World Policy Institute – Russia: How Perceptions Shape Reality Transcript

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The Post-Transitional Russian Identity


Russia — How Perceptions Shape Reality
A panel discussion with (in alphabetical order)

James Collins, Former US Ambassador to the Russian Federation 1997-2001

Masha Gessen, Journalist (US News and World, Bolshoi Gorod)

* A Ranking Bush administration official.

Please note; this official is actively involved in policy issues and therefore requested their comments not be for attribution.

Moderated by Nina L. Khrushcheva (New School University)

On December 1, 2004 the project on New Post-Transition Russian Identity, sponsored by the Carnegie Corporation of New York and organized jointly by the New School University, The World Policy Institute, and the Harriman Institute at Columbia University, presented a seminar entitled “Russia — How Perceptions Shape Reality”. The following is a transcript, for a discussion summary, please click here.

Nina Khrushcheva opened the discussion by thanking the panelists and invited guests for their attendance. After introducing the three panelists, she offered questions for discussion to each. She noted that Masha Gessen has been a strong critic of Vladimir Putin and of the notion that Putin’s ‘clear vision’ of a strong Russia is what was needed after the turbulent Yeltsin era. To the administration official, she asked what did the reelection of George Bush mean for America’s Russia policy for the next four years; and what were the primary differences in the approach of Bush compared with that of Bill Clinton towards Russia. Finally, for James Collins, she asked him to discuss what factors have contributed in shaping Vladimir Putin and what is his perception of Putin as a strong hand for a strong Russia.


JAMES COLLINS: Thank you Nina, thank you all for coming, it’s a pleasure to be with you. It’s a big topic: trying to get a sense of what I might say that would be useful that you haven’t seen or read in thousands of other places was more of a challenge than finding something to talk about.

I thought what I would try to do is give you about three points that I believe affect the way that Russia develops and the way that Russian-American relations continue to develop and that have a remarkable capacity to endure despite many changes in reality and seem still to be central to many of the kinds of perceptions and issues that come up between us.

The first one I want to suggest is one that has been in place since the very earliest moment in the nineties and the collapse of the Soviet system. That is that Russia still is a country that is trying to define itself, its place in the world, to establish some new consensus at home about just what it means to be a Russian, what Russia will define as the implementation of modernity and then how it is going to pursue the process of putting in place the institutions and structures that will bring about that condition. It is a messy process. I think one of the more perceptive views that I ever heard about the nineties was that a way to look at it, and it was given to me by many Russians, was that it was a time of troubles when the old legitimacies disappeared. The whole raison d’etre for a regime and political structure disappeared and you had a society that was cast adrift, in essence. In some ways a compass was simply absent. In many respects there were some efforts, and I think some very important efforts, by the Yeltsin era, and by Yeltsin himself, to set some new direction and to define some new purpose. But it was a very limited process in its results and it had some very weak parts.

I would say, basically, that he did try to establish a new basis for legitimacy and I think, remarkably, that it probably still endures as the one source of legitimacy for political power in the Russian Federation, and that is basically in some way, shape, or form; that power and legitimacy evolve and come only from the people. They do not come from an ideology, they do not come from some kind of dynasty, in short, it is a popular mandate alone that legitimates political power today.

Now, one can argue how that gets expressed, but it was a tremendous change in Russian history, in fact I would argue that it was the biggest revolutionary change of the 1990’s. I think it persists quite simply, if you aren’t elected today in Russia you do not have legitimate political power. How fair the elections are and other things may be an issue, but elections now are the way you do it.

The second thing that it seems to me he put in place was the idea that you were going to have something like an international version of a market economy. I try to avoid the term western because I think it is broader than that. But market economy was the term and market economy was the goal. I think remarkably also if you look at the short period of time we have seen the development of things over the nineties a tremendous amount of basic market economic institutions and structures and relationships were put in place in their early stages. Such things as private property, the concept of ownership, the concept of profit-and-loss, all of these things are fundamentally new in the context in which they were put forth. And Yeltsin essentially and his people set down that direction.

What I think he didn’t succeed in doing however was in finding a way to define what it meant to be Russian. A number of people throughout the nineties with whom I talked and who were trying to monitor and understand where Russia was headed, identified that issue as the single biggest difficulty that remained to be resolved and the one that was also the most volatile in terms of political manipulation or demagoguery. Do I think these things are still with us? I do think they are still with us, I think that this is the issue of defining just what Russia is about and what it means to have a Russian market economy, a Russian democracy and what it means to be Russian in the global context remain the central core problem for Russia itself as a society.

This in turn made life difficult for an ambassador or a DCM in Moscow for most of the decade, because in fact if you think through some of the implications of it, what it meant was it was very hard for Russians themselves to articulate or define positions on any topic that was in front of us.

Was Russia a great power, and what did that mean?

