Diary notes, 17 May 1992    – my Germans are saying “re-build the Wall!”

After three very hectic weeks of travel, the past week was a chance to dig out from under the mountain of personal mail at the Cologne apartment (which I did not visit for the whole period) and business mail at the office.

I had the good luck to be away during the two weeks of industrial strife in Germany when the public sector employees, including garbage removal and postal workers, were on strike. And perhaps the intensity of the local feelings about the costs of reunification escaped me. Because that is what the latest round of industrial action is all about.

 I had been very admiring of Chancellor Kohl at the time when he forced the pace of reunification 24 months ago, because I had listened to my German co-workers who were uniformly unenthusiastic about unification with the East on grounds of the likely costs in higher taxes. These guys had seemed so pedestrian, so lacking in vision, whereas Kohl, who previously seemed so potato-like dull, now showed the great historic sense – to seize the moment of Soviet disintegration and the generally benevolent tenure of Mikhail Gorbachev, to do what two generations of W. Germans had said was a national goal and to reunite the divided nation.

Now I see the dangers of ‘leadership’: Kohl over the two years has made light of the costs. His formula of 1DM=1 Eastmark was politically expedient in alleviating objections in the east before the vote; however, it led to the economic destruction of what had been the strongest economy in Eastern Europe as E. German labor priced itself out of the market. The bills eventually came in: something like 100 billion DM per annum to prop up the terminally ill E. German economy, the creation of a gigantic welfare establishment which the West Germans have been paying for partly in the form of higher taxes but mostly through public borrowings that have driven up the interest rates to giddy levels, and partly through a steep rise in the inflation to over 4.5%  It is the latter phenomena that gave birth to the labor demands for steep wage hikes even as the economy has softened. Kohl was not forthright with the people as he led them down a path that had little public approval and now there is hell to pay. As my boss says: “we don’t see why it was necessary to unify with the East; the wall should have stayed up; they are a different country and should have remained so.”

Is this a good or bad thing? How curious that while England’s Thatcher and France’s Mitterand have fretted over a hypothetical resurgence of German nationalism, the facts have shown the opposite: the average German doesn’t give a damn about the big policy issues and is concerned only about his levels of taxation. So the remarks of my German classmate from Harvard, that someone might take away his Ph.D. given that his thesis set out to prove the impossibility of reunification, those remarks are premature: the reunification has not really taken place in spirit; the GDR has been taken over but not absorbed.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Travel notes,  Monday 16 March – Friday 20 March 1992 – Tour of the Baltics

A very compressed trip with many impressions. A very exciting time to be visiting the Baltics, and good to stop en route in Warsaw to look over the new contractor operation set up under my guidance, and to visit in Helsinki with the ops manager Ari Kovero to finalize plans for changed traffic flow to St Petersburg and the Baltics.

Warsaw.   Have a brief meeting with LOT downtown office to prepare the way for using their flights into Vilnius to serve the Baltics; then go out to the Service Partner’s offices at Warsaw airport in a container owned by LOT. Low overhead solution – all the basic necessary equipment is installed – telex, IBM and Acer computers. All staff have signed written labor agreements with the new contractor, per my demand. Staff is rather sullen towards me, and even Jack and Konrad are cautious with me, since I really did pistol whip them all during the showdown with the Servisco boss the preceding week. However, I make no apologies for my behavior.

At 8pm I check in for the LOT flight to Vilnius. I have had misgivings about flying this route. LOT was not my favorite airline, but I was reassured by the spring like weather we had been having and by the official designation of a French-Italian built new propjet plane ATR on the route. Weather has since turned foul – we have had wet snow all day long. So I am not surprised to learn, shortly before scheduled departure that the flight is delayed due to difficulties at Vilnius airport. However, after an hour we are invited to board.

The plane is indeed new; but as an elderly Pole sitting across the aisle from me complains, it vibrates like hell even if it is a Western product, so the 90 minute flight is no treat. We arrive to similar weather conditions in Vilnius. On the taxiway I see, to my considerable surprise, a parked Boeing 737 with the colors of “Lithuanian Airlines.” The terminal building is in advanced reconstruction, with adaptations for starting international services underway, so that we are offloaded onto a bus and then taken all around the terminal building to a side entrance where passport control booths have been installed. I get my cost-free visa in 10 minute – on a separate sheet. The crest of the Republic of Lithuania below, the Soviet text above.

Before leaving Warsaw I got assurance from Glab that he had made phone contact with Vilnius and that they knew to meet me at the airport. Now as I come through customs the 3 partners of Lex Ltd are there waiting for me and we drive in their little Lada through the icy streets down to the city where I am shown to my suite and where we proceed to go over current business till nearly 1 am. Meanwhile we learn that Messrs Saarestik and Suiray from Tallinn have also checked into the hotel, so all is proceeding as I had hoped. Finally, thoroughly talked out, I collapse in my bed. The hotel, though clearly built in the late 1970s or 80s is typically run-down and shoddily constructed.

