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. Last Updated: 07/27/2016

EDITORIAL: New Dreams Same as Old Nightmares




After almost three weeks of uncertainty and intrigue, Prime Minister Sergei Stepashin's government is complete. While it is a relief to actually have a Cabinet, the conglomeration of warring factions that has settled into the White House is in many ways even more alarming than the perverse processes that went into forming it.


Sadly, the best that Russia can hope from many of the ministers in this government is that they suffer the same fate as some of their predecessors, such as former First Deputy Prime Minister Yury Maslyukov, Deputy Prime Minister Gennady Kulik and Fuel and Energy Minister Sergei Generalov.


Along with many in Yevgeny Primakov's Cabinet, these three regularly floated dangerous sounding dreams and schemes. Among the products of these well-fertilized minds were plans to use Sberbank funds for agricultural credits, the creation of a giant state oil company, aviation mergers and the scheme to establish Russia's very own Bank for Reconstruction and Development to allow the state to guide economic development through investment decisions.


None came to fruition, a fate that must devoutly be wished upon most of the plans emanating from the new Cabinet.


First Deputy Prime Minister Nikolai Aksyonenko's proposals are the most blatant examples of such ideas, in particular his call for a "stabilization fund" to be created by contributions from every firm equal to 2 percent of their gross output.


The fund, Aksyonenko says, will be used to replenish working capital at selected "strategically" important firms.


This proposal alone belies the praise that Anatoly Chubais and others have heaped on this government for its "strong, professional" character. To begin with, the regulations to create such a levy on output would be extremely difficult to draft, unlikely to make it past the State Duma and well-nigh impossible to properly enforce.


Even were this not so, the last thing Russia needs is yet another tax. The country has difficulty raising sufficient revenues and spending them wisely not for any lack of taxes, but because there are far too many tax laws that are confusingly and arbitrarily applied, as well as being riddled with loopholes and exemptions. Fewer and less complicated laws that were properly enforced would do far more to give Russia an acceptable, sustainable revenue base.


The other part of the nation's money problem is that once revenues are raised, the government is unable to properly control them - witness the farcical tale that emerged Wednesday of the $600,000 that President Boris Yeltsin earmarked for use to repair his old school and which has since vanished.