I think one of the most enduring difficulties I experienced throughout my time was in essence a Russian perception of their power that did not equate with reality: that Russia was an economically weak nation for most of the 90’s, lots of potential but nevertheless unrealized: that it could bring relatively modest authority to bear on most of the international issues of the time. Russia could play a diplomatic role, it could play a role at the UN but the limits of its ability to project influence and power were very severe: and yet, in many ways, the way in which Russians talk to themselves about their role was much more suited to the 1970’s in the Soviet Union than it was to the Russia of the 1990’s.

This in turn played back to the United States and caused substantial problems on our side. In my view, we tended to treat ourselves as victors in the Cold War which meaning we saw Russia as having lost. This was a view that in many ways was pervasive and was particularly acute during political campaigns in the United States. This view distorted a lot of the approaches that we were to try to take with Russia.

The second point I wanted to make to the audience is one that I have seen almost never discussed about the relationship. I have seen it discussed a great deal about Russia but not really about the relationship and that is that it wasn’t just Russia that had a weak President in a second term in this relationship. The United States also had a weak President or a weakened President. The second Clinton term taken up with everything from the impeachment proceedings to a variety of other issues made it very difficult for the Clinton Administration to continue a well defined and clear policy toward the Russian Federation in the second term.

A number of issues arose that complicated the relationship and with the 1998 financial collapse increasingly became a subject of politicization in the United States, a condition that had not pertained through almost all of the first Clinton term and much of the beginning of the second. But, with the 1998 collapse we got into the who lost Russia debate, which was one of the most sterile exercises I watched. We got into issues of really misperceiving each other and growing misperceptions on the part of Americans about what was really happening in Russia. I would give you the case of the Balkans for instance as perhaps one of the biggest issues. The Americans never really addressed issues on the Russians minds about the Balkans. They talked to our European allies and to ourselves and it wasn¯t too surprising to me that the Russian Government at that time and Russians generally had very little understanding about what America understood itself to be doing in the Balkans.

The Russians meanwhile, in my view, really weren¯t all that focused on the Balkans. They were really using the Balkans as an internal domestic political argument and what happened for the most part in Moscow, in my view anyway, was that all of those people who had sought to confront or stop the Yeltsin revolution or thought 1991 was a big mistake found the Balkan crisis and particularly the American intervention in Serbia as a perfect time to take on Mr. Yeltsin. You had a very substantial groundswell building on a deeply emotional reaction to the bombing in Serbia which the opponents of Yeltsin and his people tried to exploit. Yeltsin was smart enough politically not to succumb but nevertheless, it was a pretty critical point in the American/Russian relationship.

Part of this again though was that we had two weak presidents. We did not have presidents driving public opinion in either country very successfully and the result was that the critics of the relationship in both countries increasingly set the agenda for the discussion about US/Russia relations. That was true of both the Republican critics here in the United States and it was true of the Russian critics in the Russian Federation.

Finally, a third point I wanted to raise for you is one of personal experience. It is one I think it is important to think about today: it has to do with two specific ideas.

One is that bureaucracies do not do well with revolutions. I was the charge for a good part of the 1991-92 period and worked on those issues in Washington following that. A key reality was that in Russia during this period you had tremendous expectations about what the United States could deliver, produce, do, help with, etc. I would get questions from serious people asking whether we could just send up someone to tell Russia how to make a market economy. There was an expectation that somehow there was a formula you could transplant or you could rather easily set up a set of three or four institutions and that would take care of the problem. Totally unrealistic expectations.

On the other hand, the American bureaucracy and the American government generally tend to think that when you do something in Washington it has immediate effect. What they don¯t understand is that in the case our assistance programs, for example, a vote of money doesn¯t have impact in Moscow and it can take up to two years to see visible results on the ground. As an example there was much discussion in early 92 about trying to set up some kind of mechanism to assist privatizing businesses. To have both technical assistance to help them get going but also a certain amount of capital. So they came up with an idea of an enterprise fund or what amounted to an investment fund. Well, that came on line in 1994 well after its usefulness in many ways was past. It never really met its intended purpose. But by the time you got it set up, went through the legislative process of appropriating money, etc. etc. the realities of Russia had changed four or five times. And so you are always in some sense behind and I don¯t think I can emphasize enough how this hurt perceptions. It hurt perceptions on the Russian side by feeling that the Americans weren¯t responsive. The problem was simply that passing an aid bill in Washington didn¯t produce any tangible result; consequently, it really had no affect anywhere in the Russian Federation on this perception. Then by the time effects did come along people were talking about something else in Washington and its effects were largely diluted. So the simple slowness of the capacity of the American government to respond was a real problem. It¯s perhaps less a question today when assistance is more restricted. But I give you the examples of the nuclear arsenal and trying to accelerate programs to move it. This is an extremely difficult and slow process. If you began tomorrow the process of doubling the program, you would be lucky to have it done in two

