In the panic, trade union officials and Communist Party leaders fear that they might lose the support of their constituencies who would turn to more radical political groups in times of crisis. Even Yeltsin appeared to be worried about these extremists when he issued a warning in the early part of July to potential non-democratic challengers that his regime had enough military force to defeat any coup attempt. Regarding Russian economic reform, the Clinton Administration demonstrated leadership in responding aggressively to Russia's latest financial crisis. Though imprudent as an economic decision, the bailout helped to prevent a political exposition in Russia that would have made everyone worse off. Clinton must now follow up this bailout package with a tough-love message that no future bailouts will be forthcoming.
Further delay is out of the question.
The state must also sell the stakes it still holds in hundreds of enterprises. After delivering this hard message to Yeltsin and his government, Clinton should consider delivering a softer more sympathetic message to the Russian people who have not experienced the rewards of reform. At a factory or veteran's club outside of Moscow, Clinton could try to explain why the United States still believes that economic reform in Russia will succeed and then announce a new assistance package aimed specifically at helping those hit hardest by Russia's economic depression. To date, the West's efforts at building a social safety net in Russia have been embarrassing. When in Moscow, Clinton must deliver a private but firm message to Yeltsin and other Russian elites about the negative consequences of circumventing the democratic process.