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US Debate: To Russia With Aid?

THE most critical case in Washington's foreign-aid debate is put to the test this week as the Clinton administration and Republican lawmakers clash over funding for post-Soviet republics.

Aid advocates caution that withholding support will cause instability in the fledgling states and jeopardize international security. A retreat will erode United States leadership abroad, they warn.

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But detractors are picking up on popular opinion. In its February poll on American views concerning national security, the Times Mirror Center for the People and the Press found that 58 percent of respondents opposed giving financial assistance to Russia, the symbol of the former Soviet Union.

That ''aid fatigue,'' coupled with Russia's attack on Chechen separatists, has prompted Senate Foreign Relations Committee Chairman Jesse Helms (R) of North Carolina to recommend a suspension of the program. Other GOP leaders contend the money is wasted by corrupt aid recipients who abscond with the cash and fail to follow through on reforms.

Countering critics' charges that aid dollars are wasted, James Morris, US Agency for International Development mission director in Moscow, says cash handouts are rare. Roughly 80 percent of AID's efforts are outside the big cities where local governments and businesses put technical help to use by learning how to manage private-sector firms, create a criminal justice system, and develop a financial sector.

Thomas Dine, a top official at AID, insists that skewed facts from Washington insiders lead Americans to miscalculate the costs of foreign aid and the need to shore up political and economic reform where nationalism threatens democracy.

He says he is battling a number of anti-foreign aid factions on Capitol Hill including: isolationist lawmakers rejecting foreign aid; legislators who are anxious to cut any spending program that comes before them; and a group that views cutting foreign aid as a means of punishing Russia for transgressions -- specifically its crackdown on Chechnya and its military sales to Iran.

Mr. Dine, of course, is doing his best to bolster lawmakers interested in aid as a means of promoting US strategic interests. But many observers insist that what needs bolstering is support in the White House itself, where President Clinton and his top advisers are reluctant to move to the front lines.

While the Senate considers the House of Representatives' proposed cuts in an $850-million package targeted largely for Russia, a congressional staffer sums up the GOP approach: ''The bottom line is that it's up to the president. He's the ultimate leader in foreign policy. If he believes there's a strong American interest at risk, then he should seek bipartisan support.''

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Ukraine's Economy Minister Roman Shpek, seeking $900 million from international donors, was in Washington last week to secure Clinton's backing. The US should lead by loosening its purse strings and set a ''good example for Europe and also Japan,'' he said. ''We were reassured that the US considers the development of Ukraine's economy in its national interest.''

BUT Anders Aslund, who co-directs the New Independent States program at the Carnegie Endowment for International Peace, isn't so sure that the US is solidly behind the Ukraine. ''The problem here is the administration, which blames Congress in a not very credible way,'' says Mr. Aslund, a current top consultant to Ukraine's economic reformers. The once-bullish ''Russia first'' lobby in the White House is now bearish ''due to political reasons after Chechnya,'' he says. The retreat has meant that the White House has abandoned its effort to balance Russian support with aid to the Ukraine, which has had uneasy relations with its Russian neighbor.

Much is at stake in the NIS, Aslund adds: ''It's very important [for reform] to thrive on the momentum [of aid flows]. There is a weak [reform-oriented] elite confronted by a forceful opposition.''

US aid defenders say that even the International Monetary Fund, which imposes the most exacting economic reform conditions on borrowers, places a premium on helping Russia and Ukraine simultaneously. ''We must make sure that in helping one, we do it in a way that is compatible with the interest of the other,'' says IMF managing director Michel Camdessus.

On March 19, Mr. Camdessus agreed to release a $6.5 billion standby loan to Russia, softening Russia's hard stance toward its neighbor and debtor, Ukraine. Camdessus' recent efforts to broker an agreement on Ukraine's debts to Russia -- he mediated the rescheduling on the $2.5 billion Kiev owes Moscow -- have helped diffuse tensions between the two republics and pave the way for the IMF to sign a $1.8 billion deal with Ukraine.

The US has contributed roughly 10 percent of all foreign assistance to Russia and other republics since 1990. While Germany is the single-largest donor to date, the balance of the help has come from European countries, Japan, the IMF, and the World Bank. AID's Dine, who detects a lack of consensus on the issue among the lawmakers he's been canvassing, wants to convince them that ''we're not carrying the burden ... yet we must fulfill our commitment to help.''

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