Russia in Search of Realism
Thank you, Howard. The National Conference on Soviet Jewry is an
organization that I have known and admired over many years, both inside
the government and out, and it's a pleasure to speak to you today.
I have always believed that those who, like the NCSJ, made human rights
a central issue of the Cold War played an enormous role in bringing it
to a successful conclusion. The principles that inspired you during
those years -- religious liberty, the rights of national minorities,
the importance of democratic institutions to protect these rights --
still guide American policy.
And of course they still guide the NCSJ. Looking around this room, I
see many people who were in Moscow in September at the time of the
Clinton-Yeltsin summit, for the dedication of the memorial synagogue at
Poklonnaya Gora.
As Dennis said, this was, for all who took part, an extraordinary,
moving event. It rewarded years of effort -- and of cooperation
between people in this room and in Russia. It was a symbol of how much
Russia has changed, of how much it has broken with the Soviet past.
Like the summit itself, this ceremony was all the more dramatic because
of the atmosphere of acute economic, political, social, even
psychological uncertainty in which it took place. I'm sure that those
of you were there remember this atmosphere well.
On September 1, the ruble was collapsing and with it Russia's banking
system. There was a widespread fear of complete economic meltdown.
President Yeltsin had just fired one prime minister, and his new
candidate for the job (or his old candidate, since it was Viktor
Chernomyrdin again) had just been voted down by the Duma.
Moscow was full of rumors about what would happen next -- about the
kind of government that would be formed, about the policies that it
would follow, about whether it would be able to restore economic
confidence and preserve social stability.
No one knew the answers to these questions, but there was one theme
that united every rumor I heard, every conversation I had with Russian
officials: Decisions about Russia's future had to be based on
"realism." There was no room for wishful thinking, for ideology, for
pretending that Russia could easily shake its historical and cultural
legacies. The only way to be realistic, everyone kept saying, was to
seek "Russian" solutions to Russian problems.
I've just returned from another trip to Moscow, and I want to talk
today about the choices that Russia faces and their implications -- for
Russia, for its neighbors, and, of course, for us. The word that one
hears most often in Moscow is still "realism," and yet along with it
there is a more sober discussion about how to define the term. Does it
mean Russia should give warmed-over, semi-Soviet policies another try
or that it must not? Does it mean Russia should seek to disengage from
the world or that it can't? Does it mean there is a "third way," a
"Russian way," or that there isn't?
This debate continues because Russia's problems continue, and they
continue to be dreadful. The passage of time and the approach of
winter make them worse. But if there's a change in the way these
problems are viewed, I'd put it this way: Where "realism" was just a
few weeks ago the slogan of those who'd like to dodge global realities,
now it's the tool of those who know it can't be done and shouldn't be
tried.
How Russia chooses between different kinds of "realism" will affect
the choices it makes on many issues that matter greatly to us. If what
I think of as a higher realism emerges, we will need to engage it, test
it, push it, strengthen it. Since the collapse of the Soviet Union,
our challenge has been to encourage Russia to make the right choices --
to see that openness and engagement are in Russia's own interest and
that the costs of turning from this path are too high.
The clash between "realisms" is most vivid on economic issues, so let
me start with these, before turning to foreign policy and other
questions.
Since August 17, when the Russian Government accepted devaluation of
the ruble and defaulted on some of its debts, all the economic policies
of the past 7 years have been held up for critical review. The crisis,
some said, showed that these policies were fundamentally flawed.
Clearly the state had to run most sectors of the economy again; it
should pay wages, pensions, and other arrears by printing money and
could do so with no risk of inflation; it had to curtail foreign
investment, reject foreign borrowing, and build Russia's economic
recovery on the country's own resources; it should protect the value of
the ruble by simply making the dollar illegal; and it should resume big
subsidies to industrial enterprises to get the fabled Soviet economic
machine whirring again.
This was what passed for realism in early September. To judge by what
my colleagues and I heard in Moscow 10 days ago, October's realism has
to meet a higher standard, not least because all this loose talk was
beginning to have predictable Soviet-style results: hoarding, bare
shelves, bank runs, black markets.
On many of the issues I just mentioned, Russian officials now take a
different tack. They say they recognize that inflation would have
devastating social and economic consequences; they stress their
interest in negotiating with the IMF and World Bank to work out new
loans; they reiterate that Russia will meet its sovereign debt
obligations; they float trial balloons about how to get Western banks
to come in and revive Russian banks; and they acknowledge that the
energy sector, which ought to be the strong suit of any recovery
strategy, desperately needs foreign investment.
