#6017
#12
Date: Thu, 10 Jan 2002 18:22:22 +0100 (MET)
From: Heinrich Vogel <Vogel.heinrich@gmx.de>
Subject: Contribution
Dear David:
the enclosed contribution to a American/German workshop organized by the American Institute for Advanced German Studies may be of interest to some of your readers.
Heinrich Vogel
Heinrich Vogel
Stiftung Wissenschaft und Politik, Berlin
US/German Engagement of Russia in the 90s:
To what extent did we achieve our goals?
Remarks for a Workshop organized by the American Institute for Contemporary
German Studies,
Washington, December 10, 2001
For looking back to ten years of transition in Russia the benchmark is critical. I pro-pose a comparison with Poland, a formerly communist country, too, which has doubtlessly performed well: Today it's economy is thriving, it's administrative and technical infrastruc-ture is being brought up to date, and it's multiparty parliamentary system is comparable to that of any other Western democracy. Changes of power in Poland went along with an im-maculate record of bipartisan European orientation, making this country a foremost candi-date for full EU-membership in relatively short time.
The Russian record is by far not as impressive but, given the handicaps of dis-economies of scale and history, it deserves respect: Major violent turbulences have been avoided, the CPR has been tamed to a new attitude playing according to constitutional rules, the country has not fallen apart but, after some times of trouble, is now again run from Moscow (on a macro level, that is). The economy is monetized and linked to the global economy. Last but not least: The present administration has eventually come down to a pragmatic foreign policy, acknowledging the limitations to a restoration of great power status for Russia, and cooperating in the fight against terrorism as well as in the manage-ment of world energy prices.
On the other hand, the much advertised "coming boom" which Western economists had expected to heal the wounds of unavoidable recession has still not arrived. Recent eco-nomic growth is the result at least as much of global windfalls as of overdue reform efforts. In the meantime, Russia's material and social infrastructure is in shambles, and the capital gap of investment missing over the last fifteen years cannot be restored in a quick fix. As huge payments for external debts of the country come due in 2003, the state-budget will not cover necessary expenses for a broad range of issues, from military reform to reorganiza-tion of the utility or the health system.
Our achievements: Too little, too late?
The change in the presidency in 2001 implied no real change of power. Political stabilization came as the result of manipulation, arm-twisting, and intimidation, hardly in line with the constitution. The result is a hybrid state of affairs: Longer-term chances for the institutionalization of democracy are overshadowed by short-term risks of insufficient eco-nomic growth, infrastructural decay, continued net-exports of capital, flourishing corrup-tion, and lack of political transparency.
The truly strategic goal of engaging Russia, even more important than getting con-cessions on conventional security arrangements like NATO-enlargement or arms reduction, was to channel systemic change towards democracy and market economy. After ten years we had indeed hoped to see at least the foundations lain for the rule of law, for a fair politi-cal process, for institutional stability, and a general reorientation towards Western values. This, however, has not been achieved. Instead, there are all kinds of historical, sociological and political explanations, excuses, even justifications for the present illiberal democracy, a system of checks without real balances, camouflaged in procedural formalism, run by the will of the ruling clan rather than according to laws, by intervention of the Kremlin rather than through functioning institutions. Sure, it might have come worse - Russia is not Poland, it always was different. And why ask for more as long as the present system works, and as long as we have a more predictable partner in the dialogue on international security?
I have a hunch that Western politics could have achieved more than a relationship with Russia which now depends primarily on the projection of hopes in a new leader. Not that we ever had been in control of the core process which propelled Russia towards the state of affairs it has now reached. But I believe that it might have made a difference if Western politicians had not cuddled up to crooks, praising the organizers of inside-privatization as bold reformers, if Western banks had refused to profit from elaborate Russian schemes of money laundering, if Western businesses had refused to play the game of kryshka and corruption, and if Western op-ed writers had not confused elections with democracy, Moscow with Russia, and the manipulation of portfolios with real growth.
