E L E C T R O S P H E R E    Issue 1.02 - June 1995

The New Russians

By Masha Gessen

The scene outside Moscow's Manhattan Express would be easily recognisable to any London clubber. The fidgeting in the crowd, the push toward the velvet ropes, the young women scrutinising the crowd from behind those ropes, the burly security guards looking on - this is a happening night spot. The crowd is aggressively self-righteous. Tatiana Lavrionova, the executive producer at Moscow's hottest movie studio, is helping with face control, and she seems overwhelmed. "These must be all tekhnari," she says dejectedly. "Movie people are never so stylish!"

This bunch is stylish. They look like they've been airlifted straight from a fashion shoot. These are the "New Russians", a breed that managed to ride the wave of changes that have shaken the country in the last five years. At a time when more than half the population lives below the poverty line and suicides have jumped 40 per cent in just two years, they are the abberation. Domestic media have coined the term "New Russians" to describe these people who have money, style, and a belief that life is good and getting better.

The phenomenon is too new to have been studied by sociologists. But all appearances and popular wisdom would say that Lavrionova is right: overwhelmingly, New Russians are techies - tekhnari in Russian - the same group that has comprised Russia's cultural elite for more than three decades. These are computer scientists and physicists, mathematicians and engineers - the people who graduated from the country's prestigious high-pressure technical schools and went on to work at universities and defence-ministry research institutes. Along the way, they have shaped the country's intellectual culture.

Quirks of the system conspired to create this improbable social class: for one thing, unlike people involved in humanities, tekhnari were generally left alone by the overseers of ideology. In addition, since more than 80 per cent of the tekhnari were employed by the defence industry, many of them spent their lives in closed towns populated entirely by their colleagues. This segregation spawned strong communities of intellectuals, who now find themselves on the leading edge of Russian cultural and economic development.

In the idealistic 1960s, they made up the nucleus of the dissident movement, which resisted the communist regime. That movement was launched by the mathematician Aleksandr Yesenin-Volpin, and was thereafter led largely by the physicist Andrei Sakharov. In the 1970s, when much of the intelligentsia sought refuge in nonpolitical activities, the tekhnari made two of them into fully-fledged fads: mountain climbing and folk singing. The first Moscow concert of Vladimir Vysotsky, the folk-singing popular hero of the 1970s, took place in the Culture Hall at the Kurchatov Institute of theoretical physics, the birthplace of the Russian A-bomb. In 1981, the same hall hosted Moscow's first rock concert.

A decade later, tekhnari lead the way in conquering the newest frontier: business. The man now reputed to be the country's richest, Sergey Mavrodi, is a computer scientist cum stock-market shark. The country's second-largest bank, Tver Inkombank, was founded by physicists. Small- and medium-size businesses seem dominated by the tekhnari. Ivan Kivalidi, president of the Russian Business Round-table, an association of entrepreneurs, confirms the impression that business is dominated by tekhnari.

"We studied to be engineers or physicists, and now some are composers and others are traders," says Nikolai Polushkin, a 33-year-old theoretical physicist, turned fashion designer. "This should not come as a surprise: tekhnari - especially Kurchatov physicists - have always been the most progressive people in Moscow, and now we are creating a new culture."

Tekhnari reinvent themselves

Polushkin's assertions are as self-serving as they sound. He graduated in 1985 from the Moscow Engineering and Physics Institute (MIFI), an elite institution with a pipeline to the Kurchatov Institute, where he worked until 1988. He started sewing in 1986 when, following the Chernobyl disaster, he realised nuclear physics would never be the cushy field it once was. It is he who has drawn the crowd to Manhattan Express tonight: he is showing his fashions, conceptual silk creations that landed the designer on the front page of Izvestiya, the country's largest daily. He says his success in fashion - his outfits go for £600 - has come naturally, because he has moved up in the world together with his peers. "Gradually, I became better," he says, "and I kept making clothes for my friends, who were becoming store owners, computer-company presidents, producers."

"All of our techie friends have gone into the music or the clothing business," claims Larisa Protasova, a 1986 MIFI graduate in computer science who, with fellow systems-engineering grad Liudmila Abramova, has been designing and manufacturing women's clothing for two-and-a-half years. "It became very difficult to survive in the high-tech field," explains Abramova. "MIFI professors now make 200,000 rubles (£38) a month... So these people, though they liked what they were doing in the sciences, turned to their hobbies, and those became businesses."

Abramova, 31, and Protasova, 30, are an odd-looking couple: the first is barely over 5 feet tall, with a copper helmet of hair; her dark-haired partner is extraordinarily tall and lanky. Never having been able to find suits for themselves, the two engineers decided to make elegant clothes "for real women, not models," as they proclaim in unison. They borrowed about £600 from Protasova's husband and bought a sewing machine and some cloth. Now seven Moscow stores and 30 regular clients buy their £60 suits and £12 blouses. After just four months Abramova and Protasova were able to quit engineering. They had 10 people working for them, but have cut down to the four best workers - all former engineers. "We've given up on professional tailors," chirps Abramova. "Tekhnari," she says, "make the best workers; they are the most responsible and the most inventive.

