Palms & Company Document

courtesy of

Dr. Pyotr Johannevich van de Waal-Palms

Promoting Democracy: Progress Report on U.S. Democratic Development
Assistance to Russia (Letter Report, 02/29/96, GAO/NSIAD-96-40).

Pursuant to a congressional request, GAO reviewed U.S.-funded democracy
programs in Russia, focusing on whether these projects met their
developmental goals and contributed to political reform during fiscal
years 1990 through 1994.

GAO found that: (1) U.S.-funded democracy projects have increased the
quality and self-sufficiency of Russia's democracy movement by assisting
prodemocracy political activists and parties, proreform trade unions,
court systems, legal academies, government officials, and media
organizations, but the results of Russian democracy projects have been
mixed; (2) although U.S.-funded projects contributed to improvements in
the Russian news media, trade unions, and electoral system projects
designed to improve political party development, the rule of law, and
civil-military relations have fallen short of desired goals; (3) the
most important factor in project success has been the conduciveness of
the Russian environment to reform; (4) the Department of State and
Agency for International Development believe that Russian pro-democratic
reforms will take longer than previously anticipated; and (5)
U.S.-funded projects have not had a significant impact on reformist
national political party organizations, membership, or electoral
performance, since reformist parties have been unwilling or unable to
form coalitions, build national organizations, or convince the Russian
public to support their political message.

--------------------------- Indexing Terms -----------------------------

REPORTNUM: NSIAD-96-40
TITLE: Promoting Democracy: Progress Report on U.S. Democratic
Development Assistance to Russia
DATE: 02/29/96
SUBJECT: International relations
International cooperation
Elections
Federal aid to foreign countries
Political activities
Foreign policies
News media
Labor unions
Judicial reform
Foreign governments
IDENTIFIER: Russia
AID Atlantic Council Project
AID Internews Project
International Military Education and Training Program
AID Democratic Pluralism Initiative

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Cover
================================================================ COVER


Report to the Chairman and Ranking Minority Member, Committee on
International Relations, House of Representatives

February 1996

PROMOTING DEMOCRACY - PROGRESS
REPORT ON U.S. DEMOCRATIC
DEVELOPMENT ASSISTANCE TO RUSSIA

GAO/NSIAD-96-40

Promoting Democracy

(711129)


Abbreviations
=============================================================== ABBREV

CEC - Central Election Commission
DOD - Department of Defense
FTUI - Free Trade Union Institute
IFES - International Foundation for Electoral Systems
IMET - International Military Education and Training
IRI - International Republican Institute
NDI - National Democratic Institute for International Affairs
NED - National Endowment for Democracy
RAPIC - Russian-American Press Information Center
USAID - U.S. Agency for International Development
USIA - U.S. Information Agency

Letter
=============================================================== LETTER


B-270026

February 29, 1996

The Honorable Benjamin A. Gilman
Chairman
The Honorable Lee H. Hamilton
Ranking Minority Member
Committee on International Relations
House of Representatives

As requested, we reviewed U.S.-funded democracy programs of the U.S.
Agency for International Development (USAID); the U.S. Information
Agency (USIA), including projects funded by USIA's annual grant to
the National Endowment for Democracy (NED); the Department of State;
and the Department of Defense (DOD). This report focuses on
democracy projects in Russia and addresses whether such projects were
meeting their developmental goals and contributing to political
reform from fiscal years 1990 through 1994. To make this assessment,
we examined projects in six areas: independent media, trade union
development, political party development, rule of law development,
electoral support, and civil-military relations. We also inquired
into State and USAID views on the future of the U.S.-funded democracy
program in Russia.


BACKGROUND
------------------------------------------------------------ Letter :1

The United States has for many years funded various USIA
broadcasting, educational, and visitor programs in the former Soviet
Union to promote democratic ideas. Beginning in the mid-1980s, NED,
a U.S.-funded nongovernmental organization, provided small grants to
dissident groups throughout the former Soviet Union and funds for
journals, videos, and other materials that were distributed in Russia
and elsewhere. In 1990, NED began funding political organizing and
trade union development work by three of its core institutes.\1 In
fiscal years 1990 and 1991, NED, in part through these core
institutes, spent about $3 million for activities in or directed
toward Russia. Democratic development assistance to Russia increased
during fiscal year 1992, after the Soviet Union dissolved. From
fiscal years 1992 to 1994, the U.S. government, excluding USIA,
provided over $64.2 million in democratic development assistance to
Russia, of which $57.3 million was provided by USAID, $5.8 million by
NED, and $1.1 million by the State Department for a DOD program.
USIA was unable to provide specific funding information for its
activities in Russia because they were funded under a regional
project. Appendix I provides detailed information about U.S.
democratic development assistance to Russia from 1990 to 1994.

The democracy assistance program in Russia seeks to capitalize on the
historic opportunity to build democracy in place of a centralized
Communist system. The U.S. program is meant not only to demonstrate
U.S. political support for democratic reform in Russia but also to
help create and nurture the full range of democratic institutions,
processes, and values. U.S. efforts seek to increase the
responsiveness and effectiveness of the Russian government, as well
as the ability of Russian citizens to influence decisions affecting
their lives. Toward that end, U.S. assistance provides support to
independent media, democratic trade unions, reformist political
parties, and other nongovernmental organizations. It also supports
the Russian government's efforts to enhance election administration
and election laws, strengthen the courts and other legal
institutions, promote civilian control of the military, and improve
the quality of public administration.


--------------------
\1 NED provides grants to four core institutes: the Free Trade Union
Institute, The International Republic Institute, the National
Democratic Institute, and the Center for International Private
Enterprise. NED also has a discretionary grant program through which
it provides small grants to other prodemocracy and human rights
organizations.


RESULTS IN BRIEF
------------------------------------------------------------ Letter :2

U.S.-funded democracy projects have demonstrated support for and
contributed to Russia's democracy movement. Organizations and
institutions at the center of the democratic reform process have been
identified and supported, as have thousands of Russian activists
working at these organizations at the national, regional, and local
levels. Those assisted include prodemocracy political activists and
political parties, proreform trade unions, court systems, legal
academies, officials throughout the government, and members of the
media.

The democracy projects that we reviewed, however, had mixed results
in meeting their stated developmental objectives. Russian reformers
and others saw U.S. democracy assistance as generally valuable, but
in only three of the six areas we reviewed did projects contribute to
significant changes in Russia's political, legal, or social system.
USAID and USIA media projects largely met their objective of
increasing the quality and self-sufficiency of nongovernment or
independent media organizations, although the weak economy continues
to threaten the sustainability of an independent media. U.S.
efforts to help develop a democratic trade union movement and improve
Russia's electoral system also contributed to systemic changes,
although more needs to be done. However, projects in the areas of
political party development, rule of law, and civil-military
relations have had limited impact. Our analysis indicated that the
most important factors determining project impact were Russian
economic and political conditions. Project implementation problems
contributed to the limited results achieved from the rule of law
project.

State and USAID officials acknowledged that democratic reforms in
Russia may take longer to achieve than they initially anticipated.


DEMOCRACY PROJECTS HAVE HAD
MIXED RESULTS
------------------------------------------------------------ Letter :3


INDEPENDENT MEDIA
---------------------------------------------------------- Letter :3.1

The U.S.-funded independent media program in Russia has helped raise
the quality of print and broadcast journalism and contributed to
Russia's movement toward an independent, self-sustaining local
television network. USAID's Internews project, USIA's grant to the
Russian-American Press Information Center (RAPIC), and a number of
small grants awarded to Russian nongovernmental media organizations
by NED and the Eurasia Foundation have strengthened independent media
by donating equipment and broadcast materials to hundreds of local
television stations, teaching reporting skills to print and broadcast
journalists, and providing training in business and marketing to
media managers.

According to the State Department, the growth of independent media in
Russia began in 1990 during the Soviet era with the official
abolition of press censorship. The new openness created a conducive
environment for independent news reporting, as print and broadcast
media, both still largely state-owned at the time, frequently aired
views highly critical of the Communist government. Currently, print
and broadcast media in Russia represent a wide range of opinions.
Most operate unhindered from the Russian government and many are
privately owned.

Russian and U.S. officials said that the principal threat to media
independence in Russia today is the weak economy. For many media
organizations, advertising revenues are insufficient for continued
survival, forcing them into bankruptcy or joining larger affiliates,
thereby curtailing their independence and capacity to produce their
own programs. According to U.S. and other observers, many print and
broadcast outlets also face pressure from local political authorities
or from organized crime, in large part due to their dire financial
situations.

Internews Network has developed an active working relationship with
200 of the approximately 500 over-the-air broadcasters that currently
operate in the countries of the former Soviet Union,\2 the majority
in Russia. The technical assistance, training, and programming that
Internews provided enabled some local stations to become commercially
viable, according to U.S. officials and Russian participants. These
officials and participants also said that Internews has helped many
stations that have not achieved full commercial viability by
providing enough support to forestall bankruptcy, signing into
sponsorship arrangements, or becoming affiliates of larger networks.
(See app. II.)


--------------------
\2 Internews officials initially estimated that 3,000 local
television stations operate in the former Soviet Union, but many of
these stations broadcast to no more than a few apartment buildings
united by a cable. They later told us that 500 over-the-air
broadcasting stations are currently operating in the former Soviet
Union.


ELECTORAL SUPPORT
---------------------------------------------------------- Letter :3.2

The USAID-funded election administration project, implemented by the
International Foundation for Electoral Systems (IFES),\3 has made
important contributions to addressing the legal, institutional, and
procedural shortcomings evident during Russia's December 1993
national elections. For example, it assisted in the development of
Russia's Voting Rights Act--which was enacted into law during
November 1994--and other legislation governing elections for the
State Duma (the lower house of the Russian Parliament). Russia now
has a permanent and more independent election commission, voting
rights, and Duma election procedures that are based in law. This
improved the situation prevalent in December 1993, when national
elections were held by presidential decree, the Central Election
Commission (CEC) chairman was appointed by the President, and the
electoral process and administrative apparatus were holdovers from
the Communist era. IFES has also worked with the CEC to develop
electoral training and voter education programs to help ensure that
electoral procedures are properly carried out and to increase the
public's knowledge and participation in elections.

Nonetheless, IFES officials believe that more progress can be made in
electoral reform; for example, legislation governing elections for
the upper chamber of

U.S.-funded political party development programs in Russia,
implemented through NED and USAID grants to the National Democratic
Institute (NDI) and the International Republican Institute (IRI),
have not significantly strengthened reformist national political
parties, either organizationally or in terms of increased membership
or performance in elections. From 1990 through 1992, NDI and IRI
used about $956,000 in NED funds to help the anti-Communist
Democratic Russia Movement establish a printing facility and
disseminate literature. They also conducted civic education and
grassroots organizing programs for Russians at the national and local
level. Since 1992, USAID has awarded NDI and IRI a series of grants
with a combined value of $17.4 million to conduct programs in Russia
through 1997. USAID documents state that the overall purpose of
these grants is to assist reformist political parties strengthen
their organizations and their role in elections, Parliament, and
local government.

NDI and IRI have developed relationships with many party officials
and provided extensive training and assistance. However, because of
the inhospitable environment in Russia for political party
development, the institutes have had only minimal success in helping
to strengthen reformist national political parties, either in their
organization or in their election performance. Reformist parties--as
demonstrated by their showing in the December 1993 and 1995 elections
and by their difficulties in local elections--have been unwilling or
unable to form coalitions, build national organizations, or convince
large segments of the Russian public to support their political
message. In the spring of 1995, USAID, anticipating the poor showing
by reformist parties in the December 1995 parliamentary election and
additional problems for reformists in the June 1996 presidential
election, counseled NDI and IRI to direct more of their resources to
working with grassroots nongovernmental organizations. (See app.
V.)


