JANUARY 2, 1996
A popular television show in Russia tries to muster interest in Capitalism by showing middle class life in the U.S. Economics correspondent, Paul Solman of WGBH-Boston, reports.
MR. SOLMAN: Judging by the recent vote in which the Communists got by far the largest share, the Russian electorate would rather be red than reformed, that is, economic reform was widely repudiated at the polls. These days, however, the best hope for a free market economy in Russia might lie with people far from politics, people like Michael Taratuta. This is the opening sequence of one of the most popular TV shows in Russia, "America with Michael Taratuta." Twice a month, host and producer Michael Taratuta's half-hour TV magazine acquaints some 30 million Russians with such hallmarks of American life as Halloween and McDonald's. (Russian in background) Regularly, Taratuta explains the American way of business to viewers who'd been taught the evils of capitalism for 70 years.
MICHAEL TARATUTA, Russian Journalist: I know that all my stories which deal with the workings of capitalism, market economy, are very welcomed. They are very popular. An example: I did a story why airports in this country are money makers, and why airports in Russia have always been money spenders. This tape became educational material to ticket officers at the Russian airports, just as an example.
MR. SOLMAN: At one level, the ambition of these segments is modest, to simply show how business works, but at another level, Taratuta is actually trying to salvage capitalism at what may prove, given the recent elections, a critical moment in Russian history. Fearing possible consequences of a return to the past, Cold War with the West, civil war at home, Taratuta, among others, has turned to TV to influence the attitudes of everyday Russians by teaching them how to cope with free markets before it's too late. To do this, Taratuta uses a down-home approach. To illustrate how a small business scrapes by, for example, he featured his own, explaining how he produces the show from a temporary base in San Francisco, his daughter, Katya, helps him with reporting and translation, his wife, Marina, helps with the Russian voice- overs, his Russian cameraman, Vladimir, doubles as his graphics department, all part of an effort to make economics accessible to the everyday viewer of Russian TV, which makes perfect sense, says Taratuta, since it was TV that helped soften Russian attitudes toward the West and market economics in the first place.
ANNOUNCER: It's 8 at night in America and 7 in the morning in the Soviet Union.
MR. SOLMAN: In a sense, it all began with these so-called space bridges in the early 1980's in which Americans and Russians hooked up by satellite for joint TV events that played to mass audiences in both countries.
("WHERE HAVE ALL THE FLOWERS GONE" BEING SUNG IN RUSSIAN)
MR. SOLMAN: The emcee on the Russian side, Vladimir Posner, introduced American treasures like John Denver to the Russians.
VLADIMIR POSNER: John, you didn't think we'd let you get away without singing a song, did you? Come on, where's the guitar? (applause)
MR. SOLMAN: As TV continued to open up, images of Western products and wealth flooded in (McDonald's Commercial in Russian), and Russians bought what they saw, both figuratively and literally.
MICHAEL TARATUTA: Russians were used to that what is said to them officially--officially means through television and the print--it is checked many times and it affects when it comes to real things, not--propaganda, political propaganda, that's true, and when they saw commercials on television, then they saw some stories on television, they just believed it.
MR. SOLMAN: Western ads promised paradise, that your dreams would all come true. As a result, the Russian image of capitalism went through a dramatic about-face. The likes of Santa Claus now represented the free market, doling out goodies while contentedly swigging Coca- Cola. Of course, images like these didn't describe real capitalism anymore than the Communists had, but viewers didn't know that. They were infatuated with the glitz of America and its marketplace. Unfortunately, the selling of capitalism on TV soon got out of hand. Russians were sitting ducks for scam artists and swindlers blanketing the airwaves with happy-go-lucky ads like this one. To beat the system, the ad said, all you had to do was invest your life savings in stock, just like Americans do, and here was a great stock to buy, a company called MMM. What exactly was MMM? The ads never said. Instead, they promised fantastic profits, a monthly return of one and a half times your money, and, promised the ads, early investors wouldn't believe their eyes.
MICHAEL TARATUTA: You first got great return. Another group got return again, and that continued for a while, maybe a year or two years. And that was glamorized on television in their commercials. They were saying, we did money for ourselves and we can do money for you, and that worked.
MR. SOLMAN: The point is behind the glamor of ads like these was the oldest financial scam in the books--the chain letter or ponzi scheme that promises riches but runs out of money as soon as it runs out of suckers. Taratuta did a piece about MMM, trying to sober up his audience about the free market, and to put the ads in context, he used noted American economist Hyman Minsky.
HYMAN MINSKY, Bard College: They were saying, I know how to make money, give me your money, and I'll make money for you. When you hear that, run.
MR. SOLMAN: As it turns out, MMM is only one of many such scams that have capitalized on post Communist naivete in Russia.
MICHAEL TARATUTA: So many people lost their money--just a great number--my mother lost money.
MR. SOLMAN: Didn't you tell your mother, Mom, this is a lousy idea?
MICHAEL TARATUTA: My brother is a banker. He told my mother, never do this, but she didn't want to listen to him. She'll listen to the majority of her friends.
MR. SOLMAN: Taratuta's program is not the only attempt to hike Russia's financial IQ. There are now "how to" shows like this goofy explanation of what stock's all about. (Russian TV Show Segment in Russian) The show next demonstrates that you can't use stock certificates as currency. There was even a documentary on MMM and other such schemes showing how so many Russians lost their life savings when these frauds inevitably collapsed. Meanwhile, the victims have been reduced to fighting amongst themselves as they line up in hopes of recovering some tiny fraction of their money. No wonder Russians have become so cynical about the West and its fabled free market. Arguably then, this is where Russia's at at the moment--the centrifugal force of capitalism, people pursuing their own self-interest--has been unleashed, but the laws in infrastructure needed to control that force aren't yet in place. More than a century ago, sociologist Emil Durkheim wrote that if societies didn't adopt strong laws and institutions before opening up their markets to capitalism, the free market free-for-all might actually tear those societies apart. Today, economist Andrei Shleifer, an adviser to the Russian government, thinks the problem Durkheim identified is alive and well, all too well.
ANDREW SHLEIFER, Harvard University: The problem in Russia is that the kinds of things that, as you said, bind the society together, the kind of function that the government needs to perform to let the market economy function in terms of a safety net, in terms of law and order and so on, are not provided, and until they are provided, you're going to have a very difficult time.
MR. SOLMAN: Meanwhile, Taratuta says his father exemplifies the mood that expressed itself in the recent Russian elections.
MICHAEL TARATUTA: He says that what is happening now in Russia is so inhuman, that it's so difficult for so many people to live, and he associates that with capitalism, and I'm afraid that he's not alone in this kind of thinking.
MR. SOLMAN: With all this, big surprise that the Russian electorate is disenchanted with economic reform, and that reform's champions, like Prime Minister Viktor Chernomyrdin, received such a chilly reception at the polls.