Many Western evaluations take a pretty hypocritical approach, claiming success to their brilliant advice and blaming the Commies and bureaucrats for all that went wrong. Janine Wedel's approach of "Collision and Collusion" which nails down well placed insid-ers in Russia and in the US and Stephen Cohen's generalizing J'Accuse are too narrow, bordering too closely on conspiracy-theorizing, to be taken as guidelines for understanding the reasons. Nevertheless, more might have been achieved over the last ten years, had Western policies set their priorities in a different way. Not only did we underestimate the time needed to undo the networks, not to mention change the mental maps of Soviet elites who seized the opportunity of a rebound for themselves and cared so little about legitimacy and responsibility.
My main argument is that the typical Western ideology of the early 90s with its sus-picion against anything related to the public sector ignored the importance of the visible hand of the state. To put it in a nutshell: The philosophy of Western assistance in the 90's favored the training of managers and bankers over that of judges and administrators. Future studies of Western aid and advice will provide ample evidence of this neo-liberal bias. I submit that the side-effects of transformation would have been less painful and that Western credibility among a broader public in Russia would have suffered definitely less than it has since 1998 due to a myopic fixation on getting the market into full swing.
The social costs of transformation in Russia would have exceeded those in Poland, but the destruction of savings capital in 1998 with all the collateral damage for domestic and foreign politics in Russia was avoidable, if a stricter regime of transparency had been applied and enforced by the IMF from the outset. Moreover, it would be naive to assume that the transfer of colossal Russian capital to offshore accounts had been possible without the collusion of the majority of actors in Western (i.e. not only Swiss or American) financial markets, tempted by the promise of fast and vast profits.
I also claim that the disastrous trend in Russian demographic data might have bot-tomed out earlier, if Russian politicians had been publicly held responsible for the ailing health system, if a large-scale Western program had been launched in time to sustain mini-mal levels of services and supplies in this sector.
While holding on to the facade of friendly relations with a Russia represented by Boris Yelcin the leaders the G7 had to share the embarrassment of facing Western public opinion, which criticized Russian offenses against basic human and civil rights. But none of the obvious scandals (military interventions in Chechnya or the involvement of key Kremlin staff in large-scale money-laundering) was big enough not to be hushed up in the wake of feel-good events of "Bill and Helmut meeting Boris". What went wrong was forgiven as long as the communists were kept at arms-length. Transforming Russia was a matter of generations anyway, wasn't it?
Different interests, different styles
On a general level, US and German/European goals in promoting Russian reforms have been identical: Starting from the paradigm of "democratic peace", we wanted to help establish a democratic and market-based system and to secure full cooperation of post-communist Russia in all issues of international security. But the ritual invocation of "West-ern democracy and market economy" has been papering over differences which were not insignificant when it came to defining a model for Russia. While these differences remained in the shadow of pompous G7 declarations, the underlying competition of legal and economic systems (US versus EU/Germany) and the context of jockeying for leading posi-tions in the run for market-shares was only too obvious. Accordingly, the technical advice rendered in bilateral programs of support for Russian "reforms" (e.g. accounting procedures and standards of transparency) differed. Too many Russian partners took advantage from this competitive bidding: Much less interested in optimizing the model or accelerating transformation they gained time for their game, maximizing profits for their respective clans.
"Natural" differences between the American and the European/German agenda are not confined to the dissent about US policies of abrogating the ABM-treaty and launching a missile defense-program. Less visible are the discussions about the role of the United Na-tions or relations with Iran where Europeans have been closer to Russian positions before long. US relations with Russia have been dominated by the agenda of former great power-rivalry: Nuclear disarmament, proliferation, and geo-political gambits around Caspian oil, and there was a prominent position for American negotiators in the Paris Club.
