Strategy

The West got Russia wrong

As relations cool, governments share the blame.

When I stepped down as secretary general of the Organisation for Economic Co-operation and Development in 2006, I harboured one serious regret about my period as leader of that remarkable organization: our failure to agree to put Russia on the accession path to full membership, especially when it was requested by the Yeltsin administration in the late 1990s. Engagement with the OECD at that point, when the country was in the throes of serious economic and social challenges, would have been enormously beneficial to both Russia and the West. Had we risked it, I believe the current cooling of the relationships with Russia would not have taken place, including in all probability the sad and dangerous story of Georgia and South Ossetia, and perhaps other serious problems, such as the treatment of BP, the dismantling of Yukos, and the extraordinary and continuing persecution of Mikhail Khodorkovsky.

Why? Because once in the OECD, all such actions are put under a non-partisan international microscope that all members fear may at some time be pointed at them. Russian representatives at the most senior levels would have been called upon to explain how such actions are compatible with the obligations assumed through OECD membership. Having the Russians at the table just might have prevented or mitigated some of these tragic events, which have sent shivers up the backs of the western investment community. (The Russian stock market has plummeted.)

Lest readers think that I am of this view because of recent events, which have put relations with Russia in the freezer, consider the following letter I wrote to the OECD ambassadors in the spring of 2006, after returning from Moscow.

“Dear Ambassadors:

I have just returned from Russia for the last time as Secretary General of the OECD. As I prepare to step down from my role as Secretary General, I would like to share with you my profound disappointment and concern about the future of Russia and this Organisation. Indeed, we have had the opportunity to make a solid contribution to the future of Russia as a strong democratic country with a market-oriented economy, which we risk forfeiting for reasons which border on the trivial in the great scheme of things.

Looking at the present in light of the past is useful.

The present which I have again witnessed firsthand might be characterized as a struggle between reformers and those who still cling to the vestiges of a Soviet-style command/control economy.

Reformers, such as Minister of Finance [Aleksey] Kudrin and Minister of Economic Development [German] Gref [dismissed in a 2007 cabinet shuffle], enjoy the confidence of the President [Vladimir Putin]. But their progress is slow and painful and always runs the risk of slipping backwards with who knows what consequences. The reformers are candid in their assessment of what has to be done on every front where vested interests stand in the way of reform and where corruption remains a serious obstacle to progress. But they labour on and would dearly like to engage in a process of accession to the OECD to provide impetus to these important reform efforts.

That is the present. Let us turn to the past.

I grew up in the environment of the Cold War and the doctrine of MAD, mutually assured destruction. As recently as 1983, when I visited the Soviet Union as a Canadian cabinet minister, I felt the chill of oppression, and the continuing threat of global nuclear warfare and the end of 20th-century civilisation as we knew it. (I recall a friend who was temporarily detained upon entering the Soviet Union because he had a copy of Time magazine with him!)

Had I then predicted the disintegration of the Soviet Union and the rise of Russia to its present circumstances, I would have been dismissed as a naîµ¥ idealist.

Ten years ago, when Russia formally applied for membership, I was optimistic that it would happen before I left the Organisation. I saw this as one of the most important reform anchors that Russia could have. It was climbing a steep, treacherous rockface and the OECD was poised to hand it a rope to help guide it to the summit. Never would Russia again slip into the mould of an alienated dictatorship armed with the nuclear capacity to hold the western world to ransom and put the extraordinary planetary benefits of globalisation into reverse.

Have we done that? No….

That was one of my last formal letters to the OECD ambassadors, the spokespersons at the OECD for the policy of their countries. As best as I can recall, I did not receive one reply. A senior Russian diplomat did somehow receive a copy (relayed, no doubt, by a sympathetic country), and advised me that it was much appreciated by his government.

Opportunity forgone? I hope not.

Since my departure, the countries of the OECD are moving toward expansion, and Russia is on the candidate list. Given the treatment in the past and current tensions, it might not happen. Also, given its economic leverage in the energy sector, Russia may not care — nature has dealt it a strong hand. It will play its cards judiciously.

And why shouldn’t it? The doctrine of President James Monroe, delivered in a speech on Dec. 2, 1823, is as valid today for Russia as it remains for the United States. In an eloquent address, Monroe said: “We owe it, therefore, to candour and to the amicable relations existing between the United States and those powers, to declare that we should consider any attempt on their part to extend their system to any portion of this hemisphere as dangerous to our peace and safety.” This speech was the beginning of the notion of “sphere of influence,” which has remained a cornerstone of U.S. foreign policy practically ever since. Is it unreasonable that Russia, China, India and other major nation-states should also defend their “spheres of influence”?

