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Restart for U.S.-Russian Relations?

Prof. Peter Morici - 7/27/2009

This week, President Obama is putting into action a new foreign and security policy toward Russia--one based on a realistic expression of U.S. goals and interests and a realistic assessment of Russia's interests, even if Prime Minister Vladimir Putin does not recognize all of them.

Putin still calls the shots, and this represents an important caution to U.S. and other western investors. The fact that Obama must confer with Putin and not just Russian Dmitry Medvedev also indicates the same for U.S. foreign policy.

A year ago, Russian tanks were rolling through Georgia, and Russia was flexing its economic and military muscles, strong-arming western businesses. The price of oil was at its peak--nearly double today's price.

Russia's hubris and menace seems to rise and fall with the price of oil and other resources. No secret to why--all the Russians seem to know is resource extraction, metal refining, war making and gangster rules for investors. It has few other advanced industries to support a continental, modern industrial and post-industrial economy.

I have told my MBA students in our second year international management course, if you invest in Russia, please don’t tell anyone you got your diploma from me.

Hopefully, President' Obama's restart for U.S.-Russian relations does not reject the lessons of the Clinton and Bush eras. It should be based on clear-eyed assessment of Russian history and security requirements--real and imagined. Hopefully, it will not leave the United States stripped of its economic and security defenses.

It’s great to have bilateral reductions in nuclear-armed missiles but how does that relate to a world where nuclear-armed missiles are likely to proliferate among lesser powers, often with Russian and Chinese technology?