RULE OF LAW
---------------------------------------------------------- Letter :3.5

U.S.-funded rule of law activities conducted under the Democratic
Pluralism Initiative\5 have contributed to incremental improvements
in reforming Russia's legal and judicial institutions, and they are
beginning to help build a grassroots constituency for legal reform.
Through an interagency transfer to the State Department and a grant
to the American Bar Association, USAID supported Russia's limited
reintroduction of jury trials and its first steps toward establishing
an independent judiciary, as well as commercial law training for the
Russian high arbitration court.

By the end of 1994, jury trials were operating in 9 of 89 regions in
Russia, and the government had enacted legislation intended to
increase the independence of the judiciary and to make many other
reforms in the criminal justice system. However, the widespread
reintroduction of adversarial jury trials was often not occurring as
scheduled because the Russian Federation and the regional governments
did not fund their implementation adequately, citing budgetary
constraints. By the end of 1994, Russian judges were only beginning
to assert their independence from other branches of government.

In late September 1993, USAID awarded a $12.2 million, comprehensive
rule of law project to ARD/Checchi to continue support for these
reform efforts over a 3-year period, expand them to develop other
Russian legal institutions, and encourage grassroots constituencies
for legal reform. The project aimed to assist in the development of
Russian legal institutions by supporting curriculum changes in
Russian law schools, including the addition of commercial law courses
and new substantive and procedural code reforms into the curriculum,
establishing continuing education for bar associations, providing
training to all judges of commercial law courts, and strengthening
the new Constitutional Court and the role of the defense counsel in
criminal cases. The contractor began to provide assistance in these
areas in late 1994 and early 1995.

As part of its contract, ARD/Checchi also awarded a $500,000
subcontract to FTUI to support efforts to address workers' rights
issues through Russia's court system, and it is managing a $2-million
small grants program to support U.S. and Russian nongovernmental
organizations' activities to promote the rule of law. As of May
1995, five grants had been awarded under this program.\6

ARD/Checchi was slow to initiate its core project activities.
According to USAID officials, the approximately 1-year delay in
starting the project was due partly to the inability of U.S. embassy
and USAID officials to respond to the contractor's proposed action
plan and to clearly articulate what they expected of the contractor.
In addition, it took some time for the contractor to (1) establish
contacts and design projects with Russia's historically closed legal
institutions and establish an office in Moscow, (2) become familiar
with USAID's administrative procedures, (3) and negotiate and award
contracts and grants to other nongovernmental organizations. It is
too soon to evaluate the effectiveness of the contractor's efforts to
support reform of the core legal institutions; however, officials
from USAID, the State Department, and the Russian government said
that systemic changes in Russia's legal institutions will be a
long-term process, given that the needs in this area are vast and
complex. (See app. VI.)


--------------------
\5 USAID's rule of law project dealing with commercial law reform
(the International Reform and the Informal Sector project) was not
included in our review because it was part of USAID's economic
restructuring and financial project and not part of the Democratic
Pluralism Initiative, and the Department of Justice's rule of law
program was not included because it had not begun at the time of our
fieldwork.

\6 NED and the Eurasia Foundation also provide small grants to U.S.
and Russian organizations that aim to promote the rule of law in
Russia.


CIVIL-MILITARY RELATIONS
---------------------------------------------------------- Letter :3.6

U.S. assistance projects intended to strengthen civilian control of
the Russian military, including the International Military Education
and Training (IMET) program and a USAID-funded Atlantic Council
project, had not made much progress in addressing their goals,
primarily due to a lack of interest by the Russian government.\7 U.S.
embassy data shows that from 1992 through 1994 the IMET program
brought 37 civilian and military officials,\8 primarily from the
Ministries of Foreign Affairs and Defense, to the United States for
training. However, according to the U.S. official responsible for
managing the program, civilian candidates have been chiefly mid-level
bureaucrats from the Ministry of Foreign Affairs who are not likely
to advance to positions of authority. He indicated that the Ministry
of Defense is leery of the program and has limited the participation
of Russian military officers. The Atlantic Council's 2-year,
$626,500 grant from USAID, started in 1992, was hindered by the
Council's inability to identify and select Russians to participate in
its training programs.

According to DOD, the IMET program is primarily a long-term effort to
influence the younger, promising officers of foreign militaries who
will rise to positions of prominence during their careers. However,
evidence indicates that little progress had been made in identifying
and selecting promising officers who are likely to rise to positions
of prominence, apparently because the Russian government was
unwilling to fully use the IMET program.

U.S. embassy officials told us that the Russian military retains
firm control of its sphere of operation and that few in-roads have
been made to exert greater civilian control. According to one
embassy official, even the Russian Parliament has limited detailed
knowledge of the military budget. Uniformed officials are also
predominant at the Russian Ministry of Defense. U.S. embassy
officials said that political circumstances in Russia make the
implementation of a U.S. civil-military program in Russia very
difficult. There is general antagonism to Western assistance from
some quarters of the government and some suspect that civil-military
assistance is designed to further weaken Russia militarily. Also,
deep cuts in defense spending have made the process of greater
civilian control in the Ministry of Defense more complex, as
significant hiring of civilian employees is unlikely, especially with
the large numbers of currently unemployed military officials. (See
app. VII.)


--------------------
\7 Program management for the IMET program is divided between the
State Department and DOD. The Secretary of State is responsible for
the program's general direction, and he also recommends funding
levels for congressional approval and allocates approved funds to
each country. The Secretary of Defense is responsible for planning
and implementing the program, including administration and
monitoring, within established funding levels.

\8 DOD said that the number of participants published in its annual
Congressional Presentation Document is gathered indirectly and may
vary somewhat from the number provided by the U.S. embassy, but that
the embassy count is more accurate.


STATE AND USAID VIEWS ON THE
FUTURE OF U.S. DEMOCRACY
ASSISTANCE IN RUSSIA
------------------------------------------------------------ Letter :4

When USAID began providing democratic development assistance in
Russia, it did so without conducting needs assessments or developing
a country strategy, as it was under considerable pressure to
implement projects quickly. Instead, USAID relied on unsolicited
proposals that largely replicated democracy assistance programs
underway in Central and Eastern Europe, using many of the same
contractors and grantees.

State and USAID officials now believe that democratic reforms in
Russia may not be as easily or quickly consolidated as they had
originally hoped. They are now focusing less on assisting national
institutions and short-term political events, such as elections, and
are emphasizing more long-term development of local, grassroots
organizations capable of building a popular consensus for democratic
reform. According to these officials, this means that it may be
desirable for the United States to continue democratic development
activities in Russia after assistance in the economic reform arena
has ended.


AGENCY COMMENTS
------------------------------------------------------------ Letter :5

USAID, USIA, and DOD generally agreed with our report, but they
suggested minor changes that were incorporated where appropriate.
State said that we should have discussed how the Department of
Justice's rule of law program and DOD's exchange program conducted
under the Cooperative Threat Reduction program contribute to
democratic development. We agree that law enforcement assistance can
contribute to democratic development; however, the Department of
Justice's project had not begun at the time of our fieldwork in
Russia. (We are currently evaluating this project as part a review
of U.S. anticrime assistance to the former Soviet Union.) According
to DOD, the Cooperative Threat Reduction program is not
democracy-related, although it does occasionally fund some
democracy-related activities.\9

NED agreed with our general conclusions but said we should have
included projects by the Center for International Private Enterprises
in our review because the Center's projects also helped build a
constituency for free market democratic reforms. Although the
Center's projects may have contributed to democratic reforms, the
primary focus of the Center's projects was to promote privatization
and promarket reforms, two areas outside the scope of our review.

NED also provided us with written comments of NDI and IRI, two of
NED's core institutes that have operated in Russia primarily as USAID
grantees. Both NDI and IRI indicated that the development of
reformist political parties in Russia may take many years. NDI said
that its programs have produced positive results and that by their
nature, these programs are often long-term investments in
individuals, institutions, and processes. IRI said its approach has
been to help those Russians dedicated to democracy begin to build
democratic parties up from the grass roots. However, evidence
indicates that little progress had been made toward the development
of reformist political parties despite NDI and IRI's efforts.

Comments from State, DOD, USAID, USIA, NED, IRI, and NDI are
reprinted in appendixes VIII through XIV, respectively.


--------------------
\9 Promoting Democracy: Foreign Affairs and Defense Agencies Funds
and Activities--1991 to 1993 (GAO/NSIAD-94-83).


SCOPE AND METHODOLOGY
------------------------------------------------------------ Letter :6

We used the State Department's definitions to determine which
assistance programs were democracy-related. These programs included
civic education and organization, civil-military relations, human
rights training, election reform, media training and development, and
legislative, rule of law, political party, trade union, and public
administration development. Our scope was limited to an evaluation
of projects in the areas of independent media, rule of law, political
party development, trade union development, electoral assistance, and
civil-military relations.

We interviewed numerous U.S. government officials in Washington,
D.C., who manage and coordinate their agencies' democracy assistance
to Russia, specifically, officials from the State Department, USAID,
DOD, and USIA. We also met with NED officials and officials from
NDI, IRI, FTUI, IFES, Internews, ARD/Checchi, the American Bar
Association, and the Eurasia Foundation. We reviewed (1) agencies'
strategy papers, program documents, project evaluations, and budget
data and (2) grantees' internal documents, such as trip reports, and
their official reporting to the U.S. government on the status and
impact of their projects. We also verified the scope of work of some
nongovernmental organizations--both Russian and American--that
received selected small grants from the Eurasia Foundation and NED.

We visited five Russian cities, in addition to Moscow and
St. Petersburg--one north of St. Petersburg, two in the Black Sea
region, and two in southwest Siberia. While in these cities, we met
with U.S. embassy and agency officials who manage and coordinate
democracy projects, as well as in-country staff of USAID and USIA
contractors and grantees who implement the projects. In addition, we
interviewed Russian government officials in the presidential
administration, government ministries, and the State Duma to obtain
their assessment of U.S.-sponsored democracy projects. We also
interviewed numerous Russians who received U.S. training, technical
assistance, and financial or material donations, including judges,
legal administrators and practitioners, political party organizers,
activists and candidates for local elections, union leaders and
members, station managers, broadcast technicians, print journalists,
election officials, and representatives from women and youth groups.
Also, we attended a number of meetings, seminars, and training
sessions held or organized by the U.S. contractors or grantees to
observe their activities.

We did not evaluate USAID's public administration and nongovernmental
organization support projects. We also did not evaluate the
University of Maryland's and the Harvard Institute for International
Development's legal reform activities because they are sponsored
under USAID's Economic Restructuring Project rather than its
democracy initiative, although we recognize the link between these
programs. We did not review the effectiveness of democracy-related
USIA and USAID exchange and visitor programs due to the difficult and
time-consuming task of locating individual program participants.

We conducted our review between March 1994 and September 1995 in
accordance with generally accepted government auditing standards.


---------------------------------------------------------- Letter :6.1

We are sending copies of this report to the Secretaries of State and
Defense, the Administrator of USAID, the Director of USIA, the
President of NED, and the Chairmen and Ranking Minority Members of
the appropriate congressional committees. We will also make copies
available to others upon request.

Please call me at (202) 512-4128 if you or your staff have any
questions concerning this report. The major contributors to this
report are listed in appendix XV.

Harold J. Johnson, Associate Director
International Relations and Trade Issues


U.S. DEMOCRATIC DEVELOPMENT
ASSISTANCE TO RUSSIA (FISCAL YEARS
1990 TO 1994)
=========================================================== Appendix I

U.S. democracy assistance to Russia includes projects funded or
implemented by a number of agencies, including the U.S. Agency for
International Development (USAID); the Department of Defense (DOD);
and the U.S. Information Agency (USIA) through its annual grants to
the National Endowment for Democracy (NED). Table I.1 summarizes
these programs.



