    [House Hearing, 112 Congress]
    [From the U.S. Government Publishing Office]

    RUSSIA 2012: INCREASED REPRESSION, RAMPANT CORRUPTION, ASSISTING ROGUE
                                    REGIMES

    =======================================================================

                                    HEARING

                                   BEFORE THE

                          COMMITTEE ON FOREIGN AFFAIRS
                            HOUSE OF REPRESENTATIVES

                          ONE HUNDRED TWELFTH CONGRESS

                                 SECOND SESSION

                                   __________

                                 MARCH 21, 2012

                                   __________

                               Serial No. 112-141

                                   __________

            Printed for the use of the Committee on Foreign Affairs

    Available via the World Wide Web: http://www.foreignaffairs.house.gov/
                                      or
                           http://www.gpo.gov/fdsys/

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                          COMMITTEE ON FOREIGN AFFAIRS

                     ILEANA ROS-LEHTINEN, Florida, Chairman
    CHRISTOPHER H. SMITH, New Jersey     HOWARD L. BERMAN, California
    DAN BURTON, Indiana                  GARY L. ACKERMAN, New York
    ELTON GALLEGLY, California           ENI F.H. FALEOMAVAEGA, American
    DANA ROHRABACHER, California             Samoa
    DONALD A. MANZULLO, Illinois         DONALD M. PAYNE, New Jersey--
    EDWARD R. ROYCE, California              deceased 3/6/12 deg.
    STEVE CHABOT, Ohio                   BRAD SHERMAN, California
    RON PAUL, Texas                      ELIOT L. ENGEL, New York
    MIKE PENCE, Indiana                  GREGORY W. MEEKS, New York
    JOE WILSON, South Carolina           RUSS CARNAHAN, Missouri
    CONNIE MACK, Florida                 ALBIO SIRES, New Jersey
    JEFF FORTENBERRY, Nebraska           GERALD E. CONNOLLY, Virginia
    MICHAEL T. McCAUL, Texas             THEODORE E. DEUTCH, Florida
    TED POE, Texas                       DENNIS CARDOZA, California
    GUS M. BILIRAKIS, Florida            BEN CHANDLER, Kentucky
    JEAN SCHMIDT, Ohio                   BRIAN HIGGINS, New York
    BILL JOHNSON, Ohio                   ALLYSON SCHWARTZ, Pennsylvania
    DAVID RIVERA, Florida                CHRISTOPHER S. MURPHY, Connecticut
    MIKE KELLY, Pennsylvania             FREDERICA WILSON, Florida
    TIM GRIFFIN, Arkansas                KAREN BASS, California
    TOM MARINO, Pennsylvania             WILLIAM KEATING, Massachusetts
    JEFF DUNCAN, South Carolina          DAVID CICILLINE, Rhode Island
    ANN MARIE BUERKLE, New York
    RENEE ELLMERS, North Carolina
    ROBERT TURNER, New York
                       Yleem D.S. Poblete, Staff Director
                 Richard J. Kessler, Democratic Staff Director

                                C O N T E N T S

                                  ----------
                                                                       Page

                                   WITNESSES

    The Honorable David J. Kramer, President, Freedom House..........    10
    Mr. William F. Browder, chief executive office, Hermitage Capital
      Management.....................................................    26
    The Honorable Steven Pifer, director of the Brookings Arms
      Control Initiative, Brookings Institution (former U.S.
      Ambassador to Ukraine).........................................    31
    Leon Aron, Ph.D., director of Russian studies, American
      Enterprise Institute...........................................    44

              LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING

    The Honorable David J. Kramer: Prepared statement................    13
    Mr. William F. Browder: Prepared statement.......................    28
    The Honorable Steven Pifer: Prepared statement...................    33
    Leon Aron, Ph.D.: Prepared statement.............................    46

                                    APPENDIX

    Hearing notice...................................................    64
    Hearing minutes..................................................    65
    The Honorable Gerald E. Connolly, a Representative in Congress
      from the Commonwealth of Virginia: Prepared statement..........    67
    The Honorable Gregory W. Meeks, a Representative in Congress from
      the State of New York: Material submitted for the record.......    68
    The Honorable David J. Kramer: Material submitted for the record.    80
    Leon Aron, Ph.D.: Material submitted for the record..............    85

