Jackson-Vanik: Exit, Stage Left

There is a now-infamous study on the subject of “decision fatigue,” which looked at decisions by Israeli judges to grant vs. deny parole. The researchers found a wildly skewed trend in the judge’s decisions, but not by criminal history, ethnicity, gender (even rehabilitation programs had less impact). Rather, the prisoners in front of recently-fed judges were granted parole 70 percent of the time, while those in front of hungry judges were granted parole only 10 percent of the time. Plotted on a graph, the chances of parole sink drastically as the previous meal becomes a distant memory (image taken from study):

The researchers concluded, among other things, that (i) glucose depletion in the brain increases the effort required to make complex, although binary decisions such as whether to release a criminal into the public; and (ii) as the decision-making process grows more difficult, individuals will tend to prefer the “safe” decision of not making any changes (in this case, denying parole, and keeping the prisoner incarcerated).

Decision Fatigue in U.S.-Russian Relations

Although the situation is not identical, it is possible to discern a similar type of “decision fatigue” that plagues U.S.-Russian relations (Bush ‘freedom agenda’ and Obama ‘reset’ notwithstanding). The reason is that Russia (as USSR) was the U.S.’s primary antagonist for nearly 50 years, resulting in a set of reliable behavioral interactions aimed at forestalling sudden change and uncertainty (raising risk of nuclear war). Now, Russia is not our primary antagonist, but the behaviors remain. Consequently, like the Israeli judges, U.S. and Russian policymakers more often than not opt for no change in the U.S.-Russian relationship, which is convenient because we already know what roles to play after 50 years of practice. This is particularly true with Congress, where pushing a rethink of Russia policy is a low reward / high risk gambit. Still, one would hope that Congress would at least spot the low-hanging fruit – moves that benefit the U.S., respond to Russian concerns, and eliminate Cold War legacies that no longer serve any purpose.

Repealing Jackson-Vanik – A High Reward/Low Risk Improvement

Very soon, Congress will have the opportunity to take action on an issue that, for practical purposes, was irrelevant up until now. With Russia’s accession to the WTO scheduled for August, the deadline for repealing the Jackson-Vanik Amendment is closing fast.

The Jackson-Vanik Amendment was added to the U.S. Trade Act of 1974, with an aim of pressuring the USSR on human rights issues, particularly restrictions on the emigration of Jews from the Soviet Union. The effect of Jackson-Vanik is to deny permanent normal trade relations (PNTR) status to communist countries that restrict emigration. The President, however, may waive the application of Jackson-Vanik on a yearly basis, which has been done for Russia without fail since the Soviet collapse. The WTO, however, requires all member countries extend PNTR to one another, and Congress has permanently lifted the application of Jackson-Vanik from a number of former communist states (e.g., Kyrgyzstan, Georgia, Mongolia, Ukraine, Vietnam).

So, in principle, repealing Jackson-Vanik for Russia should be nothing more than a procedural issue: it has no practical application due to the annual waiver, but now must be lifted to comply with WTO regulations. Unfortunately, the ‘decision fatigue’ over Jackson-Vanik is already showing, with some members of Congress treating Jackson-Vanik like an essential element of U.S.-Russian relations. For example, Sen. Orrin Hatch said, “The president would have Congress pass PNTR and ignore Russia’s rampant corruption, theft of U.S. intellectual property, poor human rights record and adversarial foreign policies for a market that amounts to .05 percent of U.S. exports.” Hatch is a smart guy – he knows Russia gets PNTR every year already, and thus that not repealing Jackson-Vanik will not influence Russian behavior. But the autopilot is already on, and Hatch doesn’t see that the issues he cites would be helped by repealing Jackson-Vanik.

Why Repeal Jackson-Vanik Under the Hatch Criteria:

  1. Human Rights/Democracy/Corruption – although related to human rights, Jackson-Vanik dealt with a specific issue – freedom of movement for Soviet Jewry – that died with the Soviet Union. This happened because Russia swapped its economic/political model for ours, albeit with imperfections. Further integrating Russia into the international economic system will undermine corrupt oligarchs/officials who profit from Russia being kept in the dark. Perhaps most persuasive – the leading members of the non-systemic opposition (Navalny, Milov, etc.) are all for lifting Jackson-Vanik.
  2. Foreign Policy – again, if the U.S. would like more leverage over Russian behavior, it would make sense to increase trade and investment in the country. Hatch seems to imply that if we could get U.S. exports to Russia down from .05 percent to .025 percent, Russia would join NATO all of a sudden.
  3. Intellectual Property Rights – if the U.S. does not repeal the Jackson-Vanik amendment by the time Russia accedes to the WTO, we will not be able to use WTO dispute resolution mechanisms (e.g., enforcement of TRIPS Agreement).