Tuesday, 17 March 1992

Breakfast before 8am in the ground floor restaurant. As I take my place by a window close to the entrance, I am sure that the guy at the next table is familiar – but he is so stocky that I am not sure I am right. After all  the face is so very Finnish that it could be someone else. He sits down with 4 colleagues, then stands to introduce himself to another co-worker who is joining his table. “I am Kauko Peltonen” – I immediately go over to shake hands. It is indeed old Kauko, former SEP (ITT) manager in Moscow, who left the company after Alcatel divested itself of the Finnish subsidiary, but whom Luigi brought back to become the Alcatel office manager in Moscow. Kauko is not delighted to see me, says sourly “as you can see, nothing has changed here” then we exchange cards.

At around nine I meet up with Saurestik and Shiray, and all of us – the Tallinnn and Lithuanian groups – sit down together in my suite to put together the action plan for the Baltics. I learn that Moscow has been holding for more than2 weeks all Baltic traffic at the office; that Yuri’s pledge to forward all packages by train was never kept. Only now, when I am in the Baltics, has Moscow finally put a man onto the job and arranged train forwarding. Some 140 kg in 6 sacks are being sent up to Tallinn; a sack for Vilnius arrives while I am there. I catch Yuri on the phone and he says lamely that he couldn’t free up a man to look after the transfer.  He also confirms by phone that he’s having difficulty assuring traffic to and from St Petersburg!

We agree tentatively that we will set up direct movements into and from the Baltics either via Tallinn (Helsinki) or via Vilnius (Warsaw), that I will gather all possible information during the visit and we will take a firm decision beginning next Monday. I separately order Cologne to suspend shipments into the Baltics until we can reach a decision.

We meet with Lithuanian Airlines and explain the interest we have in using their flights from Vilnius to Warsaw. Also have friendly chat with Austrian airlines at the airport regarding their twice weekly flights to Vienna. Go over to meet with the U.S. Embassy staff around 6 pm – there we are received by the Communications manager, who definitely shows an interest in using UPS for diplomatic mail. The embassy is spanking new and still glows from the recent visit of U.S. Vice President Dan Quayle.

Weather has turned fair and cool, but there is absolutely no time for sightseeing. We go straight down to parliament mall, where barricades from construction materials still safeguard the representatives from the still present Soviet military.

Vladas, the senior among the troika, with a doctorate in computer sciences, arranges a press interview for me with a lady journalist at the country’s leading newspaper, where his brother works as a layout designer. The gal is tough and curious – wants to know my political views and not only company claptrap. So off the record I express my admiration for Lithuania’s toughness, stubbornness in the face of Western indifference to win and defend their independence from Moscow. Asks about my wife and daughter – just thirsty for fresh information about how a manager in the West lives.  Then we go over to the other hotel for a brief radio interview with a lady reporter for Radio Lithuania. I make a short statement that is broadcast the next day in their shortwave English language program.

We all take a late dinner at my hotel – the top floor hard currency restaurant that resembles the Hotel Vitosha setting in Sofia. There is a sexy bare assed floor show which we sit part way through. Go to bed at close to midnight – hoarse but exhilarated.

Wednesday, 18 March 1992

After breakfast at 9.30 we all set out for Kaunas, home base of 2 of the 3-man Lex team. The second capital of Lithuania is roughly in northeast direction en route towards Latvia.  I join Sarestik and Shiray in their chauffeur driven big Mercedes.

In Kaunas, we stop just off the central pedestrian mall, the main street of the town. All is orderly, clean, in an excellent state of repair. We visit the honey-comb offices where Lex is now camping out, and where they are now threatened with eviction. A single room with city phones. The legal basis for free enterprise is scarcely there. All is political conflict between various factions of reformers and hard-liners. VAT is a subject for conjecture. Profit taxes are headline news. Privatization is the buzz word, but the reality is continued uncertainty, fighting over procedures for accepting and adjudicating claims of pre-war owners.

Currency is the ruble. Cash is in artificially short supply. One of the partners takes me on a little walk through stores – some already private. A department store is showing off Western household goods, kitchen appliances. A street kiosk sells me 110 g of Russian caviar in a blue tin for $3.00  Currency is rationed to citizens who can obtain up to $200 in a year for travel abroad. He shows me the equestrian statue to the 14^th century prince of Lithuania. A nearby alley displays marble pedestals and bronze busts of 18-19 century scientific and cultural leaders in Lithuania. I am stunned to learn that these are all reconstructions of original monuments destroyed under Stalin – reproductions made over the past 2 years and paid for by public subscription. A fantastic witness to popular determination to sweep aside the nightmare of the past 50 years and rescue the fabric of national life.

We part with the Lithuanian group and continue towards Riga.

