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To: John Hunt who wrote (17003)	11/4/1998 11:12:00 AM
From: Thomas M.	Respond to of 18056

forbes.com "Both leading candidates for the Russian presidency are inward-looking nationalists. What does this mean for the U.S.?" A New Chill? By Robert Lenzner CONDOLEEZZA RICE, provost of Stanford University, has been mentioned as a possible Secretary of State in a Republican administration. She is an expert on Soviet affairs, and from where she sits, neither the election of Luzhkov nor that of Lebed bode well for Russian-U.S. relations. "We have suffered a huge defeat for U.S. foreign policy," she said in a recent interview with FORBES. "For a brief moment there was a faint hope of a liberal Russia. Now it's a foreign policy opportunity gone dead. "Our relationship has become a contrarian one that's likely to get chillier no matter who wins the election, Luzhkov or Lebed. "Whoever wins will likely have more nationalist-sounding policies. They'll be even less cooperative over policy. It's going to be tough sledding." Rice predicts Russia will lean increasingly toward Arab nations, including Iraq, and will refuse to cooperate in peacekeeping efforts. "They claim to be worried about global stability, but they are not vigilant about nuclear materials and ballistic missile technology," she says, pointing out that Russia is already helping arm Iran. "We're not able to make further progress on the proliferation of weapons of mass destruction. There is more reason to worry about the transfer of nuclear materials." And we can expect trouble in the Balkans from Russia, which, going well back into history, has regarded itself as protector of the Serbs. "We gave Russia too big a voice in NATO in 1996 as the price of allowing expansion of central Europe into NATO," she worries. "If every time the alliance gets together we feel we have to invite Prime Minister Primakov, who lacks any motive to cooperate with the U.S., it will be tough to get anything done. The Russians are recalcitrant on Kosovo." She worries, too, about Russian economic policies. "I don't think they'll do outright nationalization, but they may be desperate to find ways to tax Western investors," says Rice, who serves as a director of Chevron and Transamerica and is a member of J.P. Morgan's international advisory council. "I don't know if they even understand the implications of their default, that it impacts confidence and their reputation across the globe. Russia's default on its government obligations has set back Western investment in Russia by years, probably decades." She thinks Western policy was overly optimistic. "We were mistaken that the IMF program and private capital could transform Russia from a statist to a market economy. Some $50 billion [in international aid] went down a rathole." She sees Russia's global options as quite limited. "Russia is no longer a world power, but wants to be a major player. That gives it limited options: to be a thorn in the side of the U.S. or to cooperate. I think they'll choose the former." What should the U.S. do? Put up with it and wait for a new generation of Russians to take over, who will understand what democracy and economic freedom mean. "I believe there'll be another opening for real reform," she says, "but not under Luzhkov or Lebed."