It's December 4, 1993, and I'm standing on the pedestal of the giant statue of Lenin outside the Lushniki Sportkomplex, one site of the abortive Moscow Olympics of 1980. Around me is a milling, frenetic crowd of 125,000 people. The Olympics are long gone, and the grounds of the stadium have become a monster capitalist flea market.

Moscow's current apparatchiks are planning to bury the mummy of Lenin in his hometown beside his mother, but they're missing a good bet. They could attach rotors to Lenin's head and feet, and he'd generate a Chernobyl's- worth of power for the new Russia as he spins there in his grave.

This is a raw, street-level garage sale for a city of ten million people. The Sportkomplex is a pickpocket's paradise, and if there's any order in the acres-wide chaos of buyers and sellers, it's not being enforced by head-shaking Moscow police.

People say that queues in Russia are now a thing of the past. But the queues aren't really gone at all; they've just mutated. Those famous long lines of Russian shoppers still wend through the Lushniki, but move at high speed, and with little control. The mob of street vendors, doing deals from fold-up card tables and cheap, portable luggage trolleys, are awash in high-speed torrents of shoppers, endless writhing lines of shuffling, staggering Russians. The queues are moving briskly past the goods, just a hair away from mob stampede.

The Moscow city cops stay well outside the tall iron gates of the stadium compound, backed up by their scary colleagues from OMON, the capital's elite anti-insurgency troops. The OMON troopers travel in camou-clad squads with submachine guns slung over their backs, but they don't enter the compound either. There are no fire safety codes at the Lushniki Sportkomplex. There is no provision made for a safe evacuation. Worse yet, there are a lot of open fires around, where Azerbaijanis muffled to the eyeballs are roasting skewers of lamb shashlik.

The weather is well below freezing. The direly overtaxed public urinals of the Sportkomplex are leaking wrist-thick stalactites of frozen sewage.

In Moscow, they always sand the streets after a snow; but today they're not using sand, they're using giant truckfuls of powdery gray dirt. The result is a sticky, ochre-gray half-frozen muck that clings to boots and migrates wherever human feet travel. The filth is all over the Sportkomplex, spattering people's trouser cuffs and coat hems, dripping off the wheels of the groaning hand trolleys.

The bigger dealers are inside the stadium building, in the cavernous area under the stadium seats, where the arctic wind is cut and it's warmer. Here the crowd of shoppers is thicker, the goods more choice. There are glossy leather jackets on makeshift metal racks two stories high; there are patterned nylons and bright-red lingerie and glossy wall posters of bikini- clad starlets and leering heavy-metal bands. There are toilet seats, wristwatches, nightgowns, fiber-tipped pens, plastic packs of coat hangers. Women in white mink sample perfumes with grim determination, clinging to their places at the table while repeatedly jostled and elbowed by hundreds of passersby. Hustlers thumb rifle-thick, multicolored wads of hyperinflated Yeltsin rubles, standing their ground behind tables piled with dress shirts, lipsticks, and switchblades.

I search hard as I stumble past in the thick of the crush, but I don't see a single item for sale in Lushniki that is actually made in Russia.

Out behind the stadium, far from the madding crowd, there are Woodstock- size trash heaps of packaging from Italy, Finland, Spain, Germany. Weary merchandisers warm frozen hands over blazing trash barrels crammed with Western crates and cartons.

It's a consumer orgy of Western mall junk - the triumph of the Invaders from Mars Bars.

Outside the Sportkomplex, the frenzy doesn't stop; it just mutates again. There are kiosks everywhere now, Yeltsin's concession to the unstoppable explosion of street dealing. The kiosks officially started in 1991, and now they are all over Moscow, in fungal profusion, like bread mold. Prefabricated plastic stores about the size and shape of Yankee garden sheds, the kiosks perch on the pavement of Moscow hawking Coca-Cola and Hershey bars and Marlboros, as if trying to jump-start the moribund Russian economy with massive doses of nicotine, caffeine, and white sugar. Kiosk hustlers also sell magazines and perfumes and condoms and innumerable imported liquors, and pirated pop music and videos and Sony Walkmans and blank tapes and religious icons.

The icons are the genuinely strange part. Icon kiosks have shiny little onion domes topped by the gilded Orthodox cross. They sell holy relics. They do brisk business. The Church is back. Everything from before 1917 is back: Czarist cookbooks, the double-headed Romanov eagle, even The Protocols of the Elders of Zion - a Czarist secret police forgery, now a hot seller among Mother Russia's flourishing antisemites. Yeltsin's major contribution to the architecture of Red Square has been to rebuild an Orthodox church that Stalin bulldozed; the church has been restored with a fanatic attention to detail, and it sits next to the GUM store with the look of a giant candy-colored Christmas toy just broken out of the shrink wrap.

The dead walk again in Russia; the pale Christ has emerged from His tomb and made His peace with the capitalist money lenders.

Bill Gates, the Napoleon of software, has sent a brave squad of fifteen to invade Russia.

The furniture and settings of the Microsoft offices on Leningradsky Prospekt look like any off-the-shelf branch office in any business park in America. It takes time to recognize the true scale of Microsoft's victory over the local entropy. Study Moscow for a couple of weeks and then return to Microsoft HQ: You'll find yourself living a minor miracle. The ceiling lights are bright yet soothing, and every single one of them works! It's quiet inside, with genuine acoustic tiling unmarked by scars, cracks, or long brown stains from a leaking roof! The desks are ergonomic, and none of them wobble! The chairs are clean and don't squeak, and there are none of Moscow's omnipresent giant rusty padlocks in sight - just a small, discreet, card-swipe security box neatly mounted in the office doorframe.

The carpet is filthy from the booted tread of Moscow's ochre-gray paste, but no office anywhere is an island. Gates's inventive and determined Microsoft Russia staffers will get themselves a steam vacuum soon, if there's such a thing to be found in Moscow; failing that, they'll medevac one in from Helsinki.

From November 29 to December 2, the Microsoft Windows Expo took place in Pavilion Four in the Exhibition of Economic Achievements complex, in north Moscow, off the Mira Prospekt. For decades, this locale was an obligatory tourist spot, a hypertrophied Potemkin village where the regime tried to convince the West that Communism would bury it in streamlined scientific- socialist mass production.

Into this anachronism, Microsoft Russia and Expo co-sponsor PC Magazine Russian Edition have introduced their carnival of computers to an audience that must include some of the magazine's enthusiastic readers. (Wider in scope than its American associate, PC Magazine Russian Edition publishes 73,000 copies an issue; most of those are read by at least a dozen people each, in Russia's intense, hand-to-hand, informal networks.)

The Expo has turned the Gagarin room in the famous Cosmos Hall into a techno dance club. Today the CCCP is every bit as dead as the Pharoah Akhenaton. Its next of kin, the weak and sickly CIS, is a kindly fiction nobody believes in. There is no "Commonwealth of Independent States." Even the "Russian Federation" is eight-tenths pretense. The reality is Russia - a beleaguered ethnic nation whose members were both victims and perpetrators of one of history's grandest failures - the only major power in the world that is entirely surrounded by more or less hostile former communist states. And today, the loudest boasts of economic achievement coming out of Pavilion Four are coming from Microsoft's Bill Gates.

The vista out the icy front doorsteps of Pavilion Four is dominated by an epic construction in socialist-realist statuary. World famous, it is known as "The Worker and the Kolkhozina," a kolkhozina being a female collective farm laborer. The dual statues are 24 meters tall and weigh 75 metric tons. The work was erected in the depth of the Great Terror - in 1937 - a grisly year in which Stalin annihilated three million of his fellow citizens. The brawny Worker hefts his hammer overhead, while the buxom Kolkhozina gamely waves her sickle beside him; the two are poised to take a decisive leap off their three-story stone pedestal, to tumble headlong into empty air.

Having wandered through the 43 booths staffed by 62 exhibitors at the Windows Expo, my companion and I decide on a closer look at the giant statues outside. That companion is Valery Ponomarioff, a longhaired, chain- smoking 17-year-old Einstuerzende Neubauten freak and trilingual Moscow State U. philosophy major. I met Valery at the Windows Expo. Valery likes computers.

There's a door at the rear of the monument's base. The door had a lock once, but the lock has been kicked out, and the door itself has a rust- eaten hole through it half the size of a manhole cover.

The wretched door shrieks open as if affixed to the House of Usher. Inside, the base of the giant monument is a hollow three-story cavity, unlit and entirely unfurnished, with walls of badly mortared, crumbling brick. It looks like a junkie's shooting parlor, with chest-high heaps of mortar dust and splayed-out, urine-soaked cardboard boxes where bums have been seeking shelter from the snow.

