The Curse of a Country with an Inadequate Economy for Its Own Imperialist Ambitions

Adriana Castagnoli
Historian and economist, she is a columnist for “Il Sole 24 Ore”. She investigates geopolitical and economic relations at a global level. She has taught Contemporary and Economic History at the University of Turin. Her most recent publications include Il lungo addio.

History teaches that nations and their leaders rarely learn the lessons they should. In the recent weeks there has been a debate over the alleged “prophecy” of the former Secretary of State Henry Kissinger on Ukraine. But few remember that, in 1994, addressing the nostalgic restorers of the Russian empire, Kissinger stated that they could repeat the fatal mistakes of their Tsarist and Soviet predecessors because “the extension of territory was an extension of weakness”. Even the former U.S. ambassador to Moscow, Jack F. Matlock, observed that the Russian empire could not be reconstituted because only a “healthy economy” could bear the cost.

The gap between imperial ambitions and economic power is the hallmark of Russian history over the last half-century, beginning with the failure of the Soviet-American détente policy inaugurated by the Nixon-Brezhnev summit in Moscow in 1972. Despite a series of long-term economic cooperation agreements (e.g., on nuclear energy, space, environment, nuclear armaments), in the second half of the 1970s the USSR continued the broadening and involvement of its foreign policy with ever more extensive commitments in the Middle East and Africa. 

In Washington they became convinced that the East-West economic cooperation, far from fostering the convergence of the two systems, had favoured the Soviet military build-up through the transfer of Western technology. In December 1979, the Soviets invaded Afghanistan with the purpose of backing the communist government threatened by the Mujahideen. They will stay there for ten years. First the democratic President Jimmy Carter, then his republican successor Ronald Reagan, intensified covert operations and economic sanctions with the goal of making Afghanistan the Vietnam of Moscow. But the USSR, beyond the show of strength, was already on the ropes after years of stagnation.

Western Europe, despite the embargo imposed by Washington, continued its trade with Moscow with some uneasiness, particularly in the energy sector, deepening economic solidarities that would be increasingly difficult to get rid of. In January 1992, one month after the dissolution of the Soviet Union, President George H.W. Bush claimed that the United States had won the Cold War. In Russia the mood was different, although there were those who thought that the new world order could be realized the way Mikhail Gorbachev and the Soviet reformers had imagined: Moscow would contribute to a “common European house”, designing the new international order together with Americans and Europeans.

The economic asymmetry between Washington and Moscow became evident during the global financial crisis of 1998, when Russian politicians complained that the United States had been unable to steer the International Monetary Fund into granting Moscow a financial stabilization package similar to that offered to less politically relevant countries. Substantial differences eventually eroded trust and cooperation between the two powers, as the Kremlin sought higher power status on the international stage. Russia and the United States remained at odds over the NATO enlargement strategy, although they found points of agreement on some aspects, to the extent that they launched the NATO-Russia Permanent Joint Council, and the Partnership for Peace with the aim of establishing joint forces to be deployed in the rapid management of regional conflicts. But Moscow’s intent was to take back, for better or worse, its rightful role as a former great power.

With the rise of Vladimir Putin, who became prime minister in 1999, these asymmetries crystallized Russian and American positions. Moscow’s opposition to NATO’s eastward enlargement stemmed from the perception that the expansion of the Alliance offered the U.S. the possibility of acting unilaterally regardless of Russian objections. Even the EU’s willingness to embrace former Soviet bloc countries was perceived as an attempt to prevaricate Moscow’s prerogatives. President Putin expressed this position clearly in the spring of 2000, by asserting that Russia might revise the idea of applying for NATO membership, but only if NATO had undergone a major transformation and had assumed the character of a political organization, the cornerstone of which would have to be the granting of veto powers to Russia.

The NATO intervention “for humanitarian reasons” in Kosovo in 1999 changed the Russian perception of the international scenario. Underneath the ashes of the former Soviet military apparatus brooded many ill-feelings that generated resentment, and Russian generals continued to think in terms of East-West confrontation. Many events burst onto the international scene: after the intervention in Kosovo, followed Islamic terrorism and the 9/11 attack, Western military operations in Afghanistan, Iraq, Libya; until the great financial crisis of 2008 and the subsequent recession. The collapse of oil and commodity prices turned the Kremlin’s bet on commodities into a risk for the Russian economic system, despite the fact that Washington had supported Russia’s entry into the WTO in August 2012.

Moscow’s response to domestic problems remained its increase in military interventionism abroad: from the war in Georgia, to the one in Ukraine and the one in Syria. Meanwhile, the economic rise of China also constituted a challenge for Moscow in the construction of the wider “Eurasia”, reducing its influence in Central Asia. Russia thus found itself in a sort of identity crisis, to which it responded by resorting to the Soviet model of the fight with the West.

With the intervention in Syria, Moscow had regained a great-power status, also by working side by side with the United States for a diplomatic solution to the crisis and the success of the later truce agreement. But President Putin’s ambitious programme was to transform the Russian army into a light force, equipped with state-of-the-art technology by 2020. Ever since the war with Georgia in 2008, Vladimir Putin had put the introduction of now-insurmountable structural reforms in the Russian economic system on the back burner, focusing instead on re-establishing the prerogatives of the former Soviet regime. He had tried to compensate for the weakness of the Russian economy, on which the effects of the sanctions imposed by the EU for the annexation of Crimea in 2014 also weighed heavily, by resorting to neo-nationalist and revanchist sentiments that stemmed from a widespread discontent with Washington’s global leadership. While investments in digital technology and infrastructure were scarce, the effects of Western sanctions and Russian counter-sanctions on the import of agricultural products had finally oriented the Russian economic system in an autarchic direction.

Against this backdrop, in July 2021 and for the first time since 2015, Putin updated the National Security Strategy: a manifesto for an era defined by an intensifying confrontation with the United States and its allies, accompanied by a return to the traditional Russian values. The gap between imperialist ambitions and economic power has remained dangerously relevant.

* This article was published in Il Sole 24 Ore on April 1, 2022