Now, what should we make of this sober new talk? In September, when we
asked Russian officials whether they intended to act on the strange,
pseudo-realistic things they were saying, their (sometimes sheepish)
answer was: Watch what we do, not what we say. Now that a higher
realism is in vogue, we should follow the same advice.
After all, recognizing that hyper-inflation would be a calamity for
Russia is not the same thing as putting in place the fiscal and
monetary policies that will prevent it. And recognizing how much
foreign investment can contribute to Russian growth is not the same
thing as creating the climate in which it actually takes place.
Today the Russian Government faces a daunting set of tasks: cutting its
budget deficit, stabilizing the ruble, devising a non-inflationary
monetary policy, rehabilitating the banking system, reaching agreement
with private creditors on state and commercial debt, and laying the
foundations for growth.
If the government approaches these choices seriously, if its arithmetic
makes sense, we'll be able to help. If the numbers don't add up, our
help won't do any good. This is the position that President Clinton
laid out in Moscow in both his private meetings and his public
statements. It was also the bottom line of Secretary Albright's
speech in Chicago earlier this month. And I think it's fair to say
that international financial institutions and international investors
will take the same approach.
The next couple of months are the time to show -- through practical
choices -- that the higher realism will in fact shape Russian policy.
Let me note two areas where there are opportunities to make this
realism a reality.
Prime Minister Primakov has got the attention of Western bankers with
what he has said about opening up the Russian market to them. But the
interest they show will depend on how his government reorganizes
current banks, deals with their discredited management, and handles the
restructuring of existing debt, a matter that has been up in the air
since the middle of August.
Similarly, Western energy companies have been encouraged by signs that
the Duma is ready to pass enabling legislation on production sharing
agreements. But there won't be any new investment if the legislation
passes with provisions which are now in it that increase the risk of
nationalization and eliminate a Western company's right to
international arbitration.
In looking at Russia's economic choices, I have sketched a clash
between different kinds of self-proclaimed "realism" -- between one
realism that isolates Russia from the world economy and another that
reaps the benefits of integration.
Russia faces parallel choices in its foreign policy as well. On the
one hand, there is the "realism" of going it alone, of asserting a
fundamental mismatch between Russian and American interests, of backing
anyone who has a beef against the United States -- the better to
promote what some Russians call a "multi-polar" world.
On the other hand, there is the "realism" that sees a series of
challenges to Russian security that can most effectively -- perhaps
only -- be addressed through broad-based cooperative international
efforts, especially with the United States.
As Secretary Albright pointed out in her Chicago speech, no one can
seriously think that Russia's need for a successful non-proliferation
regime is less acute than our own, or that Russia can more easily
afford to maintain strategic nuclear arsenals at today's levels than we
can, or that war in the Balkans poses less danger for Russia than for
us.
Over the long run, we can expect this "higher realism" to be the basis
of Russian foreign policy only if it convincingly serves Russian
interests. Our judgment is that it does, but it won't be our judgment
that counts. Russians themselves have to be satisfied with the choice,
and on many issues they are divided.
Take the case of Kosovo. In the last 2 months, we have worked
extremely closely with the Russian Government on this problem and
succeeded in bringing Milosevic to accept terms that he would never
have agreed to had we not been united.
Yet there is no denying that in much of Russian domestic debate -- and
even in some official statements -- this cooperation is considered a
success only because NATO has not used force. The fact that we have
gotten Milosevic to change course is actually resented. So far, the
higher realism has guided Russian policy, and the result has been real
Russian-American cooperation. But it has not guided Russian opinion,
and this means that Russian-American cooperation will remain a target
of criticism.
A similar duality has shadowed the ratification of START II. I know of
no Russian official who questions the importance of this treaty for
Russian security policy. The military support it -- not reluctantly,
but with powerful arguments about its advantages for Russia.
What blocks ratification, I have concluded, is not an alternative
strategic judgment, but a gut-level resistance among some parliamentary
deputies to anything that the United States has promoted as actively as
we have promoted START II. We have done what we can on this subject;
we can't do more until Russia makes its choice.
Perhaps the toughest issue we have worked on with the Russians, where
we see the mix of motives at its most frustratingly complex, is Iran.
It is official Russian policy to seek good relations with Iran -- if
only to blunt the threat that so many Russians see in Islamic
fundamentalism. In Western diplomatic parlance, this strategy of
cozying up to potential enemies has a name -- it's called appeasement.
Needless to say, this strategy also provides excellent cover for anyone
who views Iran as a lucrative market for sensitive military
technologies. And it provides a cover for a very aggressive Iranian
effort to acquire such technologies.