    RUSSIA 2012: INCREASED REPRESSION, RAMPANT CORRUPTION, ASSISTING ROGUE
                                    REGIMES

                                  ----------

                           WEDNESDAY, MARCH 21, 2012

                      House of Representatives,
                                  Committee on Foreign Affairs,
                                                        Washington, DC.
        The committee met, pursuant to notice, at 10:30 a.m., in
    room 2172 Rayburn House Office Building, Hon. Ileana Ros-
    Lehtinen (chairman of the committee) presiding.
        Chairman Ros-Lehtinen. The committee will come to order.
    And before we give our opening statements on today's timely
    topic, I know that my good friend, the ranking member Mr.
    Berman has an important announcement to make. Timing is
    everything.
        Mr. Berman. Timing is everything. Madam Chairman, thank you
    very much. I'd like to make a brief announcement about the
    Subcommittee on Africa, Global Health and Human Rights. We all
    mourn the loss of our dear friend and colleague, Don Payne, one
    of our Nation's foremost experts on Africa, and a valued member
    of this committee.
        As all of us know, Don's untimely passing has left a
    vacancy in the ranking member slot for the Subcommittee on
    Africa, Global Health and Human Rights. I wanted to take this
    opportunity to announce that Representative Karen Bass, the
    next Ranking Democrat on the subcommittee, has been appointed
    to serve as ranking member of the subcommittee for the
    remainder of the 112th Congress pursuant to Rule 29C of the
    House Democratic Caucus rules, a document I'm sure all of you
    are familiar with.
        I'm certain Representative Bass will continue to focus on
    many of the issues that were important to Don, including Food
    Aid, Sudan, DRC, and conflict prevention across the African
    Continent. And I think she'll do a tremendous job. With that, I
    yield back.
        Chairman Ros-Lehtinen. Thank you so much, Mr. Berman. And
    you're so right, while all of us continue to miss Congressman
    Don Payne and everything that he brought to this committee and
    to the institution, we're thankful for the opportunity to work
    with Karen Bass in her new role. We look forward to her
    contributions in the months ahead. So, welcome.
        Well, thank you. After recognizing myself and my friend,
    the ranking member Mr. Berman for 7 minutes each for our
    opening statements, I will recognize for 3 minutes the chair
    and ranking member of the Subcommittee on Europe and Eurasia
    for their opening remarks. I will then recognize other members
    seeking recognition for 1 minute. We will then hear from our
    witnesses, and without objection the written statements of all
    of our witnesses will be made a part of the record. And members
    may have 5 days to insert statements and questions for the
    record.
        The Chair now recognizes herself for 7 minutes.
        There is an old saying that says the more things change the
    more they stay the same. I'd give it in French but it's not so
    good. That phrase is particularly apt regarding Vladimir
    Putin's recent return to the presidency. Although his stand-in,
    Dimitri Medvedev, has occupied the post for the past 4 years,
    everyone knew that Putin still held the real power. And now he
    has stepped into the spotlight again ending the charade.
        Although there was no sign of a significant change in his
    course, this is a good time for us to take stock of where
    things stand in terms of the domestic situation in Russia and
    in its foreign policy, especially regarding U.S. interest.
        On the domestic front there is good news and bad. First the
    bad news. The regime continues to monopolize power with
    corruption entrenched throughout the entire government
    structure and reaching far into the economy and the general
    society.
        Moscow persecutes human rights activities and the political
    opposition including banning parties, forcibly breaking up
    rallies, and jailing and beating those who dare to defy it.
        Several perceived enemies have actually been killed, even
    murdered, as one of our witnesses will recount today. But there
    are also hopeful signs that the Russian people have begun to
    stand up to the regime and demand their basic rights.
        The massive demonstrations that followed last December's
    parliamentary elections which were characterized by open fraud
    have demonstrated that the people are losing their fear and are
    demanding fundamental political change. On the foreign policy
    front, however, I'm afraid there is only bad news.
        Putin is escalating his anti-American rhetoric and accuses
    the U.S. of one anti-Russian plot after another. But it isn't
    just rhetoric: His actions constitute a direct threat to U.S.
    interests and those of our allies.
        Regarding Iran, Russia continues to block efforts by the
    U.S. and other responsible nations to force Tehran to halt its
    nuclear weapons program, thereby encouraging the Iranian regime
    to press ahead.
        In Syria, Russia is helping to prop up the Assad regime by
    blocking U.N. Security Council Resolutions that are aimed at
    stopping the ongoing atrocities. Russia is sending warships to
    Syrian ports, selling weapons to the Assad regime to be used
    not only against its own people but potentially against Israel
    and other U.S. allies.
        Putin's determination expand Moscow's influence was
    demonstrated most dramatically by the invasion of Georgia in
    2008, and Russia's continuing occupation of major areas of that
    U.S. ally.
        Russia has suffered no significant costs from the West as a
    result of this aggression which can only encourage it to use
    force in the future. Not surprisingly, Russia's threat to NATO
    is growing.
        Russia has said that it will aim its missiles at NATO if
    the U.S. does not abandon its efforts to establish a missile
    defense shield in Europe against Iranian ballistic missiles.
        Independent experts agree that the planned missile defense
    poses no danger to Russia whatsoever, and Russian technicians
    know this as well. But Russia's real purpose is to establish a
    veto over NATO policy, as well as to demonstrate to the
    countries in Central and Eastern Europe that membership in the
    Atlantic Alliance will not protect them from Russian influence.
        In our hemisphere, Russia has become a friend to a number
    of U.S. enemies, including selling large quantities of
    conventional weapons to the Chavez regime in Venezuela.
        I don't know of anyone who expects Russia's policy toward
    the U.S. to change for the better, so what should the U.S. do?
    The most important step must be to stop giving Moscow one
    concession after another, and getting virtually nothing in
    return. In pursuit of this so-called reset the U.S. has handed
    Moscow a one-sided agreement on strategic nuclear weapons,
    removed sanctions on Russian companies known to have aided
    Iran's weapons program, and signed a very lucrative nuclear
    cooperation agreement, among many other concessions. The most
    recent gift was U.S. approval last December of Russia's entry
    into the World Trade Organization, including pressuring our
    ally, Georgia, to go along despite the fact that Russia
    continues to occupy its territory.
        Russia's entry into the WTO with U.S. support is astounding
    given that Russia continues to be one of the biggest violators
    of intellectual property rights, robbing U.S. citizens and U.S.
    companies of billions of dollars every year. For years, the
    Russian Government has promised to stop this piracy, but too
    many of the regime supporters benefit from it, so the theft
    continues. And now the administration is seeking to give Russia
    Permanent Normal Trade Relations. This requires lifting the
    restrictions of the Jackson-Vanik Amendment.
        That Amendment has long been a symbol of U.S. commitment to
    human rights and democracy in Russia. Removing Russia from its
    provisions would be interpreted in Moscow and elsewhere as a
    seal of approval from the United States Congress, even as the
    human rights situation in Russia continues to deteriorate. I
    hope that Congress will not grant one more concession to Russia
    without first holding Moscow accountable for actions that run
    contrary to U.S. national security interests and to such
    foreign policy priorities as the promotion of human rights and
    democracy.
        There are many more issues with Russia that could be added
    to this list, and I look forward to discussing these and other
    issues with our distinguished panel.
        I now turn to the ranking member, Mr. Berman, for the
    remarks of his opening statement.
        Mr. Berman. Well, thank you very much, Madam Chairman.
        This hearing on Russia 2012 comes at an important time in
    our bilateral relations. During the past 3 years, there have
    been some important successes in our new engagement with
    Russia, but there also have been some disappointing setbacks on
    democracy, human rights, and the Rule of Law, as well as
    foreign policy. And I'm afraid the return of Vladimir Putin as
    Russia's President will make further progress more difficult.
        In the run up to Presidential elections earlier this month,
    Putin once again resorted to the anti-American rhetoric that
    was the trademark of his nearly decade-long relationship with
    the Bush administration.
        Putin may be the same authoritarian ruler that he was
    before, but as the chairman pointed out, there are hopeful
    signs that the Russian people's tolerance for this type of rule
    has changed since he first assumed the presidency in 1999.
        The clearest signs of this change are the protests that
    occurred after the most recent parliamentary and Presidential
    elections. Neither of these elections was ``free and fair'' by
    international election standards. Both were marred by efforts
    to deny opposition parties and candidates the ability to run,
    the use of overwhelming administrative resources in favor of
    Putin and his United Russia party, known in the Russian
    blogosphere as the ``Party of Cheats and Thieves,'' and voting
    day irregularities that have become a hallmark of Russian
    elections.
        In response, over 100,000 people demonstrated near the
    Kremlin in sub-zero temperatures against the conduct of the
    December 2011 parliamentary elections. In the months that
    followed, smaller demonstrations occurred in Moscow and
    throughout several cities across Russia demanding election
    reform. It's too early to tell if this movement will continue
    into the spring, but we should support the Russian people and
    their renewed civic activism. I, for one, am hopeful that this
    burgeoning civil society will prove stronger than Putin and his
    former KGB cronies.
        On the international front, I'm troubled by the repeated
    statements of Russian officials that Moscow will not support
    additional sanctions at the U.N. Security Council to prevent
    Iran from developing a nuclear weapons capability. On a
    somewhat more positive note, the Russians recently reaffirmed
    their September 2010 decision not to provide the advanced S-300
    surface-to-air missile system to Tehran.
        Russia's policy on Syria is simply wrong and indefensible,
    and I share Secretary Clinton's sentiment that the Russian and
    Chinese veto of the Arab League proposal in the United Nations
    Security Council was despicable. The Russian Government must
    immediately cease its supply of weapons to the murderous Assad
    regime. The chairman's bill, the Syria bill includes an
    amendment I offered that would sanction those Russian companies
    complicit in this deadly business.
        Russia's accession package to join the World Trade
    Organization is the toughest ever negotiated for a prospective
    member, thanks to the perseverance and leadership of U.S.
    negotiators. But make no mistake, Russia is going to get into
    the WTO this summer.
        Since 1994 successive U.S. Presidents have granted Russia
    annual waivers from the application of Cold War era Jackson-
    Vanik trade restrictions. If the U.S. Congress does not
    completely graduate Russia from Jackson-Vanik and grant
    permanent normal trade relations, that won't stop Russia from
    joining the WTO, but U.S. companies and American workers will
    not get the full benefit of Russia's membership in the WTO, and
    the tough accession package we negotiated.
        Like the chairman, I have serious reservations about the
    protection of intellectual property in Russia, but believe that
    the USTR can finish negotiating an action plan to strengthen
    the rights of American intellectual property owners before
    Russia joins the WTO this summer.
        Madam Chairman, there is no denying the fact that we have
    significant areas of disagreement with Russia, including
    Russia's record on human rights, democracy, and the Rule of
    Law, its conflict with Georgia, and Moscow's arms sales to
    dictatorial regimes. But focusing only on these issues creates
    a distorted picture of a complex U.S.-Russia relationship, nor
    does it serve our interest to become so fixated on the occupant
    of the Kremlin that we lose sight of other developments in
    Russian society.
        I look forward to hearing the views of a very distinguished
    panel and their recommendation for how we can best support the
    aspirations of the Russian people to build a democratic,
    stable, and prosperous Russian state. I yield back.
        Chairman Ros-Lehtinen. Thank you very much, Mr. Berman.
        Now, we will yield for 3 minutes each to Mr. Burton, the
    chairman of the Subcommittee on Europe and Eurasia, to be
    followed by Mr. Meeks, the ranking member on that committee.
        Mr. Burton. Thank you, Madam Chairman.
        In December 2011, the Russian people took to the streets to
    protest what they perceived as an injustice and an affront to
    their democratic rights. Among allegations of widespread
    corruption during the parliamentary elections, the Russian
    people decided that they'd had enough. Since then, we witnessed
    months of peaceful protests throughout Russia. These protests
    have not been facilitated by or in support of any one political
    party. And these protests have not been driven by western
    influences or special interests. These protests are the work of
    every day Russians who want a better life through a stronger
    democracy.
        As Americans, we naturally identify with those who seek a
    strong democracy. We're presented with a special opportunity to
    help the Russian people as we did during the fall of Communism
    in the next steps of their natural progression toward democracy
    and open markets. It's easy to forget that Communism only ended
    two decades ago. Russia is still a young democracy.
        As the Russian people push their leaders toward reform we
    can make a choice to engage Russia or to confront Russia.
    Russia, in my opinion, deserves to be engaged. The Russian
    economy is eager for U.S. investment. The Russia people have a
    growing appetite for movies, our movies, our music, our brands,
    and for most aspects of Western culture.
        Last July I was in Moscow, and as I was walking the streets
    of Moscow, I could have mistaken the people shopping, and
    dining, and commuting as people from Indianapolis.
        Let me be clear, I don't want to grant Russia a free pass.
    The administration's reset has failed. We are no closer to an
    agreement on missile defense than we were 3 years ago, and
    Russian peacekeeping troops still illegally occupy portions of
    Georgia and Moldova, while Russia still supports regimes such
    as those in Tehran and Damascus.
        As we engage Moscow, we must be clear that the status quo
    on these issues is not acceptable. As part of this engagement,
    I hope we will continue to look for ways to help the Russian
    people get the democracy and the human rights that they
    deserve.
        The Russian market really presents an opportunity. I'm
    convinced of that after meeting with AmCham, the American
    Chamber of Commerce, when I was over there. As Russia enters
    the World Trade Organization, growing demand for American goods
    and services can support over 50,000 U.S. jobs within 5 years,
    so we need to look for ways to create opportunities for us to
    be able to work with Russia to solve these problems. That
    doesn't mean we should not put pressure on them regarding human
    rights, and the need to really have democratic reforms.
        We could work to improve U.S.-Russian relations to the
    benefit of both the U.S. and Russian people; however, this is
    only possible through engagement which right now don't really
    have, have not yet achieved. I yield back the balance of my
    time.
        Chairman Ros-Lehtinen. Thank you very much, Mr. Burton.
        Mr. Meeks.
        Mr. Meeks. Thank you, Madam Chairman.
        The U.S.-Russia relationship remains at the top of our
    foreign policy agenda where it had been for more than half a
    century. During that time, the United States and Russia have
    cooperated on important matters, like we were allied in our
    fight against the Nazis 60 years ago, and our fight against
    terrorism today.
        The reality is, of course, that the United States and
    Russia do not and have not always seen eye-to-eye on important
    international concerns. The good news, however, is that our
    leaders are no longer locked eyeball to eyeball, missiles aimed
    in each other's directions waiting for one to blink.
        My goal as a member of the United States House of
    Representatives is to do all that is possible to move the
    relationship toward the end of the spectrum that involves
    bilateral and multilateral cooperation. I am hopeful that we
    are headed in that direction despite the many, many challenges
    that remain.
        In fact, on some of the day's most urgent concerns we may
    be getting closer to an agreement. Yesterday's press reported
    the Russian Foreign Minister said Russia is ready to endorse a
    U.N. Security Council statement or resolution backing Kofi
    Annan's Syrian peace mission.
        It has more than two centuries for the United States to
    achieve the imperfect form of democracy by which we govern
    ourselves today. As far as I'm concerned, U.S. democracy is
    still a work in progress. Any African American would agree. We
    look at a case that's happening now in Florida. Any American
    woman would agree that we are still a democracy in progress.
        In less than 100 years Russia has emerged from the grim
    control of czars and dictators to a democratic rule, though it
    is certainly imperfect, and at times even at risk. Let's be
    realistic, the Russian democracy is a work in progress. Realism
    does not mandate that we ignore or make excuses for serious
    shortcomings of our partners, quite the opposite. It means we
    address them.
        In the interest of Russian democracy and the welfare of the
    Russian people it is our responsibility not to disengage from
    Russia, not to turn our backs on them because of our own
    domestic policies. We have a tremendous opportunity to deepen
    our engagement with Russia to the benefit of U.S. businesses,
    U.S. jobs, and Russian Rule of Law. It is our responsibility to
    take advantage of this opportunity, and I believe granting PNTR
    to Russia is one of the most important ways to encourage and
    support improvements in the Rule of Law. The U.S. has worked
    for nearly 25 years to that end by assisting Russia's WTO
    accession process. We shouldn't pull back now.
        In closing, I'd like to submit for the record several
    documents that the committee should consider, the U.S. Chamber
    of Commerce Russia PNTR Premier, letters from prominent members
    of Russian civil society and opposition leaders that want to
    see Jackson-Vanik lifted, and a letter from 171 U.S. companies
    that are ready to take advantage of Russia's WTO accession.
        Chairman Ros-Lehtinen. Without objection subject to the
    length limitation in the rules.
        Thank you, Mr. Meeks.
        Mr. Smith is recognized for 1 minute.
        Mr. Smith. I want to thank you, Madam Chair, for holding
    this very timely hearing on Russia.
        The Russian Government has on many occasions accepted and
    even solemnly agreed that issues of human rights and the Rule
    of Law are of international concern and do not belong
    exclusively in the realm of internal affairs; yet, the same
    Russian Government never tires of accusing our Government of
    meddling when we raise human rights issues.
        At this moment, allow me to touch on one issue. While the
    war in Chechnya no longer rages the situation on the ground
    there and across the Northern Caucuses is far from settled.
    Journalists and activists in this region continue to be killed,
    disappeared, beaten, or forced to flee for their lives, so we
    have very little credible information on what is going on
    there. I look forward to hearing our witnesses' assessment of
    that situation and their suggestions for Congressional action.
    I yield back.
        Chairman Ros-Lehtinen. Thank you so much.
        Mr. Deutch is recognized.
        Mr. Deutch. Thank you, Madam Chairman, Ranking Member
    Berman for holding today's hearing.
        There is no doubt that the U.S.-Russia relationship is
    facing its share of challenges. Russia is facing domestic
    challenges as the aftermath of the December parliamentary
    elections followed by the re-election of Vladimir Putin has
    spurred opposition protest, the strength of which will likely
    be determined in the coming months. It's my hope that Russia's
    leaders choose to meet these challenges with respect for human
    rights and the democratic process.
        Like most of my colleagues, I remain seriously concerned
    about Russia's sale of weapons to Assad's forces in Syria, and
    it's outrageous obstruction at the U.N. Security Council.
    Russia's insistence on watered-down resolutions at the Security
    Council and at the IAEA on the Iranian Nuclear Program
    undoubtedly sets it at odds with the U.S. and our western
    allies.
        Last summer I joined Chairman Burton in Russia where I had
    the opportunity to discuss at length an area of particular
    concern, the protection of intellectual property rights and
    Russia's failure to sufficiently take on those who traffic in
    the sale of American creative content. I also visited the
    Schneerson Collection, and I believe that we must continue to
    press for these important writings to be returned to the Chabad
    community.
        I look forward to hearing from our witnesses about ways we
    continue to develop our relationship as we simultaneously
    address these challenges, and I yield back, Madam Chairman.
        Chairman Ros-Lehtinen. Thank you, sir.
        Mr. Rohrabacher is recognized.
        Mr. Rohrabacher. Thank you very much, Madam Chairman, and
    thank you for holding this hearing. And first of all, I want to
    say that I was proud to have been on that team under Ronald
    Reagan that brought down the Soviet Union, probably the thing
    I'm most proud of in my whole life. But it is disturbing to me
    that so many decision makers in Russia and in the United States
    are still locked into a Cold War mentality. We constantly hear
    exaggerations of Russia's shortcomings, and using the most
    sinister words to describe imperfections that need to be worked
    on.
        What we are doing this way is we are undermining the broad
    area of cooperation that would be mutually beneficial to our
    two countries, not just economic cooperation but also in our
    national security cooperation in dealing with China, which is a
    major threat to both of our countries, and dealing with radical
    Islam which, of course, is a threat to both of our countries.
        I am heartened yesterday by the Russian Foreign Minister's
    statement that they may be cooperating with us in providing
    supplies to our people in Afghanistan. That's the type of
    cooperation we need. Let's reach out to the Russians rather
    than punching them in the nose all the time.
        Chairman Ros-Lehtinen. Thank you very much.
        Mr. Connolly.
        Mr. Connolly. Thank you, Madam Chairman. And I certainly
    take our colleague's remarks just now to heart, but I think we
    have a difficult challenge here. I think that it's vitally
    important, frankly, that the United States and Russia work out
    a modus vivendi that works for both of us, and that hopefully
    adds to international security, whether it be terrorism,
    whether it be Middle East peace process, whatever.
        But I think we can't do that by glossing over some of the
    stark differences and some of our legitimate concerns about the
    nature of the Russian Government and its polity, and its
    foreign policy. It's hurting us in Syria. We have a legitimate
    reason to be concerned about human rights crackdowns, and
    jurisprudence in Russia. And, frankly, the recent election is
    also of concern in terms of its process and the obvious
    corruption that accompanied it.
        So, I think that we have to assert our values while trying
    to make this relationship work. And I think that's really the
    challenge moving forward. I thank the chair.
        Chairman Ros-Lehtinen. Thank you.
        Mr. Royce is recognized.
        Mr. Royce. The Obama administration I think is wrong when
    it says nothing should replace Jackson-Vanik's repeal. The
    administration's argument is trust us, we'll promote democracy
    and human rights. But as witnesses will testify this morning
    the State Department falls far short.
        It's clear that human rights and rule of law legislation
    should follow Jackson-Vanik repeal, in my opinion. For example,
    in 2008 Sergei Magnitsky uncovered evidence of police
    corruption and embezzlement. The police put him in prison. Even
    the Russian Government Human Rights Committee that investigated
    his death found that he was severely beaten and denied
    treatment, and recommended that his prison doctors and
    interrogators be investigated; instead, they were given
    promotions. So, something needs to replace the repeal of
    Jackson-Vanik that's focused on the rule of law in Russia.
        Thank you. I yield back.
        Chairman Ros-Lehtinen. Thank you.
        Mr. Turner.
        Mr. Turner. Thank you, Madam Chair, and thank you
    witnesses.
        I, like many Americans, grew up during the Cold War. And in
    1991 we greeted the collapse of the Soviet Union with great
    relief. I've had the occasion to visit Russia seven times,
    Georgia once, and six times all on business. I've had firsthand
    knowledge trying to do honest business with partners like PNG
    and American Entertainment Companies to get a reasonable deal
    done. It never worked, but I did get some firsthand knowledge
    and some almost unbelievable experiences in Russia and Georgia.
        The disappointment that there is no Rule of Law, that there
    is no system where people can rely on their courts and justice
    is most disappointing. And I think this is the way Mr. Putin
    likes it, crony capitalists stocked with ex-KGB men, industrial
    oligarchs all combining to make this system unworkable.
        I look forward to hearing what you have to say. Thank you.
    I yield back.
        Chairman Ros-Lehtinen. Thank you.
        Mr. Chabot is recognized.
        Mr. Chabot. Thank you, Madam Chair.
        The modern American-Russian relationship is an important
    one and should be a constructive one, and a mutually beneficial
    one. This is particularly true when one considers how far we've
    come since a decade's long Cold War when we were on opposite
    sides on virtually every issue, and for the most part bitter
    rivals. Unfortunately, as my colleagues on both sides of the
    aisle have already referred to and indicated, and I would agree
    with, Russia, particularly with Putin continuing to pull the
    strings is a very challenging partner.
        True democracy continues to be suppressed, human rights and
    Rule of Law are too often an afterthought, and their actions
    around the globe especially with respect to Syria and Iran are
    particularly unhelpful; in fact, downright infuriating.
        I look forward to hearing from the panel members on how we
    should deal with this matter. Thank you, Madam Chair.
        Chairman Ros-Lehtinen. Thank you, and I thank all of the
    members, including Mr. Modus Vivendi for sharing that insight
    with us.
        We're not going to forget that any time soon are we, Mr.
    Chandler?
        I'd like to introduce our witnesses this morning. We are
    very excited to have an excellent panel of experts on the issue
    of Russia. David Kramer, we'll begin with him, is the president
    of Freedom House. He joined in October 2010. We all know him in
    his previous slot as Assistant Secretary of State for
    Democracy, Human Rights and Labor from March 2008 to January
    2009. He was also Deputy Assistant Secretary of State for
    European and Eurasian Affairs where he was responsible for
    Russia, Ukraine, Moldova, and Belarus, as well as regional non-
    proliferation issues. Previously, he served as a professional
    staff member in the Secretary of State's Office of Policy
    Planning. Welcome.
        We will then hear from William Browder, who is the founder
    and CEO of Hermitage Capital Management. Mr. Browder was the
    largest foreign investor in Russia until 2005 November, where
    he was suddenly denied entry to the country and declared a
    threat to national security by the Russian Government.
        In recent years, he has devoted much of his effort to
    promoting the cause of Sergei Magnitsky, who was brought up by
    Mr. Royce a few minutes ago, a lawyer working for him who while
    investigating high-level corruption was arrested in Moscow in
    2008 and later died in prison. Welcome.
        Next we will hear from Steven Pifer, who is the senior
    fellow at the Brookings Center on the United States and Europe,
    and director of the Brookings Arms Control Initiative where he
    focuses on arms control, Russia and Ukraine.
        From 2001 and 2004 he served as Deputy Assistant Secretary
    of State in the Bureau of European and Eurasian Affairs with
    responsibilities for Russia and Ukraine. He also served as a
    U.S. Ambassador to Ukraine from 1998 to 2000, and as a Special
    Assistant to the President and Senior Director for Russia,
    Ukraine, and Eurasia on the National Security Council from '96
    to '97. Welcome, Mr. Ambassador.
        And last we will hear from Leon Aron, who is the resident
    scholar and director of Russian studies at the American
    Enterprise Institute. Dr. Aron earned his bachelor's degree
    from Moscow State Institute and his Ph.D. from Columbia
    University. He is the author of many books, articles and essays
    including the First Scholarly Biography of Boris Yeltsin. His
    latest work is the forthcoming book entitled, ``Roads to the
    Temple, Memory, Truth, Ideals and Ideas in the Making of the
    Russian Revolution,'' which will be published by Yale
    University Press this spring. Congratulations. And we will
    start with Mr. Kramer. Thank you.

