Reports & Papers
BCSIA: 1998-1999 ANNUAL REPORT
6. Strengthening Democratic Instituitions Project
CORE STAFF
Graham T. Allison, Jr., Director
Fiona Hill, Associate Director
Stefan Zhurek, Executive Director, Moscow Initiatives
Melissa Carr, Administrative Coordinator
Henry Hale, Research Associate
Ben Dunlap, Research Assistant
Cameron Half, Research Assistant
Elena Kostritsyna, Staff/Research Assistant
Vladimir Boxer, Fellow
BACKGROUND
The Strengthening Democratic Institutions Project (SDI) was created at the John F. Kennedy School of Government in 1990 by Graham Allison and David Hamburg, President of Carnegie Corporation of New York, to catalyze Western support for the political and economic transformation of the Soviet Union. The project became part of the Belfer Center for Science and International Affairs in 1995 when Dr. Allison was appointed Director of the Center.
SDI was the first independent Western research and technical assistance project to establish itself on the ground in Moscow. It continues to actively engage Russian counterparts and encourage other Western independent and governmental actors to become involved in the post-Soviet transition. The project undertook the following initiatives from 1990 to 1998:
- Developing the basic framework for Western economic assistance to the Soviet Union and then to Russia as its largest successor state. This framework was later adapted and implemented in the successive International Monetary Fund programs for Russia.
Drawing attention to the Russo-Japanese dispute over the Northern Territories and urging a resolution that would facilitate substantial Japanese financial support for Russia''s economic reform.
Promoting Western support for the drafting of a new Russian constitution and for the development of a professional and independent press.
Analyzing the phenomenon of ethno-political conflict in the former Soviet Union.
Proposing a strategy for eliminating nuclear arsenals in Ukraine, Kazakstan, and Belarus.
Encouraging a reevaluation of the relationship between Russia and the former Soviet republics and promoting active Western engagement of Ukraine and other key states.
Monitoring and analyzing conflicts in Chechnya and the Russian North Caucasus.
Providing technical support for the development of Russian political parties and in-depth commentary on the 1995-96 series of Russian parliamentary and presidential elections.
Creating a special executive program for high-level officials from the government of Kazakstan on national performance, strategy, and organization.
Offering high-level fora for discussions of crucial issues related to the transformation of the Russian agribusiness sector, and the promotion of Western investment in Russia.
Assisting in the creation of a functioning mortgage market for Moscow and other regions of the Russian Federation.
Highlighting the prospects for and complications associated with the development of petroleum resources in the Caspian Sea.RESEARCH AND POLICY OUTREACH
Activity for 1998-99 focused on four major research and technical assistance projects.
Sustaining Russian Democratization, which stresses research and analysis on Russian politics, partybuilding, parliamentary behavior and party organization, the emergence of new political elites, the development of inter-elite relationships in Russia, and the 1999-2000 parliamentary and presidential elections.
The U.S.-Russian Investment Symposium, which focuses on the single largest challenge for the Russian economy in the decade ahead - attracting private-sector international direct and equity investment - and reviews the Russian economic and business climate, and opportunities and obstacles for Western investment in the Russian Federation.
The Russian Middle-Class Mortgage Initiative, which addresses a cluster of issues at the top of the agenda of Russia''s economic marketization and also its political pluralization and stabilization - including a persistent housing crisis and the creation of a middle class of small property owners.
The Caspian Initiative, which seeks to understand and advance U.S. political, economic, and security interests in the Caspian Basin by avoiding confrontation with Russia and promoting the interests of the regional states.
I. SUSTAINING RUSSIAN DEMOCRATIZATION
In the drama of Russian democratization, Russia has reached a first, significant plateau in establishing the legitimacy of competitive elections. The essentially free election of the Duma in December 1995; the president in June 1996; gubernatorial elections across the 89 subjects of the federation; and election of regional and city Dumas that have taken power as a result of electoral victories is something many observers of Russia and the former Soviet Union asserted would never happen. Russia still faces equally steep and difficult tests, however, in moving to a more stable democracy. Immediately ahead lie three major tests: (1) elections for a new Duma in December 1999; (2) elections for a new president in July 2000 in what promises to be the first peaceful democratic transfer of power in Russia''s 1,000-year history; and (3) a continuing struggle over the electoral "rules of the game" under which these elections will be held.
Democratic institutions remain weak. As outside observers have concluded over the last several years, the Russian State Duma has yet to exercise its legislative functions fully, and Russian political parties are, for the most part, little more than parliamentary factions centered around a few prominent individuals. As a normal democratic institution, the Russian Duma however, plays an important role as a counterweight to the presidency and executive - preventing one-man rule in Russia. The 1999-2000 elections will be critical in stabilizing the Duma and in promoting the coalescence of political parties. In response, under the auspices of a grant from Carnegie Corporation of New York, SDI stressed research and analysis of Russian politics and initiatives that follow the activity of parties and significant individuals as they prepare for the 1999-2000 parliamentary and presidential election cycle.
Visit by Boris Brevnov
As part of this activity, on September 7-21, 1998, Boris Brevnov, one of a group of young Russian reformers from Nizhny Novgorod, was resident at the Belfer Center as an SDI Visiting Fellow. From May 1997 until April 1998, Brevnov was Chief Executive Officer (CEO) of United Energy Systems (UES), Russia''s largest company and the world''s largest energy power utility. SDI Associate Director Fiona Hill first approached Brevnov in June 1998 with the proposition that he visit the Kennedy School to collaborate on the production of a case study on his experiences at UES and the political, economic, and social problems of restructuring monopolies in Russia, as well as to participate in seminars and meetings with groups at Harvard engaged in activities related to Russia''s economic and political transition.
The period of Brevnov''s tenure as an SDI Visiting Fellow coincided with the economic and political crisis in Russia following the devaluation of the ruble on August 17, 1998, the collapse of Russia''s banking system, and the subsequent default on its foreign debt. During his time at the Kennedy School, Brevnov in addition to beginning work on the case study with SDI Research Assistant Cameron Half, participated in a number of seminars at the Belfer Center and the Davis Center for Russian Studies on Russia''s economic crisis, including a presentation on "Russia''s Challenges" to a BCSIA Director''s luncheon on September 17, 1998.
In his presentation, Brevnov argued that Russia was suffering not from a financial crisis, but from a managerial crisis. He claimed that Russia''s greatest challenge since 1991 has been learning how to manage its abundance of resources effectively and suggested that Russia and the West need to work together to develop effective systems of leadership, management, and governance, in order to utilize these resources efficiently. Brevnov applied his observations of the situation at UES to the Russian economy as a whole. In response to those who might question the possibility of exercising effective management in Russia - given the poorly developed legal infrastructure, pervasive corruption, and other obstacles - Brevnov cited his own accomplishments with UES as an example of what effective management could accomplish. He noted that he had increased cash collection from 5 percent of total revenue to 30 percent, and while he was CEO the company''s market capitalization had increased from $5 billion to $18 billion.
