BOOK REVIEW / A dinosaur and a chudo: Russia 2010 - and What it Means for the World - Daniel Yergin and Thane Gustafson: Nicholas Brealey, pounds 12.99: Mary Dejevsky applauds an unorthodox, optimistic reading of Russia's likely future

DANIEL Yergin and Thane Gustafson are brave men indeed. They have ventured not only to ask one of the most important and intractable questions of the Nineties, but also to answer it. The question is 'whither post-Communist Russia'. And their answer is structured as four separate scenarios, the last and most optimistic of which - the Russian economic 'miracle', or chudo - could, they suggest, be the one to bet on.

A year ago, when their book, Russia 2010 - and What it Means for the World (Nicholas Brealey, pounds 12.99), was being written, the view that Russia had any sort of a future, let alone a hopeful one, would have seemed even braver than it does now. Then, the Russian president and his parliament were at loggerheads, the legislative process was at a standstill, and social tension was high. The danger of outright war, which erupted briefly in the shooting and bombing in Moscow last October, seemed real.

Even now, after nearly a year of sometimes uneasy peace and a measure of economic stability, the idea that Russia may not be a basket case is hardly conventional wisdom. The dominant view of Russia in Western academic circles is pessimistic: if Russia is not destined for civil war, it is doomed to penury or Fascism.

The continued prevalence of this gloomy view is what makes this book so brave: it is swimming against a very powerful tide. If its authors' credentials were not so sound - Yergin is president of a leading US think-tank, and Gustafson a respected scholar of the Soviet period and professor at Georgetown University - they would have been dismissed as innocents. As it is, they and their arguments deserve to be heard - before Western leaders wake up to find a serious Russian economic power and start complaining that nobody warned them.

Yergin and Gustafson accept that failure is not impossible - Russia is, after all, embarking on three epic changes simultaneously: from dictatorship to democracy, from command economy to the free market, and from empire to nation state. But they present the chudo option only after rejecting or limiting three other scenarios. The first, 'muddling down' is more or less a continuation of the present; this, they believe, can only be transitional. The second, the 'two-headed eagle', is authoritarianism that would seek to recover much economic centralisation but would lead on either to liberalisation or to a heftier clamp-down. The third is a 'time of troubles' which would be resolved in either a de facto break-up of Russia or an aggressive anti-Western dictatorship. Yergin and Gustafson judge neither of these to be likely for historical and sociological reasons. They also rule out, repeatedly, any return to Communism, as utterly discredited.

But it is their arguments for the 'miracle' that make this book so valuable for anyone with even the most fleeting interest in the future of Russia. Many of these arguments bear repeating, since they are rarely noted in print.

First, a new economy is growing up alongside the old, but the statistics do not reflect this: 'in the old Soviet economy, managers had an incentive to exaggerate their production; today managers have the opposite incentive. They underreport high output to avoid high taxes'. Official GNP is thus 'an inadequate, incomplete and increasingly misleading measure of people's actual welfare'.

Second, there is very little alternative to democracy. The army will not be able to take over because 'the ranks of military and security officers are deeply split'. Organised crime is not about to take over because it is 'a symptom, not a prime mover'. Legality of commerce is a problem, but only 'because the law has not caught up with the new fact of private enterprise'. Nor will the extremist 'red-brown' (Communist-Fascist) alliance succeed: it is 'badly divided'.

Third, Russia is unlikely to collapse or break up: 'No modern society has gone through such high inflation and depression, the ravaging of its population's living standards, the destruction of its political system and the collapse of its official ideology, not to mention the breakup of its borders . . . yet . . . life goes on.' 'At the moment what gets attention is the divisive forces in Russia, but there are also reintegrating elements.' These include 'the Russians' sense of national identity based on language and shared history'.

Fourth, any change for the better will bring greater benefits than expected: 'The command economy was so inefficient . . . that any improvement at all quickly brings benefits.' Less production does not necessarily mean less happiness, if what is produced is wanted, not wasted. The decline in investment may not have as severe an effect as predicted, as investment is not going into dinosaur industries.

Fifth: 'Western aid cannot save Russia. Only Russia can build the Russian economy, but Western aid can help . . . by supporting the transition at critical points.'

These arguments are all crucial to any assessment of Russia's prospects. Yet how often are they voiced? Yes, Russia is currently chaotic, weak and unpredictable. But it is also a huge and potentially very rich country, with an educated and often ingenious work force - they had to be to make Communism work for as long as it did. They will not be on the sidelines in poverty for ever.

I offer only two criticisms. The second chapter, setting out the historical background up to the fall of Soviet Communism, is peppered with inaccuracies. This is a pity because it is bound to cast doubt on facts, figures and judgements adduced later - whose accuracy seems mostly unimpeachable. Second, the four potential future scenarios emerge as less clear-cut than the book suggests. Yet the thesis that a Russian economic miracle is, albeit by a short head, the most likely outcome to emerge from the current chaos must be helped to come across loud and clear. There are a great many influential people out there who do not want to hear it.

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