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photo of thomas grahamthomas graham


He was Chief Political Analyst at the U.S. Embassy in Moscow from 1994-1997.
Would you describe the beginning of the relationship between Yeltsin and Clinton?

The administration came into office with the intention of making Russia a top foreign policy priority. President Clinton's major address on foreign affairs, given at the Naval Academy, was devoted to Russia and our policy towards Russia.

This was done a few weeks before the Vancouver summit. Yeltsin made a very good impression on President Clinton at that point, and it's easy to see why. In a sense, they are similar types of politicians. They're both fairly big men who like the handshaking, the backslapping. Both of these men found themselves in the positions they did against great skepticism that they would ever achieve those levels within their own societies. So a certain sort of camaraderie developed between the two presidents at Vancouver, which carried through much of Yeltsin's term as Russia's president.

After the Vancouver summit, the word at the time was that Clinton had gotten out in front of the Russia policy.

It accelerated the type of relationship that we saw developing with Russia at that point. Everybody who dealt with Russia policy at that point realized that the transformation of Russia should be a long process. Russia had a difficult history. You don't flip switches and turn countries from totalitarian Soviet societies into western liberal democracies overnight

In fact, President Clinton had made that very point in his speech before the Vancouver summit. The relationship between the two men was sufficiently good that our president wanted to do more to help Yeltsin. In a sense, this pushed the bureaucracy to be more forthcoming in assistance for Russia, and in thinking about ways in which we can move the process forward.

But it also created a political context in which we had to demonstrate success. We had to demonstrate to the president of the United States that we were, in fact, carrying out his wishes, that this policy was successful, and that the direction he was giving to policy was being accepted and used as guidance by the bureaucracy as a whole.

When there were bumps in the road, did you sometimes still have to say that it was a success?

Domestically, there was a difficult political situation in this country, and this was something that any administration faces. There's a great deal of skepticism within the American body politic--certainly about foreign assistance--about how much you should do abroad, particularly given some of the domestic problems that we had at that point.

We were still coming out of a minor recession. We didn't have eight or nine years of economic expansion at that point. So there's always a tendency on the administration's part to make exaggerated claims for what their policy can achieve and how successful it has been, in order to persuade a somewhat skeptical Congress that indeed these programs should be supported.

Now, clearly, when there are bumps along the way, anybody in a similar situation is going to try to minimize those bumps and look at the good side. The problem for the administration began to develop largely after 1996, when the bumps became more frequent.

In other words, we would cheerlead for Yeltsin even when there was nothing to be cheering about?

In a sense, we were cheerleading for Yeltsin and the reformers. Remember, the Clinton administration didn't come into office talking about "a strategic partnership with Russia." The phrase was "a strategic partnership with Russian reform."

In a sense, we had already picked out the good guys and the bad guys in this process. It wasn't so much cheerleading, although there was an element of that. Remember, we were working with these people at the same time. The whole policy was conceived, in one aspect, as a mutual effort aimed at the domestic transformation of Russia, both politically and economically.

You were in Washington during the political crisis in Moscow in September-October, 1993. What was the view from here?

We saw the struggle in Russia largely in terms of good reformers against bad Communists and nationalists. This view was fairly well supported across the political spectrum in Washington. There weren't a lot of dissenting voices, either in or outside government. Certainly the press saw it this way as well, and intended to report it in that fashion.

This was  a process where we didn't ask a lot of questions about what had happened.  We were always looking forward, in part because there wasn't a lot of time for introspection... It was also clear to us in Washington that there were fatal flaws in the Russian constitutional system. Those flaws inevitably pitted the president against the Congress of People's Deputies, both of which could be interpreted at that time as having supreme power in Russia under the Russian constitution.

It was clear that it was going to come to a head. The administration and others certainly thought that Yeltsin's victory in the April referendum that year demonstrated that he had popular backing and, therefore, had a popular and democratic legitimacy that the Congress of People's Deputies did not have at that point.

As this moved towards a crisis in September, it was clear that the U.S. administration's weight of opinion was with Yeltsin, and that they understood that Yeltsin's move to illegally disband the Congress of People's Deputies was unconstitutional. But we didn't see another way out of the deadlock.