"Smells like teen spirit," comments Valery wryly, his accented English echoing inside the tomblike brick. He's a hip kid, young Mr. Ponomarioff; in his tartan shirt, beat-up boots, and trailing duster overcoat, he's visually indistinguishable from a Seattle grunge-rocker.

Two tall flights of narrow iron rungs lead up inside the brick foundation to the foot of the statues proper. These rungs are eaten-away with rust and lack a safety rail, so naturally we have to climb them.

We emerge in fresh freezing wind onto the monument's snow-covered base, amid two pairs of gigantic socialist-sensible shoes, liberally daubed with grafitti.

Seen this closely, the gleaming statues are a riveted patchwork of aging, tin-plated iron, not unlike the Tin Man's get-up from The Wizard of Oz. There's a huge, embarrassingly situated hole right under the Kolkhozina's skirt, offering a gynecological glimpse of her rusting interior girders.

The Worker and Kolkhozina were creations of one of Stalin's official artists, Vera Muchina. I later found a large, glossy, official book of Comrade Muchina's oeuvre on sale in a Moscow used books store, for the whopping sum of US80cents. Even for that meager fee, though, I couldn't bear to possess the book, even as a curiosity. Vera Muchina created art of such supreme and deliberate ugliness that it inspires real dread. And the sculptress herself, jowly and narrow-eyed, was a dead ringer for a prison matron.

It's hard for an American to fully recognize the extremity of the collapse here, but the fate of this statue gives a solid clue. The thing is bigger than God and has been here for 60 years, yet absolutely nobody gives a tinker's damn about it. They can't even be bothered to pull it down, the way they spontaneously pulled down the hated monument to KGB butcher Felix Dzherzinsky. Nobody cares. It's all over.

For Russia is a country that has collapsed entirely through its own internal self-disgust. It's a conquered country without the luxury of an occupying army. The USSR wasn't shot to death, or bombed or burned into submission; it was eaten away from inside its own iron walls. Nothing remains of the USSR now but dry rot, mortar dust, and a bad, bad smell.

Back inside Pavilion Four, the 62 exhibitors are going at Industry Biz, hammer and tongs. The new, infant legion of Russian software companies, hardware joint ventures, and associated digital entrepreneurs have high hopes for the advent of Windows in Russia, for two good reasons. First, users of Windows have expensive, advanced machines, and they may therefore be sufficiently well-heeled to actually pay for their software - an oddity to date in Russia. Second, the country's current computational OS base - DOS pirateware - is riddled with at least 800 different viruses.

On the first day of the Expo, only 4,000 people show, but among them is a Moscow TV crew. The next day 10,000 people make it, stamping in dirty snow to wander the broad, brightly lit aisles among the cream of the incipient Industry. There are the locals and the joint ventures: 1C, Acer, Autograd, Combellga, Interkomservis, Kami, Megacom, ParaGraph, Steepler, Stoik, Virtus, Zema-Soft. And the sophisticated, market-canny foreign contingent: Autodesk, Borland, Compaq, Digital, Intel, Lotus, Microsoft, Xerox, Sun.

And Apple. Gutsy Apple is crashing the Microsoft Windows Expo, carrying the war to its on-and-off enemy. Apple is doing a demo of the Houdini operating system to a large and interested crowd of bespectacled Russian hackers in fur hats, and dapper Russian nascent capitalists with hyperinflating rubles burning a hole in their pockets. Apple has a tiny, vanishing share of the Russian market, but its local staffers are young and full of can-do Cupertino spirit; they just re-ran the Apple 1984 ad dubbed into Russian and are selling Macs in Russia as fast as they can pitchfork them off the back of the truck.

Over in the Radio 101 booth are two jeans-clad media dudes from one of Moscow's rare, independently owned radio stations. Radio 101 plays rock music. Mostly Western rock - REM, Nirvana, U2 and such - but every hour they loyally wedge in some locally produced sounds: Aquarium, Brigada C, Nautilus Pompilius, Machina Vremya, Alica, and Kino.

Valery and I have a few words - Valery translating for me in rather desultory fashion - with Radio 101 DJ and ace crime reporter, Kirill Kalyan. Kirill's program is a big hit on car radio because Kirill, a bluff, hearty, six-foot-plus bruiser with a mike and a hip-slung recorder, likes to hang out in underworld bars with hookers, black marketeers, and up-and- coming mafiosi. Kirill carries a purple nylon rucksack with spare tapes, play lists, and a sharp, broad-blade, wooden-handled, 8-inch pigsticker in case things get nasty. Things rarely get nasty for Kirill Kalyan though, because Kirill is pretty well known around town, and Kirill talks really fast. And, Kirill informs me cheerily, Russian gangsters like to brag. They know it's not a good idea to openly boast of their crimes on his radio program, but they know everybody else is listening in, so they just can't help themselves.

I ask Kirill if any of the Moscow gangsters he knows use computers. They don't. They are, however, major fans of beepers, pagers, and cellular phones. I ask Kirill why Radio 101 has a booth at a Microsoft Windows Expo. Advertising, he says. Computer advertisers have real money and are generous with it, and they're interested in Radio 101's market - the young, the hip, and the up-and-coming (of various stripes).

I ask Kirill his personal opinion of the Windows Expo attendees. Kirill shrugs cheerfully and says that he's never seen such a big crowd of harmless, wimpy, overpaid, yuppie nerds - or words to that effect, anyhow; once the Russian street slang shows up, our thin bridge of translation buckles and collapses.

In an auditorium at the back of the Expo, the extraordinary personage variously known as Esfer, Esmer, Ester and Esther Dyson is holding panels for Russian Industry participants. Esfer - Russians aren't real big on hissing, alien "th" sounds - favors panels with admirably simple and straightforward topics such as "How to Make Money Developing and Selling Windows Applications in Russia."

Though her Russian seems quite fluent, Esfer doesn't say much. She's not fiery, not conventionally charismatic, and she certainly doesn't harangue her audience. But she listens well, she asks intelligent and focused questions, and she keeps gently bringing the panelists back to the topic at hand. Once wound-up and in the spotlight, Esfer's Russian panelists tend to lose their mental grip on Windows marketing tips, and lurch without warning into hand-waving, metaphysical speed-raps. In the end though, the audience - maybe 60 people, but a very intense and attentive 60 people - learn useful things.

Industry people here adore Esther Dyson. They keep her picture on the walls of their offices like an icon of the Madonna. It's hard to explain exactly what it is that Esther Dyson does in Russia, but whatever it is, it's certainly deeply appreciated. It would seem that Esther simply networks - she keeps picking up loose ends and knitting them back into the middle of the ball of yarn, to general satisfaction and enlightenment. Esther Dyson is a catalyst; she herself doesn't seem to change at all, but given time and heat, everything around her changes utterly.

Toward the end of the Expo, when the crowds are dying off and people are beginning to unplug their humming megabytage from the Pavilion's unbelievably primitive, grimy, and hazardous electrical system, I end up behind the booth of 1C, a Russian company that sells databases. I have a prolonged chat with the company's founder and CEO, Dr. Boris Nuraliev.

Dr. Nuraliev has good English and better Armenian brandy. I'm slurping brandy out of a spare tea cup amid stacks of floppies and wads of rubles, as Dr. Nuraliev explains to me how he, a middle-aged mathematician and Soviet government mandarin, got into the software business.

Dr. Nuraliev once worked for Goskomstat, a centralized state economic- planning statistics unit. He designed databases - excellent databases, state-of-the-art databases, workable databases with innovative design and a plethora of programmer's bells and whistles. He was honored. He was respected. He was well treated and well paid. And nobody ever used his databases. Nobody. Not one bureau, not one person. Not ever.

Eventually, this horrible neglect wore a hole through the programmer's soul of Dr. Boris Nuraliev. He simply couldn't bear the utter uselessness of being smothered in velvet any longer. He resigned from his institute - or rather, he hollowed it out from the inside, using its former employees and its own facilities to set up a moonlighting enterprise that eventually went semiprivate. Dr. Nuraliev redesigned one of his databases as a commercial PC bookkeeping product for the Russian market.

The product took off like a rocket. Now his company, 1C, is thriving, a star of Russian computer entrepreneurism. Dr. Nuraliev has accomplished the seemingly impossible: He has transformed himself from a middle-age make- work Soviet bureaucrat into a productive and successful software mogul of the 1990s. Having conquered the intricacies of bookkeeping, he is moving into retailing and servicing online databases, electronic markets through which computer-equipped retailers and distributors can bypass and ignore the palsied Russian mails and the creaking, buzzing Russian public telephone system.

