President Bush, President Putin Discuss Free Market Economy
Remarks by President Bush and President Putin to Students at St. Petersburg University
St. Petersburg University
St. Petersburg, Russia
PRESIDENT PUTIN: Thank you very much for having me here. It's a
great pleasure, as always, to be with young people, but especially here
since I graduated from this university, it's a double pleasure for me
to be here. But this university played a dual role in my career. The
first time, when they basically gave me a present -- they just gave me
the degree that I earned -- that was the one important part.
(Laughter.) The second very important facet in my life was when I
worked here for the rector of the university as an assistant, helping
him in the area of international contacts between and among various
universities.
And what I was doing was doing the same thing the rector was just
talking about -- I was setting up the initial contacts between our
university and various other universities around the world. So what we
did was we invited the president of a mid-size college from St.
Petersburg, Florida, to come here and pay us a visit, since they had
the same name. So then, what I did is I talked the former mayor, Mr.
Subchek (phonetic) to receive this president of this college. So he,
in turn, invited him to come to the United States. And this Mr.
Carter, who was the head of this college in St. Pete, arranged a visit
with one of the Presidents of the United States at the time, and I
think his name was Bush. (Laughter.) After that, he invited me to come
to work for him, and the rest of my career is history, as they say.
(Laughter.)
Well, to be very, very serious now, it's really a great pleasure to
have business and dealings with students because students are very
direct, as you know. And they also feel the rhythm of civilization as
it's changing.
When we were guests of the Bushes in Crawford, Texas, we also were
given an opportunity to meet with young people. I think this will
become a very fine tradition.
PRESIDENT BUSH: That's right.
PRESIDENT PUTIN: And I think Mr. Bush also was waiting for this
opportunity, because he asked me several times about this possibility.
Well, George Bush and I don't know each other for that long; I think
it's a little bit less than two years. But what we're trying to do is
establish the environment which would be very conducive to having
people in both of our countries meet, have opportunities to make
contacts and get along better.
I don't want this to sound like a major report here, but I just
want to inform you that we have just signed two major agreements
between our two countries. One of them is having to do with the
reduction in strategic arms of the two countries, and the other one is
called an agreement on a new strategic relationship between the two
countries.
As we all know, people are divided into two groups, optimists and
pessimists. And the pessimists will always find something wrong.
Optimists, however, will find in these two documents that we signed a
lot of things that are very useful and beneficial.
But it's wonderful to deal with young people because, by their very
nature, they're optimists and they look into the future. And that's
why we're here, among other things. So today, when we were coming to
the conclusion of our visit to the Hermitage, and we were running late
so we were in a hurry, Mr. Peotrovskiy, who really had very little
time, said, "By the way, before we leave I want to show you a
portrait," which was a portrait of our great Tsaritsa Catherine the
Great. And Mr. Bush, without missing a beat, said, "Oh, and by the
way, where is the portrait of Potemkin." (Laughter.)
So when you asked questions, I ask you to give me the easy
questions and give Mr. Bush the tough questions. (Laughter.) And with
pleasure, I give the word to George Bush. (Applause.)
PRESIDENT BUSH: Thank you very much. (Applause.) Madam
President, thank you for your hospitality. Laura and I are honored to
be here at this famous university. I'm particularly pleased to be
coming to this university because it is the alma mater of your
President and my friend, Vladimir Putin. But even more importantly, it
is Mrs. Putin's alma mater.
The President was talking about a seminar on international
relations. I guess this is the most sophisticated seminar on
international relations that you could possibly have. So I'll give you
a quick insight as to what it's like to be involved with international
relations.
There we were, as guests of the Putins in their private home last
night. We talked about our families, we talked about our passions, we
talked about matters of life that friends would talk about. The best
international relations start when people care about the other person,
when they try to figure out how the other person thinks and what makes
the other person's life go forward.
We've had a lot of negotiations, of course. But the thing that
impressed me the most about the President and his wife was how much
they loved their daughters. That's a universal value. It's an
impressive value.
When I got out of college in 1968, America and the Soviet Union
were enemies -- bitter enemies. Today, America and Russia are
friends. It's important for you to know that that era is long gone, as
far as I'm concerned. The treaty we signed says a lot about nuclear
arms; it speaks about the need for peace; but it also says the Cold War
is over, and America and Russia need to be, and will be, friends, for
the good of the world.