Now, at that point, we had no way of knowing that this would lead to a violent shootout in Moscow in October. But certainly we were supportive of Yeltsin, because we thought this was the only way to break the deadlock.

Even at that time, there were some dissenting voices. But the dissent was more about methods--this should be resolved peaceably, that one should encourage negotiations between Yeltsin and the Congress of People's Deputies.

. . . From our standpoint, it was fortunate that, when the violence did erupt, it was fairly clear that the people who claimed to support the Russian Congress of People's Deputies took the initiative, and Yeltsin was largely responding to that.

You told me that, after he fired the Parliament, there was some feeling of relief, that we in the United States thought this meant that the opposition was taken care of.

There was relief in the United States, but there was also a lot of relief in Russia at that time. Many of our contacts in Russia believed that this disbanded institution had been taken over by extremely retrograde communist elements, in some sense, fascist elements, ultra-nationalist elements.

The assumption was certainly based on what we knew about how the Russian population had voted in April--that, in the absence of the Congress of People's Deputies, absent a vigorous Communist Party, the elections would be won by the so-called reformers. And certainly that was the view within the reformist circles in Moscow and farther afield in Russia as well.

Was there any sense that the vote might turn against these so-called reformers and against Yeltsin's team?

No really serious consideration was given to that. We were surprised, as were most people in Moscow on the day after the vote, when the vote counts started coming in, and it was clear that Zhirinovsky's liberal democratic party had won. It had done extremely well in Russia's Far East, and these results weren't changing as the tally moved closer to Moscow. This came as a shock to almost everyone who was watching it.

What was our reaction?

Strobe Talbott got off a plane in Moscow and said something to the effect that Russia needed more therapy and less shock. That was at least a suggestion that perhaps the economic programs that Russian reformers had been pursuing with our backing and at our urging had not done what they were supposed to in Russia--that more attention should be given to the quality of life of average Russian citizens.

That was a short-lasting view, in part because the administration quickly came to the view that the Yeltsin administration did--that the Communists had not disappeared, that the ultra-nationalists were a problem, and that we were back into the pre-October violence of 1993.

It was a struggle of reformers on one side, and retrograde Communists and nationalists on the other side, who had a large, if not dominant position in the newly elected state Duma.

Do you think that that analysis was oversimplified?

That analysis was almost certainly oversimplified. And, again, there are a number of factors working here. One is our domestic situation, where you have to be able to explain what's happening in a very complex political environment in a way that we think the American people will understand and that, quite frankly, the U.S. Congress would understand. Breaking it down into a sort of distorted type of two-party system was something that everyone felt comfortable with at that point, although it was clear that it didn't conform to the real complexity of Russian reality at that time.

Those people who were running U.S. policy missed an opportunity, in part, because they didn't realize that this Duma election indicated great doubts within the public about the value of both democratic and economic reform.

U.S. policymakers also didn't realize that the appropriate approach was not to give more support to the so-called reformers, but to try to address those concerns, to ease the doubts about reform--to, in a sense, make reformers out of those who are skeptical about where the country was headed. Neither a sufficient amount of attention nor energy was put into that effort.

. . . But the argument very much was that reform over the long run is necessary to rebuild Russia. Reform of the economy will eventually generate the middle class that will be supportive of democratic politics, and will ultimately produce a state Duma capable of working comfortably with an executive branch that is, broadly speaking, reformist. The question was, in this political environment, given that you have opposition in the state Duma, what can you do that will push the process of reform forward?

We looked then at what was within the Russian constitutional legal framework as to how much could be done in the absence of Duma action. The new constitution that was approved in December of 1993 had a very significant clause, allowing the president to rule by decree in the absence of legislation by the Duma, as long as it did not exceed, broadly speaking, his competence under the constitution.

Again, people were thinking in practical terms--how do we move this process forward? And we decided that we could focus on the executive branch, we could work with reformers, we could develop the legislation. If that couldn't be passed by the Duma because of Duma resistance, then Yeltsin could sign a decree, and that would be sufficient to unleash the process.

