AH CAIN’T SAY NO….
The elegant managing director of the International Monetary Fund, Michel Camdessus, lacks Ado Annie’s vibrant diphthongs, but the sentiment is the same. The Fund continues to talk about new loans to Russia. An IMF mission to Moscow met with First Deputy Prime Minister Yuri Maslyukov and Finance Minister Mikhail Zadornov, among other officials. World Bank President James Wolfensohn also passed through town. Prime Minister Primakov stood him up (his bad back would not let him stand), but Wolfensohn spoke to ex-PM Viktor Chernomyrdin, who immediately told the press that the World Bank might put another $3 billion into Russia.
Talk about filling a leaky bucket. The Wall Street Journal reports estimated illegal capital flight from Russia at $1.5 billion a month. At that rate, Mr. Wolfensohn’s generous contribution, if it comes to pass, will keep the millionaires happy for sixty days; the rumored $3.8 billion–$4.8 billion from the IMF would last into the fall.
To stem the flow, the Central Bank issues ever-more-complex rules on foreign-currency transactions, fashioning an intricately ineffective regulatory macrame of loopholes. The ease with which Russian wealth is stashed illegally abroad may explain the surprising 26-1 ruble-dollar exchange rate: There is relatively little demand for dollars in regulated legal markets.
As for the hard work of collecting taxes, controlling expenditures, policing markets and generally doing what governments minimally must do to promote economic stability and honest enterprise, the Primakov government has accomplished essentially nothing since taking office last September.