In discussing foreign influence on the process of business-sector reform and restructuring, Brevnov criticized U.S. policy toward Russia, which he described as based on "bringing and spending money," rather than establishing the firm foundation of property rights and the accompanying incentives and opportunities for responsible management and government that have promoted successful businesses in the United States. He similarly faulted the International Monetary Fund (IMF) and the World Bank for not doing enough to promote business in Russia. These organizations, he argued, have repeatedly issued loans to fund the federal government''s budget deficit while clamoring for tax and other economic reforms. In doing so, according to Brevnov, they have failed to provide adequate support and encouragement for building a new legal and political culture capable of leading Russia to prosperity and generating an active, entrepreneurial class. Thus, he pointed out, many Russians have become justifiably frustrated with Western governments that have given billions of dollars to Russia with no apparent results.
Despite the challenges facing Russia today, Brevnov remained optimistic about Russia''s future prospects, noting that "in times of crisis it is one''s patriotic duty to be an optimist." He asserted, however, that one could not minimize the risks to both economic and political development associated with the current lack of leadership in Russia. Nevertheless, he concluded that Russia presents tremendous opportunities for those who understand the context there and are willing and able to take an active role in managing their investments.
The case study of Brevnov''s attempts to reform UES as a microcosm of the Russian economic reform and restructuring process was completed and published as an SDI occasional paper in September 1999.
Visit by Grigory Yavlinsky
On December 12-17, 1998, SDI was honored to host Grigory Yavlinsky at Harvard and to organize a series of meetings for him with key government officials and U.S. media representatives in New York and Washington. Yavlinsky is the leader of the Yabloko Party, a 1996 Russian presidential candidate, and Russia''s leading liberal reformist politician. At Harvard, Yavlinsky spoke to an overflow audience at the ARCO Forum for Public Affairs on "Who Lost Russia? What Is to Be Done Now?" discussing the need for Russia to move ahead with a concrete plan of reform.
In his presentation, Yavlinsky noted Russia''s experience of the last seven years produced three main lessons: (1) the reform program was oversimplified, focusing on only three preconditions - low inflation, a stable exchange rate, and the maintenance of Boris Yeltsin''s presidency - to establish a base for a market economy rather than tackling a broad range of structural reforms, including demonopolization and trade liberalization; (2) economic reform without political reform leads to chaos; and (3) there can be no market reforms without the people''s confidence in the government. Taking these lessons into account, Yavlinsky proposed a seven-point economic program for the next five to ten-year period, including: (1) tax reform; (2) bankruptcy laws; (3) land reform; (4) banking reform; (5) protection of investors; (6) debt restructuring; and (7) pension reform. He argued that the implementation of this economic program must be accompanied by corresponding political reforms and that the most pressing political need was a change of the leadership at the top, with other key political requirements including: (1) a new Russian parliament (Duma), free from Communist domination; (2) the bolstering of civil society; (3) the development of political parties; 4) an increase in parliamentary powers; (5) the overhaul of the judicial system; and (6) constitutional reform, especially with regard to the imposition of limits on the powers of the president.
At a smaller gathering of Harvard economists and Russia specialists at Harvard''s Faculty Club, Yavlinsky continued a long-standing debate, sponsored by SDI, with Harvard Economics Professor Andrei Shleifer about the development of a market economy in Russia and illusions in the West about the success of reform. Yavlinsky repeated the points outlined in his presentation at the ARCO Forum and asserted that after the August 17, 1998, devaluation of the ruble and default on Western loans, and the ensuing economic and political crisis in Russia, he no longer had to convince anyone that Russia''s reform program of the last seven years had failed. "Now is a different time," he said. "Now we can focus not only on proving what is wrong, but on what must be done." In addition to the seven-point plan outlined above, Yavlinsky advocated four further steps: (1) limiting the power of monopolies and making natural monopolies in Russia accountable to the public, especially in the energy sector; (2) developing competition in the Russian economy and working to help small and medium-sized businesses; (3) ensuring communication between the federal government and the regions; and (4) encouraging the Russian people to put their money back into the domestic economy - according to Yavlinsky''s estimates, the Russian people have about $60 billion hidden in Russia and another $120 billion in savings abroad.
Shleifer offered specific comments on the individual elements of Yavlinsky''s economic program, and argued that although Russia still faced many problems and had developed a distorted form of capitalism, this was not a result of the reform process, but rather a description of the conditions one should expect in Russia. Shleifer pointed out that if one looked not only at Russia, but also at other countries that shared its characteristics, it was clear that Russia was not unusual. When compared with these other countries - in Asia and Latin America - Russia was no more corrupt and no less well off. Shleifer concluded that Yavlinsky''s prescription for Russia applied to any country in the world with the same conditions.
Fact-finding Trip to Russia
In preparation for the 1999-2000 Russian election cycle, SDI Research Associate Henry Hale traveled to Russia in the spring of 1999, where he spent two and a half months conducting intensive field research on the process of political party formation in Russia, and teaching foreign policy at a Russian university. Based in St. Petersburg but traveling frequently to Moscow, Hale met with top party officials involved in the party-building process at the Russian federal level and visited three additional Russian regions (Bashkortorstan, Perm, and Pskov) to interview the local leaders of almost all major parties as well as political analysts and regional government officials.
Hale also used this time to further relationships with key SDI partners, with whom the project collaborates on its initiatives in Russia, including Moscow representatives from Western organizations such as the National Democratic Institute, the International Republican Institute, the International Foundation for Electoral Systems, and the Carnegie Endowment for International Peace; and Russian institutes such as the Moscow School of Political Studies, the Russian Institute for Political Studies, the "Reforma Foundation," the Russian Public Policy Center, and the Moscow Public Science Foundation.
As a result of his field research, meetings, and discussions, Hale concluded that Russian political leaders often know what they need to do to build strong political parties, but they are held back by a lack of resources, internal political concerns, and even strategic considerations. These conclusions have had a direct impact on the initiatives that SDI has proposed for its 1999-2000 Russian Political Party-Building Program.
Russian Political Party-Building Program
Since 1994, SDI has worked directly with the leadership of the principal democratic, reformist parties on partybuilding at the local level through its Russian Political Party-Building Program, and has sought to maintain active relations with all major political movements in Russia regardless of ideology. To complement other programs that rely primarily on sending Western experts to Russia to address party building and campaigning issues, its Party-Building Program has emphasized bringing small groups of top Russian political party leaders to the United States to observe Western experiences firsthand, allowing them to meet American counterparts as equals and to reflect on their own experiences and needs from a distance.
With the assistance of a new grant from the Charles Stewart Mott Foundation, SDI was able to continue this venture in 1999, beginning with a program for Russia''s leading liberal movement, Grigory Yavlinsky''s Yabloko Party. Based on SDI Director Graham Allison''s bilateral meetings with Yavlinsky, and Henry Hale''s consultations with Yabloko Party officials during his extended trip to Russia in the spring of 1999, SDI tailored a program to address Yabloko''s needs in the field of training campaign pollsters. On August 8-15, 1999, the program brought three of Yabloko''s top pollsters to the United States for a series of meetings with high-level U.S. party pollsters and campaign strategists, including political consultant, former Democratic Party strategist, and former Taubman Center for State and Local Government Executive Director for External Affairs Nick Mitropoulos; Republican pollster and former Kennedy School Institute of Politics Fellow Chris Henick; and Democratic Party campaign strategist John Marttila. In addition to meetings at Harvard and in Washington, D.C., the program included a visit to Iowa to witness American democracy in action during the state''s straw poll for the 2000 U.S. presidential race. Analogous tailor-made programs were crafted for the Fatherland movement and General Alexander Lebed''s party for the fall of 1999.