Most important, Congress needs to remember that if Jackson-Vanik is not lifted, the U.S. will face all of the negative consequences (WTO-related sanctions, nullification of WTO agreement with Russia, higher barriers to entering Russia), and Russia will still be better off than it was before (i.e., in the WTO). In contrast, repealing a Soviet-era relic that has not been used in decades will be no more of a ‘victory’ for Russia than for the U.S. Instead of being seduced by the old rhetoric and patterns, Congress should weigh the consequences, listen to the protest leaders in Russia, and repeal Jackson-Vanik this session.

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12 Responses to Jackson-Vanik: Exit, Stage Left

  1. The protest leaders in Russia didn’t merely call for lifting Jackson-Vanik, they called for passage of the Magnitsky Act, which you don’t even mention.

    Many people keep referring to “abolishing” or “repealing” JVA. That’s not necessary. It doesn’t specifically mention either Russia, the Soviet Union, or Jews. It’s about non-market economies that restrict emigration. So it still applies to Turkmenistan, Uzbekistan and other countries and should remain on the books. No need to hand any moral victory to the Kremlin by completely eliminating the law.

    It’s a very easy matter to have Congress pass an act to graduate Russia permanently, and that should be done. AND the Magnitsky Accountability Act should be passed simultaneously because indeed legislation of this nature with sanctions for human rights abusers has been proven to have an effect — as Jackson Vanik itself did.

    It’s wishful thinking, however, to think that integrating Russia into the world economic system or improving trade somehow brings about liberal democracy and human rights. That didn’t happen with China; it’s the “perestroika before glasnost” argument that doesn’t work. True economic advancement comes when you have the rule of law, and you don’t let lawyers who uncover tax fraud die in prison deliberately.

    http://3dblogger.typepad.com/minding_russia/2012/03/dont-hand-russia-the-moral-victory-of-abolition-of-jackson-vanik-graduate-and-pass-magnitsky-bill.html

    • Augis says:

      But “punishing” Russia by continuing JVA also will hardly bring democracy.
      And why is Russia different from China?

      • Augis, you seem to have trouble grasping that the Magnitsky Act goes to the heart of what is wrong with the notion of “trade before democracy” and rewarding corrupt regimes who demand trade engagement in advance before they change their abusive natures.

        The Magnitsky case is all about these issues. It’s about a lawyer for a Western investment firm uncovering blatant corruption in the form of the Russian tax authorities taking a tax payment, then claiming it wasn’t paid, and then prosecuting a firm for it, in a nutshell. When Magnitsky continued to protest, he was jailed, and then tortured and left to die in jail. That’s awful! That means you cannot call out corrupt Russian business
        dealings when they occur and insist on the rule of law. Human rights violations and government and business corruption are two sides of the same side of legal nihilism in Russia that we have to oppose. It’s particularly apt in changing from JVA, which was about trade relations, to a bill that addresses *directly* the corruption and lawlessness so visible in this one case. Other cases of impunity are also mentioned because the real problem with Russia is the pretense that they can pass laws, make nice statements as Medvedev did when he said he’d assure justice for Magnitsky, but then do absolutely nothing and not really change. These are the basics.

        While nothing an external actor can do “brings democracy” like it’s some sort of package in the mail, it can bolster the forces for genuine change inside the country by showing solidarity with them and displaying firmness to their torturers. That’s why this is so vital. As for China, JVA was declared no longer applicable, permanently. JVA itself wasn’t lifted.

