John Lloyd: This is one of the most dangerous periods for Russia since the collapse of the Soviet Union, arguably even before then. We all know the components of the crisis: an ailing and possibly dying president; a scramble for power which seems to be getting more acute; the concentration of power in the hands of a financial ruling class, few of whom were elected, most of whom are unpopular; an economy in which many people are paid only intermittently and in which production and investment remain sluggish; a country in which organised crime and corruption are endemic, and where the military appears to be crumbling. Can this crisis be resolved peacefully, or is it now approaching some kind of violent eruption?
Rodric Braithwaite: I have always been sceptical about the wolf of violence and civil war, so often predicted when people talk about Russia. But I do think this is a more dangerous time than the period which led up to the collapse of the Soviet Union, because at that time there was a certain logic at work: it was a process of dismantling the past with a leader who was somewhat aware of what he was doing and where he was going. For a lot of reasons, including the character of Boris Yeltsin, that sense of direction is not there at the moment. Yet for all the instability and corruption, there is a continuing democratic process, elections do keep taking place.
Peter Frank: I think that there could be localised trouble over specific issues, but widespread violence is unlikely. The Russian people have had a bellyful of violence and the terrible consequences of it are deeply ingrained. There is also a sociological reason why violence is unlikely-the worst forms of violence in Russian history, the anarchic, spontaneous bunt, have always been associated with the peasantry, and since the 1930s there has not really been a peasantry. Having said that I think we're in for a quite prolonged period of political instability.
Geoffrey Hosking: The Russian political system is really on a razor edge; things could go either way. It's very strange, in a way, that we should be so pessimistic just a few months after the first democratic election for the country's leader in Russian history. But Russia's constitution is really only as strong as Yeltsin is, which is a pretty fragile condition for a democracy to be in. And, of course, Russia isn't really a democracy; it's in that historically very dangerous condition of transition to democracy, one which can easily be derailed. Russia is beginning to look again, as it has done many times in past centuries, like a country which is being fought over by boyar clans. Yeltsin at the moment is in the situation of the weak tsar who is just about able to hold the clans in some kind of equilibrium.
I think also that Russia is in transition in another sense. It has only just stopped being an empire, and it has not really decided what it wants to become. It isn't quite a nation state, because a lot of non-Russians live in Russia, and, more important, a lot of Russians live outside Russia. The borders are not what Russia would choose, and the country still has imperial ambitions as recently shown in Chechnya. The rise of Alexander Lebed, the former national security adviser, is important in this context. He is a man who seems to represent a new kind of Russian nationalism, a post-imperial Russian nationalism, one which abandons the old imperial dreams but insists on a quite violent, defensive Russian nationalism. We saw the latter in Moldova, where the Russians, under Lebed's leadership, carved out for themselves a territory which they could think of as part of Russia.
I do not share the view that widespread violence is unlikely. The army is in a dangerous mood, it is more or less breaking up, and we know that a lot of soldiers are selling weapons of all kinds. Gang warfare in the streets of Russian cities could escalate, and a lot of people could become involved. If that happens, it would lead to an authoritarian takeover by someone like Lebed who has a reputation for incorruptibility, or did have until his alliance with Alexander Korzhakov, Yeltsin's former security chief.
Archie Brown: One cannot yet speak about a consolidated democracy in Russia. Does anyone really believe that Yeltsin would have handed over power to the communists if they had won the election? When I was in Moscow recently people were saying, "Well, Lebed is a rough leader but the people are in a rough mood." There are scientists and army officers committing suicide because their once prestigious organisations are crumbling. The country is not about to erupt into violence but I do think the situation is pretty dangerous.
Irina Isakova: We are trying desperately to build democratic institutions in Russia, but I agree that a peaceful handover of power by Yeltsin was not imaginable. People now talk about a financial dictatorship, meaning that the authorities now exercise power by deciding which parties to support financially. In a way it is like many other democracies. It is certainly an advance on the old system.
As an insider, I have always been afraid of social unrest. I am sorry, I can't help it. With every crisis, I always have this schedule inside me. I calculate, okay, if Yeltsin dies that means Prime Minister Viktor Chernomyrdin will have three months to govern and then he must have an election. Will he do it? What are the forces lined up against him? Could an explosion happen? I agree with Peter that if there is violence, it is likely to be on the local level; there is no unified force that could give it a national focus. The fact that the military has not moved despite the evident distress of its situation is a good sign.
