Russian President Vladimir Putin appears to have made a strategic decision to reorient Russiannational security policy from a posture of antagonism, if not hostility, toward the United States andits allies, to a policy of more cooperation with the United States and the West. Indications of thisshift were discernible even before the terrorist attacks of September 11. But Putin seized uponSeptember 11 as an opportunity to transform dramatically the bilateral relationship along cooperativelines, making that date appear to be a real turning point in U.S.-Russian relations. Among the more notable results of this shift in Russian national security policy were: Russia's political and military cooperation with the U.S. campaign against the Taliban regime in Afghanistan,including U.S. military deployments in former Soviet states in Central Asia; Moscow's decision toclose its electronic intelligence base in Cuba; and the softening (nearly to the point of abandonmentin some cases) of Russia's previously tough positions on NATO enlargement, the ABM Treaty,missile defense, and strategic nuclear force reductions. This report will examine the implications of the shift in Russian national security policy for near-term U.S.-Russian relations and for broader U.S. security interests. It will seek to show themotives behind Putin's decision to reorient Russian policy and assess the prospects for the newpolicy's endurance. This report will also examine the Bush Administration's response(s) to the newRussian policy, congressional interests and congressional levers to influence U.S. policy towardRussia, as well as competing opinions on what U.S. policy toward Russia should be. President Putin is the unchallenged - and seemingly unchallengeable - master of the Russianpolitical scene today. He has no credible political rivals and has enjoyed consistently high standingin Russian public opinion polls (over 70% approval rating) for more than two years. Yet fewforesaw these developments in August 1999, when a physically and politically exhausted PresidentYeltsin plucked Putin from political obscurity to become Russia's fifth Premier in two years. Priorto the premiership, Putin had headed the FSB, Russia's internal security agency for a year (July1998-August 1999), and before that had been a nearly invisible, though increasingly influential, bureaucrat in the Presidential Administration (1996-1998). Many in Russia and the West initiallyviewed Putin as a political lap dog for Yeltsin. (1) Within days of becoming premier, Putin confronteda crisis involving the breakaway republic of Chechnya and terrorist bomb attacks in Russia. Putinadopted a very tough policy toward Chechnya, which he rode to popularity and power. Yeltsinabruptly resigned as President on December 31, 1999 (six months before the expiration of his term),naming Putin Acting President. Three months later (March 26, 2000), Putin was elected Presidentin his own right. The national security policy that Putin inherited from Yeltsin, and that he continued to pursue for a year or more after succeeding Yeltsin, was shaped by Yevgeny Primakov, who served asForeign Minister and then Premier in the late 1990s. (2) Primakov was loath to relinquish Moscow'srole and status as a great power. He saw the United States as Russia's natural, inevitable foe. Inview of Russia's diminished economic, political, and military means, Primakov sought to build anundeclared coalition of states, with Russia at its head, to oppose what he saw as U.S. globaldomination. He called this a policy of "multi-polarity." Primakov viewed China, India, and Iran askey partners and sought support among other states that opposed U.S. policy and/or resented U.S.power. In December 1998, as U.S. and British planes bombed Iraq in a dispute over U.N. armsinspections, Primakov called for a Russia-China-India alliance to oppose U.S. "global hegemonism." This was the essence of Primakov's vision of Russian national security policy - a Eurasian-basedstrategy of coalition politics, led by Russia, aimed at diminishing U.S. influence and thwarting(most) U.S. goals, worldwide. (3) During Putin's first year in power, while dealing with the initial military phase of the conflictin Chechnya and consolidating his domestic political position, the new Russian leader showed somesigns of flexibility on national security policy but seemed mainly to continue along the path laid outby Primakov. (4) But after a year or so - by mid-2001at the latest, i.e., before September 11 - Putinappeared to be moving away from the Primakov vision. After September 11, it became clear thatPutin was moving Russia in a different direction. The first meetings between Presidents Bush and Putin (their brief meeting in Slovenia in June 2001 and a month later at the G-8 summit in Genoa, Italy) were notable for the emphasis (in public,at least) on personal rapport over political substance. Much was made of President Bush's assertionthat he had "looked into" Putin's "soul" and found him "to be very straightforward and trustworthy." Putin responded publicly with praise for the new and untested U.S. President. It is not clear whether,and/or to what extent, the softening of Russian policy toward the United States may have beeninfluenced by personal rapport between the two leaders. Some believe that Putin, a career KGBforeign intelligence officer, was unlikely to be swayed by such ephemera as personal chemistry andhad made up his mind in advance to seek a friendly relationship with Bush and improved relationswith the United States. Even before September 11, there was softening of Russia's previously outspoken opposition to U.S. missile defense plans and to the U.S.-backed accession to NATO of the former Soviet Balticrepublics of Estonia, Latvia, and Lithuania. Putin may have concluded there was an inevitabilityrelated to U.S. missile defense and NATO enlargement and sought to moderate the outcomes asmuch as possible, if only marginally, rather than continuing to fight and gain nothing in the process. This could be seen in Moscow's abandonment of its "red line" rhetoric regarding Baltic accessionto NATO (5) and its movement toward modifying theABM Treaty. September 11, however, seemedto provide a turning point or breakthrough in U.S.-Russian relations. Immediately after the September 11 attacks, it was obvious that if the United States was going to take action against Al Qaeda and its host, the Taliban regime in Afghanistan, Russian cooperationwould be very valuable, perhaps indispensable. Many observers initially assumed that Moscowwould adopt a tough position along the following lines: Now the Americans need us. Very well,what is the most that we can extract from them and the minimum cooperation that we must offer inreturn? This assumption was based on the belief that Putin, the ex-KGB agent, viewed the UnitedStates negatively, only grudgingly had begun to soften Russian policies, and would gladly revert toa harder line once the September 11 attacks had strengthened his hand. (6) Events showed that Putintook a different view. He appears to have decided immediately after the terror attacks to seize uponthose epochal events as an opportunity to transform U.S.-Russian relations. Although Putin may have decided to move Russia closer to the United States before September 11, the Bush Administration did not appear eager to reciprocate at that time. To the contrary, mostof the Administration's top agenda items regarding Russia were negative issues for Moscow: missiledefense; the ABM Treaty; NATO enlargement; Russian transfers to Iran of nuclear reactors, missiletechnology, and conventional arms; Russian support of Iraq; Russian abuses in Chechnya; andsuppression of press freedom in Russia. September 11 gave Putin the opportunity to change thesubject. The new dominant issue would be cooperation against international terrorism. Since late1999, Putin had been trying to interest Washington in the idea of joint action against terrorism as thenew core issue for bilateral cooperation. Neither the Clinton nor the Bush Administration wasreceptive to this, in view of Putin's claim that his military campaign in Chechnya was a primeexample of anti-terrorism in action. On September 11, only hours after the attacks, Putin, using the hot line, was the first world leader to speak to Bush, in Air Force One, about the tragedy. Putin reminded Bush that Russia hadsuffered a series of dreadful terrorist bombing attacks against apartment buildings in Moscow andother cities two years earlier that had killed hundreds of Russians. Putin attributed those attacks toradical Islamic Chechen terrorists. (7) Beyond personaland official condolences, Putin informed hisAmerican counterpart that he was ordering the immediate cancellation of military exercisesscheduled to begin the next day that included long-range bomber flights in the direction of the UnitedStates, Canada, Great Britain, Norway, and Iceland. Sailing orders for Russian submarine andsurface naval units were also cancelled. (8) He mayhave wished to avoid false alarms. In a somberspeech to the Russian people, Putin compared the September 11 attacks to Nazi atrocities, whichsome observers took as a sign of Putin preparing the public for a possibly dramatic shift in Russianpolicy, i.e., strategic cooperation with the United States. Within days, the Bush Administration began to focus on action against Al Qaeda and the Taliban regime. The possibility of U.S. military deployments in Central Asia was prominentlymentioned by U.S. officials and in the press. The immediate response from Russian officials wasstrongly negative. Even Defense Minister Sergei Ivanov, perhaps Putin's closest political associate,said on September 16 that there were "no prospects" for U.S. military forces to operate in any of theC.I.S. states. Putin personally intervened to change that policy. He publicly contradicted his defenseminister and declared that U.S. military deployments in Central Asia could be viewed positivelyunder certain circumstances. U.S. Air Force and Special Forces units reportedly began flying toUzbekistan and Tajikistan on September 19. (9) There are divergent accounts of Moscow's initial role in the U.S. deployments to Central Asia. Some say that at first Russian officials tried to prevent Central Asian leaders from offeringWashington military bases on their territory. Others say that Moscow facilitated, or at least did notstand in the way of, the U.S. deployments. (10) Perhaps there is some truth in both accounts, reflectingearly divisions in Moscow on this issue. Ultimately, Russia could not prevent sovereign states inCentral Asia from hosting U.S. military forces if they saw it as in their interest to do so, which wasclearly the case in Uzbekistan. But Russian influence in Tajikistan is very strong, and some say thatU.S. deployments there would not have been possible if Moscow had objected strongly. (11) The factthat U.S. combat forces were deployed in large numbers to military bases in Central Asian Sovietsuccessor states would have been unimaginable a few months earlier. Regardless of his own initialreaction to this development, Putin put the best face on it, offering political and logistical assistance. Russian cooperation in the campaign against the Taliban was not based solely on a desire to draw closer to the United States. Moscow had long viewed the Taliban as a serious threat to Russiansecurity because of that regime's role in promoting the spread of radical Islam in Central Asia. Thiswas an immediate threat to the secular Central Asian regimes along Russia's southern frontier, whichmight ultimately destabilize Russia's own large Muslim population. (12) To counter Taliban-supportedinsurgency, Russia provided covert and open support to the anti-Taliban Northern Alliance. Despitea five-year Russian effort, however, the Taliban had expanded its control to over 90% of Afghanterritory by September 2001 and squeezed the Northern Alliance into a small pocket near theAfghan-Uzbek border. Thus, U.S. operations in Afghanistan after September 11 served a doubleinterest for Moscow: the opportunity to demonstrate concrete strategic cooperation with Washington,and the elimination of a serious security threat on its vulnerable southern flank. Russian support for the U.S.