How the Neocons Chose Hegemony Over Peace

Commentary by Jeffrey D. Sachs

In 1999, when Vladimir Putin became Prime Minister and in 2000 when he became President, Putin sought friendly and mutually supportive international relations between Russia and the West. Many European leaders, for example, Italy’s Romano Prodi, have spoken extensively about Putin’s goodwill and positive intentions towards strong Russia-EU relations in the first years of his presidency.

Looking back on the events around 1991-93, and to the events that followed, it is clear that the US was determined to say no to Russia’s aspirations for peaceful and mutually respectful integration of Russia and the West. The end of the Soviet period and the beginning of the Yeltsin Presidency occasioned the rise of the neoconservatives (neocons) to power in the United States. The neocons did not and do not want a mutually respectful relationship with Russia. They sought and until today seek a unipolar world led by a hegemonic US, in which Russia and other nations will be subservient.

In September 1991, I was contacted by Yegor Gaidar, economic advisor to Boris Yeltsin. He requested that I come to Moscow to discuss ways to stabilize the Russian economy. At that stage, Russia was on the verge of hyperinflation, financial default to the West, collapse of international trade, and intense shortages of food in Russian cities resulting from the collapse of food deliveries from the farmlands and pervasive black marketing of foodstuffs and other essential commodities.

In November 1991, Gaidar met with the G7 Deputies (the deputy finance ministers of the G7 countries) and requested a standstill on debt servicing. This request was flatly de­nied. To the contrary, Gaidar was told that unless Russia continued to service every last dollar as it came due, emergency food aid on the high seas heading to Russia would be immediately turned around and sent back to the home ports. I met with an ashen-faced Gaidar immediately after the G7 Dep­uties meeting.

In December 1991, I met with Yeltsin in the Kremlin to brief him on Russia’s financial crisis and on my continued hope and advocacy for emergency Western assistance, especially as Russia was now emerging as an independent, democratic nation after the end of the Soviet Union. He requested that I serve as an advisor to his economic team, with a focus on attempting to mobilize the needed large-scale financial support. I accepted that challenge and the advisory position on a strictly unpaid basis.

Upon returning from Moscow, I went to Washington to call for a debt standstill, a currency stabilization fund, and emergency financial support. In my meeting with Mr. Rich­ard Erb, Deputy Managing Director of the IMF in charge of overall relations with Russia, I learned that the US did not support this kind of financial package. I pleaded the economic and financial case, and was determined to change US policy.

Indeed, during 1991-94 I would advocate non-stop but without success for large-scale Western support for Russia’s crisis-ridden economy, and support for the other 14 newly independent states of the former Soviet Union. I made these appeals in countless speeches, meetings, conferences, op-eds, and academic articles. Mine was a lonely voice in the US in calling for such support. I had learned from economic history—most importantly the crucial writings of John Maynard Keynes (especially Economic Consequences of the Peace, 1919)—and from my own advisory experiences in Latin America and Eastern Europe, that external financial support for Russia could well be the make or break of Russia’s urgently needed stabilization effort.

When the German and Hapsburg Empires collapsed after World War I, the result was financial chaos and social dislocation. Keynes predicted in 1919 that this utter collapse in Germany and Austria, combined with a lack of vision from the victors, would conspire to produce a furious backlash towards military dictatorship in Central Europe. Even as brilliant a finance minister as Joseph Schumpeter in Austria could not stanch the torrent towards hyperinflation and hyper-nationalism, and the United States descended into the isolationism of the 1920s under the “leadership” of Warren G. Harding and Sen. Henry Cabot Lodge.

The Cold War and the collapse of communism left Rus­sia as prostrate, frightened and unstable as was Ger­many after World War I and World War II. Inside Russia, West­ern aid would have had the galvanizing psychological and political effect that the Mar­shall Plan had for Wester Eur­ope. Rus­sia’s psyche has been tormented by 1,000 years of brutal invasions, stretching from Genghis Khan to Napo­leon and Hitler.

Russia’s economic crisis worsened rapidly in 1992. Gai­­dar lifted price controls at the start of 1992, not as some purported miracle cure but be­cause the Soviet-era official fixed prices were irrelevant under the pressures of the black markets, the repressed inflation (that is, rapid inflation in the black-market prices and therefore the rising the gap with the official prices), the complete breakdown of the Soviet-era planning mechanism, and the massive corruption engendered by the few goods still being exchanged at the official prices far below the black-market prices.