    STATEMENT OF THE HONORABLE DAVID J. KRAMER, PRESIDENT, FREEDOM
                                 HOUSE

        Mr. Kramer. Madam Chair, thank you very much. Thanks for
    the opportunity again to appear before this committee.
        When we talk about this, I think it's very important to
    distinguish Russian's leadership and officialdom from the rest
    of Russia. The leadership I would describe as thoroughly
    corrupt, rotten, and rotting. And that kind of leadership, I
    would argue, poses severe obstacles for the kind of cooperation
    we would all like to see in U.S.-Russia relations.
        Russian officials from the very highest levels to the
    lowest ranks have become unbelievably greedy over the years and
    view the State's coffers and assets as their own personal
    trough. Personal enrichment, the get it while you can kind of
    attitude, has become the reason to serve in government for many
    officials. The INDEM think tank in Russia estimates that
    corruption costs the economy somewhere on the order of three
    hundred to $500 billion a year out of a GDP of $1.5 trillion.
        A growing number of Russians talk about emigrating from
    Russia as a result of the pervasive corruption. Capital flight
    last year was $84 billion, and in January alone of this year it
    was $13.5 billion. All of this, I would argue, explains why Mr.
    Putin has no willingness to relinquish his grip on power.
        Thus, it isn't surprising that the regime shows total
    disregard for human rights and democracy, and the human rights
    of its own people, or people in other countries. And the
    evidence of that, I would argue, comes with the arms sales to
    the regime in Syria.
        For more than a decade, Freedom House has been documenting
    the decline in democracy and human rights in Russia, a period
    that overlaps with Mr. Putin's reign, and Russia is deemed no
    free in our Freedom in the World and Freedom of the Press
    reports.
        The lack of accountability for human rights abuses and the
    grossly politicized legal system create an environment wherein
    such abuses are not only condoned but they're expected almost
    as a demonstration of loyalty to the regime. Essentially,
    Russian leaders for more than a decade have shown no respect
    for human rights, accountability, independent institutions,
    justice, and they refuse to allow a viable opposition to take
    root. They create an environment of impunity. And we've already
    seen a crackdown since the March 4th selection, not least the
    denial of a rally calling for justice in the murder of Sergei
    Magnitsky that's supposed to take place this weekend.
        Vladimir Putin heads a leadership, I would argue, that is
    assertive, arrogant, and aggressive on the one hand but
    paranoid, insecure, and hypersensitive on the other. And this
    is a dangerous and volatile combination. It explains why Putin
    cannot leave power. In a sense he's become hostage to his own
    system. He's the glue that holds it together, and were he to
    step down, he and those around him who have benefitted so
    handsomely from their positions of power would likely have to
    face investigations, if not worse. They have too much at stake
    to allow some new person to be elected President of the
    country.
        And it's the combination of arrogance and paranoia, I would
    argue, that explained the decision last September 24th when
    Putin and Medvedev announced they would switch positions. It
    explains why elections are predetermined before they take
    place. It explains why opposition parties, such as PARNAS, or
    opposition figures such as Grigory Yavlinsky are not allowed to
    complete fairly in the elections, or compete at all for that
    matter.
        And the paranoid side of Putin, I would say, also leads him
    to blame the United States and even Secretary of State Hillary
    Clinton for instigating last December's protest. And this is
    not just a function of Putin's paranoia, but of a likely
    perception of an emerging threat that he faces within his own
    country, and he wants to finger the United States and scapegoat
    us. And since his early years as President, Putin has always
    blamed the west for threatening Russia, rather than face the
    shortcomings of his own leadership.
        Now, without giving in to despair, as a number of you have
    pointed out, there have been some positive developments, not
    least the impressive turnouts in December and February of this
    year protesting the rigged elections for the Duma last December
    and the Presidential elections. And I think these protests
    have, in fact, been a source of inspiration and optimism as we
    look at Russia.
        The protests were really the loudest and clearest
    manifestations of ordinary Russians' increasing frustration
    with the lack of dignity and violations of their rights which
    have become routine under Putin. And they've said, essentially,
    enough is enough.
        And I would argue that there are three important
    conclusions to draw from the election; that Putin may claim
    victory as he did on March 4, but he has lost his unquestioned
    sense of legitimacy as more and more Russians suspect that he
    remains in power through illegitimate means. He's also lost his
    all-important aura of invincibility. That's been badly damaged.
    And finally, he has seen his use of fear eroded as more
    Russians come out in protest against his rule.
        Now, the future of Russia is going to be decided by
    Russians but there are things for the United States to do, not
    least is to speak about the situation on the ground inside
    Russia very candidly. And I commend Secretary Clinton for her
    remarks after the Duma elections last December which obviously
    got Mr. Putin's attention.
        I would like to see similar kinds of words coming from the
    President. The President, after all, has invested a great deal
    in developing U.S.-Russia relations, and yet his silence since
    a very good trip to Moscow in July 2009, silence when it comes
    to democracy and human rights concerns in Russia, I think has
    been unfortunately rather deafening.
        There is something for the Congress to do, I would argue,
    and I will end with this, Madam Chair, and that is to move
    forward on the Sergei Magnitsky Rule of Law Act. I strongly
    recommend its passage, and I know Bill Browder will talk about
    this more. Thank you very much.
        [The prepared statement of Mr. Kramer follows:]