-led campaign in Afghanistan was not limited to the deployment of coalition forces in Central Asia. Russia greatly increased its arms supplies to the NorthernAlliance, including heavy weapons such as tanks, artillery and helicopters. In addition, Russianmilitary specialists such as tank commanders, artillery officers, pilots, and other skilled personnelwere attached to Northern Alliance forces during the decisive operations in October-November 2001. U.S. Defense Department officials credit these Russian efforts with having contributed substantiallyto the rapid defeat of the Taliban in the North. (13) At the same time that Moscow was giving Washington unprecedented cooperation in Afghanistan, it was showing a willingness to compromise on missile defense, the ABM Treaty, andstrategic force reductions. In mid-November, in the run-up to the Bush-Putin summit in Washingtonand Crawford, Texas, U.S. and Russian media carried reports of a possible negotiating breakthroughthat might result in a big "package deal" on these issues. (14) These reports proved premature, however,because the United States did not back off many of its demands and positions. The Novembersummit yielded few major substantive results and three weeks later Bush announced that the UnitedStates would unilaterally withdraw from the ABM Treaty. Putin, while "regretting" the U.S.decision, insisted that it was "not a tragedy," and that it would not destabilize otherwise excellentbilateral relations. As with NATO enlargement, Putin appears to have decided that it was futile tocontinue trying to resist the inevitable, and that Russian interests were best served by minimizingthe damage on missile defense and the ABM Treaty and by getting the best deal he could on strategicnuclear force reductions. On this, too, Putin eventually yielded on virtually all substantive pointsin the Treaty on Strategic Offensive Reductions (Treaty of Moscow) signed on May 24, 2002. (15) During this evolution on strategic nuclear issues, another significant indication of Putin's shift in national security strategy received relatively little public attention. On October 17, 2001, Putinannounced that Russia would close its electronic intelligence base at Lourdes, Cuba. This listeningpost, established in 1964, was Moscow's largest and most important intelligence facility outside itsborders and was considered a thorn in the side by the United States. (16) To the extent that Russiaviewed the United States as an adversary, the base at Lourdes, which was manned by 1,500 Russiansand provided 60%-70% of Russia's electronic intelligence data on the United States, was asignificant strategic asset. The decision to close it was more than a symbolic move; it was a strategicdecision. (17) Other aspects of Russian defense policy under Putin support the idea of a shift away from confrontation toward cooperation with the United States and the West. One of the most significantmoves was Putin's decision (August 2000) that Russia's strategic nuclear forces would beunilaterally reduced from nearly 6,000 deployed warheads to 1,500 in this decade. (18) Thisacknowledgment of Russia's inability or unwillingness to maintain quantitative parity with theUnited States in strategic nuclear forces was a significant step. In 2001, the Ministry of Defenseannounced plans to further reduce Russian military manpower from 1.2 million to 850,000. In 2002,the government announced plans to accelerate the transition from a mainly conscript to a mainlyprofessional army. In the long-run, a smaller professional force may be more capable in manyrespects than a mass conscript army. But mass was traditionally the Russian Army's strong suit andthe basis of its presumed offensive capability vis-a-vis NATO. In the early 1990s, Russian defense spending was cut drastically and procurement of major new weapons systems virtually came to a halt. (19) Thegovernment's fiscal situation improved substantiallyafter 1999 and defense spending has increased somewhat, but the increment has gone mostly to paymilitary salaries. Large-scale serial production of major weapon systems has not yet resumed. (20) In the late 1990s, into the early stage of Putin's presidency, Russian military exercises were given an almost ostentatiously anti-NATO, anti-American edge. This tendency has been reducedsince September 11. Also, in the past two years, Putin has instituted major personnel changes in themilitary high command, removing a number of outspoken advocates of anti-western, anti-U.S.military policies. (21) The case of the Russian nuclear submarine Kursk, which sank on August 12, 2000, sheds light on the shift in Russian defense policy in several respects. The military exercise in which the Kursk sank was the prelude to sending a powerful Russian flotilla into the Mediterranean, reportedly meant"to send NATO a signal of Russia's intention to maintain a 'blue-water' offensive naval strategy." (22) The Mediterranean deployment was cancelled. Most of the Russian military establishment claimedthat the Kursk sank after colliding with a U.S. or British submarine and stuck to that story for morethan a year. In July 2002, the Russian government released an official report that a faulty torpedohad exploded inside the Kursk . In the meantime, Putin replaced the Commander and DeputyCommander of the Northern Fleet, the Navy Chief of Staff, and the Minister of Defense, amongothers. In a televised interview soon after the Kursk sank, Putin said that, "[O]ur armed forcesshould match our needs on one hand and the possibilities of the state on the other," adding that themilitary must be "compact, modern and well paid.... We have been talking about military reform forhow long? At least eight years and perhaps a whole ten years, but there has been little change in thisarea." (23) After the Kursk , Putin beganto make changes. That was thirteen months before September11, 2001. Soon after September 11, a somewhat skeptical Polish analyst wrote that there were two key questions in judging Putin's policy. The first was whether Russia really sought full-fledgedcooperation with the West; the second was the price of such cooperation. "Russian participation inan anti-terrorist offensive," he continued, "together with only moderate demands in return, might bea substantial indication of Russian preparedness to become a reliable partner of the West. It is examtime and we can only hope that Russia will not fail." (24) Putin appears to have passed this test. If Putin really has fundamentally reoriented Russian policy toward cooperation and integration with the West, one may well ask why. Does the former KGB agent have a cultural or ideologicalaffinity for the United States and the West? I.e., does he like us? Does he like westerndemocracy? Most observers would say, "no." Instead, Putin's change of course seems to be based on a soberassessment of Russia's vital interests and its current limitations. First and foremost, from the day Putin became Acting President to the present time, he has insisted that Russia's most urgent need and his top priority is the reconstruction and vitalization ofthe economy. In a speech on December 13, 1999, he warned that, "Russia is in the midst of one ofthe most difficult periods in its history. For the first time in 200 or 300 years, it is facing a real threatof sliding to the second, possibly the third, echelon of world states." The catastrophic economiccollapse of the 1990s had to be reversed in order to ensure the strength of the state, the dignity andwell-being of the Russian people... and Putin's political future. Putin established as a primary goalfor Russia the transition to a functioning market economy whose gross domestic product (GDP) wasgrowing at a healthy, sustainable rate. This would assure rising living standards for Russian citizensand provide the basis for a strong central state. Putin sees Russia's economic reconstruction and vitalization proceeding from its integration in the global economic system dominated by the advanced industrial democracies, i.e., economicintegration with the West. He said this clearly in his April 2002 State of the Nation address. "I mustonce again make a firm statement today on our priorities as far as Europe is concerned.... [W]hat isclear are our... numerous and concrete steps towards integration with Europe. We will continue towork actively with the European Union, designed to create a single economic space." (25) It isaxiomatic that this requires a relatively benign international environment for Russia. Russia'seconomic integration with the West cannot be accomplished in an atmosphere of political/militaryconfrontation or antagonism with the West and/or with the United States. It follows from this that Russian national security policy must support Russia's preeminent economic objectives. Putin underlined this point in a conference of Foreign Ministry officials,including virtually all ambassadors, who were ordered to Moscow for the purpose (July 12, 2002). This was the second such conference in the 202-year history of the Foreign Ministry. The first wasconvened by Mikhail Gorbachev