At the end of 1992, after one year of trying to help Rus­sia, I told Gaidar that I would step aside as my recommendations were not heeded in Washington or the European capitals. Yet around Christmas Day I received a phone call from Russia’s incoming financing minister, Mr. Boris Fyodorov. He asked me to meet him in Washington in the very first days of 1993. We met at the World Bank. Fyodorov, a gentleman and highly intelligent expert who tragically died young a few years later, implored me to remain as an advisor to him during 1993. I agreed to do so, and spent one more year attempting to help Russia implement a stabilization plan. I resigned in December 1993, and publicly announced my departure as advisor in the first days of 1994.

The failure of the West to provide large-scale and timely financial support to Russia and the other newly independent nations of the former Soviet Union definitely ex­acerbated the serious economic and financial crisis that faced those countries in the early 1990s. Inflation re­mained very high for several years. Trade and hence economic recovery were seriously impeded. Corruption flourished under the policies of par­celing out valuable state assets to private hands. Even with all of these economic debacles, and with Russia’s default in 1998, the grave economic crisis and lack of Western support were not the definitive breaking points of US-Russian relations.

It was in military affairs rather than in economics that the Russian—Western relations ended up falling apart in the 2000s. As with finance, the West was militarily dominant in the 1990s, and certainly had the means to promote strong and positive relations with Russia. Yet the US was far more interested in Russia’s subservience to NATO than it was in stable relations with Russia.

At the time of German reunification, both the US and Germany repeatedly promised Gorbachev and then Yeltsin that the West would not take advantage of German reunification and the end of the Warsaw Pact by expanding the NATO military alliance eastward. Both Gorbachev and Yeltsin reiterated the importance of this US-NATO pledge. Yet within just a few years, Clinton completely reneged on the Western commitment, and began the process of NATO enlargement. Leading US diplomats, led by the great statesman-scholar George Kennan, warned at the time that the NATO enlargement would lead to disaster: “The view, bluntly stated, is that
expanding NATO would be the most fateful error of Amer­ican policy in the entire post-cold-war era.” So it has proved.

Here is not the place to revisit all of the foreign policy disasters that have resulted from US arrogance towards Rus­sia, but it suffices here to mention a brief and partial chronology of key events. In 1999, NATO bombed Belgrade for 78 days with the goal of breaking Serbia apart and giving rise to an independent Kosovo, now home to a major NATO base in the Balkans. In 2002, the US unilaterally withdrew from the Anti-Ballistic Mis­sile Treaty over Russia’s strenuous ob­jections. In 2003, the US and NATO allies repudiated the UN Security Coun­cil by going to war in Iraq on false pretenses. In 2004, the US continued with NATO enlargement, this time to the Baltic States and countries in the Black Sea region (Bulgaria and Romania) and the Balkans. In 2008, over Rus­sia’s urgent and strenuous objections, the US pledged to ex­pand NATO to Georgia and Ukraine.

In 2011, the US tasked the CIA to overthrow Syria’s Bashar al-Assad, an ally of Russia. In 2011, NATO bombed Libya in order to overthrow Moammar Qaddafi. In 2014, the US conspired with Ukrainian nationalist forces to overthrow Ukraine’s President Viktor Yanukovych. In 2015, the US began to place Aegis anti-ballistic missiles in Eastern Europe (Rom­a­nia), a short distance from Russia. In 2016-2020, the US supported Ukraine in undermining the Minsk II agreement, despite its unanimous backing by the UN Security Council. In 2021, the new Biden Administration refused to negotiate with Russia over the question of NATO enlargement to Ukraine. In April 2022, the US called on Ukraine to withdraw from peace negotiations with Russia.

In this US-led world order, the neocons envisioned that the US and the US alone will determine the utilization of the dollar-based banking system, the placement of overseas US military bases, the extent of NATO membership, and the deployment of US missile systems, without any veto or say by other countries, certainly including Russia. That arrogant foreign policy has led to several wars and to a widening rupture of relations between the US-led bloc of nations and the rest of the world. As an advisor to Russia during two years, late-1991 to late-93, I experienced first-hand the early days of neoconservatism applied to Russia, though it would take many years of events afterwards to recognize the full extent of the new and dangerous turn in US foreign policy that began in the early 1990s.

Jeffrey D. Sachs is an American economist and public policy analyst who is a professor at Columbia University.

Source: jeffsachs.org, September 4, 2024