This is neither the first nor the last statement on the economic policy implications of Russia's parliamentary elections. But unfortunately, no self-respecting pundit could leave such an important issue unspun. This article falls unashamedly into the bullish category: Despite the distant guns of the new State Duma, for now at least, all will be quiet on the economic policy front.


Such a position can be defended with reference to the constitution and the mechanism by which economic policy is made. Nasty legislation concocted by the new Duma can be vetoed by President Boris Yeltsin. To overturn this veto, the Duma needs a two-thirds majority. Preliminary results show the Communists and Liberal Democrats between them holding around 40 percent of the seats. In addition, although the Agrarians were nowhere near the 5 percent party list threshold, around 20 of their constituency candidates seem to have won, and will enter the Duma as independents. This brings the solid anti-government vote to around 45 percent -- high, but a long way short of the 67 percent danger level.


Moreover, a veto reversal also needs two-thirds of the Federation Council. Recent legislation -- appointing regional governors and legislature heads as members -- makes the Federation Council, for the foreseeable future, even more partial to the status quo than the Duma.


It is noteworthy that if Russia's Democratic Choice cross the 5 percent threshold, which they might, the Duma's anti-reform lobby will fall back below 40 percent. Had Yegor Gaidar's party and the centrist Women of Russia gained the extra party-list slithers they needed to form Duma factions, current views of the elections would be far rosier.


In fact, despite the gloomy headlines, the composition of the new Duma will remain unclear until the end of next month. The first two weeks after the inaugural Jan. 16 session will be a square dance of horse-trading and floor-crossing among freshly minted members. And from the 70 to 80 independents who seem to have won constituency seats, a pro-market deputy group should emerge with the voting rights of a fully fledged faction.


Fears that the Duma will attempt two votes of no confidence between now and the presidential elections June 16 should be dismissed. While most of the anti-reform lobby would like to see Prime Minister Viktor Chernomyrdin embarrassed, given the rivalry between their own presidential hopefuls, they will lack unity. Rather than casting votes of no confidence, new members will spend the next six months preparing for the presidential race. As early as April 27, candidatures for the presidential ballot must be finalized.


The point that the government -- and not the Duma -- controls economic policy is often made but often forgotten. The prime minister remains in place and is committed to low inflation. This commitment stems mostly from the fact that the interests he and his party represent also want low inflation. The confirmed chairman of Russia's Central Bank -- Sergei Dubinin -- is a Chernomyrdin ally. And the Duma could only wring credits out of him by floating a new law which they would be unable to get around the president's veto.


The tight policy stance is buttressed by the fully-passed low inflation budget for 1996. Above all, the government's extension of the ruble corridor means new credits would result in immediate and painful losses of hard currency reserves. Financial gurus seem broadly in agreement with the above. Since the elections, the currency and stock markets have held steady, and GKO yields have risen only slightly.


Anticipating accusations of incompetence by a Duma cutting its political teeth, Yeltsin and Chernomyrdin may make a few early ministerial sacrifices. Consolidating their slots in the government, faces normally friendly to the West may put on a scowl. In the name of coalition building the run-up to the presidential elections may see some cosmetic policy flexibility. But policy will not be compromised in any way which would undermine the low-inflation preferences of Russia's strongest interest groups -- oil and gas, the major private banks and export-oriented manufacturers.


The outlook for the presidential elections has not changed. Although Chernomyrdin will now pay close regard to Grigory Yavlinsky's slightly softer reformist line, he has an adequate parliamentary power base. It can therefore be surmised that the policy stance of the government will remain largely unchanged as a result of these elections. In fact, the sure-fire reason why the policy front will be quiet is that Sergei Glasyev -- the left's most effective stirrer of interventionist economic nonsense -- has lost his Duma seat altogether.