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Remembering Obama’s ‘Russia Reset’: Hillary and the ‘Skolkovo’ Misadventure

Hillary Clinton speaks at a panel for the Hulu documentary Hillary during the Winter TCA Press Tour in Pasadena, Calif., January 17, 2020. (Mario Anzuoni/Reuters)

Author’s Note: This is an excerpt from my 2019 book, Ball of Collusion.

Ah yes, let’s remember the Obama-era “Russia Reset.” It was announced with great ceremony by Secretary of State Hillary Clinton, brandishing a red plastic “Reset” push-button that she presented to her counterpart, Foreign Minister Sergey Lavrov. Oops: The button was mislabeled Peregruzka (the Russian word for “overcharge”) rather than Perezagruzka (reset). As investigative journalist Claudia Rosett observes, the Kremlin still keeps the button on display in a museum at the Foreign Ministry, “less a souvenir of U.S.-Russia camaraderie than a symbol of American folly.”

Even as Putin continued his occupation of Georgia — having annexed about a fifth of that former Soviet territory in 2008 — President Obama kicked off the Reset by shelving Bush’s plans for missile-defense installations in Eastern Europe. Further courting the Russian dictator, Obama in 2010 revived the U.S.–Russia Civilian Nuclear Cooperation Agreement (Bush 43-era foolishness that had been scrapped after Putin invaded Georgia). The president insisted that, somehow, the pact advanced U.S. national security.

That was just the beginning of the administration’s promotion of Russia’s key industrial sectors, improving our declining but dangerous rival’s military and cyber capabilities and fortifying its capacity to extort the European nations and former Soviet republics that rely on Russia for their power needs.

Why? Because “Trade with Russia Is a Win-Win.” That was the headline of Secretary Clinton’s June 2012 Wall Street Journal op-ed, applauding Russia’s formal entry into the World Trade Organization (which her husband, President Bill Clinton, had championed even though Russia’s corrupt economic practices undermine the market-based norms the WTO is meant to fortify). Prioritizing trade was crucial, she explained, because Russia was just a great place for Americans to do business, and our commerce could now blossom since the Obama administration had made Moscow “a normal trading partner.” Sure, the Putin regime posed many challenges, but Clinton maintained that “it is in our long-term strategic interest to collaborate with Russia in areas where our interests overlap.”

Collaborate? That sounds almost like collu—well, never mind.

Obama and Clinton decided that one of these collaborative areas should be technology. Under the secretary’s guidance as point person of the Obama administration’s “U.S.–Russia Bilateral Presidential Commission,” the State Department teamed up with Russia’s Foreign Ministry to help erect Moscow’s version of Silicon Valley — Skolkovo. It’s unlikely Putin could believe his good fortune: The project was like an espionage operation in broad daylight, openly enhancing Russia’s military and cyber capabilities.

The Defense Department’s European Command put it this way:

Skolkovo is an ambitious enterprise, aiming to promote technology transfer generally, by inbound direct investment, and occasionally, through selected acquisitions. As such, Skolkovo is arguably an overt alternative to clandestine industrial espionage — with the additional distinction that it can achieve such a transfer on a much larger scale and more efficiently. Implicit in Russia’s development of Skolkovo is a critical question — a question that Russia may be asking itself — why bother spying on foreign companies and government laboratories if they will voluntarily hand over all the expertise Russia seeks?

Recognizing Russia’s “current pursuit of external aggression and internal repression,” which marked what it generously regarded as the Kremlin’s “previous course toward democracy and cooperation with the West,” EUCOM stressed caution against “the risks that Russia could leverage transferred scientific knowledge to modernize and strengthen its military.

Ya think? The U.S. Army’s Foreign Military Studies Program at Fort Leavenworth concluded that Skolkovo was a “vehicle for world-wide technology transfer to Russia in the areas of information technology, biomedicine, energy, satellite and space technology, and nuclear technology.” Moscow has made it unabashedly clear, moreover, that “not all of the center’s efforts are civilian in nature”: the project was involved in military activities, including the development of a hypersonic cruise missile engine.

The FBI ended up warning several American tech companies that entanglement with Skolkovo risked wide-ranging intellectual property theft. The agent in charge of the Bureau’s Boston field office even took the extraordinary step of publishing a business journal op-ed, depicting Skolkovo as “a means for the Russian government to access our nation’s sensitive of classified research development facilities and dual use technologies with military and commercial application.”

Why would our government do such a thing? At the time this was all going on, Clinton’s State Department issued its annual country-by-country findings on the state of civil liberties. Russia was found to be using technology “to monitor and control the internet.” The State Department elaborated that official corruption was rampant, security services engaged in sweeping surveillance of communications, journalists were under siege, dissidents were arbitrarily detained — and some even tortured and killed.

What was Secretary Clinton thinking?

As we’ve seen, most of the time, she was thinking about the Clinton Foundation, and money (I’d say not in that order, but it’s pretty much the same order). Putin’s regime dangled billions of dollars to invest in Skolkovo companies. Secretary Clinton immediately went to work attracting both corporate contributors and businesses deemed worthy of Russian investment.

The investigative journalist Peter Schweizer has done yeoman’s work exposing the grimy interplay between the Clinton Foundation and the State Department. By 2012, the last year of Secretary Clinton’s tenure, 60 percent of the “key partners” identified for the Skolkovo venture (17 out of 28) had “made financial commitments to the Clinton Foundation, totaling tens of millions of dollars, or sponsored speeches by Bill Clinton.” Russians tied to Skolkovo also gave to the Clinton Foundation, including Viktor Vekselberg, a billionaire confidant of Putin’s who was chosen to run the Skolkovo Foundation.

There is symmetry here. Again, no one would sensibly say that Secretary Clinton wanted to make Russia a more capable adversary — and as things turned out, I’d wager that strengthening the regime’s cyber proficiency would be something she’d regret (if she were given to that kind of introspection). But it is like the irresponsible mishandling of top-secret information, and the storing and transmission of any sensitive government information, classified or otherwise, on a non-secure server system: it’s not that Clinton did not know what she was doing or that she didn’t apprehend the risks; it is that she had other priorities and threw caution to the wind — pretty much the textbook definition of gross negligence.

She wasn’t alone: this was not Secretary Clinton’s administration, but President Obama’s. He calculated that abetting and appeasing Russia was a price worth paying for “help” on the Iran deal and in Syria. How well that all worked out, no?

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