Moscow School of Political Studies
In conjunction with these efforts, SDI continued its long-term assistance to the Moscow School of Political Studies, headed by Elena Nemirovskaya. The Moscow School was established in 1992 to train young Russian politicians in democracy and international relations and to give them an opportunity to meet with international experts from the United States and Western Europe in these areas. The Moscow School has become the leading political training school in Russia. Each year it exposes a diverse group of young, talented leaders from the State Duma, Russia''s regional legislatures, the media, and business to concepts of democracy, civil society, and citizenship. SDI is the primary source of American experts for the School''s seminars in Moscow and sites in southern Russia, the Urals, and Siberia. SDI Director Graham Allison has attended and presented at the School''s May seminar at Golitsyno outside Moscow for the last several years.
In spring 1999, following meetings among SDI Associate Director Fiona Hill, Research Associate Henry Hale, and Moscow School Director Elena Nemirovskaya, in Moscow, SDI secured a group of U.S. experts to attend the School as lecturers. The group included Graham Allison, Harold Berman of Emory University''s School of Law, Thomas Graham of the Carnegie Endowment for International Peace; Richard Perle of the American Enterprise Institute; Richard Pipes of Harvard University''s History Department; Richard Neustadt and Shirley Williams of the Kennedy School of Government; and David Beasley and Barbara Barrett of the Kennedy School''s Institute of Politics. SDI specifically sponsored the presentations of David Beasley, the former Governor of South Carolina, and Barbara Barrett, Executive Vice President of the International Women''s Forum, who participated in the May and July sessions of the School, respectively.
David Beasley, who flew to Moscow directly from an International Rescue Committee fact-finding trip to Kosovar Albanian refugee camps in Macedonia, discussed "Good Governance in Democratic Society: The Priority of Human Rights," and offered his perspective on the U.S. and NATO''s intervention in Kosovo— including a firsthand account of his experiences in Macedonia. Beasley''s discussion of the Macedonia camps challenged Russian and international participants in the seminar to look beyond the official debates about the crisis and reassess their countries'' policies. SDI Director Graham Allison also attended the May seminar and gave a presentation on "The Future of the U.S. Partnership with Russia," offering his views on the crisis in U.S.-Russian relations provoked by NATO''s action in the Balkans. He took as his starting point an op-ed article on this topic that he published in the Boston Globe in April 1999, "Could the U.S. and Russia Wind Up at War?"
At the July seminar, Barbara Barrett addressed "Technology and the Government: How to Utilize Technology and Aid the Governmental Process," reviewing and analyzing how the rapid development of technology is changing the face of governance internationally. Barrett focused on Russian computer and Internet usage, the Y2K problem and Russia''s approach to this issue, the resources available to both governments and people through the Internet, and prospects for future development in Russia.
In addition to their formal presentations, the American speakers interacted with participants throughout the two five-day conferences at Golitsyno, facilitating the growth of mutual understanding with the young Russian leaders and the repair of U.S.-Russian relations damaged during the Kosovo crisis. Occasional Seminars
Over the course of the year, SDI also sponsored a number of occasional seminars on key Russian political issues at the Kennedy School, including presentations by Dmitry Vasilyev, Chairman of the Russian Federal Securities Commission, on "Russia''s Security Markets after the Crisis"; Leonid Gozman, a leading Russian pollster and Advisor to former Russian Deputy Prime Minister Anatoly Chubais, on "The Logic of the Russian Political Situation"; Kairat Kelimbetov, Head of the Social Economic Reforms Department of the Administration of the President of Kazakstan, on "The Impact of Russia''s Economic Crisis on Kazakstan and Other Central Asian Countries"; Leonid Romankov, a deputy in the St. Petersburg parliament from the Yuri Boldyrev Bloc and noted Human Rights activist, on "Human Rights and Local Government;" and a panel presentation, cosponsored with Harvard''s Program on New Approaches to Russian Security (PONARS) and the Kennedy School''s Shorenstein Center for Press and Public Policy, on "Russian Views on Kosovo."
Dmitry Vasilyev, who gave a presentation in the Kennedy School''s Wiener Auditorium on October 14, 1998, discussed the difficulties of maintaining and defending policies essential to the development of Russia''s capital markets in a time of increased uncertainty. He outlined his approach to solving the problems posed by Russia''s financial crisis, including the importance of exercising strong and determined leadership from above, a commitment to eliminating power blocs and ending political cronyism, and the need to create incentives for tax and budget reforms. He also focused on the work of the Russian Federal Securities Commission and its efforts to ensure that investors'' rights are protected and that market operations are conducted in a fair and transparent manner. Vasilyev''s formal presentation was followed by a small group discussion led by SDI Director Graham Allison with Harvard faculty and Boston-based business executives on the issues facing the Russian banking system and the ways in which international organizations such as the IMF could play a more positive role.
Leonid Gozman, who visited the Belfer Center on May 20, 1999, discussed the state of public opinion in Russia and noted that in the general crisis of Russian institutions, no institution and no political personality was really "popular." He offered an overview of Russian public reactions to the crisis in the Balkans and attitudes toward the United States; the bases of popular support for former Russian Prime Minister Evgeny Primakov; and opinions of a range of other Russian political figures, including "Right Cause" leader and former Russian Prime Minister Yegor Gaidar and former Deputy Prime Minister Anatoly Chubais. Gozman asserted that there were many hopeful signs about Russian public opinion, including a tendency to favor a Western-style development for Russia, a reluctance to limit freedom of speech, and the internalization of concepts such as elections and free speech as "Russian" as opposed to "Western." Gozman also offered his analysis of recent Russian political events, including the dismissal of Primakov and his replacement with Sergei Stepashin as prime minister; and his view of the prospects for the 1999-00 parliamentary and presidential elections. He concluded that although almost all negative criticisms of Russia could be held to be true - poverty, crime, corruption— there have also been considerable achievements over the last decade, and reforms in Russia are now irreversible.
Kairat Kelimbetov gave a roundtable presentation at the Belfer Center on May 6, 1999, during an extended visit to the United States as a Pew Economic Freedom Fellow at Georgetown University in Washington, D.C. In his former position as a member of Kazakstan''s Strategic Planning Agency in Almaty, Kelimbetov had played an active role in SDI''s 1997 Special Executive Program for Senior Officials from Kazakstan on "National Performance, Strategy, and Organization." On this more recent occasion, SDI invited Kelimbetov to visit the Kennedy School to discuss how Russia''s devaluation of the ruble and default on its foreign debt had affected neighboring states since August 1998. Kelimbetov reviewed the causes of the crisis in Russia and discussed the interdependencies between the Russian economy and the economies of Central Asia. He commented on the effects of the devaluation on Central Asian currencies and the subsequent devaluation of Kazakstan''s currency, the Tenge; the harmful impact on Central Asian exports and multilateral trade; and the drop in the international credit ratings of regional states and subsequent problems of external debt and attracting foreign direct investment. Kelimbetov argued that Central Asia''s successes in the 1990s— achieving a degree of macroeconomic stabilization and structural reform— had been threatened, and in some cases reversed, as a result of the Russian crisis. He stressed the concerns of local governments about inevitable company bankruptcies and the resultant risks of unemployment and social upheaval. In conclusion, however, Kelimbetov offered an optimistic prognosis for the future, stressing that Kazakstan in particular was proceeding with its macroeconomic policies and privatization program. He asserted that there had been one major positive outcome from the crisis— the Kazak government had finally realized that Kazakstan would have to rely on itself for its own economic development.