What we understand now is that, by going in that direction, we eroded support for the democratic processes. We created the impression that the United States itself was not particularly concerned about the democratic development of Russia--that what was important was this economic side. Given the way the economic side developed--with privatization, high-level corruption, cronyism and so forth--many Russians drew the conclusion over time that this was, indeed, the intended result of American policy.

In November, 1995, you wrote an article that was published in one of the Russian newspapers. What was your thesis in that article?

The thesis in this article is fairly straightforward. Russian politics at the highest levels and also across the country was really dominated by what I would now call political/economic coalitions, but which I then called clans. That is a word that was being used by a lot of Russian commentators at that point.

And basically these coalitions or clans were groups of individuals, and political and economic forces built around control of key government positions, prime ministerships, such as minister of fuels and energy, mayor of Moscow, and so forth.

It meant control of industrial and financial capital, access to information-gathering agencies and media outlets. If you owned the media outlets, it was better. It also meant control of institutions of coercion, both private and official.

This article also laid out what I thought were the leading clans at that point, starting with the gas and oil monopoly built around then-Prime Minister Chernomyrdin. Another group was built around Mr. Korzhakov, who was head of the presidential bodyguards at that point.

Another clan was what I call the group of "Westernizers" . . . which included many of those people who have subsequently been called oligarchs: the Berezovskys, the Gusinskys, and so forth. And then a final one would have been the mayor of Moscow, the Moscow group. People talked about this very broadly in Russia at that time.

You wrote that, from the first, since the dying days of the Soviet Union, these people were not interested in popular support, but in economic support.

They were broadly supportive of a certain type of limited economic reform--certainly privatization that allowed them to control this property in ways they could not have during the Soviet period. They paid lip service to democracy, but were more interested in how they could manipulate this environment to consolidate their own hold over both their political and economic assets.

When they looked abroad, they thought of Russia as a great power, although in retrospect, there were very few of them willing to sacrifice any of their own personal economic access in order to give the Russian state the capacity it would need to operate over the long term as a major world power.

Were they not particularly interested in elections, other than to prove to us that they would have elections?

Well, elections posed a problem. . . . They understood that elections were important for their image in the West, so they had to go through this process. But it was a roll of the dice, given the fact that Russian society was largely unstructured at that point, and that the links between the elites and the broader public had been broken in the early post-Soviet period. They didn't really understand how people voted, or why they voted in certain ways. And they were approaching the next set of Duma elections, and then, more significantly, the presidential elections in June of 1996.

They were surprised in 1993. The question is, what could you do at this point that would decrease the element of risk, both in the December, 1995, new Duma elections and, more importantly, in the June presidential elections?

When did they figure it out?

They figured out that it was possible to manipulate the process. They figured out that you could build a fairly formidable electoral machine if you took the control that you had collectively had--particularly over mass media--your support in executive structures, not only in Moscow, but more broadly outside the country, if you took into account the financial strength you had from these various industries.

They figured out that, by using those wisely, you could lead to the result pretty much that you wanted. They did so in June of 1996, and against incredible doubts when they began this process and, people would argue, against incredible odds.

But this, more than anything else, gave them the sense that they had mastered the situation. They felt you could continue with elections, in part because you could insure to a sufficient degree that those elections would not undermine your own position and power.

Talk about the so-called reformers. Earlier, you said that the U.S. had already chosen good guys and bad guys, and you were not the only person who refers to this group as "so-called reformers." In fact, one of your clans that you've described was at the center of the reformers. Where did they come from?

These were people who came out of a lot of the economic think tanks in Moscow, even during the Soviet period. They tended to be well educated. They were, by and large, members of the Soviet nomenklatura--the Soviet elite. Their leading members spoke good English. They knew how to operate with us. They knew how to talk to us. And they made a very good impression on us, in part, because they seemed to sense what at least the fundamentals of a market were. They seemed to understand the logic behind the types of strategies that we were proposing.

This group expanded and contracted in strange ways as the process went forward, because the original group of reformers really was a small coterie of individuals around Yeltsin, around Yegor Gaidar at that point. Chubais came in from St. Petersburg at that time. It was really the first contact that we had had with him as a serious reformer. But as the economic change moved forward in Russia, a number of business types began to emerge.