So this is a problem that affects perceptions on the Russian side about America’s responsiveness to real needs even if its not quite correct, and on the American side on frustration that grows that things don’t happen quickly on the other side. The second problem I would give you is more an American than a Russian one, but it affects both. In my experience most American perceptions about Russia are based on snapshots. They are formed on the basis of some one or two events, or some one time picture that is defining. These photographs or these snapshots persist as images that are extremely difficult to deal with because the reality is that you are dealing with a moving picture, or a film or a play or some kind of event that changes through time. As ambassador trying to explain the reality of the then present-day Russia I found this presented an extremely difficult issue, because you began talking with people who had a premise, for example, that Russia was defined by the financial collapse in 1998, a country that didn’t pay its debts. Russia was a country run by the mafia; a view almost pervasive in the early 1990’s. These images, however they were formed, just didn’t change despite developments in Russia. They didn’t change in part because of media but also simply because people formed that view and had no experience in any ongoing way of what was happening on the ground. I think this was partly true at the most senior levels of our government in the 1990’s. We had articulated, as all administrations do, in the first Clinton years a fairly straightforward, I would say multi-faceted, but rather clear approach to the Russian Federation, what we were trying to do. The problem is that they kept saying the same thing in 1998, 1999. The realities in Russia had changed many times in the process, which meant that our language and our vocabulary and description was increasingly out-of-date. I think that is inevitably something
that affected the effectiveness of the Clinton policy in the later nineties with respect to Russia. It also affected perceptions of American policy, because what Russians heard in the late 1990s was much more out of synch with their realities than it was in the early 1990s, and therefore you had an increasing sense of division and lack of real effective communication. Why don’t I just leave it at that and we’ll talk about it.

The following is a summary of the US administration official’s opening remarks:

(While the United States and Russia have developed a partnership, it is not yet a strategic partnership, which has been the administration’s goal. There have been several hindrances to establishing a true strategic partnership, including lingering Cold War mindsets in both capitals, along with questions on where Russia is going domestically and in terms of its relationships with its neighbors.

On the domestic front, there is concern about recent moves by Putin in curbing media freedom and consolidating power in the presidency. The Yukos affair is also a matter for concern. These moves could be viewed as an attempt to reassert state influence over a democratization process with drastically weakened the central government in the 1990s. In terms of relations with its neighbors, there has to be an understanding that each is a sovereign nation in its own right. They should not be thought of as pawns in a game between the US and Russia, nor should we try to exercise American influence at Russian expense. Good relations between Russia and its neighbors and Russia and the West is in everyone’s best interest. We can all benefit from a cooperative approach towards issues of security and Governance.

Regarding Ukraine, there has been concern over the Russian approach to the recent electoral process that Russia is trying to exert an amount of control over the outcome. We have questioned the level of their involvement and will continue to monitor the next round. We must realize that Russia is heavily invested in the region and that this should not be viewed as necessarily a negative thing. Russia can be viewed as trying to make a profit with their investments; therefore their investments should not be viewed as a zero-sum issue where they are in competition with the West.

The United States should continue to make our concerns known to Russia, and try to influence its growth and development along a democratic path. Since Russia is no longer dependant on the IMF or other international lending agencies, this avenue of direct influence is limited. However, the strong personal relationship between Presidents Bush and Putin, along with Condolezza Rice’s appointment as Secretary of State, should provide a method for the United States to build on the US-Russia partnership.)

Masha Gessen:

I will try to respond in the order in which I took notes, so I’ll jump around a little bit. I first wanted to talk about the issue of order out of chaos which is something that comes up again and again when people talk about Putin and the Putin regime. I think its time to try and pin some specific measurements to those discussions. I think that one thing people tend to forget or overlook when talking about this desire for order that was very pronounced in the late nineties was that by the time that Putin came into power that desire wasn’t as pronounced, that opinion data that we often refer back to is opinion data that refers back to the immediate aftermath of the financial crisis of 1998 when people felt like the rug had just been pulled out from under them. By the time Putin became acting-president and the president the opinion data no longer bore that out. Crime was down, the economy was stabilizing, this is when I’m talking about by the end of 1999, at the time the postal service was working again after many, many years of nearly not working, there was a general sense that things were stabilizing.

Now compare that to the situation today. Crime is steadily growing; it has hit record highs, record even compared to the nineties. And that is across the board, from contract killings, to street crime, to apartment robberies. When we talk in general terms about Putin bringing stability to the country, let’s think about specific people who actually do not think there has been any stability, Beslan is certainly a good example of how that turns out not to be true, but also in people’s everyday lives. They certainly sense that there is no such thing as order out of chaos that Putin has brought. I’m very glad that you pointed out that the women who got on the planes that went down on August 24th bribed their way on. But to me an even more telling example of how entrenched corruption is at this point and how it is simply impossible to fight is what was happening in Beslan during the siege.

You’re nodding so you probably know that I didn’t go to Beslan because I have sort of given it up because I have two small kids, but a lot of my friends did and I talked to them and a lot of them had a sort of similar experience. They had assumed it would be extremely difficult to get to Beslan because you had to fly into a place that is a couple of hours away and then take a car and since the area was surrounded and supposedly sealed off it would probably be impossible to get on. Well, it cost 100 roubles, that’s just over $3 to jump the line at any checkpoint and to cross the checkpoint without having your car checked. And this is during the siege, when you would expect the maximum amount of mobilization and you would expect that even people that depend on this income from corruption for their livelihood would give that up out of a sense of patriotism, or human decency, or something. That wasn’t happening; those practices are so deeply entrenched.

