Led by 2 L.A. Men : Capitalists Show Soviets How to Do It

A Soviet colonel spoke into the microphone as the capitalists from Los Angeles looked on, surely the strangest of visitors to an army base 60 miles southwest of Leningrad.

Before him, Soviet journalists took pictures. Behind him, the Americans stood proudly. All around was the heady feeling of long-frozen attitudes thawing into something new and unknown.

“I could not have ever imagined,” Col. Victor Makarov was saying as the March wind blustered, “that I would witness what is taking place here today.”

In part, he meant his base’s imminent transformation into a children’s clothing factory. But that conversion--one of 300 under way in the Soviet Union--was not the oddest thing going on that windy day in Kingisepp.

California Chutzpah

The real twist was the role of Wesley Bilson and Harold Willens, two self-described “card-carrying capitalists” from Southern California, embarked on a quest that seemed to combine quixotic idealism, careful calculation and more than a little chutzpah.

In an open letter to Soviet newspaper readers late last year, the wealthy entrepreneurs had offered Western-style consulting help, free of charge, to struggling consumer enterprises. Americans, they declared, have a vital self-interest in President Mikhail S. Gorbachev’s wish to steer his economy onto a more peaceful path.

“This historic economic restructuring can go a long way toward reducing--perhaps even eliminating--all possibility of military conflict between our two countries,” Willens predicted at the time.

Dramatic Response

The dramatic gesture paid off. Thousands of Soviets--from factory managers to physicians to ordinary citizens--poured out their wishes by the mail load. Totally outside the bounds of normal diplomacy, a citizens’ collaboration was forming.

And what a strange collaboration it was, drawing in an unlikely cast of characters ranging from veteran U.S. peace activists and retired industrialists to Soviet journalists and workers at a Moscow bra factory.

There was Sophia Lansky, a Soviet emigre and actress who had worked in Hollywood (once teaching “a French actor playing a Russian villain how to speak English with a Russian accent in a Rambo movie”), who was so moved by the effort that she signed on as project director and interpreter.

There was Harry Froehlich, 68, a third-generation brassiere manufacturer who lives in Pacific Palisades, recruited to help a Moscow factory. (“I said, ‘Moscow in January? You’ve got to be kidding,’ ” he recalled of his first meeting with Bilson. But days after his retirement, Froehlich was en route to the Soviet Union.)

And there was Ilya Baskin, the 32-year-old chief of Leningrad’s Garant cooperative (a Soviet-style private firm), who proved so enterprising and energetic about taking over the Kingisepp base that Willens dubbed him Horatio Algersky.

For the Americans, the mission would provide a rare close-up of the hard realities that make up of every day Soviet life--realities that even Yankee know-how would not be able to budge. For the Soviets, it promised an unexpected source of expertise--and hope--at a time when household shortages and economic malaise seemed stubborn as ever.

“I’m dealing with people that want that tube of toothpaste from me,” Bilson mused at one point. “They’re embarrassed, but they want it.”

By early 1989, Willens and Bilson had committed themselves to three projects: a Leningrad apparel cooperative that wished to take over the Kingisepp base, a brassiere manufacturer in Moscow and a clothing factory in Moldavia. Each faced the stifling edicts of bureaucrats in matters ranging from price tags to allowable materials to time for tasks on the factory floor.

Championed by Magazine

American enterprise would challenge Communist bureaucracy as never before. Editors from the influential Soviet weekly Arguments and Facts, sensing not just a good story but a chance to help Gorbachev by publicizing consumer gains, became champions of the capitalists’ effort.

In a series of trips, letters and telephone calls, the Americans personally lobbied Soviet bureaucrats to ease restrictions. They interviewed Soviet consumers and workers. And they linked Soviet managers and U.S. experts in relationships that continue today.

By early this year, the mission had been featured in Soviet newspapers, television and radio. Bilson’s name was familiar to many ordinary Muscovites (some even asked for his autograph).

Surprise Victories

And there were unplanned victories: Last month, the city of Odessa granted a local military base to a clothing cooperative that one of the Americans had visited.

While it’s hard to predict what the lasting benefits will be, on that spring day in Kingisepp near the Gulf of Finland, it became obvious that the unique effort had at least been noticed at the highest levels. In a message read by Arguments and Facts Editor Vladislav A. Starkov, Raisa Gorbachev sent her “warmest wishes.”

Could it really make a difference? Bilson, who has logged many thousands of miles and uncounted hours trying to ensure that the grass-roots effort will indeed succeed, concedes the answer is not yet in. “What we’re doing may be a drop in the bucket--or it may be extremely significant,” he said. “Nobody knows right now.”

