don't always act as they did in the case of Northern Resources. In this case, though, the region had assumed too flamboyantly the functions of the federal authorities.

Local leaders have long understood that they need to fight not for political power but for financial sources. They don't need to necessarily form such "noncommercial foundations"; it's enough to withhold teachers' salaries and children's benefits (which, by law, are to be paid from local budgets); the federal authorities will simply be forced to pay out money for these costs. People in any case are displeased with Moscow and don't want to delve into the details of the corresponding financial responsibilities of the center and the regions.

The federal budget, under pressure from picketing and strikes, has given money to teachers and doctors, and as a result of this has withheld student stipends and professors' salaries, which are financed exclusively from the federal budget.

Often local administrations use the money for teachers' and doctors' salaries as they wish -- on road repairs, for example, or for supporting some local enterprise. But regardless of who foots the bill, it's always a success when money designated by Moscow for teachers and doctors is finally paid to those who earn it.

To all who have read my column in The Moscow Times over the past five years: Unfortunately, I must say farewell. I have accepted a position as first deputy editor in chief of the newspaper Segodnya, and my new responsibilities will not allow me to continue this column. I will miss you very much.