WORLD REPORT EXTRA: The Coup and...

“Break out the champagne!” a haggard official at the State Department’s Soviet Desk crowed as this week’s abortive coup d’etat in Moscow collapsed. “We won!”

For Bush Administration officials, the triumph of Boris N. Yeltsin and his democratic supporters wasn’t just a welcome victory for the cause of reform in the Soviet Union; it opened the real possibility of a major new improvement in U.S.-Soviet relations.

Ever since Mikhail S. Gorbachev came to power in Moscow in 1985, his impulse to improve relations with the West has been restrained--if only at the edges--by rear-guard resistance from Communist Party conservatives and hard-line military officers.

The Old Guard kept Soviet aid flowing to Cuba and Afghanistan, kept the Soviet defense budget high and caused a brief crisis in East-West relations by violating the terms of the 1990 treaty on reducing conventional armed forces in Europe.

But now, that Old Guard is on the way out--the victim of its own miscalculations in attempting to overthrow Gorbachev.

The new Soviet government that emerges from the political bargaining of the next few months is likely to be more solidly committed to the kinds of reforms that the Bush Administration has demanded as the price of direct economic aid from the West.

And U.S. officials say President Bush’s actions to marshal visible Western moral support for Yeltsin and Gorbachev during this week’s crisis made it vividly clear to Soviet reformers that their firm alliance with the West is important--even crucial--to their success at home.

The turnabout from the bleak prospects at the beginning of the week--when U.S. policy-makers awoke to the possibility of a renewed Cold War that could instantly erase many of the improvements of Gorbachev’s rule--could not have been more striking.

“We stared a monster in the face for three days,” recalls Deputy Secretary of State Lawrence S. Eagleburger. “It was a return to a neo-Stalinist Soviet Union, and we saw what that would be like. . . . I think now, with the return of Mr. Gorbachev, we’re back on track again.”

“The collapse of the coup should clearly strengthen the trends we have already seen in Moscow . . . toward better relations with the West,” a senior U.S. government analyst says. “It will reduce the (Soviet) military’s argument for bigger budgets. It will reduce the military’s ability to futz around with arms control agreements.

“Support for Cuba will decline, because the constellation of forces that support the Cuban-Soviet relationship has taken a tremendous blow. Support for (the Communist regime in) Afghanistan will decline too.

“The pressures for reducing cooperation with the West have gone way down, because the people who were applying that pressure, the Old Guard, are on their way to jail or at least are about to lose their jobs.”

By the same token, conservatives in the West who argued for caution in cooperating with the Soviet Union have lost one of the basic pillars of their argument,too.

“What has really held us back is what people like (Deputy National Security Adviser Robert M.) Gates and (Defense Secretary Dick) Cheney have been saying--that this reform program may not work, that the Old Guard may take over again,” said William Hyland, a Soviet expert and editor of the quarterly Foreign Affairs. “Well, the great bogyman has now been exorcised. There’s no Old Guard to take over anymore.”

As a result, the debate in the United States and Western Europe over economic aid to the Soviet Union has already shifted ground, with a sudden surge in political support for assistance to help Yeltsin and other reformers to consolidate their power.

“The cautious approach the Administration has taken so far was prudent in the light of the uncertainties at the time,” Hyland said. “But now most of the uncertainties are disappearing, and we have to put up some real money. Up to now, we’ve been waiting to see whether they would have a real reform before committing any aid. Now we’re going to have to reverse those priorities and offer aid without waiting for the reform to happen first.

“We ought to use the next hundred days to work out a program of real help,” Hyland asserted.

The Administration remained publicly cautious about increased aid late last week, even though several senior officials conceded that the political pressures for offering economic assistance to Moscow had clearly surged. “It’s going to be awfully hard not to,” one said.

“The Administration’s position is not likely to change in the sense that if economic reform--serious economic reform--is undertaken, we will help,” Eagleburger said in an interview on ABC television. “But if they don’t go forward with those reforms, giving them money and assistance isn’t going to do anything but put off the day of reckoning.”

Other aides said the Administration has already been discussing a major increase in aid, including possible food shipments to help the Soviet people through the coming winter. “They’re going to have a short harvest, and there may well be serious shortages,” one government analyst noted.

As Eagleburger noted, Bush and his aides haven’t changed their conditions for increased aid to Moscow--a clearer commitment to economic reform as well as political moves such as an end to Soviet support for Cuba.

