NEFTEYUGANSK, U.S.S.R. -- "This is one of the richest places on earth -- we have oil, gas, forests, fish," said Viktor Sederenko as he showed a visitor around the 30-foot-long trailer his family has called home for the past seven years. "We should be millionaires by now."
Situated in the heart of the western Siberian oil fields, the Nefteyugansk region alone pumps nearly as much oil as Kuwait. Its natural resources have earned the Kremlin billions of dollars in hard currency, but tens of thousands of its inhabitants live in shantytowns.
In the spring, the unpaved roads turn to mud. The city lacks kindergartens, schools and hospitals. Crime is rising by 180 percent a year -- faster than anywhere else in the country -- but police cars are allocated only enough gasoline for three or four hours a day.
The glaring contradiction between the natural riches of Nefteyugansk and the degrading living conditions of its inhabitants reflects a challenge facing President Mikhail Gorbachev as he attempts to remake the Soviet Union.
For the past two decades, Siberia's immense oil wealth enabled the Kremlin to maintain the burden of both its "internal" and "external empire" -- Petrodollar revenues helped to subsidize the Soviet economy as well as provide aid to East European and Third World nations. But Russians are increasingly questioning the logic of an economic system that has left them picking up the crumbs at their own banquet.
"Nobody here derives any advantage from all this oil," said Vladimir Moskovkin, a Nefteyugansk engineer who led a popular protest against poor housing conditions and environmental damage that toppled the city administration last December. "We just extract it and send it off. You would have thought that it would benefit me as a person, my family, my neighbors. But our lives are getting steadily worse."
"We never saw any of those petrodollars," agreed Vitaly Sevrin, a Communist reformer elected this month as the city's new mayor. "But we know that they weren't used very efficiently."
Oil from Nefteyugansk -- whose name derives from nefta, the Russian word for oil -- has been exported all over the globe, much of it at subsidized prices. Soviet economists calculate that East European countries have been paying at least 40 percent less than market prices for Siberian oil. On the domestic market, Nefteyugansk oil is sold for just three rubles a barrel, a fraction of the international price of about $15 a barrel.
Last year, the Kremlin struck an implicit bargain with the East European countries that make up what had long been regarded as the Soviet Union's "external empire." In return for their political liberation, Soviet trade subsidies were phased out. Beginning next year, East European countries will pay market prices for Siberian natural resources in freely convertible, Western currencies.
There is now talk of a similar trade-off between Russia, the Soviet Union's largest republic, and the 14 other republics -- the so-called "internal empire" -- many of which are demanding "political sovereignty," in some cases full independence. They want the right to choose their own economic and political systems without interference from Moscow. In return, the Russian republic, which extends across Siberia, is demanding "economic independence," the right to dispose of its huge natural resources at free-market prices.
The basis for this putative new relationship is a growing realization that the old system of centralized economic management benefited nobody. Russia became what Soviet economists describe as "a raw material appendage" for the other Soviet republics and for Eastern Europe. Its client states were saddled with grossly inefficient economic systems that blocked their development.The Costs of Stalinism
Four decades ago, Soviet dictator Joseph Stalin set a seemingly impossible goal of producing 1 million barrels of oil a day. Once that target was met, he declared, Communism would finally be achieved.
"We are now extracting 12 times more oil than Stalin ever dreamed about -- but we still don't have Communism," joked Yuri Trifonov, chairman of the oil workers union in the Tyumen region of western Siberia.
Under Stalin and his successors, the Soviet economy came to resemble a gigantic machine whose main purpose was to keep itself running. Since raw materials were cheap and abundant, little thought was given to their preservation for future generations. Economic growth was achieved not by saving energy, but by consuming as much of it as possible. The average Soviet factory uses two to three times as much energy and other raw materials as a Western factory to generate the same output.
The costs of the Stalinist model of extensive development are most clearly visible in Siberia -- in the pillaged environment, the shabby industrial infrastructure, the empty shops and appalling housing. Nowhere else in the Soviet Union have the needs of the individual been so obviously subordinated to the demands of the state.
"For years, the politicians in Moscow have looked at our region as a source of raw materials. Their only concern was how to extract as much oil as possible," said Vassily Veryovkin, a labor union organizer in Nefteyugansk, which has a population of 100,000. "When the oil runs out, they could close the whole place down. But what about us?"
Roughly one-third of the 700,000 oil workers in the Tyumen region live in substandard housing, according to official figures. (By law, every Soviet citizen has the right to at least nine square meters of living space). In Nefteyugansk -- which was founded in 1967, at the beginning of the oil boom -- an entire suburb consists of nothing but metal wagons designed as temporary accommodation for oil workers. It has a somewhat ironic-sounding name -- Zvezdni, or Star City.
"I am considered one of the luckiest people in Zvezdni. We have an indoor toilet," said Sederenko, who arrived here from Uzbekistan in Central Asia in 1983. The Sederenko family -- Viktor, his wife Natalya, 12-year-old daughter Olga, and 9-year-old son Sergei -- all sleep in one compartment of their trailer. The other compartment serves as the family living room.
The Sederenkos' neighbor, Evgenii Malikov, built an outdoor toilet with three other families. The most difficult time, he said, is in winter when temperatures can drop to 40 or even 60 degrees below zero. The toilet is 50 yards down a muddy, unlit street.