John Lloyd: So who is running Russia? And how serious is the Lebed-Korzhakov challenge? Will there be another democratic election or are we in a pre-coup situation? Anatoly Chubais, the presidential chief of staff, is evidently the most powerful man in the country and he has not been elected. He and Tatyana Dyachenko, Yeltsin's younger daughter, form a sort of regency and are controlling access to the president. If Yeltsin dies, many people believe that they will stay in charge. Clearly there has been some drawing back from more liberal days-especially in television and radio. There has been a choking off of the ventilation channels which for the last five years have been one of the glories of Russia.
Rodric Braithwaite: But the point about Russia now is that no one small group of people can run it. It is not a centralised political system in the way it used to be. Yes, the oligarchy is powerful, but Russia is now quite a pluralistic society, especially when you get out into the regions.
Peter Frank: And the presidency will be weak even if Yeltsin makes a full physical recovery, for the same reason that Bill Clinton will be weak-it is a second and last term of office. Yeltsin may also remain weak in another sense. I have heard that his doctors are worried about his mental as well as his physical condition. He is deemed by some to be clinically depressed.
Archie Brown: So who's next? Chubais himself could not become president because he is unpopular with the mass of the people; he needs to find a candidate who is acceptable both to him and to enough of the people. Chernomyrdin is competent enough but not very exciting. Yuri Luzhkov, the mayor of Moscow, is popular in the capital, but perhaps they could find somebody from the provinces.
John Lloyd: Lebed is the ?nence grise. Irina, from your talks with people in the army in Moscow, how do you think he is regarded?
Irina Isakova: Well, in the military the middle level officers supported and support Lebed, but not against the president and the minister of defence. Lebed is attractive, but they are more interested in someone who actually has power, who is capable of improving their dire situation. There is also very little favour in the military for Lebed's new ally, Korzhakov, who could damage his support.
Geoffrey Hosking: I do think that Lebed is a profoundly important figure. Lebed, it seems to me, is the kind of figure who could create a genuine political movement in Russia, probably the first serious one after the communist party. What would he stand for? A tough-minded, post-imperial Russian nationalism, and, of course, the restoration of law and order with the emphasis on order rather than law. I think he is probably a more flexible politician than we've seen so far. I don't know how I myself regard him, whether I approve or disapprove of him, but I think he is a very important figure.
Peter Frank: Why have the Russian political elite closed ranks against Lebed? It's not because he is a former general, or because they perceive him to be undemocratic-their own credentials on that count are not good. It is rather because he represents change. He produced a programmatic statement for the presidential election, which was extremely detailed and would, if implemented, have damaged the interests of much of the establishment. Like Geoffrey, I am not sure how I feel about him personally, but I think we have to view him not simply as somebody with negative connotations because he is from the military.
Rodric Braithwaite: But the real Lebed is a man who is actually very difficult to read because he does consistently contradict himself. Earlier this year he had two economic programmes, one written by Sergei Glaziev and one by Vitaly Naishul, which were entirely contradictory, and yet he claimed not to see the difference between them. A lot of Russians I respect rather look forward to a Lebed presidency. I worry about his lack of experience.
John Lloyd: I want to move on to the economy. Tax revenues have fallen to 50 per cent of what should be collected. The IMF has just cut off, temporarily I assume, some of its aid because of the tax crisis. There is very little investment and, having dived down to new lows in GNP, the best forecast is for growth in two years time. Is all the painful progress towards a free market now at risk?
Rodric Braithwaite: Well, I don't think that free markets are at risk. The market in Russia is diseased but it functions, especially in the service sector-the fact is that you can now buy things in shops. A large chunk of the population has been impoverished but another large chunk does have the money to buy things. Russia is now part of the world economy in a way it never used to be. Of course, money flows out, which it never used to, but if Russia gets one or two things right, the money will flow back again. The interest of foreign businessmen in Russia is not diminishing at all. At Morgan Grenfell I spend a lot of time talking to these people who seem remarkably impervious to the political ups and downs, more so than perhaps is prudent. To borrow one of Archie Brown's phrases, we have at present "rough capitalism." And it is actually much rougher than the Russians think it is, because they make a false comparison with what was going on in the US at the end of the last century. Despite all the excesses, the US had the rule of law and dealt with the Rockefellers with the anti-trust laws. I look forward to reading the headline "Russian supreme court forces the break-up of Gazprom." Could it happen by 2005? I doubt it.
But the biggest problem remains the failure to deal with the restructuring of heavy industry in Russia. Western economic advisers, including the IMF, tend to write that off saying that if you get other things right that will correct itself. But it hasn't.