And so it's my honor to come. I look forward to answering your
questions. Since Vladimir went here to St. Petersburg, it only seems
fair that the hard ones go to him. (Laughter.) We'll be glad to
handle your questions. (Applause.)
Q From the Sociology Department, and the question is, everyone
knows what the brain drain problem is, and it is an open secret that
the traffic of brain drain is most oriented to the United States. I
wonder what the Presidents of these two countries think about this
problem.
PRESIDENT PUTIN: I'll tell you right away, he'll say it's good,
I'll say it's bad. (Laughter.) But if you look at it a little more
deeply, I'll get a little more serious and give you some more detail.
There are two methods for stopping this occurrence. First of all,
close the country down once again, and create such regulatory
conditions where people will lose the right to move freely.
Second is, in a fee economy, to create economic conditions,
conditions of prosperity for all those people so that they wish to stay
here and work. And I think we have to take the second path.
PRESIDENT BUSH: I first of all, there's a lot of brains in this
room. And you get to decide whether there's a brain drain in Russia.
I tell Vladimir all the time I mean, Mr. President all the time --
that Russia's most precious resource is the brain power of this
country. And you've got a lot of it. It's going to take a lot of
brains in Russia to create a drain. There are plenty of bright and
smart people in Russia. Your history says that. I'm absolutely
convinced that the future of this country is incredibly bright. First,
because of the great imagination and intellect of the Russian people.
And second, because you've got a leader who understands that freedom is
going to enhance the future of this country.
You need to know that my view of foreign relations is not only to
promote peace, but it's also to work with our friends, the Russians, so
that the quality of life in both our countries improves.
And so, finally, your question had a little bit of a slightly
pessimistic tone to it. Only slightly. I'm optimistic about Russia.
And a strong and prosperous and peaceful Russia is good for America.
(Applause.)
Q -- from the Department of Economics. And I would like to ask
this question: We are involved in high technology exports. And my
question, in fact, is when will the time come when the bulk of the
exports from Russia would be high technology and high technology
products, and not the primary products like oil and wood, as the
situation is now?
PRESIDENT BUSH: Good question.
PRESIDENT PUTIN: It's a very professional question. And you, as
an economist, understand very well that this situation did not just
happen yesterday. The world market demands those products that are
competitive. And the things that you mentioned, the high-tech kinds of
things that you mentioned are in great demand in the world
marketplace. And it's a no-brainer to understand that there were the
kinds of talent and the kinds of products in the old Soviet Union that,
in fact, had been in demand, because the best brains were directed
precisely in that direction in those days.
One of these areas, for instance, is missile technology. And our
cooperation with the United States in this area can be measured in the
billions of U.S. dollar equivalents. And during this summit, we
dedicated a substantial portion of our discussion time precisely to
this issue, which I consider very important if we are to remove many of
the things that are obstacles in allowing high-tech to come into
Russia. And these obstacles and limitations were placed upon us back
in the days of the Soviet Union, and by their very inertia continue on
and on.
Therefore, many of the products come into Russia from third
countries -- from Europe, from Asia, and not from the United States.
We think that it's not good for our bilateral relations with the United
States. We have to do better. And that's why a great amount of time
was spent by President Bush and myself in trying to find ways to remove
these obstacles. We also spent a lot of time thinking about what we,
ourselves, have to do internally in Russia to help get rid of these
obstacles.
But since we have the high-level esteemed guest in our midst, let
me just direct our question to our bilateral affairs, and that is what
we need above all for Russia is an absolutely nondiscriminatory access
to world markets and to U.S. markets. And we don't need preferences,
we don't need subsidies, we don't need special favors. We just want
normal, simple, ordinary, fair trade relations.
PRESIDENT BUSH: The role of government is not to create wealth.
The role of government is to create an environment in which the
entrepreneur or small business or dreamer can flourish. And that
starts with rule of law, respect of private property, less regulatory
burdens on the entrepreneur, open banking laws so that all people have
access to capital, and good tax policy.
Private ownership in Russia is a little more than 70 percent.