Vilnius – Riga is 300 km. The road is mostly 4-lane highway in good shape. This was the one achievement of the last Communist premier, who appropriated funds for construction in the face of opposition from Moscow.

As we reach the Latvian border, I get a first surprise: notwithstanding all the talk about the Baltic union, this is indeed an international border, where border police stand watch on each side and inspect travel documents. My Lithuanian visa is accepted. We reach Riga towards 3 pm and after some difficulty find the offices of our unofficial delivery partners. These guys had not been interested in the parcel business when we met 6 months ago in Tallinn but now the champagne bubbles have burst, the drink is flat – the economy is in a slide and income from UPS business looks increasingly attractive to them. We have a quick meeting in their offices during which I collect their delivery records, agree on installation of a telex, and agree that they will be a subcontractor to the Tallinn team. (Separately I had agreed with the Lithuanian group to find subcontractors in Minsk to cover Byelorussia for us)

Riga looks big – solid. We take lunch at a nearby hotel restaurant; all the old treats – vodka, smoked fish and meats. Then we walk to the newly opened 4-star Western luxury hotel. The clientele is here – the prospects are good. Riga with a population of 1 million has nearly 40% of the total population of the republic. The VEF electronics factory now has connections with Philips. The outlook for business is interesting. Whereas the local guys had only deliveries till now since they had no written contract, they will now also be interested to sell exports for us.

Towards 6 we again set out by car in the direction of Tallinn. Another 300 km, now on a two lane ordinary road. But with newly raised gas prices, traffic is minimal so we mostly cruise at 120 km/hour.

Again we reach a genuine international border at Estonia. The ongoing journey across Estonia by night hints at a rich countryside, with occasional private houses and apartment buildings that are brightly lit and resemble closely the Finnish countryside. We pass a couple of the newly opened NESTE gas stations – splendid, perfectly Western, and charging FIM for petrol that Estonia still gets largely for rubles from Russia. Saarestik complains bitterly over this perceived rip-off which is supported by systematic shut down of the old state-run stations. We reach the Hotel Olympia at just after 10 pm and I take my junior suite.

Thursday, 19  March 1992   Tallinn

Tough day of meetings with Saarestik. I learn all the unsavory details about how he had a fight with his partner, how our records have been stolen, and the clientele was turned over to TNT, with whom that partner had been working in parallel. I visit the offices of Baltic Trading nearby to discover that this  contractor to Finnair who does aircraft handling for imports, has accepted DHL as a sublease tenant in their premises and are letting DHL use their basic account for Estonian shippers’ payments. Nonetheless, the scheme is workable for us to tender to Finnair in Helsinki and receive imports in Tallinn straightaway. Perhaps in two months direct export will also be workable this same way.

Friday, 20 March 1992   Tallinn – Helsinki

A very rushed morning. I visit the US embassy  and British embassy to wave the UPS flag. Both show clear interest in the service. Then rush over to the airport for the 11.15 am flight to Helsinki – where I am met by Ari Kovero and taken over to the UPS offices for a couple of hours of discussions.  Ari speaks with Finnair and confirms that we can do transfer from incoming UPS charter flight at 8.00 am to ongoing Finnair flights to St Petersburg (9.30) and to Tallinn (10.05). Also agrees to help get emergency supplies down to Tallinn and to train Shiray.  Back to the airport for the Sabena direct flight to Brussels.

Hell of a trip. I’m in seventh heaven.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Finale of the USSR, Gorbachev’s leaves the stage

Diary notes, 25 December 1991

Wednesday,  25 December – a completely lazy day. The news of the day is Gorbachev’s resignation speech and U.S. recognition of the successor states to the USSR, – Russia, Byelorus, Ukraine, Armenia, Kyrghizia. This is a watershed in history. For the first time in 70 years the red flag is lowered in the Kremlin and the tricolor flag of Russia is raised in its place.

I have been a most admiring fan of Gorbachev for most of the past 7 years of his rule. He is clearly a giant intellectually and in political gifts. He succeeded in moving the Soviet Union into radical reform without violence and catastrophe thus far.  Yet he was also a victim of his own successes and eventually made himself irrelevant. He opened the political process to new forces which rightfully moved onto the stage and displaced him. He put too much emphasis on retaining the structures and personnel of the past, hoping to make the Communist Party into an obedient tool of his reforms. Instead he nearly became the victim of the Right, whose powers he, like most everyone else, overestimated.

The death knell for Gorbachev’s years sounded  during the August 21-23, 1991 coup d’etat. The loud mouth and unorganized democratic opposition , Yeltsin, Sobchak, Popov, who had over the preceding years shown only their unpreparedness to administer and run things, now in a pinch showed their civic courage and saved Gorbachev’s freedom from the henchmen of totalitarianism: Yaneev, Pavlov, etc. whom Gorbachev himself had put in power ostensibly to forestall such a right wing reaction, but also as continuation of his balancing act between right and left to maintain his own relevance and indispensability.

