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. Last Updated: 07/27/2016

Cabinet Non-Plan Plays Well At Duma




Prime Minister Yevgeny Primakov on Tuesday won broad support in the State Duma both for his anti-crisis economic plan and his government's 1999 budget - without actually showing either to anybody.


Tuesday was the day First Deputy Prime Minister Yury Maslyukov had said the government would publish a final version of its long-awaited economic program.


This program has failed to appear on numerous promised occasions during the Cabinet's two months in power, and this week was true to form: Instead of unveiling the program, Primakov, Maslyukov and other top government and Central Bank officials addressed the Duma in a session that was closed to the media.


Afterward, legislators said the government had talked in the most general of terms about things it had already advocated publicly for weeks - like printing some rubles (but not too many), paying back holders of frozen treasury bills (but not too generously) and involving the state in the economy (but not too deeply).


"Primakov is a Communist, Maslyukov is a Communist, and Communists like to make out as if they know something others don't," was the way ultranationalist Vladimir Zhirinovsky explained the secrecy.


"It was very useful," was all Primakov would say to journalists as he emerged from the meeting.


Instead of a concrete program and a draft budget, deputies were shown several budget options for 1999.


"If it does not work out this way, we will do it another way," was how Agrarian faction leader Nikolai Kharitonov summed up Maslyukov's presentation on the budgets.


Some legislators were disappointed that the entire government lineup showed up in the lower house of parliament nearly three months into an economic crisis without a single bill to discuss.


But Alexander Shokhin, leader of the centrist Our Home Is Russia faction, saw significance in even that. Shokhin said the government's presentation was in the great tradition of the Soviet economic super-ministry Gosplan, which in its heyday occupied the building that now houses the Duma.


In the days of Gosplan - the central-planning agency Maslyukov headed under Soviet leader Mikhail Gorbachev - all economic programs and forecasts contained an optimistic, a pessimistic and a middle-of-the-road scenario. Despite the vague nature of the government's presentation to parliament - or perhaps thanks to it - Primakov's government got a much more friendly reception than its predecessors under Viktor Chernomyrdin and Sergei Kiriyenko were usually accorded.


"There is understanding among deputies, there is no angry reaction to [government members'] speeches," Kharitonov said. "I think everybody is concerned with finding a constructive way to work."


Shokhin had a different explanation, arguing that everyone was so friendly only because the government has not yet asked the Duma to approve any specific measures.


"While there are no bills, there is no resistance," he said.


Maslyukov said the government would look at an early draft of the 1999 budget Nov. 17. Finance Minister Mikhail Zadornov, for his part, said the Duma would only see a draft 1999 budget Dec. 1 - and then only if the government reaches a deal with foreign investors on restructuring Russia's defaulted domestic debt.


Zadornov was quoted by Interfax as saying that until the government knows how much it will have to pay out to the holders of billions of dollars in frozen treasury bills, a budget would make no sense.


Shokhin made a similar point, noting that talks with Russia's Paris Club and London Club creditors were needed to determine how much Russia would spend on foreign debt servicing next year. Since there have been no such talks yet, Shokhin predicted the budget would not be passed by the end of this year even in its initial reading, and that final approval was only realistic by the middle of next year.


"The government is still undecided on basic things like tax rates or T-bill restructuring strategies," Shokhin said. "We will not know until the last moment what kind of policy, and specifically what [monetary] policy, will be pursued."


Kharitonov said one of the budget options called for printing 100 billion rubles next year. Other options were less reliant on new ruble emissions. But the government would not say what its specific money-printing plans were.


Communists praised the government for its avowed determination to give the state a bigger role in running the economy.


Liberal deputies, on the other hand, noted that the optimistic version of the 1999 budget was based on a 2 percent budget surplus. Maslyukov, courting those lawmakers who argue Russia needs a balanced national budget, hastened to say after the Duma session that this was "the main option" in the Cabinet's eyes, according to Interfax.


Shokhin said, however, that if the government decides to push a balanced budget through the Duma, that would involve spending cuts, and "the left wing will start voicing doubts and distancing itself from the Cabinet."