The Beverly Hills Tennis Club might seem an odd place to worry about the future of the world. But for years, Willens has found it a convenient spot to do just that.

Members sometimes tease the Brentwood resident that he is the “man of La Mancha” because of his frequent tilting at the windmills of government policy. “What do you mean, ‘My country right or wrong?’ ” Willens likes to ask. “My job is to make my country right when its leaders are wrong.”

In the 1960s, he rallied business executives against the Vietnam War in a campaign that gained national attention. Later, he served as chairman of California’s nuclear freeze initiative, plotting tactics, recruiting a prestigious advisory panel and pressing friends to donate cash.

“All that, I conceptualized--then I broke my ass making it happen,” he recalled one morning over iced tea by the tennis club’s pool.

Born in Soviet Union

Willens was born in the Soviet Union; his family emigrated to New York when he was 8, after the Bolshevik Revolution.

But those memories have faded and he points elsewhere for clues to his obsessive campaign against the arms race: witnessing the devastation of Hiroshima and Nagasaki as a U.S. Marine intelligence officer, weeks after they were bombed in World War II.

Years later, after he had gotten rich through real estate and textile machinery ventures in Los Angeles, he vowed “to do anything I could to prevent what I saw as an increasingly inevitable (nuclear) threat to destroy everything I cared about, because of governmental stupidity.”

Today the Democratic peace activist is gray-haired, his sense of balance a tad shaky due to spinal problems, the daily tennis games a thing of the past. But he remains “nearly obsessed” with the nuclear arms race and other, less dramatic, threats to the environment.

Finds Ideal Partner

In that concern, the impatient, ever-pressing older man long ago found a complementary partner in Bilson, an upbeat Pacific Palisades resident who shares Willens’ intensely personal approach to world peace. Bilson, a Republican who gained wealth through hospital investments, has pressed tirelessly for the Soviet initiative, using his office as home base and taking three trips there so far this year.

Each uses terms from the business world in describing the current initiative: “If we’re going to have a global partnership, who should be the general partners but the Soviet Union and the United States?” the younger man asked recently.

For that matter--to borrow a phrase from Bilson--why leave it up to “the cowards in Washington?” Last summer, the two entrepreneurs decided not to wait.

At an informal meeting between Americans and Soviet officials at the Colorado home of “Megatrends” author John Naisbitt, they popped the question: What if two capitalists were to offer Soviet consumer enterprises consulting aid with no strings attached?

The free Western expertise, they maintained, might help a Soviet factory produce more plentiful, attractive products. And just maybe, the value of an “entrepreneurship-transfer” could be broader: With favorable publicity, public opinion might strengthen Gorbachev’s economic reforms.

And that, the Americans reflected, could enhance security for citizens of both countries. The Soviets, including members of the Communist Party Central Committee, were intrigued.

Stereotypical Businessman

“We have the stereotype of an American businessman who is very effective, very energetic, but whose only purpose is to make money--and the more the better,” noted Alexander Meshchersky, Arguments and Facts’ deputy editor-in-chief, in a telephone interview from Moscow.

So such cooperative behavior by American capitalists, he added in a refined, vaguely British accent, was “rather unexpected.”

In November, the Americans’ letter appeared in Arguments and Facts, a newspaper with a circulation of 20 million sympathetic to Gorbachev. The offer hit a nerve: The newspaper was deluged with more than 3,000 written pleas from all over the nation.

Readers asked for medical equipment, aid in building factories, even help in expanding an orphanage. Many of the writers wanted to meet the Americans.

Overwhelming Reaction

“The reaction surprised us--because it was overwhelming,” Meshchersky recalled.

Weeks after the letter appeared, Bilson visited the Soviet Union, hosted by the editors of Arguments and Facts and the influential Znaniye scholarly society. By the time he returned 11 days later, he had found the three potential showcases for U.S. help.

Baskin’s Garant cooperative in Leningrad--then awaiting a decision on whether it would get the army base--wished to send an employee to America to learn U.S. management techniques and also sought aid in getting equipment.

“The final goal is to increase the production of children’s clothing in the Soviet Union,” Baskin said recently in a telephone interview from his apartment in Leningrad.

Maker of Inferior Bras

An influential Soviet economist, Abel Aganbegyan, had pointed Bilson toward Moscow’s 2,000-employee Cheryomushki factory that made bras considered inferior by Soviet women. And in Moldavia, near the Romanian border, a clothing factory sought help in enhancing style and quality.

Could two unappointed citizen-diplomats from America make even a ripple in a system that seemed to squelch enterprise at every turn?