Dr. Nuraliev has become a big commercial success. He sighs in mid- recitation, rubs his graying mustache, and has another brandy. Two of his young, well-dressed, eager employees show up backstage with a horse-choking wad of rubles, and there is a brief, intense conference in Russian. A staffer searches the litter backstage for a tea bag or some instant coffee. There is no caffeine left. Over the four-day Expo, the staffers and their bigger-name customers have drunk it all. We console ourselves with more brandy.

Dr. Nuraliev suddenly begins reminiscing about the Apollo-Soyuz project. This 1970s meeting of cosmonauts and astronauts, cosmic knights of the superpowers peacefully shaking hands on the equal footing of total weightlessness, has a primal symbolic importance in Russia. Russians seem to have felt Apollo-Soyuz very keenly, as a kind of validation, a rare gallant salute from the enemy superpower that usually treated Soviets with unconcealed loathing, fear, and contempt.

Apollo-Soyuz was a definitive cultural event in Russia. There's even a brand of state cigarettes called Apollo-Soyuz. The event got massive state TV coverage. Dr. Nuraliev recalls aloud the responses of the cosmonauts and astronauts when interviewers asked them what they considered "the most important thing in their lives." To a man, the cosmonauts declared themselves pilots - men born to fly, men who lived to master the challenge of high-performance spacecraft and aircraft.

The American astronauts, though, said the most important things in their lives were their families.

Dr. Nuraliev told me that he found this statement very puzzling at the time, but not any longer. He has seen the Market change people - change his friends, change their lives and their souls. They've become focused, competitive, harder, and more calculating. Life is a struggle now, a ceaseless fight for commercial advantage. Once, says Dr. Nuraliev, he considered himself a mathematician - a programmer, first and foremost. Now, he says, he finds that his own family has indeed become the most important thing in his life. His family is the place where Dr. Nuraliev goes to escape the terrible pressure of the Market.

I'm living with a family of ballet dancers on Petrovsky Boulevard, in north central Moscow. They are Mikhail "Misha" Aleksidze, his 18-year-old wife Anna, their two grannies, Ida and Mme. Marie, their little urban sheepdog Grem, and Zaika, their moon-eyed teenage hooligan of a cat. The mom of the family, Ludmila, is also a ballerina and is off touring Poland.

The Aleksidzes have a spare room. They live in a Czarist-era aristocratic townhouse chopped up into flats. Tchaikovsky used to compose a couple houses down the street.

Misha is a minor figure in the Bolshoi. Anna dances for a children's theater and sometimes does command performances for small but highly appreciative audiences of Muscovite software moguls. The Aleksidzes take me in and shelter me for two weeks, not because I'm paying them, but simply because I know some people who know some people.

Though they are professional dancers, and a strikingly attractive couple with really, really good posture, Anna and Misha are not at all affected or theatrical people. They just cook soup and sausage on their ancient gas range, watch color TV at night with their chain-smoking granny, and then in the morning eat bread and cheese and go out in the snow to their ballet gigs, where they dance their beating hearts out.

To know them is to love them; it's that simple.

Misha and Anna don't speak English. I don't speak Russian. Late one night around the cabbage-reeking stove, we have a long, enlightening conversation that consists entirely of the names of Russian and American authors and composers. "Scriabin!" "Duke Ellington." "Jack London!" "Dostoevsky." "Theodore Dreiser." "Anna Akhmatova!"

I have the good fortune to see a private performance by Anna's troupe. To see these consummate professionals display their art at point-blank range is shockingly intense.

The performance is rich with suffering. A woman emulates the dying swan, her pale arms and wrists fluttering in anguish, and as she sinks to the stage floor, her beautiful, erotic back shows corded muscle as taut as a weightlifter's. The Muscovite software people - all eleven of them - applaud wildly.

Meanwhile, outside the dingy finery of the Dom Rossiyskoy Central Army Theater, the spectre of the Russian bear shakes the streets of Moscow. Its concrete claws split into high-tech ceramic. Its rotten yellow fangs mutate into shatterproof plastic, its panic-blurred eyes become corporate mirror glass. And its scarred, dusty, ancient hide sprouts glossy nets of fiber- optic fur.

Late one night - it always seems late at night in Moscow in December, because the sun set at around 4:30 p.m., and when the sun set it wasn't kidding - two strangers show up at the flat on Petrovsky. Two mustached hustlers, one in Velcro Adidas and the other in a battered fur hat, arrive straight from the set of Terry Gilliam's Brazil to fix the family's ailing water heater. Misha stands on a kitchen chair to beam the dangling kitchen light on the problem, while I slurped my vegetable soup in the corner.

The inability to speak the language makes one silent and watchful and deeply helpless, a kind of adult 6-year-old. I hear gas seeping from the heater's ancient stopcock as the self-appointed plumbers set-to with a monster pair of pig-iron pliers from a battered leather valise. Anna, Ida, and Mme. Marie watch with cheerful interest, offering advice gratis, the whole ballet clan turning suddenly into amateur natural-gas hackers.

I expect to be wrapped in a sheet of flame at any moment. A domestic Chernobyl.

But it never happened. Or at least, it didn't happen this time.

Americans have too much time on their hands because all their gadgets work. Americans worry far too much about little things.

The extent and nature of the damage to Moscow's basic urban infrastructure challenges credulity. It looks very much as if the city has suffered through decades of a general strike, some nonviolent but extremely determined campaign of full-scale, deliberate, Gandhian social noncooperation. The decay goes far beyond mere carelessness, slovenliness, or bureaucratic inefficiency. It approaches obsessive-compulsive behavior.

Suppose, for instance, that some giant, filth-spouting, ex-military truck careens headlong into the corner of a Moscow building (a not infrequent occurrence). Somebody will arrive fairly soon, replace the smashed wall, replaster it, and do a fairly good job of it, too.

But then the painters won't show up. Or the painters do show up briefly, but they decide they have the wrong color of paint, so they somehow postpone work. Indefinitely. All their repair gear is left there in place, abandoned to distant posterity like the brickyards of Pompeii.

Moscow is measled all over with incomplete repair jobs, a thousand empty promises that something might someday work, while nothing is actually allowed to work. Everywhere you turn in Moscow, there is "temporary" scaffolding gone permanent and cobwebby and eldritch. Every person in a city of ten million people walks right past it for years, without a second look. It doesn't seem to be anybody's problem but God's, and God is busy elsewhere.

This is a country where, for decades, only four kinds of people lived in actual material comfort. There were sometimes real rewards for the first group, the creeps willing to become soulless, jargon-spouting, Party- loyalist androids. There was always real power and influence for the second tier, the Army, the KGB, and the other direct accomplices in the crimes of The State. In the Brezhnev era, black marketeers did pretty well too. And there was a certain ration of tawdry finery for an unabashed prostitute.

But that was about as wide as the gamut ran in the way of material luxury. As a result, Muscovites directly equate poverty and squalor with elemental human decency. Cracked ceilings, leaking faucets, and moaning, clunking radiators are signifiers of moral integrity.

On the other hand, Moscow is the city where people in the rest of the ex- USSR positively long to go. With the possible exception of St. Petersburg, Moscow is about as good as it gets in Russia. And where Moscow gets good, it's pretty good. Though nothing in Moscow, even the fabled Metro, is without its scars of corrosion and decline, none of Moscow approaches the absolute devastation of say, the South Bronx. Meanwhile, large areas of Moscow have a cheery, charming, unmade-bed informality about them. They basically look like student housing or college slums - places where generations of romantically careless young borders have passed through life without ever taking their environment personally. Parts of Moscow have deep raffish charm, real architectural character, and a sweet air of downwardly-mobile gentility.

You can get along in Moscow, by means not always conventional, by means not always legal. People make allowances. You may not have the cash, but there's always some good Joe around who'll spare you a cig and a chunk of sausage.

It's a great city to be slobbering drunk in; if you knock something over or throw up on it, people don't get real upset. The damage just blends right in.

Then there are certain other places like the Hotel Metropol, with its posh restaurant and working elevators and its small army of tall, dapper security escorts. The Metropol is clean and elegant and comfortable, a fortress for foreign wealth, and for foreign behavior. The hard-currency hookers at the Metropol look nice, like early 1970s American coke-snorting party girls. In Moscow though, the Metropol is deeply alien. Although it's an old and honored hotel, the Metropol appears to have been flown into Moscow and dropped here by a spacecraft from the Planet of Tidy People.

