The Clinton administration faced another “no alternative” moment in February 1996 when Yeltsin announced he would seek reelection. His prospects looked bleak: he ranked dead last in the polls, with only single-digit appeal.
White House advisers suggested Clinton distance himself, but the president was determined to stand by Old Boris regardless of the risks. As Talbott reports, Clinton “let us know that he didn’t want to be lectured further on the subject.” “I know the Russian people have to pick a president,” Clinton told him, “and I know that means we’ve got to stop short of giving a nominating speech for the guy. But we’ve got to go all the way in helping in every other respect.”
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The relay between Richard Dresner and Clinton’s chief strategist Dick Morris, however, crossed the line. In his memoir
Behind the Oval Office, Morris notes that Dresner offered to keep him in the loop on the Russian presidential race. With Clinton’s approval, Morris received weekly opinion poll briefings that he would share with the president, who would in turn pass on recommendations to Dresner via Morris.
Moreover, Morris describes this “relationship [as] particularly useful” when Clinton visited Moscow in April 1996. Clinton wanted to know how he could help Yeltsin, and Dresner dutifully called with his suggestions.
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If one aspect of American intervention played a decisive role in Yeltsin’s victory, it came when Clinton helped secure a $10.2 billion IMF loan in March 1996. But the assistance didn’t stop there.
Two weeks later, Germany and France loaned Yeltsin’s government $2.7 billion and $400 million, respectively. That sum conveniently covered the cost of his election-year spending promises.
All the cash quickly vanished. For example, Russia’s foreign currency reserves declined from $20 billion to $12.5 billion in the first half of 1996. The Russian government spent at least $9 billion, almost equal to the IMF loan.
According to Paul Klebnikov, “
ome of the money went to the Yeltsin campaign, some to well-connected businessmen and government officials, some to pay ordinary Russians their long overdue paychecks.”
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The next day, in one of the infamous moments of the campaign, Streletsky busted Arkady Yevstafyev and Sergei Lisovsky — two Chubais guys — coming out of the White House carrying $500,000 in a Xerox paper box. According to Korzhakov, the campaign delivered packages like that all over the country to buy off regional elites and secure votes.
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As a 2000 congressional evaluation of the Clinton administration’s Russia policy put it: “By pursuing a policy of ‘reform’ that required the political victory of their reformers by whatever means necessary, the administration undermined the democratic process itself."