The West's relations with Russia reached a new low in the post-Soviet era following Russia's incursion into Ukraine. After annexing Crimea, Russia supported separatist movements, driving instability in the region. From the collapse of the Iron Curtain to the so-called Russian Reset to today's Russia-Ukraine crisis, the post-Soviet era has witnessed a number of ups and downs in relations between Russia and the West.
What are Russia's goals and strategies in its immediate neighborhood? What is it looking to get out of taking an increasingly aggressive stance against the West? Sphere of Influence, Russia's Foreign Policy, next on Great Decisions. The U.S. has been wary of the USSR since the Union of Soviet Socialist Republics was founded in 1917. The communist doctrine of one party rule and state control of the economy seemed to threaten the democracy and free markets championed by the West.
When the communists came to power in 1917, 1918, the first Cold War began. For 15 years, the American government did not recognize the Soviet government. What could be colder than not inviting your neighbor over for dinner? Communism was a radically new departure.
When the Bolsheviks took over in 1917, they announced that they were going to destroy the capitalists as a class. They invited people to steal what was stolen. They expropriated property.
They carried out mass executions. And the spectacle of what they were doing united the world against them. Moscow, in an attempt to create a buffer from German aggression, launched a policy of territorial expansion, invading countries in Eastern Europe. Despite a high level of distrust with Stalin's regime, the U.S. and USSR worked together to defeat Nazi Germany, but that alliance was short-lived.
From Stettin in the Baltic to Trieste in the Adriatic... An iron curtain has descended across the continent. The world was soon largely divided into two spheres of influence.
The iron curtain essentially was the Soviet Union and countries that were in the Warsaw Pact, where the Soviet Union, after the Yalta Agreement and the Potsdam Agreement, took over countries in East Central Europe and had them under the Soviet sphere through the Warsaw Pact and military alliance. The NATO alliance was the counter to that, and so what we had were essentially two military organizations that were facing off against each other. When both sides developed nuclear weapons at the end of World War II, an arms race ensued, and the Cold War was on. They were in some ways fascinated by the idea that they had in a, whatever way they could. militarily to contend with the United States.
In 1991, the Soviet Union collapsed, largely a result of economic stagnation brought on by the nuclear arms race. The USSR split into 15 independent republics. Victory has a thousand fathers. Much of what, in the simplest of all possible terms, What brought Russia down were several aspects of trying to manage the economy.
The communist system was ineffective and inefficient at managing an economy. Well, the Soviet Union collapsed under a lot of internal pressures, and these were political, economic, and ethnic. Politically, you had a system that was increasingly rigid, was out of touch with the population. Starting in the late 1980s and then... culminating in 1989 with the fall of the Berlin Wall, the Warsaw Pact fell apart, and the Soviet Union was not going to be far behind.
Very quickly, within a year and a half, communism was out, Yeltsin was in power. In the 1990s, Russia went through some turbulent years as leaders tried to convert the economy from the state control of the communist era to free market principles. The Yeltsin leadership, with the assistance of quite a few people from the United States, the World Bank, the International Monetary Fund, the Treasury Department, they enacted what was called, maybe not fairly, but they themselves called it this, shock therapy. Strobe Talbot, who then was President Clinton's number one Russia guy, said, the problem was there was too much shock and not enough therapy. Instead of moving towards a kind of democratic capitalist system like you have in most Western countries, when Russia threw off the communist system, instead they ended up with this kind of unregulated oligarchic capitalism.
Nearly a decade after the Soviet Union fell, Vladimir Putin rose to power. He's a former mid-ranking KGB officer who served in East Germany during the Cold War and then went to work in the office of the mayor of St. Petersburg in the early 1990s. Putin came into office in 2000, elected as president. There was a sense that Russia was going to restore its position. He never lost sight of what I think are still his conclusions, that the Russian public wants stability.
and security. Putin shot to prominence in the 90s for his suppression of the war in the breakaway republic of Chechnya. He soon oversaw a rebound in the Russian economy, based largely on a surge in the oil and gas sector. More than 50% of Russia's state budget comes from energy revenues and the whole economy is very, very dependent on energy and especially on oil.