Some Russians today believe that they are being colonized by America, and they resent it. That's not the truth, though. The Russians are not that lucky.

If you walk the streets of the US today, you can't really tell that Americans won the Cold War. In the streets of Moscow though, you can't take ten steps without knowing that the Russians have lost a major war, and they lost it big-time.

If there were American Marine MPs on every street corner, if General Douglas MacArthur were here hanging Russian war-criminals and dictating a new constitution, it would be a lot more personal, more comprehensible, less blood-chilling than the subtle process of utter cultural and economic defeat that the Russians are currently enduring.

Everything in Russia that was frozen solid during 50 years of Cold War is being blown apart in a devastating whirlwind of Coca-Cola, hamburgers, pop music and candy bars. Everything is for sale. Everyone is on the take. Crime and corruption have gone beyond moral opprobrium and become a daily necessity. The entire economy has collapsed into whirling dust, into viral cells: kiosks, blankets on the sidewalk, a plastic shopping-bag, the trunk of a car. It is an economy running on perks and backstage influence only beginning to make the transaction to an actual medium of exchange.

All the gigantic state enterprises are disintegrating, because every Jack in them with the least spark of genuine enterprise is cutting himself a private commercial fiefdom from the corpse of the state economy. The giant state enterprises are the main villains of the Yeltsin hyperinflation; it is impossible to make these hopeless money losers even appear to survive, without drastically debasing the Russian currency.

There is no more taxi service to speak of. If you want a ride, you stick out your thumb on the sidewalk and some trusting soul pulls over in his Lada and you bargain for cash. Then he drives you where you want to go. Unless he's mafia, in which case he drives you off, pulls over suddenly, beats you up, rifles your pockets, and leaves you bloodied in the gutter.

Russia today is an economy where who you know means everything, a fractal landscape of backdoor deliveries and conspiracies in restraint of trade; a continent-sized bordello of undercover sweetheart deals. State authority inspires open contempt. New decrees and restrictions are issued from on high every day, and sail right over the heads of the populace without meeting the least resistance from the fabric of reality. Anything is possible, except surviving while obeying all the laws. Corruption is absolutely inescapable. This is the coziest possible arrangement for a mob racket.

The entire nation is a mob racket, basically; the only real difference between Russia's nascent class of capitalist entrepreneurs, its former- Marxist upper-class nomenklatura, and the actual Russian mafia is in their differing degrees of eagerness to use intimidation, coercion and force.

The Mob, the Racket, is everywhere: north, south, east, west, top to bottom. In Moscow, the Mob is not some accident or curiosity or unnatural passing annoyance. The Mob is the sine qua non of how things are done throughout the society. The Mob is not yet sophisticated, but it needn't be, because the economy itself is not sophisticated. The Moscow Mob is mostly a simple protection racket. Skim 10 percent off the top from a city block full of kiosks through the muscle of your ex-Afghani enforcers, and you can buy pagers, cellular phones, and a Mercedes-Benz. A city the size of Moscow will sprout mafia staff cars like a plague of boils.

The Moscow mafia is making inspiring everyday people with fear its business, and it is succeeding in that business. They don't have to kill large numbers of people; they do kill one another with some regularity, but for the marks and suckers they use ritual public humiliation. They'll burst into a restaurant, throw wine over a man's wife and then haul the man outside to smash his face bloody against the frozen brick. He'll probably pay after that, and as long as his scars show, he makes for good public relations.

Moscow's professional drivers and chauffeurs, like taxi people anywhere, are streetwise souls with a lot of contacts. They get shaken down a lot by mobsters. If a driver doesn't pay up, he gets a beating, while the trunk of the car is broken open and its contents are dumped in the street. Almost every driver in Moscow is running a private black-market enterprise out of his trunk, so this is the equivalent of having one's kiosk sacked and burned, also a favorite Mob tactic.

The Mob is gonna be here a while. They have long-term plans. Lately, the upper echelons of the Mob, the real operators, have been killing bankers. They shot 37 Russian bankers in 1993 - deliberate street hits - gunning bank officers down at the doors of their apartments.

While I was there, the bankers went on strike for a day to protest the lack of police protection. The bankers' strike didn't matter much; the Russian police cordially despise bankers. Russian police are living in the midst of a frenzy of capitalism, but they don't have to like it. Russian police like rich-creep Russian bankers about as much as American police would like rich-creep American crack dealers if cocaine were somehow legalized in America. So the Russian Mob is deliberately murdering bankers, specifically those relatively honest bankers who interfere with the Mob's titanic money-laundering schemes.

It's a death-struggle over basic, primal control over the Russian economy. The Mob seems to be winning. A lot of bankers are already in the Mob. The serious Mob people aren't the street-corner guys chain-smoking their Marlboros - the truly serious Mob people are former nomenklatura people, former State Security people, powerful people who've never known an "honest profit" and aren't real interested in learning when there are alternative methods of obtaining money and obedience.

There are still some queues visible in the streets of Moscow. Almost all of those queues are in front of the peculiar enterprises known as "Obmen Valuta," or Currency Exchanges. There are two currencies in Moscow: the de facto currency, the American dollar, and Yeltsin's contemptible funny money, the Russian ruble, inflating at the rate of 100 percent a month.

Along with the dual currencies go dual economies. Hard currency shops intended to exploit foreigners peddle goods with savage markups over equivalent goods available for rubles. So it's off to the Obmen Valuta to buy dollars for imported items available only with dollars; then back again to turn those dollars back into rubles to buy food and other government-subsidized and Russian-produced necessities. The whole process shuffles back and forth through the of millions of Muscovites a day, the entire economy repeatedly shoved through the eye of a needle, back and forth with increasing and terrible speed, as the government's printing presses spin like gyroscopes and the unnatural dual economy implodes.

It would all fall straight to hell, except for the solid flooring. The floor holding up the Russian economy today is the US economy: the stark fact that the dollar - the omnipotent currency of its triumphant capitalist enemy - is beyond the ability of the Russians to affect it in any way.

The dollar is God in Russia, and its owners can live like kings. You can buy a caviar sandwich for one dollar. Dollars open the armored hotels and the pricier restaurants where string quartets play over the wild boar and roast sturgeon. Prostitution is rampant now; if you're the kind of guy who is into that sort of thing, you can possess any number of beautiful women for a Yankee carpetbag full of trinkets.

This is a hell of a time to be a woman in Moscow. Sexual equality was one of the shibboleths of the old regime, and even though it was poorly observed in practice, postmodern Russia has rejected it utterly. Now Russian women have cheap Western cosmetics by the truckload, and they use them as if sex-appeal were the only bargaining chip left to their gender. Moscow is awash in minks, sables, inflammatory lingerie, spike heels, miniskirts, and thigh-high vinyl boots. The magazine racks are ablaze with Elles and Cosmos and Eurofashion rags.

Muscovite women are dressing to kill. The first really big queue I ever saw in Moscow was in the GUM store (whose name hides some mysterious Cyrillic acronym); here was a peculiar, striking line of at least 40 knock-you-dead- and-stomp-you-gorgeous women. They were patiently waiting to study models cat-walking at a fashion show.

The traditional Nina Krushcheva Look - squat, dowdy, chunky, kerchief- headed, with a string-bag full of state sausages dangling at ankle height - is history. Not that the Nina-type herself has gone; she's just mutated. Give Nina a perm, a wool beret, a Benetton bag, and a tasteful salmon-pink overcoat, and suddenly Nina is giving Barbara Bush a serious run for her money.

Muscovite women look like Parisiennes now, only more uncertain and intense about it. Moscow's women today are without question the sexiest, hottest babes in the eleven recorded centuries of Russian culture. Yet at the same time the Russian population growth rate crashed by 12 percent in 1992. The Russian index of female fertility is now at 1.4 children per woman, where a rate of 2.16 means zero population growth. For all their new Victoria's Secret finery, the women of Russia are quietly engaged in a massive popular vote against the future.

Russia today is suffering 12.2 deaths per thousand, against only 10.7 births. The health system is breaking down, with menacing rises in tuberculosis and diphtheria. The water of Moscow is infested by giardia, a highly infectious protozoan causing stomach cramps and diarrhea.

Elderly Russian women are in especially dire straits. Retirement-fixed incomes supply not even the fiction of a living. An ugly Mob racket has sprung up recently, in which hustlers show up at rent-stabilized apartments disguised as repairmen and evict weak and elderly women, supposedly for "repairs," but in practice, permanently. The Mobsters simply change the locks, immediately rent out the valuable apartment to fellow racketeers at vastly inflated prices, and leave the old women to the tender mercies of the streets.

