The Siberian Curse: How Communist Planners Left Russia Out in the Cold
Everyone knows that Russia is big and cold. Hill and Gaddy argue that Russians, during the Soviet era especially, have treated the first condition as an advantage and the second as surmountable -- and that in both respects, they are deeply mistaken. Distance and temperature, they argue well with ample data to back them up, have been critical drags on Russia's economic development. Efforts to populate and industrialize the frozen reaches of Siberia have always been economic folly. If Russia is to escape the past, it must, as Canada, Sweden, Finland, and Norway have, concentrate people and activity in large urban areas in the country's warmer regions: Europe should be its target market, fifteenth-century Muscovy its heartland, and Siberia a commodity-producing hinterland (as is northern Canada). How is this to be accomplished? Make other cities livable, not just Moscow and St. Petersburg; rethink internal migration policy; reverse the development strategy for Siberia; and economically link the Russian Far East with Northeast Asia.
Related
Ukraine has yet to solve the challenge of life after communism. Hyperinflation is just a memory and democracy is well entrenched, but production is declining, state industries remain unsold, and investors have largely stayed away. With nationalists ascendant in Russia, Ukraine needs Western money and diplomatic backing to preserve its independence and keep reform on track. A free, democratic Ukraine can serve as a model for Russia, prevent a new Soviet Union, and promote stability among its neighbors. A civil war between its Russified east and its more Ukrainian west, or its absorption into a new Russian empire, would reverberate throughout Europe.
The Caspian basin holds enormous oil and gas deposits that could play a critical role in the world's economic future. But getting them out of the ground and onto the market requires overcoming formidable political and geographic problems. For its own sake as well as the region's, Washington should do whatever is necessary to ensure the emergence of secure and independent routes for Caspian energy to reach the outside world.
Russia's era of romantic democracy is over. Boris Yeltsin's victory in the 1996 elections marked the rise of a new class of oligarchs who have profited from post-Cold War chaos. But Westerners who predict a return to authoritarianism and cultural stagnation overlook how far Russia has come since the late 1980s, and how it has opened to the world. It is not the Soviet Union, nor the land of the czars. In the short term, most Russians cannot hope for much, especially from their leaders. But with its political reforms, 98 percent privatized economy, and educated, urban population, Russia has a great deal going for it-maybe more than China.

Sign-up for free weekly updates from ForeignAffairs.com.