In Moscow, Clinton Backs Reform Plan With Safety Net
THE message President Clinton has brought to Moscow is that his administration realizes this is no longer the time to push harder for free-market reform.
Instead, Mr. Clinton and his traveling party have asked the Russians what the US can do to help them build ``the equivalent of a social safety net'' for easing the pain and disruption of taking the economy private.
After leaving a bread shop with a dark loaf on a stinging cold Moscow day, Clinton said: ``All these folks working hard need to know that in the end they will be rewarded.''
The December parliamentary election in Russia was a wake-up call that reaction against democratic and market reforms has escalated significantly in Russia and that President Boris Yeltsin could be in serious political trouble.
``We recognize that they've got to deal with domestic problems we've got to be sensitive to,'' says a White House official speaking on condition of anonymity.
The main conclusion the Clinton administration drew from the Russian elections, says another White House official here, is that the country needed more reform, but also a stronger social safety net for those treated roughly by the new market forces in this former communist country.
What the Americans have in mind, and what they say Yeltsin is most interested in, is money that bypasses industries and organizations to go directly to individuals, in the form of employment retraining, or to new enterprises.
At the same time, a cash-strapped US government is not likely to leave any new money or promises behind here that President Boris Yeltsin can use to expand his support, the first official says. US officials are discussing instead money that has already been committed in the Vancouver and Tokyo summits last year, and $2.4 billion dollars in assistance that Congress passed recently.
One problem is that too much Western credit is extended to outmoded industries, says Treasury Secretary Lloyd Bentsen, who is conferring with his Finance Ministry counterparts here. So it ends up sustaining enterprises that are not economically viable, he says. It could be lent more productively directly to the social welfare system to sustain people while leaving them free to find work in healthier enterprises.
The White House is stressing the support it is offering to people in initiatives outside Moscow and the major cities. Clinton even handed Yeltsin a map showing how US support of the programs to house military officers returned from the Baltics is spread throughout Russia.
The stakes for the US in having a socially and politically stable Russia have been apparent throughout Clinton's trip through Europe. Russia has been the leading aggressor on the continent this century and is the leading threat to Central European countries in the long-term
The threat, as Clinton explained when he arrived in Europe, is if Russians reject democracy and market reform because of the hardship. ``Consider this,'' he said in Brussels on Jan. 9, ``the coming months and years may decide whether the Russian people continue to develop a peaceful market democracy or whether in frustration they elect leaders who incline back toward authoritarianism and empire.''
The relationship between the US and Russia clearly centers on economics now. That was also true last spring in Vancouver, when Clinton and Yeltsin met for the first time. But then, a White House aide explains, the two former rival countries were still trying to find each other's limitations and possible common ground. Now, the official says, the countries have gone beyond that to creating institutions that actually do things.
At the end of about an hour and a half that the two presidents spent together, Yeltsin assured Clinton that market reform would continue and even intensify.
Secretary Bentsen came away from his meetings with Vice Premier Yegor Gaidar and Deputy Premier Boris Fyodorov with exactly the same feeling. But he added that Yeltsin and Clinton both agreed that ``more attention has to be paid to easing some of the hardships.'' The future of reform depends on such people remaining in power, of course.
For now, US relations with Russia on traditional foreign policy concerns are going better than ever. The deal that US officials expect to sign today between Ukraine, Russia, and the US to denuclearize Ukraine is really a Ukraine-Russia deal. But the Russians asked the US last summer to help break the stalemate in negotiations. The US also has the resources to create incentives that may help the deal pass the Ukrainian parliament.