U.S.-Russian Relations after the “Reset”

by Joshua Stanton on April 25, 2013

US Russia Obama PutinThe Obama administration’s “reset” policy towards Russia in 2009 ushered in great optimism about the future of the bilateral relationship, but this has since been met with a sobering dose of reality. Vladimir Putin’s return to the Russian presidency has produced a dramatic deterioration in bilateral relations as he has blamed the United States for meddling in Russia’s domestic affairs, forced Western-funded NGOs to register as “foreign agents,” and expelled USAID and Radio Liberty from the country.

For its part, the Obama administration has grown increasingly frustrated as Russia drags its feet on responding to major international crises in Iran and Syria. Casting a brighter spotlight on Russia’s human-rights record, U.S. policy has transitioned from mere “expressions of concern” to legislative action in the form of the Magnitsky Act, which implements asset freezes and visa bans for Russian officials involved in the 2009 death of Russian lawyer Sergei Magnitsky. U.S. officials are now more vocal in their criticism of Russian foreign policy, at times accusing the Kremlin of trying to “re-Sovietize Eastern and Central Asia.”

Given this tension, how can the U.S. move forward in relations with Russia? In order to engage Moscow more successfully over the next four years, the White House should pursue three strategies for reversing this decline:

1. Move Beyond the “Reset”: While a reexamination of U.S. policy towards Russia is clearly needed, the administration should not allow the perceived failings of the “reset” to thwart policy from moving forward. Rather, the U.S. should continue to pursue basic issues of mutual interest—particularly arms control. The New START Treaty signed in 2010 mandates major reductions in deployed strategic nuclear arsenals by 2018, but the administration should consider both accelerating those cuts and reducing non-strategic nuclear weapons (which are not covered in the treaty).

The White House already seems to be moving in this direction. President Obama signaled a willingness to re-negotiate the terms of the Nunn-Lugar Comprehensive Threat Reduction Program to meet Russian objections, while a recent report by the U.S. Secretary of State’s International Security Advisory Board  recommended an accelerated reduction timetable and considered cutting non-strategic nuclear weapons. Stronger arms control will hinge on overcoming Moscow’s concerns about the range and purpose of a missile defense system under the European Phased Adaptive Approach (EPAA). The Kremlin remains undeterred in its criticism of the system, even as the U.S. moves to cancel the final phase of the EPAA that serves as the main impediment to a missile defense agreement. Nonetheless, collaboration on arms control could provide a building block toward broader cooperation.

2. Understand Today’s Protestors: Despite recent crackdowns on political opponents, the Kremlin will find it increasingly difficult to stifle the voice of Russia’s emerging young, urban middle class, which will grow to nearly forty percent of the population by 2020. Increased wealth, Internet access, and exposure to the West have facilitated the youth’s increasing contempt for the current government, its weak institutions, and its tolerance of corruption. It will be vital for Washington to understand this burgeoning segment of the population and engage Russian civil society as new legislation threatens the survival of the nearly sixty Russian NGOs dependent on funding from USAID. The U.S. should reconsider its decision to quit a working group on civil society that was created under the Bilateral Presidential Commission and the State Department should seek to increase outreach to Russian civil society through the Internet and social media.

3. Pursue a Broad Modernization Agenda with Moscow: Lost in the controversy over the Magnitsky Act was the passage of Permanent Normal Trade Relations (PNTR) with Russia. Coupled with Russia’s WTO accession, U.S. exports to Russia could double by 2015. For Putin, this provides a way to modernize Russia’s economy and diversify its exports. He has already indicated his desire to “add a new quality” to U.S.-Russian economic relations and has given his blessing to an Arctic joint venture between ExxonMobil and Rosneft. However, a Russian investment climate rife with poor business standards, rampant corruption, and government intervention presents major risks to U.S. businesses. Russia’s failure to implement WTO-mandated rules on tariffs and market access is also the focus of two potential U.S.-EU complaints to the WTO. U.S.-Russian relations could find new footing if Washington used an expansion of economic ties to forge a partnership similar in scope to that of the EU’s “Partnership for Modernization” with Moscow. Such a partnership presents the U.S. with an opportunity to reinforce Western business norms and practices in Russia while promoting growth in industries outside the Kremlin’s control. This would push Moscow to abide by a rules-based international system, and to show greater respect for the rule of law. Such an arrangement could also expand and empower Russia’s middle class as the foundations for small- and medium-sized businesses are laid.

The path to better U.S.-Russian relations is fraught with challenges. But a focus on mutual economic and trade interests offers small steps toward a more open Russian political climate and an eventual improvement in relations between Moscow and Washington.

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