in 1986 to lay down his principles of "new thinking" in foreignpolicy and of "glasnost" and "perestroika." Putin also intended to lay down new principles. Helectured the assembled foreign policy bureaucracy, criticizing them on various shortcomings, andnoted that under his leadership, "Russia has managed to get out of the long period of confrontation"and now sought "truly reliable, businesslike" relations. He went on to say that the new basis ofRussian-U.S. relations "lies in a new reading of the national interests of the two countries...." Lestthey miss the point, he declared, "I will reemphasize: the confident partnership between Russia andthe U.S.A. is not only in the interests of our people. It exerts a positive influence on the entiresystem of international relations and therefore remains one of our absolute priorities ." (26) (Emphasisadded.) General Vasily Lata, former Deputy Commander of Russian Strategic Rocket Forces, putit more bluntly. "Economic policy is dictating all the other aspects of international relations.... Putinsees that without positive economic development, Russia has no future." (27) Putin's drive for economic integration with the West alone may be sufficient explanation for his abandonment of the Primakov line and his reorientation of Russian national security policytoward cooperation with the West. But there are probably other factors as well. Putin is known asa realist. He is intelligent and well informed. He has first-hand understanding of the West, havingserved for years as an intelligence officer in Germany. Many observers believe that underlyingPutin's frequent assertion that Russia must adjust its foreign and defense policies to its (limited)capabilities is his conclusion that Primakov's concept - of maintaining Russia's status as a greatpower and the leader in the struggle against American "hegemonism." - was a losing strategy inview of the preponderance of U.S. economic, political, and military power compared to Russia. (28) Putin may also have had doubts about the wisdom of Primakov's reliance upon China as a key partner and preferably an ally, vis-a-vis the United States. Russian-Chinese relations are friendly andthe two states share a number of important interests, including: opposition to U.S. or internationalinterference in a country's internal affairs on the basis of human rights violations; opposition to thespread of radical Islam in Central Asia; mutual support in suppressing separatist tendencies inChechnya and Tibet; and resentment of the economic dominance of the advanced industrialdemocracies. Both states felt threatened by proposed U.S. missile defense plans and by the principleof U.S.-led military intervention in Yugoslavia's Kosovo conflict without U.N. or OSCE approval. (29) As both China's and Russia's relations with the United States soured in the late 1990s and into thefirst year of the Bush Administration over these and other issues, (30) Russo-Chinese condemnationsof "global hegemonism," a thinly veiled reference to U.S. dominance and unilateralism, seemed tosome to be moving in the direction of alliance against the United States, as envisioned byPrimakov. (31) There is ample reason, however, for Moscow to be wary of such a policy. While Primakov and like-minded Russian nationalists saw China as an opportunity to be exploited in the short-term tocounterbalance U.S. predominance, other Russians saw - and see - China as a long-term threat. Thebasic reasons for this are the apparent trajectories of Russian decline and Chinese ascendance andRussian concerns about a possibly dangerous China as a neighbor in the future. Russia is by far thelargest nation in the world in terms of territory, but whereas the Soviet population in 1991 was 286million, Russia's population then was only 149 million. Today it stands at 144 million - despitesubstantial net in-migration of ethnic Russians from other Soviet successor states - and it is fallingrapidly. Russia is experiencing an extraordinary demographic crisis. Putin frankly acknowledgesthis as one of Russia's most urgent problems. In April 2002, the Russian State Committee onStatistics ( Goskomstat ) published its official projections for the population of the Russian Federationin the year 2050. There were three variants: optimistic - 126 million; pessimistic - 77 million; andmedian (presumably the most realistic official estimate) - 100 million. (32) Furthermore, the RussianFar East and Eastern Siberia, that huge expanse east of Lake Baikal, a territory larger than thecontiguous 48 United States, has a population of barely 6 million, which is contracting more rapidlythan the general population as Russians migrate back toward the European heartland to escape harshclimatic and economic conditions. In contrast, China's population today is about 1.3 billion, and growing. China faces a perceived scarcity of land and resources. Much of resource-rich Eastern Siberia and the Russian Far East wasseized from China by Tsarist Russia in the second half of the 19th century, in what the Chinese call"unequal treaties." Nearly all the territory yielded by China to other imperialist states (notably:Britain, France, Germany, and Japan) in 19th and 20th century "unequal treaties" hasbeen recoveredby China. Russia is the outstanding exception. The giant Asian neighbors have officially resolvedvirtually all territorial issues along their 3,000 mile border and they have concluded numerous otheragreements, including a 25-year Friendship Treaty signed in July 2001. They have important,mutually beneficial trade relations. Both parties want and need continued friendly relations in thenear- and medium-term future as they focus on domestic development. Many Russians worry,however, that eventually China could become a threat. Russian concerns about China tend to focus on the possibility of China becoming a superpower with sustained economic growth that eventually generates great political and military power,vis-a-vis a relatively weak Russia. China experts are by no means agreed that China will continueto enjoy rapid economic growth and become a superpower. Another school of thought foreseesstagnation, economic decline, and instability for China. (33) Curiously, this scenario too is a source ofconcern for Russia. In a troubled and unstable China, there could be uncontrolled populationmovement toward Russia's sparsely populated eastern regions. More worrisome for Moscow is theprospect that the Chinese Communist Party - or its successor - having already virtually abandonedMarxist-Leninist ideology as a legitimizing principle, might turn to patriotic nationalism as a meansof maintaining political legitimacy and national cohesion. Increased Chinese nationalism couldrevive territorial claims against Russia - as Mao did in the 1960s-1970s. Thus, it is arguable thatwhether China evolves into a superpower, or fails in its transition and becomes a troubled, unstablestate, the prospects for Russia in either case could be disturbing. (34) This may be another reason whyPutin turned away from Primakov's policy of reliance on China against the United States. Someanalysts suggest that eventually, Moscow may have to turn to the United States and NATO forsecurity against China. In the first two years after the collapse of the Soviet Union, Russian national security policy seemed remarkably (critics would say, naively) pro-American. Yeltsin and his Foreign MinisterAndrei Kozyrev seemed to say to the United States, "Just tell us what you want...." By late 1993,this began to change. The continued sharp contraction of the economy and commensurateimpoverishment of much of the population eroded Yeltsin's popularity. His erratic, undisciplined,hands-off leadership style made things worse. Communists and ultra nationalists dominated theDuma through the mid- to late 1990s. This political opposition and a rising Russian disillusionmentwith perceived U.S. unresponsiveness to Russian needs and interests gave rise to increasingassertiveness and nationalism in Russian foreign and defense policy. In January 1996, Yeltsinappointed Primakov to replace the pro-western Kozyrev, and U.S.-Russian relations became morestrained. Many observers in Russia, Europe, and the United States caution that Putin's new national security policy, like Yeltsin's a decade earlier, lacks solid domestic political support. Indeed, thedominant view among Russian specialists is that the new policy is so much Putin's policy that it isvirtually a one-man show. Some say that Defense Minister Sergei Ivanov, a Putin loyalist, is perhapsthe only senior leader who truly embraces the policy. (35) Senior military leaders, the Foreign Ministrybureaucracy, the majority of political elites - and indeed much of the general population - is said tobe opposed to, or not very supportive of, the policy of cooperation with the United States. (36) Somespecialists dispute this view, claiming that even "most conservative political elites, in privatediscussions , admit that Putin's course of integration with America and the West is the only way tomodernize the economy." (Emphasis added.) According to the same source, "although Putinpersonally makes key decisions, there is an impressive brain trust behind the president... a talentedand deep cadre in the Russian bureaucracy that supports the president's policy toward the UnitedStates." (37) While there may be uncertainty about the level of political support for Putin's policy of integration with the West, there is little doubt about his overall political strength and popularity. Asnoted above, Putin is the unrivaled master of the Russian political stage and continues to enjoypublic approval ratings over 70%. (38) Putin wasfortunate to come to power near the beginning of aneconomic upturn. The Yeltsin regime's attempt to implement a rapid transition from the mostmilitarized command economy in history to a rudimentary market system led to a recession in whichoutput fell by 40%-50%, followed by a financial crisis in 1998. After the financial crisis, the sharplydevalued ruble and major increases in the world price of oil spurred a mini economic boom in Russia(1999 to 2001). Domestically, Putin got political credit for the improving economy. He then seizedthis opportunity to adopt an ambitious - and potentially risky - reform strategy. The first elementof that strategy is domestic economic reform. The second element is integration into the globaleconomy. The third element is strategic partnership with the United States and the West. (39) If it istrue that the public is not generally supportive of his pro-western policy, this is not reflected in anydecrease in his popularity or political effectiveness. Putin successfully