Leonid Romankov, who visited the Belfer Center on May 26, 1999, under the auspices of both SDI and the Center''s Human Rights Initiative, discussed the state of human rights in Russia and the progress in Russia''s second city of St. Petersburg in establishing a more European orientation. On the issue of human rights, Romankov described violations in police investigations, prisons, and the military (through the routine practice of hazing new conscripts); religious intolerance; and the persecution of peoples from the Caucasus region. He commented on domestic efforts to improve respect for human rights through the exertion of control over the executive branch, letters to government officials, media pressure, the activities of nongovernmental organizations such as the Soldiers'' Mothers'' Committee, Memorial, and Citizens Watch; and external efforts by organizations such as the European Union''s TaCIS Program. Romankov stated that his main goal was to ensure that support of human rights in Russia took place at the local level, where individual initiative could be more effective. In his discussion of St. Petersburg he described tensions with Moscow, particularly over St. Petersburg''s search for integration with Europe at a time when Moscow and the rest of Russia had begun to look increasingly toward Asia. In a follow-up meeting with SDI staff, Romankov offered his personal perspective on political party developments in St. Petersburg, relations between the Boldyrev bloc and other democratic movements in the city legislature, and the problem of corrupt elections at the municipal level.
The roundtable on "Russian Views on Kosovo" took place on May 6, 1999, and was chaired by Marvin Kalb, Director of the Shorenstein Center. The roundtable included Alexander Pikayev and Ekaterina Stepanova, from the Carnegie Endowment Moscow Center; Oksana Antonenko-Gamota, from the International Institute for Strategic Studies in London and a former Research Assistant in SDI''s Moscow office; Eduard Ponarin, from the European University in St. Petersburg; and Alexander Sergounin, from Nizhny Novgorod University. The participants offered presentations on the position of the Russian government on the crisis in the Balkans; Russian military views on Kosovo and the impact on Russian military relations with NATO; the opinions of Russian foreign policy analysts on Kosovo; and the reaction of Russian society and why the Russian public has perceived Kosovo as part of a successive humiliation of Russia by the United States and the West since the end of the Cold War. In the course of the subsequent discussion, panelists and audience members examined the impact of the Kosovo crisis on Russia''s relations with the West, the role of international law in such crises, the Russian government''s position on war crimes in Kosovo, Russia''s potential role as a peacekeeper in the Balkans, and the possible effect of the crisis on the December 1999 Russian parliamentary elections.
Russian Election Watch Bulletin
The goal of SDI''s activity and research under its Sustaining Russian Democratization strand is to inform Western academics and policymakers about the specific challenges to Russian democracy and the importance and implications of the 1999-2000 elections. In the summer of 1999, with the Russian election season under way, the project began to issue a monthly bulletin on the Russian elections edited by Research Associate Henry Hale, Russian Election Watch, which is the successor to an earlier SDI publication on the 1995-1996 election cycle and will be continued into summer 2000. This bulletin includes concise and incisive information on the elections, SDI''s own analysis of the election campaigns; direct input from the major Russian political parties; commentary by leading Russian political experts; and the latest polling results on issues, parties, and individuals. The first issue of Russian Election Watch was distributed in July and August 1999 to the U.S. public-opinion-leading elite— including top government officials, business executives, foundation executives and officers, and key media outlets— as well as the broader Russia-interest community. The second issue is planned for September 1999.
Occasional Papers
In addition to the Russian Election Watch, SDI published a number of occasional papers in 1998-99. In September 1998, SDI produced the third set of monographs from its 1997-98 "Whither Russia?" series funded by Carnegie Corporation of New York. This set of monographs resulted from an extension of the "Whither Russia?" project into an ongoing series of conferences and meetings cosponsored by the Belfer Center, Russia''s Council on Foreign and Defense Policy, and the German Society for Foreign Affairs. The Council on Foreign and Defense Policy (CFDP) is a nongovernmental public association of influential Russian politicians, public figures, government officials, scholars, business people, and members of the news media. It is chaired by Sergei Karaganov, who is also Deputy Director of Russia''s Institute of Europe. The council promotes research on foreign and defense issues of concern to the Russian Federation and its citizens, and publishes a number of reports each year that are considered in Moscow political circles to be some of the most significant Russian pronouncements on foreign and security policy.
The goal of these conferences and meetings is to set a new agenda for cooperative international relations among Russia, the United States, and Europe on the eve of the 21st century. The idea for the series originated in a joint publication, "Creating a New Democratic Fellowship," written by Karl Kaiser of the German Society for Foreign Affairs, Sergei Karaganov of the Council on Foreign and Defense Policy, and SDI Director Graham Allison; and in the questions posed by the "Whither Russia?" project regarding Russia''s identity, security, and interests. The first major international conference in the series convened on December 12-14, 1997, on "Russia and the Outside World: A New Agenda for the 21st Century." Conference participants included scholars, specialists, and senior politicians from Russia (such as Russian Foreign Minister and later Prime Minister Evgeny Primakov), Germany, and the United States. The conference focused on the necessity for a fundamental renewal of Russia''s foreign policy agenda to meet the challenges and threats of the 21st century - including such new global concerns as international terrorism, drugs, crime, and corruption. The SDI Project published the report from this conference, and two papers, Drug Addiction in Russia: A Threat to the Nation? and Russia: Eliminating Crime, which were prepared by CFPD working groups subsequent to the conference. Both drug addiction and crime were identified in the course of the December 1997 conference as issues of critical importance to Russia''s foreign and security policy agenda.
In October 1998, SDI produced the final set of "Whither Russia?" monographs: "Russia''s Strategy in the XXI Century (Strategy-3)," by the Council on Foreign and Defense Policy, which is the third important document on Russian foreign policy produced by the council ("Strategy 1" and "Strategy 2" were published in 1992 and 1994, respectively, in Nezavisimaya Gazeta); Russia''s National Security Policy: Conceptions and Realities, by Vasily Krivokhizha, the First Deputy Director of Russia''s Institute for Strategic Studies, which is a government-sponsored think tank; Russia''s National Identity in a New Era, by Sergei Kortunov, the Councilor to the Head of the Office of the President of the Russian Federation, and previously Deputy Head of Staff of the Defense Council of the Russian Federation; and Neither State Nor Market: Cozy Reciprocity in Russian Capitalism, by Lynnley Browning, the Boston Globe''s Business Correspondent and a former correspondent for Reuters in Moscow.