Archie Brown: The economic and social problems are closely intertwined because you have these huge factories concentrated in one town, employing sometimes tens of thousand of people, and if they go down the whole town goes down. This is one reason why the situation is so tense today. I think there was a case for more protection of Russian industry in the early post-Soviet stage.
John Lloyd: Do we now have a business class that is so criminalised and so inured to corruption that, outside the underworld, it will not be able to function properly in international markets?
Geoffrey Hosking: Yes, that may well be the case. But it is not capitalism which is weak in Russia, it is the state. The state cannot enforce law or collect taxes, and these things are absolutely crucial for the functioning of a capitalist economy. While those things are not functioning, investors are going to be cautious.
Peter Frank: The problem with the economy is that there is a lot of dealing and some extraction but little production. Until the economy starts producing, it's going to be in a state of crisis-production is obviously linked with investment, investment is linked with confidence and confidence with the political process. The economy is chasing its tail at the moment; what it needs is some sort of deus ex machina to intervene, but what the deus is, God knows!
John Lloyd: If you have a political class and a business class which are more or less indistinguishable, and they are simply creaming off financial assets, they have no real incentive to improve productivity. Perhaps until the criminalisation and corruption is tackled, you will not get the kind of progress we are talking about.
Rodric Braithwaite: Russia may be less unusual than it seems in this respect. We were talking earlier about subsidising political parties. That was true of Italian politics for a long time, too; Fiat subsidised fascists, christian democrats and communists quite even-handedly. Regarding corruption-in business and politics-there are also Latin American parallels. How do you break out of the cycle? There are violent, strong man solutions, but as Peter said, there is quite a strong inoculation against that among ordinary Russians. The other kind of solution, which takes time but is now starting to happen in Latin America, comes from the villains themselves. They decide that there are better ways of regulating their disputes than with kalashnikovs, and that there is something to be said for doing it through the law courts. But the real question is whether ordinary people are prepared to wait the three generations which it might take to work all this through.
Irina Isakova: It may be coming sooner than you think. In the summer of 1994 there was a meeting in Vienna organised by the main criminal groups which stated their support for law and order in Russia because the streets were no longer safe for crime! But the real answer is political. As long as the opposition remains extreme nationalist or communist, we will have one party rule as they did in Italy for so long. As in Italy, people will turn a blind eye to the corruption in the bureaucracy because the main goal of politics is to keep out the extremists. So the answer may lie with a responsible, constitutional, opposition.
Peter Frank: It is worth remembering what Lebed's recipe is for this problem. What he says is that the bureaucracy is the most corrupt element in Russian society so it must be pruned back. There are said to be four times more bureaucrats in today's Russia than there were in the Soviet Union, which is a pretty scary thought.
Rodric Braithwaite: Chubais says something very similar. The question is how do you achieve it? You get trapped. Chubais is certainly trapped in the logic of a system of which he disapproves.
John Lloyd: We must move on again, this time to foreign policy. Gorbachev recognised that Russia could not sustain the role of world superpower and pulled back. What are the priorities now? What about relations within the Commonwealth of Independent States (CIS)? Is there a new imperialism?
Rodric Braithwaite: As Geoffrey said earlier, the Russians are probably in a post-imperial mood, but they have a serious problem because they don't know what the shape and size of their country is. That may bring them into conflict with many of their neighbours. I don't think they want to swallow up Belarus because it would be very expensive, but if they did, there would be no international uproar. Similarly, the Caucasus is a legitimate buffer zone with two old empires of the past. The Ukraine is very different. Russians don't think that the Ukraine is viable and do not really acknowledge that it exists. I think they are wrong. But it is a very difficult thing for Russians to cope with, with relatives living just the wrong side of the border and so on. There will be a lot of post-imperial problems, witness Chechnya, but the imperial itch itself seems to have gone.
Irina Isakova: I see it rather differently. Russia needs a CIS. It is vital for Russia to keep its foot on the ground in Belarus and Kazakhstan, and to have access to the transportation networks which connect Europe and Asia. What are the other priorities? The US, of course, and, within Europe, Germany. Many among the foreign policy elite think that the special relationship with Germany is the answer. They see Germany as not only providing technology and investment, but also access to European institutions. They also seem to believe that the special relationship with Germany will help resolve many of the security issues involving Belarus, Ukraine, the central and east European states, and even Nato expansion.
Relations with China are currently good but there is a long term problem of Asian states wanting to expand into the empty expanse of Asian Russia. There are only 18m people who live beyond the Urals in Russia.