                                  ----------

        Chairman Ros-Lehtinen. Thank you, sir.
        Mr. Browder.

     STATEMENT OF MR. WILLIAM F. BROWDER, CHIEF EXECUTIVE OFFICE,
                      HERMITAGE CAPITAL MANAGEMENT

        Mr. Browder. Madam Chairman, members of the committee,
    thank you very much for inviting me to speak today.
        The story that I'm going to share with you today will leave
    you in no doubt that Russia doesn't function as a normal state
    as we know it. It functions more akin to a criminal enterprise.
    The story that I want to tell you is about Sergei Magnitsky,
    who was my lawyer, who died in horrific circumstances in
    Russian state custody 2\1/2\ years ago. It is my duty to his
    memory and to his family to make sure that justice gets done in
    this case, and that this story gets told widely across the
    world.
        The story starts out 15 years ago. I moved to Russia and
    set up an investment fund called Hermitage Capital Management,
    which eventually grew to become the largest foreign investment
    fund in the country. In the process of investing, I learned
    that all the companies I was investing in were losing money
    through massive corruption, and I decided to fight the
    corruption by exposing it through the international media.
        As you might imagine, this created a number of enemies and
    as you mentioned in my introduction, I was expelled from the
    country, I was declared a threat to national security, and
    that's when the real trouble began.
        In 2007, my offices were raided by 25 police officers from
    the Interior Ministry of Moscow, which is the police
    department. They took away all of our corporate documents, and
    those corporate documents were then used to expropriate our
    companies. And then through a very complicated scheme, they
    then used those corporate documents to steal, not from us but
    from the Russian State, $230 million of taxes that we had paid
    in the previous year.
        I went out and hired a young lawyer named Sergei Magnitsky
    who worked for an American law firm called Firestone Duncan, to
    investigate. And Sergei went out and investigated, and found
    documentary evidence proving the involvement of high-level
    officials in the theft of the $230 million.
        Instead of turning a blind eye as many others in Russia
    would have done, he decided to testify against the officers,
    and he testified against them in October 2008. One month after
    his testimony he was arrested by the same people he had
    testified against, put in pretrial detention, and then tortured
    to withdraw his testimony. They put him in cells with 14
    inmates and eight beds and left lights on 24 hours a day in
    order to sleep deprive him. They put him in cells with no heat
    and no window panes in December in Moscow and he nearly froze
    to death. They put him in cells with no toilet, just a hole in
    the floor where the sewage would bubble up.
        After 6 months of this, he became ill, he lost 40 pounds,
    he developed pancreatitis and gall stones and he was prescribed
    to have an operation on the first of August, 2009. One week
    before the operation his jailers came to him with a Faustian
    bargain. They said if you sign the following confession saying
    you stole the $230 million and you testify against Bill
    Browder, me, then you can then have the medical attention you
    need. In spite of the unbearable physical pain, Sergei refused
    to sacrifice his integrity, and didn't sign the paper. As a
    result, they abruptly moved him to a prison called Butryka,
    which is known around Russia as being one of the toughest and
    most unpleasant prisons in Russia. And most significantly for
    Sergei, Butryka had no medical facilities whatsoever.
        And at Butryka his health completely broke down. He went
    into constant, agonizing, ear-piercing pain. He wrote 20
    different requests for medical attention. All of them were
    rejected by the authorities. And on the night of November 16th,
    2009, Sergei Magnitsky went into critical condition. Only then
    did they move him to a prison that had an emergency room, but
    instead of treating him they put him in an isolation cell,
    chained him to a bed and allowed eight riot guards with rubber
    batons to beat him for 1 hour and 18 minutes until he died. He
    was 37 years old.
        How do we know all this? We know it because Sergei did
    something very unusual, he documented it all in 450 complaints
    during his 358 days in detention. And as a result of that, we
    have the most well-documented, human rights abuse and
    extrajudicial killing case in the history of Russia.
        Now, this is a tragic case and a heartbreaking case for me
    and his family, and for anyone around him, but the reason why
    this is politically significant is not what they did to him.
    This happens all the time, it's the cover up that the
    government embarked on afterwards.
        The Russian Government on the day he died, said that he had
    died of natural causes. They said they weren't aware that he
    was ill. They've since exonerated all of the police officers,
    Interior Ministry officials, prosecutors and judges from any
    liability. Some of them have been promoted, some of them have
    been given state honors.
        To add insult to injury, instead of prosecuting anyone who
    tortured or killed him, they're now prosecuting Sergei himself.
    Two and a half years after his death, they're now prosecuting
    Sergei Magnitsky for the trumped up crimes that they arrested
    him for in the first ever posthumous prosecution in Russian
    history. Not even Stalin did that.
        It's clear that there's no possibility of justice in Russia
    for Sergei's case and many, many other cases like it, and as a
    result I've sought justice outside of Russia. There are 11
    Parliaments around the world that are now considering visa
    sanctions and asset freezes on the people who killed Magnitsky
    as well as other gross human rights abusers. And most
    significantly, this Congress is also considering the same
    thing.
        I would argue that in the absence of any possibility of
    justice in these cases that something needs to be done, and
    that's the thing that needs to be done. Thank you.
        [The prepared statement of Mr. Browder follows:]

                                  ----------

        Chairman Ros-Lehtinen. Thank you very much, sir. Thank you
    for that powerful testimony.
        Mr. Ambassador.

       STATEMENT OF THE HONORABLE STEVEN PIFER, DIRECTOR OF THE
       BROOKINGS ARMS CONTROL INITIATIVE, BROOKINGS INSTITUTION
                  (FORMER U.S. AMBASSADOR TO UKRAINE)

        Ambassador Pifer. Thank you, Madam Chairman, Representative
    Berman, distinguished members of the committee. Thank you for
    the opportunity to speak today. I have submitted a written
    statement for the record and will summarize it now.
        The committee is hearing about democratic regression and
    pervasive corruption in Russia, and troublesome aspects of
    Russian foreign relations. I would like to place this in the
    context of broader U.S. policy. The goal of Washington's policy
    toward Russia should be to cooperate and make progress on those
    issues where interests coincide, while protecting American
    positions and managing differences where interests diverge.
        The Obama administration's Reset Policy has, by any
    objective standard, improved the U.S.-Russia relationship since
    2008. The new START Treaty, expanded transit rights through
    Russia to Afghanistan, and Russian support for an arms embargo
    on Iran all advance U.S. interests. At the same time,
    Washington and Moscow disagree on a number of issues. The
    bilateral relationship will for the foreseeable future combine
    a mix of questions on which the countries agree, and questions
    on which they do not.
        On May 7, Vladimir Putin returned to the Russian
    Presidency. As you noted, Madam Chairman, Mr. Putin held the
    real power over the past 4 years; thus, his return should not
    entail a change in the strategic course of Russian foreign
    policy, though the tone may change.
        Mr. Putin will have to confront domestic political, and
    economic challenges that may affect his foreign policy choices.
    We will have to see what that means in practice. It remains in
    the U.S. interest to engage Russia to advance American policy
    goals. In doing so, the United States will at times have to be
    prepared to take account of Russian interests if it wishes to
    secure Moscow's help on issues that matter to Washington.
        Looking forward, the United States should pursue further
    reductions of nuclear arms including non-strategic nuclear
    weapons, continue to explore a cooperative NATO-Russia
    arrangement on missile defense, and seek jointly to deal with
    proliferation challenges posed by North Korea and Iran, areas
    in which Washington and Moscow have found common ground in the
    past.
        Washington should explore ways to increase trade and
    investment relations with Russia. While Moscow's decisions
    about its investment climate are the most important factor in
    this regard, Congress should now graduate Russia from the
    provisions of the Jackson-Vanik amendment. Russia long ago met
    the requirements by opening up freedom of emigration. Its
    continued application provides no leverage with Moscow, will
    hurt American business, does nothing for the opposition in
    Russia and degrades the value of the threat of Congressional
    sanctions in the future.
        Where interests diverge, the U.S. Government should make
    its case, encourage change in Russian policy and be prepared to
    manage differences that persist. Washington and Moscow, for
    example, disagree sharply over Syria where the Russian
    Government has misguidedly attached itself to an autocrat whose
    days may well be numbered. U.S. diplomacy should seek to
    persuade Moscow to adopt a different course.
        U.S. and Russian interests differ in the post-Soviet space,
    the region most likely to generate a major crisis in bilateral
    relations. Moscow seeks to gain inordinate influence over its
    neighbors, the United States rejects that notion of a sphere of
    influence and supports the right of each post-Soviet state to
    choose its own course. Some tension between these two
    approaches is inevitable. It would be wise for Washington and
    Moscow to consult closely and be transparent on their policies.
        One other difficult issue is the democracy and human rights
    situation in Russia. While Russian citizens today enjoy
    considerably more individual freedoms than they did during
    Soviet times, they have fewer freedoms, are more subject to
    arbitrary and capricious state action, and have less political
    influence than during the 1990s. This regression is sadly
    epitomized by the flaws in the recent parliamentary and
    Presidential elections, and the appalling treatment of Sergei
    Magnitsky.
        Democratic and human rights values are properly a part of
    U.S. foreign policy, and it is difficult to envisage a
    bilateral relationship with Russia becoming truly normal while
    these problems persist. U.S. officials should make clear
    American concerns publicly and privately with Russian
    officials. The U.S. Government should, as it is doing, maintain
    a policy of denying visas to Russian officials associated with
    the Magnitsky case. And this is a tool that should be
    considered in other egregious cases.
        Washington should examine other ways to support the growth
    of a robust civil society in Russia. U.S. officials should
    maintain contact with the full spectrum of Russian society, and
    Members of Congress themselves should engage directly with
    their counterparts in the Russian legislature on these
    questions.
        Washington should bear in mind, however, that its ability
    to affect internal change in Russia is limited at best.
    Hopefully, the opposition movement that is now emerging will
    strengthen and grow into a vehicle through which ordinary
    Russians can gain a greater say in their politics and
    governance. The United States can encourage this on the margins
    but this is an issue that the Russians themselves must drive.
        Madam Chairman, the U.S. Government should raise its
    democracy and human rights concerns and challenge Russia where
    positions on other interests diverge. At the same time, the
    United States should continue to work with Russia to advance
    American interests, and to build a more positive sustainable
    relationship. Doing so will increase American influence with
    and in Russia. Thank you.
        [The prepared statement of Ambassador Pifer follows:]

                                  ----------

        Chairman Ros-Lehtinen. Thank you very much.
        Dr. Aron.