In addition to the "Whither Russia?" series, the project in September 1999 published a paper by SDI Associate Olga Jourek on Ethno-Political Conflicts in Post-Communist Societies: Prospects for Resolution and Prevention in the Context of International Law. Jourek joined the project in fall 1994 as a Visiting Scholar under the auspices of a NATO Democratic Institutions Fellowship and SDI''s 1993-94 Carnegie Corporation-funded project on Ethnic Conflict in the former Soviet Union. During her time at Harvard, Jourek engaged in an extended research project on ethnic conflicts in postcommunist societies and their resolution and prevention in the context of international law. The occasional paper resulting from this research examines the controversial issues of minority rights and the right to self-determination of peoples, the nationalist movements in the former Soviet republics and their impact on ethnic issues, and national and international mechanisms for dealing with ethnic conflicts. The paper makes a significant contribution to scholarly understanding of the nature of ethnic conflicts in postcommunist societies, and how they differ from intra- and interstate conflicts in the West. Its conclusions offer new approaches to tackling these kinds of conflicts at the national, regional, and international level.
II. THE U.S.-RUSSIAN INVESTMENT SYMPOSIUM
In 1996, Russian Prime Minister Viktor Chernomyrdin identified the attraction of private-sector international direct and equity investment in Russia as the single largest challenge for the Russian economy in the decade ahead and approached Harvard''s SDI Project to host a U.S.-Russian Investment symposium. The resultant Symposium on "Financial and Direct Investment Opportunities in Russia," created by Associate Director Fiona Hill and Executive Director for Moscow Initiatives Stefan Zhurek, reviewed the Russian economic and business climate and opportunities and obstacles for Western investment in the Russian Federation. By January 1998, the symposium had become the largest gathering of senior Russian and Western business and government leaders in the United States.
The Third Annual U.S.-Russian Investment Symposium on "Financial and Direct Investment Opportunities in Russia: Meeting the Challenge" was held on January 14-16, 1999, at the Hyatt Regency Hotel in Cambridge. The symposium, under the chairmanship of SDI Director Graham Allison, provided an in-depth overview of the Russian economy and international investment in the wake of the Russian devaluation and default of August 1998. Despite the uncertain and crisis-stricken state of the Russian economy, more than 500 people participated in an intense three days of discussions, lectures, and meetings on the opportunities for direct and portfolio investment.
The symposium was cosponsored by SDI, the Conference Board, the U.S.-Russia Business Council, the Russian National Foundation for Strategic Research, and the Russian Marketing Association. Generous financial and material support for the symposium was provided by Prima Industries; AEGIS, A. T. Kearney; Comverse Network Systems; McDermott, Will & Emery; Mobil, R. J. Reynolds International; Khrunichev State Research and Production Space Center; Sistema JSFC; Kazieva & Hermes-Holding; Publishing House "Kommersant", Rosneftegazstroy; Sistema Telecom; and Sobinbank.
The symposium sessions reviewed the events of the past two years in Russia and developments since last year''s symposium also in January. The Russian delegation included leaders from across the spectrum: high-level government officials such as Vladimir Kossov; business "oligarchs" such as Boris Berezovsky; business leaders such as Anatoly Kisilev of Khrunichev (a joint-venture partner with Lockheed Martin for satellite launches); and political figures such as Boris Nemtsov and Moscow Mayor Yuri Luzhkov. Federation Council Budget Committee Chairman and Samara Oblast Governor Konstantin Titov, Moscow First Deputy Mayor Vladimir Resin, and others emphasized that despite the August 1998 financial crisis and subsequent difficulties, Russia was ready to receive investment and to cooperate on mutually beneficial joint projects.
Technology played a saving role in this year''s symposium, as U.S. Deputy Secretary of the Treasury Lawrence Summers, IMF First Deputy Managing Director Stanley Fischer, World Bank Vice President for Europe and Central Asia Johannes Linn, and A. T. Kearney Vice President Martin Cannon all addressed the symposium by videobridge after their travel plans were foiled by a winter ice storm. The storm reportedly also gave Russian Deputy Prime Minister Yuri Maslyukov and Stanley Fischer an opportunity for a lengthy, informal, private discussion at Washington''s Ronald Reagan National airport, during a failed joint attempt to reach Boston for the Symposium.
In the opening sessions, Stanley Fischer, Lawrence Summers, and World Bank Chairman James Wolfensohn (who gave his presentation in person) reinforced one another''s presentations in communicating several key messages: Russia really matters; the U.S. government and the international institutions really do care and are ready to help Russia; Russia nonetheless has to do first what is required for itself with its own budget in narrowing the gap between expenditures and income; and the 1999 budget was not yet on target. European Bank for Reconstruction and Development (EBRD) First Vice President Charles Frank, Johannes Linn, and Overseas Private Investment Corporation (OPIC) President and CEO George Muñoz, among others, backed these discussions with an assessment of some of the concrete forms of assistance that are available to investors from the EBRD, World Bank, OPIC, and other agencies. Moscow Mayor Yuri Luzhkov made a special presentation via videolink live from Moscow, in which he focused on Moscow''s response to the crisis and the city''s emerging mortgage system. At the closing dinner, Samara Governor Konstantin Titov struck a positive note by declaring that "Mr. Fischer and Mr. Wolfensohn have shown that Russia can rely on international institutions, but each person and each region must work hard for its own investment."
Fourteen breakout sessions at the symposium offered a fascinating series of discussions on key topics of concern for investors, including investment in Russia''s regions (outside of Moscow and St. Petersburg), telecommunications, mortgages, Production Sharing Agreements, and investment in Russia''s nuclear cities - gathering leaders and experts on these issues from both Russia and the West.
In two successive panels on the regions, former Russian Deputy Prime Minister and Nizhny Novgorod Governor Boris Nemtsov, along with leading representatives from other regions and international institutions active in the regions, discussed the uneven distribution of investment across the Russian Federation. They highlighted regional governments'' attempts to promote foreign investment by decreasing the tax burden and passing legislation to protect investors, and described specific initiatives and investment projects. The telecommunications panel brought together the CEOs of some of Russia''s leading telecom firms and appropriate Western counterparts from Teledesic, Loral Space Systems, Global Partner Ventures, and others. The session on mortgages discussed what many think will be a major new sector for Russia in the coming years. Sessions on corporate governance and taxation addressed perhaps the two most challenging issues for investors in Russia. And a session on Production Sharing Agreements featured a remarkably frank exchange about this important piece of legislation for Russia''s economic development, particularly in the oil and gas sectors.
The session on investment opportunities in Russia''s secret nuclear cities took place for the first time at the U.S.-Russian Investment Symposium. It was jointly organized by the SDI Project; the Belfer Center''s Science, Technology, and Public Policy Program; and the Managing the Atom Project, in conjunction with the U.S. Department of Energy''s Nuclear Cities Initiative. In the session, Rose Gottemoeller, Assistant Secretary for Nonproliferation and National Security at the U.S. Department of Energy, described ways in which the Nuclear Cities Initiative, which was initiated in September 1998, was beginning to assist with the creation of jobs in Russia''s ten nuclear cities through the development of project work and infrastructure. Russian Deputy Minister of Atomic Energy Lev Ryabev, leader of the Russian nuclear cities'' delegation, described the difficulties faced by the cities in light of dramatic cuts to Russian defense spending and his ministry''s creation of a special fund to support the new programs. Other panelists described project-specific proposals for new enterprises in the nuclear cities and some of the cutting-edge work performed by these formerly closed research centers.