Jumping around here, I want to respond to what Amb. Collins said it’s still being true that what was established during the nineties, during the Yeltsin era, that the only true power comes from the popular mandate. I really don’t see where you would see evidence of that in contemporary Russia. Certainly, Putin’s Sept. 13, announcement, essentially canceling popular elections of anybody but himself, is an indication that he doesn’t believe that to be true. And even note the reaction to that announcement in the country has been overwhelmingly positive, it also hasn’t been overwhelmingly negative. There certainly no basis for saying that a popular mandate is something that is necessary for a politician to have. And in fact if you look at the pattern of governance in Russia in the last few years and look at the way people share power, one of the most powerful people in the country is the Prosecutor General and nobody elected him. But he in a lot of ways is setting the agenda for what happens in the country which brings us directly to the subject of market economy and what was said about the Yukos case not scaring away foreign investors. >

I think that is a very interesting topic and one that probably merits further discussion but frankly I think that more than anything else I think that we are seeing and opinion lag that is partly a function of distance and partly a function of the very interesting and morally questionable work that the investment fund managers are doing in Russia. If you look at the impact that the Yukos case has had on the Russian economy and the Russian economic climate, that’s much more pronounced. Let’s sort of focus on what the Yukos case says. Getting away from the questions of why Khordorkovsky was arrested and why he would be in jail, what is the essence of the charges? The essence of the charges is that Yukos used legal loopholes to minimize its tax payments, and they were legal but they shouldn’t have done it. That’s the essence of the charges. That is a message that has already gotten across to the public and law enforcement, especially the tax inspector. Even though the Yukos case isn’t over yet and nobody has been convicted, when the tax inspectors come to people in large businesses, small businesses, medium sized businesses, and present them with back tax bills they are based on this assumption; that you used legal loopholes, but you shouldn’t have done it. People pay up.

Not only do they pay up, but the courts agree with this, and there’s a recent constitutional court decision that is very convoluted, but it basically boils out to the same thing. It’s a decision on back payments, and the assumption. I should say it’s a resolution with a clarification, that’s what it was. But its binding, the constitutional court resolutions are binding. What the constitutional court essentially said is that there is a particular regulation on VAT exemptions that can be used in bad faith. And because it can be used in bad faith, nobody should be using it. That’s the essence of the decision. And that is very much the logic of how tax enforcement is happening now. And that’s happening across the board.

The other sort of import of the Yukos case, and again this is something I’d really like you to think about, is the message of the Yukos case is the largest oil company in the country, the largest oil company in the world, one of the best managed companies, possibly the best managed company, in Russia and no one is contesting that; should not have been profitable at a time of record-setting oil prices. That’s sort of the conclusion that you would draw. And since that is a difficult conclusion to agree with, the other conclusion is that if someone makes a lot of money, the government is going to take this money, That’s a message that is getting across very clearly, and one of the ways in which we saw how clearly that message is getting across is what happened in July in the little banking crisis. If people followed that, what happened was there was a small bank, it ranks in the top 200 banks, Sodbiznesbank, which had had an investigation against it for money laundering for two years, there were some clear violations, there were some court decisions, it had its license revoked in late June. After that there was a supposed black list of 10 banks that was circulated on the web, it wasn’t published in any reputable publications, it just circulated. And that resulted in some textbook bank runs. Basically people descended on banks in droves. The reason people descended on banks in droves, even though a lot of government officials, and a lot of private businessmen were on the radio, were on the television assuring people there should be no reason there should be a bank crisis in the country, the currency situation is as stable as its ever been, there are no objective reasons for a bank crisis the people did not believe that. They believed rumors that circulated on the internet. They ran for the banks. As a result, one of the top 30 banks in the country, Guta Bank, went from being one of the top 30 banks in the country to
collapsing in the course of two weeks. What was left of the bank was bought by Vneshtorgbank (VTB), which is a state-run bank, for $32,000, after two weeks of this.

I think that’s an excellent way of taking the measure of the general economic psychology of the country. And understanding what kind of message people have gotten, from among other things, the Yukos case, and what kind of understanding people have about the way the economy works and about how the government is going to treat them in essence.

Now again jumping around I wanted to reply to what Amb. Collins said about snapshots and our language and descriptions being increasingly out-of-date because of certain snapshots that have stuck in memory. I think that’s a very perceptive description, but I would sort of broaden it to discuss not just snapshots, as narrative. There’s a story that a lot of policy makers and a lot of journalists have been telling for more than a dozen years now, and that story is basically; there’s a country that is building a market economy, and a popular democracy that is fighting a lot of obstacles left over from Soviet times, and so there are good things that are new and bad things that are leftover from Soviet times. That’s a fine story and I think it suited the nineties fine, it happens to have missed a sharp U-turn that the country made at the turn of the century. That is that instead of going in the direction of building a market economy and building a popular democracy, the country has started going backwards, and the bad things that we are describing are not leftovers from Soviet times, but are newly-created problems that are a function of the current regime. That I think goes directly to (what was said), about the need for the narrowing of the values and principles gap.