Initially, there was a great deal of skepticism about who these people were, in part because of the charges of corruption. There were a great number of contract murders in Russia at that point. So there was a tendency to initially treat these people a little standoffishly. But certainly, by 1995 and 1996, when they rallied with Chubais around Yeltsin, a number of them were also taken into the fold of reformers.

At the same time, we tended to push aside some of those people who did not or were not fully supportive of what was called radical reform at that time. Yavlinsky is a good example--someone that we never cast into the real opposition, but we saw him as less and less helpful in pushing forward radical reform, because he was raising certain concerns, certain doubts, about how this policy was being implemented and practiced.

But there was a more important group, a sort of the center that soured on the radical reformers fairly early on. We either tended not to pay attention to them, or to recast them as unreconstructed Red directors, Communists, and in some cases, ultra-nationalists.

Was this correct?

No. This wasn't true by any stretch of the imagination. These were people who were dealing with a very difficult environment outside of Moscow. They weren't dealing in theoretical models. They had workforces that they felt they had certain types of social obligations to. They also saw tremendous opportunities to enrich themselves.

Some of them wanted their factories to function properly. Some of them didn't, but it was a real mix of people. If you would look more closely and not accept labels like "red dictator," you would have found that a number of these people certainly could have been educated. What they were trying to figure out was how they could survive in this environment. By putting them on the other side of the fence, by not taking their concerns seriously, what we did was to alienate a significant segment of the Russian economic and political elite that would have been willing to work on these programs, if they had better understood the logic behind these programs.

Because we weren't interested? Did we think we knew what we were doing?

To a large extent, that's true. Remember the context, the environment in which all this happened. Before the breakup of the Soviet Union, you will remember the very famous "end of history" article, which at that time did reflect the views of a large segment of the American political-business establishment. There really was no alternative to democratic politics and market economies, which would develop naturally once you removed the obstacles in the Soviet Union.

There never really was any doubt about the direction in which we were urging Russia to go. The view, one of intellectual arrogance both here and in Russia, was that if people didn't understand this, it was because of a certain amount of ignorance, not because they have legitimate concerns. The view was that we needed to push forward on reform as rapidly as possible, because that would lead to the types of benefits that would ultimately persuade these people of the correctness of the policy.

What were the conversations in our embassy in Moscow in 1994 and 1995 between the political section--your section--and the economic section, the Treasury side?

It's clear that people who focused on economics had different views of how this process would work from those who focused on politics. Part of this was also a consequence of the way we went about doing business, and also of the responsibilities that we had.

The economic section clearly had responsibility for carrying out programs. This is part of the technical assistance, and that responsibility naturally brought them into very frequent contact with Russian government officials, who also had a responsibility for carrying out and implementing these reform programs. So both had a desire to see these reforms succeed, and their views were mutually reinforcing.

These people also had contacts with others that would lead to a different view of what was happening. But nevertheless, the overwhelming weight of contact and information that they were receiving was supportive of the view that this policy was right and it was moving forward.

The political section, at least the internal section, did not really have responsibility for implementing any types of specific programs. Democracy-building was largely handed over to USAID, the United States Information Agency. So our mission required that we cast the net more broadly, that we talk to some of the outsider elements, that we talk to Communists and nationalists, people who weren't in government. We probably had a different balance, and ours was balanced towards those who were dissatisfied with the reform process, who saw themselves as outsiders, as people who had been stripped of a certain amount of prestige, power, and authority. Obviously, that got reflected in the way we saw the politics.

That said, on balance you will find that the reporting that came out of the embassy in Moscow gave the people back in Washington a fairly broad and, on the whole, accurate view of what was happening in Russia at that point. . . . Nobody hid the fact that there were problems.

No effort was made to censor reporting to suggest that there weren't problems. What needs to be underscored is that we wouldn't have been the only source of information on what was happening in Russia. Certainly there was enough in the Russian press itself at that time to suggest that there were potential problems in this process. The Western press reported on some of this, although they tended to be much more supportive of the reform overall. So the information was out there--that there were some problems with this process. It was also evident.

The question is how you weighed that into your actual policy decisions of whom to support, what programs to support, and so forth. Certainly in the early years--but I would argue right up to the August,1998, collapse--clearly the administration tended to weigh more heavily those bits of information that suggesting that the policy was being successful, as opposed to those bits suggesting there were deepening problems.

