210 



of reform argue that, "Well, see, these guys aren't producing mar- 

 ket amoiuits of stuff; therefore, this reform has failed." 



In fact, probably about 5 percent of grain last year was produced 

 by individual farmers. Nobody's quite sure. There are several inter- 

 esting things about the taxes that caused farmers, perhaps even 

 more than American farmers, to underreport their production. The 

 numbers are not good, but that's the best guess. 



Mr. Penny. Mr. Allard. 



Mr. Allard. Thank you, Mr. Chairman. 



I'm looking at the second release here that's quoting — yesterday 

 there was a release, and then today there was a release that was 

 quoting officials from the Clinton administration on what they 

 were thinking about for aid for the Soviet Union, and I notice, Mr. 

 Chairman, that at least in today's release they're beginning to talk 

 a little bit about modernizing farms and talking about a transpor- 

 tation and distribution system that gets products from the farm to 

 the cities, which is some of the discussion we had today. 



But one of the things that showed up in both of the releases was 

 they were going to target some of that money on building housing 

 for Russian soldiers, and I'm trying to figure out why that need 

 would be there. Can either one of you shed some light on why that 

 might need to be there? 



Mr. Van Atta. Well, there are two answers to that. First, you 

 must understand that the Russian housing stock has suffered be- 

 cause they have undergone urbanization of the sort we underwent 

 between about 1850 and the present in about 50 years. So there's 

 enormous pressure on the cities, and their system of distribution, 

 which gives favor to the cities in everythmg, increases that tend- 

 ency for everyone possible to move out of the countryside to the 

 city. 



A second reason, of course, is World War II, which destroyed 

 much of their housing stock. A third reason is they simply build 

 very slowly and very inefficiently, which has resulted from the sys- 

 tem of allocating investment, in which the trick is, excuse me, ]ike 

 an appropriations bill — if you can get the money to begin a project 

 this year, then next year you can say, "Well, see, I have the foun- 

 dation, so give me some more." So you wind up with Russian cities 

 that are surrounded by building sites, but those building sites had 

 been building for the last 15 or. 20 years. 



The reason why the army is particularly important is because 

 the Russian army has no lifetime noncommissioned officers. All the 

 functions that are done by NCO's in the American Army are done 

 by military officers in the Russian army. It's a conscript army of 

 2-year terms for everyone, and then a huge officer corps. That offi- 

 cer corps has gotten enormous privilege over the years as the de- 

 fenders of the homeland, and they all joined because they all as- 

 sumed that aft;er years of serving in Magadan or somewhere else 

 unpleasant, they would eventually all become colonels or generals, 

 they would get privileges, and they would get to live in the center. 

 Bringing Russian troops home to an overcrowded city when these 

 guys expect to live in good conditions, therefore, creates more pres- 

 sure on the housing stock and creates a very disgruntled officer 

 corps. 