has extended government control over the principal broadcast media. He has curbed the power of the previously independent business "oligarchs" as a class, driving some of theminto exile and neutralizing or winning the support of others. Putin has enjoyed strong support in theDuma since the beginning of his presidency. The Communist Party of the Russian Federation(CPRF) is the only major party that opposes his shift toward cooperation with the United States. InApril 2002, the dominant pro-Putin bloc in the Duma staged a political coup, stripping the CPRF ofmost of its committee chairmanships and other leadership posts. (40) Now there appears to be noeffective parliamentary opposition to Putin's domestic or foreign policies. Furthermore, the RussianConstitution (tailored to Yeltsin's specifications in late 1993, after he forcibly disbanded theprevious parliament), concentrates political power in the President's hands to such an extraordinarydegree that Russia is a "super-presidential" republic. The institutional power of the presidency,combined with Putin's personal prestige and popularity, are such that there is no significant politicalopposition in Russia today. At present, there is no effective means of translating unhappiness withPutin's pro-western course into political pressure that could force him to change that policy - as longas he personally believes in it. Those who are concerned about the lack of support for Putin's pro-western policy caution, however, that Russia's large and unwieldy government bureaucracy could find many ways to delay,obstruct, undermine, and sabotage that policy. As the shift in Russian national security policy became evident in 2001, some in the United States saw it as a short-term tactical response to the September 11 attacks and their aftermath. In thisview, a principal goal of Putin was to assure that Russia was on the right side of - and not targetedor jeopardized by - any U.S.-led anti-terrorist operations and also to channel the upsurge of U.S.anti-terrorism sentiment into support for Russia's campaign in Chechnya. As Putin's policy hasevolved, however, most analysts have come to see it as a fundamental strategic reorientation ofRussian policy, based on Putin's assessment of Russian national interests - domestic economic aswell as geostrategic. Those who see the new Russian policy as a strategic decision argue that the numerous changes of position that Putin has made on major issues in relations with the United States are cumulativelyso substantial that they seem too high a price to pay in exchange for some short-term tacticalobjective(s). Putin has declared repeatedly that Russia's economic future is tied to its integrationwith the West. The bulk of his domestic economic and national security policies point in thatdirection. Many of the above concessions that Moscow made to Washington in the past year couldbe difficult or impossible to reverse. The change in Russia's strategic relationship with China may also fall into this category. Although the Chinese and Russian governments do not say so officially, there can be little doubt thatBeijing was and is displeased with Putin's turn away from the Primakov policy of strategiccooperation with China, toward integration with the West (see p. 29-30, below). From the Chineseperspective, this was the third time in five years that Moscow had "surrendered" to the West afterinitially declaring strong opposition to western policy. The first case was the accession to NATOof Poland, Hungary, and the Czech Republic. From 1995 to 1997, Moscow insisted that taking theformer Warsaw Pact states into NATO would poison East-West relations, with dire political andmilitary consequences. In the end, Yeltsin acquiesced, flew to Paris, and signed the NATO-RussiaFounding Act (May 27, 1997). (41) The second perceived "surrender" was over the U.S.-led NATO military intervention in Yugoslavia during the Kosovo conflict. Moscow consistently took the Serbian side, to the point thatthe NATO air war precipitated a crisis with Russia in the spring of 1999. Russia enlisted Chinesesupport in this clash with the West. After U.S. planes accidentally bombed the Chinese Embassyin Belgrade, China became even more strongly committed to this cause. In the end, however,Moscow decided to join in the NATO pressure on Yugoslav President Slobodan Milosevic to acceptNATO's terms on Kosovo. (42) In the Chinese opinion, the third "surrender," Putin's post-September 11 concessions to the United States, is more sweeping and strategic in scope. Again, Moscow had made a point ofsoliciting Chinese support for resistance to U.S. missile defense plans and in support of the ABMTreaty, and then abandoned that policy - and China. Moscow and Beijing also had emphasized theirstrategic cooperation in co-sponsoring the Shanghai Cooperation Organization (SCO, July 2001),an underlying, though undeclared, principle of which was Sino-Russian cooperation to thwart U.S.influence in Central Asia. (43) Within months,Russia cooperated with U.S. military deployments toCentral Asia, into states bordering on China's sensitive western frontier. Moscow did not consultwith Beijing prior to this move. (44) The fact that Putin and Bush cemented their post-September 11 strategic cooperation in a private meeting during the APEC Conference in Shanghai (October 2001) may have seemed afurther affront to the Chinese. By demonstrating, yet again, Russia's unreliability as a partner andpotential ally of China vis-a-vis the United States, Putin may have forfeited the option of the "Chinacard" that Primakov had worked so hard to create. This too would seem a very high price for Putinto pay for some short-term tactical objective. This is not to say that Russia's new western orientation is permanent and unchangeable. The economic revival that Putin seeks through integration with the West could eventually strengthenRussia to the point that it is able revert to previous patterns of antipathy toward the West. On theother hand, the economic revival that Putin seeks, and other changes in Russia and in theinternational environment, might transform Russia and its perception of its place in the world suchas to anchor it in the West. In any case, Putin seems to acknowledge that for the near- andmedium-term future, cooperation with the West is a necessity. In its first year-and-a-half, the Bush Administration, with missile defense as a high priority, tooka harder line toward Russia than its immediate predecessors. Before September 11, theAdministration saw Russia on most issues as "part of the problem." After September 11 and the waron terrorism, the Administration has tended to see Russia generally as "part of the solution." Some would argue that this generalization is too glib and glosses over the fact that reportedly there are significant splits within the Administration on Russia policy. The conventional wisdomholds that Vice President Cheney and Defense Secretary Rumsfeld take a harder, less conciliatoryline toward Moscow. Secretary of State Powell is reportedly more willing to compromise. NationalSecurity Advisor Rice's position is less clear-cut, but reportedly more often leans toward Cheney andRumsfeld. (45) Secretary Powell has been knownto quip that he sometimes has an easier timediscussing U.S.-Russian relations with Foreign Minister Ivanov than with Defense SecretaryRumsfeld. Putin's willingness to acquiesce on many issues - even some that Moscow had long heldto be core interests that it would defend tenaciously - is seen by some as validating the lessconciliatory approach reportedly favored by the Vice President and Defense Secretary. The Bush Administration made the most of Russian cooperation in Afghanistan. Pentagon spokesmen praised Russia's contributions, but it is primarily a U.S. operation, the outcome of whichmay serve Russia's security needs as much as America's. Other aspects of America's war againstterrorism are less pleasing to Moscow. Some Russian officials have publicly fretted over the duration of the U.S. military presence in Central Asia. The Central Asian governments, however, appear to view longer term U.S. militarypresence as powerful assistance in their struggles against radical Islam and also as a healthycounterweight to the previously predominant influence of Russia and China. Russians who are waryof China's ambitions in the region may also welcome the United States as a helpful counterweight. (46) Many Russians criticized the Georgia Train and Equip Program (GTEP), announced by the Bush Administration in March 2002, of sending a U.S. military contingent to Georgia to assessGeorgian military, security, and border forces to help them combat Chechen, Arab, Afghani,al-Qaeda, and other terrorists who allegedly have infiltrated Georgia. (47) In view of the tensionbetween Moscow and Tbilisi over alleged Russian support for the Abkhazian separatist movementin Georgia, and Russia's continued occupation of military bases in Georgia against the wishes ofthe Georgian government, and Russian claims that Georgia is harboring Chechen terrorists, someRussians have expressed concern that U.S. training and equipment might be turned against Russianinterests. Some Russians also worry that the small (150 men) U.S. military contingent in Georgiamight grow and become more permanent. U.S. officials reply that GTEP is a temporary missionwhich also serves Russian interests, in that it will enhance Georgia's ability to deal with securitythreats arising from the presence of Chechen refugees and fighters in the Pankisi Gorge area ofGeorgia, adjacent to Chechnya. (48) After September 11, the Bush Administration substantially reduced, although it did not entirely stop, its criticism of Russian human rights abuses in Chechnya. The Bush Administration pushed ahead with plans for NATO enlargement, likely to include the former Soviet republics of Estonia, Latvia, and Lithuania. At the same time, the Administrationreached out to Moscow, agreeing to a new NATO-Russia Council in which Moscow will have anequal voice, and vote, on certain issues (see below, p. 24-25), but not on core Alliance collectivesecurity issues or on admitting new members. After the inconclusive November 2001 Washington/Crawford, Texas summit, the Bush Administration went ahead with withdrawal from the ABM Treaty and stuck to its guns on strategicnuclear force reductions, eventually yielding only on designating the resulting agreement aninternational treaty, subject to legislative approval, as the Russians - and the U.S. Senate - haddemanded. (49) Between the two summit meetings,news of the Bush Administration's Nuclear PostureReview ruffled Russian feathers. The new NPR continued to list