1995 through 1996 . . . Can you talk briefly about the loans for shares, growing corruption, Chechnya, and then the elections? What you were seeing and reporting as those things were taking place?

You have to put this into context. Remember, this was the electoral year as well-- Duma elections and presidential elections.

It's clear that there were concerns about what the loans for shares really meant. Anybody who looked at those even superficially realized that these were largely insider deals. It wasn't an open auction process as the Russian government claimed it was at that point.

The same thing with Chechnya. There were doubts about what was happening at that point, and certainly it was reported. It wasn't clear that Moscow really had a strategy that would lead to success in this operation. It was clear that they were going about it in a fairly ham-fisted fashion at that point. But a lot of that discussion got lost in this epic battle between the forces of good and the forces of evil.

As a political establishment, we thought it was imperative that Yeltsin win, or that someone like Yeltsin win in June of 1996, in order to continue the reform process. There was deep concern, particularly after the Duma elections in which the Communists did much better than we expected they would do, that if they came to power, it would set the country on a reverse course back towards a Soviet-type system.

So this overwhelming priority that Yeltsin be elected caused us not to focus as much as we should have on loans for shares, Chechnya, the growing evidence of corruption, and particularly the corruption that was clearly visible during the election campaign itself.

No Russian now makes any bones that they violated their own laws on finance and use of media and so forth during the elections. But this was a classic case of the ends justifying the means, and we did get the result that we wanted. We got the result that our partners, reformers, in Russia wanted, and it's after we got that result that a lot of this began to unravel very visibly for people both in Russia and the West. And the problem turned out to be Yeltsin, whom we now know was very sick at that time, who almost died between rounds of the presidential election. But certainly, after he was elected president or reelected president, he did not have the political stamina to devote time and energy to push forward the types of reform that we thought that he would if he were reelected.

And the so-called reformers--our team--are they the ones who are, in part, pushing that this is either us or the Communists--that it's black or white?

That's the way they saw their own political process. Certainly, maintaining their political position, their access to power and money was contingent on our seeing it that way as well.

So part of this is a reflection of what they really thought the situation was. And part of this is exaggeration for our effect. They also realized that they needed to paint it this way as part of the strategy of manipulating Russian society because, over time, votes indicated that there was really no desire within the Russian body politic itself to go back to the Soviet system.

So you had to brand these people as Communists. You had to blacken them as much as possible in order to enhance your own chances of winning. The West largely bought into that without giving it a great deal of critical thought.

Was the U.S. aware of the corruption and irregularities? . . .

Sure. We were aware of it. This isn't new information to anybody. Again, the question is, where do you put that in your table of priorities at that point?

The overwhelming priority was to get someone that could be broadly labeled a reformer elected president of Russia. The assumption was, if that happened, then you could deal with a lot of these problems later on; that corruption would go away as the reform process moved forward; that you would be able to rectify some of the inequities in the way property had been privatized, and so forth. The problem ultimately is that we never got to that stage.

Isn't it also part of the problem that the so-called reformers were themselves mixed up in the corruption?

Obviously. Again, broadly speaking, I don't think that people were unaware of these allegations. Certainly less credence was given to them because, after all, these were people you dealt with. You have a higher standard of proof for demonstrating that your partners are corrupt than you do for other individuals. So there was a higher threshold that the information had to clear in order to be persuasive, but certainly we were aware of all of that.

The problem came after Yeltsin was reelected--certainly in the summer of 1997. You will remember the Syvazinvest deal, where the evidence began to mount that somebody that we had supported before was corrupt, and you could pick your group.

There was an effort to focus the attention on the so-called oligarchs, and to treat the government with Chubais and Nemtsov as being less corrupt and more reformist, and these oligarchs as being corrupt business sharks. We consciously neglected that Chubais had his own oligarchs who benefited from this process, and we didn't ask a lot of questions at that point. But by then, we had become increasingly wedded to Chubais and his group of reformers as the agents of change in Russia.

When did the word "reform" begin to lose its definition?

