ABSTRACT
Russia's economic crisis, like that which swept across Thailand, South Korea, and other Asian states in 1998, has its roots in the failure of political institutions, even before economic or financial ones. With regard to the International Monetary Fund (IMF), the principal lending institution both directing and financing most of Russia's economic reforms, the policy prescriptions proposed to the Russian government differed little from those offered to other countries grappling with de-statization issues. Like large, cumbersome bureaucracies everywhere, donor institutions are slow to embark on complicated strategies, and arguably slower still to adapt to lessons learned through corrective strategic responses. USAID was one of the first donors to recognize the importance of judicial independence as a political goal for the new Russian state. Russians themselves, rather than Western organizations, must take the lead in articulating new incentive structures that focus on long-term investment in Russia's collapsed infrastructure.
