Russia: Consider the Alternative : Does the West really want an authoritarian and nationalist power?

Providing direct aid to Russia as it tries to grope its way toward a market economy has never had an enthusiastic constituency in the industrialized world. It’s a sound idea and all that, political leaders agree, but not one worth many votes in their own countries and thus not one worth risking a lot of political capital on.

Two months ago the foreign and finance ministers of the Group of Seven considered the U.S. notion of setting up a $4-billion fund to privatize Russia’s state-owned enterprises and help start-up companies. Half of that was to come from the G-7, half from banks. The hope, at least in Washington, was that the G-7--the United States, Britain, France, Italy, Canada, Germany and Japan--would give final approval to the idea at their heads-of-government conference in Tokyo next month. It’s clear now that this is not to be. Resistance, especially from Japan, is likely to see the proposal cut to about half of its original size.

One major reason for the reluctance to commit to a large new aid package for Russia is that the worldwide recession has left the industrialized countries with little to spare in the way of aid funds, even for their traditional clients.

Another major reason is serious doubts about Russian President Boris N. Yeltsin’s ability to carry through on projected economic reforms, given the continuing political opposition and social inertia that he faces. Finally, Russia’s own recent actions in selling high-technology military ware and rocket fuel to a number of countries whose behavior and motives are dubious at best--Iran and Libya among them--have not worked to encourage confidence among the donor countries. Friction on this issue led Russian Prime Minister Viktor S. Chernomyrdin to cancel a trip to Washington last week.

All of these reasons have respectable political or economic arguments behind them. But so does the case for the industrialized countries to act soon and effectively to help encourage the transformation of Russia’s costly and enormously inefficient state enterprises into privately owned, profit-oriented companies that can contribute to national economic growth. In Washington last week former Prime Minister Yegor Gaidar, one of Russia’s leading advocates of free-market reforms, cited the privatization fund as the single most important type of aid the West could give.

No amount of outside aid can guarantee Russia’s transformation into a fully democratic, free-enterprise state. But a moderate level of aid clearly is called for if that process and those who have fostered it are to have a chance to succeed. The likely alternative--a Russia controlled by authoritarian and inward-looking nationalists--is something that would be sure to raise security costs for all of the G-7 countries. That danger should be carefully considered at next month’s Tokyo summit.