Rodric Braithwaite: On the CIS, there can be no objection to more integration as long as it is freely negotiated. But on the questions of economics and transport links I was struck-I hope Irina will not object to me saying so-by her old-fashioned approach. At the time of the arguments about Lithuanian independence, the Russians raised objections on the grounds that they needed to ensure access to the port of Ventspils. But this is economically absurd. Rotterdam is Germany's largest port and if you told a Dutchman that he wasn't independent he'd be very surprised. You do not need political control in order to secure transportation lines. There is actually a conflict within Russia about this, over oil in the Caspian sea. On the one hand you have the foreign ministry with very old-fashioned ideas about trade following the flag. On the other hand you have Lukoil getting 10 per cent of the action. That's the modern way of doing it. And of course in the 1950s and the 1960s it was called neo-colonialism by the multinationals. But that's the way it's done, and on the whole it does not involve killing so many people, so it's better.
Finally, a word on the special relationship with Germany. I am sure that Irina is quite right, that a lot of people in Moscow think it is possible to run eastern Europe in the old way-by dealing between Germany and Russia. But I think one of the reasons that Helmut Kohl is pursuing the enlargement of the EU and economic and monetary union, is precisely because he does not want Germany ever again to be tempted to play that game in eastern Europe. Although I do not favour the expansion of Nato, I can see a point in Poland joining-just to make it clear that those games are over. This is in everybody's interests, including Russia's, although it does take an effort at enlightened self-interest by the Russians to see that.
John Lloyd: What about the expansion of Nato? Is it now a done deal?
Rodric Braithwaite: Well, I think it's a policy that was not thought through in advance and nobody quite knows what it's there for, apart from considerations of American domestic politics, but we are stuck with it now. Western foreign ministries and, perhaps even more, defence ministries-at least European ones-are well aware of the complications and booby traps in the policy, which is why you get all this talk about some kind of a deal with the Russians. Foreign Minister Yevgeny Primakov picked up on that very quickly. I have got a great deal of respect for him as a foreign policy operator, and we can probably do some sort of deal with him in which Nato expands up to a point, but in return makes certain commitments about not moving troops or nuclear weapons forward, and generally treating the Russians as a serious European power.
Archie Brown: We keep telling the Russians that it is in their interest to accept Nato expansion, but I have met very few Russians who think it is. I rather disagree with the view that the Russian elite has accepted Nato expansion. If Nato expands to the Russian borders then I think this will give a tremendous fillip to Russian nationalism.
Irina Isakova: Russian public opinion polls on Nato enlargement show that 25 per cent believe that if Nato enlarges Russia should take counter measures, 25 per cent think that Nato enlargement does not threaten the security of Russia at all, and 50 per cent are completely indifferent.
Archie Brown: But elites make policy.
Irina Isakova: Elites do make policy but it seems better to strike a deal with Nato than to be left in isolation without a proper arrangement with the main security system in Europe.
John Lloyd: Let us move on again to some more historical perspectives. Has the west been behaving sensibly towards Russia? And, finally, what are the successes and failures of Yeltsin himself?
Archie Brown: In my view the west has put too much stress on the building of capitalism and on the person of Yeltsin as the embodiment of democracy. Some people still insist that if you build a market economy, democracy will automatically follow. But we know many market economies which also have highly authoritarian political regimes. We should have placed much more emphasis on the rule of law and on democratic norms and institutions, and not assumed that whatever happens must be democratic because Yeltsin has done it. The west has been less critical of Yeltsin for deaths which must number somewhere between 30,000 and 80,000 in Chechnya, than it was over the death of 14 people in Vilnius in January 1991, when Mikhail Gorbachev was still the general secretary of the Soviet Communist party.
Irina Isakova: One very useful thing that people often forget now was the emergency aid coming from the west during the transition period from Gorbachev to Yeltsin. It not only helped people on the streets, but also neutralised potentially nationalistic feelings.
Geoffrey Hosking: I do not think that the west could have made very much difference. The one thing that we should have done and which we didn't do, was to create a stabilisation fund for the rouble. The great inflation did a lot to facilitate the rise of the Mafiosi groups. And with a stabilisation fund we could have stopped that without actually handing money over to people we did not quite trust.
Rodric Braithwaite: I was involved in the stabilisation fund debate, and having thought about it since, I still find it hard to decide one way or the other. I think that it was probably right to say no to Gorbachev, but when the great economic reformer Yegor Gaidar asked for it in early 1992, it might have prevented the inflation. But the west was worried about its debts at the time, so I think we missed an opportunity.