. . . Reform had a fairly clear definition around 1992 or 1993. You knew you needed to liberalize prices. You needed to stabilize finance. You needed to privatize. You needed a commercial code, and so forth. You needed to develop a party system.

The problem is that when these meet Russian realities, the process becomes messy, and then what really constitutes reform becomes much more difficult to say. You also begin to realize that there are tradeoffs here that you didn't focus enough on initially.

Democratic reform can lead in different directions from economic reform. The classic case was of a democratically elected state Duma being composed of people who were opposed to the type of economic reform we wanted to see.

So we lost clarity as to what this process was really supposed to look like. The administration narrowed its focus down to the economic part of it--a certain type of economic determinism--that if we just get the markets right, this would bring in foreign investment, lead to a Russian recovery, spread the wealth, and develop a middle class which would be supportive of democratic values. There is a certain magic to that formula. After all, this is what we thought had happened in places like South Korea in the 1960s and 1970s, with economics leading to the social demand for more democratic politics.

So how did we justify it all to ourselves after Yeltsin's reelection? Our rhetoric was still not just economic reform, but the development of democracy, of a democratic state.

We narrowed the definition of "democracy" largely to elections, and that's what we focused on. In fact, this had been the refrain throughout the Yeltsin period--that the key here was elections.

In April, 1993, Yeltsin goes to the people for a vote of support. Yes, October, 1993, was a misfortune, a tragedy. But yet, Yeltsin went to the people and got another vote of support in December, 1993. This is what democracy is about--people expressing their will.

And even in 1996, although we're aware of the massive pressure and some of the violations of Russian law that went into Yeltsin's electoral campaign, we managed to persuade ourselves that this is what the outcome would have been in any event, even if they hadn't done this because, after all, the Russian people don't want to go back to communism.

So that's what we focused on. There was a series of elections at the regional level in 1996 running into 1997, and then we've just gone through another cycle of Duma elections. This is what is always pushed forward as evidence of reform; the other is the media, certainly the openness of the media.

Now, people are aware that certain oligarchs control one media or another, but what we focused on is the pluralism of opinion. Yes, there is a wide variety of opinion being expressed in Russia today, and that itself is evidence of democracy.

And then we reverted back to where we started--that this was going to be a long process. Yes, it's not perfect, but if you remember where the United States was in 1820 or where certain other countries were, then this certainly was an improvement over the Soviet period. Broadly speaking, it could fit into a process of democratic development that we had seen elsewhere in the world over the past 200 years.

But isn't it true that all Yeltsin and the team had to do was display a nod toward democracy, and we got the result we wanted? And we didn't want to hear any criticism of that again. Is that true?

What you said is true, but this was always a process where we didn't ask a lot of questions about what had happened. We were always looking forward, in part because there wasn't a lot of time for introspection, given how rapidly things were developing at that point. But also it was a very messy process. Once you're committed to a policy and you only have a limited time to carry it out, introspection about a sort of grand strategy really doesn't help you, because you don't have enough time to go through that process of reappraisal and then institute another policy.

So what you found was that our own political process in the United States created a disincentive to seriously look at a policy towards Russia, to make serious adjustments, or to go back to the drawing board and . . . whether this was going in the direction we wanted . . . and what to do if it wasn't.

How much did it have to do with the fact that this administration had determined that Russia was going to be a success story?

This was the top foreign policy priority of this administration when they came to office--a strategic alliance or partnership with Russian reform. We were going to turn a former implacable enemy into a partner, and for the longest time, this was one of the few seeming successes of Clinton foreign policy.

So the drive has always been to be able to present this as a success. Even today, in some of the comments we're hearing about Putin, you see this desire resurfacing once again. If only we can get to October, Putin will do a few things that will allow us to say, "Yes, we always knew there were going to be setbacks, but, see, Mr. Putin was legitimately elected president of Russia. He has brought the Chechen conflict to an end. He has ratified or gotten the Duma to ratify START-II. He has pushed through legislation land reform and a new tax code." This is evidence that the policy we started with in 1993 was basically correct. . . . and now we are reaping some of the benefits of that policy.

But you fundamentally disagree with that assessment?

