Russia’s hemorrhaging economy has long since lost its appeal to foreign investors, but the country’s geopolitical role makes abandoning it entirely a risky prospect for Western governments. "Russia will go to the G8 summit this weekend expecting a quid pro quo for getting the West out of a messy situation in Kosovo by brokering a peace deal," says Meier. "Whether or not the IMF and other Western institutions come through with money for Russia depends a lot less on the outcome of a Duma vote on economic reform than on the outcome of the Kosovo conflict." In other words, the most important Russian negotiators in the bid to get Western financial aid may be the ones in armored personnel carriers at Pristina Airport.
Bailing out Russia makes almost no financial sense, but it matters a lot politically. That may be why nobody appears overly surprised -- or concerned -– that the country’s parliament, the Duma, on Thursday rejected a key package of economic reforms. The proposed reforms would have been an effort to meet the preconditions for a $4.5 billion IMF loan required to roll over Russia's debts to the international institution. "This was entirely expected," says TIME Moscow correspondent Andrew Meier. "It’s a lame-duck Duma voting down conditions agreed to in April by a government that no longer exists as a challenge to a lame-duck president. The curious thing is that the new government is trying to institute price controls and other measures that would traditionally send the IMF racing for the exits, but the IMF is staying silent."