Table I.1

Estimated Obligations for U.S.-Funded
Democratic Development Assistance in
Russia,\a Fiscal Years 1990-94

(Dollars in Thousands)

Agency FY 1990 FY 1991 FY 1992 FY 1993 FY 1994 Total
-------- ---------- ---------- ---------- ---------- ---------- ==========
USAID
--------------------------------------------------------------------------------
Democrat $3,376 $13,268 $35,368 $52,013\b
ic
Plurali
sm
Initiat
ive
Eurasia 300 2,300 2,600
Foundat
ion\c
Exchange 2,681 2,681
s and
trainin
g\d
================================================================================
Subtotal 3,376 13,568 40,349 57,294\b

DOD
--------------------------------------------------------------------------------
Internat 153 471 471 1,095
ional
Militar
y
Educati
on and
Trainin
g

USIA/NED
--------------------------------------------------------------------------------
National 165\e 238\e 100 32 535
Democra
tic
Institu
te
Internat 50\e 326\e 77\f 84 537
ional
Republi
can
Institu
te
Free 350\g 1,000\g 1,420\g 1,482 1,046 5,298
Trade
Union
Institu
te
Discreti 382 512 280 483 808 2,465
onary
grants
================================================================================
Subtotal 947 2,076 1,877 2,081 1,854 8,835
================================================================================
Total $947 $2,076 $5,406 $16,120 $42,674 $67,224\b
--------------------------------------------------------------------------------
\a Funding is reported as obligations, except for Eurasia grants, the
International Military Education and Training (IMET) program, and NED
grants, which constitute grant totals for the fiscal year.
Activities funded by all organizations may extend into subsequent
fiscal years.

\b Figures do not add due to rounding.

\c Only includes democracy-related Eurasia grants, such as those
related to media, the nonprofit sector, and governmental reform.

\d This figure is the portion of USAID's exchanges project used to
support democracy projects.

\e Although these funds were primarily for activities in Russia, a
portion was used for activities in other former Soviet republics.

\f Estimated amount from a regional grant that covered three
republics of the former Soviet Union.

\g For fiscal years 1990 through 1992, the Free Trade Union Institute
figures include funds for all programs throughout the former Soviet
Union. Its fiscal year 1990 figure also includes funds for
activities in the Baltic States.

Source: USAID, DOD, and NED.

As indicated in table I.1, the majority of USAID democracy-related
funding in Russia involved grants awarded under its Democratic
Pluralism Initiative for the New Independent States. Major
activities funded by USAID in Russia under this initiative include
efforts to develop and strengthen independent media, new democratic
trade unions, reformist political parties, laws and legal
institutions, election processes, local government, nongovernmental
organizations, and civilian control of the military. Some activities
under this initiative are implemented through transfers from USAID to
other agencies, such as to USIA for journalist training and to State
for rule of law activities. Other USAID democracy-related activities
in Russia not part of the initiative include funding for the Eurasia
Foundation, which awards small grants for media, public
administration, and other projects, and an exchange program USAID
uses to support all its assistance projects.

DOD shares program management for the IMET program with the State
Department. The Secretary of State is responsible for the program's
general direction, and he also recommends funding levels for
congressional approval and allocates approved funds to each country.
The Secretary of Defense is responsible for planning and implementing
the program, including administration and monitoring, within
established funding levels.

NED provided about $8.8 million from its annual USIA grants for
democracy-related activities in Russia from fiscal years 1990 through
1994. Of that amount, about $6.4 million was spent on activities
implemented by three of NED's four core institutes--the National
Democratic Institute, the International Republican Institute, and the
Free Trade Union Institute--which have also received significant
USAID funding. This figure is somewhat overstated because the Free
Trade Union Institute's figures for fiscal years 1990 through 1992
include funds for all of its activities in the former Soviet Union;
based on the data available, we could not estimate the amount of
funds that were spent on activities in Russia.

The remaining NED funds were for its small grants program, which from
fiscal years 1990 through 1994 included 64 grants ranging between
$10,000 and $100,000 in support of human rights, civic education,
public advocacy, and media projects. NED's fourth core institute,
the Center for International Private Enterprise, spent about $572,000
in Russia from fiscal years 1992 through 1994, primarily for grants
to governmental and nongovernmental organizations that seek to
promote privatization and promarket reform.

Other USIA programs in Russia currently involve a wide variety of
exchange programs and educational and cultural activities, many of
which are intended to directly support Russia's transition to
democracy. USIA told us it does not maintain specific country
funding information because its activities were funded under regional
projects.


INDEPENDENT MEDIA
========================================================== Appendix II

The purpose of the U.S.-funded independent media program in Russia is
to ensure the quality and self-sufficiency of nongovernment or
independent media organizations so that the Russian people have
access to truthful information and a forum for open expression. U.S.
media projects seek to raise the reporting skills of journalists,
provide training in business and marketing to media managers, donate
equipment and broadcast material, and facilitate sharing of news
information. We reviewed USAID's 3-year, $4.9 million grant to
Internews Network; USIA's 3-year, $600,000 grant to the
Russian-American Press Information Center (RAPIC); and a number of
small grants awarded to Russian nongovernmental media organizations
by NED and the Eurasia Foundation. Overall, we found that the
independent media program has helped expand and raise the quality of
news reporting throughout the Russia Federation. Nonetheless,
independent media in Russia remains insecure, as the difficult
economic environment limits advertising revenue while political
intimidation against the media continues to be exercised by some
regional and local authorities.

The growth of independent media in Russia began in 1990 during the
Soviet era with the official abolition of press censorship.\1 The new
openness created a conducive environment for independent news
reporting, as print and broadcast media organizations, still largely
state-owned at the time, frequently aired views highly critical of
the Communist government.\2 Currently, most media organizations
operate unhindered by the Russian government and many are privately
owned. The principal threat to media independence in Russia today is
the weak economy,\3 according to U.S. and Russian officials and
State Department reporting. For many organizations, advertising
revenues are insufficient for continued survival, forcing them into
bankruptcy or into joining larger affiliates, thereby curtailing
their independence and capacity to produce their own programs. Print
and broadcast organizations also face pressure from local political
authorities or from organized crime. Media organizations are
susceptible to such pressure because of their dire financial
situations and because many occupy city-owned premises, receive
subsidies, or depend on government-owned enterprises for supplies.

Media coverage of the conflict in Chechnya was remarkably open, as
views highly critical of the government were aired by both state and
privately-owned television stations and newspapers. Nonetheless,
according to the State Department's 1994 Human Rights Report, the
Russian government limited access by journalists to some areas of the
conflict, claiming the need to protect military secrets and ensure
journalists' safety.


--------------------
\1 This information is drawn from the State Department's human rights
reports on Russia from 1990 to 1994.

\2 Freedom of speech was briefly curtailed during the failed
pro-Communist coup in August 1991, and again in late 1993 during the
standoff between President Yeltsin and the Parliament of the Russian
Federation.

\3 The U.S. government supports Russia's macroeconomic policy
reforms through USAID's Economic Restructuring Project. This project
was outside the scope of our review.


INTERNEWS HELPS STRENGTHEN
LOCAL INDEPENDENT TELEVISION
-------------------------------------------------------- Appendix II:1

The purpose of the Internews project is to aid in the establishment
of an independent, self-sustaining television news network to
facilitate alternatives to state-owned television. The project is
part of a regional grant that also includes activities in Armenia,
Azerbaijan, Belarus, Georgia, Kazakhstan, and Ukraine. Project
components include (1) journalist and management training programs;
(2) equipment procurement; (3) production and distribution of a
weekly news program utilizing news reports from local stations; (4)
production of public affairs documentaries; and (5) acquisition and
distribution of low cost, quality programming to participating
stations to raise viewership and advertising revenue.

Our review of the Internews project indicates that it has made a
significant contribution toward achieving its purpose. Internews is
the only organization of its kind operating in the former Soviet
Union to assist fledgling local independent television stations. The
technical assistance, training, and programming that Internews
provides have helped some local stations to become commercially
viable, according to U.S. officials and Russian participants.
According to Internews officials, Internews has also helped many
stations that have not achieved full commercial viability by
providing enough support to forestall them from entering bankruptcy,
signing into sponsorship arrangements, or becoming affiliates of
larger networks.

Of the 500 over-the-air broadcasters that currently operate in the
former Soviet Union,\4

200, the majority in the Russian Federation, have an active working
relationship with Internews. At the national level in Russia,
privately owned broadcast companies, such as NTV and TV6, have
emerged and challenged the dominance of the state-owned national
broadcasting companies. While the state-owned companies are only
minimally supervised by the government, the privately owned broadcast
companies nonetheless provide competition and diversity to state
broadcasting, particularly in Moscow and other large urban centers.
According to State Department and Internews officials, television
stations at the regional level, some of which were once part of the
central broadcasting system of the Soviet-era, now operate more or
less independently. They can choose affiliation to one of the state
or private national networks and can use material from these networks
or produce their own local programming. The ability of these
stations to produce their own local programming provides diversity to
news and information, which traditionally has been Moscow-centric.
According to Internews, the greatest hindrance to the development of
independent local television is the unstable economic situation.
Additionally, all local stations depend to some extent on local
political authorities.\5

The Internews project has helped strengthen local independent
television stations through the following activities.

Conducting over 60 training programs in journalism, station
management, advertising, and other commercial survival skills to
over 2,000 station personnel and journalists. Russian
participants told us the training sessions were very beneficial
and were state-of-the-art. They said the training was hands-on
and relevant to running a modern, commercially viable television
station.

Providing grants of video equipment to stations that either lack or
have outdated video technology and making available production
equipment free of charge to support Russia's indigenous
documentary film industry.

Organizing a network of over 110 independent television stations
throughout Russia and neighboring countries, which helps pool
limited programming resources.

Coordinating production of Local Time--a weekly half hour news
program. This program is distributed to any interested local
station and is estimated to reach an audience of 100 million
people in five countries. As of April 1995, Internews had
produced over 110 episodes, with over 40 local stations in
Russia alone contributing stories from their regions.

Producing several docudramas--What If--on topical legal and
political issues, including commercial law, civil law, privacy
rights, and private property rights.

Acquiring and distributing quality Western and domestic documentary
programming to over 170 Russian stations free of charge to
attract viewers and advertisers--thereby increasing the economic
viability of these stations during this transition period.

Linking more than 20 regional independent stations in a
computer-based electronic mail network for purposes of editorial
coordination and information exchange.

As the Internews project was about to end at the time of our
fieldwork, USAID awarded a new $10 million, 3-year consortium grant
to Internews and RAPIC to implement a media partnership program. The
program will place U.S. media organizations in association with
Russian counterparts to facilitate the transfer of U.S. management
expertise, training, equipment, and other resources. However, it was
too soon to determine the effectiveness of this project.


--------------------
\4 Internews officials initially estimated that 3,000 local
television stations operate in the former Soviet Union, but many of
these stations broadcast to no more than a few apartment buildings
united by a cable. They later told us that 500 over-the-air
broadcasting stations are currently operating in the former Soviet
Union.

\5 According to Internews officials, broadcasting is also potentially
susceptible to national government control due to the government's
monopoly of transmission facilities.


RAPIC'S SUPPORT FOR PRINT MEDIA
-------------------------------------------------------- Appendix II:2

The objective of the RAPIC grant, which is funded by USIA, is to
develop a stable, profitable press in Russia. Elements of RAPIC's
program include (1) management training workshops, (2) journalist
training seminars, (3) establishment of regional centers to serve as
information clearinghouses, and (4) sponsorship of press conferences
to provide a forum for an exchange of ideas. Our review of this
grant indicates that RAPIC's regional centers have helped strengthen
the print media in the regions they serve. The centers provide
training to Russian journalists, access to wire services and on-line
data bases, and serve as a meeting place for print and broadcast
journalists and a forum for press conferences on a variety of topics,
including politics, economics, science, and the arts. According to
U.S. officials and Russian journalists we met with at RAPIC centers
in Moscow, St. Petersburg, and Novosibirsk, the quality of
journalistic reporting has increased notably, especially among the
small, regional newspapers. These officials credited the training
journalists received and the access to new sources of information by
RAPIC for the improved reporting. They told us that while the
quality of journalism in Russia is still in need of improvement,
newspapers are reporting news in a more objective fashion.


