An Analysis of U.S. Defense and Economic Adjustment Programs in Russia

The dissolution of the Soviet Union has presented unique opportunities as well as challenges for U.S. national interests and for U.S.-Russian relations--both in traditional security and non-security-related arenas. The last decade of transition has provided an opportunity for improved cooperation between the United States and Russia on both economic and political matters, as Russia has increasingly voiced the notion that "free-market democracy" (Russian-style) is a desired conclusion to its transitional period. Since 1991, there have been many collaborative efforts, involving the U.S. and other countries, aimed at helping to ease the transitional processes and challenges the former Soviet Union (with particular focus on Russia) has faced. Yet these efforts have been easier planned and articulated than accomplished. The task of transitioning from a centrally planned, militarized economy to a free-market, demilitarized democracy has proven to be of enormous magnitude. This includes the related challenge of dealing with the remnants of the former Soviet Union's military-industrial complex.

This paper analyzes past and current U.S. (and a few multilateral) economic, technical assistance, and other programs that have addressed defense and economic adjustment objectives in Russia, as they apply to restructuring the local Russian economies that are highly defense dependent. The purpose is to identify general trends in the approaches that have been more or less successful, given the varying contexts within Russia in which they have been implemented. The paper summarizes the ways each program has been set up for operation and actually has been implemented. Then, the bulk of the paper focuses on assessing some of the approaches that different programs have taken, rather than assessing performance records of individual programs. Having set forth these trends and potential lessons of previous experience, the paper then outlines some guidelines that might improve the development and implementation of future defense and economic adjustment programs. The ultimate purpose of the study is to provide recommendations for the U.S. government as to how its programs in Russia might be structured so that they may better meet both their individual programmatic and overall USG goals.