Luminous novel based on Pasternak; The Nobel Prize, by Yuri Krotkov. Translated by Linda Aldwinckle. New York: Simon & Schuster. $12.95.

At one point in "The Nobel Prize," Nikita Khrushchev remarks that in Soviet life "Everythingm is politics." How the political realities of the Soviet Union permeate the private, personal lives of his protagonists is the subject of this newest novel by Yuri Krotkov, whose 1979 novel, "The Red Monarch," based on Stalin's life, received considerable notice.

Political conflicts and dilemmas lie beneath this story, a fictionalized account of the award of the Nobel Prize to Boris Pasternak, both for "Dr. Zhivago" and for his poetry.

Krotkov, himself, who grew up in Soviet Georgia, reportedly became something of a literary light in Moscow 30 years ago, writing drama, interviews, reportage , and screenplays. His father, a cartoonist and painter, is said to have been a friend of Pasternak, their relationship giving Krotkov access to the poet's household for several years. In 1963 Krotkov defected to the West. He lives in southern California.

In Krotkov's plausible retelling, Pasternak's award results in agitation among the Soviet chieftains because his ideals are completely at variance with Soviet dogma. Whether or not Pasternak will accept the award and the reasons behind his decision constitute the novel's main action.

Interwoven with this crucial decision are Pasternak's conflict with Khrushchev, a disheartening summons by the Writers' Union, a re-evaluation of Pasternak's lifelong friendship with Soviet writer Konstantin Fedin, and the painful tale of Pasternak's love for two women: his wife, Zina, and his longtime mistress, Olga.

Important issues are debated by characters throughout the book. These include the dichotomy between freedom in the West and the crushing power of money, the notion that technology enslaves the individual, the pros and cons of capitalism vs. collectivism, the implications of the old generation giving way to the new, and, most important, the idea that in Soviet society, the individual is forced to compromise his or her integrity and beliefs to survive.

But "The Nobel Prize" is not simply a series of two-dimensional characters arguing pat ideological questions. Perhaps the most laudable quality in this excellent novel is Krotkov's ability to make his literary and historical figures human. Fedin, often portrayed as a literary mouthpiece for the party, is shown as having doubts about his convictions. At one point the writer wonders: "But had this commitment now become something of a burden? Had he lost the right to have any thoughts that differed, however slightly, from the ideology he had chosen to support?" At the novel's conclusion Fedin is faced with a difficult decision, one in which he must finally decide whether his personal loyalties will be subservient to what is politically expedient.

Similarly, Nikita Khrushchev, party head, is depicted as a thinking man, a leader with a conscience. Obsessed with dissociating himself from Stalin and a legacy of terror, Khrushchev discovers he is enslaved by his very position. Pasternak's award forces Khrushchev to face crucial issues, and the final picture of the leader is of a man helplessly trapped by his own human frailties and weaknesses.

Pasternak himself, labeled a "salon poet" and a "Narcissus" by the Soviet press because of his "coldness to social issues" and philosophy of individualism , emerges as a heroic figure, yet completely human -- a man continually grappling with "unanswerable questions," struggling to express his feelings about life in his art, while never ceasing to condemn himself for his "irredeemable sins."

"The Nobel Prize" is, finally, about a very human Russia -- "Russia, . . . incomparable mother, famed far and wide, martyred, stubborn, extravagant, crazy, irresponsible, adored, Russia with her eternally splendid, disastrous and unpredictable gestures." For however much the political realities of the Soviet Union may oppress (Pasternak tells his son, Lyonya, "I am against the Soviet system because it is inhumanm "), the tie to the rodina,m or motherland, ultimately emerges in this novel as stronger than all else.

Yuri Krotkov, through his masterful characterizations of Boris Pasternak and the other figures in the novel, Soviet officials and citizens alike, leaves us with an irreconcilable vision of two worlds, both flawed. Close to death, Pasternak confides to his lifelong friend Nina Tabidze, wife of executed Georgian poet Titsian Tabidze: "All the same, Nina, it seems to me there would be work, plenty of work for Christ in both communist and capitalist societies. Therem and here.m In both worlds. Yes, the world has been divided in two. . . . There are two worlds, Nina, theirs and ours. I feel suspended between them, as if I had cast off from both. That's probably the most tragic situation for an individual -- to be in between. Two irreconcilable worlds."

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