SMALL GRANTS TO MEDIA
ORGANIZATIONS
-------------------------------------------------------- Appendix II:3

The Eurasia Foundation and NED provided small grants, ranging from
$10,000 to $110,000, to Russian and U.S. nongovernmental
organizations for institutional training and budgetary support to
Russia's grassroots media organizations. They also financed specific
media projects that provide a prodemocracy angle to Russia's economic
and political reform process. Some of the grants funded by the
Eurasia Foundation were made to

Freedom Channel, for a three-part television series on the dangers
and remedies of hyperinflation;

Duke University, for several projects of the Commission on Radio
and Television Policy, including production of a media policy
guidebook and an exchange program;

Freedom Channel, in conjunction with Persona, an independent
Russian television production company, for the development and
broadcast of programming related to economic reform and
prodemocracy topics such as conflict resolution and freedom of
speech;

Globe Independent Press Syndicate, for the "Freedom Link Computer
Network" that provides international sources of information to
regional newspapers in Russia by electronic mail; and

KSKA Anchorage, for a training program on radio and television
production, basic journalism and communication, and business
practices for managers and reporters from radio and television
in the Russian Far East.

Some of the grants funded by NED went to

New Times, for a series of articles exposing the threat of Russian
nationalists, fascists, and other extremist organizations and
increasing the appeal of democratic solutions to Russia's
problems;

Panorama, for the research, publication, and the maintenance of a
database on political organizations and political personalities
throughout the former Soviet Union;

Express Chronicle, an independent Russian-language weekly newspaper
published in Moscow that specialized in human rights reporting;

Globe Press Syndicate, for a syndication service that provided
small regional newspapers with prodemocracy news and more varied
and detailed information about political, economic, and social
changes taking place in Russia; and

Freedom Channel/Persona, a joint American and Russian television
project, for the production of prodemocracy documentaries on
such topics as conflict resolution and freedom of speech.


ELECTORAL ASSISTANCE
========================================================= Appendix III

The United States helped Russia improve its election administration
through a USAID grant to the International Foundation for Electoral
Systems (IFES).\1 This 3-year, $10.7 million regional grant enabled
IFES to work in any country of the former Soviet Union, provided it
has U.S. and host country approval. In Russia, the IFES project
objectives were to help make elections free and fair and increase
public participation. IFES conducted a pre-election technical
assessment in Russia in June 1993. It subsequently served as a key
advisor to Russia's Central Election Commission (CEC) prior to the
December 1993 elections. Since then, IFES has been working to help
Russian organizations rectify many of the legal, institutional, and
administrative shortcomings made evident during the elections.

IFES has made several important contributions to improve Russia's
electoral administration structure, including contributing to passage
of Russia's Voting Rights Act in November 1994 and more recently
legislation governing elections for the State Duma (the lower house
of the Russian Parliament). These laws establish a permanent and
more independent election commission, as well as voting rights and
Duma election procedures based in law. This situation compares
favorably to the situation in December 1993, when elections were held
by presidential decree, CEC members were appointed by the President,
and the electoral process and administrative apparatus were holdovers
from the Communist era. IFES has also worked with the CEC in
developing electoral training and voter education programs to ensure
that electoral procedures are properly carried out and to increase
the public's knowledge and participation in elections.

Nonetheless, despite these efforts, IFES officials believe that more
needs to be done to ensure that future elections in Russia will be
free and fair. As of our review, legislation governing elections for
the upper chamber of Parliament or for regional and local political
bodies still had to be passed. Moreover, newly passed laws and
procedures still had to be applied and tested in practice.
Countrywide local elections held in 1994 raised concerns about future
national elections, as these elections were marked by many
irregularities and low voter participation.


--------------------
\1 In late summer 1995, IFES changed its name to the International
Foundation for Election Systems.


NUMEROUS PROBLEMS EVIDENT
DURING DECEMBER 1993 ELECTIONS
------------------------------------------------------- Appendix III:1

IFES provided advice and equipment and coordinated international
observers for the CEC prior to the 1993 elections but did not have
much of an impact on how the elections were administered. According
to U.S. officials and IFES reporting, the elections displayed
several shortcomings.\2 For example, the CEC lacked independence,
particularly from the presidential administration. Presidential
decrees continually undermined CEC decisions, and after the election
it was the presidential administration, rather than the CEC, that
controlled the ballots and first announced the election results.\3
There were also problems stemming from ballot security, incomplete
and inconsistent election regulations, insufficient election
commodities and technology, and inadequate oversight of campaign
finances.

IFES's limited impact was due to the difficult political
circumstances in which the elections were held and the short period
of time available to address shortcomings in the electoral system.
The December 1993 elections were called in September 1993, in the
midst of a violent standoff between the executive and legislative
branches. No legally established, independent apparatus existed in
Russia to administer national elections, as President Yeltsin simply
appointed the CEC by decree, while leaving intact 88 regional,
district, and local commissions that were holdovers from the Soviet
era. Such commissions remained closely tied to local political and
administrative bodies, themselves little changed since the Soviet
era.\4 As IFES pointed out in its technical assessment published in
November 1993,\5 Russia's election administration system suffered
from numerous problems on the eve of the December 1993 elections,
including weak mechanisms to protect against ballot and electoral
fraud and a Russian populace with no experience in multiparty voting.


--------------------
\2 The elections were selection of a new Parliament and approval of a
proposed constitution.

\3 Many observers believe that the Constitutional referendum was
invalid due to insufficient voter turnout. According to U.S.
officials, complete protocols for all local polling sites were never
made available to the CEC and may have been destroyed.

\4 The electoral apparatus that was used to supervise the mostly one
candidate, one party elections that were held during the Soviet era
remained mostly intact after the collapse of communism, as no
national elections were held in Russia after the breakup of the
Soviet Union until December 1993, with the exception of the April
1993 national referendum. As a result, the election system had no
grounding in Russia's new legal system and strong ties remained
between officials in local electoral commissions and in other
political or administrative bodies.

\5 "Elections in Russia: A Technical Assessment," International
Foundation for Electoral Systems,
Nov. 10, 1993


IFES HAS CONTRIBUTED TO SOME
IMPROVEMENTS
------------------------------------------------------- Appendix III:2

Since the 1993 elections, IFES has worked to ensure the CEC's
independence and strengthen Russia's election administrative
processes. Examples of IFES project activities follow:

Providing advice and written commentaries on electoral legislation
and other election-related initiatives. In November 1994,
Russia passed a Voting Rights Act, which established the CEC and
the regional commissions as permanent, legal bodies and ensured
political balance in the appointment of commissioners. Since
the passage of the act, a new CEC has been appointed. The act
reflected IFES's recommendations and included provisions on
ballot security, publication of election results, regulations on
campaign financing, and mechanisms to improve oversight of local
commissions. Its advice and comment were also reflected in
recently passed legislation governing elections to the State
Duma and to draft laws on presidential elections, public
referenda, and local elections.

Helping design and institute a training program for election
officials and poll workers to ensure the application and
enforcement of new legislation.

Organizing conferences with CEC, State Duma members, presidential
administration officials, and political party leaders to discuss
the role of the CEC and the rights and responsibilities of
political parties under the new election laws.

Holding roundtable discussions on such topics as ballot security,
polling procedures, grievance adjudication, and reporting
election results.

Assisting in the establishment of an electoral archive in order to
create an institutional memory of elections in Russia.

Designing and implementing a national voter education program in
conjunction with the CEC, Ministry of Education, and the media,
to provide voters with nonpartisan election information.

CEC officials indicated they value their collaboration with IFES and
hope it continues. Although they believe they have made progress in
improving Russia's electoral administration system, they said it
would take the experience of holding many elections before elections
would run smoothly. U.S. and IFES officials also agree that more
work is needed to improve electoral administration, including the
passage of additional electoral legislation and assurances that such
legislation will be appropriately applied. For example, despite the
activities and accomplishments of the CEC and IFES, local elections
held throughout Russia over the past 18 months have not fared well.
According to IFES officials, the winners of these elections regularly
included the heads of local administrations--who were often
responsible for the organization of the elections.


TRADE UNION DEVELOPMENT AND
WORKERS' RIGHTS
========================================================== Appendix IV

U.S. financial support for the development of democratic trade
unions and support for workers' rights in Russia was provided through
NED and USAID grants to the Free Trade Union Institute (FTUI) of $5.3
million for activities from 1990 through 1995 and $7.7 million for
activities from 1992 through 1997, respectively. The purpose of U.S.
support of democratic trade unions is to give workers a means of
participating in the new political and economic environment.
According to program documents and U.S. and Russian officials, if
workers are not given a voice during this transitional period and
believe that free markets and democracy only work to their
disadvantage, then they could pose a threat to social peace and
political and economic development.

Trade union development assistance in Russia has helped increase the
size and effectiveness of democratic trade unions. FTUI provided
important support for democratic trade unions early in their
existence, at a time when unions were challenging the Soviet system.
The first independent, noncommunist unions in the former Soviet Union
arose in the mining regions of Siberia in the late 1980s. These
unions backed Boris Yeltsin and Democratic Russia and other reformist
groups and played a key role in the breakup of the Soviet Union.
FTUI supported these unions by providing them with equipment and
training in Russia and the United States. FTUI's support for
democratic unions since the breakup of the Soviet Union has helped
increase the quality of Russian unions through an extensive education
program. It has achieved some success in increasing the size of some
unions, assisting in the formation of regional and national union
confederations, and increasing the public's and government's
knowledge of worker and union issues. It also financially supports
increasingly effective efforts to address workers' rights issues
through Russia's court system.

FTUI's efforts to help form or strengthen new democratic unions,
nonetheless, have been hampered by the continued control the
successors to the official Communist trade unions have over workers,
as well as by the inexperience and isolation of democratic unions,
the apathy of Russian citizens, and the weakness of the economy. The
old official unions remain the largest unions in Russia. During the
Soviet era, they were inseparable from the oppressive party and state
apparatus and until the final years were the only unions allowed.
They retain many of their assets, and so are less dependent than the
democratic unions on collecting dues. They also still exert control
over many workers through their continued ability to dispense social
welfare benefits in some locations. The old official unions have
been less receptive to reform; for example, they supported the
leaders of Parliament in their efforts during the fall of 1993 to
overthrow President Yeltsin.


EARLY SUPPORT FOR INDEPENDENT
TRADE UNIONS
-------------------------------------------------------- Appendix IV:1

The independent Soviet workers' movement began as a mass movement in
the summer of 1989. With NED funding from 1990 through 1992, FTUI
established relationships with and provided financial and other
support for the most important independent or democratic unions in
Russia, including the Independent Miner's Union, the Seafarer's
Union, and Sotsprof. Initially, mine workers were the largest source
of independent trade union activity in the Soviet Union, with
independent miners' unions generally aligning themselves with the new
government of the Russian Republic, led by Boris Yeltsin. During the
miners' strike in the spring of 1991, miners repeated demands first
raised in 1990 for radical changes in Soviet political and economic
life, including the resignation of top Soviet leaders, and forced the
government to cede power from Moscow to republic-level coal
ministries.

Following the 1989 strikes, FTUI provided the Independent Miners'
Union and other independent unions with equipment, training, and
technical advice and brought independent union leaders to the United
States for training. Officials we met with representing some of
Russia's first independent or democratic unions, which today comprise
the largest democratic unions, told us they greatly appreciated and
benefited from FTUI's support during the early days of their unions'
existence. At the time of our review, many of the early union
leaders who were supported by FTUI were working in the government,
where, according to union officials, they were attempting to get the
government to address labor issues.

According to State Department reporting, the growth in independent
trade unions occurred as the Soviet Union's Supreme Soviet and later
the Russian government passed laws that formally established the
right to strike, improved the legal conditions for independent trade
unions, and provided for the right of workers to form or join trade
unions. However, increases in the size and number of independent
trade unions were slowed by an economy in crisis; legal harassment
and physical violence related to union organizing activities,
including threats and intimidation from enterprise management, who,
according to free union officials, had the passive support of
nonindependent union officials and local politicians; and official
trade unions maintaining effective, day-to-day control over the
social insurance fund, from which it dispersed benefits such as
workers' vacations and sick pay. Independent union leaders
considered the continued control of the insurance fund by official
trade unions the biggest obstacle to establishing independent unions.