    • jesseheath says:

      Yes, the protest leaders did advocate passage of the Magnitsky Bill. But whereas Jackson-Vanik is about promoting human rights generally, the Magnitsky Bill is about obtaining justice in specific cases (i.e., by sanctioning individual officials involved in human rights abuses). So while it makes sense for the protest leaders to support the Magnitsky Bill, from an American perspective I don’t think the Magnitsky Bill is the logical replacement for Jackson-Vanik (after all, the USG already has the ability to impose travel restrictions and freeze assets of individuals involved in human rights abuses, without further action by Congress).

      Regarding the link between global integration and democracy/human rights – yes, the jury is still out on that. China joined the WTO in 2001, and a decade later the growth fueled by increased trade has started to bring the Communist party under significant strain. The fact that there is a protest movement in Russia is in large part due to the growth of the middle class over the past decade. Imagine how much larger the middle class, and thus the protest movement, would be if Russia had been a member of the WTO over the same time period.

  2. In order to impose visa sanctions, the State Department would have to go to the trouble in each individual case and would have to be persuaded in each individual case, and may not act and may not name names. With the act of Congress, all the list of officials involved is given, the names are named, and the principle of accountability is accentuated. That’s an important deterrent. It’s perfectly find to have a deterrent of this nature passed as a follow-up to terminating the application of Jackson-Vanik.

    As for this notion that not global integration (which would mean freedom of the Internet), but econmic relationships with oppressive regimes brings human rights progress, no, this is not proven. The growth of the middle class in Russia is due to rising oil prices and such accomplishments as the opposition and human rights movements could make after the collapse of the coup and USSR in 1991. It’s not due to Western support of the Kremlin in business deals. And this improvement suffered severe reversals in the last 8 years in particular, and in fact these large protest meetings failed to make any change at all so far — Putin in fact came back to power, and could point to ostensibly even more legitimacy as he allowed large demonstrations on the eve of elections and some criticism of himself on television. All this is in the process of being brutally reversed now.

    As for the Chinese Communist Party being “put under strain,” that isn’t bringing any significant human rights progress or any actual threat to the Party itself collapsing, so the theory that economic engagement is the cause doesn’t wash. Again, it’s people who manage to push the limits and get international support, like artists, lawyers, writers, that manage to open up the space, but the progress is slow and often reversed.

    I don’t see any provable relationship between WTO membership, middle class emergence, and actual human rights progress. It’s the Chinese view of “perestroika before glasnost” and not even perestroika, but merely state capitalism and Western trade. It’s not demonstrably linked to anything but perpetuation of the Communist Party (as Gorbachev had hoped — and even in the Russia case, the collapse of the ruling party did not lead to the emergence of anything but another single party rule, essentially, with more of a nationalist tilt.) There’s also nothing to prove that the middle class is some bearer of liberal values and tolerance of dissent and other aspects of what it would mean to have human rights and democracy and prevail. In fact, if anything, the presence of Navalny, the nationalist and Udaltsov, the neo-Communist as leaders of the new opposition lets you know that middle class membership simply means a desire for more power and more say in the nation’s affairs, not liberalism. These shouldn’t be confused, in Egypt or in Russia.

  3. rkka says:

    “In order to impose visa sanctions, the State Department would have to go to the trouble in each individual case and would have to be persuaded in each individual case, and may not act and may not name names.”

    So… a bureaucrat would have to do some work. Not a problem.

    “With the act of Congress, all the list of officials involved is given, the names are named, and the principle of accountability is accentuated.”

    Who made Russians accountable to the US Congress??

    “That’s an important deterrent.”

    Not really.

    “It’s perfectly find to have a deterrent of this nature passed as a follow-up to terminating the application of Jackson-Vanik.”

    Kate, although the American Congress still pine for the days when “Okay Boris, here’s what you’ve got to do next. Here’s some more sh*t for your face.”, was considered an adequate basis for US-Russian relations, the Russian government no longer do. Deal with it.

    On the whole, your sort vastly overestimate the role the US can play in solving problems in Russia. For instance, Washington talks much of Russian supposedly dire demographics, while failing to notice that Washington’s preferred solutions don’t help where they are applied. For instance, you will find no more enthusiastic US ally than Latvia, yet deaths there now exceed births by almost 1.6 to 1. Russia’s birth rate is 50% higher than Latvia’s. So, does Russia need US aid and advice to… look more like Latvia??

    Sane Russians understand that the US care not how, or even whether, Russians live, only that the Russian government submit. This is why they re-elected Putin, all your noise about fraud and corruption notwithstanding.

