Russian Parliament Rallies Against Yeltsin After Ruble's Fall
RUSSIA'S political landscape was thrown into turmoil yesterday, with parliament poised to take a vote of no-confidence in the government, as President Boris Yeltsin fired his acting finance minister and took steps to sack the Central Bank chief.
For the first time, parliament's lower house, the State Duma, mustered a two-thirds majority vote to override a presidential veto on a budget bill, heralding a new mood of defiance against the Kremlin.
The firings and parliament's show of strength followed a plunge by the ruble on Tuesday, when the Russian currency lost 21.5 percent of its spending power against the dollar - while the dollar buys 27 percent more rubles - sparking fears of financial chaos.
Prime Minister Viktor Chernomyrdin cut short a holiday on the Black Sea and rushed back to Moscow to defend his economic- reform program.
Mr. Yeltsin told his influential security council that he regarded the ruble's nose dive on Tuesday as a deliberate act of sabotage, and named a former KGB security chief to investigate possible causes.
The flurry of political fallout came despite a partial recovery of the Russian ruble, which bounced back 5.1 percent on the Moscow Currency Exchange in yesterday's session, from Tuesday's all-time low of 3,926 to the dollar.
But the increase could not save acting Finance Minister Sergei Dubinin, who was appointed to the post in January. Two pro-reform deputy finance ministers, Sergei Aleksashenko and Andrei Kazmin, said they would resign if he was not reinstated.
The ruble's collapse embarrassed the government and prompted fears that its pro-reform economic program could be endangered by financial instability. It also provoked anger on the streets of Moscow, where the prices of imported goods skyrocketed on Tuesday afternoon.
Business drops off
``It is terrible that prices have increased so dramatically, because people now can't afford to buy anything,'' said Svetlana Kromina, a young woman who works in a kiosk selling everything from fruit drinks to candy bars. She said that business sharply dropped off following the ruble's slide on Tuesday.
``They're fooling the workers. My salary shrank one-and-a-half times [in value] since yesterday. This is blatant robbery of the people, and nobody will be held responsible for it,'' construction worker Alexander Rotov said.
Yeltsin yesterday sent a formal request to the State Duma to sack Central Bank head Viktor Gerashchenko, widely blamed for the ruble's tumble. Mr. Gerashchenko, who stopped intervening to support the ruble two weeks ago, is appointed by the parliament on the president's recommendation.
Gerashchenko took partial blame for the ruble's fall, telling the Ostankino television that perhaps the bank did not act quickly enough. But the bank has also blamed the crash on speculators and said it will not back up the ruble with hard-currency reserves, which some reports put at less than $6 billion.
``Mr. Gerashchenko was a Soviet banker. If they find a respected, stronger, market-reform oriented banker, that would be good,'' one Western diplomat said.
Although the Central Bank chief has never been popular with reformers and has enjoyed support in parliament, deputies enraged by the ruble's fall overcame their differences for the first time yesterday to overrule a presidential veto of a bill that will tightly control the Kremlin's budget policy.
Parliamentary Speaker Ivan Rybkin also put a vote of no-confidence in Mr. Chernomyrdin's government on the Duma agenda for Oct. 21, at the request of a centrist opposition party, the Democratic Party of Russia.
Since the Duma opened its autumn session last week, suggestions that the opposition might try to flex its muscles with a no-confidence motion have been rife. But opposition factions have been so divided among themselves that until yesterday they had been unable to muster a sufficient majority to pass the motion.
Sticking to the plan
By an overwhelming majority of 310 to 6, though, the Duma insisted yesterday that the government stick to a parliament-dictated timetable while formulating the 1995 budget. Yeltsin had vetoed the original bill, but it was overridden yesterday. The upper house, the Federation Council, must also pass the bill by a two thirds majority for it to become law.
The new sense of purpose in the Duma contrasts sharply with the mood only a few days ago, when three key opposition factions briefly boycotted parliamentary sessions.
The Communists and Agrarians supported Vladimir Zhirinovsky's Liberal Democratic Party, which accused the government of systematic persecution.
Yeltsin, however, was not alone when he accused enemies for sabotaging the ruble and chose political scapegoats to take the blame for the plunge.
``There are forces out there who do not want to see the government in full control. Now we need to find out who all these speculative political and commercial forces on the foreign-exchange market are,'' Economics Minister Alexander Shokhin told Ostankino. He threatened to punish ``illegal'' currency transactions on the foreign-exchange market.
Conspiracy theories were a hallmark of Soviet official thinking. Analysts have complained this week that Gerashchenko was in cahoots with exporters who wanted to deliberately deflate the ruble to boost their sales.