Yes, because this is a much more complicated situation. A lot of this is wishful thinking on the part of the administration. It's an open question whether a tax code and land reform is going to lead to a turning of the corner in Russia. The process of rebuilding a Russian economy really is one of a generation. I don't think that this administration or a lot of other Western commentators have focused sufficiently on the extent to which Russia has declined over the past decade--how deep the socioeconomic crisis has been, and how difficult it is going to be for Russia to dig itself out.

Also, you are going to again find that economics and politics are going to work in different ways. Mr. Putin clearly is intent on rebuilding the state. Rebuilding the state in Russia has always looked authoritarian. In fact, it has to look authoritarian, because what you're doing is beginning to put restrictions on people where there weren't any before.

So it's going to be very difficult for the administration, almost no matter what Mr. Putin does, to present this as evidence that their policy was correct from the beginning. What it's going to do is to show up the inconsistencies in that policy--the contradictions between democracy, market reform, good relations with the United States--certainly in the short term--no matter what that might mean for those three processes over the long term.

One thing that's been transformed in the last decade is the attitude towards the United States--not just among the elites--but among the Russian people.

That is true. It actually began to deteriorate among the Russian population in some ways a bit more rapidly than it did within the political elites. The political elites are catching up with them. The population had much more skepticism about this reform process early on, in part because they bore the brunt of the negative consequences of it. They tended to associate that with the West, and particularly with the United States.

Certainly, we've seen this growing anti-Western, anti-Americanism within the Russian political elites. The key to this really was the collapse in August, 1998. That ended hopes that this transformation was going to be rapid and successful.

. . . Political elites began to question the type of advice that the West was passing on. Many of them drew the conclusion that the West had achieved what it wanted, which was the weakening of the Russian state.

By then, you add on top of that Kosovo, the Bank of New York scandals, and Chechnya, and you can see that there really is a deep psychological basis for this growing anti-Americanism within Russia.

This is also a consequence of the fact that a lot of Russians still do not want to face up to their own responsibility for what happened in Russia. At least a segment of the political elites is looking for someone to blame for the fact that they stole money as a way of justifying their holding onto that money.

"Yes, these were bad policies by the West. But if we don't stand up to the West now, if we have an internal domestic battle, a blood-letting over how this property was privatized, it's only going to put us in a weaker position." So in a very cynical way, the anti-Westernism plays into the very narrow parochial interest of a large segment of the political elite, which benefited from the policies that have been pursued over the past decade.

What has Russia become in the last decade?

It has become a very weak country that in many ways resembles feudal Europe.

We've seen is a major socioeconomic crisis. The economy has declined by half. Public health is in a shambles. The educational system is in shambles.

What we've also seen is that political power is both privatized and fragmented, and this is how it resembles feudal Europe. Sovereignty and ownership are combined in parcels across the country, and it's very difficult to recombine these elements in a way that leads to sustained economic and political development over time.

So that's what I would call it. I know what we have returned to is a kind of feudal Russia. But unlike the feudalism in Europe, it is not based on agriculture anymore. It's based on industry.

What do your friends and your contacts in Russia think about what is happening now? What is going to happen in the next few months?

There is a lot of anxiety. Many Russians are finally coming to grips with the fact that their country has declined drastically over the past decade. Look at Putin's Internet message at the end of last year, which laid that out in very great detail. Russians are willing to accept that now, whereas they wouldn't have accepted it three or four years ago. At least the radical reform elements, those who were pro-reform, would not have accepted it. So they understand that. They understand that, unless they begin to rebuild their country, they are not going to be able to enjoy the status in world affairs that they think is due Russia.

Now the real question is, to what extent are the Russian political elites prepared to make the necessary sacrifices to begin to rebuild their country, and how they would see those sacrifices? The Russian political elites have enriched themselves over the past decade by preying on a weak state. They really don't have an interest in a strong state, for all the rhetoric about the need for a strong state.

Are they going to change at this point? That is an open question. At this point, they have a lot of anxieties about Putin, in part because, to a certain extent, they made him as a political leader. But they don't know whether they can control him. They don't know what this type of figure, who is possibly uncontrolled, means for this system that has developed. Will he be able to find sources of support, particularly in the institutions of coercion that will allow him to discipline this elite, and build the strong state that this elite says they want, but at their expense?

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