I’ll run through this quickly. In that case I’ll just jump straight to Ukraine which I think is extremely instructive on the question of values and principles, but also because it has exposed a lot of truths about the way that Russia is run and the way Russia works. One way in which that has happened, as you probably all know; both campaigns in the Ukraine were largely run by Russians. They have brought their tools with them and it is fascinating to see what has happened with one of those tools. For example, there’s this thing called teymka, I don’t know if anyone has ever heard of them, you’ve heard of them, teymka is a morning memo that is handed down to the editors of the state television channels, and we don’t have any other kind in Russia, that have a full list of topics that will be covered during the day and descriptions of how they ought be covered. They are quite detailed. In the entire time that the teymka have been used in Russia, to my knowledge there has been only one instance of a teymka being leaked. Which is amazing in the measure of complicity on the part of the people who get these teymka is pretty incredible. And also the measure of fear in the country that that give us.

What happened when they got to Ukraine was that people started routinely leaking teymka and at a certain point between the two election rounds the teymka just started getting published every morning. So television executives would get these teymka, hand them over and people would start printing them, or post them on the internet. Another thing that I think, and I’ll finish with this, but its really food for thought to my mind, another thing that Ukraine has really exposed is how isolated and weakened Putin has become. Because one thing that has happened is that a lot of Putin’s closest advisors, after the second round, have rushed to speak privately to journalists to say that, to disavow basically everything that Putin has done on Ukraine. And to say that going to Ukraine to support Yanukovych, and to appear on all three state television channels at the same time was entirely his own decision, that he was advised by his press secretary not to do this, that it was all his initiative. Personally I don’t believe that for a moment. Regardless of whether or not it is true, it’s very interesting to see how some of his closest people are working to distance themselves at the first opportunity they get and also at the first indication of criticism being directed at Putin.

What I’ll actually close with was what (said) about in the leverage that the United States has. I think that you probably underestimate the amount of leverage that the US has at the moment. Putin does feel besieged, he feels in some ways even marginalized in his own country and by his own government. At the same time also a disproportionate part of his legitimacy rests on his ability to maintain his stature abroad. And if you look at opinion poll data, the people do this quarterly survey on how well Putin is doing in different areas, and pretty consistently over the last couple of years that poll has shown that when asked if Putin was doing a great or good job, people overwhelmingly say he is doing a great job. When asked whether he has done a good job on the economy, people are sort of on the fence, but slightly more people think that he has not done such a hot job on the economy then think that he has. When asked about Chechnya and there are two different standard questions on Chechnya, on the war and on constitutional order, people say that he has done a very poor job on Chechnya. Basically the only question on which people consistently respond that he has done a good job is raising Russia’s stature abroad. And that is a direct result of the support he is getting from the West, primarily from the United States. And that points to the leverage the United States has in criticizing him.

NK: Thank you. I would love to give you the time to respond to each other, but I have no time to give you. So if we can please open it to discussion. I will take a number of questions, then people will respond or comment, and then I will take another number.

Kim Marten (Barnard College, Columbia University:

I found this discussion fascinating; especially when you think about things, Putin has not gone in the direction we expected him to go back when he first came into officeòWhat in the world is he trying to do n the economy? With all these actions that are being taken, is there some sort of rational aim that is the endpoint of everything that is being done with Yukos, towards allowing corruption to continue and so forth. (To the administration official), it seemed for awhile that the US and Russia were sort of able to balance things back and forth, when there were disagreements they have a blow up of things, then paper it over and things would go back to the way they were before. In the past couple of months it seems that the anti-Western rhetoric coming out of the Putin administration is unprecedented. And we saw that first when he was talking about the United States was trying to use Islam in a way that looked like Munich to push all terrorism off on Russia so that the US didn’t have to deal with it. And then the kind of statements that have come out the last week or so on Ukraine have just been really stunning, they go back to things that came out of the Cold War. Are we seeing something new in what the Putin administration is doing?

Andrew Nagorski, (Newsweek :

My question would be on this issue about the zero-sum, not having the zero-sum game, which is a fine sentiment, but take what is happening in Ukraine right now. How does this not become a zero-sum game when Putin has committed completely one way and assuming the outcome will be the other way, how do you dress it up differently?

And the other point I wanted to address was the point you made about the special relationship you made about the special relationship you made about the special relationship between the two presidents. The partnership hasn’t developed into a strategic partnership. What is that special relationship? What does it mean? What has it produced?

Jeff Madrick (New York Times):

Let me pick up with the relationship between Putin and Bush. Are there any examples where that relationship has produced constructive results? Number two, and something which bothers me very much. I’d like to ask about 3,000 questions on the economy, but let me ask you this about Bush as a role model. It seems to me that when I read the newspaper, when Putin reads the newspaper, he sees that America has human rights problems; Abu Ghraib, Guantanamo, and the Patriot Act; it has problems with democracy here, it may not know the extent of it, but it seems to reflect some Bush policies. There have been some enormous financial scandals in the US, Bush has not taken a strong stand against those financial scandals He supported Sarbanes-Oxley, but very few people I know think that’s adequate. I wanted to ask all three of you, but perhaps most (the administration official), whether you’re concerned about the Bush role-model, not the least of course the War in Iraq that was not supported by the original rational, does that open the door for more violent action in Chechnya?