Like many vagonchiki, as the trailer dwellers are known, Sederenko and Malikov were attracted to Siberia by the relatively high pay. Wage levels are two to three times higher here than elsewhere in the Soviet Union, but money is of little use when there is nothing to buy in the stores.
At Food Store No. 64 in Tyumen, the administrative capital of the oil region, the items on sale were porridge, lard, milk, margarine, eggs, thousands of jars of tomato paste, three kinds of dried soup, mineral water and canned sardines. The meat counter had a few scrawny chickens and some dried mackerel.
A few years ago, many Tyumen workers were willing to put up with poor living conditions because they had no measure of comparison. But Gorbachev's policy of glasnost, or openness, has changed all that. Recently, Soviet television aired a series of films about life in Kuwait, and the vision of supermarkets overflowing with Western goods, bathrooms with gold-plated faucets and Bedouins driving Cadillacs quickly became the talking point of the Soviet oil fields.
"My Kuwaiti counterpart has six automobiles, a three-story villa and a salary of $12,000 a month," said Trifonov, the labor union chairman, who is leading a campaign for the Tyumen region to retain control over at least 15 percent of its oil wealth.
In March, the Tyumen oil workers threatened to go on strike for improved living conditions and a fairer allocation of the region's natural resources. After consultations with Moscow, the immediate danger of a walkout was averted, but the threat caused alarm among Soviet officials, who are well aware that any strike in the oil fields could have devastating economic and political consequences.The Sovereignty Bandwagon
"Economic sovereignty" has become the trendy new slogan for Russian politicians. At the Congress of Russian People's Deputies, the republic's supreme legislative body now in session in Moscow, radical reformists have vied with conservatives in pledging to look after Russia's interests. Even senior Communist Party officials have been forced to climb on board the sovereignty bandwagon.
Just over half the Soviet population lives in the Russian federation, a vast territory that stretches from Europe across Siberia to the easternmost tip of Asia. But Russia produces more than 90 percent of the Soviet Union's total output of oil and timber, 76 percent of its natural gas and 80 percent of its hard-currency revenues. Some Russian nationalists have already begun to ask -- only partly in jest -- whether it would not be sensible for Russia to secede from the Soviet Union.
"Russia has played the role of older brother in the union for too long. The younger brothers have been stealing from our basket," complained Alexei Sergeyev, a conservative economist, who claims that Russia loses more than $50 billion a year through deliveries of subsidized raw materials to the non-Russian republics.
According to traditional Marxist theory, a metropolis is expected to exploit its colonies, selling them high-priced industrial goods in return for cheap raw materials. Russia, which in 1917 established the world's first socialist government, has now become the most celebrated case of the reverse phenomenon.
"Ordinary people have finally begun to realize that they have got nothing out of the oil boom," complained Lyudmila Mikhailova, a professor of ecology in Tyumen. "We sell our raw materials for practically nothing in exchange for expensive finished products."
Calculating precisely how heavily Russia subsidizes the rest of the Soviet Union is difficult because of the country's artificial price structure and convoluted accounting practices. A Lithuanian parliamentary commission recently estimated that the republic would have to pay some $60 million a month in hard currency if forced to find alternative energy sources. Most of the other non-Russian republics are in a similar situation.
Another form of hidden subsidy to the non-Russian republics is the inflated prices they receive on the domestic Soviet market for industrial and agricultural goods they sell. A disproportionate amount of the overpriced goods is produced by the Baltic republics. Prices of some electronic equipment, for example, are two to three times world market prices.
The growing resentment among Russians over such subsidies could develop into a powerful political force. During local elections in Tyumen this year, members of a Russian nationalist group known as Otechestvo, or Fatherland, won a third of the seats in the city council. Radical politicians who advocated a transition to a Western-style market economy now are trying to recoup lost political ground by beating the nationalist drum.
Campaigning for the presidency of the Russian republic, populist politician Boris Yeltsin said that Russia should start charging world prices to other republics for its natural resources. He also called for Russia to have its own monetary system. His proposals were promptly condemned by Gorbachev as tantamount to the breakup of the Soviet Union.
But Gorbachev is coming under mounting pressure from both the Great Russian "metropolis" and the non-Russian "colonies" to untie the bonds of empire. Most Baltic residents seem prepared to accept the short-term sacrifice of a lower standard of living in return for political freedom and long-term economic opportunities. Many Russians, meanwhile, are asking themselves why they need an empire if their own lives continue to be so wretched.
There have long been two types of Russian nationalism. One, represented by Stalin, was based on the belief that Russia could only be great if it controlled surrounding territories and peoples. The other, which seems more in vogue today, is essentially isolationist -- Russia should look after its own people first.
A recent article in the Soviet journal Moscow News compared what was happening to Russia today with the fall of the Roman Empire. Historian Lev Gumilyov suggested that Gorbachev would do well to follow the example of Emperor Augustus who, after a period of horrible civil wars, announced the beginning of an era of "golden mediocrity."
Asserting that millions of people in the Soviet Union had been denied "the chance to mind their own business," Gumilyov said that the ideology of "golden mediocrity" had assured Rome a prolonged period of "prosperity and normal life." "Let's hope a similar epoch is approaching in the Soviet Union," he declared.
Russia sells its oil to other Soviet republics at below-market prices, but imports consumer goods at above-market prices. The result is exorbitant costs for consumers.
This prices of items shown here are expressed as a percentage of world market price.
SOURCE: Radio Liberty Research