Val Karren: The Deceit of Riches

“Exactly!” he hollered and nearly jumped out of his chair at me.

After a signal from his wife, Els, who was busy cooking in the kitchen, Del looked at me with a serious face and said, “Soup’s on!”

Del Sanning was a true blue, dyed in the wool American from the heart of the prairie land. He looked it, he talked it and his wife sure cooked it. After ten days of watery Russian cabbage or over salted beet soup and meat dumplings of questionable origins, and too much garlic, a home cooked cowboy stew was a true comfort. Els Sanning was a studious and intelligent woman who didn’t show her hand quickly. She was hospitable and generous and full of questions of a different sort. She knew how to ask questions that opened a discussion up quickly to the heart of the matter.

“So, why did you choose to study in Nizhniy? Why not Moscow or St. Petersburg? It would seem that you would have more resources and a bit more comfort than out here in the boondocks,” Els asked.

“Well, I wanted to go where the others had yet to see. Told Del just now that I spent last summer working on the river and saw so much of the country and realized that there was much more to Russia than Moscow,” I said thoughtfully.

“What’s your major then? Or are you just here for language training?” was her follow-up.

“Well, funny you should ask, I just came from the research library and I think I’m going to write my thesis about the privatization of state companies to find the secret to success and figure out why one succeeds and another doesn’t,” I replied resolutely.

“Sounds very academic,” Del said and glanced over at Els.

“…and very ambitious,” Els said gravely, setting down her fork and folding her hands above her steaming bowl.

“Well, we’ll see where it takes me…,” I brushed off their obvious cautiousness and concern for my academic project and took another chunk of beef with a potato.

“Peter, Del and I have been in Russia now about four years now,” Els was trying to be tactful but was dead serious, “the people who you will need to research for these topics don’t like to be asked too many questions. What you might think is a transparent, orderly process is nothing but a free-for-all. Businessmen and journalists are being murdered on a weekly or monthly basis. Rules don’t apply here. Be very, very careful about the type of questions you ask. You might live to regret a number of them if you are not very tactful and very careful. It’s not what you read in the American press. Take some time and observe….”

Del interrupted, “You’ll need connections! The business people here are not typical managers or CEOs. They usually have something to hide and don’t trust people with their life stories. Doing any due diligence is like pulling teeth. They give you the official books and you play along for a few days and then you have to ask for the shadow bookkeeping before you know the true health of a modern Russian enterprise. They play the shell game with assets and cash better than anybody I’ve ever played with. The truth is a slippery pig, my young friend.” It seemed both Del and Els were trying to dissuade me from taking up this line of research.

“Yes, I’ve heard about the shadow accountants,” I commented as I chewed a chunk of beef.

“Really, from who?” Del reacted surprised.

“A bookshop keeper in St. Petersburg. Selling books, paintings, postcards, Kodak film.” I didn’t think anything of it.

“Really, he just told you about it?” Del seemed put out. I couldn’t understand why.

“No, we asked him. I was translating for one of my tourists who was an accountant. He asked him straight up about how he can make a profit in the mess of communist and capitalist rules. The fellow knew what he was talking about. The owner of the place just opened up and told us about his shadow books. Look I’m not making this stuff up! I was just translating,” I said defensively.

“Kid, everybody here has a shadow life or a shadow operation and they keep it very close, sometimes they don’t even tell their spouses what they’re up to, and this shopkeeper in Petersburg just tells you this in the middle of his shop, right as he’s ringing up the till, like he’s talking about the weather?”

Els chimed in, “Well Del, maybe you should take him to your next meeting with your contractors. Maybe he has a trustworthy face…,” Els smiled a play pity smile to tease her husband.

“I’m pretty sure that even the University has a shadow administration. I saw it in action earlier this week. I understand that my tuition, paid in cash, won’t make it on the University’s balance sheet,” I said between bites. On saying this I knew I probably shouldn’t have and moved quickly to change the topic. “So, what brings the two of you to Nizhniy?” I asked trying to mask the embarrassment caused by my big mouth.

“Del is the project manager for the planning of a new hotel here in the old town,” Els answered for him.

“A decent hotel I hope because the one down the street near Minin Square looks like it is filled with roaches and the other types of bugs — the ones with microphones. It reminded me of the Intourist on Red Square,” I chuckled as I remembered the horrid, dirty hotel in Moscow.

“You stayed in the Intourist? You are a brave lad aren’t you?” Del chuckled with me.

“When I was there it was all thugs and hookers. Nothing too dangerous.” I remarked.

“Haaah! The thugs AND the hookers were all probably KGB. That’s what they do these days,” Del pointed out.

“So what hotel is it going to be? Something American or are you working for a European group?” I asked truly interested.

“Well, we don’t know what the marquis will say yet. We’re more the ground workers who get the permissions, the land, and set up organizations to build for the most interested hotel chain. We have our hopeful buyers of course, but right now we’re just putting in the ground work,” Del explained in a serious voice, “It will be a good one though, at least four stars with a state of the art business centre where a guy can make a call, check emails and send faxes without having somebody read his notes over his shoulder. A place with some privacy. We succeeded in Moscow a few years back and so now they sent me here because Nizhniy has become interesting for foreign investors, and they’ll all need some place to sleep while they’re here.”

“Well, I did find this today at the roach hotel,” I pulled the new copy of The Economist out of my school bag and showed it with pride.

Del looked delighted at my revelation. “Can you get us one too?”

“I paid the concierge twenty dollars to reserve me one each week, on top of the cover price of course. I can pick it up each Friday afternoon,” I said gloating a bit.

“Do you think he’ll set two of those aside?” Del reached for his wallet and handed me another Andrew Jackson.

“And when you deliver it you can come for dinner and keep us up to date with your research,” Els kindly invited.

It took me another week to convince Valentina Petrovna to allow me to move out of the student accommodations and into a privately rented room. During the back and forth with her I was suspicious that somebody behind the scenes didn’t want to let go of my monthly fee paid in dollars for room and board. In the end, the local police department settled the argument and confirmed it was legal for me to live wherever I wished.

Yulia placed an advertisement in a local newspaper where she was interning and within a few days had a telephone call from a landlord offering a room in a communal apartment on the other side of the Oka river in the Lenninskiy district. Yulia joined me and Hans for our fried chicken Friday ritual in the old city. She had just come from viewing the apartment which was not far from her own.