      STATEMENT OF LEON ARON, PH.D., DIRECTOR OF RUSSIAN STUDIES,
                     AMERICAN ENTERPRISE INSTITUTE

        Mr. Aron. Thank you very much, Madam Chairman, Mr. Berman,
    distinguished members.
        Among the top, the very top priorities of U.S. Foreign
    Security policies, I doubt there are many, if any, objectives
    more important than a free democratic, stable, and prosperous
    Russia, peace at long last with its own people, its neighbors,
    and the world.
        Assisting the emergence of such a Russia is or should be
    among the top U.S. geostrategic goals to which shorter terms
    policy should be attuned and adjusted. Always a hard job
    requiring skill, patience, perseverance, and a great deal of
    expertise.
        Of late, this task has gotten even more complicated. On the
    one hand we have seen, and will continue to see without a doubt
    in the coming months and years a brilliant outburst of civic
    activity, a quest for democratic citizenship by the tens of
    thousands of Russians who demonstrated in the country's largest
    cities and by the millions who think like them. The civil
    rights movements will eventually crystallize politically, in
    effect another attempt at a democratic breakthrough following
    Russia's revolution of August '91.
        On the other hand, after effectively 12 years in power, the
    Russian President, turned Prime Minister, turned President has
    engineered an election from which he barred every leader of
    pro-democratic opposition and limited the exposure of the
    majority of the Russians who get their news mostly from
    television to what a leader of the protestors and one of
    Russia's most popular writers, Boris Akunin, called Shameless
    Propaganda of Vladimir Putin's candidacy.
        Fresh from the spectacular and well-documented
    falsification of the results of the previous election, the
    December 4th parliamentary election, the wholly-owned Kremlin
    subsidiary by the name of the Central Electoral Commission
    stood by to draw as they say in Russia whichever number the
    boss ordered.
        Among the many troubling aspects of this so-called
    Electoral Campaign was anti-American propaganda, the likes of
    which we may not have seen since before 1985. Troubling, but
    hardly surprising, just as all politics is local, so in the end
    much of foreign policy is domestic politics. And whenever
    domestic politics is dicey the Kremlin, like all other
    authoritarians resort to a tried and true tactic, alleged
    external danger to rally the people around the flag, to smear
    and marginalize pro-democracy opposition as agents of enemies
    from abroad.
        Putin's enemy of choice has always been the United States;
    hence, Secretary Clinton as a signaler to anti-Putin
    opposition. Hence, also, a number of policies that have already
    been mentioned so I'll only go through them very briefly.
        It's been almost 2 years since Russia has criticized--has
    supported U.S. and Europe sanctions against Iran. Of late, it
    deplored these sanctions, unilateral sanctions aimed at Iranian
    oil exports. This past November Russia condemned the
    International Atomic Energy report that provided further
    evidence of Iran's Nuclear Weapons Program.
        Moscow continues to sell arms to Bashaw al-Assad's
    murderous regime even as it butchers its own citizens as the
    world watches. Along with China, Russia has vetoed two Western
    and Arab League-backed U.N. Security Council sanctions,
    resolutions threatening sanctions against Damascus and calling
    for Assad to step down.
        The U.S. Ambassador to the United Nations, Susan Rice,
    called the February 4th veto outrageous and accused Moscow of
    standing with a dictator. Yet as late as March 13th, a senior
    Russian official confirmed that Moscow had no intention of
    rethinking its weapon sales and military cooperation with
    Syria.
        Finally, despite untold hours of briefings, including at
    the highest level of U.S. Government, to demonstrate that
    Moscow worries about the U.S. missile defense in Europe are
    totally unfounded, this past November on national television
    President Dimitri Medvedev reiterated an earlier threat to
    station short-range ballistic missiles in the Kaliningrad
    region, and even to withdraw from the New Start Strategic Arms
    Treaty if the U.S. proceeds with the missile defense
    deployment.
        So, what next for Russian foreign policy? Of course,
    nothing is certain in these types of predictions, but domestic
    politics may again provide some solid clues. The regime's post
    election strategy thus far has included a few concessions to
    the pro-democracy protestors such as the nominal return of the
    gubernatorial elections, and the recent registration of a
    Liberal Republican party of Russia. But a stronger and broader
    trend is clearly the one of authoritarian consolidation
    including selective persecution of some key leaders of the
    protestors, the reestablishment of the Kremlin's unchallenged
    control of television, and anti-American propaganda.
        If this strategy which reminds one of the title of Lenin's
    article ``One Step Forward, Two Steps Backward,'' continues to
    guide the Kremlin, then Russia is likely to maintain an
    assertive anti-U.S. posture in order to shore up its
    increasingly shaky legitimacy at home by lending as much
    credence as possible to the narrative of protecting the
    motherland against the scheming enemies of Russia on the
    outside and the fifth columnists from within. And as a result,
    occasional gestures such as goodwill toward the West and the
    United States, especially in the areas of deep security
    concerns for Russia such as Afghanistan, are going to be few
    and far between.
        I wish I had a more cheerful forecast for U.S.-Russian
    relations for the remainder of this year but the preponderance
    of evidence points to a chill with possible frost on the
    ground.
        Chairman Ros-Lehtinen. Thank you.
        [The prepared statement of Mr. Aron follows:]