"Tekhnari know that if you are given information, there must be a solution. It may not be the solution you envisioned, but there is always a solution." Protasova nods enthusiastically. They are no longer talking about clothes: their theory holds for life - the ability to survive under chaotic conditions.

The transition from engineer or researcher to entrepreneur has not been as conscious for many as it was for Polushkin. For Vadim Rakhovsky, who headed a Defence Ministry technical think-tank for over two decades, his entry into the world of business was pure accident. About four years ago, he was on a flight from Moscow to New York, struggling to go to sleep while two drunk men loudly discussed lumber-shipping problems. "I could not go to sleep," barks Rakhovsky, a man who is clearly used to having his own way. "Finally, I said, 'Tell me your problem. I'll solve it, and then we'll go to sleep.' They explained that it had become unprofitable to dry timber since fuel prices went up."

"The solution was plain to see. They were using great amounts of fuel to dry the wood because of the huge difference between the temperature inside and outside the drier. All they had to do was pump out the air, creating a vacuum, and causing the temperature at which water boils to fall to 41° C." So, using a rule most Russians learn in high-school physics - that evaporation occurs faster in a vacuum - the scientist solved the problem and, incidentally, transformed the think-tank into Antekh, an R&D firm that develops not only vacuum lumber-drying chambers, but vacuum switches, marble furniture veneers and unbreakable high-class china.

Mark Nemoyter, 45, also fell into his business. Once a software engineer, he now heads a company called SBS, and takes in £3 million to £4 million annually. His main lines of business are importing raw materials for the tobacco and food industries and designing and constructing small hydroelectric plants. Nemoyter reckons importing to be the most promising line of business in today's Russia, as it offers the highest profit margin.

Sitting in his office - a grey-carpeted, Western-style oasis in the centre of Moscow - the plump, rosy-cheeked Nemoyter looks like a Type A personality in heaven. "My work is so interesting," he brags. "Every day I have to solve at least five major problems or 10 lesser ones. Take, for example, what I went through when we got our first shipment of coconut oil from Singapore. We needed safety certificates. First it took the agency a week to get to us while I had to pay £125 per container per day for storage. They found the radioactivity was 10 times the legal maximum. Ten days later, after we appealed, they admitted they'd made a mistake but said the lead content was too high. Finally, they made it clear: certificates cost £600 per container - no testing required - or no certificate, regardless of what we have in there." All it took was a bribe. "No Western businessman has dreamed of the kinds of problems we encounter every day."

Bribes to minor apparatchiks are the least of it. These techie-entrepreneurs, like other business people, are reluctant to discuss their relationship to organised crime, but all acknowledge that it is an ever-present part of doing business in Russia. For some, it cramps their style: Nemoyter drives a beaten-up Soviet-made Fiat, keeps his summer house unpainted, and spends his nights at home to avoid unwanted attention from the Mob.

Rather than grow dejected, these new Russians seem to relish their problems: they see themselves as warriors. "The relationship between the government and the entrepreneurs is best compared to gang rape, except the group being raped is far larger than the group doing the raping," says Kivalidi. And where the state lets up, organised crime turns on the pressure. "But as a result, the Russian entrepreneur compares favourably to his Western counterpart: he is always alert and in good shape, like a marathon runner."

Confidence is its own reward

Such is the trade-off: these tekhnari have given up their old social status - that of a pampered, protected cultural elite - in exchange for the role of trailblazer. They see themselves as heroes. "In a normal society," says Protasova, "tekhnari will work with computers and whatever else they were trained to do, but we do not live in a normal society, so this is what we have to do." There is a note of nostalgia: the tekhnari miss their old work, but the payoff is worth the sacrifice.

"I look at people who stayed in software," says Nemoyter, "and they are making decisions about whether they can buy sausage or good cheese this week. Meanwhile, I make decisions that affect the lives of the 35 people who work for me, that affect the fate of my business. All my life I was told I was a cog in the wheel. Only in the last five years have I realised this was not so."

Probably the biggest benefit of being a businessman in today's Russia is confidence. This is a small group that feels it has gained - not lost - power. They seem to feel they can do anything. "I made a realisation a year ago," claims Polushkin, "that the real power is not with the politicians or the masses, but with us, the young entrepreneurs."

The militant Kivalidi, from an older generation, drops the "young", but his sentiment is the same: "Entrepreneurs will come to rule the country," he says. "It is inevitable."

Masha Gessen (mgessen@glas.apc.org) writes on politics and the economy for Novoye Vriemia, Russia's weekly political magazine.