Official Says Russia in Peril

The current government of Russia is in a precarious economic and political position, Deputy Executive Director of the Russian Federation Aleksei V. Mozhin said last night in a speech sponsored by the Harvard Business Club.

Approximately 30 people turned out to hear Mozhin, who is responsible for procuring loans, renegotiating debt and establishing credit for the Russian government.

The Conference of People's Deputies currently underway in Moscow will determine whether the present government will survive unscathed, emerge strengthened or fold under nationalist pressures from the Russian deputies, Mozhin said.

Mozhin said he is not optimistic about a quick solution to the Russian economic crisis.

He said he disagrees with those who have called the economic reforms proposed by Prime Minister Yegor Gaider "shock therapy."

Mozhin backed the price liberalization and variable taxation proposals of Gaider which are aimed at bring Russian domestic prices in line with the world market.

Those reforms have met strong opposition among the Russian private industrial sector, which believes the taxes will cripple the country.

"It is possible to discuss for hours whether it is better to go step by step or in a single jump," said Mozhin.

"But when you have a total economic crisis in the country, I don't think the government has any choice but to move quickl,." he added.

Mozhin also said the reforms were vital in order to continue to negotiate with the International Monetary Fund, which has enabled Russia to procure large loans from other nations.

Mozhin traced his involvement with the Gaider government to a 1988 international conference on communist economies.

That conference, which Mozhin said was the first of its kind in Europe, brought Western economists together to meet with with liberal Russians prior to the collapse of the Soviet Union.

Mozhin, who assumed the position of director this November after heading Russia's Department of International Financial Institutions, said his current job is particularly challenging because of the economic instability of the republic.

"Let me just say that in 1991, the financial situation had disintegrated," he said.

"The deficit was about 20 percent of the GNP, the people were forming queues for basic necessities like milk and bread and although prices were steady, wages were rising uncontrollable," he added.