Russia as a potentially hostile stateagainst which nuclear contingencies might have to be planned, despite U.S. claims that it no longersees a Russian "threat" as the basis for sizing and structuring U.S. nuclear forces. (50) The Bush Administration has been more forthcoming in addressing what Putin says is his top priority, Russian economic interests. On June 4, 2002, the U.S. Department of Commerce madegood on a pledge the President made the previous year, officially certifying Russia as a "marketeconomy." This will facilitate bilateral trade, ease the burden that Russian exporters face inanti-dumping and countervailing duty procedures, and bring Russia a step closer to WTOmembership. The Russian government hailed this as an important step. Some critics of BushAdministration policy toward Russia fault the length of time the Commerce Department took to act,arguing that certification should have been completed before the November 2001 Bush-Putinsummit, and certainly before the May 2002 summit. But certification came two weeks after the Maysummit. This could be interpreted as an insult, a sign that Russia's most urgent interests are not sourgent in Washington. On the other hand, others could argue that the deliberate pace of CommerceDepartment action was a positive sign that Russia was finally being treated like a "normal country,"the issue handled in a businesslike way, decided on its merits because real commercial issues wereat stake, not pushed through as a political case requiring special handling. Moscow complains about still being subject to the "freedom-of-emigration " requirements ofthe Jackson-Vanik amendment (Title IV of the Trade Act of 1974), which is linked to grantingRussia "permanent normal trade relations" (PNTR) status. At their November 2001 summitmeeting, Bush promised Putin that he would work with the Congress to grant Russia PNTR status.Two bills have been introduced in the 107th Congress ( H.R. 3553 and S. 1861 ) to grant PNTR status to Russia. Some critics of U.S. policy toward Russia argue that the BushAdministration has not made the lifting of the Jackson-Vanik amendment's application to Russia ahigh enough priority. (51) In the past year, President Bush has repeatedly stated his wish to see U.S. trade with and investment in Russia increase. Many Russian officials are disappointed with the level of U.S. tradeand investment. (52) Having grown up in acommand-economy environment, many Russians may notfully appreciate that trade and investment flows are mainly responsive to market forces rather thanto political pronouncements. Under Putin's leadership, the Russian government has madeadministrative changes and the legislature has enacted laws aimed at creating a more market-friendlyclimate for trade and investment. Most western specialists agree, however, that although a good starthas been made, the task is far from complete and that foreign business interests want to see moreimplementation of market reforms, especially in such areas as contract enforcement, protection ofshareholders' rights, reform of the banking sector, and clarification of tax authority among federal,regional, and local governing structures. (53) The shift in Russian national security policy and the Bush Administration's responses to thatshift have important implications for future relations between two nations. Below is a briefdiscussion of possible effects of the new dynamic in U.S.-Russian relations on selected issues, withan eye toward issues of congressional interest and congressional means of exercising influence onthose issues. In the decade of the 1990s, U.S.-Russian relations lurched from declarations of the end of the Cold War, to pledges of "strategic partnership" and "alliance," to disillusionment, recrimination, andneo-Cold War antagonism. The new leadership in both Washington and Moscow seem intent onavoiding such dramatic swings. At the Bush-Putin summit in May 2002, the two leaders issued aJoint Declaration on the New Strategic Relationship, couched in relatively realistic terms, listingspecific, concrete areas of planned cooperation and identifying issues on which their interestsdiverged. The two pledged that their countries would, "...continue an intensive dialogue on pressinginternational and regional problems," noting candidly that, "Where we have differences, we willwork to resolve them in a spirit of mutual respect." To help keep bilateral relations on an even keel,Bush and Putin established the Consultative Group for Strategic Security, which includes the U.S.and Russian foreign and defense ministers. Implicit in the Presidents' Joint Declaration, and in theStrategic Offensive Reductions Treaty signed the same day, is Russia's recognition of current U.S.geostrategic dominance. This statement in the Joint Declaration, affirmed by both leaders butreflecting Putin's priorities, is the key: "...[T]he security, prosperity, and future hopes of our peoplesrest on a benign security environment, the advancement of political and economic freedoms, andinternational cooperation." (54) An importantelement of U.S.-Russian economic partnership iscooperation in key sectors such as energy and finance and in improving Russian corporategovernance. Russia could gain a great deal from an economic partnership with the United States. The United States is the world's largest market, generates the most investment capital, and has aleading role in the policies of international financial and economic institutions such as the IMF,World Bank, EBRD, OECD, and WTO. (55) If Putin continues to believe that Russia's economic recovery and future prosperity require "a benign security environment"and economic cooperation with the United States, Russia may be agood deal more cooperative on security issues in the next few years than in 1996-2000. SomeRussian foreign policy specialists suggest that the United States should come to regard Russia inmuch the same way it regards France: as an important country, an ally with shared strategic interests,but a "thorny ally" with which it also has significant policy differences. As noted above, Putin began promoting the idea of U.S.-Russian cooperation against terrorism well before September 11. This remains a key element in both countries' security agendas, althoughwith the Taliban regime gone, their emphases and priorities differ somewhat. Both countriesexcoriate Al Qaeda and like-minded radical Islamic movements. Cooperation in Central Asia maycontinue on that basis as long as Russia does not feel threatened by the U.S. presence there. At theirMay 2002 summit, Presidents Bush and Putin announced that the U.S.-Russia Working Group onAfghanistan would be given a broader mandate and renamed the U.S.-Russia Working Group onCounter terrorism, which would, among other issues, address the threats posed by nuclear,biological, and chemical terrorism. But whereas Moscow characterizes Chechen rebels almostexclusively as terrorists, Washington has doubts about the accuracy of that picture. Similarly, theBush Administration's denunciation of Yasser Arafat's leadership as irremediably tainted by its linksto terrorism, is not shared by Moscow, among others - although the Russian government flatlycondemns Palestinian suicide bombings. (56) In the1990s, Russian support for Iraq was a sore spot inU.S.-Russian relations, particularly during Primakov's stewardship of Russian policy. Some Russianofficials, scholars, and think-tank analysts recently hinted that Moscow might not object too stronglyto U.S. military action against Iraq, provided that: a) Washington does not act unilaterally and, b)Russian economic interests in Iraq are respected. (57) U.S.-Russian activities in the area of preventing WMD proliferation have two distinctly different aspects. The first involves cooperative efforts to safeguard dangerous nuclear, chemical,and biological materials and related weapons technologies inside Russia and other Soviet successorstates. This has been addressed in the past through high-level initiatives such as the Nunn-LugarComprehensive Threat Reduction (CTR) program, in which Congress has taken a leading role. (58) Intoday's atmosphere of U.S.-Russian strategic cooperation, such programs are believed likely tocontinue, and perhaps increase. For example, the Russian Federation Debt Reduction forNonproliferation Act of 2001 ( S. 1803 ), would authorize the President to engage indebt-for-nonproliferation exchanges to reduce the amount of Soviet-era debt owed by Russia to theUnited States. (59) Another example is the so-called"10 plus 10 over 10" plan, backed by the UnitedStates and adopted at the G-8 summit in Canada in June 2002. This plan, if implemented, would addup to $10 billion from the other six (non-U.S.) G-7 countries to the $10 billion pledged by the UnitedStates, over the next ten years, to finance WMD nonproliferation programs in Russia and otherSoviet successor states. The other key aspect of the Russian WMD proliferation issue concerns Russian transfers of nuclear reactors and ballistic missile technology to certain states, particularly Iran. (60) This has beena vexing issue in U.S.