The police have caught onto this practice recently, so mobsters have begun silencing witnesses by simply killing the old women out of hand. This sounds like scare talk, but people believe it to be true; the grannies at Petrovsky Boulevard were seriously afraid of apartment bandits and never opened the iron-barred door to a stranger.

Every certainty in the life of the old and helpless has disintegrated. They are too old to change, and there is no role left for them in postmodern Russia. Small wonder that they are seriously nostalgic for the three kinds of state sausage, the 5-kopeck subsidized trolley service, and the unchallenged certainties of the Party Line. As conservatives are fond of saying, "Stalin may have done some odd things, but when he died there was not a penny in his pocket!"

Stalin felt small need for pennies, since he had the entire population bloodily crammed in his pockets; but for those without money and no prospect of getting it, the absolute need for money has become a tyranny all its own.

These are interesting times for alternative Russia. The variant bohemian tribes of Moscow have a solid advantage over Western hippie types. They simply weren't implicated in the grotesque cruelties and utter collapse of their nation's Establishment, so they're taken with rather more moral and political seriousness than their generational compeers in the West.

A figure such as Boris Grebenshikov, charismatic lead singer of the Leningrad supergroup Aquarium, has a kind of moral authority that Bob Dylan might have achieved if hippies had actually levitated the Pentagon. Moscow's Armies of the Night, clustering on Arbat Street with their acoustic guitars and bottles of cheap port, look pretty much like hippies anywhere - but Yeltsin owes them. Moscow's hippies built the roadblocks and bonfires during the abortive coup of 1991 - especially at night.

During the recent shootout with parliament, the street hippies didn't take sides. They were there in large numbers "to watch the war," swilling port and vodka and smoking Ukrainian hash as Yeltsin's tanks methodically smashed the rebels, but they chose not to get in the way.

There are now two Arbats in Moscow: the older Arbat, a classic boho drag half Currency Exchange and half squatters' dives, and the newer and much bigger Arbat, the Novy Arbat, formerly Kalinina Prospekt.

Mikhail Kalinin was Stalin's titular head of state from 1923 to 1946. Kalinin lacked the courage to defend his own wife from Stalin's purgemasters, so the unhappy Mrs. Kalinin was spotted by eyewitnesses in the depths of the gulag "scratching the lice out of the seams of her prison clothes with a bit of glass from her broken spectacles," in the memorable words of Yevtushenko. Kalinin's street is gone now and Kalinin isn't missed. The tribes, meanwhile, grow a little in size and boldness every year, and the police fail to jail them and break their spectacles.

The tribes come in a wide variety of flavors. First there are the "Olds," the now late-yuppie original hippies of the early 1970s, long-hairs in relaxed jeans who are big in media and pop music. Quite a lot of the Olds have money, at least in comparison to their little brothers and sisters, the "Pioneers" - named in derisive parody of the official Communist youth- league pioneers.

While the Olds are off in basements dubbing pop tapes for the kiosks, the Pioneer kids, post-Gorbachev children, are the larger street presence today. They wear bell-bottomed jeans smeared with black-inked grafitti, known as klesha. They also sport cheap trademark glass-and-plastic wrist bangles known as phenetchka, and, perhaps oddest to Western eyes, little dangling leather stash-bags on cords around their necks. These are known as ksivnik - passport pouches.

Women Pioneers have the same hand-stitched headbands and the same penchant for acoustic Beatles sing-alongs as their male compeers, but also wear black nail polish, big funky shoes, and long, vaguely pagan earrings.

A unique Russian contribution to counterculture are the "System hippies," J.R.R. Tolkien fanatics who espouse a kind of Russian-blood-and-Russian- soil-Green-back-to-nature mystic ideology, like a New Age hybrid of Rasputin and a hobbit.

Then there are "Rockers," the biker boys with their big rings, zippered jackets, tattooes, and combat boots, shading into the legions of heavy- metal fanatics of Metallica, Anthrax, Kreator. I question whether Metallica has ever made an honest dime out of the Russian pop-music "market," essentially a giant seething thieves' den, but Metallica may take comfort in knowing that it has a huge fraction of the coming Russian generation completely in its thrall, utterly prostrate with hero-worship. Much the same goes for The Cure, Depeche Mode, and the smaller-scale Russian cult of techno kids.

Then there are the native Russian pop-fandoms, Grebenshikov and his ilk for the Olds, the punks going for the band "Alica," and the powerful death cult of the recently deceased Victor Tsoy of the band "Kino." Tsoy, who died in a car crash, was a mournful soul who sounded rather like a harder-rock version of Nick Cave. He is now an integral part - along with Lennon and Morrison - of a Russian Holy Trinity of iconic dead pop stars. Of the three, Tsoy has the most fanatical devotees, who have turned two grimy walls of an alley in the Arbat into a spontaneous graffiti memorial.

The last great Muscovite youth faction is known as "Gopota," singular "Gopnik." The young Gopnik is easy to spot. He wears Western pro sports jackets by preference, Chicago Bulls basketball jackets being a massive favorite, along with dark nylon sports pants with jazzy diagonal stripes, and Adidas or Reebok running shoes. In summer he wears a billed baseball hat, and he always has short, neat, brush-cut hair.

He travels in gangs, because he is a criminal. The Gopota are apprentice racketeers. The Gopnik generally carries a beeper and, unlike his hash- dazed, rock-poetry-spouting compatriots down on the Arbat, the Gopnik always seems to know where he's going.

The Gopnik's boss has the same haircut, wears a shiny business suit, a neatly knotted silk tie in a solid color, leather shoes, and a Rolex. Sometimes there are tattooes on his fingers under the gold rings or on his wrist under the Rolex. He has a Mercedes outside at the curb with a security beeper key for his autolock.

The Mob Boss's little Gopota running-buddies are about the nerdiest-looking crooks one could imagine; by Yankee standards they look like a bunch of bowling-league white kids looking for a pick-up basketball game. But when you see them wolfing down the double cheeseburger at the Moscow McDonald's (and paying from a wad of cash), you realize these guys in the sports pants and running shoes are rather efficiently dressed for beating the living daylights out of somebody and then departing the premises at high speed. Four or five Gopota (and there are always four or five of them) are not guys you want to meet alone in a Metro subway car.

Moscow is a city of informal associations, whispering cabals, backdoor dealers, and, yes, users' groups. All formal associations were supposed to be registered by the state, so all non-governmental associations still have a certain tang of the forbidden. Nevertheless, people still associate, privately and very intensely. For decades this has been the only way to find enough to eat.

Up at the top sit the Kremlin's secretive influence cliques. Then the nomenklatura set. Then the organized criminals. Then the dissident groups.

The world of computing is no different. Moscow has nascent Industry groups, such as the "Software Market Association," and the rather more formal "Association of Russian Firms Manufacturing Computer Systems and Software." The recently founded ARFMCSS consists of neo-corporate heavy-hitters from Steepler, Eximer, Intermicro, Stins Coman, Technoserv, Kami, Krasnaya Volna, et al., "united by a common idea of establishing a civilized market of informational technologies." In other words, a Russian computer and software market that actually works. A market in which one can actually make a secure and predictable and legal living. A market whose leaders will someday, with luck, live like kings. If they don't end up in the gulag scraping lice out of their seams with the broken screens of their laptops.

And then there is the Ball of Yarn crowd. They meet in a place called "Club OK," a children's computer club on Roshdestvenski Boulevard in north central Moscow. "Clubok" means "Ball of Yarn" in Russian, and the Anglo- Russian pun has stuck. Every year about 70 Russian kids show up at the Club OK to learn the basics of programming on a phalanx of aging Ataris donated by public-spirited chess champion Gary Kasparov. This not-for- profit enterprise goes on, year after year, under the aegis of ParaGraph Corporation and its leaders, CEO Stepan Pachikov and his energetic and hands-on younger brother, Georgy "George" Pachikov. George, a demonstrative, charismatic fellow with a pronounced visionary streak, is ParaGraph's vice president for educational and multimedia software. George has fine English and spends a lot of time in the ParaGraph offices in Sunnyvale, California.

The kids have a grand old time on the machines and never pay a dime or ruble for the experience. If there's to be a coming generation of computer industry leaders in Moscow, it will probably be from among these youngsters. In the meantime, though, there are George's other friends at the Club OK: the adults. The club - the Ball of Yarn - meets on Thursday nights to gossip, network, and bootstrap themselves into the future. And to drink some.

