Activities in Russia
During the early 1990s, Andrei Shleifer was an advisor to Anatoly Chubais, the then vice-premier of Russia, and was one of the engineers of Russian privatization. During that time, the Harvard Institute for International Development of Harvard University was under a contract with the United States Agency for International Development, which paid Harvard and its employees to advise the Russian government. In a period from 1992 to 1997, the Harvard Institute for International Development (HIID) under Shleifer received $40 million directly from the $300 million budgeted for the United States Agency for International Development. Additional sums were given in grants to public relations firm Burson-Marsteller and Big Six accounting firms.
Shleifer was also tasked with establishing a stock market for Russia that would be a world-class capital market. That effort became mired in charges of corruption and self-dealing.
While in Russia working as the project director of the HIID, Andrei Shleifer was an adviser to the State Property Committee (Russian acronym GKI), a board member of the Russian Privatization Center, and a USAID-paid advisor to the Russian Federal Securities Commission.
Two decades after meeting Shleifer at Harvard, Lawrence Summers’ work as the undersecretary of the Treasury, the deputy secretary of the Treasury, and the secretary of Treasury put him in place to design U.S economic policies in such a way to allow and facilitate Shleifer’s work on the Harvard Project. Summers "helped Shleifer and Harvard gain noncompetitive government awards”. In 1996 complaints about the Harvard Project led Congress to launch a General Accounting Office investigation, which concluded that the Harvard Institute for International Development was given "substantial control of the U.S. assistance program.” Such an arrangement was “highly unusual”, according to Louis H. Zanardi, who led the GAO investigation.
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