                                  ----------

        Mr. Aron. Madam Chairman, I would like to enter into the
    record two articles dealing with the domestic roots of Russian
    foreign policy, one from 2008 titled----
        Chairman Ros-Lehtinen. Thank you. Without objection subject
    to the length limitation and the rules.
        Thank you so much, and thank you to all of our witnesses
    for excellent testimony.
        I will start the round of questions where each member will
    have 5 minutes to ask questions. I wanted to focus on the Assad
    regime in Syria, and wanted to ask you, you all discussed it,
    but why is Russia so aggressively supporting that regime? What
    benefit, what is the end game? How does Russia see this playing
    out to benefit the nation? What are we to make of reports that
    Moscow has sent elite troops, units of Russian Marines, special
    operations forces to Syria in order to conduct antiterrorism
    missions in the country, whatever those may be? And if you
    could comment on news that we've read lately that Russian
    experts upgraded the long range radar systems in Syria in order
    to help Iran with an early warning system in event of an attack
    on its nuclear facilities. And, also, as Russia appears to be
    actively supporting both Iran and Syria, would you agree that
    our efforts to gain Russian cooperation regarding these
    countries have been a true failure? We'll start with Mr.
    Kramer.
        Mr. Kramer. Madam Chair, I think these are like-minded
    regimes, and they come to the aid and protection of each other.
    I think Mr. Putin was scared when he saw what happened to Ben
    Ali, and Mubarak, and Qaddafi, and he doesn't want to see the
    same thing happen to Assad in Syria. These kinds of leaders
    need to stay together.
        Russia has not only vetoed the U.N. Security Council
    Resolution, as you and others have indicated, they are selling
    arms to the Syrian regime which the Syrian regime is in turn
    using to slaughter its own people. Russia has a base in Syria.
    Russia has continued to provide military support.
        I'm afraid this doesn't come as a surprise. When you have
    the kind of regime you have in Moscow, I think it tries to come
    to the aid and support of a regime like we see in Damascus.
        Chairman Ros-Lehtinen. Thank you. Mr. Browder.
        Mr. Browder. The Russian Government and the Russian State
    functions off the back of oil. That's the main fuel that fuels
    the economy. The Soviet Union ended when oil prices went down
    to $10 a barrel and Russia is flexing their muscles with oil at
    $120 a barrel.
        It's in their interest to have instability in the Middle
    East because it keeps oil prices high, and so Russia is not
    playing a game of--they're not playing sort of good world
    stewards when they're voting at the Security Council. They're
    making sure that they can spoil the situation so oil prices
    stay high. And I think that that's a very important part of
    their calculus.
        Chairman Ros-Lehtinen. Excellent point. Ambassador.
        Ambassador Pifer. I think Russian policy toward Mr. Assad
    has four reasons. First of all, they see him as an ally,
    unfortunately, and they don't have many allies left. They're
    reluctant to throw him over. A second part of this is payback
    to the West over Libya, where they believe that the West took a
    U.N. Security Council Resolution and stretched it in its action
    in Libya. Third, and I think this is a bit more legitimate
    reason, is they don't know what comes after Mr. Assad. And I
    think that is a legitimate concern.
        Finally, there is a rather paranoid view here, which is if
    you look at how the Russians talk about Syria it fits into a
    pattern of how they talked about the revolutions in Georgia,
    Ukraine, Tunisia, Egypt, that these aren't indigenous
    movements, that they're somehow directed, funded by the United
    States, and that they're somehow directed against Russia. And
    it seems very paranoiac, but when you look at what they say in
    Moscow, they say it so many times that you think they really
    must believe it.
        I think the Russian policy is wrong. It's also misguided
    and self-defeating. It's going to position them badly with the
    Arab world, and if and when Mr. Assad goes down it will
    position Russia badly with his successors.
        Chairman Ros-Lehtinen. Thank you. Dr. Aron.
        Mr. Aron. Very little to add to what's been said by my
    colleagues. I think it's one of the clearest cases of the uses
    of foreign policy for domestic politics. I think Vladimir Putin
    feels that the support for these types of regimes, and not so
    much specific support for specific regimes but opposing the
    U.S. and the West in the areas of not just strategic but moral
    concern is somehow bolstering his domestic political standing.
        Chairman Ros-Lehtinen. Thank you very much. Excellent
    answers. Thank you.
        Mr. Berman is recognized.
        Mr. Berman. Thank you very much. Hopefully, a quick
    response. Does the future of the Reset impact at all about
    whether Medvedev is made Prime Minister or not, or is that sort
    of irrelevant to the future of U.S.-Russia relations?
        Mr. Kramer. Mr. Berman, I would say it's irrelevant whether
    Medvedev becomes Prime Minister or not, and I don't think the
    Reset will have any bearing on that.
        Ambassador Pifer. I would second that. I think that Mr.
    Medvedev will become Prime Minister. I think Mr. Putin will
    make that appointment. How long he remains in the position will
    depend on his success at grappling with the very difficult
    economic challenges that Russia faces, but I think that really
    is not related to the Reset question.
        Mr. Aron. I think Putin has completely destroyed Medvedev
    as a political figure on the 24th of September when speaking to
    the United Party, United Russia Party. He put his arm around
    him and essentially said I had this boy warming up the seat for
    4 years. And, in fact, when the protestors were polled, both by
    the survey firms but also anecdotally that moment to many of
    them was one of the most shameless moments in Russian political
    history, and propelled them to protest 2 months later.
        Mr. Berman. Thank you. I want to get to the Magnitsky
    issue. And, Mr. Browder, I mean, I've read about this a lot,
    but your testimony was--put it all together in its most graphic
    sense.
        We have done a lot of--with respect to Iran, but now with
    respect to Syria, other places, we have country-specific
    designations of where we ask the State Department to name human
    rights abusers either generally, I'm not sure before in a
    specific case but maybe, and asset freezes. Does it makes sense
    to do this in a more general sense rather than specifically as
    to Russia, specifically about Magnitsky, to essentially set a
    process where we expect the appropriate agencies in the State
    Department to compile lists of human rights abusers in cases
    that we learn about where they're denied visas and where assets
    are frozen, or is doing it this way, specifically about Russia,
    specifically about this case, the preferred way to go, or
    should we be moving ahead on graduating and put this aside for
    now?
        Mr. Browder. The answer is that this initiative, asset
    freezes and visa sanctions, is not just specifically for
    Magnitsky. It started out specifically for Magnitsky in the
    U.S. House of Representatives when I first testified in front
    of the Lantos Human Rights Commission, and it was then put into
    the Senate as well, just on Magnitsky. And what happened was
    that many, many other victims of human rights abuse in Russia
    came forward and said this is the most powerful tool that we've
    ever seen to challenge the impunity that's been washing over
    our country. And as a result, the decision was made by Senator
    Cardin, McCain, Lieberman and Wicker to broaden the
    legislation, not just for Magnitsky, but for all gross human
    rights----
        Mr. Berman. But still Russia-specific.
        Mr. Browder. Well, it doesn't say so in the legislation.
        Mr. Berman. Oh.
        Mr. Browder. I believe just--and this is my personal
    belief, that we found the new technology for fighting impunity
    in the rest of the world. Many, many of these crimes are done
    for money, and these people like to spend their money and
    travel, and enjoy the fruits and freedoms of the West. And when
    they can't, that touches them in the most profound way.
        Mr. Berman. Anybody else have a 30-second thought on this?
        Mr. Kramer. Mr. Berman, if I could, I actually support
    graduating Russia from Jackson-Vanik, but I would argue only as
    a package with the passage of the Magnitsky bill. I think it
    would be a major mistake to grant Russia graduation without
    bringing up to speed legislation that deals with current day
    Russia's problems, and I think that's exactly what the
    Magnitsky case does, or the Magnitsky legislation.
        If I could, also, there are two--there's been a lot of
    confusion about the position of opposition leaders when they
    issued a statement about a week ago in support of lifting
    Jackson-Vanik for Russia. There are two articles, if I may,
    Madam Chair, suggest entering into the record by Gary----
        Chairman Ros-Lehtinen. Without objection subject to the
    length.
        Mr. Kramer [continuing]. Both advocating very strongly for
    Magnitsky replacing Jackson-Vanik.
        Mr. Aron. I think the Russian--the people who put their
    bodies on the line protesting in Russia know better, and they
    all while supporting, definitely supporting pulling of the
    Jackson-Vanik, and have also advocated very strongly some sort
    of legislation that both will show a moral concern by the
    United States about the human rights abuses both in Russia and
    the world, but also target specific individuals whom Russian
    justice system simply is not capable of punishing.
        Ambassador Pifer. I would just add that I think that visa
    and financial sanctions have proven effective in the past. Dave
    and I worked on these years ago, for example, with regards to
    Belarus, and I think that they have had an impact.
        That said, I would urge that if the route is chosen as a
    piece of legislation that Congress write the legislation so
    that the sanctions are lifted, in fact, when the behavior is
    adjusted in the way that you wish. I think that's been one of
    the drawbacks of the Jackson-Vanik provision and its
    application to Russia, is 15 years after Russia met the
    requirements it still remains under that sanction.
        Chairman Ros-Lehtinen. Thank you very much. Mr. Smith is
    recognized.
        Mr. Smith. Thank you very much. Let me just--Secretary
    Kramer, you point out that since his laudable speech in July of
    '09 in Moscow in which he spoke about Russia's shortcomings in
    the area of human rights, Obama has been virtually silent on
    Russia's deteriorating political situation. Very strong
    criticism, and unfortunately in a whole host of human rights
    abuses around the world, including China; the President has
    been unbelievably silent when it has to come to human rights
    abuses.
        My question, I'd like to delve into the Magnitsky case. You
    know, the administration as best as I can tell, does not just
    believe that the legislation is unnecessary, but as you pointed
    out, they're against it. As you know, the information that was
    leaked, or however it became known, in their analysis makes it
    very clear that the administration believes that the
    Immigration and Nationality Act already bars admission to the
    U.S. of aliens who have engaged in torture, in extrajudicial
    killings.
        Back in 2000, I was the author of the Admiral Nance and Meg
    Donovan Foreign Relations Act of 2000, and we had a specific
    provision in there dealing with making inadmissible, in other
    words, visa bans on those people who engage in a number of
    human rights abuses, including forced abortion in China.
        The problem has been when it's not country-specific nobody
    gets banned, or very few people get banned. For example, under
    the Admiral Nance and Meg Donovan Foreign Relations Act there
    was nobody under the Bush administration coming out of China or
    under the Obama administration who has been told, ``Uh-uh,
    you're not coming here.'' And I've raised that I have a new
    bill in H.R. 2121 that is specifically focused on China because
    as we did with the Belarus Democracy Act. If you don't have
    specific country named, it seems that the administration is
    less enthusiastic about doing what they ought to be doing.
        Now, the administration claims that they have denied visas
    to some people involved in the Magnitsky case. It's unclear how
    durable that is, how expansive it is. But as, Mr. Browder, you
    pointed out, his case has become the most well-documented and
    emblematic case of torture, heavily documented by himself as he
    was going through it.
        So, my question really comes down to the administration. Is
    it your view that they're against it as this leaked document
    would clearly suggest? They talked about fears of retaliation,
    they talked about ambiguous language with regards to the asset
    side of it. It seems to me that's why you put this into place
    so that we'll do our due diligence to ascertain whose assets
    ought to be frozen, as well as who ought to be barred entry
    into the United States.
        So, again, it's like ``Magnitsky Light'' in terms of the
    legislation being supported by the administration which is not
    enough at all. I would hope, as you pointed out, that if the
    MFN were to go forward or the waiving and ending of Jackson-
    Vanik, this needs to be part of a package because otherwise,
    unfortunately, we will miss a significant opportunity. We
    didn't do it with China. They got PNTR and they got ascension
    into WTO with no linkage whatsoever to human rights. We created
    the China Commission, and I chair it, but I voted against the
    legislation, frankly, because China is the most, as Mr.
    Rohrabacher said yesterday, the most egregious violator of
    human rights globally. Nothing got better when the trade began
    to become unfettered.
        So, your thoughts further because, again, this document,
    are they against it, as far as you know, the administration?
    Will they veto the legislation, maybe kill it before it ever
    comes out in the Senate or in the House?
        Mr. Kramer. Mr. Smith, first of all, let me express my
    thanks to you for your leadership on human rights issues. When
    I was in the government, your championing of the Belarus
    Democracy Act was invaluable to our efforts to go after people
    in the Lukashenko regime. As Steve Pifer mentioned, both of us
    were involved in that.
