Letters

National Interest, The, Fall, 2000

Tainted Transactions, continued:

The debate over who bears what blame for what took place in Russia generates very deep passions. This is not surprising given the distortions that have resulted and the unfortunate way Russian reforms have evolved. But such passion frequently leads to intemperate reasoning and unjustified accusations.

In "Tainted Transactions: Harvard, the Chubais Clan and Russia's Ruin" (Spring 2000) and her subsequent rejoinder ("Tainted Transactions: An Exchange", Summer 2000), Janine Wedel falls victim to just such a reaction, especially when it comes to evaluating the role of Jeffrey Sachs. Admittedly, Dr. Sachs makes an easy target. To generate support for his causes, which in 1990 was the Polish reform and then the Russian reforms in late 1991 and 1992, he became an outspoken and ubiquitous advocate of support for these efforts. This brought him praise, sometimes deservedly, when things went well, but also criticism (also sometimes deservedly) when reforms became counterproductive. What Wedel neglects to mention, of course, is that Sachs has made positive contributions in other countries. This includes Poland, where I am told by officials involved at the time that Sachs played a key role in convincing the leadership of Solidarity to support the reforms that were subsequently introduced.

In the meantime, others (call them stealth advisers) who bear real responsibility for the grotesque privatization of state enterprises in Russia have so far escaped almost unnoticed. As a consequence, while Wedel is often right on target in highlighting the serious shortcomings in the reform process and in the way American support was provided, she all too often attributes too much importance to the role of foreign advisers and pinpoints the wrong culprits.

Wedel also has trouble with her logic. While she blames Harvard and the Harvard Institute for International Development (HIID) and especially Sachs for much of the failure of the reforms, she questions whether he was really an official adviser to the Russian government. Well if he wasn't an adviser, does he really deserve the blame? For that matter, is it fair to blame the United States for the reforms' failure? In a recent personal conversation with Yegor Gaidar, who was acting prime minister during much of 1992, he affirmed that while Sachs was an adviser to the minister of finance, Boris Fyodorov, he was not the central architect of the reforms.

Wedel also overdoes it when it comes to Harvard. Because it makes such a juicy scapegoat, she continuously refers to what she calls the Harvard-Chubais transactors. 'While this may be an appropriate description for those from Harvard who worked with Anatoly Chubais in 1992 and 1993 on his privatization program, Sachs was not part of that group.

The Harvard-Chubais team is such a convenient culprit that Wedel continues to attack it for what happened even after May 1997, when HIID suspended its activities in Russia, the U.S. government cut off its funds, and Chubais disavowed any further association with HIID. Undeterred, Wedel writes, ". . . in times of crisis for the Harvard-Chubais nexus--such as the ruble crisis of August 1998 and the Bank of New York money laundering scandals--the transactors and their associates have sought to bolster their colleagues' continued clout and standing in both Russia and the United States." This is simply unfair.

Over the years I have had disagreements with Sachs over his analysis of the transition in Russia and whether or not the United States and the IMF should provide financial aid. But never has Sachs sought to profit personally from such advice, or provide insider information for Harvard, its research centers, its financial management, or for-profit investment firms. Sachs is a big boy and he is not shy about criticizing the ideas of others, but implications that he prescribed knowingly flawed advice, benefited personally, or worked on two sides of the negotiating table are not true and certainly not fair or responsible.

MARSHALL I. GOLDMAN

Wellesley College and Harvard University

Janine Wedel is clearly delighted. After three insignificant publications of the same article, her lies have been published in a respectable journal. It is tempting to take her inaccuracies apart again, but why treat her as a serious scholar? Wedel has accused me of conflicts of interest, but after several slanderous articles she has proven nothing. Her arguments are little but repetition of unsubstantiated allegations with a complete confusion of time. Tellingly, her only new claim is that I did not write that I was an economic adviser to the Russian government at a time when I was not. As if to emphasize that her basis of accusation is gossip, she quotes herself: "[Aslund] was understood by some Russian officials" [my emphasis], which is close to a definition of a rumor. She repeats her allegation that "Aslund seemed to speak on behalf of these governments" [Wedel's emphasis], showing that she pertains to the higher sphere of illusion, where I think we should leave her.