III. THE RUSSIAN MIDDLE-CLASS MORTGAGE INITIATIVE
SDI''s Russian Middle-Class Mortgage Initiative addresses a cluster of issues at the top of the agenda of Russia''s continuing economic marketization, as well as its political pluralization and stabilization. A solid middle class of property owners is not only a pillar of a market economy, but also of a civil, democratic, lawful society. Currently, the most fundamental form of property ownership - the ownership of one''s own home - lies well beyond the reach of all but the wealthiest Russians. Russians must purchase housing by paying the full price in one lump sum, which most are unable to afford. In the absence of individuals and families buying and maintaining their own homes, Russia''s cities are faced with a serious and seemingly intractable housing crisis. Municipal budgets can no longer support housing subsidies, and there is an ever-widening gap between the rapidly deteriorating condition of the old housing stock and the rising expectations of the average Russian.
A home financing system, in the form of a functioning mortgage market, would help to resolve this crisis. It would enable would-be homeowners to borrow from private banks to purchase new apartments in affordable installments, align housing supply with housing demand, and transfer some of the burden on municipal governments of providing and maintaining housing to the private sector. Municipal governments could then concentrate on the provision of accommodation for only the most needy.
In January 1998, SDI entered into a partnership with the City of Moscow to create a functioning mortgage market that will serve as a pilot program for the rest of the Russian Federation. The overall goal of SDI''s mortgage initiative is to create a home financing system that meets the best international standards for ownership and enforcement of contracts, that can be supported by international institutions, and that will be replicable outside Moscow in other Russian cities. The first phase of the work in 1998 was conducted in Moscow with a working group of representatives from key U.S. and international agencies with relevant expertise, from the Moscow City Duma''s expert group on legal reform, and from the Moscow City Government working group on the creation of a mortgage system. SDI was actively engaged in the preparation of the main concept for the development of a mortgage market-based system in Moscow and the action plan required for the successful implementation of this concept.
In August 1998, the SDI Project was awarded a grant by the Eurasia Foundation to support the continuation of this activity. This grant coincided with the August 17, 1998, default on Russia''s foreign debt and the resultant financial crisis in the Russian Federation, which resulted in the unavoidable adjustment of expectations and strategies for the development of a mortgage market in Moscow.
The work in Moscow was coordinated by Stefan Zhurek, the Executive Director for SDI''s Moscow Initiatives, who was resident on the ground in Russia on a permanent basis in 1998-1999. In Cambridge, this work was supported by SDI Research Assistant Cameron Half, with expert input on key conceptual and operational issues from Kennedy School Lecturer in Public Policy Jay Walder, SDI Fellow Vladimir Boxer, and other members of the Harvard Moscow Mortgage Initiative Working Group— including SDI and Belfer Center Director Graham Allison and Belfer Center Executive Director John Reppert.
The coordinating work in Moscow involved convening meetings, inviting experts to participate in the drafting of legislation and operational memoranda, defining the key issues to be tackled by the project, and following up on revisions to initial solutions. As the direct result of the August 1998 crisis, the main challenge was to organize the implementation of the mortgage concept and action plan and to ensure follow-through in Moscow. In spite of the challenges, there were four key accomplishments.The first major accomplishment was the passage of the Moscow law on mortgages by the Moscow City Duma on April 12, 1999, after a third and final reading on March 31, 1999. The new law will work in concert with the Russian Federation mortgage law, and provides for eviction in case of default by a borrower (the essential element of a functioning mortgage system which enables housing to be used as collateral for loans). Under the terms of the new legislation, in order to ensure compliance with Russian constitutional housing protections, defaulters are to be evicted to "reserve housing," which will provide minimal levels of comfort and services. Work on the law first began in spring 1998 coordinated under the auspices of SDI''s mortgage initiative and was carried out by a combined group of three sets of experts from the Moscow City Duma, the City Department of Municipal housing, and Moscow State University.
The second accomplishment was the initiation of a Moscow City educational program on mortgage lending with background materials prepared jointly by the Moscow City Government working group and Harvard representatives. In October and November 1998, the Moscow City Department of Prospective Development (headed by Moscow Deputy Mayor Vladimir Resin) held two seminars on mortgages. The first, for potential buyers/borrowers on October 10, was attended by 1,000 people; the second, for officers of lending banks, was held on November 12 and attended by representatives of 25 banks. In the wake of these seminars, the city government began to develop two types of educational programs: one general for the public, and one specialized for future borrowers. The more specialized program for future borrowers was scheduled for completion by the end of September 1999.
For the general educational program a Moscow working group, coordinated by Stefan Zhurek, prepared an educational brochure entitled "Mortgages: Step by Step" (Ipoteka shag za shagom), which explains in very simple terms what a mortgage is, how it can be obtained, who qualifies, what the procedures are for repaying a mortgage to the bank, and what happens if a borrower defaults on payments. Research assistance for the primary background materials was provided by Cameron Half in Cambridge. The brochure was intended for ordinary Muscovites and was published in summer 1999 for sale in municipal kiosks and shops. In addition to the brochure, a section of the most popular Russian weekly newspaper, Argumenty i Fakty, was devoted to "Questions and Answers about Mortgages," based on the information contained in the "Mortgages: Step by Step" guide.
The third accomplishment was the elimination of a major problem related to the registration of purchases and sales of housing that was identified at the outset of the mortgage project— a 30-day gap between the registration of a purchase/sale and the registration of a mortgage. For 30 days, Russian banks were unsure whether they would obtain the necessary collateral in the form of a mortgaged apartment before issuing a loan. The solution to this problem was to reduce the time gap to an absolute minimum to provide banks with an incentive to underwrite mortgages. During October and November 1998, SDI coordinated the introduction of procedures by the Department of Municipal Housing that reduced this gap to a period of one working day— which eliminated any uncertainty for the lending banks. The implementation of the new system was under way by June 1999.
The fourth accomplishment was the initiation in September 1998 of a pilot program for Moscow''s mortgage program. Before Russia''s default on its foreign debt of August 17, 1998 and the resultant financial crisis, several hundred banks operated in Moscow - but only ten of these banks offered mortgage loans, and on a limited basis. The major obstacle to increased mortgage lending was the lack of an eviction mechanism, which undermined the essence of a mortgage system— the use of housing as collateral. The high risks and great uncertainty associated with lending kept borrowing costs high, restricting the pool of potential borrowers. After the August 1998 crisis, even these few banks ceased nearly all mortgage lending activities. The risks associated with dollar-denominated loans in a time of high inflation increased dramatically, and without a real eviction mechanism banks were unwilling to assume these risks.
Mortgage lending by private banks resumed again in Moscow on September 7, 1998. This event was directly attributable to work accomplished under SDI''s mortgage initiative. On that date, Moscow launched a pilot project in mortgage lending that involved issuing an initial set of 12 special mortgage certificates (or obligation papers issued by participating banks to qualified borrowers confirming the borrowers ability to repay the loan) to Moscow middle-class families. Nine banks were selected to participate in the first phase of the program using selection criteria developed in consultation with the Harvard working group. Among these criteria were basic qualifications such as a bank''s creditworthiness; experience in retail lending; retail branch network; and training of bank personnel. By December 1998, the pilot program had issued 150 mortgages, with initial loans for a term of ten years, and a 10 percent interest rate. The program provided valuable experience in mortgage lending for the participating banks, real estate agencies, and city departments, in addition to providing an opportunity for 150 middle-class families to purchase their own housing.