Oil prices jumping from $10 to $20, then $30, $40, and eventually to $100. That was quite a boost. And Putin benefited from that. There's not much credit to be given to him. He simply, you know, didn't kill the hen with the golden eggs.
I think Putin was probably the most misunderstood senior world leader in the world, maybe in modern history. That's a record. So destroying... Though feeble, but still democratic institutions in Russia and basically turning it into a one-man dictatorship. That's what is to be misunderstood.
But that resurgence came with a price. Putin cracked down on political rivals. Tell your leaders that this regime is criminal.
It's a police state. They arrest people everywhere because they're scared stiff. That's weird.
Human rights... from Putin's view was some form of a bump on the road because he had to play by the rules up to a certain moment to remain a part of this global arrangement. The state-controlled television, basically all but two stations which are very, very small, are either outright controlled by the Kremlin or controlled by oligarchs who are Kremlin proxies. We have seen the worst crackdown against human rights in Russia since the break of the Soviet Union. For Putin, it's inconceivable that Russians would rise up and protest against his rule.
He thought they were fomented from the outside. He went after critics and bloggers and political activists. Growing nationalism and nostalgia for superpower status is also cause for concern. The first reaction of patriots when your nation suffers is to become nationalistic. Putin is said to have brought it to the fore in a way it hadn't been in recent years.
There was a very much a sense of hurt Russian pride from the 1990s when Russia was severely weakened both economically and geopolitically. The memories of those of that ten years came back with a vengeance. In 2008, war broke out between Russia and Georgia.
There were questions and discussions and debates about who started the war, but there's no doubt that Russia crossed into Georgian territory and now essentially occupies these two disputed regions. Within days, Russian tanks were within striking distance of the Georgian capital, Tbilisi. And it showed that Russia was still very strong, a strong military power, but only in relation to Georgia. Remember in 2008, Bush tried to fast-track Ukraine and Georgia into NATO, and Merkel, the Chancellor of Germany, vetoed it. So this is not like I'm making it.
And the Russians aren't stupid. They watched Putin's behavior. in the Ukrainian crisis has been almost entirely reactive, reacting to unwise Western policy.
That five-day war foreshadowed Russia's annexation of Crimea in 2014. Ukraine exploding into really violent demonstrations that had originally been peaceful in Kiev, just devolving into bloodshed. Moscow saw this as an American-backed coup. Against its ally who was democratically elected, Vladimir Putin took advantage of the chaos to seize back Crimea. They see Ukraine as part of their sphere of influence. They see them moving to the West and they're putting their foot down.
They also have specific sort of national security interests. They have the naval base in Crimea. This is his one opening to a warm water port, which has been for hundreds of years an obsession for Moscow.
He didn't... want the fleet to be based on something that could eventually be NATO territory. Successes in Georgia and Crimea may have emboldened Moscow. Crimea was so successful, so easy, and bloodless, fortunately, that he decided to try his luck in the east of Ukraine.
The Ukrainians decided to draw a line, and they decided to fight. What we're seeing in Donetsk and Luhansk, we're seeing Russian forces roll up to the border, then they're ordered to change out of their uniforms and are handed various different fatigues that don't match. They're given various weaponry, and they're sent across the border with little white ties around their limbs so that they can see who's who, to make it look like they're not officially there with the Russian army. Underlying. The rationale for that intervention was always the fear that political change in these countries was going to lead to them moving closer to the West and ultimately joining up with NATO.
The enlargement of NATO as well as the enlargement of the European Union are in the interest of Russia as well. I know that Russia has tried to spread the myth that they were promised many years ago and that NATO and the EU wouldn't enlarge eastwards. Such a promise has never, ever been given.
President of the Russian Federation Vladimir Vladimirovich Putin. Our Western partners, led by the United States of America, prefer in practice not to be guided by international law, but by the power of the gun. They have come to believe in their exclusivity and exceptionalism, and that they can decide the destiny of the world.