        This kind of legislation I think is critical. It is very
    important to go after Russians. And the thing about this is
    that it is very targeted. It doesn't go after the entire
    country. It goes after Russian officials who engage in gross
    human rights abuses, who kill journalists, or lawyers, or human
    rights activists. And if they don't do that kind of thing, they
    won't be on the list.
        And it's also very important, I would argue, not only to
    put them on a visa ban list, but to go after their assets. As I
    mentioned with the capital flight, there was $84 billion in
    capital flight last year. Russian officials don't put their
    ill-gotten gains in Russian banks, they know it's not safe and
    secure. They put them in Western banks, so by going after these
    assets it's critically important.
        You're absolutely right, when China was granted PNTR, the
    China human rights situation did not improve, so graduating
    Russia from Jackson-Vanik won't improve the human rights
    situation.
        Mr. Smith. Is the administration against it?
        Mr. Kramer. My impression is the administration is, based
    on what Ambassador Mike McFaul said last week in several
    different meetings. I had been under the impression the
    administration was moving toward a deal, but McFaul's comments
    last week suggested that they, in fact, were not.
        Chairman Ros-Lehtinen. Thank you very much. Thank you, Mr.
    Smith. Mr. Meeks is recognized.
        Mr. Meeks. Thank you, Madam Chairman.
        You know, for about 20 years, and I'm listening, it's a
    very good hearing. Russia has sought entry into the WTO, and
    for just as long a period of time the United States has
    prioritized Russia's admission to the WTO. So, the first reason
    you ask yourself is why? Just because want to be--no, I think
    it's because the WTO membership required that Russia reform
    some of its law and its legal systems, and reform Russian trade
    policy and practices, and strengthen Russia's Rule of Law. That
    was some leverage that we had to get them to the WTO. And at
    the end of this 20-year path, you know, we see some laws and
    rules that Russia would have to abide by by being in a body
    such as the WTO.
        Now, by granting PNTR I don't think that we in no way can
    endorse or take in, or agree to allow human rights violations,
    and objections, and some of the objectionable, and even some of
    the despicable foreign policies or acts, what is happening on
    the ground in Russia.
        Though, it is by recognizing and taking advantage of an
    improved law in a business climate that we look at one end
    deepening our economic trade the relationship allows because I
    always say that there are two forms of relationships that a
    country has, one is trade, the other is war. I don't like the
    scenario we had going back to the Cold War where we're at one
    another and we're looking at one another, and threatening one
    another, no need in going there. I don't want that--we can
    improve trade relations, then that gives us opportunities to
    move forward.
        However, understanding the struggles that we've had within
    our own country, I admire the people of Russia, especially
    those who are standing up for their civil rights, especially
    those that are standing in the streets, especially those who
    are willing to lose their lives as people stood up in this
    country. And we should stand by them, and we should make sure
    that they are strengthened. But there are two tracks that we're
    taking here from what I see. And I don't want to cut off our
    nose to spite our faces.
        And when I hear people talking about PNTR, that's going to
    hurt. Well, maybe that's the question I'll ask. If denying
    Russia PNTR, is that going to hurt Russia? Because the facts
    that I'm getting in, it's not going to hurt Russia. It's not
    something that makes them change. It'll make us, or put us at a
    competitive disadvantage with our other competitors around the
    world because we're now in a global economy.
        So, I'll start with Mr. Pifer, does that--since Russia will
    be in the WTO this summer, is not granting PNTR, would that
    hurt Russia?
        Ambassador Pifer. Well, first of all, let me say that I
    think getting Russia into the World Trade Organization is an
    American interest because that will force Russia to play by
    trade rules to which most American companies are accustomed. It
    will improve the trade environment there.
        Second, if the United States does not grant Russia
    Permanent Normal Trade Relations status after Russia is in the
    WTO, that will mean that American companies will not be able to
    take advantage of certain WTO trade benefits, or WTO dispute
    resolution mechanisms. So, it'll be the Boeings, the John
    Deeres, it will be American companies that are then sanctioned,
    in effect, because they will not have the full benefits of WTO.
        But having said that, there's no reason why you can't move
    to graduate Russia from Jackson-Vanik, and still take other
    measures to make clear American concerns about human rights
    issues within Russia. I mean, we ought to be able to walk and
    chew gum at the same time and do both. It's not--and it should
    not be--an either/or situation.
        Mr. Meeks. Dr. Aron.
        Mr. Aron. Well, you know, I was really very pleased to hear
    you, and I think these are very related issues, to talk about
    the protest in Russia, civil rights movement. You and I--I've
    written about this. The similarities are incredible. You know,
    look at their slogans, don't lie to us, don't steal from us,
    listen to us, don't step on us.
        Mr. Meeks. Absolutely.
        Mr. Aron. They are against effective disenfranchisement,
    and they are for the equality before law. I think it's
    extremely important for all of us to understand that while you
    can call them political opposition, they're more like civil
    rights movements.
        Mr. Meeks. Absolutely.
        Mr. Aron. And that is both good news for the regime and bad
    news. It's good news because they're not crystallizing
    politically, they're not--you know, you can't really--they have
    trouble developing national leaders, developing a political
    agenda, but the very bad news for the regime, and the good news
    for the world and the people of Russia is that they're deeply
    morally committed. This is a movement for moral renewal.
        Mr. Meeks. Which means the fight will never stop until they
    win.
        Mr. Aron. It's very----
        Chairman Ros-Lehtinen. The fight may stop, but the 5
    minutes brings this to an end.
        Mr. Meeks. Okay.
        Chairman Ros-Lehtinen. Thank you so much. Mr. Dana
    Rohrabacher.
        Mr. Rohrabacher. Thank you very much, Madam Chairman. And,
    again, I think my commitment to human rights is very evident
    and I would, of course, support legislation that would hold
    human rights abusers in Russia or anywhere else, specifically
    aimed at Russia or other countries, I'd be very happy to
    support that.
        But in saying that, I'm really appalled at the double
    standard that we use toward Russia. I mean, Chris mentioned it
    just in passing. I mean, there are no opposition rallies in
    China. There are no opposition parties. There's no newspapers
    that criticize the government. We have people who are being
    arrested for their religion and having their organs--murdered
    and having their organs taken out and sold, and we're not even
    taking that problem seriously. I mean, the double standard is
    incredible to me. And even the double standard we have to our
    own system.
        Look, there's lots of shortcomings that Russia has, and we
    should be pushing them on them, no doubt about it. But let's
    not use the most sinister words that we can possibly think up
    to describe things that are not quite that sinister, that if we
    use the same standard on us would seem sinister.
        How many people died in Waco? How many innocent citizens
    were incinerated, kids in Waco? Well, I want to tell you
    something, that can be described in very sinister terms. The
    guy who shot the woman who was holding her child at Ruby Ridge
    was given a promotion by the Clinton administration, as was the
    person who gave the orders to burn down those families in Waco.
        Now, does that mean that our system is very sinister,
    there's a sinister part of America--no, that means that people
    make mistakes, and we've got to make sure we hold them
    accountable for it. And we've got to expose it.
        Now, let me ask this, with all the talk I've heard so far,
    of these rallies, of which we can proud that Russia now has
    rallies against Putin, how many of their leaders have been
    picked up by the Putin administration and jailed. How many are
    in jail right now for those rallies that we've just seen on
    television these last few months? Are there any?
        Mr. Aron. They are harassed.
        Mr. Rohrabacher. Harassed.
        Mr. Aron. No, no, no. And you're absolutely right about
    double standards with regard to China. And the answer to this
    is, first of all, life is not fair. And, secondly, I've been
    thinking a lot about this. You know, we did not spend untold
    amount of Treasury opposing China for 50 years in the Cold War.
        Mr. Rohrabacher. Okay, well, I've got to--listen, my time
    is going to be used up on China, and we're talking about Russia
    today. And I don't think Russia is being dealt a fair hand.
    Because I will tell you, Putin is not a good guy, we all know
    that. He has a background that would lead him to decisions and
    to an arrogance that we would not accept here. I mean, I think
    the self-inflicted wound of having to run again is going to
    hurt Russia. And I'm sorry they made that decision, but let's
    go back to number one, the level of repression in Russia.
        I have asked over and over again, Madam Chairman, for lists
    of names of people who are political prisoners in Russia, and
    when I get the list almost all of them deal, and all of the
    journalists that have been repressed, almost all deal with the
    Chechnyan War. And let me just note that we have our own
    situation now where the police chiefs of New York City--oh,
    there must be massive repression against the Islamic community
    in New York because after 9/11 they started surveilling the
    Muslim community in New York.
        Well, in Russia there was a school where they blew up a
    whole bunch of kids, the Chechnyans did, they went into a
    theater, they have been conducting terrorist activity in and on
    Russians.
        Now, yes, that leads people to overreact at times, but
    almost all of the political prisoners, Madam Chairman, where
    I've asked to get the list from and all the sinister discussion
    of all the political prisoners that they have now, and the
    journalists who have been assassinated, almost all of it is
    traced to this war with radical Islam, and especially the
    Chechnyan War.
        Now, I don't think that is fair for the American people not
    to know. I think it's okay to say okay, they got political
    prisoners as a result of this war with radical Islam, but
    American people are given the assumption that the political
    prisoners are all just democratic reformers who are out
    protesting against Putin. That's not a fair comparison.
        Look, I want to--again, let's hold the Russians who are
    involved with human rights violations, hold them personally
    accountable, but let's not create a false image here that
    creates a--we should be best friends with Russia in dealing
    with the China threat and the radical Islamic threat. That's
    what's on both of us. Instead, we're pushing them away, and
    pushing them into the arms of China.
        Chairman Ros-Lehtinen. Thank you, Mr. Rohrabacher. Mr.
    Connolly. Thank you, Mr. Connolly is recognized.
        Mr. Connolly. Thank you, Madam Chairman. Well, gosh, I
    certainly take a point from our friend from California, but we
    just had some of the most powerful testimony this committee has
    ever heard about a political prisoner who was not from
    Chechnya. He had the gall to actually try to practice law and
    represent a defendant falsely accused on trumped up charges to
    cover up massive corruption. And that is not an anomaly in
    Russian jurisprudence sadly.
        So, right here in this hearing we actually have an example,
    Mr. Rohrabacher of exactly what you're saying, give me proof.
    And it isn't just an example, it is a horrific example of the
    worst kind of totalitarian justice, frankly, and it needs to be
    singled out and condemned----
        Mr. Rohrabacher. Would the gentleman yield for just one
    moment?
        Mr. Connolly. Yes, sir.
        Mr. Rohrabacher. I'd like to be on the record to make sure
    I am appalled at that type of activity, and just don't let
    anybody think by my remarks that I in any way excuse that type
    of thing. So, thank you.
        Mr. Connolly. I thank the gentleman. But let me go to the
    Ambassador. Ambassador, you said in your testimony, and I know
    you weren't suggesting therefore do nothing, but you said,
    frankly, our ability to influence practice within--domestically
    within Russia is limited. And I think back to the Cold War era
    which, sadly, I'm old enough to remember vividly.
        We did, we adopted Vanik-Jackson, Jackson-Vanik. We
    supported refuseniks. We singled out Sharansky and some other
    high profile dissidents and by doing so protected them from
    what Mr. Browder described tragically that happened to Mr.
    Magnitsky, so we were able under the Communist era to somewhat
    influence behavior. We can't be delusional about how much,
    but--and maybe it had counterproductive impacts, as well. I
    don't know, but how do we solve this balance, though, between
    the moralistic instincts of U.S. foreign policy that have
    always been with us in the bounding of the Republic, and the
    politics of Realpolitik where we have to pursue our own self-
    interest economically, and politically, and geopolitically. And
    maybe what we should do is just turn a blind eye to all that
    stuff, unpleasant though it is.
        What's the balance in Russia? And I wanted to give you an
    opportunity to sort of expand a little bit on that so we don't
    misconstrue what you meant.
        Ambassador Pifer. No, I think your question is a very good
    one. And it's one of the challenges that this administration
    has faced, and really every administration for the last 30 or
    40 years has faced with the Soviet Union, or Russia, is how do
    you strike that balance between on the one hand engaging on
    issues where you can work with the Soviet Union or Russia to
    advance interests, while also being clear about problems that
    you have on the human rights side.
        I think if you go back, for example, to the Reagan
    administration, during the Reagan administration there was a