-Russian relations since the mid-1990s. The Clinton and Bush Administrationsand the Congress have treated these as very high priority issues, but have had little success inconvincing Russia to halt either its nuclear reactor construction program at Bushehr, Iran, or thecovert transfers of missile technology from Russian institutes and enterprises to Iran. (61) Moscowargues that the Bushehr reactor project is legal, proper, and safe. Washington replies that while theprogram may be legal - in that it violates no treaties or international obligations to which Russia isa party - it will be used by Iran to advance a clandestine nuclear weapons program which will be agrave security threat to the United States, its allies and friends, and to Russia as well. (62) The question of missile technology transfer is less clear cut. Different Russian authorities have claimed at various times that: a) there were no such transfers; b) there were some unauthorizedtransfers, but they have been stopped; c) the transfers were/are being done illegally by shadowyentities that elude Russia's best efforts at export control; d) the alleged illicit transfers are oflegitimate dual-use technology not covered by the Missile Technology Control Regime (MTCR). (63) One of the results of recent Bush-Putin summitry was a decision to address questions of Russian nuclear reactor and missile technology transfers to Iran more systematically. A standing bilateralworking-level group was established for this purpose. There had been some speculation that anunderstanding might be reached in which Russia would complete the single Bushehr reactor, withenhanced safeguards, but would provide no additional nuclear cooperation to Iran. In late July,however, the Russian press reported that the Ministry of Atomic Energy (MINATOM) had adopteda plan to build five new nuclear reactors in Iran over a ten-year period, three more at Bushehr andtwo at another site. According to a senior Bush administration official, "... the White House wasinfuriated by that and extremely surprised.... What we were told was: It's a draft and it's not done." A high-level U.S. delegation made a previously planned visit to Moscow to urge Russia to cancelthis deal. Recent reports quote the head of MINATOM as saying that the ten-year plan was"theoretical" and might be reevaluated in light of "political factors." (64) While the outcome of the Russia-Iran agreement remained unclear, reports of new Russian ties with Iraq and North Korea drew attention. On August 16, 2002, Iraq's Ambassador in Moscowannounced that the two countries would soon sign an economic cooperation agreement worth $40billion. A senior Russian official confirmed that a five-year agreement with Iraq, encompassing theoil, electrical, chemical, agricultural, and transport sectors, under consideration for several years, hasbeen approved by the relevant ministries and is being readied for signing. He also said the contractswould not violate U.N. sanctions against Iraq. The official U.S. response downplayed the reporteddeal. A White House spokesman said that Putin remained a strong supporter of the war againstterrorism and that Washington expected Moscow to continue honoring the sanctions regime againstIraq. (65) Also in mid-August, Moscow announcedthat North Korean leader Kim Jong-il would soonvisit the Russian Far East. Putin is expected to meet with him there. Continued Russian nuclear reactor and missile technology transfers to Iran could become a critical test of Putin's policy of cooperation with the United States. On the one hand, Moscow seesTeheran as a stable, friendly regional power and a vitally important market for its cash-strappednuclear power and defense industries. On the other hand, the United States sees Iran as a leadingstate sponsor of international terrorism and is absolutely committed to trying to prevent Iran fromacquiring nuclear weapons and long-range missiles. Some observers question whether Putin's claimof being America's chief ally in the fight against terrorism can be considered credible in the face ofcontinued - and expanded - Russian nuclear cooperation with Iran. Congressional support for theRussian Debt for Nonproliferation Act ( S. 1803 ), inter alia , might be adversely affectedby such a Russian policy. (66) It may be that the Russian reactor construction program in Iran was drafted by enthusiasts at the Ministry of Atomic Energy or elsewhere, without prior Kremlin approval, and that it will ultimatelybe buried. Alternatively, the ten-year, five-reactor plan might be a negotiating ploy aimed at gettingWashington to agree to a more limited expansion of Russian nuclear cooperation with Iran. A morecynical interpretation might be that the reported plan is a ruse, meant to be floated and thenwithdrawn as a "concession," to ease U.S. pressure on the original Bushehr project. Similarly, the Russia-Iraq economic cooperation agreement can be interpreted in different ways. Baghdad is eager to muster as much international support as possible in the face of a possible U.S.military attack, and may have offered Moscow an especially rich plum in order to bolster Russia'ssupport. Moscow may have been motivated primarily by financial gain. On the other hand, Russia'sdeal with Iraq, together with the Iranian reactor plan and the invitation to Kim Jong-il -encompassing all three elements of Bush's "axis of evil" - may be a signal that Moscow isdispleased with current U.S. policy. During the Cold War, arms control often dominated the U.S.-Soviet agenda. Moscow has sought to maintain that arrangement, which inherently treats the two parties as equals and providesopportunities for Moscow to try to restrain Washington from further tilting the military balance inAmerica's favor. The Bush Administration takes the position that the Cold War is over and thatfriendly states do not need arms control treaties to protect them from one another. Some in theAdministration and Congress also maintain that Russia is too weak economically, politically, andmilitarily to prevent the United States from acting unilaterally in its best interests on vital questionsof nuclear forces and missile defense. Many others, critical of the unilateral approach, argue thatRussia remains a nuclear superpower and that U.S. security and nonproliferation are best served bymaintaining the arms control process with Russia. There is general agreement that in the Strategic Offensive Reductions Treaty, Moscow acceded to the U.S. position on virtually every substantive issue. (67) Most observers think that the Treaty willwin approval easily in the Senate. It is also widely believed that Putin's political power and prestigeensure parliamentary approval of the Treaty in Moscow. Both sides officially agree (Russiareluctantly) that the ABM Treaty and the (unratified 1993) START II Treaty are both dead letters. That leaves missile defense as the principal item remaining from the old strategic arms controlagenda. Russia still seeks to slow or shape U.S. missile defense activities as much as possible, arguing that missile defense will be destabilizing bilaterally and globally, and will accelerate nuclearweapons proliferation among non-weapon states. (68) Russian authorities appear to understand,however, that acting alone, they lack the leverage to prevent the Bush Administration from goingforward as rapidly as possible with missile defense, a strategic initiative to which it is deeplycommitted. Although Washington and Moscow continue to disagree on missile defense, the JointDeclaration at the May 2002 summit suggests that Washington has the upper hand. In it the UnitedStates and Russia: ... acknowledge that today's security environment is fundamentally different than during the Cold War. ... agreed to implement a number of steps aimed at strengthening confidence and increasingtransparency in the area of missile defense, including the exchange of information, ... reciprocalvisits to observe missile defense tests, and observation aimed at familiarization with missile defensesystems.... ... agreed to study possible areas for missile defense cooperation, including the expansion ofjoint exercises... and the exploration of ... programs for joint research and development of missiledefense technologies.... ... will, within the framework of the NATO-Russia Council, explore opportunities forintensified practical cooperation on missile defense for Europe. (69) It would seem that Russia's main hopes for altering or slowing U.S. missile plans defense lie outside the realm of bilateral relations. Moscow will probably continue trying to rally internationalopposition to missile defense, including opposition from U.S. allies in Europe and Asia. Congress,through the budget process and other means, has a critical role in the future of missile defense. Inview of the sharp divisions within the Congress over missile defense in general and the BushAdministration approach in particular, this is bound to remain a contentious issue. Russia, having given up trying to block NATO enlargement, including accession of former Soviet republics Estonia, Latvia, and Lithuania, has removed some of the drama from the issue. Under these circumstances, NATO states, and Congress, can consider which candidates to invite tojoin the Alliance on the basis of their merits, without being overly concerned about possible negativeresponses from or repercussions with Russia. The creation of the NATO-Russia Council in May 2002 opens a new chapter in relations between Russia and the Alliance formed 53 years earlier to resist Soviet encroachments in Europe. The new Council, which will bring Russia together with the 19 (at present) Alliance members todiscuss security issues, is similar in many respects to its predecessor, the NATO-Russia PermanentJoint Council (PJC), created in May 1997. The new Council, however, is both more ambitious andmore limited than its predecessor in important ways. It is more ambitious in that it will give Russiaan equal voice and an equal vote in its deliberations and decisions. It is more limited in that the PJCset out to address a very broad but vaguely defined range of issues, global in scope, numberingfifty-six in all. The new Council begins with a more narrowly and clearly defined work plan: counterterrorism, nonproliferation, arms control and confidence-building measures, theater missile defense,peace keeping and crisis management, search and rescue at sea, civil emergency preparedness, andmilitary-to-military cooperation and military reform. (70) In the old PJC, characterized initially as 19+1, the Russian representative took an antagonistic, obstructionist position. In response, Alliance members adopted the practice of arriving at a commonNATO policy before a PJC meeting and presenting Russia with a fait accompli , which Moscowderisively characterized as 19 vs.1. (71) The newCouncil, characterized as NATO-at-20, begins witha higher level of trust on both sides, but also with built-in safeguards. The Council will operate onthe basis of consensus, but if it fails to reach consensus on an issue, that issue can be withdrawn andreferred to the North Atlantic Council, NATO's main decision-making body. Also, any memberstate can request that an issue be withdrawn from the NATO-Russia Council. It remains to be seenwhat kind of role Russia will play in the new NATO-at-20 Council. Optimists hope that Russia willbehave like an ally, if at times a "thorny ally." Skeptics worry that Russia will try to use the newCouncil to weaken and divide the Alliance. Some critics also worry that certain Alliance members,particularly small states near Russia, may feel intimidated by Russia's presence in the Council andmight not speak or act as they would otherwise. In an indication of increased congressional interest in NATO, Senators Daschle and Lott reestablished a bipartisan Senate NATO Observer Group (SNOG) of Senators that will monitordevelopments in NATO in light of the new relationship with Russia and the run up to the Praguesummit (November 2002), when invitations to join NATO will be extended to candidate members. Adding new members to the Alliance, of course, would require Senate approval. The high priority that Putin gives to domestic economic development, and the linkage between that and his reorientation of Russian national security policy, increase the importance of economicissues in U.S.