This volume contains the proceedings of a conference held at the Center for International Security and Arms Control in May 1996. The meeting was the latest in a series that CISAC had held over the years with Russian specialists from the Center for Scientific Research of the Committee of Scientists for Global Security, the Ministry of Defense, and the Russian Academy of Sciences. The general rubric under which these meetings were organized is "Strategic Stability to the Year 2000."

The May meeting had a special significance because 1996 was a year of presidential elections in both Russia and the United States, and the prospect of these elections was inevitably reflected in the discussions. But another general point emerged in the meeting, and that was the need to pay more attention to the strategic relationship between Russia and the U.S. Much had been done since the end of the Cold War to wind down the nuclear competition between the two countries, and agreements have been signed to reduce the enormous nuclear arsenals built up during the Cold War. There is much to be done, however, to ensure that this course is continued. The uncertainty
about ratification of START II by the State Duma, and the proposals in the U.S. Congress for deployment of a national ABM system both cast doubt on the possibility of further reductions in strategic offensive arms. The prospects for pushing nuclear weapons into the background of international politics are clouded by the renewed Russian interest in the role of tactical weapons in regional conflicts, and by U.S. interest
in the use of nuclear weapons to deter chemical and biological weapons attacks.

The issues discussed in the conference are embedded in broader political relationships, and this meeting suggested the need for a more intensive and broader strategic dialogue. In both countries there had been a lessening of interest in issues of arms control, but the process of reducing and eliminating nuclear weapons, to which both states are formally committed, is a complex and contentious one, which requires
political trust and careful management. Hence, the importance of a strategic dialogue which examines the conceptual basis of Russian-U.S. relations. Several participants in the conference spoke of the need to transform, or move away from, nuclear deterrence.
Many proposals were advanced for further cooperation in arms control and disarmament. But it is clear that much remains to be done to move Russian-U.S. relations onto a more stable footing.

The Center for International Security and Arms Control (CISAC) at Stanford University convened a workshop that dealt almost exclusively with software groups from the military-industrial complex. It also excludes any examples of software initiatives in Russia that are currently directed at the Russian market; however, it is the author's undocumented impression that there is not yet much commercial activity in this area.

This report is based primarily on the presentations and discussions at the workshop and secondarily on additional case data. The process of selecting cases for the workshop was not geared to find these failures as easily as those cases in which there is an ongoing activity. Nonetheless, the tendency toward success in software ventures versus
manufacturing ventures in the enterprises that are included is compelling.

Executive Summary

This paper considers the emerging structure of the international security system after the end of the Cold War. It describes the changes that have taken place in world politics with the end of the bipolar confrontation, and the new threats and challenges that face the international community in the post-Cold War era. It discusses the implications that this new international system has for European security and, in particular, for the security of one of the newly independent states-Ukraine. The role of international organizations, in particular the United Nations, in countering new threats to global security is examined, and a number of recommendations proposed for reforming the UN to meet these challenges more effectively.

The collapse of the Warsaw Pact has left Central and Eastern Europe in a security vacuum. Regional organizations such as the Organization for Security and Cooperation in Europe (OSCE), however important, are unlikely to fill this vacuum and become an effective security structure for the new Europe. The further expansion of NATO may well have an adverse effect on the domestic political process in Russia. As a temporary measure, a "neutral area" could be created for the countries of Central and Eastern Europe, the security of which could be guaranteed by NATO and Russia.

As for Ukraine, it finds itself at the crossroads of regional politics, with influential domestic groups of both pro-Western and pro-Russian orientation. Its membership in NATO in the near future is neither likely nor desirable, and may have a negative effect on European security. However, the security of Ukraine, and in particular its relationship with Russia, is a very important factor for European stability and for relations between Russia and the West.

In this new global situation, the UN could become an effective center for global security. To adequately perform this function, the organization needs profound reform. This reform could include three main stages: strengthening the UN's role as a forum of discussion, creating a center for diplomatic coordination and conflict prevention, and creating a mechanism for implementing the UN's decisions. In the distant future, the UN may assume responsibility for administering the nuclear weapons remaining after global nuclear disarmament.