MG: What is Putin trying to do with the economy? I think that history is full of actions that are geared towards one goal, achieving a completely different (set of) goals. My own analysis is that Putin has been much more consistent on the economy than you might be given to understand by the western coverage. And a lot of his actions that have been portrayed as being geared toward liberalizing the economy and promoting reform, haven’t been that. And on the face of it didn’t look like economic reform, and weren’t economic reform, and were only written about as though they were economic reform.

I think that there are basically two things that his administration was trying to do. One is to get a piece of the pie and that seems very clear and basically what we’re looking at is a very powerful elite was sort of set aside for about 10 years during the 90’s while the pie was being divvied up then get back into power and is really mad about not having shared the wealth and is dead set on getting it hands on a lot of that wealth and has already got it hands on a lot of that wealth and certainly the ways in which members of government and members of the cabinet have meddled in business and have personally assumed ownership of companies, personally interfered in licensing processes for their own benefit was unprecedented even during the Yeltsin era. And I am talking about specific members of the cabinet. The other thing that he is trying to do is fashion a system in Russia including in the economy that is a highly ordered, closed system in which he would be comfortable and that he would understand and so a lot of what we’re seeing is a attempt to restructure the country and restructure the economy so that he feels personally comfortable and it kind of looks like the KGB.

Ambassador Andrey Denisov (Permanent Representative to the United Nations ):

There is a famous short story by Chekov about a wedding ceremony. And there was a wedding ceremony general who was invited for all his decorations. Please dear friends don’t just look at me as a government official. I want to share with you some small points in my personal capacity. You know I live in this country for 52 years. I was born when Stalin was still alive in 1952. I am four days older than Vladimir Putin. Just some perception on what has been said here. First of all, I totally agree with all of those who made the statements here, even with Masha because of what my wife tells me about ò is much more sharp than your statement. She is a very wise woman, clever, much more clever than me. She is a medical doctor, and once when she came back after the presidential elections she said ‘well, I voted for Zhironofsky’. I said you are crazy, she said no, how else can I express my disgust to your power? Vote for the communists? The communists they can do nothing, get 10%, no more, no less. But Zhironofsky, if you, you in general, treat me like he does, then I’ll act like he does and vote for Zhironofsky.

That is a presentation of freedom of thoughts of people in Russia. Because yes, that can be described as some sort of silent society. But nobody wants to go back, nobody wants to end Putin as president of this country. And as an ordinary man, they also don’t want to go back. And what is more important, in the case of Putin, there is a saying, if I’m not mistaken, because I am not an American citizen, that the perception of Putin in my country is the same as the perception of George W. Bush in my country as a human person here in the United States, he is an ordinary man. He is like you and me, like all of us, he has the same problems in his life, the same vision. That is why he is much closer to me personally than many of those who are nice guys, in the Ukraine, but they are more distant.

The following is a summary of the administration official’s reply:

(The question can be answered in two points; the Ukraine and what is the US getting out of the special relationship with Russia.

On Ukraine: With their involvement, Pres. Putin and Moscow raised the stakes of the election far higher than they should have been raised. They have created a false dichotomy. There is little evidence that Yushchenko will act in a dramatically different way than Yanukovych. Whoever becomes president of Ukraine will have to deal with Russia, it is the reality. How much they want to also be involved with the West is a question for the Ukrainian people. Our best way to handle the situation is to continue to stay with our position of a desire for a free and fair election. It is a better approach than to rely on one person.

Regarding the special relationship and what have we gotten from it? There is good cooperation in the areas of counter-terrorism and non-proliferation. Our positions on North Korea are not very different and Russia has been a solid member of the six-party talks. On Iran, some differences remain, but Russia has played a helpful role in dealing with Iran.)

JC: I’ll try to answer that. I don’t think it just Putin who has negative impressions. I think America has suffered a lot from things like Abu Ghrab from the invasion of Iraq. And the fact of the matter is that our standing internationally does depend in part on following certain kinds of rules which we in large part created. And I have no apology in saying that I think this has cost us a great deal. I think similarly some of the things we’ve done in the name of security and post 9/11 have also raised very serious questions in our own country which are played abroad about just where is the line moving between security and, if you will, the rights of the individual. The civil liberties that have been always a fundamental premise. I think those things have damaged our stature. And I can tell you as one who has sat in Moscow’s ambassador trying to explain the 2000 election, that there were not many Russians that were going to be listening to us about how to run an election. Now, you know, this is neither here nor there but it is a fact. And I do think that in the last four years given certain things that have happened, and you can make your own judgements as to whether they were justified or not, it has cost us abroad. I can’t read his mind about how much it effects him this way specifically, but it certainly makes it difficult for us to take certain kinds of positions that we have in the past.

