On Tuesday, March 27, 2007, Dimitri K. Simes, president of the Nixon Center and publisher of The National Interest, spoke on the current state of U.S.-Russian relations. Robert Blackwill, former deputy national security advisor for strategic planning for the President George W. Bush and president of Barbour, Griffith and Rogers International, moderated the event.

In a recent visit to Moscow, Simes met with both Russian officials, and opposition leaders. The general consensus, according to Simes, was clear: the U.S.-Russia relationship is "in serious trouble."

Discussing Putin's recent speech at the annual security conference in Munich, Simes says Putin sent a message that should deeply concern the United States, especially because Putin himself appears to have developed the text. This speech's message: "Business as usual will take us nowhere."

We are not witnessing a re-emergence of the Cold War, considering that Russia is no longer a global superpower, with neither an ideology to export nor an enemy to confront, says Simes. But mutual suspicions of the United States and Russia have left little room for meaningful partnership.

Simes suggested the personal relationship between President George W. Bush and President Vladimir Putin has suffered significantly and, while still functional, can no longer be seen as "special." Still, he added, many in the Russian elite would like to repair relations sooner rather than later-preferring to deal with a Republican administration than take their chances with Democrats seen as even more difficult.

Part of the problem is that unlike many in the United States, the Kremlin does not view itself as a defeated nation or a marginal power. And approaching Moscow as such would be counter-productive, according to Simes. Russian elites believe their period of humiliation is over, and Moscow is in a "proud mood." Nevertheless, Putin's Administration does not want to restore the Soviet empire, Simes said; even Putin has stated that, "Only a crazy man would want to recreate the Soviet Union." But Moscow does assume it should have paramount influence in "its neighborhood."

More broadly, while the United States and others are disturbed by Russia's use of supplies as a political lever; Moscow views energy as its main source of power and influence. Russian officials also see Western demands to stopping energy as a foreign policy tool as hypocritical given that the United States uses its military and economic power all around the world.

While the Kremlin has accepted alternate pipelines coming out of Central Asia, it is especially unhappy with active U.S. encouragement of others to exclude Moscow from projects. According to Simes, Putin is personally interested in seeing continued success for Gazprom, and Russian leaders view pipeline deals that exclude Russian energy firms as hostile.

At the same time, Russia's stability in part is based on energy production. A decline in energy prices could have destabilizing effects on the country's economy. Still, though the United States has "limited" leverage, Simes argued that Washington should apply "delicate pressure" in opening Russia's energy sector to much needed foreign investment.

In the case of Iran, Putin's Administraion is willing to go along with the United States in containing Iranian nuclear ambitions that could lead to an arms race in the Middle East, but it is not too keen on a unilateral American military strike, Simes said. After all, Moscow considers Iran a "good neighbor" because the Islamic Republic has not so far engaged in actions detrimental to Russian interests such as supporting terrorist attacks against Russia.

The fundamental problem in addressing Russian domestic conditions is that Moscow does not see the West as a role model for their country. In fact, he said, efforts to transform Russia through American-funded NGOs, may actually be counter-productive in that U.S. support discredits Russian individuals and institutions that accept it. Simes quoted Gvigory Yanlinsky, one of Russia's most liberal, pro-western politicians, making precisely this point.

In Simes' view, the greatest danger to the U.S.-Russian relationship today lies in the potential for confrontation in Georgia. He expressed concern that if Kosovo declares independence without support from the UN Security Council, which Russia has said it will block if the terms are not acceptable to Serbia, the Georgian regions of Abkhazia and South Ossetia could quickly declare independence too. This could lead to armed conflict between Russian peacekeepers and U.S.-trained and equipped Georgian troops. Simes suggested that the United States should approach these sensitive issues with a clear policy that takes into account Russian interests and American priorities. Ultimately, he said, the U.S. and Russia can work together on important issues like nuclear proliferation and terrorism. But it will not be easy.

James W. Riley is an apprentice editor at The National Interest.