  4. marknesop says:

    “AND the Magnitsky Accountability Act should be passed simultaneously because indeed legislation of this nature with sanctions for human rights abusers has been proven to have an effect — as Jackson Vanik itself did.”

    Jackson-Vanik had absolutely zero beneficial effect, at least on Russia. Emigration of Soviet Jews – which it was allegedly written to address – was resolved on its own and the amendment would hardly have had much of a chilling effect on the practically zero trade between the principals at the time. As Jesse points out, an annual waiver was granted every year, so Jackson-Vanik was perceived as being kept simply as a goad and a tool of humiliation. When it was lifted for Ukraine just in time for presidential elections – a country manifestly more corrupt than Russia, with some 70% of its GDP vested on oligarchical wealth – in a blatant bid to help Yushchenko’s re-election, that impression was confirmed. Jackson-Vanik could be lifted for anyone willing to place themselves in yoke to western servitude and to listen brightly to its portentous lectures. Not so much for those who would not.

    The year after Jackson-Vanik was enacted, emigration from the Soviet Union dropped by 35%. Russia is no more responsive to U.S. pressure than was the Soviet Union. The U.S. – or at least eraserheads like Orrin Hatch – cannot seem to get it through its head that it is not dealing with a country it can intimidate by rattling its sabre in its scabbard.

    The Magnitsky Bill is nothing more than an attempt to cater to William Browder’s narcissism, and Sergei Magnitsky was not a lawyer. He was an accountant, and there is no record of his having passed the bar. Implementation of the Magnitsky Bill would put the self-acclaimed Beacon of Human Rights in the unenviable position of sanctioning persons without the mechanism of appeal, and punishing people who have not been found guilty of a crime, all to please a deep-pockets multimillionaire with an ego bigger than the country he lives in, which is not the United States of America. Is it worth it? Worth $9 to $10 Billion annually? All for zero result, except pleasing William Browder? You tell me.

    • You don’t know history, Mark.
      Of course Jackson-Vanik had excellent effect. As has to be stated again and again because of this perspective you’re articulating (not new), which the Russian government has been first to always promote (especially lately), while the numbers of emigration dipped after the first year, they went up again when the US remain firm in its resolve to keep it in effect and go through reviewing performance on an annual basis. The waiver process made it possible to hold hearings on not only emigration, which was all that was specifically addressed in the amendment, but on other human rights issues. Jewish emigration continued steadily for years afterwards. To look at the initial drop when the Russians tried to backlash with it is only a narrow slice of the history — you have to look at its dramatic effect over the next decade.

      Jewish emigration would never have been resolved without it, because it was a demonstration of will that the Russians tried to break via Gromyko, who worked with Kissinger — who opposed it — to undermine it.

      It’s really a contest to try to figure out which is more corrupt, Russia or Ukraine, but certainly Ukraine is no worse, and arguably has had more experience with more democracy whatever it’s many problems.

      Indeed, all the Kremlin understands is resolve, and that is indeed what is required.

      Magnitsky isn’t “narcissism” — you appear unable to explain why a tax lawyer in a tax dispute, even if true, should be arrested, and then cynically tortured and allowed to die. The Magnitsky Act also addressed many other crimes, including those of Kadyrov, the strongman of the Chechen Republic. It’s about impunity in general in Russia, which is a problem not only for human rights, but business.

      No one has ever questioned Magnitsky’s status as a lawyer, this is a new twist. Where did you get that?

      The Magnitsky case is emblematic of everything that goes wrong in Russia, first for its own citizens, then for foreigners trying to deal with it. It’s about callous cruelty, corruption, cover-ups, lack of due process, and that’s worth addressing head on.

      • marknesop says:

        Hello, Catherine;

        “You don’t know history, Mark. Of course Jackson-Vanik had excellent effect.”

