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                                                                                COVER STORIES, Page 62

THE NEW RUSSIA: FINANCES


The unfulfilled promise of reform means that working-class families
are just scraping by

By ANN M. SIMMONS/VORONEZH


    The saddest truism in Russia is that life is harder now.
Not that ordinary citizens ever lived very well, but most could
afford the basics. Today soaring prices and an almost totally
worthless currency have reduced even that way of life to a bare
minimum. Look at what the unfulfilled promise of reform has
brought the Vaktin family.

    The alarm clock rings at 5:30 a.m. Nadezhda Vaktin, a
41-year-old hairdresser, heads straight for the kitchen of her
family's four-room apartment in a ramshackle high-rise in the
industrial city of Voronezh, 340 miles southwest of Moscow.
Before the water supply goes off at 9 -- for the next 10 hours
-- Nadezhda must prepare breakfast, lunch and dinner for the
family of four, wash dishes and clothes and fill four buckets
for drinking. Husband Alexander rushes to clean up before
daughter Larisa and son Alexei commandeer the bathroom.

    As the teakettle bubbles on the old tin stove, Nadezhda
serves a breakfast of bread and butter while considering her
shopping list. "You can't plan now," she says. "Things were more
affordable before." Food costs the family nearly 4,000 rubles
a month, a sizable proportion of their combined monthly income
of 7,500 rubles. Money must also be set aside for rent -- 70
rubles now but set to rise soon -- and for transportation, which
runs about 80 rubles. Not a kopeck is left by month's end for
saving. Education and health care are still supplied free by the
state.

    The Vaktins are no worse -- and no better -- off than most
working-class families these days. The promise of Western-style
capitalism has brought them little more than rising prices and
a shriveling ruble. Hard-to-get products might be more
plentiful, but average citizens cannot afford them. The falling
ruble has reduced paychecks to a pittance. With no hard-currency
income to fall back on, families like the Vaktins scramble for
the bare necessities.

    Learning to live with the changes has not been easy. "I
simply don't understand what is going on now, and I'm not
alone," says Alexander, 42, a truck driver for a collective farm
30 miles away, who earns between 3,000 and 4,000 rubles a month.
"When prices were fixed, bread cost this much, milk that much.
Now in one shop there is one price, in another shop a different
price."

    Nadezhda earns 3,000 rubles styling men's hair 39 hours a
week in a no-frills state shop that serves as one of the
neighborhood's social centers. Larisa, 19, also a hairdresser,
was unemployed for eight months but now brings home 1,500 rubles
from her job; Alexei is in high school.

    Nadezhda holds the family purse strings. She spends three
to five hours a day scouring the local shops and farmers'
market for the best bargains. "In the past, 10 rubles could have
bought me 6 lbs. of meat," she says. "Now I can't even buy 2
lbs. for 100 rubles." Her monthly shopping list is short: 6.5
lbs. of meat at 125 rubles per lb.; 13 lbs. of sausage at 100
rubles per lb.; 22 lbs. of potatoes at 7 rubles per lb.; 90 eggs
costing about 38 rubles for 10; and 3 lbs. of butter totaling
300 rubles. Sugar costs 40 rubles per lb. and requires a ration
card allowing the purchase of 4 lbs. a month. The seasonal
fruits and vegetables that supplement this diet come from the
Vaktins' own country garden. Some cash is usually put aside for
a few bottles of vodka.

    Clothes are a luxury. Nadezhda shares her only raincoat
with Larisa. Alexander and Alexei, 16, have learned to go
without anything new. The Vaktins have no telephone, so contact
with friends is limited. The wooden cabinet and rickety set of
armchairs in the living room, which also doubles as master
bedroom, were bought 17 years ago. There will be no money to
replace the furniture anytime soon. The family's only
entertainment is an old Russian-manufactured TV on which
Alexander watches the latest sports and Nadezhda her favorite
soap opera.

    Since the Vaktins have no car, rising fuel prices do not
directly affect them. But the cost of train and plane tickets
has curbed any vacation plans; a single train ticket from
Voronezh to Moscow has jumped from 10 rubles to 230. Holidays
are strictly limited to the family's dacha 16 miles away, which
they reach by a special bus costing 14 rubles.

    The Vaktins spent their lifetime savings to build the
two-story country house four years ago. Alexander's sister
supplied construction materials cheaply, since she worked in the
trade. His mother helped pay for the bricks. The dacha cost
about 10,000 rubles, a sum that could have bought two cars at
the time. But the property is debt free, and the Vaktins relax
there every Sunday.

    Though life is more difficult than ever, the Vaktins still
trust that the future will bring better times. For now, their
children have enough to eat, their flat is cozy, and they have
Elsa, an Alsatian, to keep the family smiling with her playful
tricks and antics. "We can't complain," says Nadezhda. "But we
hope things will get better." That is still mostly just a dream.