Peter Frank: On the broader issue, I think it was the late Andrei Sakharov who said that he was dismayed that the west was paying so much attention to personalities, whereas throughout the dreary years of the cold war it had always stood on principle. I suppose we could argue for ever about what constitutes democracy, but it seems to me that any definition would have to include three elements: choice, accountability and the rule of law. Choice in the form of elections there certainly is-in a way that was not there before. Accountability it seems to me is very weak. And the rule of law is weaker still. I think we should have been utterly stringent on all these things, but we have not been. We have tended to regard what is happening in Russia as a choice between lesser evils, and I think that has led us down a slippery slope to supporting political leaders unconditionally.
John Lloyd: I suppose this comes down to the realist versus idealist view of foreign policy. The classic realist view of Yeltsin, which seems to have prevailed, is "Well, he may be a bumbling authoritarian old drunk but he's our bumbling authoritarian old drunk." We invested a lot of political and financial capital in him and it has sort of worked. Russia is a semi pro-western, semi market democracy. Which brings us on to that assessment of the Yeltsin years.
Rodric Braithwaite: I think that relative freedom of the media, democracy, a form of accountability and an attempt to introduce the rule of law were things which Gorbachev set out to achieve and to some extent did. I don't believe that Yeltsin ever thought any of that through, and that's the difference between them. Yeltsin happened to be the right man at the right place and he had certain qualities of moral and physical courage. I think the rather amazing decision in 1992 to choose Gaidar and back him, was right, and it was a decision which Gorbachev was never able to make. On the question of his confrontation with parliament in October 1993 I think that is more complicated. It was badly handled but the fact was that the parliament was running out of control. The butcher's bill was too high. But on the issue itself, I think Yeltsin was on the right side.
Irina Isakova: Yeltsin's success was to switch policy from being a function of ideology to being a function of money. His biggest mistake was the constitution of 1993 because it contains no balance of power.
Archie Brown: I agree that the 1993 constitution should be counted among Yeltsin's mistakes, that the executive is far too powerful in relation both to the legislature and the judiciary and there has been a movement away from checks and balances which were beginning to develop even in the last years of the Soviet Union. His two achievements: a kind of marketisation which went much further than under Gorbachev, and political pluralism.
Geoffrey Hosking: At the centre of one's judgement of Yeltsin must be October 1993. I think there were solid legal arguments in favour; the parliament was pursuing policies which were very dangerous, both not assisting economic reform and declaring parts of the near abroad to be parts of Russia. When Yeltsin dissolved it he also called new presidential and parliamentary elections-hardly an authoritarian act. What he did wrong was to not prepare properly for the dissolution, which meant he ended up using immoderate force. It is very difficult to say whether he has left Russia better than he found it. There are genuine achievements. The relative freedom of the media is one. The conduct of free and fair elections is another. But having set up a more democratic system, he then did not act as a constitutional head of state should do. He detached himself, surrounded himself with cronies and acted like an old style Soviet politician.
Peter Frank: On balance the good outweighs the bad. But Yeltsin has not left Russia yet and I think the manner of the handover of power when he does will be a crucial test of whether he has succeeded or not. Just one final point. Yeltsin's decision to back Gaidar over price liberalisation in January 1992 was a very courageous act. A lot of people pick holes in the decision now, but I think we've got to remember what Russia was like until 2nd January 1992. My main regret is that Yeltsin abandoned Gaidar in December 1993. Russia has always been preoccupied with being a great power, and that has always meant being a great military power, but I do not think many Russian politicians have thought about being a great country. It is an important distinction. I was in Denmark recently and-bikers notwithstanding-it is a great country by almost any criteria. By no stretch of the imagination could you argue that Denmark is a great power. Briefly, when he was deputy prime minister, Gaidar had the priority of great country over great power.
Rodric Braithwaite: I agree. The formula was actually best expressed by Eduard Shevardnadze, who said, "What sort of country do we want to be? Do we want to be a great power that everybody is afraid of, but which has the highest infant mortality rate in the world after Mozambique, or do we want to be a great country?" And it is a dilemma which a lot of Russians still don't understand. You can be a great country without being a superpower. It would be interesting to know where Lebed stands on this.
Finally, one of the emotions I most associate with Yeltsin is exasperation. For one of his characteristics is that he is magnificent in a crisis for a short period, but he simply cannot cope with a crisis that lasts for longer than a few days. After October 1991, instead of capitalising on his victory, he went on holiday.
John Lloyd: Time for us to go too, thank you.