If the Ball of Yarn has a "leader" it's probably George, but there's no gavel banging, Roberts Rules of Order, or questions from the floor in the cheerful tangle of club members. The Ball of Yarn members are Industry journalists, programmers, marketeers, and public relations officers, about 40 of them, all told. The only way to get inside the Ball is to know somebody who knows somebody; and when it comes to the Industry in Moscow, the Ball of Yarn knows everybody worth knowing. For instance, they all seem to know Esther Dyson.

The Ball of Yarn runs a little private tabletop bookstore inside the Club, featuring programming manuals, business books, and science fiction magazines. For less than a dollar, I bought a useful specialized English- Russian dictionary called Marketing, published in Moscow in 1991. The hefty pamphlet gives the Russian equivalents for such alien terms as "distributor" (distribyutor), "dividend" (dividend), "document" (dokyument), and "dumping" (demping). It goes on like that for 222 pages.

Moscow has a definite hacker tradition. Muscovites don't excel at making money, because that requires a set of skills that haven't been in much demand. But there are many examples of a kind of demented Muscovite street- tech ingenuity. In the 1950s and 1960s, for instance, rock and jazz fans used to cut bootleg albums on the celluloid from used chest X-rays. Radio Free Europe devotees used to amputate the handsets of pay phones and use the stolen microphones as speakers for illicit radio sets. Samizdat, or self-publishing, flourished under some of the most repressive conditions imaginable, as well as its lesser-known cousin technology, magnitizdat or spoken tape publishing.

The Ball of Yarn can be thought of as a clan of hackers - folks not formally educated in computer science, but devoted to hands-on experience, and entrepreneurial networking - a go-getting, future-minded group of Industry pioneers who would probably be called a "conspiracy in restraint of trade" in the US. If the Ball of Yarn is the bright side of Russian hacker-culture, then the dark side is the virus freaks. Russian computer culture to date has survived on frank piracy, on digital blood- transfusions travelling via floppy from machine to machine. Of late, bulletin board services have begun to spring up in large numbers, but the phone service is dicey at best, and a long-distance call takes determined effort, so in the hinterlands, where Russians build their desktops one pirated floppy at a time from a promiscuous daisy-chain of sources, they incubate a fantastic profusion of viruses.

I found a floppy-disk list of Russian PC MS-DOS viruses - with brief, one- paragraph descriptions - at the Windows Expo, distributed by a company called Dialogue. As a favor, the computer journalists at the Ziff-Davis joint-venture PC Magazine Russian Edition began printing out the list for me, single-spaced, in Cyrillic, on their laser printer. I got 64 pages before we ran out of paper.

Viruses exist in ghastly profusion in Russia today, in dozens of strains. They come from both inside and outside Russia - they come from all over the world. There's Vienna and its nineteen local and alien variants. Cascade causes text to cascade the PC screen into a heap at the bottom. Jerusalem arrived from Israel, and Eddie is the evil brain-child of the Bulgarian heavy-metal fanatic virus writer known as Dark Avenger. There's Stoned, Sunday, V-512, VRN-1536, and LoveChild, which announces itself to be "LoveChild in reward for software stealing."

Hymn plays the official hymn of the now-defunct Soviet Union. SVC comes from the Russian city of Nizhny Novgorod, Tumen from Tumen, Kiev from Kiev, Minsk from Minsk, E-burg from Ekaterinburg, Sverdlov from Sverdlov, Andryushka from Perm, Estonia from newly independent Estonia.

Amoeba, unaccountably, quotes William Blake. The truly peculiar Ieronim displays the theological writings of St. Jerome in Latin. Digger turns the screen upside down. Ion demands a payoff of ten rubles, to be slipped into the slot of Drive A. Ten rubles is currently about eight-tenths of a cent, but that won't stop Ion from multiplying and insanely demanding its joke- bribes in a dying currency.

And mere economic collapse won't stop any of the other viruses, either. Mutant, Datacrime, Problem ("This is Your Problem"), Phoenix ("Live After Death!") Adolf, Pravda, Techno-Rat 1 (from "Lord Blaise of Odessa"), Beer, Goat, Fax, Drug, and Kiwi or Little Girl, a very bad little girl that destroys files. And so many, many others.

Dmitrii Nikolaevich Lozhinsky is a friend of the Ball of Yarn. He destroys viruses for a living. He works for Dialogue Science - "Dialogue Nauka" - in Moscow. Lozhinsky wrote the program AIDSTEST for Dialogue, and he also wrote the description of Russia's 800 viruses that I discovered at the Windows Expo.

On Wednesday December 8, my friend Valery and I went to the headquarters of Dialogue Science on Vavilova Street, to interview Mr. Lozhinsky.

Dmitrii Lozhinsky is the foremost anti-virus expert in Russia. As a dark salute from the underground, he has had several viruses named after him: the clone family of "Lozhinsky viruses." The particularly mean-spirited "Harm" virus declares "Eat me Lozhinsky!" In a bold riposte to the virus underground, Dialogue Science stoutly declares its determination to "Prevent the Computer World from Virus Attacks!" and publicly claims that "Our anti-virus products are inevitably found (often nonauthorized) in almost every computer in Russia and former USSR republics."

AIDSTEST, also known as "Virus Hunter" or "V-Hunter," is subscription-ware; the program is freeware, but periodic updates are sent first to paying subscribers. The fancier "Dialogue Science Anti-Virus Kit" is commercially available and includes "AIDSTEST," and "Advanced Diskinfoscope" or "ADinf." AIDSTEST and the ADinf utilities are the most widely-used antivirus programs in Russia. The Finance Ministry, Moscow State University, the parliament offices, even the vanishingly tiny fraction of Russian police who know what a computer is - they all use AIDSTEST.

And Lozhinsky is its architect.

Dmitrii Lozhinsky was born in Moscow in 1939. He wears gray slacks and brown shoes and a fuzzy academic sweater; he has curly, receding hair, and sad, brown, seen-it-all eyes behind gold-rimmed glasses. He has a modest office in the Dialogue Nauka building, which is on loan to the enterprise from the Russian National Academy of Sciences, the Academy of Sciences itself being a sponsor of the Dialogue joint venture.

When Lozhinsky speaks of the trials and tribulations of his war on viruses, he is not at all alarmist or extravagant. He is a mild-mannered scholar, a career mathematician whose business card identifies him simply as "Programmer," and when he speaks of his opponents in the virus underground it is much more in sorrow than in anger. Lozhinsky is personally acquainted with some 770 viruses. His anti-virus colleagues at the Russian computer firm Kami claim to have catalogued some 2,000 viruses, but the remaining 1,300 variants are little-known in the Russian PC population and of academic interest only.

The worst and most destructive viruses, says Lozhinsky, are generally the least clever, the easiest to program and the easiest to find. The subtler viruses tend to be the more pernicious. Generally, Lozhinsky says, it is not the direct damage caused by the virus that is the most disruptive element. The worst problem caused by viruses is that they always come back. They come back from the backups, and the archives, and from infected disks carried off by all unwitting by staff members and reintroduced weeks or months later. Then all real work grinds to a halt as the infestation is chased down again, and again, and again. It is hard, wearying, frustrating labor.

Lozhinsky has never had any help from any police agency, or from any government group at all, with the exception of indirect help from the Russian National Academy of Sciences. There is an interior ministry of business that investigates white-collar crimes and racketeering, but has never apprehended or prosecuted a virus writer.

After five years of this drudgery, Lozhinsky is clearly and openly tired of it. He would much prefer to do some other kind of programming, something more innovative, something more challenging, something more creative. The work, however, is utterly necessary. And, Lozhinsky says with a weary smile, there always seem to be more viruses; so he is sure that his role in the war will see him through to retirement.

Lozhinsky believes that the problem of viruses has stabilized in Russia. It is bad, and will remain bad, but it is no longer getting any worse. Dmitrii Nikolaevich Lozhinsky is holding the fort. Life will go on.

I asked Dmitrii Nikolaevich if he had some special message for American computer users. After mulling it over a minute, he said, very seriously, that any American programmer has many good business opportunities, and many good uses for his time and skill. No American programmer should ever waste his valuable time by writing a virus.

When we left Dialogue Science's Cybernetic Institute for the slush-filled streets of south Moscow, Valery Ponomarioff seemed deeply moved by his encounter with Lozhinsky. The philosophy student told me, eyes glowing, that Lozhinsky seemed to him a fine example of the true Russian scientific intelligentsia. Not a communist, not a businessman: a real scholar. A man of intellect. Not just some mercenary. A man who did what he did not for money or power, but for the sake of civilization and culture.