FTUI'S CONTRIBUTION TO
INDEPENDENT TRADE UNIONS
-------------------------------------------------------- Appendix IV:2

Beginning in 1992, FTUI's direct support for unions, education,
outreach and information dissemination, and legal assistance programs
have made varying contributions to the development of new, democratic
labor unions. However, two of FTUI's activities--specifically the
research activities of the Russian American Foundation for Free Trade
Union Research and a grant to a human rights organization for a media
project--did not make significant contributions to either trade union
development or workers' rights.


DIRECT SUPPORT FOR UNIONS
------------------------------------------------------ Appendix IV:2.1

FTUI's NED-funded direct support for unions includes training union
organizers, subsidizing the salaries of staff and organizers, and
providing equipment. After early successes with the Independent
Miners' Union from 1990 through 1992, FTUI's assistance for union
organizing slowed during 1993, as FTUI staffers were focused on
starting their USAID-funded program and the Russian director of the
organizing activities became ill. However, during the first quarter
of fiscal year 1994, FTUI-assisted organizers participated in 40
registration campaigns, helping organize over 3,000 new members for
various unions in five different regions. Currently, these
organizers are focused on training a cadre of Russian organizers to
work directly with unions. In addition to providing training for
union organizers, FTUI directly supports unions by paying the
salaries of Russian staffers or interns at several national trade
union structures who have, among other things, helped organize unions
in several regions, advised unions on draft legislation, and devised
wage provisions for tariff agreements. According to FTUI, the
efforts of one intern to revise the charter of the Independent
Miners' Union directly led to the doubling of that union. In
addition, FTUI has spent up to $20,000 per quarter since 1991 on
donations of computers, fax machines, and other office equipment for
the Independent Miners' Union and other unions. We observed
FTUI-donated equipment at the headquarters of a regional affiliate of
the miners' union in Siberia and found that it was in good working
condition; officials described it as essential to their operations.

FTUI has directly supported the largest of the independent labor
unions, including Sotsprof (about 300,000 members), the Confederation
of Maritime Workers (about 86,000 workers), and a regional affiliate
of the Independent Miners' Union of Russia (about 95,000 members).
According to FTUI and U.S. officials, the independent labor movement
grew to between 3 million and 5 million workers by late 1994, out of
a total workforce of 60 million to 75 million, the large majority of
which belonged to unions. About 2.2 million members of the
independent labor unions are part of the Mining and Metallurgy Union,
which broke away from the old official trade union in 1993; this
union has received FTUI's help in its reform efforts since then.

According to State Department human rights reports, growth in the
democratic workers' movement during 1991 and 1992 resulted in several
hundred union-like organizations forming across Russia; however, most
were small and served more as workers' associations and did not
appear to carry out traditional labor activities. A FTUI official
told us that many of the unions that FTUI helped register over the
past few years were not true trade unions because of their small
size. Under Russian law, organizations can register as unions with
membership as small as 15 people.\1 At the time of our visit, FTUI
was beginning to explore ways of helping these small organizations
become larger, viable unions.

In 1994, the majority of Russian workers still belonged to the old
official union, the successor to the Soviet-era Communist union
center, even as the membership declined from 65 million to 50
million. Despite the loss of members, the old official union
retained its historical influence with the government and enterprise
management, as well as many of the privileges and control mechanisms
that existed in the Soviet era.

The decision of the Mining and Metallurgy Union to split from the old
official union raises an issue of whether FTUI should work with this
union to facilitate additional splits. FTUI generally opposes
working with the former Communist party unions because it believes
these unions are not reformable and any relationship could undermine
its work with proreform unions. FTUI believes it is more effective
to build new union structures rather than attempt to reform the old
official unions, as these unions are led by enterprise managers and
former Communist party functionaries. Additionally, FTUI officials
said that the Mining and Metallurgy Union is unique in supporting
reform and still has a long way to go in changing the way it
operates. A U.S. embassy official we spoke with was sympathetic to
FTUI's position; however, this official believed there may be some
opportunity for FTUI to facilitate splits within the old official
Communist union.

Despite FTUI's position against working with the old official union,
since 1992 FTUI has provided the American Federation of Teachers with
$160,000 to, among other activities, help members of the old official
union democratize their affiliated unions or to form or join
independent trade unions. However, FTUI officials recognized many
obstacles to getting more unions to break away from the official
trade union. In commenting on this report, USAID said that it fully
supported FTUI's opposition to working with the official trade union.
USAID believes that FTUI's strategy of building new union structures
is the appropriate course of action.


--------------------
\1 We asked this official to provide us with data on the number and
membership of trade unions that FTUI helped register. The official
was unable to do so because its Moscow office had been destroyed by
fire.


EDUCATION
------------------------------------------------------ Appendix IV:2.2

FTUI helped independent trade unions to improve their operations
through an extensive education program for union leaders and members.
This program was implemented by FTUI in 1991 and 1992 with NED
funding. Since 1993, the education department of the
Russian-American Foundation for Trade Union Research and Education,
an organization FTUI created with USAID funding, has managed this
project. From 1992 through 1994, about 15 seminars and conferences
were held in about 8 cities, covering issues such as collective
bargaining, protecting workers' rights in the courts, and union
organizing. Union members we met praised FTUI educational seminars
and conferences, particularly those focusing on legal issues such as
how to favorably resolve employer-employee disputes.


OUTREACH AND INFORMATION
DISSEMINATION
------------------------------------------------------ Appendix IV:2.3

FTUI's outreach activities--funded by USAID and NED--entail frequent
trips by FTUI staff to various parts of Russia to meet union leaders,
introduce them to FTUI programs, and provide informal consultations.
According to project documents and independent union officials, these
activities resulted in the formation of cooperative relationships
between Russian unions and international confederations and in
independent unions forming regional and national confederations. For
example, FTUI staff facilitated the formation of the Confederation of
Maritime Workers, which includes the dock workers, seafarers, and
port workers unions. The confederation has a combined membership of
about 86,000.

FTUI also provides information to the public and government on union
and labor issues. For example, a labor newspaper is published by the
Prologue Society with funding from FTUI through its NED grant that
has reached a circulation of 60,000 and is distributed throughout
most of the country. Its readership includes members of the
Parliament and the Kremlin, where, according to an FTUI official,
articles from the newspaper are included in President Yeltsin's daily
news clippings. While union members we met were divided on the
usefulness of the paper's coverage, the leader of the Independent
Miners' Union said the newspaper plays a key role in his union's
media campaign.

Using USAID funds, FTUI also provides public information through the
Russian-American Foundation for Trade Union Research and Education.
The foundation has press correspondents in about 36 locations who
write articles for local papers. The foundation distributes press
releases to two Russian news agencies and reports and press clippings
on trade union activities to trade unions throughout the country. It
also uses its material on a popular radio program and a television
program.

With funding from USAID, FTUI supports the Glasnost Defense Fund in
its production of a twice weekly radio program on workers' rights and
free trade unions. The Glasnost Defense Fund is a major human rights
organization in Moscow that focuses on press freedom. The Fund
selected five large industrial cities--four in Russia and one in
Kazakhstan--to tie into a electronic mail network. However, the Fund
director told us that only a minor portion of the half hour show is
spent on worker and union issues because listeners are more
interested in other issues of local concern. He said the activity
contributes more to an independent media than to union development
because it attempts to make local broadcast stations less reliant on
central authority for material and more responsible for their own
operations.


RESEARCH
------------------------------------------------------ Appendix IV:2.4

The Russian-American Foundation for Trade Union Research and
Education initially had problems managing its research component,
though some improvements were evident by late 1994. Foundation
research is supposed to inform unions of the economic, social, and
legal aspects of the workers' movement to help unions better
represent their interests at the national and local levels. However,
FTUI officials told us that during 1993, the foundation's first year,
little research was actually done because many of the researchers
assisted the foundation's former director in trying to form a
political party, not in doing research. Moreover, FTUI officials
told us that what little research had been completed had to be edited
extensively because it was too theoretical. Nonetheless, after the
foundation's director was replaced and more of the research and
writing were done on a contract basis, a number of practical
brochures on union organizing and management were finally published.
One brochure, entitled "Legal Bases for Negotiating and Collective
Bargaining", went through two printings due to high demand. FTUI
funded these brochures and the foundation's other research activities
from its USAID grant.


LEGAL ASSISTANCE
------------------------------------------------------ Appendix IV:2.5

Using NED and USAID funds, FTUI supported two labor law centers that
have helped improve access to the legal system for trade unions and
their members. USAID's rule of law project first identified the
potential for these centers through a USAID-funded needs assessment.
In early 1994, FTUI began establishing the centers using $195,000
received from NED. In August 1994, FTUI provided about $465,000
(USAID rule of law funds) in grants to the centers to cover their
operational costs. One of the centers is part of the
Russian-American Foundation for Trade Union Research and Education in
Moscow and the other is based in Yekaterinberg.

The two centers, which together have 8 full-time lawyers,
supplemented by volunteer work from law students, successfully
litigated about half of the 50 cases they had brought to court at the
time of our review. Most of the cases involved violations of
workers' rights, such as illegal firings or breach of bargaining
agreements.

In addition to providing pro bono litigation services, the centers
support unions by participating in collective bargaining negotiations
and in the foundation's educational programs and by providing unions
with materials on legal issues. According to the State Department,
independent trade union officials were increasingly aggressive in
pressing their cases in the Russian courts during 1994, with
increasing rates of success. Union officials told us that the legal
aspects of union organizing and management was especially important,
and they praised the services provided by the FTUI-supported law
centers.


POLITICAL PARTY DEVELOPMENT
=========================================================== Appendix V

U.S.-funded political party development programs in Russia had not
significantly strengthened reformist national political parties,
either organizationally or in terms of increased membership or
performance in elections. The U.S. government has supported the
development of political parties in Russia through NED and USAID
grants to the National Democratic Institute (NDI) and the
International Republican Institute (IRI). From 1990 through 1992,
NED provided $956,000 to NDI and IRI to help the anti-Communist
Democratic Russia Movement establish a printing facility and
disseminate literature. NED's funding also enabled NDI and IRI to
conduct civic education and grassroots organizing programs for
Russians at the national and local levels. In addition, NED provided
NDI and IRI $200,000 to monitor the April 1993 national referendum
and to send Russian party leaders to the United States for training.

Beginning in 1992, USAID awarded NDI and IRI a series of grants that
totaled about $17.4 million to conduct political party development
programs in Russia through 1997. According to USAID documents, the
overall objective of these grants was to help reformist political
parties strengthen their organizational structures and their role in
elections, Parliament, and local government. The grants were also
intended to strengthen reformist parties indirectly by providing
support to civic organizations and encouraging them to work with
parties and by monitoring elections and promoting public
participation in politics. NDI and IRI held numerous seminars and
training activities for party leaders in Moscow and for activists in
over 20 cities and regions, prior to the April 1993 referendum and
the December 1993 national elections. Nonetheless, reformist
political parties performed poorly in the December 1993 elections.

In Russia's inhospitable environment for political party development,
NDI and IRI were able to develop extensive relationships with party
officials and provide training and assistance. However, despite the
institutes' work, reformist parties have been either unwilling or
unable to form broad-based coalitions or build national organizations
and large segments of the Russian public have not been receptive to
their political message.

NDI and IRI officials acknowledge that the Russian environment is
difficult for political party development; however, they believe that
their programs are important for furthering Russia's democratic
development. NDI and IRI noted that the development of a strong
multiparty system has been made more difficult by Russia's lack of
democratic traditions, the Communist party's 70-year hold on Russia
(a far longer span than in Eastern Europe), and the public's general
aversion to any organization characterized as a "party." While NDI
and IRI officials agreed that the environment is less than conducive
to reform, they do not see this as a reason not to pursue political
party development.

