April 24, 2000

Page One Feature

Why the Russian Police Tried
To Take Public Its Private Baths

By ANDREW HIGGINS
Staff Reporter of THE WALL STREET JOURNAL

PAVLOVO, Russia -- Police pounced early in the morning, armed with guns, a saw and orders from the Committee for Emergency Situations, a municipal crisis unit responsible for order in time of war, natural disaster and other calamitous events.

"We were warned that there could be an outbreak of civil unrest," says Georgy Chinyonkov, deputy mayor of this grubby central Russian town. "We had to act." Fearing for the welfare of Pavlovo's 75,000 residents, the local government declared a state of emergency and mobilized security, health and civil-defense officials for a swift strike.

Their target: Bathhouse and Laundry Complex No. 4.

Police moved in to secure the saunas. Their adversary, defiant bathhouse baron Sergei Vanin, was waiting -- along with a camera crew from a local television station. "It's like 1917 all over again," thundered Mr. Vanin, "This is how all revolutions start."

Not quite. But he had made his point. Unnerved by the TV camera, the police retreated.

French revolutionaries stormed the Bastille. Lenin's Bolsheviks seized the Winter Palace. Here on the banks of the River Oka, 220 miles east of Moscow, the citadel that really gets the blood boiling is a malodorous concrete bunker equipped with two steam rooms, four broken washing machines and a pile of birch twigs ready for use as welt-raising whips. (The town's other passions are ice fishing and scavenging at a municipal dump.)

Stripped bare, the issue is this: Can the cold hand of free-market economics keep people clean? The local government says no. Accusing Mr. Vanin of overpricing and underinvesting, it has tried to nationalize his bathhouse. Mr. Vanin sees a naked grab for power and property.

The dispute has left a lot of people steamed. Mr. Chinyonkov, who heads the administration's property committee, is so stressed, he recently checked into a hospital with heart trouble. Mr. Vanin, who also has a stake in a gas station, says he fears for the safety of his family and wants to emigrate. "This fight will never end," he says. "I deserve a mention in the Guinness Book of Records."

A few days after the first abortive attempt to grab the bathhouse, police returned to complete their mission. With the TV crew gone, they sawed off a big lock on the door, banished Mr. Vanin and installed in his office a bureaucrat from the local housing department. "Red Flag at the Bathhouse," proclaimed a banner newspaper headline.

The soap opera has since come to involve much mudslinging, a bitter court battle, a hunger strike in the changing room, overheated letters to the press and an appeal to Vladimir Putin, Russia's newly elected president, to lower the temperature.

Why such a froth?

"A bathhouse is not just a place to get washed," says Alexander Vereshchan, leader of the local Communist Party, "It is a place of celebration and ceremony." Every resident, he says, has a "basic human right" to stew in infernal heat, flail the flesh with bunches of twigs and plunge into tubs of freezing water.

Such rituals have been a feature of Russian life for centuries. In the early 19th century, a visiting French nobleman, Astolphe de Custine, noted that "so many individuals resort to these establishments, where the warm humidity is so favorable to insect life ... that the visitor rarely departs without carrying with him some irrefragable proof of the sordid negligence of the lower orders."

After the 1917 revolution, the communists launched a bathhouse-building blitz, embracing singeing heat as an agent of hygiene and revolutionary ardor. When a competition was held in 1920 for the design of a model bathhouse, Leo Trotsky and several other Bolshevik leaders submitted grandiose entries.

The tradition transcends ideology. Boris Yeltsin is a devotee of banyas and, according to his former bodyguard, did much of his decision-making in a Kremlin bathhouse. Mr. Putin is a more buttoned-down sort but spent election day last month in a rural bathhouse.

As with many Russian passions, humdrum concerns about profit and loss have tended to wilt in the steam. In the Soviet era, that made little difference: The state footed the bill. Bathhouse and Laundry Complex No. 4 was owned and run by Pavlovo's municipal government. It kept prices low and did a communist youth camp's laundry free of charge.

The free market introduced the frigid grip of economic reality and exposed the rot afflicting one of Russia's most cherished institutions. Across the country, the state sold off its assets -- oil wells, aluminum smelters, nickel mines and, in Pavlovo, four public bathhouses.

Mr. Vanin, the head of a small company called Giant, bought one of them, calculating that necessity -- many of the town's homes have no hot water -- and habit would fuel a booming business. Before long, he had a monopoly as rival bathhouses closed: One became a casino, another a drug dispensary. A third crumbled into a derelict ruin inhabited by drunken tramps.

But instead of making his fortune, Mr. Vanin lost his shirt.

Lyubov Shovina, editor of the Pavlovo Metallist, the local newspaper, blames "market romanticism." Privatized public hygiene, she says, will never produce a healthy bottom line. "He's a romantic. He should have given up long ago," she says.

At first, though, Mr. Vanin did turn a modest profit. Fuel was cheap, and the local government paid the entrance fees for needy residents. It also gave him tax breaks and intervened when the price of fuel oil skyrocketed: Officials ordered the bakery next door to supply steam. In return, Mr. Vanin pledged to keep the price of admission at just six rubles, then worth less than a dollar, and bathe pensioners free of charge.

After Russia's financial markets blew a gasket in August 1998, though, the heat was on. The bakery demanded payment for its steam. The local government, scrambling for cash, suspended bathing subsidies. Mr. Vanin sought to boost revenue by opening a bar. Bureaucrats accused him of illegal vodka trading and shut it down. Mr. Vanin raised the price of admission. Residents started howling.

"This town needs a bathhouse like it needs oxygen," says Vladimir Plakhsin, general director of the steam-supplying bread factory, "But air is free and steam costs money ... . It's a vicious circle."

Last spring, the local administration increased the pressure. A swarm of inspectors descended on Mr. Vanin's bathhouse. The health department declared it unsanitary. The fire department ruled its wiring unsafe. The tax people pored over its accounts. Mr. Vanin, his money and patience exhausted, retaliated by turning off the heat.

Authorities flew into a panic. The Committee for Emergency Situations called an urgent meeting and issued a decree placing Mr. Vanin's property under government control. "People had to wash somewhere; our grannies, our poor people had to keep clean," says Mr. Chinyonkov, the deputy mayor. "Private property is protected by the law ... but this is a special situation: We had to open the bathhouse." He says the town risked an epidemic of scabies and civil disorder.

When Mr. Vanin won a court judgment declaring the expropriation illegal, authorities appealed. In protest, Mr. Vanin, his wife and their eight-year-old son staged a hunger strike. They suspended their fast after the court upheld Mr. Vanin's ownership. Authorities then accused him of abusing his monopoly and hauled him before a competition watchdog board to answer complaints of price gouging. He again prevailed.

But it was a hollow triumph. He won by proving that he was losing money. Soon afterward, the bathhouse's pipes burst and flooded the changing room with icy water. (Mr. Vanin suspects sabotage.) Unable to pay for repairs, he offered to sell his bathhouse back to the government for $178,000. Authorities scoff at the price and, now that winter -- the main bath-going season -- is over, they want Mr. Vanin to stew in his debts. "Business is about taking risks," gloats Mr. Chinyonkov. "Maybe we'll open another banya."

At his home overlooking a cemetery, Mr. Vanin fumes while his wife watches a Mexican soap opera on TV. "I'm fighting a whole system," he says. "They could never let me win." He has put up a U.S. flag in his living room as a protest. In a wooden shed in the back garden, he is building a sauna.

Write to Andrew Higgins at andrew.higgins@wsj.com¹

For information about subscribing, go to http://wsj.com