A week in Valery's company had been a real education. True, to American eyes, Valery had a few eccentricities. For instance, he liked to turn Cricket lighters upside down and run them across tabletops in a shower of sparks. In Western-style eateries, he liked to pierce and suck the juice out of the coffee-whiteners. And for a 17-year-old male who played drums in a punk band, Valery manifested a profound, not-entirely-healthy interest in Barthes, Foucault, and Derrida - as well as a truly fanatical devotion to his rare and highly prized copies of Mondo 2000.

But his instincts were good. And when he said that he himself hoped someday to become a man like Lozhinsky, I could only wish Valery good luck.

Dialogue Science - the company that employed Dmitrii Nikolaevich Lozhinsky - was, to American eyes, quite a peculiar enterprise. Try as I might, I could not get anyone at Dialogue Science to explain to me exactly what "Dialogue Science" was, or what Dialogue Science actually did. I had no trouble getting their address, but what was Dialogue Science, besides "the daughter division of a Russian-American joint venture?" What were their plans, what did they sell, why were they in business? The very question didn't seem to register. They were very friendly, and obviously very accomplished at programming, and they were trying to help me, but somehow it seemed that their enterprise, or whatever it was, was just - well, there.

But I had no such conceptual difficulty at ParaGraph International, where I was given a brisk tour by ParaGraph's conspicuously well-informed public relations officer, Leonid Malkov. Malkov is a friend of the Ball of Yarn, and his company wrote the handwriting recognition software for the Apple Newton. Though Gary Trudeau lampooned it in "Doonesbury," it must be admitted that the ParaGraph software in the Newton does, in fact, recognize handwritten text better than any such program has ever recognized text before. And, as an extra fillip, this Russian-made software recognizes text in a foreign language.

The ParaGraph people are boiling over with ideas and projects. Founded in 1988 by president-CEO Stepan Pachikov, Paragraph now has 110 people at its Moscow office, and 30 at its branch office in Sunnyvale, California. ParaGraph has plans for a live handwriting-recognition fax-machine, a phone-linked chalkboard that can be as big as an office wall. They're into voicemail, speech recognition, oil-exploration software, and massive databases. They're doing brisk business designing Cyrillic laser-printer fonts, and are moving into font and handwriting recognition for Arabic and Hebrew. They're on Internet and MCImail and AppleLink. They do educational software and computer games. Even ParaGraph's security people, out distributing visitors' lapel badges in the hall, all have PhDs.

ParaGraph recently took over an upper floor of a high-rise in Moscow, one of Moscow's better high-rise office buildings. ParaGraph is a prestigious enterprise and a company very much on the make, but this is Moscow. A room two floors below ParaGraph had recently caught fire, leaving a large black stain on the building's exterior. The first floor of the building - its lobby - hosted an impromptu candy-and-cigs retailer and a small-scale amateur butcher shop. It looked like pretty good meat, actually, some of the best meat I'd seen publicly offered in Moscow, but it was a tad disquieting to see racks of pork chops, whole plucked chickens, and lamb haunches sitting there in big aluminum pans next to the lobby couches.

At ParaGraph I met Anton Chizhov, who claims to be the first Russian ever to write a computer virus. In 1986, the KGB asked Chizhov to investigate the matter of viruses, when the State Security became concerned that viruses might be a threat to the KGB's computers. Chizhov wrote an experimental PC virus that multiplied through .com files on floppies, and would automatically erase itself after a year. The virus did no harm; it only multiplied, but after a few months Chizhov was alarmed to find that his homegrown virus had attacked and conquered every PC to which he had personal access in Moscow - all 45 of them. He told the KGB that yes, there could be a real problem here.

Chizhov hasn't written any viruses since. He is known as an anti-virus expert, but he hasn't worked lately in that field. Chizhov has serious work to do for ParaGraph; advanced algorithms to cook up, projects to brainstorm, money to make. Besides, there's AIDSTEST available, and it works just fine.

The people at ParaGraph are working hard. They're eating regularly. They seem to believe in what they're doing, and appreciate the chance to do it. They have good people, some of the best and the brightest, top-ranked Russian brainpower emerging at last from the economic black holes of Marxist thinktanks and state academies. They have contacts in the global software market that any Russian startup would envy. They're thinking hard. They're coding. Someday, with any kind of luck, they're going to make a whole lot of money. Both for themselves and for their co-owner, Ron Katz, an American real estate investor from Boulder, Colorado.

Alexander Kann is the publisher of PC Magazine Russian Edition, which was a co-sponsor of the Microsoft Windows Expo. While its American associate, PC Magazine, is a fairly dry and technical journal, the Russian Edition is considerably wider in scope, basically covering the entire newborn industry in Russia.

Kann is a handsome, dapper, dark-haired 33-year-old St. Petersburg native, with a computer science degree from a polytechnic university in New York City. Kann is a regular at the Ball of Yarn, and is universally known as "Sasha."

He's been a consultant, a conference sponsor, a journalist, a retailer, a distributor, a board member of the Russian Software Publishers Association, and is now a publisher. "Publisher," though, is a very inadequate description of Sasha Kann's role among his peers; given the scope of his activity, he might be better understood as a kind of digital community activist, a Russian Industry guru.

I met Sasha Kann at the offices of PC Magazine on Gertsen Street, in the heart of Moscow. Though small and elderly, the premises were neat, freshly painted, fully functional, and crammed with new personal computers, spanking-new faxes, and glossy heaps of the latest issue. There are hookups to the Sovam Teleport data network, and to Iskra, the data and voice service formerly reserved entirely for the uses of the KGB. Though it was well after business hours, four PC Magazine staffers in ties and shirt sleeves were still beavering away, and the phones would not stop ringing.

Kann's own office is dominated by a large map of the ex-USSR liberally speckled with red-and-white PC Magazine logos, symbolizing retail outlets for his magazine.

I asked Sasha Kann how the Russian computer industry has developed since he's been covering the scene in the past three years.

He said, in flawless English, that the scene is "more civilized." The gray market is in decline. The piracy problem is receding as people come to understand the advantages of shrink-wrapped software, registration, and tech support. There are more joint ventures, and their activities inside and outside Russia are better coordinated.

What does he expect from the next three years? He frowned. More cooperation between enterprises, yet more new entrepreneurs and workers joining the industry, a lot of growth. But along with that, the well-nigh complete collapse of the earlier Russian computer industry. There is, or was, an internal Russian computer-manufacturing enterprise, state-]supported and creating such oddities as massive DEC-clone personal computers. There is no longer any consumer demand for the state's monster PC VAX-compatible work- alikes, so the whole structure will have to be dismantled and shut down, and its legions of workers fired, or, at best, re-employed in assembly plants making machines that people actually want.

On the upside, there will be more understanding of markets, a liberalized import-export and tariff strategy, and (perhaps) improved distribution channels and telecommunications infrastructure. At the moment, Sasha Kann considers the primitive state of distribution to be the worst drawback to the growth of the industry.

If you want a computer in Russia today, you can't mail-order one. You dare not have it shipped for fear of loss or theft. You have go to Moscow or St. Petersburg or Ekaterinburg, and buy a computer and carry it home in a bag. This will not do.

Sasha considers the great challenge of the rest of the decade to be the glubinka, the vast Russian outback, the boondocks. The computer scene is already red hot in Moscow and St. Petersburg, where a generation of techies who niggled along for years on professors' salaries are suddenly becoming ruble billionaires. The scene is starting to boil in Ekaterinburg, Novosibirsk, Kiev, and Alma-Ata.

But there are eleven time zones in Russia. For those who can make it, for those with the savvy and smarts to build a new world on the dust of the old, there is a lot of room in Russia - nothing but room. Already Microsoft, Borland, Lotus, and Symantec are creating Russia's first genuine software market; in hardware. Acer, Compaq, Hewlett-Packard, and IBM are stirring. Kann is keeping a close eye on the Russian companies Steepler and Perspective Technology.

There are fortunes to be made in Russia - vast, continent-size fortunes. Though Russia lost the Cold War, it is a lot better off than the defeated European and Japanese economies after they traded dreams of world domination for eventual capitalist prosperity. That can still happen in Russia, but it will have to be made to happen.

Sasha believes it is not money, not venture capital, that is really in demand at the moment. There is money around; the problem is deploying it. The true demand is for basic know-how. Marketing skills. A basic awareness of what it takes to build a modern computer industry. Kann would like to see more Americans in Russia. A lot more. There is plenty of good hard work for everybody.

