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2. Our foreign assistance programs must avoid strengthening the 

 central institutions of the old communist system which are still 

 largely in control of all productive sectors in Russia. While 

 supporting broad policy reform, our assistance must go right to the 

 grassroots and demonstrate the advantages of private enterprise. 



We need to focus assistance on helping grassroots leaders who have 

 made the mental shift toward initiative and self-reliance. They 

 are under extraordinary pressure, working against the inertia, 

 passivity and fear inculcated by the old system. Their courage in 

 exercising initiative is amazing. They are facing mounting 

 opposition by the old guard. 



Technical assistance should help these local leaders reorder their 

 country's rich human and natural resources in small-scale private 

 business activities. We should help them imagine, create and 

 organize transitional and nascent organizations that promote 

 private initiative and nurture trust. In general, U.S. assistance 

 providers should take great care in working with large companies 

 and business partners with access to funds because, in most cases, 

 these are former communist apparatchiks. 



In focusing our assistance, we need to keep in mind two groups of 

 reformers: urban leaders who often emerged from intellectual and 

 dissentient groups, and rural "peasant" leaders who are committed. 

 to individual responsibility for the stewardship of the land. To 

 reach these peasants, U.S. assistance must go to rural areas where 

 there is sufficient political tolerance to allow them to succeed. 

 Local leaders need to be cultivated to support the fledgling family 

 farmers who, with sufficient time and resources, will be able to 

 prove the inherent advantages of private agriculture. 



3. We should provide surplus U.S. food and feed in ways that 

 support family farming rather than re-enforce the old state command 

 structure of agriculture. This can be done in two ways: surplus 

 food and feeds themselves can be a development tool by requiring 

 auctions which stimulate private suppliers, truckers and 

 processors. Second, our surplus food commodities can be monetized 

 (sold in the marketplace) because that way it will not undercut 

 local farmers and, quite frankly, with the degree of corruption the 

 food will end up in the marketplace in any event. 



We recommend earmarking a percentage of our surplus food and feed 

 grains for private agriculture and that it should be distributed 

 through or in cooperation with the AKKOR national and regional 

 network which represents and supplies private farmers. We propose 

 that up to 25 percent should be earmarked as a condition of our 

 assistance. 



4. Feed grains can help stimulate the critical livestock sector 

 rapidly. But, we need to accompany such grains with long-term 

 technical assistance and training for strengthening private 