Gorbachev, saved by the Liberals, now became their hostage. Like a sparrow that has been rescued by humans, he was healed but lost his ability to fly. It was only a question of time before the dual power, the contest between him and Yeltsin would be solved once and for all. And so it should: continued dualism would only invite further putsch attempts.

Yes, I agree with those who find the gentleman Gorbachev a far more calming, reassuring leader than the ruffian Yeltsin, who seems to talk from the corner of his mouth and to snarl. But this is the man who saved Russia, who scrapped the Communist Party and he’s the one to implement economic reforms about which Gorbachev could only talk in a dilettantish way. Yeltsin, like Walesa, is the first leader to have an electoral and popular mandate to carry through reforms that everyone knows will cause much suffering on the already miserably poor and unhappy population. The price de-regulation comes on January 2^nd; let’s hope Yeltsin can stick with the Polish radical reform and not fall back on the populist, interventionist economic policies that were formerly ascribed to him.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Travel notes, Yugoslavia, Wednesday 20 November  –  Friday, 22 November 1991

This is my first trip back to Slovenia since the start of the civil war this summer. In the meantime, six weeks previously I was in Belgrade for a meeting with Dragan Brscic to spin off the Serbian and south Yugoslav operations from control of Intereuropa. Brscic had spoken like a true Serbian nationalist, though in fact he is a Croat with a father in the Yugoslav foreign service.

Now I meet with old friends Tanya Filipovic, Rihard Baznik and Alojz Pozar. The last, most conservative, finally agrees there can be no restoration of the Yugoslav household, that the idea of living under one roof is unthinkable. Still, for business purposes, he does have hopes that realism will prevail and that Intereuropa can once again serve us in the non-Serb southern republics.

Tanya is no longer looking like a freedom fighter. She is a mother who is hoping that peace will break out. I say that there will be peace only when the Croats start doing war: that the issue of the day is not the EEC peace-keeping mission of Lord Carrington, which has merely been a smokescreen used by the Serbs to wage their war of aggression against Croat civilian populations, nor is it the follow-up peace mission of Cyrus Vance, which served involuntarily the same function. Rather, the issue is as soon as possible to achieve recognition of Slovenian and Croat independence and supply of real arms from outside so that they can properly defend themselves and repulse the Serbs. Tanya is frightened by my talk. Rihard is in agreement. Here the Croats have been wishy-washy, to their great loss whereas the Slovenes have stood fast and put their backs to the wall.

What is incomprehensible to me is why the Croats have not simply blasted some of the Yugoslav Army barracks into cinders. That would get some attention. Here I see criminal lack of leadership by F. Tudjman which is paid for in the blood of Slavonia and which may bring him the bullet he so richly deserves.

Otherwise the Slovene Istrian towns are unchanged. We get new Slovene currency and we see that a real international frontier will come down now between Slovenia and Croatia. Slovenes are probably safe: Serbs need an independent Slovenia as a buffer state between themselves and the Italians/Austrians. But Croatia is going to suffer a terrible devastation while the Serbs exact their vengeance.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Travel notes,  Poland, Warsaw and Lodz, Tuesday, 5 November – Friday, 8 November 1991

Meeting with Mrs Edwards, newly appointed (August 1991) director of the U.S. Trade Development Office. She makes the following points:

Warsaw has full employment.  Anyone seeking work can find it, though salaries may be below expectations

Similar situation in other major cities

Most lively economically is the corridor of Warsaw-Poznan and Warsaw-Szczecin. Least dynamic is the South, particularly Krakow.

Is the mass influx of Western goods being paid for my exports? No, it is paid by the mattress money – the $5 – 12 billion which was kept hidden awaiting attractive consumables

The objective of the Polish government a year ago was to sate their pent-up demand by opening the Polish borders to all imports. Import duties were dropped to nil. Now in September 1991 the duties were put back – to levels above the EEC, in time for negotiations with the Economic Community and also to re-start industry.

Why is privatization so slow? Because the government has sought to proceed prudently with utmost transparency and avoiding back room deals. They have hired international consultants to guide the privatization of each industrial sector.

Official statistics vastly under-report the real economic activity because so much of it is not captured in tax or other statistics gathering = black economy.

My critique:

Salary levels in Warsaw are twice the national average, which remains $70-80 per month in both state and private enterprises.  Therefore the buying power is not there to sustain the present consumption binge. It is at the expense of past forced savings over many years.

The opening of frontiers for imports over the first three quarters of 1991 wiped out a whole stratum of manufacturing entrepreneurs. Once burned, these people will think 10 times before starting up production enterprise again. The real economy today is a retailing, not a manufacturing economy.

However laudable the use of prestigious consultants to map privatization may be, it’s a serious mistake to disdain those companies which came forward now with money in hand to buy up assets. Consultants take no risks. Their advice is of limited value. Better to believe those who come with money in hands. Those assets have no intrinsic value – are worth only what bidders will pay.