Sasha Kann is a bright, capable, competent, and businesslike Russian cyber- yuppie. Ten years ago people like Sasha would not have been merely oddities; they would have been considered monsters.

Russia is highly productive in terms of monsters. The Russians are capable of profound creativity and great flights of imagination, and of terrible enormities.

And in 1994, the Russians are a people brought low. The Russians are humiliated, and their humiliation is all the sharper, and all the more thorough, because they have no one to blame for their predicament but themselves. All the ugly secrets are out now. They all know - those willing to look - the full gruesome story of their own misdeeds. Lenin's starvation policies, Stalin's purges and meat-grinding gulags, the shameful pact with Hitler, the fantastic scale of pollution and agricultural destruction, the nuclear horrors, Czechoslovakia, Afghanistan. The witch hunts, the nonpersons, the liquidations, the photo fakeries and the memory holes. The lost history has been disinterred in its full impossible scope: It is analagous to a revelation that everything done in America since the inauguration of Calvin Coolidge was a massive and unbearable crime.

The Russians know that their governments have been cynical and tyrannical and murderous. They know that when they worked, their work served bad ends, and that when they refused to work and let their nation decay all around them, they and their own children suffered most. And they know they have lost the Cold War. And some of them recognize that even if they had somehow won the Cold War, then the entire planet would be as desperate as they themselves are now.

They have won themselves a measure of pride in recent years; they're proud, for instance, about defeating the Coup of 1991 - proud that they refused as a people to kneel at gunpoint in the streets of Moscow and eat the cold vomit of Brezhnevism off the pavement.

But it's a fragile pride, like the pride of a recovering alcoholic. They're a nation-state that has spent 70 years in the political equivalent of a violent alcoholic blackout. And then the Walls and Curtains came down with a thump, and postmodern capitalism blasted across their tottering culture in a high-bandwidth metal-screaming blitz of two million lipstick-glossy pixelated colors. The Russians are so near their wits' end now that the basic texture of everyday life seems heightened and surreal, almost eroticized.

They can't go on like this.

It's not possible. And yet the nation - whatever its name is - has been in an official state of "crisis" and "transition" since 1986. The restructuring, the openness, is out of hand and will not stop. To watch the structure of daily life writhe and mutate in Moscow, under the incredible dual impact of Western technology and Western pop culture, is intensely fascinating. It is one of the great postmodern spectacles, magical and comical and seamy, like watching Rip Van Winkle slapped awake, dusted off, doused in cologne and given a PC, a VCR and a safe-sex blow job. Almost any society imaginable would crack under this terrific level of future shock and stress, but the Russians are already so far gone that they simply haven't any choice left. Most Russians today only want Russia to be a "normal country," but this is the end of the millennium, and there isn't any normality left for anybody, least of all Russians.

It's hard to guess what is to come. There seem to be two basic scenarios here. In the first, the Russians somehow win their way through, they measure up. The smarter kiosk owners start grocery chains. The hard cash from the oil shipments gets invested in things like roads and bridges and telephones that function. The malarial fog of the Mob retreats back to the nastier corners of society, and a stable capitalist middle class is established, one that votes for guys who take an interest in useful activities such as urban zoning, rather than screaming extremists bent on killing Ukrainians and annihilating "speculators" and "profiteers." Russian literature, music, movies, and TV creep back out of their current shell- shocked foxholes, and the Russian people regain some kind of consensus reality, some coherent notion of what is happening to themselves and their country, some bone-deep awareness that the crisis has passed, and life is going on, and that it is safe to have children again. Somehow, they come to terms with the unspeakable enormities of their past. Somehow they find a future that seems to them to make sense.

And the other scenario is Yugoslavia - but continent-wide. And that is all too plausible. Almost every Russian Jew with the least inclination to leave Russia is long gone; those Jews who stay are Russian patriots of a devotion that passeth understanding, for the country is infested with psychotic antisemites. In a country almost annihilated by racist anti-Slavic genocide in the bitterest war of the 20th century, there are now Slavic neo-Nazis. It's incredible that people could behave in ways so blatantly self- destructive, but the Russians have so little left to believe in that those credulous souls who must believe in something are believing eighteen lethal things before breakfast. Communism is discredited, socialism is discredited, the very idea of government is discredited, politics is discredited, justice is discredited, law and order are discredited, work and children are discredited, and the hustle is everywhere. People are broke, frightened, and living in a maelstrom that is profoundly out of control.

It would all feel so much better if this mess could be blamed on somebody besides Russians. Azerbaijanis, for instance, or Armenians - two ethnic groups currently being chased out of Moscow under the thin pretext of passport control, a pretext for what is basically a quiet Muscovite ethnic-cleansing effort. The Russian Federation is now 80 percent ethnic Russian, one of the ethnically cleaner "federations" around, but the remaining 20 percent have legitimate cause for worry.

They probably won't go after the Americans. There's no real reason for that any more. There is nothing left for Russians to fight Americans about. Besides, Russians and Americans almost never actually came to blows; we were content for 50 years to threaten to roast each other wholesale. There's no visceral hatred between Russians and Americans, no sense of a deep racial grudge. Capitalism versus Communism was an ideological and economic struggle, and a pogrom is not ideological or economic; a pogrom is about the visceral pleasure one takes in lynchings, village-bulldozings, kristallnachts, and the deliberate murder of alien women and children. The word pogrom is one of Russia's few gifts to the English language, and the Serbs who put "ethnic cleansing" into our lexicon enjoy open admiration in Russia. One of them, Vladimir Zhirinovsky, was elected to Parliament just after I left Russia and immediately declared the Serbs to be "Orthodox brethren" who should be stoutly defended from the various troublesome national minorities they've been busily shelling with mortars.

Zhirinovsky's rhetoric - annexing Alaska, shooting "criminals" by the thousands, shutting down newspapers, having no one but blond, blue-eyed Slavic people on Russian TV - all sounds like some evil lampoon, and yet Zhirinovsky probably is the man whom Ivan Six-pack would like to see in power in Russia. Zhirinovsky says things aloud that other Russians merely mutter. People are fond of Zhirinovsky, they admire his guts; he can move a crowd, he's exciting. A lot more exciting than, say, Yegor Gaidar, ex- architect of Yeltsin's amazing self-detonating economy, a creepy technocrat with zero charisma who always talked over people's heads.

Yeltsin himself, after what he did to the parliament, is far more feared than loved. He's become a dour, Ahab-like figure, lashed to the rudder as the storm of change bewilders and nauseates the crew.

It can't go on, and yet, it must go on. Give it another few years and it will be harder by an order of magnitude to make people shut up. "Shutting down a newspaper" won't stop anyone from learning anything. The guys in the subways who sell TV antennas out of boxes at their feet will have sold a TV antenna to everybody who wants one; the satellite dishes that sprout like inverted toadstools from the walls of the classier apartment blocks will be sprouting from everybody's apartment. The semicriminal capitalist economy will be so widespread that everybody will be implicated. More old people will have died in misery, weeping for their vanished 5-kopeck bus rides, and the Pioneer kids, who have no real idea what Communism was and less-than-zero interest in learning, will be starting to run things for themselves.

For all the horror - and the horror is there, like the damp reek of carrion from the back of a cave - Moscow is a beautiful city. Every day in Moscow was a vivid adventure. I marveled more in Moscow than I have marveled anywhere in many years; it's a fairytale, where the candy-striped decaying palaces are the necessary adjunct of a dead giant that ground-up the bones of children.

I was born in the Cold War, and have spent my entire life in the evil shadow of the sainted Andrei Sakharov's tens of thousands of Soviet hydrogen bombs, and yet I truly loved Moscow. I was charmed by the place, deeply moved, enchanted. I would go back in a moment. I believe that I could live in Moscow. I could live in that fearsome capital, and live its strange, mad, intoxicating, razor-walking life, and with a trace of luck I could even be happy there.

Somehow, a happy Russia seems the least likely scenario of all. A rich, happy, creative Russia. A prosperous, inventive Russia with open hands and great gifts to give to the world. A Happy Bear. Somehow, in spite of it all, and in defiance of what this long and ugly century has told us is good sense, we must try to imagine the Russians happy.

For More Information:

Dr. Boris Nuraliev
(nuraliev@unipi.msk.su)

Dmitrii Nikolaevich Lozhinsky
(loz@dials.msk.su)

Bruce Sterling (bruces@well.sf.ca.us) is author of four science fiction novels, the nonfiction work The Hacker Crackdown, and co-author with William Gibson of The Difference Engine.

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