In commenting on this report, USAID agreed that strengthening Russian
political parties has been difficult. It said that consequently,
since 1994 it has attempted to focus NDI's and IRI's programs by
exclusively targeting them on six cities each.\1

USAID believes that these targeted programs are having greater impact
than earlier national efforts.

USAID officials cautioned that expectations should not be too high
and that its assistance would likely have only a minimal impact on
the performance of the democratic parties during the December 1995
parliamentary election and the June 1996 presidential election. In
early 1995, USAID foresaw a poor electoral showing by the reformist
parties in Russia in the upcoming parliamentary and presidential
elections and counseled NDI and IRI to direct more of their resources
to working with grassroots nongovernmental organizations, thereby
supporting the overall shift of the U.S. democracy program to
developing a democratic civil society.


--------------------
\1 In its response to our draft report, IRI said that its programs
are targeting nine cities.


REFORMIST PARTIES DID POORLY IN
DECEMBER 1993 ELECTIONS
--------------------------------------------------------- Appendix V:1

From 1991 through 1993, NDI and IRI held multiparty seminars and
single-party consultations throughout Russia. These seminars
provided information on party organization and campaign techniques,
and participants were given training videos and reference materials
on U.S. parties and campaigns. For example, from late 1991 (with
NED funding) and through 1992 and 1993 (with AID funding), IRI
conducted party training in 19 cities from northern and western
Russia to eastern Siberia. NDI provided training for the day-to-day
organizers and managers of democratic political parties in Moscow and
the regions.

Despite these efforts, the December 1993 parliamentary elections,
called just months after a violent standoff between President Yeltsin
and Parliament, proved to be a disappointment for democratic and
reformist parties.\2 In the State Duma, the lower house of the
Parliament, the Liberal Democratic Party of Vladimir Zhironovsky
(which is neither liberal nor democratic) did best with 23 percent of
the popular vote, and Russia's Choice, the liberal reformist bloc
headed by former prime minister Yegor Gaidar and nominally allied
with President Yeltsin, was second with only 16 percent. In total,
nationalist and Communist blocs won a plurality and outpolled
proreformist blocs by 9 percent. Although Russia's Choice gained the
most seats of any party\3 (66 party list and single mandate seats),
reformist parties as a group won only 112 seats, not enough to
control the 450-seat State Duma.

Election observers cite a variety of reasons for the poor showing of
the reformist parties. These parties had been declining in cohesion
since the breakup of the Soviet Union in August 1991, principally
because President Yeltsin postponed calling elections for a new
Russian Parliament, leaving intact the Parliament that had been
elected in 1990 during the Soviet-era. Without elections to focus
their activities, Democratic Russia and other groups that had played
such a large role in the collapse of communism failed to take the
steps necessary for transitioning from opposition movements into
political parties that could succeed at the ballot box. Democratic
groups also declined in popularity from 1991 through 1993, as they
were associated with the economic hardship being experienced.
Consequently, the successors to the Communist party of the Soviet
Union, the Communist and Agrarian Parties of Russia, staged somewhat
of a resurgence. Numerous far-right, nationalist movements, such as
the Liberal Democratic Party, also increased their organizational and
popular strength during this difficult period of economic and social
transition.

According to numerous observers, the reformist parties made many
strategic and tactical errors during the December 1993 elections,
thereby compounding their weaknesses. For example, although Russia's
Choice ran with the Democratic Russia Movement, the reformists still
ran as four separate parties or blocs, thereby splitting their votes.
Also, notwithstanding NDI's and IRI's efforts, these parties pursued
a Moscow-focused campaign strategy. They failed to reach out to or
build regional organizations and to present clear, convincing
campaign messages.


--------------------
\2 This conclusion and the following discussion are derived from (1)
our discussions with U.S. and Russian officials and political
activists; (2) "Russian Politics: The Calm Before the Storm,"
Michael McFaul, Current History, October 1994; and (3) "Background
Memo on Russian Politics," prepared by the International Republican
Institute, June 1994.

\3 The largest group of candidates elected were not affiliated with
any political party. Independent candidates won 127 seats in the
State Duma.


REFORMIST PARTIES REMAIN WEAK
--------------------------------------------------------- Appendix V:2

Since the 1993 national elections, NDI and IRI have continued working
with party activists throughout the country, encouraging the
formation of coalitions and teaching organizational and campaign
techniques. However, the situation for reformist parties since the
December 1993 elections has only marginally improved. Some of
them--such as Russia's Choice, Yabloko, and the Party of Russian
Unity and Accord (PRES), all participants in NDI and IRI
programs--now recognize the need and have taken some steps to build
national organizations. However, according to U.S. and Russian
officials, these reformist parties' organizational presence outside
of Moscow remains weak, and they did not made significant gains in
local elections that took place across Russia over the last 18
months. They remain Moscow-centered, highly fractionalized, and
separated more by personal ambition than ideology.

NDI and IRI officials acknowledged that reformist parties have
remained weak, but they said that the institutes' training programs
since 1993 have increased the organizational capacity of some
parties. An IRI official said that during 1994 and 1995 it trained
about 3,000 party activists, many of whom returned for advanced
training. This official told us that IRI's approach has been to help
those Russians begin to build democratic parties up from the grass
roots, the necessary ingredient for a strong national organization.
He said that Russia's reformist parties have persisted in their
efforts to build their organizations and field candidates despite the
unpopularity of their free market message and historical negative
view of "party" (a harsh memory from the days of Communist party
control).

According to an NDI official, in 1995 NDI observed markedly different
behavior among parties with which it was working. NDI observed that
the parties were targeting communication to voters based on
demographic and geographic information from the previous elections;
conducting research on voter attitudes through focus groups and
polling; contacting voters through small meetings, coalitions with
civic groups, door knocking, and leaflets; and relying on party
activists who considered party organizing their full-time job. NDI
also said that although a formal democratic coalition had not emerged
for the December 1995 elections, there had been considerable
coordination of candidates in single-member districts. NDI
attributed this coalition building to its round table discussions on
cooperation held in December 1994 and April 1995. NDI noted that
coalition members in one city pledged to nominate one joint candidate
in each single-member district for the December 1995 parliamentary
elections.

Evidence, however, suggests that successful coalition building has
not taken place at the national level. For example, due to
personality conflicts, the two large pro-reform election blocs of
1993, Yabloko and Russia's Choice, had split into 11 different
parties and movements by the December 1995 parliamentary elections.


RUSSIAN AND U.S. VIEWS ON
POLITICAL PARTY ASSISTANCE
--------------------------------------------------------- Appendix V:3

According to many Russian political activists and some U.S.
officials, political party training will ultimately affect the
development of Russia's political parties only at the margins. The
Russian political activists said that viable reformist political
parties may only emerge after more than a decade, and their
development will depend mostly on efforts to build a democratic civil
society. That is, even if NDI and IRI can teach reformist parties
how to campaign and organize effectively, they will only win
elections when the Russian people are receptive to a reformist,
democratic political message. U.S. officials said that the program
can have an impact, although the impact will be narrow in scope due
to the size and complexity of Russia and its politics. According to
these officials, IRI and NDI projects are not expected to
significantly influence the development of national political parties
in Russia.

According to NDI and IRI, although their party development programs
are likely to affect Russia only at the margins, their services are
in high demand and they do have a visible impact on numerous
individual party officials or candidates who use their advice.
Despite the difficult environment for political party development,
NDI and IRI have developed contacts with thousands of democratic
activists throughout Russia, regularly holding seminars and
consultations and providing information and other materials.
Numerous Russian officials and activists in several cities who had
participated in NDI and IRI programs praised NDI and IRI training for
increasing their knowledge of campaign techniques, bringing reformist
parties together, and encouraging people who had never participated
in politics to become political activists and candidates. They also
said that NDI and IRI written materials were an effective means of
communicating practical experience and that they wanted more, rather
than less, assistance. Among these officials and activists were
leaders of Russia's Choice and the Social Democratic party, State
Duma deputies from reformist parties, and an official at the Kremlin
responsible for parliamentary affairs.

Nonetheless, NDI and IRI have had mixed results in getting Russians
to use their campaign techniques. Some Russian political activists
cited examples of how they could adapt certain techniques to their
campaigns; for example, one candidate told us that he followed NDI's
suggestion and developed a political map to target his campaign
literature to people most likely to vote for him. Senior IRI and NDI
officials stressed that their techniques are being used in Russia.
They cited as examples reformists who won elections using local phone
banks and door-to-door canvassing, despite initial reluctance by
some.

Many Russian political activists, however, told us that the training
was not always applicable to Russia. For example, they said that
some U.S. political or campaign practices such as phone banks and
door-to-door canvassing cannot be fully used or were unsuccessful in
Russia because of technological and cultural factors. An IRI
official in Russia told us that he realized some U.S.-style campaign
techniques would not work in Russia and that he was working to make
IRI activities more relevant to the Russian context.


CIVIC EDUCATION
------------------------------------------------------- Appendix V:3.1

A number of participants in NDI's and IRI's political party and civic
advocacy programs indicated that to better promote democracy in
Russia, the United States should support more civic education
activities. The political party participants spoke favorably of U.S.
support for sending Russians to the United States for training but
said that NDI, IRI, or other U.S. nongovernmental organizations
could work at schools or other Russian institutions to teach Russians
the principals of self-government, the responsibilities of
citizenship, and the benefits of democracy in general. Such efforts
may convince Russians to support reformist parties' message,
complementing ongoing NDI and IRI efforts to improve organization and
campaign techniques of these parties.

Further, many participants told us that NDI's and IRI's civic
advocacy seminars provided them with information on creating
coalitions of civic organizations and attracting people, particularly
women, to social movements that could influence government. However,
they also told us that the United States could better support civic
groups by helping them address issues of broader social concern such
as crime, drugs in school, and women's unemployment.

According to IRI officials, the goal of IRI's civic advocacy program
is to help these groups see the importance of being involved in the
political process. However, while IRI sponsors political events such
as candidate debates or women-in-politics seminars, it does not
sponsor events on local civic issues such as crime or drugs in
school. According to IRI, an indicator of its success in the civic
advocacy area is that many of its trainees become candidates for
national and local offices. For example, following a February 1994
women-in-politics seminar, four women decided to run for the City
Duma in their home town--three won.

NDI officials told us that their civic advocacy programs have
promoted coalitions among civic groups and enhanced communication
between these groups and political parties and local governments.
For example, in preparation for the December 1995 parliamentary
elections, NDI conducted programs in Moscow, St. Petersburg,
Yekaterinberg, and Nizhnii Novgorod on ways that civic groups could
voice their interests, such as through sponsoring candidate forums
and debates, distributing candidate questionnaires, and providing
volunteers and resources to campaigns. For purposes of our review,
however, we included these activities as political party development.
We were told by Russian political activists that many organizations
participating in these civic advocacy programs served as political
bases/organizations for local politicians who were running for
office, not as traditional civic organizations. According to one of
these activists, he decided to use civic organizations as a political
base when he saw that the Russian public has an "allergy" to any
organization characterized as a "party."\4

According to USAID officials in Moscow, civic education in schools is
the one area where the USAID democracy portfolio is lacking but such
a program would be very costly or too diffuse in a country as large
as Russia and could offend Russian nationalist sensitivities.
Instead, USAID is funding informal civic education activities through
nongovernmental organizations. For example, from June 1993 through
July 1995 the Eurasia Foundation, a USAID grantee, provided about 100
small grants to U.S. and Russian nongovernmental organizations in
the areas of legal reform, conflict resolution, democratic
institution building/civic education, and nongovernmental
organization development. In addition, USAID is encouraging NDI and
IRI to place less emphasis on their party training programs and more
on their work with civic organizations. USAID has also started a
$5.5 million project that provides funds for the institutional
development of Russian nongovernmental organizations.