Edwards is enthusiastic – enjoys her work , without any sense of self-consciousness or false pride.

Meeting with the Vice President of the newly founded Tourist Bank, Mr. Jerzak.  85% Treasury owned, with participation of PTTK, Committee on Tourism.

His points:

So far the EBRD, Jacques Attali, have done nothing, only given good press. And they fear Attali is looking too much at Russia.

More relevant is Czech banking operation in support of trade financing. The Tourist Bank is closely interested as an essentially investment bank.

Banking is what E. Europe needs most acutely now. Only trade finance can restore what has fallen away with Comecon.

 I find that Jerzak is a clever, impressive guy.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com]

Diary notes –  23 October 1991 – Michael Emerson as a barometer of European foreign policy

 Saturday morning is rushed because we’ve got a midday lunch gathering organized by the Harvard Club in downtown Brussels to hear Michael Emerson, Head of the Delegation of the European Commission in the USSR – speaks on “Unification and Disintegration: the EEC and the Soviet Union.”

Apart from the luncheon meal itself – a fine ragout of venison washed down with an ’83 Bordeaux, this event is infuriating. Emerson shows himself to be a scatterbrained pompous fool carrying out a narrowly selfish EC policy that does no credit to its national sponsors. The meaning of his speech is that while the EEC grows and integrates, the Soviet Union is falling apart. Emerson is a voyeur, a jotter of personal impressions who evidently is gathering material for some future book of memoirs, nothing more. He remarks in passing that his year of international affairs at Harvard in the  mid-80s was the happiest year in his life – and so it must have been because this is no man of action.

His task is to execute the EC policy of keeping the Union together at all costs – parallel to the task of the EC firefighters in Yugoslavia’s civil war. It  is a dishonorable task. The U.S. wants the Union preserved, wants to keep the corpse of the USSR alive to co-host the mid-East process and to get Mikhail Gorbachev’s signature on some more pretty disarmament agreements. The latest unilateral disarmament proposals of the U.S. show that even this function is superfluous – the sides can disarm effectively without negotiating.  However, why does the EC want to preserve the corpse of the Soviet Union? To keep in its peoples and prevent a flood of refugees from spilling over into Western Europe? To avoid having still more applications to the EEC club at a time when it is fighting internally over completion of the federal union among the 12 and is about to negotiate widening to embrace EFTA?  Here is the key to it all. And this is pitifully narrow vision – inadequate and unworthy of the historic opportunity before us.

Soviet and East European membership is a football in the contest between the UK and France/Germany over the meaning of the Euopean integration. Here is why they back Gorbachev and Yavlinsky.  They were forced to acknowledge the independence of the Baltics, but they bitterly resist independence for Ukraine and other republics. They turn a blind eye to the powerful force of nationalism, which they pompously denounce as egoism, while they themselves combine unseemly squabbling over sacrifice of national rights before a common currency and foreign policy.

To my thinking, all the republics of the USSR should get out from beneath its wreckage as fast as they can. It is their obligation to realize their national potential before re-uniting in any supranational body of any kind. I steam as I listen to Emerson and then to the equally pompous and fatuous speakers/questioners.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Diary notes, 2-3 October 1991 :  Greetings from free Tallinn!

Wednesday, 2 October

Drizzly, cold autumn weather

Yesterday I made my first entry on Soviet territory without a previously issued visa. All went according to script. The Estonians put visa No. 1144 in my passport; the first time my sojourn has been recorded in take-home form.

Last night after a bottle of Moet et Chandon, followed by a bottle of Russian sparkling red wine we relaxed from a hard day’s tutorial in the ways of UPS. The strange gangster like team from Riga went home and our team of Estonians, and Soviets (Manuilov from the JV in Moscow) eased into a discussion of ‘where were you on the morning of August 19, 1991? Recollections of the putsch: “that’s it, I thought, here we go to Siberia!” “When I saw those trembling hands (of putsch leaders), I knew it wouldn’t last.”

Such a feeling of history – of having lived through something that the grandchildren would want to hear about.

At the same time, naïve optimism that their emigration abroad will help dig them out of the shit. I try to disabuse them of this and counsel that they rely on their own inner strength. I point out how my German colleagues would like to rebuild the Berlin wall – how we are absorbed in our own problems.

Curious situation –between regimes.  Tallinn is an open city. The border is open. Our Soviets came in here without a visa. Westerners either came with a Soviet visa or got an Estonian visa freely at the border. Soviet currency circulates and will continue to do so for a year more at the least. The Bank of Estonia is a free trading point for the ruble – weekly auctions.  The airport is now under Estonian control. Landing rights are decided locally and are granted virtually for free –2,000 wooden rubles = $50..   Communications in general however remain where they were before the changes.

