Realism about Russia.

• Author: Odom, William E.

REACTING TO THE Bush Administration's promise of "realism" in dealing with Russia, a former Clinton Administration official observed that "the issue is what is reality."' Indeed it is.

Clinton Administration officials had their reality: Russia was on the path to liberal democracy; albeit stumbling occasionally; it was building the institutions for an effective market economy, although suffering periodic setbacks; its large arsenal of nuclear weapons entitled it to major power status, but at the same time the United States could help to reduce significantly the number of operational Russian warheads and to improve the security of Russian nuclear weapons and materials. This assessment prompted the Clinton Administration to believe that Russia could be induced to play a constructive role in the Balkans, with NATO, in Iran, and elsewhere.

The Clinton reality also implied alternative futures, partly depending on U.S. policy choices. Although never voiced as an official view, defenders of the Clinton policy outside the administration emphasized that Russia's progress toward liberal democracy and economic recovery required constant U.S. support, both with technical assistance and by encouraging generous IMF and World Bank loans on relatively easy terms. If such support were not provided, it was intimated, a "redbrown" Russian dictatorship would emerge, analogous to Weimar Germany's transformation into Hitler's Third Reich. The assumption in either case was that Russia would soon return to the ranks of the great powers, and prudence dictated making an effort to avoid getting on Moscow's future enemy list. If one accepts this line of reasoning, then it can be claimed that the Clinton Administration's assistance programs to Russia made political sense despite their questionable economic results.

What different reality might the Bush Administration see if it takes an unvarnished view of contemporary Russian realities? It will see a Russia that has indeed become a "normal country", which is to say a member of that large majority of states in the world that are weak, poor, and ambling along their own paths headed nowhere in particular- certainly not to liberal democracy or effective market economies. It will also see that the security of Russia's nuclear arsenal is beyond significant U.S. influence but, nonetheless, that nuclear weapons do not make Russia a great power. It will see that Russia can engage in trouble-making diplomacy in the former Soviet republics along its periphery, but that it is not capable of major military operations.

More broadly, it will also see that Russia cannot be expected to act constructively in international affairs because most of its elite class angrily blames the West for Russia's drop to third rank status--although the real culprit is the legacy of seven decades of Soviet rule. Western magnanimity cannot change Russia's foreign policy behavior for the better; it is far more likely to make it worse. Moreover, Russia as a "normal country" in this special sense of the term may remain in a sharply reduced condition for a very long time. It is liable to become, in Jeffrey Tayler's colorful phrase, "Zaire with permafrost." [2]

What if we were reasonably certain that Russia will not soon return to great power status, either as a liberal democracy or a dictatorship? What if we knew that no amount of aid and assistance will produce a dynamic and effective Russian economy? What if, in other words, Russia simply cannot "make it", with Western help or without it? What is the evidence for this possibility, and what would be the implications for U.S. policy?

Russia's Institutional Deficit

FORMALLY speaking, of course, Russia is "making it" to democracy in the sense that it holds periodic elections in which opposition parties participate--as long as their chances of winning are scant. Russia has not yet, however, seen an incumbent president voted out of office. If "making it" means achieving "liberal" democracy, then evidence accumulates that Russia is not making it and may not do so for many decades.

Its formal democracy notwithstanding, Russia lacks genuine constitutionalism. A true constitutional system requires a durable elite consensus on: rules for making rules; rules for deciding who rules; and individual rights that no ruler can violate or abridge. Russia is developing no such consensus. President Vladimir Putin's carefully managed succession to President Boris Yeltsin made clear to all but the most obtuse observers that a genuine breakthrough for constitutionalism in Russia is not about to happen. Most of Putin's key programs--taking all effective political power away from the Federation Council (the upper chamber of the parliament); imposing a new administrative level over the regional governments; conducting a genocidal war in Chechnya; and methodically reducing media freedoms--appear to violate the Yeltsin constitution of 1993, calling to mind the Russian proverb that "paper will put up with anything written on it."

The unreconstructed optimist will object, insisting that all this signifies merely a temporary setback on a difficult road, a claim frequently made by Clinton Administration officials as well as numerous analysts and scholars in think tanks and universities. In truth, however, Russia is on some other road altogether, and this truth really should not surprise us.

If in 1992 one had taken the best theories available on how liberal democracies come to be, and what kind of state institutions are required for effective economic performance, one would have known that Russia's chances of taking the liberal path were poor. After a decade of post-Soviet experience, one should now conclude that the chances are trivial to none, barring a major dislocating shock such as a major war or revolution, or the very improbable emergence of the kind of elite consensus that produced the Meiji restoration in Japan. Russia is now locked into a mix of old and new institutions that daily becomes more costly for the Russian elite to escape than to perpetuate. This predicament is neither unusual nor abnormal; most countries are tapped in the "weak state" syndrome and locked into economically ineffective institutions. Abnormal counties are the wealthy liberal democracies located almost exclusively in North America, western Europe, and a few rim-land states in Northeast Asia.

Political theory, and not just Russia's experience, supports these observations. It does so by clarifying the link between political institutions and economic performance.

Clearly, all liberal democracies have market economies where, despite sometimes large welfare programs, prices are set largely by supply and demand. But the reverse is not true; not all market economies exist within a liberal democracy. Indeed, the rim-land economies in Asia, some of their leaders have insisted, perform well precisely because they do not have liberal democratic governments. Thus, the connection between good economic performance and liberal political institutions has been a disputed one, and the mixed empirical evidence allows disparate views their day.

Mainsteam Western economists have shed little empirical light on these disputes, preferring instead the many simplifying theoretical assumptions of neoclassical economics. This is why individual Western advisors to the Russian government in 1992-93, including officials of the IMF and World Bank, ignored such complications. Ironically, the winner of the Nobel Prize for economics in 1993, Douglass C. North, who had...