Question: My question is mainly it goes to what ordinary Russians think about the Ukraine and given that the opposition in the street looked a little too well organized to be spontaneous. Would ordinary Russians see this down the road as a model for change in Russia? Or alternatively, would they see it as an attempt by the West to isolate?

James Hoge (Foreign Affairs) — QUESTION:

In our recent election both candidates identified nuclear terrorism as the number one security problem we have to deal with in the immediate future. Now in talking to proliferation experts and so on I get consistently two thoughts coming up. One, we haven’t taken it seriously enough in cutting back funds for theòbut we’ve also run into recalcitrance with the Russians where most of the nuclear material that could be loose and nuclear weapons themselves reside. That they have been tardy, that they have been resistant on grounds of sovereignty and whatnot else, in other words, drawing out the whole process where we see a certain urgency in getting all of this stuff under security. Now you mentioned that this is one area where we have some good cooperation and I just thought that maybe you could elaborate because it’s obviously not what I’m hearing.

Gordon Bardos Harriman Institute, Columbia University):

Since Ambassador Collins brought up everything that was going on in the Balkans during his tenure, I thought I might ask a few questions. No 1. since there is some leftover business from the Kosovo war, mainly defining the status of Kosovo and since final status for Kosovo is going to be put on the agenda next year how much distance there is between the American and Russian positions at this point on the best way to move forward on Kosovo. The second question with regards to this too. Ambassador Collins, you were talking about the impact that certain things that the United States has done in the post 9/11 period the impact that’s had on Russian perceptions of the US. I was just wondering if you had any recollections since Putin came to power very soon after the Kosovo war, did you notice any impact that it had on Putin’s thinking.

Question I guess my question is primarily for (the administration official) although anybody can jump it. You said that we have recognized that Russia has a terrorism problem but that’s a very broad statement. In other words is it the same terrorists. Do we recognize that Chechnya and the war in Chechnya is part of the same battle that we’re fighting in Iraq? And on a more symbolic level, even with all of the emotional horror of 9/11 in New York City, one of the most striking memories is still Putin’s phone call to Bush right after it happened. And it was very symbolic not only on this side but obviously on the Russian side in terms of where good was placing his symbolic capital. This month many people who are involved in the Russia game have made the analogy between Beslan and 9/11 but that’s clearly not being made on this side and there was certainly no equally symbolic reaction on this side of Manhattan.

MG: What do ordinary Russians think about the Ukraine? That’s a very interesting question. It’s the kind of thing where there isn’t a lot of unity even and this is a rare occurrence these days when the country has been so polarized even among certain people I know. There’s clearly a large part of the population that suffers from what we’ve been calling orange envy. Where you just really want to be there and a lot of people have gone and for some people it sort of represents their hopes for what could happen in Russia. And it has been interesting to see not just how the Liberal Democratic opposition figures but also for example Eduard Limonov, who is the leader of the National Bolshevik Party has also jumped on the Orange bandwagon because it represents a real uprising against the sort of Putinite phenomenon. At the same time for a lot of people there is a visceral reaction to this idea that Ukraine could be more influenced by the West. That Russia could lose the Ukraine. There are a lot of people including among very young people who sort of perceive the collapse of the Soviet Union and the loss of the satellite republics as a personal loss and who feel like if the Ukraine goes the way of Yushenko and away from Russia that will also be their personal loss.

JC: Could I just make one point. I think one thing that’s very interesting to think about is the degree to which they think that if the Ukraine were to go West they would face a shagan regime. This idea that somehow there is a wall that requires visas all of the kinds of formalities to get into the EU to travel to Kiev is something that is very visceral, it’s very emotional and probably both ways.

Andrey Denisov:

You see Russia, the Ukraine; it’s like a divorced couple who has to live in one flat, that is the case. There are a very special mixture of different feelings of those people towards each other. We exist in this state of affairs for about 15 years, right now and it is like Israel and there is absolutely no desire of anyone in Russia to Ukraine and not let her go to the West or something like that. No our interest which is quite clear is to let Ukraine survive as normal power, as our neighbor if we have divorced well, we have children, we have to exist together that is the case. /font>

With regard to Kosovo, there is no deep disagreement between the United States and Russia in the case of Kosovo now. There are some discussions within the conflict group, where Europeans play a leading role not the United States. Next year is very crucial in case of Kosovo. Both the United States and Russia acknowledge the supremacy of the Security Council settlement of the Kosovo crisis. Of a resolution 1244 of the Security Council adopted May last year as a basis for that settlement. So I don’t see a big disagreement. Yes, there are some discussions of course. Kosovo in a few words, there are standards and status issues. What is Kosovo? An independent state, an autonomous region within Serbia, or something else? That is a matter of discussion. First should be standards, standards of democracy, standards of rule of law, standards of a multi-ethnic society in Kosovo. Our position is standards first, status next.