We are on top of breaking news of a Malaysia Airlines plane crash. Last known position was over Ukrainian air... This is what we do know, this was flight 17, 295 people on board.
This is a great tragedy. Suddenly, the conflict was internationalized. In July 2014, a Malaysian Airlines passenger jet was shot down over the Donetsk region of Ukraine. The reaction to the shoot-down, I think, was arguably even more important than the tragedy that happened to those 298 people on board.
It was how the Russian-supported forces and Putin himself reacted to the shoot-down. I would like to note that this strategy would not have occurred if there were peace in that country, or in any case if hostilities had not resumed in Southeast Ukraine. And certainly the government is responsible for this terrible tragedy. It's very abundantly clear that the Russians have been directly supporting, not just with arms, but with actual advisors and troops, the separatists on the ground in southeast Ukraine. That's the reason why their military fortunes changed so abruptly after several months of Ukrainian offensive.
And it's also the reason why MH17 was shot down. In response, the U.S. and Europe tightened sanctions on Russia. We're freezing the assets of several Russian defense companies.
And we are blocking new financing of some of Russia's most important banks and energy companies. But the sanctions don't prevent Russia from selling oil or gas to Western partners, which would likely hit the Russian economy hardest. So Germany has been a very good example in demonstrating this dynamics of an oil and gas dependency and reluctance to act against Russia. About two-thirds of Russia's federal budget comes from these...
Energy exports. So if it were to turn off the tap, it would be almost completely cutting off its own lifeblood. Sanctions are not an effective response to this sort of challenge. They entrench differences.
They don't bridge them. They create vested interests in adversary relationship. They distort markets.
They therefore create people with an interest in their continuation. Some observers say Putin's aggression is an attempt to shore up support at home. So Russia has for a long, long time dealt, as in centuries, dealt with its domestic problems by finding a foreign enemy. And Russia has huge domestic troubles at the moment.
Russia's been in decline, and they've lost a lot of influence. They don't have many useful allies around the world. President Putin has a big master plan. To re-establish a zone of Russian influence in the near neighborhood, actually covering the old Soviet space.
Russia is interested in open or frozen conflicts in this near neighborhood, and this is a reason why my assessment is that this conflict scenario will last for decades. Much of what we're seeing now on the part of Mr. Putin is to take advantage of the... penchant among Russians for stability and for strong national feelings as a way of continuing to maintain himself in power. So the economy is not doing well, massive capital flight, and now finally you have Putin saying, you know, that's it, no more. Russia has taken a stand in Syria as well.
We haven't had Russian cooperation on Syria since the civil war in Syria broke out in 2011. Russia has been arming, aiding, and abetting Bashar al-Assad's slaughter of the Syrian people. They send arms to the Syrian regime. They have a base off the coast in Syria. They block resolutions in the U.N. Security Council.
The use of ETA or the danger of it to be used has repeatedly safeguarded the U.N., the whole United Nations, against doubtful undertakings. The Russians have a constant fear that the U.S. wants to implement regime change in Russia too. So whenever it's going after Saddam Hussein or Bashar al-Assad or Hosni Mubarak or Muammar Gaddafi, it's going to go after Vladimir Putin next. Russia also supports Iran, maintaining Moscow's influence in the region. The Russians have no interest in a nuclear deal getting concluded at this point between the United States and Iran.
They had been relatively constructive over the past years. I think they're going to become less so. They're talking about how to bust those sanctions.
In what may be an indicator for the future, Russia signed a $400 billion deal to provide energy to China for the next 30 years. In the middle of 2014, Russia and China signed a deal to develop a series of new oil and gas fields in the Russian Far East and to build a pipeline that would bring gas from Russia to China. This is clearly an indication that the Russian government believes. That they need to shift strategically and long-term towards China.
They will not be able to rebuild their relations with the U.S. or even the Europeans to where it was before this crisis. But there are many areas where the U.S. and Russia share the same goals. Europe and America were able to, especially America, were able to accomplish a lot of things when they were on a good footing with Russia.