        So you say, and I appreciate the reserve of your reply. However, it might have simplified things if I had supplied the link where I obtained that information:

        http://www.ewi.info/next-round-jackson-vanik

        According to Jacqueline McLaren-Miller, a Senior Associate at the East-West Institute – itself a prominent human-rights organization, Jackson-Vanik is “completely ineffectual in promoting human rights and rule of law in Russia. At worst, it is counter-productive.” She goes on to say that, while it was reasonable to expect Jackson-Vanik to offer some leverage on Soviet human rights policies, it has no relevance to modern-day Russia. While it might not meet your definition of an oasis of tolerance, Russia has been in full compliance with Jackson-Vanik vis-a-vis emigration – which it was specifically designed to address – since 1994. Russia has not restricted emigration for a very long time, and continuing Jackson-Vanik is not doing anything at all to affect any other aspect of human rights in Russia. Once Russia accedes to the WTO, the USA will be unable to trade freely with it so long as Permanent Normal Trade Relations (PNTR) do not prevail. That will not hurt Russia appreciably, but it will hurt American businesses that wish to expand trade and sell their product in Russia. If Jackson-Vanik really was doing such a good job, how could Russia be granted a waiver every year while American sources continued to bitch about its human-rights record? Obviously, somebody is wrong, unless things have evolved to where two different camps taking opposite positions on a narrow issue can both be right.

        It’s true emigration from the Soviet Union did climb slowly after the 1974/75 drop, but I have not seen anything that suggests this was attributable to the United States’ firmly taking the Soviet Union by the ear and showing it the way. After a slow climb until 1979, emigration plummeted by 58% in 1980.

        Sergei Magnitsky graduated from university as an accountant and auditor; there is no record that I could find of him ever having sat or passed the bar exam. He worked for Firestone Duncan as a tax and general auditor, according to his workbook. Nowhere does it use the words “attorney” or “lawyer”.

        http://www.slideshare.net/bulkaed/trud?from=embed,

        That doesn’t mean you could not use a lawyer as an auditor. It’d be kind of like using a computer programmer to make sandwiches in the company cafeteria, but you could do it. I did not find anything that suggested Firestone Duncan were so keen to pay high wages that they would underemploy lawyers as accountants. But you might have a point; the firm obviously did not know him very well at all, since they couldn’t even spell his name right on the company memo that announced his death.

        http://robertamsterdam.com/2009/11/remembering_sergei_magnitsky/

        Note that it does not mention anything about his having been cynically tortured to death. It says he died of a condition that could have been cured by a simple operation and medication. Browder himself did not breathe a word about Magnitsky’s indictment until he was dead. Then, of course, he was a hero. He also hired the firm of Gridnev and Partners to ride herd on Magnitsky’s case. They visited him many times – they were his attorneys, after all – and did not mention anything about his being mistreated.

        Emigration did climb after

        • The East -West Institute is not a prominent human rights organization. It’s a think tank, a research institute. And during this period in the 1980s, as I well remember ver well, the director Mroz, who remains today, took the position common on the left, then as now, that the US should not threaten peace and disarmament by raising human rights issues publicly. Indeed, he was for not forcefully advocating human rights and in no way would he himself called his organization “a human rights organization” then or now. Fortunately, many people ignored him and others in the peace and “freeze” movement of the time, and continued to publicly condemn the Soviets’ many human rights abuses. In the end, it was not quiet diplomacy or silence or arms talks that changed the dynamics; it was change from within that came when there was sufficient external pressure in the form of solidarity and support of those who made those changes.

          Jacqueline McLaren-Miller is merely articulating a certain position, well known since the 1970s, that Jackson-Vanik “didn’t work” because initially the Soviets responded by cutting emigration. But then it rose again and continued for many years after precisely because the US maintained its resolve in the face of Soviet blackmail. Those with this position never turn the page past their initial point of one year and can’t explain why emigration rose again, using their theory. As for the dip after the invasion of Afghanistan in 1979 and the US boycott of the Olympics in 1980, again, it resumed, even in the years of Andropov, so your theory doesn’t work. That you “haven’t seen anything” that makes this point simply means that you didn’t live through this period of history and you simply haven’t read enough, but the facts themselves tell the tale — Google the emigration tables on Wikipedia or some other site and you will see they continue for many years until the Gorbachev era and then fall of the Soviet Union.

