Talbott Taking the Fall for Russia’s Ills

When the history of the Clinton administration’s foreign policy is written, the most tragic figure may well be Deputy Secretary of State Strobe Talbott.

For nearly six years now, Talbott has been President Clinton’s point man in dealing with Russia. He is well connected; Talbott has been the president’s friend since the two were Rhodes scholars together. He is knowledgeable; he was Time magazine’s specialist on Russia and its Washington bureau chief. He is also decent, sincere and hard-working.

Yet the American policy on Russia for which Talbott has been the driving figure crashed and shattered on Aug. 17. That was the day when Russia’s economy fell apart, and so did the reform-minded leadership that the Clinton administration had sought to nurture.

With foreign capital fleeing the country and the banking system insolvent, the Russian government was forced to devalue the ruble, making imported goods prohibitively expensive. It also defaulted on some of Russia’s debt, making future foreign investment all but impossible to attract.

Within a few days, Prime Minister Sergei Kiriyenko and other leading reformers in his government resigned, giving way to successors, including current Prime Minister Yevgeny Primakov, who are far less committed to economic liberalization.

It was the end of an era, the seven-year period from 1991 to 1998 in which leaders in Moscow sought to push the Russian economy toward free markets and to integrate it ever more closely with the West. Now Russia is behaving in a way that sometimes invites comparisons with Germany’s post-World War I government, the Weimar Republic.

Inside Russia, conspiracy theories abound. Russians look for scapegoats: They blame the West, the International Monetary Fund and Russian economic reformers for impoverishing the country. Most ominously, anti-Semitism is rearing its head in Russia once again.

Outside Russia, experts debate all sorts of dire scenarios. Some intelligence specialists think Russia is in the midst of a new round in its historic cycle of deterioration and fragmentation that will end only when some Russian leader, probably a military figure, reassembles the country by force.

It would be unfair to say that these recent events occurred because of Talbott’s policies. Even in the 1990s, America doesn’t begin to wield that sort of influence over Russia. There were larger factors at work: The collapse of oil prices and the Asian financial crisis both damaged Russia’s economy.

Nevertheless, the effect was to devastate the cause of Russian reform, which the Clinton administration had tried to support. As a result, you can already see signs that Russia may once again become a political issue in the United States.

“We have suffered a huge defeat for U.S. foreign policy,” Condoleeza Rice, who was President Bush’s advisor on Russia, told Forbes magazine last month. Rice announced last week she would step down from her job as provost of Stanford University; she is widely expected to become an advisor to the Republican presidential campaign of Texas Gov. George W. Bush.

Undeterred, Talbott labors on. He was in Moscow last week, along with Deputy Treasury Secretary Lawrence Summers, seeing whether Primakov’s government might put together an economic program strong and tough enough to qualify for further IMF aid.

Recently, Talbott has come up with a new rationalization for the U.S. policy. In a speech at Stanford last month and in an article in the Economist expanding upon it, the deputy secretary of State tells us that everything is still OK in Russia. He urges America to be patient. “Over time, the tug of the Soviet experience will weaken,” he says. “That process will just take a generation or more.”

This sounds nice, but it seems out of touch with Russia’s economic and political realities. The most devastating critique of Talbott thinking comes from two scholars, Clifford G. Gaddy of the Brookings Institution and Penn State University professor Barry W. Ickes, who studied how the Russian economy is working not in Moscow but in the cities and towns outside it.

In a trenchant essay called “Russia’s Virtual Economy” in Foreign Affairs magazine, they challenge the very premises of American policy. “Most of the Russian economy has not been making progress toward the market or even marking time,” they write. “It is actively moving in the other direction.”

The implications of their detailed study run contrary to Talbott’s optimism. Their work suggests that time is not on the side of the reformers. Russia’s younger generation is no more committed to a market economy than was the older one. Young people, too, profit from the jerry-built system Russia has evolved to protect its industries from the market.

Indeed, Talbott’s notion that Russia’s problems are generational has an oddly familiar ring. About 30 years ago, when Clinton and Talbott (and this writer) were in college, this idea was a recurrent theme in the U.S. opposition to the Vietnam War. The old people in Washington messed up, it was said; wait until the younger generation takes over.

But the American failure in Vietnam was one of policy, strategy and institutions, not a generational failure. And the same can be said about Russia today.

“We believe that gloom and doom are no more justified now than was euphoria a few years ago,” Talbott asserts in his article. But given what’s happening in Russia now, gloom seems to be the only rational response.

Jim Mann’s column appears in this space every Wednesday.