A Whiff of the Abyss

I was in Paris during the Cuban Missile Crisis. So seemingly solid, all the beautiful buildings could be gone in a matter of minutes. The same was true for all of us. It was the first and only time I had ever caught a whiff of the abyss -- until October 2008.

We survived the Cuban crisis, of course, and no doubt we'll get through the current financial and economic crises as well. Crises usually teach the same lessons -- preparedness pays and leaderships matters. The homely virtues of prudence and cooperation are more important than flashy heroics.

For Russia, the fluctuations in oil prices have a paradoxical effect on the country. When prices are sky-high, the main problem seems to be how to rake in all the money. Yet it is those same sky-high prices that generate investment in developing the alternative energy sources that are a direct threat to any petroleum-based economy.

The flip side of this paradox is that when oil falls below $70 per barrel, the country's budget can no longer be balanced and deficits begin accruing. Yet it is precisely the falling price of oil that takes the edge off the urgency to find alternative fuels. And that not only keeps the world trapped in its old patterns of usage, it deprives the Russian economy of the incentive to diversify.

One of the few serious attempts at diversification is the country's nanotechnology project. It is headed up by Anatoly Chubais, who estimates Russia's nanotechnology sales will reach $40 billion by 2015.

In addition to the drop in oil prices, there are other troubling signs. The spectacle of Russia's richest man, Oleg Deripaska, failing to meet margin calls and needing government bailouts hardly sends a signal of strength and stability. What can it say to an outside observer and potential investor that the country's previous richest man, former Yukos CEO Mikhail Khodorkovsky, is now in jail and the current richest man has his hand out?

This is a bad example not only for foreign observers and investors but for Russian businessmen and citizens as well. The current social contract is based on a tacit agreement between the people and the leaders: Political liberty has been swapped for stability and prosperity. If the prosperity evaporates, the only stability that will remain is the sort that the government enforces with truncheons. Russia will have fallen back into its classic dilemma.

Tsarist and Soviet Russia collapsed because the ruling elite and the broad masses were not connected by any shared sense of common interest. You either submitted to the authorities or deceived them. Only a national emergency -- an invasion by Napoleon or Hitler -- could unite the nation, and never for that long.

In the 17 years since the fall of the Soviet Union, the new Russia has failed to create an identity for itself as vivid and definitive as that of either tsarist or Soviet Russia. There are no new symbols and no new sense of national purpose. Oil wealth and revanchism do not a society make.

The challenge Russia faces as a nation is to create a new society in which wealth and political power are sufficiently shared so that large numbers of its members feel that they have a stake in that society. Failure to do so this time will carry especially grave consequences. There has been a whiff of the abyss in Russia these days too, a reminder that the new Russia, which is even more rickety than its tsarist and Soviet predecessors, could fold every bit as easily as they did -- and after much a much shorter run.

Richard Lourie is the author of "The Autobiography of Joseph Stalin" and "Sakharov: A Biography."