In the course of this activity, SDI participated directly in the design of the special mortgage certificates; the drafting of the individual agreements with the banks participating in the pilot program; and the development of a questionnaire for prospective borrowers. Stefan Zhurek was also involved in the creation of two special mortgage-support schemes to run parallel with the pilot project. The first of these was designed for large Russian financial-construction companies, which have the resources both for constructing housing and underwriting mortgages for the purchase of this housing themselves. The second involved the establishment of a special mortgage-savings fund or bank based on housing finance experience in Germany, France, and the Netherlands.
In addition, on April 16-17, 1999, the "All-Russian Conference on the Development of Housing Mortgage Lending" was hosted in the Moscow Kremlin by Russian Minister of Construction Yefim Basin and Moscow Mayor Yuri Luzhkov, with some 6,000 government and business officials from throughout the Russian Federation in attendance. Speakers at the conference included representatives from the Russian State Duma, federal government ministries, and the regions. The major theme of the conference was how to boost the construction industry through the introduction of a mortgage system that will spur demand for housing. Presentations at the conference stressed the necessity of developing a residential mortgage system, the growing demand for mortgage loans among the Russian middle-class, and the readiness of most Russian governors to proceed with the creation of a market-based mortgage system. The progress being made in Moscow was cited by numerous presenters as an example of what could be done elsewhere in Russia.
The conference demonstrated the tremendous interest in mortgage lending at all levels in the Russian Federation. This interest, combined with Moscow''s practical experience in the creation and implementation of a mortgage system, illustrated the importance of decentralizing the Russian federal mortgage effort. Russia''s regions and municipalities must be able to grasp the overall concept and advantages of a market-based mortgage system to generate support within key local institutions and among the general population, create the necessary political will to implement the existing federal legislation on mortgages, and devise local laws and procedures to bring a mortgage system into operation.
Both Graham Allison and Stefan Zhurek gave presentations at the conference. Allison offered lessons from international experience in housing finance, discussed the challenges of mortgage market development in a period of economic turmoil and crisis, and provided an overview of the Moscow Mortgage Initiative. Zhurek discussed the potential for mortgage market development in Russia''s regions based on the Moscow mortgage program model.
In tandem with these efforts, in fall 1998 Zhurek began discussions with Russian regional representatives— including representatives from Samara, Kursk, Primorski Krai, Komi Republic, Kaliningrad, and Omsk— regarding the possibility of extending technical assistance for the development of mortgage systems outside Moscow. Discussions were also held with a view to coordinating efforts at the federal level with the Ministries of Construction and the Regions. The main objective in these discussions was to ensure that mortgage market development in the regions follows the model tested in Moscow, beginning with the creation of the necessary legislation and infrastructure and then proceeding with incremental experiments and improvements in the lending and borrowing environment.
THE CASPIAN INITIATIVE
With the signing of the first major international contract for the production of Caspian oil in September 1994, the Caspian Sea has become the most sensitive region for geopolitical competition between Russia and the United States. Since 1993, SDI has produced research reports and briefing materials on issues in the region for the scholarly community, governments, and business; provided continuous analysis of the conflicts in the Caucasus; helped to shape the agenda for talks among the parties to the war in Chechnya; established close connections with the relevant policy communities in the United States, Russia, Armenia, Azerbaijan, Georgia, and Kazakstan; created a seminar series with high-level speakers from both the United States government and the region; assisted in bringing fellows and students from the region to programs at the Kennedy School of Government and the University; and run executive programs for regional leaders. As a follow-on to this activity, SDI Associate Director Fiona Hill conceived and developed a broader Caspian Initiative that would examine critical issues in the Caspian Basin, including: the prospects for and complications associated with the development of petroleum in the Caspian Sea; the problems of oil transportation; the ongoing debate about the legal status of the Caspian; the region''s ethnic, political, and economic problems; regional conflicts; the individual positions of regional states; relationships between the states and neighbors such as Russia, Turkey, Iran, and China; American national interests in the region; and the challenges faced by the United States in developing its bilateral and multilateral relations with the regional states. The goal of the initiative would be to identify specific prescriptions for more effective U.S. strategy and policy that could better use the flow (and promise) of funds from oil both to speed economic development and to encourage resolution of conflict in the region.
After an intense round of proposals, consultations, and fundraising beginning in winter 1997, in summer 1999 SDI secured a major grant from the U.S.-Azerbaijan Chamber of Commerce and a consortium of oil companies including Exxon, Chevron, Mobil, and Aker-Maritime (in conjunction with ETPM and CCC) that would fund a Caspian Studies Program at the School, based within SDI and the Belfer Center. The program will be launched in September 1999. In addition to the research agenda, the primary components of the program include a conference of leading U.S. and international experts on the Caspian region to debate key policy issues and put forward concrete recommendations for action; a workshop at Harvard for leading members of the U.S. Congress to raise awareness of American strategic interests in the Caspian region; the continuation of SDI''s 1996-98 seminar series, which discussed critical issues in the Caspian and featured leading academics and key policymakers from the United States and the region; and scholarships for students from the region to enroll in degree and executive programs at the Kennedy School.
In preparation for the Caspian Initiative, in fall 1997 Graham Allison convened and chaired the Harvard Energy Security Working Group, comprising Kennedy School Professors and Belfer Center affiliates Ashton Carter, William Hogan, and Dale Jorgenson; Cambridge Energy Research Associates President Daniel Yergin; Harvard Business School MBA candidate George Appling; SDI Associate Director Fiona Hill, and Belfer Center International Security Program Fellow Aaron Lobel, to discuss U.S. interests in Russian and Caspian oil. In fall 1997, on the basis of these meetings, Appling produced an initial background paper for the group. In fall 1998 and spring 1999, Hill and Lobel revised, expanded, and updated this initial paper to reflect recent developments in energy issues, Russia, and the Caspian region, for publication in fall 1999 as a working paper entitled "Pipe Dreams: U.S. Interests in Russian and Caspian Oil." The paper was also used in spring 1999 as the basis for a policy brief by Allison, Hill, and Lobel on "The U.S., Russia, and the Caspian: The Need for a Strategic Reassessment," outlining current realities in the region, calling for a reappraisal of U.S. policy, and suggesting a number of possible prescriptions to secure U.S. interests more effectively in the Caspian region.
MEMBERS'' ACTIVITIES
In addition to the articles and book chapters listed above, in 1998-99, SDI team members took part in a number of outside initiatives related to SDI''s core research and members'' individual research agendas. In September 1998, SDI Research Associate Henry Hale gave a presentation on "Secessionism in Russia, India, and Ethiopia" at the American Political Science Association Annual Convention in Boston, offering a comparative perspective on this topic in light of his own research in Russia. In October, SDI Associate Director Fiona Hill gave a presentation on "Russian Foreign Policy in the Caucasus and Caspian Region under Primakov," at the British Ministry of Defense and King''s College Center for Defense Studies'' conference on "Russia and Her Neighbors after the Cold War," in London. This conference was part of the British Ministry of Defense''s strategic defense review. It was convened in conjunction with King''s College to promote a frank exchange of views among defense analysts and leading academics on trends in Russia''s relations with its former Soviet neighbors, and the priorities for Great Britain and other NATO members in the region. Subsequent to the conference, Hill gave two additional presentations on "Russia''s Economic and Political Crisis and the Implications for Western Research Centers" at the Conflict Studies Research Center, at Britain''s Royal Military Academy in Sandhurst, and at the Center for Defense Studies.
