Irina Yasina used to be the vice chairman of the Open Russia Foundation, the largest private Russian organization supporting human rights. Now the government has frozen the foundation’s accounts and shut down its operations; even an orphanage it funds is under threat of closure.

“Only two people remain on the payroll,” Yasina told me on a visit to Philadelphia, “one to liquidate the assets, another to represent us in court.” This saga reflects Russia’s slide back toward authoritarian rule.

How ironic that Russia is hosting the annual G-8 (Group of Eight) meeting of industrial democracies in St. Petersburg in July. Russia is neither a democracy nor an industrial powerhouse. But by accepting the role as host for the G-8 conference, Russian President Vladimir Putin signaled he wanted to be part of Europe. That gives G-8 members the right to remind Putin of club rules.

Vice President Dick Cheney was correct, speaking last week to European leaders in Lithuania, to rebuke Russia for restricting civil society. He was also correct to warn the Kremlin against using its vast oil and gas resources as “tools of intimidation or blackmail.”

Critics have chided Cheney for hypocrisy, noting that America’s democratic image abroad has been tarnished by Abu Ghraib and Guantanamo. Others accuse Cheney of revisiting the Cold War, or ask how we can demand that Russia cooperate on Iran when we criticize the Kremlin in public.

But talking frankly to Russia doesn’t mean a reversion to the 1950s; nor do Bush administration mistakes eclipse the harshness of Putin’s actions. The Russian leader has neutered all checks and balances in the Russian system, muzzled the press, and smothered civil society. He has used energy as a weapon, turning off the gas to neighboring Ukraine, whose leader he disliked.

Yet Putin is a realist – who will cooperate on Iran if he thinks it is in Russia’s interest, irrespective of other issues. It behooves G-8 members to provide Putin with a dose of realism about what G-8 membership means. Club rules don’t include smashing civil society. The Kremlin has issued draconian rules for all nongovernmental organizations. It was especially vindictive against Yasina’s group, which was funded by the former oil magnate Mikhail Khodorkovsky.

Khodorkovsky was sent to a Siberian prison camp for eight years in a clearly political trial aimed at renationalizing Russian oil. Whether or not one agrees with the shoddy privatization of Russian natural resources in the 1990s, this trial was not about benefiting average Russians; it was a warning to independent business magnates that all political power now resides with the Kremlin.

Some Russian human-rights activists say the Kremlin’s message is: “We can do anything and you can’t stop us.” They fear Khodorkovsky, who has already been slashed by another inmate, may be conveniently murdered in prison.

This message of total Kremlin control is conveyed by the new laws governing nongovernmental organizations. Yasina flips through dozens of pages of detailed forms that must be completed by every NGO, detailing each event it holds, and the name and address of everyone who attends. In other words, the NGOs are being asked to do the work of the KGB – and can be shut down if they refuse.

“The Russian government, backed by (state-owned) TV says, ‘We are surrounded by enemies of Russia who want our natural resources,”‘ Yasina says. The Kremlin accuses human-rights groups of spying for foreigners. Many Russians, who are not familiar with the concepts of volunteerism or non-state organizations, believe them.

“People are afraid again,” Yasina says. “Our prisons are waiting.”

This is why the St. Petersburg meeting of industrial democracies is so important. It’s too late to cancel the conference, but unless G-8 members press Russia to sign on to some basic precepts, they would do better to stay home.

Now is the time to press Russia to loosen its NGO law and insist that the Kremlin guarantee energy supplies to its neighbors. Bush should also visit Ukraine on his way home from St. Petersburg.

Putin misunderstands the meaning of the G-8. He thinks Russia’s oil and gas resources buy membership. Who needs democratic values? Either the other G-8 members make clear that black gold can’t buy into the club, or they had better disband the group.

One sign that Russia deserves membership would be when Open Russia reopens its doors.