Nuclear armaments reductions, a NATO transit. point on Russian territory to get U.S. troops and material to Afghanistan, all kinds of cooperative measures. We do not want Russia as a whole to divorce itself from the global order, to become some kind of autarky.
That means tremendous misery for ordinary Russians and long term is destabilizing. So we do want to keep Russia part of the world order, but we have to understand this Russian government. is trying to break the rules and change the rules. But Russia has its own grievances against the West. I think this is clearly a move by President Putin to say we've had, since the end of the Cold War, decades of, you know, kind of NATO moving further, closer to our border, and we're putting our foot down now and reasserting ourselves.
This really fed into the sense of resentment. that Russia's security concerns were not being taken into consideration, that the West was still engaged in a process of trying to weaken, contain, and ultimately roll back Russian power. This started with the toppling of Muammar Gaddafi in Libya, where the Russians abstained and didn't vote in the UN Security Council when it authorized the bombing of Libya, and then felt that the Americans and NATO had betrayed them. Putin made a well-remembered speech.
In 2007 at the Munich Security Conference, where he accused the United States of throwing its weight around. without regard for what anybody else in the world cared. One state, the United States, overstepped its national borders in every way, in economics, in politics, in humanitarian, all imposed by one state. Who would like that? He withdrew, Bush did, America from the Anti-Ballistic Missile Treaty Agreement, which was the bedrock of Russia's concept of its national security.
Which meant America could now start building so-called missile defenses anywhere it wanted, right on Russia's border. The Russian suspicion about the NATO missile defense is not justified. The design of our missile defense system doesn't make it possible to threaten Russia or undermine their strategic capabilities.
Washington knows it's Russia's continued integration with the international community that allows the U.S. to exert pressure on its actions. When Russia is standoffish and then when the U.S. is standoffish in return and, you know, they become super polarized and not really talking to or trusting each other, it's really hard to get anything done. You know, it's not that the United States has actively tried to undermine Russia.
We haven't. The point is, we don't particularly care much. And...
We've acted like we don't particularly care much. And when the opportunity has presented itself to move in favor of our interests and be indifferent to how it affects the Russians, we're indifferent because we're America. Long term, we need to be playing for reintegrating the Russian people in the world and helping them get the same rights and privileges and prosperity that other Western nations enjoy, and they have every reason to be able to enjoy. Everybody has a great deal to gain by not making Ukraine a cockpit of contention and war. Washington is calling for greater European energy independence from Russia.
No matter how much infrastructure they build, they won't be able to significantly hedge away from that until minimum 2017. It's getting colder, and as it is, that's when the gas starts flowing or not. That's when the leverage grows. Putin's message to Russian elite comes directly from Game of Thrones.
Winter is coming. It is a wake-up call and hopefully we'll see a change in energy policies within those countries. They will look for diversification of their energy resources and relax some of their domestic policies.
Sanctions and loan guarantees have yet to significantly impact the conflict in Ukraine. Unfortunately, there isn't all that much that the U.S. can do to stop Russia's adventure in Ukraine, more than it's already doing. Let's not forget they've got thousands of nuclear weapons, so there's not much other form of pressure.
We're certainly not going to intervene militarily and get into a fight. Number one is, will West, Europe, and the United States be able to sustain the pressure on Putin's regime by... Keeping the sanctions or even imposing new sanctions if Putin keeps advancing in Ukrainian territory?
I think the ability for the United States and Russia to collaborate, to cooperate, to get along is very limited. As long as the Putin regime continues down the authoritarian path that it's been on, the ability of the United States and Russia to partner will be extremely limited. The next U.S. administration is going to be fairly hard-lined on Russia issues, regardless of which party it's from. And I think in Russia, you know, you're going to continue to see this emphasis on pushing back against the West and on asserting Russia's place as a separate entity, as a kind of pole of its own in this multipolar global order.
The conflict in Ukraine will color U.S.-Russian relations for years to come. Washington's continued response will have to be carefully calibrated to find common ground between the former superpower rivals. Great Decisions is produced by the Foreign Policy Association in association with Thomson Reuters. Funding for Great Decisions is provided by PricewaterhouseCoopers, LLP.