Perhaps the war in Chechnya is the cause of the problem, or perhaps the effect. But in either case, there is a clear sense in policy decisions being made at the moment that the Russian government is about to take a kamikaze dive into isolationism for which the country will pay dearly.


As a report from the Russian European Expert Group says, the balance of Russia's budget for 1995 is so delicate that without the billions of dollars in foreign loans that have been factored into it, the economy is likely to collapse. Yet the government seems to be doing little to secure that money or the stability that comes with it.


First of all, there is the war in Chechnya, bringing to the world's television screens a tale of monstrously disproportionate Russian brutality against an ethnic minority that may belong to Russia, but has suffered so terribly for that honor in the past that it demands special treatment.


Apart from the emotional impact this unequal war is having on the Russian and world public, it is also driving a hole the size of the Channel Tunnel through the country's tattered budget. And yet the powers that be -- whoever they may be at the moment -- have done nothing to limit or abate this orgy of unnecessary killing and spending. On the contrary.


Then there is the oil export quota fiasco. Both the IMF and the World Bank have set the lifting of these quotas as a sine qua non for release of nearly $7 billion in aid. The quotas have been lifted, but they have been replaced by a new mechanism for government control over oil exports that is almost certain to nullify the change. Nobody is going to be fooled.


On a less earth-shaking, but symbolically pungent note, the new privatization chief, Vladimir Polevanov, has issued an order revoking all permits held by foreigners to enter the State Property Committee, and severely limiting the prospect of their obtaining one-time passes to the building in the future.


Russia's privatization program -- like that of every other country in the former Eastern Bloc -- has been conducted with the advice and participation of a host of Western experts. Without that input, the momentum of the process is certain to be lost. That, judging by Polevanov's recent comments, is precisely what he intends. Apparently as hostile to foreigners as to privatization, Polevanov has branded foreign investors as a threat to national security.


This way lies xenophobia, isolationism and bankruptcy. It is a road that Russia has taken before. It was 70 years long and led nowhere. President Boris Yeltsin should now consider: Does he want to be remembered as the man who led Russia straight back down such a hopeless path?