In winter 1998, building on work undertaken in the course of her History Ph.D., Fiona Hill completed a piece on "The Borderlands of Power: Territory and Great Power Status in Russia at the Beginning and End of the 20th Century" as part of a Festschrift in honor of Harvard History Professor Roman Szporluk, who is also Director of the Harvard Ukrainian Research Institute. This Festschrift will be published as a special edition of the journal Harvard Ukrainian Studies, in fall/winter 1999. In January 1999, Hill gave a presentation with Andrei Kortunov of the Moscow Public Science Foundation on "The Future of Central Asia," at the Third Annual Executive Program for General Officers of the Russian Federation and the United States, at the Kennedy School of Government. Hill and Kortunov compared the respective policies of the United States and Russia toward the region.
In spring 1999, SDI members were engaged in several outside projects. In March, during his research trip to Russia, Henry Hale gave a presentation on "The Development of Political Parties in Russia" to the European University''s Interdisciplinary Seminar in St. Petersburg. In April, Fiona Hill participated in the International Research and Exchange Board''s (IREX) University Council Meeting in Washington, D.C. as part of their university advisory board, offering conceptual input on new IREX programs. In May, Henry Hale presented a working paper on the role of political parties in Russia''s single-mandate territorial districts in the 1995 parliamentary elections at Harvard''s Program on New Approaches to Russian Security''s workshop in Rockport, Massachusetts. And later in May, Hale also gave a presentation at the closing lunch for the Harvard Institute for Learning in Retirement''s course on Central Asia entitled "Who Will Win the Great Game in Central Asia?" at the Harvard Faculty Club.
In June 1999, Fiona Hill completed a paper on "A Caspian Conundrum. Turkey''s Challenges in the Post-Cold War World: Pipelines and Energy Networks," for a forthcoming edited volume on "The Future of Turkish Foreign Policy" to be produced by Harvard''s Center for Middle Eastern Studies and the Kennedy School''s Kokkalis Program on Southeastern and East-Central Europe. Subsequent to the paper, Hill traveled to Istanbul to participate in IREX''s Planning Meeting for its new programs on the Caspian and Black Sea region. Participants at the meeting— including representatives from Armenia, Azerbaijan, Iran, and Turkey— discussed critical issues affecting the region and how IREX programs could address these issues.
In addition, as a follow-up to the work of the Third Annual U.S.-Russian Investment Symposium, SDI Administrative Coordinator Melissa Carr participated in a conference in June on "Transforming the Russian Nuclear Weapons Complex: The Role of Non-Governmental Institutions," organized by the Russian American Nuclear Security Advisory Council in Washington, D.C. The conference brought together specialists with expertise in arms control, nuclear security and nonproliferation issues, energy and environmental issues, research, product development, business training, job creation, and economic development, to discuss ways in which NGOs could supplement and complement the efforts of the U.S. Department of Energy''s Nuclear Cities Initiative. Participants also included the Belfer Center''s Matthew Bunn, and representatives from government agencies, scientific laboratories, private companies, universities, foundations, and NGOs. The goal of the conference was to share perspectives and lessons learned from diverse experiences in the United States and Russia and to brainstorm on additional ideas to transform the nuclear weapons complex and to create new jobs in Russia''s closed nuclear cities.
Finally, in August 1999, SDI Director Graham Allison and Associate Director Fiona Hill both participated in the Aspen Strategy Group''s summer workshop in Aspen, Colorado. The Aspen Institute brings together U.S. leaders and specialists to discuss challenging domestic and international policy issues with the goal of creating a dialogue among many points of view and identifying points of agreement and disagreement. Allison gave a presentation in a panel on "America and Russia''s Domestic Political Future," which focused on the specific policy choices that may arise for the United States in 2000 during the Russian and U.S. presidential elections, and the enduring choices about "reform" or "reformers" with which a new American president would be faced. Hill''s presentation in a panel on "America, Russia, and the New States" focused on Russia''s relations with the states of the Caucasus and Central Asia; associated issues of national independence, ethnic conflict, and geopolitics; and U.S. policy choices in the region.
Research Reports
Cameron Half, Fiona Hill, and Pamela Jewett, "Financial and Direct Investment Opportunities in Russia: Meeting the Challenge," final report from the 1999 U.S.-Russian Investment Symposium (April 1999)
Occasional Papers
Boris Brevnov, with Cameron Half, "From Ministry to Firm: Reforming Unified Energy Systems" (September 1999)
Lynnley Browning, "Neither State Nor Market: Cozy Reciprocity in Russian Capitalism" (October 1998)
Council on Foreign and Defense Policy, "Drug Addiction in Russia: A Threat to the Nation?" (September 1998)
Council on Foreign and Defense Policy, "Russia and the Outside World: A New Agenda for the 21st Century" (September 1998)
Council on Foreign and Defense Policy, "Russia: Eliminating Crime" (September 1998)
Council on Foreign and Defense Policy, "Russia''s Strategy in the XXI Century (Strategy-3)" (October 1998)
Olga Jourek, "Ethno-Political Conflicts in Post-Communist Societies: Prospects for Resolution and Prevention in the Context of International Law" (September 1999)
Sergei Kortunov, "Russia''s National Identity in a New Era" (October 1998)
Vasily Krivokhizha, "Russia''s National Security Policy: Conceptions And Realities" (October 1998)
Articles and Book Chapters
Graham Allison, "Could the U.S. and Russia Wind Up at War?" Boston Globe, April 25, 1999
Henry Hale "Breaking Up Is Hard to Do: Why Russia Won''t Collapse Like the USSR," PONARS Policy Brief no. 54 (November 1998)
Henry Hale, "Integration and Independence in the Caspian Basin," SAIS Review (Winter-Spring 1999)
Henry Hale, "The Parade of Sovereignties: Testing Theories of Secession in the Soviet Setting," British Journal of Political Science, Vol. 29 (forthcoming, 1999)
Henry Hale "The Party''s On: The Impact of Political Organizations in Russia''s Duma Elections 1993-95," PONARS Working Paper series (July 1999)
Henry Hale "The Regionalization of Autocracy in Russia," PONARS Policy Brief no. 42 (November 1998)
Henry Hale, "The Rise of Russian Anti-Imperialism," Orbis (Winter 1999)
Henry Hale, "The Strange Death of the Soviet Union: Nationalism, Democratization, and Leadership," PONARS Working Paper series (April 1999)
Fiona Hill, "La Crise à Moscou Renforce le Pouvoir des Régions," interview with Anne Nivat on Russia''s economic and political crisis, La Croix (Paris), September 9, 1998
Fiona Hill, "La Tourment Russe Vue Des États-Unis," interview with Anne Nivat on Russia''s economic and political crisis, Ouest France, September 7, 1998
Table of Contents:
Environment and Natural Resources ProgramInternational Security Program Science, Technology, and Public Policy Program Strengthening Democratic Institutions Project BCSIA Events BCSIA Publications Associates Biographies
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