Those Who Count -- Apartheid Lives On

You can them driving all over Moscow, especially when you're in their way. They race up behind you, flash their lights and blast their fire engine style horns to order you out of the way. They often sport blue flashing lights to further assert their status as they race by at unsafe speeds. These Blue Light Specials were not emergency vehicles on the way to save lives but the cars of Those Who Count. For $20,000 or a connection, you get the right to blow by GAI check-points and drive down the "Chaika Lanes", the special middle lanes in major roads formerly reserved for the Chaika limousines once used by senior Soviet Communist Party officials. Since most roads only had one such lane, it was always amusing to see what happened when two cars came head on. The result of this game of chicken was based on the perceived status of the driver, which seemed difficult to figure out as cars raced towards each other at 60 mph/100 km/h. Oddly, somehow they always seemed to figure it out -- I never saw a Blue Light Special crash.

The hierarchy's pinnacle was the President of Russia. When he was going by, traffic was stopped for at least 20 minutes as a hoard of black cars, fancy Mercedes police cars and motorcycles roared by. For anyone who spent time in Washington DC and seen the Clinton/Bush Crossings, this was all pretty normal stuff. The Russian Prime Minister also got a nice stretch Mercedes with a cool green and gold flag on it. Again, this was not too odd. What was peculiar was the proliferation of other vehicles that also ruled the roost. There were the black Audis that belonged to the Presidential Administration and have Russian flags on the license plates. Since the drivers got paid miserable wages, these cars made very cool taxis. There was nothing quite like racing down the Chaika lanes encased in leather bound luxury when you're running late. There were the blue plates that belonged to the Ministry of the Interior, the black plates of the army, and finally the red plates of the diplomats. The latter seem to have come down the hierarchy quite a bit since the USSR died. Although they were no subject to constant surveillance in 1998-2001, they did get harassed when Russia was angry at their country. During Yugoslavia War, cars baring US diplomat "004D" plates were stopped several times a day. The city of Moscow also had its favorites. These cars had plates with three "O" on them. The acronym "OOO" roughly corresponds to the English "VIP".

Most of the OOO and other such cars belonged to the New Russians, those who made a ton of money cleaning up after the USSR died. These people lived in another world. Their favorite cars were Mercedes S500 or S600 -- getting seen in anything less was gauche. No New Russian would be caught dead driving anything less than a V-8, although a V-12 was better. These guys also loved the stretch BMW L7 V-12, and gangsters were especially fond of the hideously boxy Mercedes G500 SUV's. Most of the G500’s also had huge bumper extensions to make them look even nastier. The best color to get was black, with silver a distant second. The point of these cars was to impress -- and intimidate enough to keep the bad guys away.

The New Russians lived in enormous houses on the west side of Moscow and hung out in clubs such as "Most”, which had a $40 cover charge. When I looked inside the place, I did not see anything special except a lot of very well dressed people trying to look important. It wasn’t even fun, like most Russian clubs. Maybe it was because these were the same people who were "bored" with Paris because they've been there so many times. They thought nothing of paying $20 for a drink and would happily pay $2,000 for a Chanel pocketbook or a Zegna suit. Beyond the cover changes, these clubs were also kept exclusive by Gestapo-level "face control" which meant if they don't like your suit, car or face, forget about coming in. One club manger told me that he hired professional actors and bartenders to better select those worthy of entering his club. Supposedly, they could always tell the difference between the desirables, troublemakers and those not cool enough to be let in (or those only deemed semi-acceptable and must wait in line). The choosers discretely watch people and radio ahead to the flathead goons at the door who use their muscle to keep undesirables out. While in a few clubs this meant not being white enough, for the vast majority it meant not looking rich enough.

Moscow was also filled with glittery casinos for high flyers covered with so much neon they made Vegas look tasteful. If you're not in a suit and willing to buy US $100 in chips forget places like Shangri-La, which is located on Pushkin Square, right behind a famous statue of the bard himself. Knowing Pushkin’s partying lifestyle, he might have liked the place. The casinos were also marked by high end prostitution and the hordes of girls throwing themselves at rich guys. Judging from the number of women, it looked pretty hopeless for anyone hoping to land Mr. Right. At best, they might land a Mr. Tonight.

Since 1991, the Russian aristocracy changed from society of privileged cadres with access to "special" facilities to one based on access to meaningful US Dollar incomes. During Soviet times, most people lived stable but plain lives marked by shortages of assorted consumer products such as toilet paper, shoes, cars, meat and most other products. But they could all get by, if not that well. In the New Russia, wages were so low that many people had trouble buying anything more than the essentials -- although economic change had dramatically increased the availability of goods. But most people couldn’t afford what's around, making consumption a case of “so close and yet so far”. For the majority of people, capitalism was a tease.

Unlike most Russians who were stuck in the ruble economy, the rich kept their money overseas or they kept cash dollars at home as a hedge against yet other crisis. When they needed rubles, they would to ubiquitous the Exchange Points (Obmen Valuty) to get money. I often found myself making "Obmen runs" to get rubles because rampant inflation discouraged me from keeping them for long. The result was that Russia was a two currency country and that Moscow was one of the easiest places in the world to exchange money. Russian currency exchanges were not just overpriced "tourist" things with outrageous service charges, unlike many places elsewhere. The locals did far exchanging than foreigners, which resulted in extremely competitive rates between Obmen. The buy-sell spreads were so small that I wondered how they were making money. Who can make money if an Obmen buys dollars at 12.00 and sells them at 12.01 rubles? I later noticed the 2 percent fee required to change rubles into dollars. Mystery solved.

Inflation also changed the way business work. Being sensibly averse to currency risk, they often priced expensive products in "Universal Equivalents" (UE) where ruble prices changed with the dollar - ruble exchange rate. Stores were not allowed to quote prices in "dollars" because it was illegal to sell things for hard currency (although people in practice would). But most high-end products were priced in UE, further highlighting the important distinction between those with dollars and those without. People with money participated in the expensive UE economy while most others could not. In the New Russia, those with money rather than party connection counted. The country had joined the world.


Note: This is only a partial excerpt of the book, which is available on request.  I will be adding photos to this page in the near future.



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