As Willens saw it, the problem would be tackled through leverage--a series of carefully conceived steps used for maximum effect with the help of Soviet publicity. Citizens of both superpowers, he believed, might finally see the crying need to work together. Inclined to jot down his thoughts, Willens wrote: “It is a moment in history when altruism and self-interest do intersect.”

But nobody promised it would be easy. Repeatedly, the bureaucracy stalled changes in factory practice the Americans advised, permission for Soviets to visit America, permission for Americans to visit the Soviet Union, even travel within the sprawling country.

On one occasion, a zealous customs agent in Moscow confiscated a fax machine that was in the Americans’ luggage, apparently uncertain of its use. Froehlich, who was carrying the machine, a gift for the editors of Arguments and Facts, was nonplussed: “How do you explain to a Russian customs agent that it’s a fax machine?”

Indeed, that task was beyond even the friendly Soviet newspaper editors who sported pins proclaiming, “We Wesley Bilson” and “Welcome Comrade Bilson.” Authorities held the fax hostage over the weekend.

Starting to Pay Off

But despite the nation’s rigid bureaucracy, America’s citizen-diplomats now claim that their flurry of visits, telephone calls and letters this year has begun to pay off.

Unlike the conversion of the military base outside Leningrad, for instance, the decision in Odessa--benefiting a cooperative that made children’s costumes--was totally unforeseen. Local officials in the city, which is Lansky’s hometown, made their decision after she had paid them a visit.

“It’s a continuation of what happened in Leningrad,” said Lansky, 34, a tall redhead who left Odessa for Israel in 1973. “Now, it’s like a wave. . . . I’m happy; I’m proud.”

Like others drawn to the Americans’ unusual quest, Lansky found a deeply personal meaning in the mission’s peaceful theme. Once, while she was performing for Israeli children in a bomb shelter near the Lebanese border, a Soviet-made missile exploded nearby.

“I had my personal confrontation with Soviet weapons,” she said. “I want to prevent it in the future.”

At the former military barracks in Kingisepp, plans for the layout of a large new factory have proceeded with advice from Froehlich.

Results Will Take Time

“It will take people a year or two to see how wonderful this initiative is,” Baskin said, “because they don’t see results yet. Nothing of this sort has ever been done.”

Similarly, the U.S. efforts have sparked a glimmer of progress for the Moscow bra factory, which had been forbidden to import fabrics. Froehlich--whose father and grandfather manufactured corsets in Germany and Switzerland--recalled that the coarse Soviet products “reminded me of the kinds of garments we made 50 years ago.”

Earlier this year, in a Western-style “focus group” with 17 female employees of Arguments and Facts, the consumer verdict was obvious: Each of the Soviet women acknowledged wearing a foreign brassiere. What’s more, “Only 50% of them believed the Moscow factory could produce a bra as good as the foreign ones,” Bilson said.

But after meeting with Bilson and an editor of Arguments and Facts, a Soviet bureaucrat cracked open a door: He agreed to let the Americans import enough quality fabric--at Soviet expense--for the factory to show what it’s capable of.

First Samples ‘Fabulous’

In late May, Froehlich inspected the first sample of the Soviet bras made with American fabrics. “I must tell you, they look fabulous,” he said excitedly.

The venture also has spawned promising new relationships between Americans and Soviets. To cite one: a proposed 2,000-square-foot retail clothing store in Leningrad to be set up with help from American students.

The experiment would be a sort of joint venture between the Fashion Institute of Design and Merchandising in Los Angeles and the Leningrad Textile Institute, which proposed such exchanges during one of the Americans’ trips.

“We’d like to see it (the store) open by early spring next year,” said Tonian Hohberg, president of the Los Angeles design school. “There’s no doubt in my mind that they’re very anxious to get it started.”

For all the excitement, it is not clear how far such efforts can ripple through a Soviet system that still discourages initiative and turns Western economics topsy-turvy.

“Maybe the people at Arguments and Facts, the brassiere factory, the people on the Western side all feel wonderful about what they do,” said Kent Osband, an economist at the RAND Corp. “But are they really getting at the essence of the system?”

Osband and a second Soviet specialist, however, agreed that some benefits might come of the novel effort, especially any transfer of entrepreneurial skills and attitudes.

“In particular, what I like is building up small enterprises or ones that can get out from under the state,” said Henry Rowen, a Stanford University specialist on the Soviet economy. “It’s what we should be favoring.”

For his part, Willens already describes the quest as a “teeny hunk of history,” based on gains so far and on the new U.S.-Soviet relationships that are blossoming.

Certainly, the adventure has captured the imagination of many Soviets, a point highlighted by the fax machine flap. As Bilson and Froehlich tell it, when told who owned the gadget, a stunned Soviet customs agent blurted out: “This machine belongs to Wesley Bilson? I wrote a letter to him.”