NED and one of its core institutes, the Center for International
Private Enterprise, are also funding informal, and to a lesser extent
formal, civic education activities. From fiscal years 1990 through
1994, almost all of NED's discretionary grants funded nongovernmental
organizations in the areas of human rights, civic education, public
advocacy, and independent media. For example, in 1994, NED sponsored
an international conference in Russia on civic education and
financially supported the publication of weekly articles for civics
instructors in a leading Russian teachers' newspaper. The Center for
International Private Enterprise also gave a small grant that was
used to develop a civic textbook on economic and democratic reform.


--------------------
\4 NDI officials told us that their civic advocacy program included
many types of civic organizations, ranging from those that serve
primarily as a political base for politicians to those that are
traditional civic organizations. However, they could not identify
how much of their resources go toward supporting traditional civic
organizations.


RULE OF LAW
========================================================== Appendix VI

U.S.-funded rule of law activities conducted under the Democratic
Pluralism Initiative\1

thus far have had a limited impact on reforming Russia's legal and
judicial institutions and are only beginning to help build a
grassroots constituency for legal reform. Through grants to the
State Department and the American Bar Association, USAID supported
Russia's limited reintroduction of jury trials and its first steps
toward establishing an independent judiciary.

In September 1993, USAID awarded a $12.2 million, comprehensive rule
of law contract to ARD/Checchi. This contract was designed to
continue these efforts in Russia over a 3-year period,\2 and expand
them to strengthen the laws, legal structures, and civic
organizations that provide the necessary operating framework for
democratic, market-oriented societies. Specifically, ARD/Checchi
provided funds for an assessment of Russian legal needs and used this
information to develop an action plan for USAID's rule of law
project. ARD/Checchi also designed and started to implement
activities that would support the development of Russia's legal
institutions, and it awarded subcontracts and subgrants to
nongovernmental organizations for voter education prior to the
December 1993 elections, legal assistance for trade unions, and the
development of civic organizations. This project's core program was
not implemented for about a year due to problems related to the
process of designing the program and poor contractor performance.


--------------------
\1 USAID's project dealing with commercial law reform, the IRIS
project, was not included in our review.

\2 This contract includes an option for extending the contract for 2
more years at an additional cost of $9.945 million.


SUPPORT FOR JURY TRIALS AND AN
INDEPENDENT JUDICIARY
-------------------------------------------------------- Appendix VI:1

Two USAID funded projects contributed to incremental changes in the
Russian criminal justice system and judicial institutions from 1992
through 1994. With USAID funding, the State Department and the
American Bar Association implemented two small projects that were
designed to help increase the independence of the judiciary and
support Russia's reintroduction of jury trials. The reintroduction
of jury trials in Russia is a major reform initiative, both
substantively and symbolically. Russian legal reformers hoped that
the reintroduction of jury trials would lead to a more open and fair
adversarial courtroom procedure. Jury trials would replace the
Soviet-style system in which, according to State Department human
rights reports, criminal procedures are still weighted heavily in
favor of the prosecution, and defendants are expected to prove their
innocence rather than the prosecutors prove their guilt.

Beginning in May 1992, the U.S. embassy's political office used
USAID funds to support a Russian-sponsored jury trial initiative and
establish contacts with Russian legal reformers. Under two
agreements with USAID, the State Department received $200,000 for
rule-of-law activities in Russia. Using these funds, the U.S.
embassy's political office provided funds for seminars, including one
held in 1994 at which U.S. and Russian experts evaluated the
preliminary results of the jury trial initiative and discussed future
steps in U.S.-Russian cooperation. The office also provided travel
funds for experts who would design publicity materials associated
with jury trials and the new Russian constitution.

According to USAID officials, the State Department's small project
was not designed to be long running or sustainable. Instead, it was
designed to act as a bridge and establish contacts for a larger USAID
project. USAID officials told us that the early years of State's
project were very successful but that the activity was no longer
needed. USAID stopped funding this activity in March 1995.

Beginning in mid-1992, the American Bar Association provided
technical assistance for Russia's judicial restructuring and
reintroduction of jury trials. The American Bar Association operated
under a 2-year regional grant that totaled about $3.2 million, of
which about $950,000 was used for assistance to Russia. Activities
included holding three training workshops, held in Russia and
Washington, D.C., that covered judicial restructuring, constitutional
reform, and jury trial advocacy for criminal defense attorneys;
providing immediate assistance in circulating and commenting on 12
draft laws within the United States, including the draft labor code,
draft constitution, and draft law on state support of small business;
giving equipment to Russian legal institutions; hosting exchange
visits between Russian and American judges; and developing a bench
book to guide judges during jury trials.

By the end of 1994, jury trials were operating in 9 of 89 regions in
Russia,\3 and the government had enacted legislation intended to
increase the independence of the judiciary. However, although the
former Supreme Soviet and the present Parliament, with the active
encouragement of the President's staff, enacted many legal reforms
through 1994, both the Russian and regional governments did not
adequately fund their implementation. As a result, the widespread
reintroduction of adversarial trials with juries was not occurring as
scheduled because many court rooms had not been renovated, many
judges had not received necessary training, and funds were not
available to pay for jurors' stipends. Despite the government's
long-term efforts to reform the judiciary, at the end of 1994 judges
were just beginning to assert their independence from other branches
of government.

By September 1995, expansion of the jury trial initiative or further
improvements in the criminal justice system appeared to have minimal
support from the Russian government. According to the State
Department's human rights report, the limited progress that Russia
had made was undercut by two decrees issued by the President of the
Russian Federation in June 1994. In his desire to combat increasing
crime, President Yeltsin signed two decrees that contradicted
constitutional rights to protection against arbitrary arrest and
illegal search, seizure, and detention.\4 Further, according to a
USAID official, the Russian government did not fund the expansion of
jury trials to the planned five additional regions. Moreover, the
Russian government official that was pushing reforms in the criminal
justice system left the government in late summer of 1995.


--------------------
\3 In the 80 regions without jury trials, criminal cases at the
district and regional court levels were tried by a panel consisting
of 1 judge and 2 lay assessors. In these 80 regions, criminal
procedures were those under the Soviet-style system.

\4 The decrees gave law enforcement authorities power to detain
suspects without charge and without access to a lawyer for 30 days,
and to conduct warrantless searches and seizures.


LIMITED SUPPORT THUS FAR FOR
OTHER RUSSIAN LEGAL
INSTITUTIONS
-------------------------------------------------------- Appendix VI:2

Although the ARD/Checchi contract funded many projects, its primary
focus was to strengthen core Russian legal institutions. The
contract was to include judicial training programs; law school
support, including adding commercial law courses and new substantive
and procedural code reforms into the curriculum; legal information
programs; public and professional legal education; support for the
Constitutional Court; and training for the procuracy, which in Russia
includes the functions of prosecutor, investigator, attorney general,
ombudsman, and consumer affairs. ARD/Checchi was also to have
assumed primary responsibility for supporting the reintroduction of
jury trials.

Our review showed that the contractor's efforts in these core areas
had little impact during the first year because of problems related
to the interagency approval process for the contractor's work plan,
the complexity and enormity of the contractor's tasks, and poor
contractor performance. ARD/Checchi took about a year to start
implementing its core legal reform activities as finally approved by
the USAID mission. ARD/Checchi required several attempts to draft an
action plan that was acceptable to USAID and the U.S. embassy
interagency working group on the rule of law. According to a USAID
official, the interagency working group contributed to the delay as
it did not have a clear idea of what it expected from ARD/Checchi.

ARD/Checchi's progress was further slowed by its organizational and
personnel problems and unfamiliarity with USAID's contract,
procurement, and program requirements. According to USAID officials,
ARD/Checchi's assessment team did an excellent job analyzing Russia's
legal situation and identifying key institutions and officials;
however, the contractor was ineffective in translating that
information into deliverable assistance during the first year.

The ARD/Checchi project was also hampered by limited support from the
USAID mission in Moscow, which was struggling to implement the entire
Russian assistance program and was preoccupied with the December 1993
parliamentary elections. According to USAID officials, the mission
was understaffed during the initial program phase and had little
technical expertise to manage such a complex contract. Thus,
ARD/Checchi, as well as other contractors, was largely left to its
own devices to implement its projects. USAID officials told us that
during the first year, USAID was preoccupied with assisting the
Russian State Duma on commercial law activities and trying to manage
the approximately 200 contractors and grantees starting work on USAID
programs. As a result, USAID was unable to provide effective
oversight and assistance to the contractors at the start of the
projects.

A complicating factor for the rule of law program in general, and
ARD/Checchi in particular, was the need to forge working
relationships with Russia's historically closed legal institutions.
Although the U.S. embassy's political office had established
contacts within the presidential administration, ARD/Checchi spent
most of its time during its first year establishing contacts with
other legal institutions such as the Academy of Jurisprudence, the
Supreme Commercial Court, the Procuracy Training Institute, state law
academies, leading Russian law schools, and the Constitutional Court.
ARD/Checchi officials told us that identifying the key administrators
and reformers and establishing effective working relationships within
institutions was a complex and time-consuming task. Further,
according to a USAID official, ARD/Checchi spent a good deal of time
negotiating subcontracts with organizations unfamiliar with having a
subcontractor relationship with USAID.

The USAID mission in Moscow attributed the delay in developing an
action plan to (1) the preoccupation of government counterparts
during the government crisis during the fall of 1993, (2) the
difficulty in designing programs for nonreformed Russian government
institutions, and (3) the lack of experience of ARD/Checchi's first
chief of party in project management. The USAID mission believes
that the interagency approval process did not contribute to delays in
the project.

We noted a significant increase in activity under ARD/Checchi's work
plan starting in the last quarter of 1994 through the first half of
1995. After a change in the management of ARD/Checchi's Moscow
office management in late 1994, ARD/Checchi began to provide training
programs, equipment, and reference materials to Russia's core legal
institutions. For example, it provided

training to Supreme Commercial Court senior faculty by faculty of
the National Judicial College in Nevada;

case management and computer training, reference materials, and
equipment to the Commercial Court to meet its expanding
caseload;

training programs on bench trials and judicial ethics;

curriculum expansion, information system modernization, and trial
advocacy workshops at Russia's first rank law schools;

training and computer hardware and software to the St. Petersburg
State University Law Faculty in the use of legal database and
electronic mail to promote the flow of legal information to the
legal community;

educational films for judges, jurors, and the public on jury trials
and the construction of a mock court room for the training of
judges from general jurisdiction courts; and

training programs for senior level trainers and teaching equipment
upgrades at the Procuracy Training Institute.

In August 1994, USAID awarded the American Bar Association a $2.5
million, 2-year grant, of which $700,000 is budgeted for its project
in Russia. Under this grant, the bar association is assisting
Russian lawyers' associations in strengthening their institutions,
establishing new associations, and developing continuing legal
education programs.

It is too soon to evaluate the effectiveness of ARD/Checchi's core
legal reform efforts and the latest American Bar Association project
since they had only started in late 1994 and early 1995. However,
USAID, State Department, and Russian government officials told us
that systemic changes in Russia's legal institutions will be a
long-term process.


ASSISTANCE TO CIVIC
ORGANIZATIONS
-------------------------------------------------------- Appendix VI:3

ARD/Checchi's contract also included a component designed to
encourage grassroots efforts to promote the rule of law. In early
1995, ARD/Checchi started a $2-million small grants program, which
will provide small grants to Russian organizations and their U.S.
partner organizations that are pursuing legal reform or providing
legal services. ARD/Checchi had not awarded any small grants at the
time of our fieldwork in Russia, but in March 1995, ARD/Checchi
awarded five grants (totaling $475,000) in the areas of environmental
law, community legal assistance and legal education, tax law reform,
women's rights, and freedom of information.