The German agenda in dealing with Russia has been confined to European security, economic and technical assistance on all levels of cooperation and, most prominently, debt management. It was the specific exposure of Germany to Russian technical default and re-lated issues of debt rescheduling which in 2000 caused a German Deputy Secretary of Finance for the first time to challenge Russia's participation in the G7. It was this step (feared by many to embarrass the Russian side too much) which had a sobering impact on those in Moscow who toyed with the idea of not paying their dues to the Paris Club and contributed to a more realistic perception in the Kremlin of Russia's short-term options.
There was and still is a distinct difference in the American and German rhetoric of discussing Russian developments: "Who lost Russia?" was more than just the typical hype formulation of an artificial campaign issue; it reflected the self-image of American omnipotence in the 90s shared by a vast majority of American political elites. Such a slogan never would have reached headlines in the German press, not even in times of election. The logical response of patriots and even frustrated democrats in Russia was the blame of malpractice under the cover of the Washington Consensus, if not conspiracy against a recovery of Russian great power status. These allegations surely were blown out of dimension - but there can be little doubt that the crisis of 1998 inflicted more damage to the American image than to that of Russia's European partners, certainly of Germany. This leaves Germany in a good position to maintain some influence in Russian politics, not despite, but due to the use of open words about deficits of Russian economic and political reforms and unaccept-able behavior in Chechnya.
Conclusions
Despite a long agenda of unresolved issues in Russia's development, most Western politicians today share a non-committal position of "So what?": As long as the Putin-system works, as long as we have a more predictable partner for economic cooperation, for the dialogue on international security, and for the fight against terror, we are on the safe side.
But how certain are we? Putin is the first rational actor (i.e. pragmatic and rational in a post-communist logic) to preside over Russia since more than 10 years and neither his strategic nor his tactical approach to relations with the West after September 11 should be undervalued. He did not sacrifice one inch of Russian interests when he joined the alliance against terror and refused to go along with OPEC oil-price strategies; Russia can step back from each of these current positions, and Putin (as well as his successor) has options for competitive bids on a broad scale of global issues.
To be sure, the new agenda of Russian foreign and security politics abandoning former great power territory is of a tall order. The American abrogation of the ABM-Treaty, uncertainties about the implementation of treaties on biological and chemical weapons, accession of Baltic states to NATO, and Western pressure to show restraint in relations with Iran/Irak are hard to digest. Cooperative policies of Putin need good example and positive feedback. Not to care for possible internal repercussions of US/Western actions on the correlation of forces in Moscow may well jeopardize the strategy of a pretty lonely president in Moscow who seems to be prepared to open his country for Western standards and goals.
Not a short-term compensation for the Kremlin's joining the anti-terrorist coalition is at stake at this junction but the strategic goal of stabilizing developments which, in the longer run, might lead towards a more democratic Russia. If President Putin has the ambi-tion to modernize Russia according to Western standards he needs more than the current back-slapping. The anti-terrorist coalition is not the kind of solid ground on which to build a new relationship; there is no generally accepted definition of terror and, more important, Russia's political elites are far from standing united behind their president.
The agenda of engaging Russia has not changed, neither have basic difficulties gone away. This means that a consistent line of argument in support of the overdue structural re-forms in Russia will have to maintained, but also that standards of economic cooperation and political support must not be compromised. Neither a premature accession of Russia to WTO (as announced by Zoellick) nor "a changed view" of the situation in Chechnya (as suggested by the German Chancellor) should be acceptable. On the other hand, a consistent revision of Western policies implies that legitimate Russian security and economic inter-ests, not least in Central Asia, are taken into account in the frameworks of the United Nations. Europe has less problems with a truly multilateral approach to these issues than the United States.
Russia deserves a carefully calibrated upgrade in its role as a partner of NATO, but the consensus about an enhanced Russia-NATO Council takes suspiciously long. Moreover, the obvious idea of sharing experience in some missile defence-projects with the Russians remains off-limits, almost considered as an invitation to treason. This is clear evi-dence of the need for new substance in the debate on "engaging Russia" which in recent years has been degenerating into a mere ritual. The ball is on the side of US-policy-makers.
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