That's a significant change. More and more people are owning small
business. That's incredibly important, because that phenomenon makes
sure that the elites don't control the economy.
There's one piece of good news about Russian taxation, and one that
I learned about yesterday, which Vladimir and I haven't had much time
to talk about, that's troubling. The good news is that the flat tax in
Russia is a good, fair tax -- much more fair, by the way, than many
Western countries, I might add.
I am worried when I heard that some Russian goods -- there is an
export tax on Russian goods. And the trouble with that, of course, is
that no matter how good your goods are, if you price yourself out of
the market, no one is going to buy. So that's a barrier. There's also
barriers coming from Western countries that we've got to eliminate.
Export controls on high-tech goods are problematic, that we're now
reviewing in the United States.
And, very briefly, it is very important for the infrastructure to
be modernized as quickly as possible, so that information from around
the world moves quickly, freely throughout Russia, so that an
entrepreneur such as yourself are able to learn from other
entrepreneurs being connected through the Internet, which is going to
be a great source of ideas and potential wealth for Russia.
Okay.
Q -- from the Foreign Affairs Department. And the question is
addressed to President Bush: What is the image of Russia that exists
in the United States set-up, and how this image of Russia influences
the image of Russians
PRESIDENT BUSH: Image of Russia in the United States?
Q -- of Russia exists in the American political set-up, and how
this image of the Russians influences the making of decisions in the
area of American foreign politics?
PRESIDENT PUTIN: This guy is very tricky, he's a very tricky young
fellow. (Applause.) Mr. President, he's going to listen to your
answer, write a dissertation and get a degree. (Applause.)
PRESIDENT BUSH: Most Americans, -- by far, the vast majority of
Americans are very pleased by the fact that the United States and
Russia is entering into a new era. We've got a new war to fight
together. We're joined to fight against blood-thirsty killers. These
people hate freedom. They hate multiethnic societies. They can't
stand religion. And it's a threat to America, and this is a threat to
Russia, as you all so well know. In this country you've been hit by
terrorist acts like we have been hit by terrorist acts.
The American people truly appreciate the cooperative spirit of the
Russian government, and truly appreciate the sympathies of the Russian
people for what took place on September the 11th.
It's an interesting question about leadership. Does a leader lead,
or does a leader follow? Does a leader lead opinion, or does a leader
try to chase public opinion? My view is the leader leads. And my
administration, along with Secretary of State Powell and National
Security Advisor Rice, are going to do everything we possibly can do to
make relations with Russia strong and friendly and cooperative and
productive for both people.
Good foreign policy -- good foreign policy sets a foundation that
is so firm that it won't crack if one -- one nation or the other gets
weak in the commitment to friendship. And we're laying a strong
foundation.
PRESIDENT PUTIN: I have to say that we have political leaders, we
have public leaders, we have journalists. Our journalists and people
who are specialized in the ministry, for instance, of international
relations and foreign affairs, and other specialists in many other
departments and agencies confirm what President Bush has just said.
PRESIDENT BUSH: Yes, ma'am. Sorry.
Q A student of the Management Department, and the question is
addressed to President Putin: Our countries have lived through quite
different relations. While in the second world war we had one type of
relations, relations very close and friendly; and then the Cold War
came. And my question is, as a result of this evolution of
relationships, what is the state of our relationship between these two
countries now?
PRESIDENT PUTIN: You're studying management, right? Are there any
people from the History Department? And I think the people from the
History Department will probably support me in saying -- in my saying
the following -- the World War II period and the Cold War period were
but two of the most contrasting and sharpest examples of the evolution
of our relations. But we can talk about a lot of different episodes in
our cooperation.
But it really began in the times of the Revolutionary War in the
United States. At that time, the Crown of England appealed to
Catherine the Great and asked for support in quelling the rebellion in
the United States, and the Russian sovereign turned and said, that's
not what we're all about, and declared a military neutrality vis-a-vis
the war. And this neutrality played a significant role in allowing the
United States to gain its independence and gain its foundation.
And today I'm going to present to President George Bush two very
interesting documents, two original documents having to do with the
earliest days of our diplomatic correspondence between our two
countries.