We have been completely candid with the Russians about our view of
Iran, but we have not expected to be able to persuade them to adopt our
policy on Iran in every particular. We have not really tried to do so.
We have tried, instead, to build on a higher realism -- on a
recognition of the threat that the flow of technology to Iran's nuclear
and ballistic missile programs poses to Russia itself -- and to
Russian-American cooperation. We have pushed hard for action against
specific entities that we had reason to believe were engaged in such
transfers. We have pushed hard for a broad upgrading of Russia's
export controls. We have stopped American contact with and access to
American markets by Russian companies that we -- and the Russian
Government -- have identified as part of the problem. And we have made
clear that an expansion of Russian-American peaceful space-launch
cooperation hangs in the balance.
The result has been progress but far from enough to solve the problem.
That's why we have put this issue front and center in our discussions
with the Russian Government. Whether it's in Bob Gallucci's meetings
in Moscow this week, in the Vice President's communications with Prime
Minister Primakov, or the President's own meetings, we want to be sure
that on the Russian side this problem gets the direction from the top
that it urgently needs.
When we examine Russian foreign policy, we can't, of course, look only
at Russian-American relations. I leave tomorrow for a trip that will
take me to Ukraine, Georgia, and central Asia, and at every stop I know
I'll hear expressions of worry about how Russia's crisis will affect
its neighbors.
The crisis has already been particularly hard on those countries that
count on Russia as an export market -- and there are some former Soviet
states that sell more than half of their exports to Russia. The impact
doesn't stop there. Anyone who is no longer making money by exporting
to Russia will also find it harder to pay for energy imports from
Russia -- and some former Soviet states depend on Russia for all the
energy they use.
These hard facts are leading many of Russia's neighbors to try to
accelerate their integration into the international economy. Moldova
is already working hard to diversify its export markets. Ukraine is
working to diversify its sources of energy.
Those countries such as Azerbaijan and Turkmenistan that are themselves
important energy exporters are still less interested in relying only on
Russia to move their oil and gas to world markets. This fall,
Kyrgyzstan becomes the first state of the former U.S.S.R. to join the
World Trade Organization; Georgia and Armenia are going to be even more
determined to be second.
The policy of the United States toward all these efforts is clear: We
support them. But what will Russian policy be? Let me express a hope:
Nothing would better serve long-term Russian interests in this area
than a dose of the higher realism. The principle is a simple one:
Stable, confident neighbors with growing economies can contribute to
growth in Russia itself.
Let me close my remarks by looking at choices that Russia is making in
one more area -- the policies and protections that determine the growth
(and health) of civil society. Free speech and free media, freedom of
assembly and religion -- these are really the ultimate barometer of the
kind of country that Russia will be in the next century.
Right now the barometric reading is a good one. Russia in the 1990s is
freer than ever before in its history, and its freedoms rest on better
constitutional foundations. They will, of course, be challenged from
time to time, as they are in any country. The real question is how the
challenges are met.
Last year's law on religion was one such challenge. Yet the Russian
Government's implementation of the law has so far largely vindicated
its claim that it would not allow religious liberty to be abridged.
Right now we are seeing a comparable test of free speech in the trial
of Aleksandr Nikitin.
I think it's right to consider recent episodes of anti-Semitism in
Russia to be a similar challenge: the bombing of the Marina Roshcha
synagogue in Moscow, the vandalizing of the Jewish cemetery in Irkutsk,
the appalling public statements of Governor Kondratenko. These have
called for a rapid response by Russia's leaders, and by and large they
have provided it. President Yeltsin in particular led the moral
opprobrium when he said, "Those who are raving about national
superiority and anti-Semitism should ask themselves: Do they understand
what they are doing, is it possible that Russians will allow the most
terrible ideology ever known by mankind to strike root in our land?"
Public statements of this kind are vital if Jewish life is to continue
to flourish in Russia.
But they are vital for another reason as well. In my job at the State
Department, I often have occasion to discuss questions of
democratization and human rights with senior figures in all the states
of the former Soviet Union. I express our commitment to these goals
and observe that over the long-term our relations with these countries
will be crucially affected by how much progress they make in reaching
them. And I often hear a response very much like this: Yes, these
things are important, but don't think they are important because the
United States has asked us to be concerned about them. They are
important because our future depends on them.
Those who don't mean this answer seriously -- and there are altogether
too many of them -- are, of course, simply getting me off their back.
But those who do mean it -- and they are not as rare as you might think
-- express what I have called a higher realism. More than they know,
their future does depend on it. As we look at Russia and the post-
Soviet world, the strength of this kind of realism is our best reason
for hope.
Thank you.
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