But after five years of halfway economic reforms under a hesitant Gorbachev, the abortive coup has strengthened the political hand of Yeltsin and others who have demanded more thoroughgoing reforms.

“(The coup) may remove some of the constraints which Gorbachev felt,” a senior Administration official said. “Remember, one of the architects of going slow . . . was the prime minister, Pavlov, who is now in jail. And so I think you can anticipate that there has been a release from the kind of constraints that the conservatives generally were saying--’Hey, go slow. Don’t move fast to free markets.’ ”

“As Yeltsin’s power increases, it becomes more likely that he will be able to implement some of these economic reforms,” another official said. “The political legitimacy he’s gained gives him a window to push hard. Until now, (the reformers) have been reluctant to inflict economic pain on the populace because it would leave them vulnerable to attack from the right. They don’t have that problem anymore.”

Moreover, Bush’s decision early in the week to throw his full support to Yeltsin and the other democratic leaders should make increased cooperation easier as power in the Soviet Union continues to shift from Gorbachev’s central government to the 15 Soviet republics. Yeltsin spearheaded resistance to the coup from his position as the elected president of the Russian Federation, the largest of the Soviet republics.

Bush, speaking with a hint of pride in his voice, made a point at a press conference Wednesday of quoting Yeltsin as saying that the U.S. effort in marshaling Western support for Soviet democrats had significantly helped in defeating the coup.

“He thanked the United States profusely for its support, which was making an important difference,” Bush said.

The new Bush-Yeltsin relationship, forged through a series of telephone calls between Kennebunkport and the Russian leader’s besieged headquarters in Moscow, may also have helped the Administration make a difficult transition--from an exclusive focus on Gorbachev as its partner in ending the Cold War to a more diverse set of contacts with the new reformists who, like Yeltsin, are challenging Gorbachev’s authority.

Bush said he still hopes to deal cordially with both levels of government in the new Soviet Union. “They’ve got to sort out some internal problems,” he said. “But I explained to (Gorbachev), as I have told Yeltsin, that we are ready to talk to the leaders of the republics and certainly we will be ready to talk and deal with the president of the Soviet Union itself.”

Even before the abortive coup, the Administration slowly broadened its dealings with the reformers to Gorbachev’s left. Bush met one-on-one with Yeltsin during his summit visit to Moscow last month, and Secretary of State James A. Baker III has quietly maintained close contacts with former Foreign Minister Eduard A. Shevardnadze, the leader of a new democratic political party.

But completing that shift will not be easy, for Yeltsin and his allies will inevitably come into conflict with Gorbachev over matters of both power and policy, U.S. officials predict.

The first crisis point may well be the three rebellious Baltic republics--Estonia, Latvia and Lithuania. Yeltsin has supported the republics’ demands for immediate independence. Gorbachev has resisted their secession, insisting that they must wait until a constitution is adopted and then must undergo lengthy negotiations with Moscow. The Bush Administration has straddled the fence, declaring itself in favor of Baltic independence in principle, but supporting Gorbachev’s go-slow policy in practice.

“What’s happened in Moscow is going to accelerate the independence of the Baltics very quickly,” Hyland predicted. “Within three months, those three countries will either be independent or all-but-independent.”

That will require deft footwork on the part of the Bush Administration and its European allies, for the West wants to make sure that the secession of the Baltic states occurs without touching off international conflicts, civil wars or the sudden--and dangerous--disintegration of the entire Soviet Union.

“I don’t think we’re ready for it,” one Administration official confessed. “I haven’t seen any evidence of the kind of rethinking that our policies need in the face of this radical change.”

And over the long run, one senior official warned, the Administration may face another ticklish problem: Even with the friendliest possible regime in power in Moscow, the United States and the Soviet Union are likely to find themselves at loggerheads some of the time.

“The Soviet Union--or its successor states--have a geographical position that’s different from ours, an economic situation that’s different from ours, and they may very well define their national interest as being different from ours,” he said. “That doesn’t mean they will be hostile. That doesn’t mean they will oppose whatever we want. But it does mean we can’t count on them supporting everything we want, because they may, quite legitimately, want something different.”

In the short run, the official forecasts, the aftermath of the abortive coup promises a renewal of U.S.-Soviet cooperation in areas where joint projects were already under way--in arms control, in reducing political tensions in Europe, in convening an Arab-Israeli peace conference, in bringing peace to Afghanistan and Cambodia.

But in the longer run, he notes, “We’re going to discover some new issues where we disagree, as well. . . . That will be an important part of defining a new kind of relationship.”