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A billboard near UralVagonZavod claimed a world record for producing more than 100,000 tanks between 1941 and 2006.
NIZHNY TAGIL, Russia — On Monday morning, like every morning, workers swarmed through the five gates at UralVagonZavod, and wives and mothers maneuvered strollers over the packed ice on Freight-Car-Builders’
Boulevard. In the whole industrial anthill of Nizhny Tagil, there was only one person who mattered — the one who would drive through the main gate on Tuesday morning.
As this city prepared for a visit from Prime Minister Vladimir V. Putin, residents smilingly repeated the same line from a 19th-century poem about squabbling villagers: “The master is coming, the master will sort things out.” This verse has become a mantra in Nizhny Tagil, a city of 400,000 dependent on two colossal Soviet-built enterprises — a belching, billowing steel plant and UralVagonZavod, which produces tanks, freight cars and other heavy metal equipment.
Distress radiated outward when UralVagonZavod began furloughing thousands of workers and cutting salaries. Butchers in Vagonka, the neighborhood that houses most of the factory’s 28,000 workers, saw sales of meat drop by 50 percent. Street thefts crept up. Shops closed. Vegetables disappeared from kitchen gardens. With winter deepening, nothing seemed to offer much hope for the residents of Vagonka. But then they heard that Mr. Putin was coming.
“Putin will come and the whole city will go back to normal,” said Nadezhda Shamova. “He is a wonderful man. A great man. It’s wonderful that he is coming.”
Maksim Paznikov, 39, who has been driving a taxi since the downturn shut his real estate business, was equally confident.
“Everyone is counting on him,” Mr. Paznikov said. “Let them work it out between themselves at a high level. In Pikalevo, they solved the whole problem in two hours.”
Mr. Putin has been seen as a savior of factory towns since June, when he swooped into Pikalevo and forced businessmen there to pay back wages and reopen the limping 50-year-old plant that supported the local economy. Workers cheered, but economists criticized the precedent, saying Mr. Putin focused on calming short-term social tensions rather than addressing underlying problems like crumbling industrial infrastructure, low worker productivity and the hundreds of “monocities” created by Soviet planners.
Mr. Putin last week acknowledged that many of his advisers had tried to dissuade him from intervening in Pikalevo, a monocity of 22,000 near St. Petersburg. But he said he considered the tactic a success, allowing him to make it abundantly clear that business and government would be punished for allowing unemployment to rise.
“True, the problems had developed over decades,” he said, in an annual question-and-answer session that was broadcast on Russian television last week. “However, we are now accountable for the situation, for people’s lives and their financial security, as well as their mental and emotional state.”
Those lessons were not lost on UralVagonZavod, which is state-owned. Orders for freight cars dropped “drastically” over the last year, but rather than resort to layoffs, UralVagonZavod put thousands of workers on forced leave at two-thirds of their salary, said Boris G. Mineyev, a spokesman for the factory’s general director. Six thousand workers are furloughed now, and for one week in November, when the assembly line had to be halted for logistical reasons, the number climbed to nearly 11,000. Furloughed workers are offered public works jobs, painting or cleaning for extra pay from the state.
Despite these efforts, the effect of lost income has rippled out through the city. Workers who dived into credit agreements during the recent flush years found themselves trapped by monthly payments. Galina Teshova, 56, a bricklayer who was laid off from the steel plant years ago, said Nizhny Tagil — a prestigious city throughout the Soviet era — felt as if it was “dying.”
“If I had a chance to leave, I wouldn’t give it a second thought,” Ms. Teshova said. “We are stuck here, because we are afraid if we leave our apartments we may not ever have another one. We are hostages to our apartments.”
Marina V. Alekseyenkova, an analyst at Renaissance Capital, an investment bank in Moscow, said UralVagonZavod’s biggest problem was inefficiency; it also operated at a net loss in 2008, which was considered a good year. The company was hit hard when Russian Railways, its largest civilian customer, slashed orders, but has also suffered because it lost its Soviet-era monopoly and must compete with a Ukrainian product, she added.
The state can refinance UralVagonZavod’s debts, make defense orders or stimulate Russian Railways to increase its orders, but what it needs, she said, is a new business model.
“This is not just a situation that occurred during the crisis,” she said. “It’s not an economically sustainable model.”
Those thoughts seemed distant, though, as workers prepared for Mr. Putin. Festooned on rows of concrete buildings, which end in a flat, frozen expanse of plain, were rousing slogans: “We are known throughout the world,” and “Military production: the work of a real man,” and “The stronger our neighborhood is, the stronger Russia is!”
http://www.nytimes.com/2009/12/08/wo...tml?ref=europe