Russia is clearly testing the NATO alliance with its drone attacks in Poland and on the border of Romania. Russia is pursuing interests that run directly counter to those of the United States, the NATO alliance, Ukraine and a liberal world order.
Russia has reverted to authoritarianism, this time with an autocracy that resembles a criminal syndicate. How did it get there and what does it mean for the U.S. and Europe?
There was a brief moment in the 1990s when it appeared that Russia was heading toward a European-style democracy. Having been involved in the efforts to bring democracy to Russia back then, I have long pondered what went wrong.
Why did the Russia of Boris Yeltsin and liberal reformers fail and get replaced by Vladimir Putin and his KGB brethren? What role did the U.S. and other Western governments play?
I recently met a former U.S. diplomat who served two tours in Moscow who, in 1994, wrote a long “dissent channel” message raising questions about the approach our government was taking. Wayne Merry’s message was declassified some six months ago and published by the National Security Archive.
Merry argued that Russia was institutionally ill equipped to undertake radical reform of its “statist” economy. He predicted that the popular backlash would undermine Yeltsin’s government and seriously harm future U.S.-Russian relations.
Given the collapse of the Soviet economy, the Russian transition was always going to be chaotic.
However, Merry’s critique was that the U.S. policy emphasis on market reforms rather than building democratic institutions first represented an “especially virulent case of Washington institutions trying to ram a foreign square peg into an American round hole.”
It was clear in 1994 that the Russian people were looking for scapegoats. The reformers, aided by advisors from the U.S., were dealing with a Soviet economy that had collapsed well before Yeltsin and his reform-minded government took office.
The statist approach to economics and its inherent distortions had left Russia bankrupt. The only remedy that might have been less painful for the ordinary Russian would have been a massive infusion of resources comparable to the Marshall Plan after World War II.
The massive cost Germany has expended over two decades to absorb East Germany is another analogue. However, there was no possibility that the U.S. or Europe was prepared to commit a similar level of resources.What might the United States have done differently?
The U.S. Agency for International Development mission director in Moscow in 1991, Jim Norris, argued for a strategic plan that would set priorities and identify the Russian reformers who most needed resources and technical support.
A key part of the plan was to help the reformers build the democratic institutions needed to support a market economy.
The State Department coordinator had the policy lead. Believing that Russia was already a developed society, he opposed creating a plan. With the support of the Treasury Department, he wanted to emphasize trade and investment. He told Congress that we would soon be out of Russia.
Norris, a superb economist, argued that Russia “had few of the legal structures and institutions necessary for normal trade and investment relations.” This would take time.
USAID lost that argument and the Russian aid program became a Washington free for all with just about every U.S. government department bidding to participate.
It was an effort that lacked definition and, as Merry observed, too often ignored local context. Significant efforts were made to respond to the needs of the reformers, but the overall effort lacked a strategic framework.
Merry’s message was prescient. In 1995, Yeltsin faced an election when his poll numbers were in the teens. He felt forced to abandon his reforms.
He succumbed to pressure and his government, ignoring external advice, created a loan for shares plan that enabled the managers of state-run enterprises to acquire huge quantities of stock certificates. The oligarchy, born earlier, reached maturity.
1995 was also the year Putin moved from St. Petersburg to Moscow. He would soon become director of the Federal Security Service, the successor to the KGB. He became Yeltsin’s prime minister in 1998, and succeeded Yeltsin as president in 1999.
The stage was set. Putin made the growing regime and the instruments of government his own.
There is always a tendency to self-flagellate when considering these historic epochs. Certainly our government made mistakes. We could have invested more, but more resources was never an option. We could have been more strategic, more focused, more aware of the local context.
But, in the end, we didn’t lose Russia — Russia lost Russia.
We could end this by saying “the rest is history.” However, there is still history to be made.
The stakes are high, and the Merrys and Norrises, the knowledgeable professionals of the State Department and USAID, no longer have a voice in the Trump administration.
The fate of Ukraine and the history of Europe could well be decided by two very fallible men.
J. Brian Atwood is a senior fellow at Brown University’s Watson School of International and Public Affairs. He served as an undersecretary of State and administrator of USAID in the Clinton administration.