SVOBODNY, RUSSIA, December 12, 1997 --  

A single Soviet flag waved over the factory in Svobodny. Six years after the demise of the Soviet state, it continued to flap defiantly in the wind -- the same wind that fanned the smoke across hundreds of smokestacks dotting the horizon. The view revealed Svobodny -- a trans-Siberian railroad town 7777 kilometers east of Moscow -- as a city frozen in early industrial time.

A casual visitor might end his observations there. Svobodny seemingly fits the mold of many Russian provincial cities. It has none of the mini marts, cell phones and glitzy advertising so prevalent in Moscow. It retains barren state-owned storefronts, crumbling concrete apartment blocks, and the watchful eye of Lenin's statue, towering over the central square. Indeed, the Soviet founder's party heirs still control the regional government.

Hints of reform are nevertheless evident. A dubbed version of Paramount's Babylon 5 is broadcast via a Moscow network. The run-down gas station north of town now displays a Shell logo. Privately-owned stands in banks and airports prominently display Pepsi^TM, Tylenol^TM and the strangely omnipresent Toilet Duck^TM. Similar imported goods are readily available even in state stores.

These subtle changes are sure to lead to more fundamental reforms. A large influence likely will be the recent opening of the Svobodny Cosmodrome -- a satellite launch facility trying to cater to Western customers. The facility, run by the Russian Space Forces, uses converted Soviet nuclear missiles to peacefully boost capitalist payloads into orbit. The first launch, to be completed next week, has brought dozens of American visitors to an isolated city that had seen few before.

Western contact may lead to more trouble than benefits in the short term. Six years after the collapse of the Soviet state, Moscow has changed dramatically. The capital's amazing transformation was driven as much by concentration of wealth and proximity to Western Europe as it was by direct contact with Westerners. Although it now has Western contact, Svobodny shares neither of the other traits. The absence of wealth in the local economy is disparagingly evident. The nearest Western markets are thousands of miles away in Korea and Japan. These deficiencies combine to make opportunities for growth extremely limited. In this light, close contact with far wealthier Western visitors could be destabilizing.

Sadly, Svobodny is far from the most desperate case. In the regional capital, Blagoveschensk, the dependence on state-owned industry and particularly the military is even more pronounced. Construction projects are halted -- frozen in time on the day the Soviet Union vanished six years ago. The factories that remain open belch smoke so thick that it is at times not possible to see to the next corner.

Modernization of such far-flung Russian regions will not happen quickly. It will likely be delayed until after reform takes the same hold in Russia's larger provincial cities as it has in Moscow. For places like Blagoveschensk and Svobodny, this time may be too late. Periods of economic realignment can be brutal for cities rooted too deeply in an earlier era. The weakest among them may not survive.

*NOTE: Technically, Svobodny and Blagoveschensk are not in Siberia, but in the neighboring Amur Oblast.