Further, as part of its USAID-funded needs assessment for the rule of
law area, ARD/Checchi identified the potential and recommended the
funding for a legal assistance/workers' rights project. In August
1994, ARD/Checchi awarded a subcontract of about $465,000 to the Free
Trade Union Institute for this project.\5

Through this subcontract, USAID's rule of law project has financially
supported increasingly effective efforts to address workers' rights
issues through Russia's court system. (See app. IV for more
information on this project.)

USAID, through the Eurasia Foundation and a nongovernmental
development project, and NED have also provided grants to human
rights and other nongovernmental organizations. These grants
directly and indirectly contribute to the rule of law program by
developing long term relationships with Russian grassroots
organizations that are working to increase transparency and
accountability in government and influence the reform process by
safeguarding human rights and the right to political dissent.


--------------------
\5 FTUI used NED funding for limited project activities before
signing the USAID subcontract.


CIVIL-MILITARY RELATIONS
========================================================= Appendix VII

U.S. assistance to strengthen civilian control of the Russian
military has included the International Military Education and
Training (IMET) program and a USAID grant to the Atlantic Council.
Neither program has had much impact, primarily because they have not
affected significant numbers of Russian decisionmakers due to a lack
of interest by the Russian government.

U.S. embassy officials told us that the Russian military, rather
than civilians, has retained firm control of its sphere of
operations. One official said that the Russian Parliament has
limited detailed knowledge of the military budget and has to rely on
the intelligence services to learn information of military
activities. Similarly, uniformed officials are predominant at the
Russian Ministry of Defense. The U.S. embassy officials said that
political circumstances in Russia make the implementation of a U.S.
civil-military program in Russia very difficult. Some quarters of
the government are generally reluctant to accept Western assistance
and suspect that civil-military assistance is designed to further
weaken Russia militarily. Additionally, the need for deep cuts in
defense spending renders the process of greater civilian control in
the Ministry of Defense more complex, as significant hiring of
civilian employees is unlikely, especially in light of large numbers
of unemployed military personnel.


IMET PROGRAM
------------------------------------------------------- Appendix VII:1

In June 1992, the Department of Defense (DOD) began implementing an
IMET program in Russia, a program which is jointly managed by the
State Department and DOD.\1 The IMET program is a world wide grant
training program that, among other objectives, seeks to promote
military rapport between the United States and foreign countries and
promote better understanding of the United States, including its
people, political system, and institutions. In Russia, the program
aims to foster a stable, cooperative relationship between U.S. and
Russian armed forces and provide expertise to guide the military's
transition under a democratically elected government. Under the
Expanded-IMET component, the program also seeks to promote civilian
control of the military and democratic orientation of the military
along Western lines.\2

Funding for the IMET program in Russia has grown from $153,000 in
fiscal year 1992 to $471,000 in fiscal year 1994. According to a DOD
official, about one-third of the total for these years was spent on
Expanded IMET courses. From 1992 through 1994, according to
information provided by the U.S. embassy, the IMET program for
Russia brought 18 mid- and senior-level military officers from the
Ministry of Defense and 19 civilian officials, primarily from the
Ministry of Foreign Affairs, to the United States for education,
training, and observation tours.\3 The military officers generally
attended mid- and senior-level military colleges or participated in
observation tours, and all but one civilian official attended defense
resource management courses in Monterey, California.

According to U.S. embassy and DOD officials, Russia's Ministry of
Defense has not fully used the IMET program since 1993, sending few
military officers to the United States for training in 1994. The
ministry generally will not allow any Russian officer to study at a
given location alone, which limits Russia's participation at U.S.
military colleges. According to a DOD official, the Secretary of
Defense recently encouraged the Russian Minister of Defense to
increase Russia's military participation in the IMET program, but the
Russian government has not responded to this encouragement.

According to an IMET program document, the Ministry of Foreign
Affairs has shown much greater support for the IMET program.
However, according to a U.S. embassy official who manages the
program, the ministry thus far appears to have nominated civilian
candidates who are chiefly mid-level bureaucrats and not likely to
advance to positions of authority.

An embassy official told us that it is too early to determine whether
the IMET program is successful and that the embassy views the program
as a long-term effort that may not yield results for 10 to 20 years.
In commenting on this report, the State Department stated that there
has not been enough time to track the careers of civilians who
participated in the expanded IMET program, and DOD also emphasized
that the IMET program is a long-term effort. DOD said that the IMET
program has not had sufficient time to make an impact. We agree with
DOD that the IMET program is a long-term effort; however, we assessed
the progress that had been made in identifying and selecting
promising officers who are likely to rise to positions of prominence.
We found that the major factor inhibiting this process was the
unwillingness of the Russian government to fully use the IMET
program.


--------------------
\1 The Secretary of State is responsible for the program's general
direction, recommends funding levels for congressional approval, and
allocates approved funds to each country. The Secretary of Defense
is responsible for planning and implementing the program, including
administration and monitoring, within established funding levels.

\2 The IMET program provides instruction and training in military
skills and U.S. military doctrine to foreign military and related
civilian personnel on a grant basis. The Expanded-IMET component
offers courses in such areas as defense resource management, military
justice, civil-military cooperation, and human rights.

\3 According to DOD, the numbers of IMET participants provided by the
Defense Security Assistance Agency and published in the annual
Congressional Presentation Document are gathered indirectly and may
vary somewhat from the numbers provided by the embassy. DOD said
that the embassy provides the more accurate participant count.


ATLANTIC COUNCIL PROGRAM
LIMITED
------------------------------------------------------- Appendix VII:2

The Atlantic Council received a 2-year $626,500 grant from USAID in
1992 for a civil-military relations project.\4 The project's goal was
to encourage the integration of the Russian military establishment
into society, opening it up to greater supervision from, and closer
working relationships with, democratically elected civilian
leadership of the executive and legislative branches and with the
press and public at large. The council intended to conduct a series
of training seminars in both Russia and the United States. According
to a USAID-funded evaluation, the program suffered delays from the
outset and failed to fulfill its planned activities due to poor
planning, lack of in-country staff to process potential participants,
tight timelines, and an underestimation of Russian political
sensitivities.

During the first year of the grant, the council conducted a 2-day
seminar in Russia on the U.S. defense budget process. In the second
year, the council sponsored or cosponsored four seminars in Russia,
including (1) a journalism seminar on covering defense issues in a
democratic society, which was cosponsored with the Russian-American
Press and Information Center and attended by journalists from Russia,
Ukraine, and Belarus and (2) seminars on national security
decision-making, civil-military relations, and the Partnership for
Peace program for Russian government officials.



(See figure in printed edition.)Appendix VIII

--------------------
\4 This project covered Russia and the Ukraine.


COMMENTS FROM THE DEPARTMENT OF
STATE
========================================================= Appendix VII



(See figure in printed edition.)




(See figure in printed edition.)Appendix IX
COMMENTS FROM THE DEFENSE SECURITY
ASSISTANCE AGENCY
========================================================= Appendix VII



(See figure in printed edition.)




(See figure in printed edition.)Appendix X
COMMENTS FROM THE U.S. AGENCY FOR
INTERNATIONAL DEVELOPMENT
========================================================= Appendix VII


The following are GAO's comments on USAID's letter dated December 7,
1995.

GAO'S COMMENT

1. The agency's suggested technical corrections have been
incorporated in the report where appropriate.




(See figure in printed edition.)Appendix XI
COMMENTS FROM THE UNITED STATES
INFORMATION AGENCY
========================================================= Appendix VII



(See figure in printed edition.)


The following are GAO's comments on USIA's letter dated December 6,
1995.

GAO'S COMMENTS

1. The agency had not provided these figures as of February 14,
1996.

2. As stated in our draft report, we did not review the
effectiveness of democracy-related USIA and USAID exchange and
visitor programs due to the difficult and time-consuming task of
locating individual program participants.

3. Our report presents the cost and results of this project.

4. USIA's Bureau of Broadcasting was outside the scope of our
review.




(See figure in printed edition.)Appendix XII
COMMENTS FROM THE NATIONAL
ENDOWMENT FOR DEMOCRACY
========================================================= Appendix VII



(See figure in printed edition.)


The following are GAO's comments on NED's letter dated November 28,
1995.

GAO'S COMMENTS

1. The primary focus of the center's projects was to promote
privatization and market reform, two areas outside the scope of our
review.

2. Technical corrections and wording changes offered by NED were
incorporated in the report text where appropriate.




(See figure in printed edition.)Appendix XIII
COMMENTS FROM THE INTERNATIONAL
REPUBLICAN INSTITUTE
========================================================= Appendix VII



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


The following are GAO's comments on IRI's letter dated November 22,
1995.

GAO'S COMMENTS

1. We visited seven cities in Russia, including two of IRI's target
cities
(St. Petersburg and Novosibirsk). In Moscow and other cities, we
met with political activists who had attended programs in other IRI
target cities as well.

2. IRI examples have been incorporated into the report. However,
while IRI's efforts may have helped some candidates win in local
elections, its project thus far has been unsuccessful at its primary
objective of developing reformist political parties. In contesting
the 1995 parliamentary elections, the reformist parties again failed
to form either a national coalition or national party structures.

3. IRI examples have been incorporated into the report. At best,
however, IRI has had mixed results in getting Russians to use its
campaign techniques.

4. We have deleted from our report the discussion on IRI's efforts
to make its program sustainable.

5. During our discussion with CEC officials, including the Vice
Chairman, they did not mention IRI's observer report as making a
significant contribution to improving Russia's election law.

6. We have modified the report to reflect IRI's interpretation that
its program will have an impact at the margins.




(See figure in printed edition.)Appendix XIV
COMMENTS FROM THE NATIONAL
DEMOCRATIC INSTITUTE FOR
INTERNATIONAL AFFAIRS
========================================================= Appendix VII



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


The following are GAO's comments on NDI's letter dated November 27,
1995.

GAO'S COMMENTS

1. The report has been modified based on updated USAID financial
information.

2. The draft report stated that the $200,000 was for election
monitoring and sending Russian party leaders to the United States for
training.

3. NDI examples have been incorporated into the report. At best,
however, NDI has had mixed results in getting Russians to use its
campaign techniques.

4. Despite these coordination efforts, the evidence obtained during
our review suggests that successful coalition building had not taken
place at the national level. For example, due to personality
conflicts, two of the largest proreform political parties, Yabloko
and Russia's Choice, had split into 11 different parties and
movements by the December 1995 parliamentary elections.

5. The result of this training, when measured against performance of
democratic reformist parties during the 1995 parliamentary elections,
must be considered a major disappointment. Reformist political
parties neither formed a national coalition or a national party
structure. In addition, reformist parties apparently did not benefit
from NDI's training. For example, the Democratic Choice of
Russia--the leading proreform party in the 1993 election and an NDI
client--failed to reach the 5 percent threshold for gaining party
representation in the Parliament and the 1993 election in the State
Duma.

6. Many organizations participating in the civic advocacy programs
actually serve as a political base/organization for local politicians
who are running for office, rather than as traditional civic
organizations. Thus, we continue to view these programs as political
party development.

7. While interest in political party training continues to exist,
the effectiveness of such training in the current political
environment is questionable. Many Russian political activists took
the longer term view that civic education would make a more important
contribution to promoting democracy in Russia.

8. Although the outcome of elections should not be held as the sole
indicator, it is one indicator to assess the impact of political
party development assistance. Unless parties are successful at
increasing political representation, they are unlikely to attract the
necessary financial and public support to grow and prosper.

9. In measuring party development, we believe it is appropriate to
emphasize party performance over individual candidate performance.
Moreover, in the December 1995 parliamentary elections, the
performance of reformist parties at both the party and individual
level was again disappointing.

10. We have modified the report to reflect NDI's interpretation that
its program will have an impact "on the margins."

11. We have deleted from our report the discussion on NDI's efforts
to make its program sustainable.


MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix XV

NATIONAL SECURITY AND
INTERNATIONAL AFFAIRS DIVISION,
WASHINGTON, D.C.

Louis H. Zanardi
Judith A. McCloskey
Patrick A. Dickriede
Todd M. Appel
Jose M. Pena, III
*** End of document. ***


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