State newspapers are more objective than private newspapers," a Russian provincial governor told me. Vologda's Nikolai Podgornov, like many other regional bosses, has long tried to block the emergence of any independent newspaper in his bailiwick. Although Moscow's liberal reformers say they want to end state control of newspapers, in some ways -- as the following three examples indicate -- that goal is actually receding .


First, in 1994, provincial executive branches virtually confiscated regional and local newspapers in a number of regions throughout the country. Previously these papers were under the loose jurisdiction of provincial legislatures, and some of them had been moving toward privatization. Now they have been transformed into mere mouthpieces for local administrations.


Second, although ultranationalist Boris Mironov was fired last month as head of the State Press Committee, that committee has nonetheless institutionalized federal subsidies to newspapers. A panel created in June meets regularly at the committee's headquarters to decide which papers will get money from Moscow; among its members are partisan politicians such as President Boris Yeltsin's press secretary. Two panelists told me that they are subject to heavy political pressure, including calls from the country's highest officials lobbying for their favorite periodicals.


Finally, just before its recent vacation, the Duma gave preliminary approval to press committee chairman Mikhail Poltoranin's proposed National Fund for the Development of the Mass Media, which has been described by liberal journalists as a "monster." This new structure would combine powers over the print media, the broadcast media and services such as printing presses. A key supporter is Federation Council speaker Vladimir Shumeiko, who said last year that the government should promote its own "state ideology" through "powerful state-owned mass media."


Of these three developments, the first is the least visible from Moscow. In the provinces, though, soaring delivery costs have slashed the provincial circulations of the Moscow dailies, making readers more dependent than ever on local newspapers. These papers often act as if they were subsidiaries of the local governments -- as many in fact are.


Consider Lyubertskaya Pravda, a typical small-town newspaper located just outside Moscow. When the Lyubertsy district executive branch seized control of the paper last winter, its maverick young editor refused to surrender. Instead he and his staff tried to turn the newspaper into a private, employee-owned company. Authorities responded by reregistering the paper as an executive organ and appointing a local official as its acting editor.


This official, Andrei Yermakov, took over shortly before Lyubertsy's local legislative elections in March -- elections in which Yermakov himself was a candidate. Under his leadership, Lyubertskaya Pravda published no real news stories about any candidate. Instead it reprinted the campaign literature of a few candidates, focusing its coverage on officials and friends of the local government such as a local military commander. One of the longest of these "articles" was for Yermakov himself.


The federal government's State Press Committee rules with a lighter hand: Its panel on subsidies, chaired by liberal favorite Sergei Gryzunov, has even awarded grants to the anti-government Pravda and Sovietskaya Rossiya. But the panel is under orders to give fully half its budget to just three periodicals -- the dailies Rossiskiye Vesti and Rossiskaya Gazeta and the magazine Rossiya. All three, of course, are controlled by the government.


Poltoranin's proposed media fund would not merely continue existing wrongs, it actually represents a step backward. An ostensibly "non-government" body, the fund would in fact be funded largely from the government budget and headed by government appointees. Taking over the role of subsidizing newspapers, and also directly owning shares in printing plants, it would immediately be even more powerful than the current press committee. Leonid Nikitinsky, who covers press-law issues for Izvestia, told me that "formal censorship would not be needed: Newspapers could just be controlled through economic leverage."


Many Russian journalists still see the free market as more threatening than promising. But in fact it is the lingering elements of the old command economy that artificially raise newspapers' expenses and lower their revenues. The three biggest expenses for the typical Russian newspaper are paper, printing and delivery. All three are still essentially state monopolies which gouge their captive customers. Newsprint from Finland is often cheaper here than paper from Russia. A few Russian weeklies have even found it cheaper to have their printing done in Finland.


On the revenue side, newspapers are squeezed by the tax code's discrimination against advertising. Advertising expenses are virtually non-deductible: Businesses must pay them almost entirely out of after-tax revenues, while investments in physical assets can be paid out of before-tax revenues. Ivan Laptev, former editor of Izvestia and head of the Association of Publishers, thinks that changing this aspect of the tax code would be one of the most helpful possible reforms.


In its current session, the Duma has a chance to enact basic structural reforms like Laptev's -- but only if it wants to create the conditions for truly independent journalism and to enable newspapers to thrive regardless of their editorial policies or political connections. If instead deputies want to keep journalists artificially dependent on outside patrons and if they want to enhance the power of politicians to play favorites through subsidies, they will follow Poltoranin.





Lawrence A. Uzzell is vice president of the Jamestown Foundation, a Washington research center that monitors post-Soviet reform, and director of its Moscow office. He contributed this comment to The Moscow Times.