See Estonian scorn for the lazy Finns, who took the vast Russian market for granted, who made easy profits and were unprepared for the changing terms of trade. Now Estonians aspire to exploit the untapped Russian riches. See our guys’ fascination with timber and mineral resources of Yakutia.

Prices rising fast – rents on state apartment will increase soon 5 – 7 times. Yet two currencies will coexist for an indefinite time. It will be at least one year more before the Estonian currency is introduced and the ruble is phased out.  In the meantime the banking system is drained of rubles.

Meeting with the Bank of Estonia shows remarkable change in some matters. They are quickly establishing correspondent relations with major banks in Europe and the USA. Bank transfers abroad can go through within 2 – 3 days. Currency auctions are open to all Soviet organizations. The rate now is approaching 70 rubles/USD.

A Wild West feeling – wild speculation going on in currencies. Smuggling through the open Tallinn port. People are scheming to recover lost nationalized property. There are gang robberies and muggings. – 15 per day in Tallinn according to police reports.

Radio Luxembourg blares in the Olympia Hotel restaurant at lunch. My television set offers Super Channel sports in the morning. The Music Channel rock broadcasts all day long.

During my stay the formation of the Baltic Customs Union is announced to the press. Common customs policy for Lithuania, Latvia, Estonia – open borders to the West. No internal customs barriers.

Supply situation:  at the hotel Olympia the restaurant is better stocked than on my visit one year ago. I am told that the food stores in town are 30% more expensive than in Moscow but are fully stocked whereas in Moscow the shelves are bare.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Diary notes, Belgium, weekend of Saturday, 21 September 1991

Our 19^th wedding anniversary party – a political debate over the break-up of the USSR

We invite Tanya and Jean, our pianist friends from Namur, and Svetlana and Mark, from Brussels, to a champagne toast at our Braine l’Alleud home, followed by a restaurant in the town. As usual with Russians, the talk turns to politics. Jean becomes fierce in his attack on the stupid break-up of the Soviet Union and its turn away from socialism to a market economy. He says how people will suffer.  Why give up political principles that are essentially good just because they have been abused by villains. I see purple!

Jean shamelessly tells us at dinner how splendidly he had lived in Moscow during his student days at the Conservatory. How like other Armenian/foreign students he had smuggled in gold jewelry (the 2 meter long chains!) which, when sold, enabled him to live like diplomats. How he used tricks to get past the bouncers at better restaurants. How he bought a Peugeot 504 from a Yugoslav embassy official and kept the CD plates. Clearly he was and remains a shameless elitist, epicure, sensualist. He wants 280 million Soviets to remain poor so that he can be rich among them.

Our dinner is mediocre. But our bon vivant friends are not discouraged and we go through numerous bottles of red and white wine, ending in Havana cigars for the gents, the typically extravagant offer of Mark. 

Political debate re-emerges.  I am something of a coq in these matters. Jean backs away, mellowed by the food. But the sting is there –we are clearly standing on opposite sides of the barricades.

I am wholly for the market changes, for the break-up of the USSR, whereby I see each of the republics finding its own worth. I deplore the laziness and egoism of our Western diplomatic community, which is conservative and unwilling to acknowledge the necessity of allowing freely elected democratic parliaments.  The right to self-determination.

As I see it, no one knows who is rich and who is poor in the Soviet Union. All calculations are built on misinformation. Official statistics show what common sense observation denies.

If Tatarstan is poor, it’s only because its vast mineral wealth is being sold cheaply via the Druzhba pipeline to Comecon for roubles. Let the western oil companies in, let the exports go at world market prices and this down-and-out provincial area of the Russian Federation will be among the richest. Ditto Uzbekistan. Now the papers begin to reveal the truth about its status which official data concealed for reasons of military secrecy. The large gold production, which is second in the USSR after Russia and ahead of Kazakhstan, did not appear officially because the gold mining was conducted in the same fields as militarily operated uranium mining and was enshrouded in state secrecy.

The despoliation of all resources in the Soviet Union, the rape of the land, was legendary. Now control must be turned over to the indigenous peoples. They must assert national interests and must understand their worth on the world stage before any recombinations are possible.

Those in the West who ask how these republics can survive on their own are empty rhetoricians. Let’s take Estonia, for example: a tiny population of under 2 million of whom one-half are Russians, Ukrainians and other non-natives; a land without mineral resources, whose economy is founded on agricultural products which are already over-abundant in Europe. Fine, but Estonia is situated geographically in the position of transit crossroads from Finland-Scandinavia to the south. They rightly emphasize the potential for developing roads to allow a north-south route in the east, where the ecological restraints are not so severe on truck transit as in the pampered West, passing through Germany.  Moreover, the Estonians seek to develop their banking activities as financiers of East-West trade.  In a word, they’ll survive quite nicely by rendering services to their bigger and more powerful neighbors. Why then should they be compelled to participate in a union which has been till this past August the vehicle for trampling on their rights.