-Russian relations. During the Cold War, bilateral economic relations usually weresubordinated to political considerations by both sides. That attitude still lingers in both countries. Bilateral trade and U.S. investment in Russia to date have been minuscule by global standards. Afunctioning market economy in Russia, however, could provide a major market for U.S. goods,services, and investments. Such a development could be mutually profitable and further anchorRussia in the capitalist West. (72) Putin and Bush both say they want the relationship between their two countries to be more "businesslike." The U.S. Commerce Department's certification of Russia as a market economy isa step in that direction. As Congress and the Administration consider another step in that direction- "graduating" Russia from Jackson-Vanik amendment restrictions - several trade issues mayreceive prominent attention. Chief among these are steel, chicken, and oil. A trade dispute over Russian steel exports to the United States arose in the late 1990s as U.S. steel imports surged. Analysts attributed the sudden growth in steel imports to a rapid increase inU.S. demand, insufficient domestic capacity, and the appreciation of the dollar. The U.S. steelindustry filed a number of anti-dumping complaints with the Department of Commerce and the U.S.International Trade Commission against foreign steel exporters, including Russian steel, claimingthat the steel was being sold in the United States at less than fair value. In lieu of completing theCommerce and ITC antidumping investigations, Russia agreed in 1999 to two pacts that imposequotas and set minimum prices on Russian steel exports to the United States. Russian steel exportersand political leaders were not pleased with this outcome, but could have faced costlier restrictionsif the antidumping investigations had run their course and high dumping tariff margins were imposedon Russian steel. (73) On March 5, 2002, the BushAdministration imposed tariffs on steel imports,including Russian steel, to protect domestic producers. U.S. policy on steel remains a source ofaggravation with Moscow, among others. At about the same time that the Bush Administration imposed steel tariffs, a dispute arose over U.S. poultry exports to Russia. Poultry is the largest single U.S. export product to Russia. Russiais the largest single foreign market for U.S. poultry exports. (74) Russia's domestic poultry industrysuffered in the 1990s as the overvalued ruble made imports highly competitive and U.S. imports wona large market share. On March 1, 2002, the Russian Veterinary Service suspended the issue oflicenses for imports of poultry from the United States, citing health concerns over bacterialcontamination and growth hormones. A complete ban was imposed on March 10. Many in theUnited States saw this as retaliation for the U.S. steel tariff. (75) High-level U.S. remonstration resultedin Russian authorities announcing an end to the import ban on April 15; but that did not end theproblem. The Russian Veterinary Service allowed the resumption of some U.S. poultry shipments,but continued to block most imports, pending agreement on a new, more stringent veterinarycertificate. Negotiations over the new certificate dragged on for months while most U.S. poultryremained shut out of the Russian market. On July 24, U.S. trade officials said that they were closeto agreement with their Russian counterparts on a new certificate that would again allow U.S. poultryto enter Russia. (76) The third major trade issue, oil, highlights the potential for cooperation rather than friction. Russia currently is the world's second largest oil producer and exporter, behind Saudi Arabia, whichleads in both categories. Russia's proven oil reserves are twice as large as those of the United States. Although Russia's reserves are much smaller than Saudi Arabia's, its production has beencomparable to Saudi Arabia's. According to a prominent recent assessment, Russia is now engagedin a contest with Saudi Arabia for dominance in the world energy market. (77) As the global economyslowed in 2001-2002, Saudi Arabia and its OPEC partners cut their oil production to shore up prices. In both 2000 and 2001, Russia increased its oil output. (78) Russia's political and corporate leadersare portraying Russian oil companies as reliable sources of supply, willing and able to add outputto the market to keep prices reasonable and thus help revive the global economy. This has economicas well as political significance. Economically, it helps Russia integrate itself into the industrializedWest. Politically, Russia's energy policy increases its leverage in its prospective partnership withthe United States. (79) Russia is not expected to replace Saudi Arabia as the oil price setter - as Saudi Arabia replaced Texas decades ago. What Russian export policy might do, however, is increase competition, keepingoil prices at stable, moderate levels. This would help avoid inflationary pressure in the United Statesand other developed countries. On August 6, 2002, OPEC Secretary-General Alvaro Calderonarrived in Moscow to discuss disagreements over the volume of Russia's oil exports and targetprices. Calderon told journalists that while OPEC believes that oil should cost $22-$28 a barrel,Russia prefers a lower range of $20-$25. (80) At the Bush-Putin summit in May 2002, the two leaders emphasized the importance of Russia's role as a reliable oil supplier in partnership with the United States. Their Joint Statement on the NewU.S.-Russian Energy Dialogue pledged bilateral cooperation aimed at reducing volatility andenhancing predictability of global energy markets and supplies. They foresaw enhanced interactionbetween U.S. and Russian energy companies in exploration, production, refining, transportation, andmarketing. In the Joint Declaration, Bush pledged to encourage U.S. investment to further developand modernize Russia's fuel energy and sector and expand its oil and gas production. (81) He alsopledged cooperation with Russia's energy transportation infrastructure. In August 1999, the Paris Club of official government creditors (of which the United States is an influential member), provided a "framework agreement" reducing Russian interest payments onits Soviet-era debt (of over $50 billion) and deferring payment of principal until after 2001. InFebruary 2000, Russia reached an agreement with the London Club of commercial creditors, writingoff 36.5% of Russia's $32.8 billion Soviet-era commercial debt outright, with the remainder to beconverted into 30-year eurobonds with lower interest rates and an 8-year grace period. This amountsto a total of 52% debt forgiveness in current net value terms. "Comprehensive" Paris Clubnegotiations have begun, to determine whether western government creditors will grant Russia morelarge-scale debt forgiveness, or offer debt rescheduling without forgiveness. Germany, which holds48% of that debt, is calling for full repayment. Some of Moscow's critics contend that Russia'srecent economic upturn and its substantial increases in defense spending should be taken intoaccount by western governments considering further debt forgiveness for Russia. The United States holds about 5% of Russia's Paris Club debt, about $3 billion. Some Members of Congress have expressed interest in helping Russia reduce its Paris club debt as a way ofaccelerating economic recovery, or for more targeted aims, such as funneling more money intoRussian nonproliferation activities. In December 2001, the Senate unanimously passed the RussianFederation Debt Reduction for Nonproliferation Act of 2001 ( S. 1803 ), sponsored bySen. Biden, and sent it to the House, where it is being considered as part of the State Departmentauthorization bill ( H.R. 1646 ). This bill would link U.S. debt forgiveness for Russiato Russian efforts in WMD nonproliferation. The Bush Administration is believed to have beenleaning toward supporting Russia's quest for debt forgiveness. The House International RelationsCommittee held hearings on this bill July 25, 2002. Political support for this idea, however, mightbe adversely affected by Russia's reported plan to build more nuclear reactors in Iran. As noted above, implicit in Putin's strategic decision to seek integration of Russia with the West is a rejection of the Primakov vision of a Russian-Chinese axis of cooperation against theUnited States as the core of Russia's national security strategy. Beijing and Moscow continue toproclaim good will and harmonious relations between them. Indeed, both countries want and needcalm, friendly, stable bilateral relations. And the Cold War-era, triangular, zero-sum game ofU.S.-Soviet-Chinese relations no longer holds sway. Nevertheless, Putin's turn toward the West does have significant implications for Russian-Chinese and U.S.-Chinese relations. There is stillsome triangularity in these relationships. Putin's western orientation works to the advantage of theUnited States vis-a-vis China by reducing Russian support for China vis-a-vis the United States. An analysis carried by Reuters after the May 2002 Bush-Putin and NATO-Russia summits, entitled, "Russia Ends Cold War with NATO, China Shivers," calls attention to Chinese concernsthat Russia's geostrategic shift could bring U.S.-led forces right up to China's western borders. "Itis probably something that is very ... worrying," said one western diplomat in Beijing, "because thereis a risk of isolation of China." (82) If Russia turnedtoward strategic cooperation with the UnitedStates while the antagonism in U.S.-Chinese relations remained, that could leave Beijing in theposition of being, or appearing to be, the leading anti-American power. That could be a costly andrisky position for China, at a time when it is still struggling to accelerate and complete its economicmodernization. The antagonism in U.S.