The question raises a series of issues beyond the scope of this essay, because the world and realpolitik have evolved a great deal since 1823. But the basic concept of “sphere of influence” remains, notwithstanding globalization, and it should be taken into serious account before planting missiles in Poland. I suspect the United States would invoke the Monroe Doctrine should Russia suggest missiles be put in Cuba, perhaps to counter that unpredictable rogue Chavez from Venezuela.

Frankly, after all my years in politics and public policy forums, I remain baffled by the blinkered stupidity of otherwise bright and capable people who too often find themselves with leverage over policy in major nations. When I was young, I normally gave leaders of the major democracies the benefit of the doubt when they embarked upon ventures or policies that intuitively I thought were wrongheaded. After all, don’t they know more than I do? Are they not surrounded with competent, well-informed advisers? Are they not then best placed to anticipate the social and economic consequences of their decisions?

Vietnam is a good example. I was pleased with Prime Minister Lester B. Pearson’s resistance to engaging in that cruel and bloody conflict because I did not see the Canadian interest. But I was also concerned by John Foster Dulles and his domino theory. Was this not the beginning of a massive invasion and takeover of all of Southeast Asia by Communist China? Is that not why Australia sent its troops to join the Americans, fearful of that wave of millions of Chinese washing up on its shores? In hindsight, Pearson obviously did not think so, and he was right. I was saddened by the admission of Vietnam-era Secretary of Defense Robert McNamara after meeting in 1995 with his erstwhile Vietnamese nemesis: he said that if he had known then what he knew now, there would not have been that war. (And 50,000-plus young Americans and hundreds of thousands of Vietnamese would likely still be enjoying the pleasuresand beauty of this planet.) Why did he not know? Who fed the intelligence into decision-making at the White House?

Iraq is a different story. The lethal cocktail of ignorance, incompetence, hubris and sheer arrogance that brought the world this disaster deserves no further comment from me. It did not take hindsight to make that judgment for anyone following this worst foreign policy adventure in U.S. history. Let it be judged by historians.

And Russia? The “fall of the Wall” launched a tsunami of joy and hope that swept the globe. Those of us who had grown up in the shadow of the Cold War could hardly believe what had happened. Suddenly, the prospect of a nuclear holocaust had disappeared. Soviet/Russian leaders (for me, Mikhail Gorbachev) were our heroes, and soon Russian hockey players would be dominant in the NHL; their tennis players would rise to world stardom; the economic benefits to the West, namely the OECD countries (which now number 30), would be incalculable. Scientific co-operation and collaboration with Russians in confronting global risks and in exploring the new frontier of space added to our excitement and optimism. Scientists, academics, entrepreneurs, investors and business leaders saw huge opportunities, as did their Russian counterparts.

Somehow, the political and perhaps bureaucratic leadership of the western countries seemed to be travelling on a different track, another wavelength, especially in the United States, but elsewhere as well. The countries freed from theyoke of Soviet communism remained suspicious of Russia — too many historical grievances. Hence the attraction of NATO membership and the recent agreement by Poland to accept the site of a missile shield. Because of Russia’s mighty residual military capacity, the U.S. industrial/military establishment undoubtedly flexed its muscle and influence to ensure Russia would be “contained.”

This accounts for the push to bring NATO membership to the Russian borders and the creation of a “missile shield” implanted in Poland. This latter policy is embarrassing in both rationale and design. As a rationale, it’s allegedly directed against “rogue states” such as Iran, but its target obviously lies elsewhere. Anyone guess where? And in design, it will probably take the prize away from the Maginot Line as the most expensive and ineffectual defence imaginable. (But it will support the defence industry in the United States and in Russia, which must rush to respond. So it will not be all bad in terms of creating economic activity and providing a boost to GDP in both countries. As I recall, Keynes explained how burying bottles and digging them up again did add to GDP.)

So instead of embracing Russia and bringing it enthusiastically into the WTO and the OECD, or even NATO, we have given it the cold shoulder. In our media, we have largely ignored Russian reforms and concentrated on its shortcomings, of which there is no shortage.

These are short-sighted policies from OECD members, and the stakes for the planet are high. Some observers tend to discount Russia and are focusing attention on China and India. Those are emerging as major players, but I believe we are awed by their populations as much as by their achievements. Because of its western affinities in art, culture, sports, education and technology, Russia remains in a different league.

Yet our treatment of Russia has been deplorable, even shameful. And stupid. Why are the seemingly best and brightest sometimes so blind to reality?

Donald J. Johnston is former secretary general of the Organisation for Economic Co-operation; counsel, Heenan Blaikie; chairman, the International Risk Governance Council, Geneva.