Panel, Conference Presentation
Russia Revealed: Where Moscow and Washington Go from Here
Milken InstituteMichael Crowley, Jane Harman, Daniel Russell, Andrew Weiss, Nikolai Zelenski, Laura Satrakian, Ben Weg-Prosser, Michael Bright, Kevin Ciccino, John
- U.S. and Senate committees plan thorough investigations into Russian interference and collusion using subpoena power and staff, though resources are acknowledged as limited compared to the FBI, with an expressed hope for a bipartisan approach.
- U.S.-Russian relations are characterized as "broken," shifting from discussions of collusion to the risk of collision, with sanctions expected to remain in place near-term as a deterrent factor despite creating significant uncertainty for Russian corporate activity.
- Vladimir Putin is anticipated to prioritize political consolidation for his March reelection bid by leveraging narratives of "Russian greatness" rather than economic prosperity, potentially utilizing sanctions to mobilize popular support through external blame.
- Russia continues a pattern of foreign policy interference in Western democratic elections, including France, while maintaining a willingness to use force in Syria and Ukraine to advance its objectives.
- The Russian economy remains extremely dependent on oil, with high prices not currently expected due to supply and demand dynamics, while past attempts to diversify through the military-industrial complex and high-tech markets failed.
- Import substitution strategies are currently being implemented despite a lack of evidence regarding their efficacy, and annual capital flight ranging from $50 to $150 billion indicates low confidence in future economic development.
- Increased tax collection pressure and expanded law enforcement powers are expected to further diminish business confidence and investment, contrasting with the strong growth seen in the decade following the 1998 crisis.
- Economic stagnation has persisted with the economy declining for three consecutive years post-2014, though some projections indicate a recovery phase in 2017 with growth estimated between 1% and 1.5%.
- The Russian government currently prioritizes macroeconomic stability, having achieved a stable ruble, inflation rates down to 4%, and foreign reserves around $400 billion, though a lack of competition due to a large state sector remains a primary economic obstacle.
- Increased productivity is identified as necessary for economic growth, yet such gains have not yet materialized, while consumer behavior shows a population unwilling or unable to spend and only moderately willing to invest.
- The pivot to Asia, specifically regarding China, failed to replace the role of European and North American businesses due to onerous capital terms and a lack of active technology transfer, leaving a gap the West previously filled.
- Long-term U.S. foreign policy strategy emphasizes supporting a strong NATO and identifying cooperative areas with Russia, while officials warn that providing offensive arms to Ukraine risks inviting greater Russian force.
- The current U.S. administration displays perceived dysfunction and incoherence in foreign policy, with high risks of miscalculation that could escalate into a new phase of crisis or conflict, potentially involving World War III.
- Trust between U.S. and Russian career national security establishments is absent, characterized by mutual hostility and a lack of cooperation, while the administration faces criticism for over-reliance on flattery and "magical thinking" regarding Russia's role against ISIL.
- Strategic mistakes in Syria and the Middle East, including the inability to force Russia or Iran to alter behavior without direct U.S. ground involvement, have created a volatile situation with a high probability of "near misses" leading to catastrophe.
- Succession planning in Russia presents a risk that a post-Putin leader would be less favorable than Putin, and the lack of a new equilibrium suggests current U.S. foreign policy incoherence may persist until a new stability is reached.