Jean and I are indeed far apart. He’d do better to mind his music and not his politics. I will not mourn the passing of the black market days of the past.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Yugoslav civil war – where do the Great (and Little) Powers stand?

Diary notes,  Sunday evening, 7 July 1991

The past week was filled, filled with impressions and interesting developments.

This was moving week, getting installed in Neuenhofer Allee, Cologne, now that my new UPS offices are here, at the Cologne Airport.

 Larisa and Alexa drove down with me last Sunday as I once again took rooms at the Crowne Plaza Holiday Inn. On Tuesday we spend the day in the apartment as movers arrive. How wonderful to see again all of our antiques which had been in storage in Dortmund for the past 15 months. Set out in the new apartment, it looks fine. The ceilings may be too low at 2.5 meters (!), and it is a pity that our living and dining areas are in one room, but otherwise the good state of the apartment house shows off the mahogany and fruitwood very well. By the time they leave at 5.30 everything is in its place. Specialists will come next week to install the chandelier and to mount the mirror and paintings on the walls.

On D-day, as the movers put in the last pieces, one of our two neighbors on the landing invites all three of us in for tea. Very nice gesture. Larisa sits there like a dummy, but I carry on in German for half an hour about my job, about his retirement and about their apartment in Calpe. Nice people. We have been in Belgium for 11 years and no one has done for us what they have done on the first day.

The week is a hot one. It is the first warmth and summery weather since April. Temperature soars into the low 30s C. Our hotel air conditioner cannot keep up. It is a great time to discover our local beer garden. I invite Nigel and Axel over there and we all have a splendid time over Kolsch.

This is also a hot week in Yugoslavia. The military conflict has intensified since the declaration of independence of Slovenia and Croatia the previous week. Our flights into Zagreb for UPS are touch and go each day. Ljubljana airport is closed after being bombed by federal troops.

I am pleased that at long last Yugoslavia’s big lie has been exposed and the craving of these very different nationalities for self-determination has taken over. At first the reactions of the EEC and especially of the USA are bitterly disappointing. The functionaries in the State Department and their European counterparts in the various chancelleries clearly don’t want their summer holidays to be interrupted by the damned Yugoslavs. But then as the viciousness of the Serbian Communist generals becomes apparent, Kohl and the Austrians are the first to break ranks with all others and to threaten to recognize the independence of the republics. This then becomes EEC policy and even the USA and UK finally, grudgingly agree that Yugoslavia need not hold together.

From among the E. European leaders, the Hungarians and especially the Czechs under Havel come out on the side of the ‘rebels’ and the cause of self-determination. Poland’s Walesa comes out for law and order.

It is remarkable to be living through a situation so reminiscent of the Holy Alliance, where the existing states conspire to thwart emergence of new states from the dying communist order. Bush as Nicholas I.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]

Travel notes, Kiev.  Ukraine on the path to independence

Monday, 29 October 1990

First visit to Kiev in 24 years. Painful after Chernobyl, which is only 60 miles away as the crow flies. The ‘green city’ they call themselves, as if that were a compliment. It’s a contradiction in terms.

Morning – we go to see the Pechersk Lavra – don’t get very far. Join a Soviet group. The guide is on missionary work, strongly anti-Soviet. She tells how Bolsheviks murdered the prelate and monks, how in 1919 Lenin cynically ordered the plunder and shootings. All the horrors, up to our day. Rather fuddy-duddy group of Soviet ladies. But occasionally it’s clear that the guide lands her punch. She gets through the twaddle in their brains. Scandal of yesterday at the Sophia, where fighting broke out in a protest inspired by Ruch  (Ukrainian nationalists) over participation of Russian Metropolitan Alexei in the sanctification of the church.

Afternoon – visit with deputy minister of transport Reva, who grants us only one hour, because he is a parliamentarian and at 4.00 they assemble to elect a new prime minister, the result of a students’ hunger strike. Reva says that Ukraine is going ahead with full independence – sovereignty; is setting up its own embassies abroad, starting with Hungary, and will establish its own foreign ties in all international organizations. This is historic – signals the break-up of the Soviet Union if the most populous non-Russian republic walks out. 52 million population. Reva himself is clearly Russian, as is over one-third of the Ukrainian population.

Dinner at a dacha.  The refrain – “Moscow is milking us.” The dinner is staged in imitation of Chernoivanenko’s dacha feast in Odessa, about which our hosts have of course heard. It’s all rather civilized. The dacha itself is a two story affair, and we are perched in the second story with its big ceramic tiled fireplace, which is lit and for a time fights off the frost, though for the last hour I sit quietly freezing. There is a splendid oak parquet floor – better than in Moscow’s best hotels (why do Muscovites always manage to turn parquet into butcher-shop floors?).