The Europeans say well, if we focus on standards then Kosovo population, the Albanian population of Kosovo, will be frustrated will lose the chance for normal development, they will fall into despair. That is why we have to combine; we have to prioritize them, not take all of them, but take main ones, basic democratic values, then make a review of it in the middle of next year. And after that, start discussing status. So there are some major disagreements on what will be first and what will be second, when and how and how to manage, but not in principle.

JC: I personally do believe that we are not doing what we should be doing on non-proliferation on either side. In my experience there are plenty of bureaucratic obstacles that get thrown up largely by the Pentagon on our side, largely by the military and security services on the Russian side that keep things from moving. For instance, one of the huge issues on the disposal of nuclear materials and so forth is liability issues. This is an issue that can be solved. Basically, it is a presidential solution and it will be solved when the president decides it needs to be solved on both sides. And there are issues like this but I think fundamentally I subscribe to the kind of thesis that’s been put out by Graham Ellison and a couple of others that if we are serious about this, this is an issue which has certain things that very concretely can be done and they can be done quickly but it takes serious political leadership to do it and basic decisions at a presidential level to make it happen. Unless you have that it won’t happen, the bureaucracies will resist it. You know why are we fooling around trying to develop a new nuclear weapon for heaven sakes. And by the way, the Russians are probably doing exactly the same thing. The point is there are vested interests that simply have to be brought in to line in order to move forward in any expeditious way. And the pressures are not on them.

The second problem is budgets; frankly, I believe you can learn a lot about what realities and priorities are by budgets. Now it is true that in the relationship when I was ambassador essentially 80% of all the money spent by us, the American taxpayer money on Russia went to national security issues. It was destroying nuclear materials, other kinds of things. So all of this discussion about the huge role of democracy building money needs to be held in proportion it was about 20%. But, at the same time it was no where near the kind of money that was needed in order to make these programs really accelerated to get the work done. I mean this is consequently in both countries a presidential issue. And I think that there is a case to be made that if this relationship really is to produce some tangible, real result in the next four years that’s one area where it can happen. I don’t know whether it will but it’s much more amenable to solutions than many of the other kinds of the more complex issues.

The following is a summary of the administration official’s reply:

(On terrorism in Chechnya and Beslan: After Beslan, Pres. Bush, Dr. Rice and Sec. Powell all expressed their condolences. There is no excuse, no justification for incidents of terrorism such as Beslan.

Chechnya cannot simply be identified with the War on Terrorism, it is a much broader situation. We have tried to make a distinction. There are both domestic and foreign terrorist elements in Chechnya, but many are citizens who feel they have been driven to desperate measures. We have tried to realize there are other issues in play along with terrorism and act accordingly. We have some differences with our Russian colleagues on approach. This may be an area where we simply will disagree.)

JC: I just want to pick up from this to give all of you something perhaps as a thought about thinking today and the future. I was there about a month after Beslan and my sense was that the fallout from this event has been quite profound within the society and within the political class. I think, however, most significantly it is probably very significant in the Kremlin. Because in some sense what Beslan did was to strip away any idea that you had competent authority able to develop an approach and secure the basic safety of citizens and kids in particular. Now for whatever set of reasons, I think it ended any sort of myth that you had a security structure that was effective.

What I think in the wake of all this is that there are two or three things happening. I sense that people are now beginning to say what comes next. We had a certain structure in the first Putin administration; let’s say in the last few years where people more or less understood the structure and who was kind of in charge and how things worked. But, we’re coming up to a new election again presumably or a new choice of leadership in the next two or three years. There are no viable political parties really at this point. You have the traditional structure that is, of course, the president but it seems that even it seems to be fracturing to a degree today. None of the parties so far have been anything but organized from the top down. In other words, they were organized around people or they reflected sort of an ideological approach to building a party. And what you don’t have yet in my view but which I think potentially is going to emerge is parties or political structures that begin to reflect real interests in the country. The question is how those are going to define themselves. No one is really looking at this very much in my view. How is private property going to get represented? Everyone, the business community, the people who now essentially are what we would call the middle class. Where is their political representation going to come from? If you have, as you do, a huge rural population how is that going to get represented? The communist representation of it always made no sense to me, but it nevertheless was there, what’s going to happen now? And I think that we are headed into a period of rather significant fluidity in the system where you’re going to have new voices, or where one may hope to see new voices, begin to try to emerge. I think Khodorkovsky was, in some sense, was the tip of an iceberg. He came too early; he tried to do things prematurely perhaps. But
there’s going to be something emerging.

The final point I’d like to make is that everybody is moving through the age process. People who are in charge now, 10 years from now will be passing from the scene. You’re going to get a new group. Who are they? Are they going to represent themselves differently, and be structured in different ways? I think these are the really profound questions that are in front of us. And to some extent, things like Ukraine, the emergence or the successive failure of the direction the economy takes, that kind will have a big effect on how this plays itself out.

NK: Thank you very much. That just defined the talk for our next discussion. Thank you very much for coming from Washington DC, and from Moscow. Thank you all for coming. I would like to recognize Ed Hancox for helping and Alla Rachkov from the Harriman Institute for helping as well.

Transcript prepared by Edward Hancox, Project Associate.



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