The world was changing over time, our relations were changing over
time. Today, for instance, the United States is our number one trading
partner for Russia, both in terms of the number of goods that are
traded, and also in terms of the accumulated investments that we have
from the United States in Russia. The United States is a great and
powerful power, and has an economy that is powerful enough to a great
extent to determine world economics.
For decades, we voluntarily, on our own, created walls and barriers
around ourselves and decided to live alone within these walls. And at
a time when high technology is absolutely mandatory to the beneficial
development of any country, this circumstance today is just
unforgivable. And today, in the realms of national security,
international security, economics, trade, we now are beginning to blend
in together with the world economy at large.
You can call our relations today a multi-component kind of a
relationship depending on many, many different aspects. But I want to
name the one and most important aspect. Over the last year and a half
or two years, what we've experienced is a huge growth in confidence and
trust manifested between our two countries. And it is precisely this
distinguishing characteristic which colors our relationship.
If you're sitting next to the First Lady of the United States, I
can't say you can't have a question. (Laughter.)
Q The lady is from the Management Department, and she addresses
her question to both of you gentlemen: To make up a manager,
manufacturers are involved. What were those factors that shaped you as
leaders, as managers?
PRESIDENT BUSH: I understand a leader can't do everything. And so,
therefore, a leader must be willing to surround himself, in my case,
with smart, capable, honorable people. A leader must be willing to
listen. And then a leader must be decisive enough to make a decision
and stick by it.
In politics, in order to lead, you've got to know what you
believe. You have to stand on principle; you have to believe in
certain values. And you must defend them at all costs. A politician
who takes a poll to figure out what to believe is a politician who is
constantly going to be trying to lead through -- it's like a dog
chasing its tail.
And, finally, any leader must -- in order to lead, must understand
-- must have a vision about where you're going. You must set clear
goals, and convince people of those goals and constantly lead toward
those goals.
And, finally, you've got to treat people with respect on your
team. And by respecting people, they become -- they become better
members of the team and, therefore, give better advice and work toward
the same goal.
PRESIDENT PUTIN: To be successful in any kind of business, in any
kind of enterprise, you have to have two qualities: you have to have a
sense of responsibility and you have to have a sense of love.
Unfortunately, we have to come to an end here. Somebody is going
to start crying back there if they don't get a question.
Q (Asked in Russian.)
PRESIDENT PUTIN: I did the right thing by giving the question to
her, she's asking President Bush instead. (Laughter.)
Q (Asked in Russian.)
PRESIDENT PUTIN: Great question, WTO. (Applause.)
Q The question is for President Bush from -- from the Department
of International Relations. What specific and concrete steps can we
expect from the United States in order to support our accession to the
World Trade Organization?
PRESIDENT BUSH: Starting with having a President who thinks you
ought to be in the WTO and I think you ought to be. And I think the
accession to the WTO ought to be based upon the rules that every other
nation has had to live up to. Nothing harsher, nothing less harsh.
And I've told Vladimir in private and I've told the American
people, I'm for Russia going into the WTO. Just like I asked just
like I asked Congress yesterday once in a press conference in Russia to
get rid of Jackson-Vanik.
So, to answer your questions, I vote aye, assuming that the
President the Russian government continues to reform her economy, open
it up, make market-based economy work. And that's exactly what the
intentions of this President -- that's the intention of this
President.
PRESIDENT PUTIN: George said it very well. The President of
Russia has to want to be a member of the WTO. And he said that he's
for it. (Laughter and applause.) If that's sufficient, I'm in.
(Applause.) But on conditions acceptable to Russia. (Laughter.)
Dear friends, I want to thank you. I would like to thank you for
the warm and friendly atmosphere in which we were. And it is of great
importance for me personally. Because indeed, I want very much our
dear guests to enjoy my native city. And although, of course, our
movements create some hurdles for the movement of other people in the
streets of Moscow, that, as George pointed out, the people are not very
cross with us, since they wave their hands at us and smile at us.
(Laughter.) And today, we had a friendly and kind atmosphere here, and
the questions were in that spirit. And I am grateful to you for that.
And, as I promised, I would like to hand over to President Bush the
copies of the first diplomatic documents. And these documents actually
initiated, they started the diplomatic letters exchanged between our
two countries, and they date back to 1780. (Applause.)
PRESIDENT BUSH: Thank you all very much. (Applause.)