    four-part agenda: Arms control, regional issues, bilateral
    questions, and human rights. And I think the experience of
    those 8 years was that as you made progress on some of the
    positive issues it, in fact, increased your ability to have
    impact on human rights questions.
        I served at the Embassy in Moscow from 1986 to 1988 during
    the Reagan administration's second term, and at that point we
    saw progress, in fact, increasing our ability to push and help
    make change on the human rights side, and you were seeing a
    good number of refuseniks beginning to get out and such. So,
    this is one of the challenges is, in fact, finding a
    relationship where if you can work to find interests which
    coincide and you can broaden that relationship that, in fact,
    may give you a greater ability to affect the Russians'
    decisions on questions like human rights where we have real
    problems.
        Mr. Connolly. And I understood from your testimony, too, we
    can't frame this as an either/or. Either we pursue our self-
    interest very callously and turn a blind eye to all this human
    rights stuff, or we pursue this high moral ground at the
    expense of our self-interest. That's a false choice.
        Mr. Aron. Exactly.
        Ambassador Pifer. That would certainly be an easier way to
    do the policy, but it's the wrong policy for the United States.
        Mr. Connolly. Mr. Kramer, thank you. Very little time here,
    but you gave pretty blunt assessment of Russia and its
    governance. What is your prescription for U.S. foreign policy
    given the characterization you made of the Russian leadership?
        Mr. Kramer. Mr. Connolly, when I was in the Bush
    administration, we tried to pursue areas of common interest
    with Russia while also pushing back wherever we had
    differences. I would argue that policy should remain the same.
    I think the current approach has been with much more emphasis
    on pursuing common interest, and not on the push back. I would
    apply that not only to the area of human rights and democracy
    problems in Russia, but also toward Russia's neighbors.
        If I can, I know we're out of time, but I'm sorry Mr.
    Rohrabacher left. I do worry----
        Mr. Connolly. This is going to cost me chocolate.
        Chairman Ros-Lehtinen. Don't bring him back, come on. Have
    pity on us.
        Mr. Kramer. Madam Chair, I do worry that there was a
    demonization of Chechens in the comments that he made. In 1994
    to 1996 when Russia invaded Chechnya, there were tens of
    thousands of Chechens slaughtered. In 1999 when the war resumed
    with Chechnya, there were tens of thousands of Chechens
    slaughtered again. This is how Putin came to power. It is
    impossible to separate the problem in the North Caucasus. It is
    impossible to separate the issue of Chechnya from Putin's
    current position. This is how he came to power.
        So, while, of course, the Magnitsky case is not related to
    Chechnya, what happened in Chechnya is appalling, and the
    current leader of Chechnya is one of the worst human rights
    abusers in the country, if not in the world.
        Chairman Ros-Lehtinen. Thank you, Mr. Connolly, and thank
    you, Mr. Faleomavaega.
        Mr. Faleomavaega. Thank you, Madam Chair. My apologies,
    terrible schedule today of having to have two committee
    hearings at the same time. But I do want to thank you for
    calling this important hearing on Russia, and my apologies to
    our expert witnesses here this morning that I wasn't here to
    listen to their testimonies. But just a couple of questions, I
    would appreciate from our witnesses.
        Correct me if I'm wrong, but it's my understanding that we
    spent well over $5 trillion to win the Cold War against the
    former Soviet Union. And correct me if I'm wrong again, it
    appears that we were not anticipating that this would happen to
    the Soviet Union's downfall. And my question is with all the
    spying, and the intelligence, and things that we've done for
    the 40-year period during the Cold War, why is it that our
    national leaders never realized that something was going wrong,
    that the Soviet Union would just collapse. Can anybody--maybe
    I'm wrong. Can anybody tell me--we're pretty good at keeping
    eyes on the atomic weapons, their missiles, and all the
    military might, but we couldn't even predict the fact that they
    would fall. Am I wrong in this? I would appreciate the witness'
    response to this.
        Ambassador Pifer. Congressman, I have to admit guilt. I
    served at Embassy Moscow from 1986 to 1988 and we did not see
    at the end of 1988 that the Soviet Union would not be in
    existence 3 years later.
        Mr. Berman. Would the gentleman yield?
        Mr. Faleomavaega. I gladly yield.
        Mr. Berman. There's one exception to what the gentleman
    said. I heard Daniel Monynihan give a speech in January 1985
    where he predicted--he was a little wrong because he predicted
    by the end of the century the Soviet empire would disintegrate
    because of its own failings.
        Ambassador Pifer. I think there was one American analyst,
    George Kolt, who made the prediction but he was very much of a
    minority view at the time.
        Mr. Berman. Imagine a politician making it.
        Mr. Aron. If I may, this is very gratifying to me because
    in the new book that Madam Chairman so kindly mentioned
    published by Yale this June, the first chapter is precisely
    dealing with the issues of why nobody could predict it.
        Chairman Ros-Lehtinen. Out this spring.
        Mr. Aron. And the reason for this, very briefly, is that we
    looked in the wrong places. We're all trained to look at the
    economy, military, security, we never look at the morality. And
    this regime, like all authoritarian regimes, like Arab Spring,
    like any other fall of authoritarian regime, ultimately starts,
    the spark is moral revolution. And I think this is what
    Gorbachev's glasnost did. And that nobody could predict.
        Mr. Faleomavaega. I think my colleague from California
    mentioned about the good Senator Monynihan from New York, but
    just one leader in our Government was able to make the
    prediction? That amazes me. With all the Rand Corporations, and
    all the experts and everything that we have in our capacity to
    look at--especially as the only other super power, it was our
    rival, and we were not able to see this coming. Because the
    next thing that leads to my next question, this was basically a
    socialist-Marxist society as a country, and their idea of a
    free enterprise, free marketing system unlike the Chinese,
    there's about $300 billion worth of assets that Chinese
    business people had outside of China which enabled China, in my
    humble opinion, why the economy is able to do it, because
    you've got multi--hundreds of billions of dollars of Chinese
    investors that go into it from Taiwan. You know, maybe they all
    don't realize Taiwan and China, even before the better
    relations they now have, they were having 100-billion trade
    relationship, unofficial they call it.
        My question that I wanted to raise on this is that did it
    seem that--and it didn't matter what administration, we
    failed--our Government failed to give the Soviet Union or
    Russia the necessary resources to bring itself back to regain
    its sense of stability, if you will. Am I wrong on this,
    because I seem to get that--whether Democrat or Republic
    administration, in my opinion we failed to give Russia the
    necessary resources to regain itself in terms of what happened
    when they tried to work in a Democratic system. They tried to
    work getting to the free market system, but it seems that our
    Government just didn't seem to give them the resources. Dr.
    Aron, am I wrong on this assessment?
        Mr. Aron. It's very complicated. Let me just remind you
    that Russia is making $900 million a month from the sale of
    oil. I think the resources it not exactly the issue. I think
    it's inability of the Russian civil society to mature and to
    watch over executive, which is why the current protests are so
    hopeful because that may be a sign of an evolving civil
    society, which is our best hope.
        Mr. Faleomavaega. I've got 50 more questions, but I've got
    my 20 seconds left. Madam Chair, I will have written questions.
    I just wanted to ask if the Obama administration made the right
    decision not to hold a missile defense system built in Poland,
    the Czech Republic years ago. But my time is up, I'm sorry.
        Chairman Ros-Lehtinen. Maybe we have time for a yes or no.
        Mr. Kramer. They handled it the wrong way, but their
    current system is not a bad one.
        Mr. Faleomavaega. All right, thank you. Thank you, Madam
    Chair.
        Chairman Ros-Lehtinen. Thank you so much. Mr. Sherman is
    recognized for 5 minutes.
        Mr. Sherman. Thank you, doctor, and I think you've hit on
    something, and that is you need a unifying ideology to keep an
    elite, and an entire society together, an agreement as to who
    should rule, that can be theocracy, the Division Right of
    Kings, Communism when you believe it as a religion, or
    something very close, democracy has a lot of appeal. And I
    would comment that the ideology that gives the Communist party
    of China the right to rule is we're a bunch of--we're a
    Communist party that no longer believes in Communism. This is
    not an ideology or a morality, if you will, that's going to
    hold water. Their second reason is we bring you 7 percent
    growth, and as long as they do they won't have an ideological
    problem. But I doubt very much whether there's an ideology that
    will help that government survive bad economic times.
        My first question is to the entire panel. There's a tension
    in foreign affairs between self-determination on the one hand,
    and territorial integrity on the other, the two great wars
    fought on American soil, one in 1776 was our war for self-
    determination, and in 1861 began our war for territorial
    integrity.
        Now, we took the side of self-determination vis-a-vis the
    individual republics of the Soviet Union, the republics of
    Yugoslavia, and the Serbian region of Kosovo. We took the side
    of territorial integrity with regard to Abkhazia, South
    Ossetia, Trans-Dniester Moldova, the Krajina region of Croatia,
    and the northern parts of Kosovo that wanted to break off from
    the newly independent Kosovo. Is there any consistent them in
    all that? Does anybody have a theme?
        Ambassador Pifer. I'm not going to argue that the policy
    was always consistent. I think with regard to the specific case
    of the breakup of the Soviet Union, the decision was to
    recognize the states that emerged in their territorial
    boundaries at that point, because redrawing one of those
    borders would open up a can of worms.
        Mr. Sherman. I would say there is a consistent theme, and I
    agree, the individual decisions can be justified. But in I
    believe it's like 15 different cases or close to that, we took
    the anti-Russia position whenever we had to decide between
    territorial integrity and self-determination. The Krajina
    region of Croatia had to stay with Croatia because the Serbs
    there wanted independence. Northern Kosovo could not rejoin
    Serbia, et cetera, et cetera.
        I realize that--so whether it was--I mean, Kosovo was never
    an independent republic, and yet we--and for very good
    individual reasons. But when you lay out a whole plan like
    this, it seems like the reflex from the Cold War of taking the
    anti-Russian position is also a theme underlying our individual
    decisions. Dr. Aron.
        Mr. Aron. Just to remind you of one exception to your rule,
    and perhaps the one that mattered the most to Russia.
        Mr. Sherman. Chechnya.
        Mr. Aron. Chechnya, yes.
        Mr. Sherman. Yes. No rule is any good without one
    exception.
        One thing that's important at least to a lot of Americans
    are the Schneerson Collection of papers. I don't know if any of
    you are familiar with those. We returned the Smolensk Library
    to Russia. Do any of you have any ideas as to why the Russians
    are so stubborn on these papers and/or what we could do to
    change their minds? Dr. Aron?
        Mr. Aron. Well, it's the inability to come to terms with
    the crimes of Stalinism, of which by the way the Smolensk
    Archive is one of the key evidences. It's all written, it's all
    there. It's the archive of the Obkom which is the regional
    party committee detailing all sorts of----
        Mr. Sherman. Are you saying that our return of the Smolensk
    Archives was somehow harmful to Russian interests?
        Mr. Aron. No, no, no, no, no. What I'm saying is in the
    case--no, it's a good thing that we returned them. It's just
    the uses that Russia refuses to make of its past is continuing
    to poison the situation in the country. Katyn Massacre----
        Mr. Sherman. A few religious documents cannot be released?
        Mr. Aron. No, no, no, they're not religious documents.
        Mr. Sherman. The papers of the Chabad Rebbe?
        Mr. Aron. Oh, I see, I see. Sorry.
        Mr. Sherman. Yes, sorry, wrong answer.
        Mr. Aron. There is a----
        Mr. Sherman. Doctor, perhaps--does somebody have a comment
    on the papers I was talking about?
        Mr. Aron. Right, okay, sorry, I take it back.
        Mr. Sherman. Great answer, but not to my question. Anyone
    have a comment? Thank you. I yield back.
        Chairman Ros-Lehtinen. Thank you very much, and I thank the
    members, I thank the audience, I thank the panelists. And the
    trial starts Saturday.
        Mr. Browder. The rally scheduled for Sergei Magnitsky was--
    the first rally that they have rejected, they're not allowed
    the rally for Sergei Magnitsky on Saturday, and they're going
    to be starting the trial imminently, we don't know when, again
    Sergei and against myself. Sergei dead, me in absentia in the
    first ever posthumous trial in Russian history.
        Chairman Ros-Lehtinen. Amazing. Well, thank you very much.
    Thank you for excellent testimony, and the meeting is
    adjourned. Much success.
        [Whereupon, at 12:18 p.m., the committee was adjourned.]

                                A P P E N D I X

                                  ----------

         Material Submitted for the Hearing RecordNotice deg.

    Material submitted for the record by the Honorable Gregory W. Meeks, a
             Representative in Congress from the State of New York

      Material submitted for the record by the Honorable David J. Kramer,
                            President, Freedom House

      Material submitted for the record by Leon Aron, Ph.D., director of
                 Russian studies, American Enterprise Institute

    [Note: The remainder of this article is not reprinted here but is
    available in committee records.]