The table is spread with Caucasian specialties as our host is Armenian. Marinated patissons, red tomatoes, garlic cloves, wild garlic, stuffed grape leaves. The pièce de resistance is a beef filet mignon barbecued. Drinkable brandy as well as vodka, all consumed with relative moderation. Our hosts are planning to visit the USA, where a friend is living. Business talk moves on to the impending independence of the Ukraine – how to attract investments. I stress that the West has other priorities, so if any large firms are thinking of setting up shop here, grab them; don’t try to fence them in.

Tuesday, 30 October 1990

“Our meeting with the Autotrans group goes badly. November 1^st there will be a new exchange rate. The commercial ruble is being devalued to one third of its old value and our talking partners want us to give them all the implicit gains from this change-over. My point of view is that till now we Westerners were constrained by law – the Soviet ruble was overvalued but we could do nothing. Now the ruble is finding a more reasonable level and any confrontation over what we pay for goods and services will be between us and our Soviet business partners. We are ready for such a fight. We will compromise but we will not automatically yield to the other side the benefits of devaluation. Over the past year, as the dollar devalued, we put up quietly with rising costs in the USSR.  Now it is our turn to benefit and the other side will shut up. We will increase our dollar payments only to the extent that the dollar costs to the JV have risen.

Unfortunately the leader on the Ukrainian side, director of the Auto Base…is not up to the challenge and we break off the talks without results.

On the plus side, we discover a possible alternative local partner in the newly created Business Development Center at Hotel Salute. The clever young Soviet manager of this JV outfit seems interested to promote our service as part of his infrastructure offering to foreign businesses. We make our offer. He’ll think it over.

The other major complication is that Kurshin tells me he is thinking of leaving the JV. The story is that Sovtransavto boss Tatishvili forced him out as revenge for his independence during the board meeting in Helsinki. True or false? Maybe.

In any event Kurshin last Friday was elected President of the Soviet Truckers’ Association group in charge of negotiating bilateral agreements with foreign countries. A modest salary but frequent trips abroad. The position of a power broker in a fast changing political situation.

We take dinner together and over half a liter of whisky he tries to seal our personal relations. Tells about his past. In ’39, his father was the chief engineer of Gulag. It all lasted one year, on the Belomorkanal project. Then he was lucky to get out with demotion to a factory directorship. Later he also served the NKVD as head of a factory employing minor offenders. He reveals that his grandfather was a member of the first merchants’ guild of Moscow, a wealthy man with a townhouse in Moscow.

Arkadi wants to keep the door open for a possible return to UPS if and when we break with Sovtransavto and set up our subsidiary. To ingratiate himself, he says he was asked by the KGB if I’m a spy when I applied for a multiple entry visa. Gentle hint that he has friends going back to his father. I’m neither surprised nor shocked. One thing for sure – I do not match his ‘confession’ about my nationality or skeletons in the closet.

Whom to name to succeed him? Better someone from inside, not to start all over again with someone else. Nor do we give Tatishvili the upper hand in our JV.

Jokes from Kiev:   we pass new luxury housing block “Vnukovo” built for the grandsons of the nomenklatura.  Or the KGB headquartrers is the tallest building in Kiev – from there you can see Siberia.

Tuesday was Political Prisoners’ Day in Moscow  with a large demonstration on Dzerzhinski Square. Kurshin wants to watch it on television.

We take a little car tour – past the St Sophia – which is really disappointing – just another Russian church. For some reason I expected the grandeur of Hagia Sophia (Istanbul). The cupolas here are just some more onion shapes. On the other hand Rastrelli’s 19^th century Andreyevski Sobor is magnificent – a blue and white baroque jewel. We descend the cobbled road into the Poddolia, the fine baroque part of the city just starting to be rehabilitated.

Uneventful flight on Aeroflot TU134 from Kiev to Berlin’s Schoenefeld airport. My fellow passengers are a talkative American lawyer turned journalist who proudly shows off his accreditation to Vecherny Kiev for the USA (pay to be all the rubles he can eat). On the other side, a German based manager for General Electric who is a good Russian speaker. A bit on the glum side. Confines himself to travel to Leningrad, Moscow, Kiev. Remembers his ’76 trip to Khabarovsk, as one of the first foreigners. At the time he took an Intourist guided tour and at the lookout point over the Amur asked if it was far to China. The guide said yes, very far; a Chinese standing just nearby said – just look at the hills across the river, that’s China – and the guide turned crimson

As I leave Schoenefeld (where customs inspection is more like the old DDR than like the new BRD), I take a Wartburg taxi and get at once caught in the new traffic jams which seem to be clogging all arterial roads. Takes about an hour to reach Tegel. Lufthansa has played a dirty trick – my direct flight to Brussels is subcontracted to a small turboprop – so we get well bounced around in the high winds by the time we land in Brussels.

©Gilbert Doctorow, 2020

[Memoirs of Russianist, Volume I: From the Ground Up in now in print and available on all national websites of Amazon.com, as well as from other leading online retailers including Barnes & Noble, and http://www.bol.com.]