Other steps in the reform process may require altering the UN Charter, including expanding the Security Council to 20-21 members, with new members such as Germany and Japan (among other new regional leaders) taking the permanent seats; and revising the right of veto of the permanent five and possibly replacing it with a consensus or a majority vote mechanism.

The UN peacekeeping operation is another domain that requires close examination and restructuring. The organization should be primarily concerned with conflict prevention. Peace enforcement operations should take place only by decision of the Security Council, and member states should provide more support, financial and other, and be encouraged to contribute troops.

In the area of economy and development, the UN should take the leading role through creation of a UN Development Council. The United Nations Conference on Trade and Development (UNCTAD) could perform the role of a coordinating body for other international institutions, such as the World Trade Organization and the World Bank.

It is no exaggeration to say that arms control has undergone a revolution in the past decade. In the forty years since the bombings of Hiroshima and Nagasaki ended World War II and began the nuclear age, governments, organizations, and individuals have worked to reduce the threat of wars between great powers employing weapons of mass destruction-nuclear, chemical, and biological. Some progress was made during this period; the Limited Test Ban Treaty (LTBT) of 1963, the nuclear Non-Proliferation Treaty (NPT) of 1970, and the Anti-Ballistic Missile (ABM) Treaty and Biological Weapons Convention (BWC) of 1972 were the more notable achievements. But progress was always slow, frustrating, and tentative, with no assurance that the whole fabric might not be undone by an increase in superpower tension or by domestic forces in either the United States or USSR hostile to the very concept of arms control.

Political stability in Russia requires greater coordination between national and regional interests. Both national elites and regional elites depend on one another to get into and remain in power. To date, their relationship has been a competitive zero-sum one. The President has tried every kind of force to bring the regions under his control. In turn, governors persistently exploit the President when he is least able to control them.

Neither parties nor legislative institutions exist to communicate regional interests at the national level. This encourages regional leaders to press their concerns directly on the federal administration, and also deprives parties of regional support. If regional leaders' demands could be channeled through the party system, fewer demands would be placed directly on the federal administration, and relations between regions and center would become less zero-sum.

In the aftermath of the Cold War, global economic competition has come to play an increasingly important role in defining national security and the shape of the future world order. As international conflict shifts from military to economic competitiveness, many nations are now hoping to extract economic advantage from their investments in defense research and production. This volume brings together papers on several key aspects of defense commercialization and attempts to bridge the divide between research on conversion efforts in the United States and studies of transition in post-Communist economies.

This reader provides a well-rounded view of the conflicting debates and trends that led to the collapse of the Soviet Union. The authors have brought together Soviet documents and commentary as well as outstanding Western analyses dealing with developments in Soviet politics, economy, society, culture and foreign policy from 1985 through 1991.

Special report from a conference hosted by Stanford University's Center for International Security and Arms Control on "Nationalism, Ethnic Identity, and Conflict Management in Russia Today" on January 24-26, 1995. The four main topics addressed were problems of federalism and power-sharing between Moscow and the Russian republics; the results from a study of the attitudes of Russians and non-Russians in several republics toward political and economic reforms; the use of force to resolve disputes within the Russian Federation and the Commonwealth of Independent States; and the causes and consequences of the Chechnya crisis.

In this paper, we investigate the extent and likely impact of employee ownership on the transition process under way in Central and Eastern Europe. Despite the fact that political realities in most of the region imply that sales or transfers to employees often represent a significant privatization path, much of the literature on economic reform has been critical of the potential role of employee ownership in enterprise restructuring (for example, Blanchard et al., 1991), although the ownership form also has a few proponents (for instance, Ellerman, 1990). The relative merits and differences in behavior of employee-owned firms compared with "conventional" capitalist firms in market economies have received considerable attention in the Western literature (for example, Bonin and Putterman, 1987; Bonin, Jones, and Putterman, 1992; Hansmann, 1990; Pencavel and Craig, 1994). What is not yet well understood is the particular strengths and deficiencies brought by employee ownership to the process of transition itself. Our attempts to answer this question provide the conceptual framework in this paper against which actual privatization programs in various countries are evaluated and against which hypotheses about relative performance may derived and tested.