[War] Russia: "Money Talk"

[Michael Downey]

"Money Talk"
President Leonid Nemerenko
Russian Federation
8 January 2014
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"I love capitalism," Nemerenko said as he poured himself a small cup
of tea from the Romanov-era set, a little souvenir of Lenin's that had
passed into the hands of every Russian leader thereafter. "When I was
a young man and my father was a member of the Supreme Soviet he once
showed me a recording of a speech by Deng Xiaoping. He said that our
Chinese Communist counterparts had the right idea, that the free
market could design and produce anything and everything better and
more efficiently than our bloated communist system. I mean how many of
us here looked to the West and longed for an economic system like
theirs back during the wanning days of the Soviet Union?" In their
hearts all of the USSR's leaders had known what was coming. Some like
Yeltsin had embraced it while others like the GKChP that had briefly
overthrown Gorbachev had been terrified it and almost plunged the
country into civil war to prevent the inevitable change.

"It had been a hard road from communism to capitalism," said Ivan
Lencuovich, the Minister for Economic Development and Trade. "Xiaoping
was careful in his reforms and maintained a dictatorship over his
state. The Soviet system broke down almost immediately and Yeltsin was
forced to grapple with making Russia into a democracy and a free
market economy all at once."

"Yes and it was not an easy road at all," agreed the President with a
nod. "I respect Yeltsin for what he did and the progress he did make
on those fronts but in many ways he failed. Our original transfer to
free market was haphazard and flawed and Putin very nearly turned this
country into a dictatorship. President Severov's election was almost a
mini-revolution for Russia and his economic and social reforms truly
made us into a an actual democratic, free market state and not the
quasi one that Yeltsin worked himself to make." Nemerenko smiled and
sipped his tea. "But enough reminiscing about the past. Today things
have improved. Since last year the economy has grown 2.6%, a modest
but still positive number. The government has continued with
macroeconomic reform such as the overhaul of our banking and credit
industries to conform to World Bank and WTO standards and the
introduced of the SMESD Act which reformed our corporate laws and got
rid of all that bureaucratic red tape and mismanagement that was
plaguing our economy."

"There is still certain areas that need improvement," noted
Lencuovich. "First and foremost, the corporate world here in Russia is
dominated by men. Women have had a hard enough time penetrating into
the middle management sector and have made no headway into upper
management. Equal economic opportunity for both men and women is
important for future development and growth. I've had my Ministry draw
up a bill based upon a program the Norwegians introduced back in the
first part of the last decade mandated that the Board of Directors for
every publicly traded company have 40% of its membership comprised of
women. The bill we've drawn up requires all publicly traded
corporations in Russia have 15% of their board of directors made up of
women, to be done within three years."

"Not that I disagree but it might be difficult to implement," observed
Nemerenko. "Isn't this the kind of government intervention into the
private sector we said we'd try to avoid?"

"How and who the companies appoint is totally in their hands. And the
novelty of such a law in Russian economic culture is why we set the
provision at only 15%. I know gross state participation was what made
Putin such an idiot when it came to running the economy, but
government does have the responsibility to ensure competition is fair
with equal opportunity for every groups, company and individual."

"Fair enough, I'll put the bill to the Assembly. You also wanted to
talk about Gazprom?"

"Our state oil company has become very profitable over the past ten
years or so," said Lencuovich. "Despite all the moves towards
renewable energy oil is still very profitable. But the price of oil is
not what I'm here about. Under Putin Gazprom grew into some sort of
dystopia mega corporation. It diversified itself from energy into
banking, agriculture, media, insurance, etc"

Nemernko was well aware of what Gazprom has become under Putin. A
state within a state run by the man's cronies and subordinates. There
had even been moves by the company to create its own private army,
something that had quite a stir in the Duma and nearly forced Severov
to step in with Federal troops when he took office.

"We've of course cleared out the company leadership of pro-Putin
members and replaced them with administrative personnel interested in
making sure the company runs properly and not lining their own
pockets," continued Lencuovich. "Gazprom should be what it what it was
originally intended to be: an oil extraction company under the
ownership of the federal government. All it's interests outside of oil
should be immediately. Half of the company's controlling stock in
these areas will be given to employees of said subsidiaries, the other
half sold on the open exchange. As with the privatization of
state-owned banking groups last year, extreme care will be taken to
ensure said shares are sold properly and fairly and not to potential
oligarchs. It will make Gazprom easier to operate, create more
competition, give something to the workers and raise some revenue for
us."

The President nodded his consent. "Speaking more on the subject of
state-owned companies, I wish to inquire about how things with
Rosimushchestvo." 'The Russian Federal Agency for Federal Property
Management of the Russian Federation,' or Rosimushchestvo, was the
quasi-corporate entity responsible for overseeing all the Russian
government's various corporate assets and interests, Gazprom being
one.

"In conjunction with the MVD we have been doing extensive background
checks on all Rosimushchestvo employees," answered the Minister.
"Surprise audits and inspections have weeded out any corrupt elements.
I've recently appointed a new Director who I can personally attest is
both competent and trustworthy."

Fighting corruption in the government and military was one of the
highest priorities on Nemerenko's legislative agenda and he had
demonstrated, subtly and not-so-subtly, how harsh and intolerant he
would be towards said corrupt elements.

"I'm pleased with the progress your Ministry has made Ivan," commented
Nemerenko. "I am this new initiatives will prove very fruitful. Keep
me informed of all developments."
---

Actions:
1) Introduce legislation that will require all Russiam corporation to
have 15% of the board of directors membership composed of women within
three years.
2) Sell all of Gazprom's interests outside of the oil sector (which
includes banking, insurance, media, agriculture). Half of the shares
in these subsidiary interests will be given to the company workers,
while the other half will be publicly  traded. Take steps to ensure
the selling of said shares will be fair and in keeping with
competition laws.
3) Continue to weed out corrupt elements within the Russian
government. Take special care to ensure proper practices in
Rosimushchestvo, the Federal agency responsible for managing the
government's corporate assets.