Calling for a "strategic alliance with Russian reform," President Clinton Thursday urged Americans to support additional economic aid to the countries of the former Soviet Union, warning that "our ability to put people first at home requires that we put Russia and its neighbors first on our agenda abroad.". . .That campaign will be somewhat eased, at least in the short term, because Clinton plans to fund the first phase of his Russia aid plan by using roughly $400 million the Bush administration obtained but never spent, a point confirmed Thursday by Secretary of State Warren Christopher. . .Clinton has notified congressional leaders of his intent to seek at least $700 million in aid for Russia in fiscal 1994, and officials have said the figure may be closer to $1 billion. But the president will limit his discussions with Yeltsin on direct U.S aid to uses for the $400 million in unspent funds, officials said.
After seven years of economic “reform” financed by billions of dollars in U.S. and other Western aid, subsidized loans and rescheduled debt, the majority of Russian people find themselves worse off economically. The privatization drive that was supposed to reap the fruits of the free market instead helped to create a system of tycoon capitalism run for the benefit of a corrupt political oligarchy that has appropriated hundreds of millions of dollars of Western aid and plundered Russia’s wealth.
The architect of privatization was former First Deputy Prime Minister Anatoly Chubais, a darling of the U.S. and Western financial establishments. Chubais’s drastic and corrupt stewardship made him extremely unpopular. According to The New York Times, he “may be the most despised man in Russia.”
Essential to the implementation of Chubais’s policies was the enthusiastic support of the Clinton Administration and its key representative for economic assistance in Moscow, the Harvard Institute for International Development. Using the prestige of Harvard’s name and connections in the Administration, H.I.I.D. officials acquired virtual carte blanche over the U.S. economic aid program to Russia, with minimal oversight by the government agencies involved. With this access and their close alliance with Chubais and his circle, they allegedly profited on the side. Yet few Americans are aware of H.I.I.D.’s role in Russian privatization, and its suspected misuse of taxpayers’ funds.
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H.I.I.D. had supporters high in the Administration. One was Lawrence Summers, himself a former Harvard economics professor, whom Clinton named Under Secretary of the Treasury for International Affairs in 1993. Summers, now Deputy Treasury Secretary, had longstanding ties to the principals of Harvard’s project in Russia and its later project in Ukraine.
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Despite exposure of this corruption in the Russian media (and, far more hesitantly, in the U.S. media), the H.I.I.D.-Chubais clique remained until recently the major instrument of U.S. economic aid policy to Russia. It even used the high-level Gore-Chernomyrdin Commission, which helped orchestrate the cooperation of U.S.-Russian oil deals and the Mir space station. The commission’s now-defunct Capital Markets Forum was chaired on the Russian side by Chubais and Vasiliev, and on the U.S. side by S.E.C. chairman Arthur Levitt Jr. and Treasury Secretary Robert Rubin.
Gore's Links With Russian Now a Liability
Republicans in Congress are demanding to know whether Gore made "secret deals" to let Russia sell submarines and other advanced weapons to Iran. GOP candidate George W. Bush charges that under Gore, foreign aid money "ended up in Viktor Chernomyrdin's pocket." And Rep. Christopher Cox (R-Newport Beach) accuses Gore of pressuring the CIA to suppress evidence that Chernomyrdin was corrupt.
The election-season charges are all debatable--and Democrats, not surprisingly, reject them heatedly. Gore's 1995 "secret deal" on arms sales, they point out, was publicly announced at the time (although some details were not). The charges against Chernomyrdin have never been proven; there's no evidence that the Russian skimmed any foreign aid funds.
Still, the controversies have allowed Republicans to turn the tables on Gore and challenge the vice president on foreign policy, his supposed strong suit.
Like a "vast right-wing" conspiracy?