          I don’t know why she — and you — are going on and on and on about how Jackson Vanik doesn’t apply anymore. Nobody claims it does literally, as the language in fact doesn’t refer to Jews, and doesn’t refer to anything but emigration. The language of the bill refers only to non-market economies that restrict emigration. Russia is no longer a non-market economy and no longer restricts emigration. Everyone long since “gets” that. Its application for Jewish emigration is moot as now Jews and anyone else in Russia has the opposite problem, getting a visa to another country, not exit from Russia. The points then are the following:

          1. Jackson Vanik itself as a law should not be abolished and removed from the books, as it still applies to countries like Turkmenistan or North Korea, and the Kremlin shouldn’t be handed a moral victory in getting its long-time wish of physically removing the law completely — unfortunately the Russians keep hammering on this point in particular because Obama phrased it this way when he first held out the promise to them.

          2. The Russians should of course be graduated *permanently* from the law with an Act of Congress. This is no legal problem whatsoever. China and other countries have been *permanently* graduated in the same fashion, i.e. not with a waiver each year, but *permanently* graduated. That’s certainly enough for the WTO and certainly enough to satisfy the letter of the law.

          3. The reason this simple exercise hasn’t been done is because of the historical role J-V played as a device to look at all of Russia’s human rights problems, not just Jewish (or any other) emigration, in hearings in Congress. This was its role in the 1980s. So many members of Congress are reluctant to retire that mechanism for review without a replacement. Indeed, the annual waiver process was kept in place precisely to have a review mechanism and to attempt to exercise some pressure on Russia over its many human rights issues and cases.

          4. The Magnitsky Act, which was already in progress before the issue of permanent retiring of J-V came about, is an acceptable replacement. Congress should retire application of J-V permanently and pass Magnitsky, which is not merely about one case but a number of cases, and gets at the very pertinent issue of impunity in the Russian justice system. And the case is emblematic not only of human rights issues, but the very real problem of severe corruption in business, and therefore any improvement of trade relations represented by PNTR should indeed involve some mechanism that seeks to punish obvious corruption and abuse in this emblematic case.

          Indeed, Magnitsky suffered torture — deliberately withholding medical care and leaving someone in a cold cell without care *is* torture. There is no question about that. That is what experts say, and that is clear-cut — not everyone outside the human rights field per se would describe it as such but it is indeed the case.

          I don’t see any evidence at all that Magnitsky was not an attorney, and attorneys work on tax matters all the time, in the US and Russia. Your notions are specious and just part of a general malicious pro-Kremlin intervention whose motivations aren’t clear.

          As for the idea that a typo in Amsterdam’s blog represents some indifference, well, look to yourself on that one. He has written numerous pieces on Magnitsky. I don’t see any reason to suspect anyone in the story of indifference “until he was dead”.

          • marknesop says:

            Well, as before, we will have to agree to disagree. I do not see any dramatic surge in emigration of Soviet Jews that could be attributed to pressure exerted by Jackson-Vanik, and in fact see no reason why any of what happened would not have happened if Jackson-Vanik had never been – barring the reactionary drop in emigration the following year. This issue is basically a case of your disagreeing with a position you term “leftist”, which is fine as they manifestly disagree with you.

            Graduation of Russia from Jackson-Vanik does indeed make sense, and is perfectly workable as you have described it. If real use does actually remain for the law, bearing in mind that it was designed to fit a fairly narrow set of circumstances, then your recommendation makes sense there as well.

            Attorneys do work on tax matters all the time. In Russia, just as anywhere else. However, the workbook is not designed to reflect a record of employment for each individual task you do – for example, if you were a mechanic, you would put “mechanic” as your profession, not “tire changer” or “oil changer” or “exhaust manifold welder ” based on what the company might have directed you to do that day. Mr. Magnitsky lists his employment as “auditor” rather than “attorney”.

            And indeed there was an advantage to have him broadly perceived as an attorney. An auditor or accountant could be compelled to testify in situations where an attorney could invoke attorney-client privilege, and refuse.

            The typo you describe, which is unlikely to be the case as it is misspelt throughout the text, is not attributable to Robert Amsterdam. He is merely reprinting the memo just as it appeared, and he did not write it. In fact, he points out the spelling discrepancy in his introduction.

            I agree with your definition of “torture”, and am certainly not defending it. I hope we can agree also that the United States is in no position to censure anyone else on the general cruelty of leaving someone on a cold floor or refusing them medical attention.

  5. marknesop says:

    Please ignore the final line, it was an orphan left after reformatting.

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