-Chinese relations noted above (p. 11), however, has not remained unchanged. In the past year there has been a warming, or at least an easing of tension, between thetwo. At the outset, the new Bush Administration promised a tougher approach to China than eitherthe Clinton or the earlier Bush Administration, describing China as a "strategic competitor" of theUnited States. In the aftermath of the collision ( April 1, 2001) of U.S. and Chinese military aircraftnear Hainan Island, the antagonism on both sides deepened. After this rocky start, however, theevents of September 11 appeared to alter the policies in both Washington and Beijing. The BushAdministration appeared to see the potential for Sino-U.S. cooperation against global terrorism asa priority, and U.S. officials down-played differences and problems in the relationship as they soughtChinese support with Asian states and in U.N. initiatives. For their part, after September 11 Chineseleaders have taken steps to improve Sino-U.S. relations, soften U.S. criticism of their policies, anddemonstrate that China can be a responsible global player. (83) The apparent softening of Chinese policy (or rhetoric) toward the United States is probably driven by many factors. One of these is likely to be domestic political struggle in the run up to the16th Communist Party Congress (Fall 2002), at which key leadership changes are expected, includingthe succession to President Jiang Zemin. Many analysts have described part of the internal politicaldynamic as a conflict between proponents and opponents of western-style economic reforms. Relations with the United States gets caught up in this because those who favor moremarket-oriented reform of the economy also tend to favor closer economic and political cooperationwith the advanced industrial democracies, including the United States. Many opponents of furthermarket reform also oppose more opening to the West. Thus, disagreement and political conflict overforeign policy among Chinese political elites can become a subset of - and sometimes even asurrogate for - struggle over fundamental domestic issues. It is also possible that concern grew among Chinese leaders in 2001, after the crisis surrounding the April 1 collision of the U.S. EP-3 aircraft and the Chinese jet fighter, and especially afterSeptember 11, that relations with the United States were deteriorating to a dangerous level. Witha new and unpredictable Administration in Washington that seemed inherently unfriendly to China,Beijing may have decided independently to ease some of the tension as a precautionary measure,regardless of Russian policy. At some point in 2001, Putin's policy shift toward the West probably entered into Chinese calculations and debates about relations with the United States. Those in the Chinese leadership whoopposed the hard-line confrontational approach to the United States could use the Russian shift asan argument against a dangerous Chinese course that risked conflict with America, without theprospect of Russian support. Those in Beijing who advocated a tougher line toward Washingtonmust have been encouraged by Primakov's policy of partnership with China against the globalhegemon - and discomfited by Putin's abandonment of that policy. In the internal Chinese debateover policy toward the United States, Putin's westward tilt may not have been the most importantconsideration. But it most likely was one of the factors that shaped, and is shaping, Chinese policy. Thus, it seems likely that Russia's turn toward the West influenced China to move in the samedirection - although not to the same degree nor for the same reasons. There is an active debate about the appropriate U.S. response to Putin's policy of integrating Russia with the West. American, European, and Russian critics of Bush Administration policytoward Russia make many of the same arguments. The essence of their criticism is that the UnitedStates should do more to reciprocate Putin's cooperativeness and ensure that Russia stays on thiscourse. Some argue that Putin's shift toward the West lacks strong domestic political support and therefore is fragile. Some compare Putin to Gorbachev, warning that Putin's pro-western policycould meet a similar fate - arousing domestic opposition like that which led to the August 1991 coupthat almost toppled, and fatally undermined, Gorbachev's leadership. Others, who see Putin'spolitical position as relatively secure, warn that Putin himself might conclude that his cooperationwith the United States is not yielding the desired reciprocity from Washington, leading him to moveaway from a "failed" policy. Another line of criticism is based on a longer-term view. I.e., Russia'scurrent weakness may be such that it has no choice but to accede to heavy-handed U.S. dominance- however, Russia is likely to recover and once again be a great power, and when it does, it willharbor resentment and animosity toward the United States because of arrogant and short-sighted U.S.policies that ignored Russian vital interests and offended Russian national dignity. All three versionsof this criticism cite the same list of U.S. actions that allegedly are offensive to Moscow, such aswithdrawal from the ABM Treaty, missile defense, NATO enlargement, and U.S. militarydeployments in Georgia and Central Asia. On the other hand, many observers believe that the Administration's approach to Russia is fundamentally sound. Some supporters of Administration policy argue that Russia simply does notmatter very much any more - that with a population smaller than Brazil, a GDP smaller than theNetherlands, and armed forces that have little ability to project power beyond its borders, Russiashould not be treated deferentially, as a great power, by the United States. Some who hold this vieware dismissive of Russia - whether Russia succeeds in becoming a modern state with a functioningmarket economy is their business, not ours. Others view the relationship in terms of "tough love,"helping Russia adjust to its proper status as a regional, rather than a global, power. Still others,focused on the Cold War rivalry, are happy to see Russia as a weak, defeated foe and want to keepit that way. Some supporters of U.S. policy toward Russia contend that Putin's repeated concessions to U.S. positions and acceptance of faits accomplis , acknowledging U.S. force majeure , confirmthecorrectness of that policy - that there was, and is, no need to make undue concessions to Moscow,because Russia has no choice but to go along with the United States, due to Russia's weaknessvis-a-vis the United States and because of Russia's objective need to join the western world, on theWest's terms. Some of those who oppose being deferential to Moscow say that many of Putin's domestic policies are undemocratic, and that the United States should not hesitate to criticize such tendenciesand press the Kremlin to do better. They argue that U.S. silence in the face of Russian governmentabuses such as restrictions on freedom of the press and religion, control over the formation ofpolitical parties, persecution and imprisonment on false charges of political dissidents, and massivehuman rights violations in Chechnya, are a betrayal of U.S. values and a signal to Russian authoritiesthat the United States is not really serious about democracy in Russia as long as Moscow cooperateson security issues. Those who question the wisdom of Administration policy warn that at some point, if Washington is not more forthcoming to Moscow, Russian policy may swing back in the directionthat Primakov favored, and that this would be a tremendous lost opportunity for the United States. Others reply that to the extent that there is a danger of Putin's pro-western policies being reversed, it will hinge not on whether the United States and the West reward Russia, but on whetherPutin's domestic economic policies succeed. After all, these observers contend, Putin's fundamentalrationale is that Russia must integrate with the West in order to reconstruct its economy and achievea decent living standard for its people. If that goal, or appreciable progress in that direction, is notachieved in a reasonable period of time, the pro-western policy will be difficult to sustain. If this istrue, then the United States has not only a humanitarian interest but also a strong self interest inRussia's economic recovery.

Summary: Russian President Putin appears to have made a strategic decision to shift Russian policy toward cooperation with the United States and the West. This is a major departure from the policy that Putininherited from his predecessors, which saw Russia as the leader of a coalition aimed at opposing U.S."global domination." Putin seized upon the events of September 11 to promote his new policy by: cooperating with the United States against Al Qaeda and the Taliban regime in Afghanistan; softening Russianopposition to NATO enlargement, including admission of former Soviet republics, and establishinga new cooperative relationship with NATO; acquiescing in U.S. decisions regarding withdrawal fromthe ABM Treaty, strategic nuclear force reductions, and missile defense; and closing Russia's largemilitary intelligence base in Cuba. The principal reason given by Putin for the new policy is that Russia must integrate with the West in order to reconstruct its own economy and achieve a decent living standard for its people. Putin also acknowledges Russia's weakness and inability to act globally in opposition to the UnitedStates. He may also have rejected as unwise, the previous policy of de facto alliance with Chinaagainst the United States, instead seeing China as a possible long-term threat to Russia. Putin's new policy does not seem to enjoy strong support among Russian political elites, the military and foreignpolicy establishment, and the general public. Putin's overall political power and prestige, however,may be sufficient to sustain the policy. The Bush Administration responded positively to the new Russian policy after September 11. The Administration, however, did not make many concessions on key issues related to arms control,missile defense, and NATO. It has been more forthcoming on some economic issues. The implications of Russia's pro-western policy are overwhelmingly positive for the United States in the war on terrorism and in relations with Russia and China. Russia's strategic choice ofintegration with the West reduces the danger seen by some of Russo-Chinese cooperation againstthe United States. By depriving China of its erstwhile Russian partner, it may encourage China toseek improved relations with the United States - or risk geostrategic isolation. Some sore points remain between Washington and Moscow in which Congress takes a strong interest, such as Russia's continued and possibly expanded plans to construct nuclear reactors in Iran,its support of Iraq, and its heavy-handed policy in Chechnya. There is also friction on some tradeissues. Critics of Bush Administration policy argue that it has not been sufficiently responsive to Putin and risks losing the new cooperativeness. Others reply that Russia has no choice but to continue itspro-western course, in view of Russia's weakness and its self-interest in integrating with the West. In this view, the endurance of Russia's pro-western policy ultimately may depend on Putin's successin reviving the economy and improving Russians' well-being.