Russia’s Future

The life expectancy for males in Russia is about 64 years, putting it among the lowest 50 countries… Consider that a 15-year old Russian male has a life expectancy three years shorter than his counterpart in Haiti. __ Demography is Trouble 2015

It is difficult to predict anything — especially the future.

A Few Fundamental Issues to Consider about Russia

Russian Wages are Dropping:

During the January-September period Russian wages were down by an average of 3.3%. Even more worryingly, the decline has shown little sign of abatement. Indeed, wages were down by more in August and September than they were at the beginning of the year, when the economy was performing even worse than it is now.

Russia is Running Out of Usable Reserves:

“Our reserves volume (in 2015) will decrease by approximately 2.6 trillion rubles ($40.85 billion) – more than half,” said Finance Minister Anton Siluanov. “This means that 2016 is the last year when we are able to spend our reserves that way. After that we will not have such resources.”

Most Russia observers over-estimate the size of Russia’s usable reserves:

… reserves look large on paper but are near the minimum safe levels needed to uphold confidence and to cover foreign debt redemptions of Russian companies, running at $12bn to $15bn a quarter. __ Russia Slipping Backward

Some Reserve Funds are Not to be Touched Except Under Total Panic Conditions:

Russia’s other reserve funds — the National Wealth Fund (worth $73.66 billion) and currency reserves ($371.26 billion) — technically are not used to cover government spending. The National Wealth Fund is meant for large infrastructure projects, and the currency reserves are meant to maintain currency and market stability.

Russian Military Spending Breaking Budget:

There are a lot more debts that need to be paid in Russia than are generally admitted:

… with no additional assistance programs or funds earmarked for most of the regional governments in the 2016 draft budget, there is a question of whether the regional governments with high debt will be able to handle their repayments in 2016. And, if it is true that some regions are not paying their federal taxes, the Kremlin could crack down on them as it has done in previous economic crises. If the Kremlin does pressure the regions to catch up on their delinquent taxes, then they will have to pull money from other areas. In the 1998 economic crisis, many regions quit paying schoolteachers and state workers for months, leading to protests. Teachers, doctors and state employees have already held small demonstrations against no pay or salary reductions, but not of the same magnitude as the protests in 1998. __ Stratfor

Russia’s grand international military adventures — when combined with rising weapons procurement budgets — are straining the Kremlin’s ability to pay the bills:

Russia will … likely continue holding a high number of military exercises this next year as NATO expands its presence in the country’s borderlands. However, it is not clear how intense Russia’s operations will be in Syria or eastern Ukraine in 2016. The Kremlin said in September that Russian military operations in Syria will likely last four months, meaning they will end in January. Moreover, the cease-fire in eastern Ukraine is holding relatively well, and Russia could scale back its presence there in a bid to ease EU sanctions. Still, Moscow needs to have the funds ready to ramp back up in either Syria or Ukraine should its situation change either with Washington or Kiev, creating uncertainty over how much will be allocated for operations in 2016.

It is unlikely that Russia could expand its military adventurism while maintaining spending on procurement and maintenance. However, procurement is the one area where the Kremlin could limit spending in 2016. Russia launched an ambitious Rearmament Program, with the goal of spending $770 billion between 2011 and 2020 (an average of $77 billion a year). The program is intended to give the country’s military nearly all-new equipment across all branches after a decade of neglect following the fall of the Soviet Union.__ Tightening the Purse strings

Every item on the Kremlin budget that is cut, will alienate another Putin insider — who was living on the graft from that budget item.

People will eventually grow angry and disaffected if they are not paid their accustomed fees, wages, or bribes for too long a time.

Polls suggest that Mr Putin remains popular but the full force of the crisis has only started to hit home, and he can no longer keep putting off the choice between guns and butter. Real incomes have dropped by 9.8pc over the last year. Food prices have jumped 17pc.

Ivan Starikov, the former deputy economy minister, said the true inflation rate is near 30pc. “We are rapidly approaching the fateful mark where of 50pc of the average Russian family’s income will be spent on food. We have again become a country of poor people,” he said.
__ Things Could Get Dicey

It is not difficult to imagine conditions worsening inside Russia. Russia’s periphery is already depopulating, ethnic Russian women are choosing not to give birth, and the best of Russians are emigrating to greener pastures, taking Russia’s future with them.

[There exists] a “knowledge-creation catastrophe” in Russia, whose people are awarded fewer US patents than those in the state of Alabama, he noted, despite the fact that Russia has a population that’s 30 times larger. Lest you think there’s a US domestic bias there, Russia’s share of international patent applications is just two-tenths of 1%, despite its having 2% of the world population and 5% of the world’s college graduates. __ Rob Preston in Forbes

Putin’s Tragic Miscalculation: Putin’s foolish error that triggered Russia’s accelerating crisis.

Without cash, Russia will have to trade, beg, borrow, or steal innovative science and technology — because she is no longer producing innovative breakthroughs herself.

Looking at Putin’s Russia overall, we see a combined brain drain, capital flight, demographic decline, depopulation of ethnic Russians from the periphery, womb drain, costly foreign military adventurism on multiple fronts, lack of economic opportunity, saturation at all levels by organised crime, growing epidemics of HIV – TB – drug addiction – suicidal despair among the young, economic decline, international isolation on political and economic fronts, growing poverty, looming shortages of vital foodstuffs, a rapid decline of crucial infrastructure of all kinds, a return of Soviet-style totalitarianism, a general crushing of human hope . . . Russia’s future seems cold and gray.

If there were only a way to save Russia’s population of girls and young women . . . at least a part of Russia might survive.

Seeking New Opportunities Can they be saved?

Seeking New Opportunities
Can they be saved?

The spectre of disintegration hovers over Russia, although as much as ten years may transpire before formal fragmentation occurs.

We expect Moscow’s authority to weaken substantially, leading to the formal and informal fragmentation of Russia… To Russia’s west, Poland, Hungary and Romania will seek to recover regions lost to the Russians at various points. They will work to bring Belarus and Ukraine into this fold. In the south, the Russians’ ability to continue controlling the North Caucasus will evaporate, and Central Asia will destabilize. In the northwest, the Karelian region will seek to rejoin Finland. In the Far East, the maritime regions more closely linked to China, Japan and the United States than to Moscow will move independently.

__ Stratfor Decade Forecast 2015 – 2025

__ as quoted in: https://alfinnextlevel.wordpress.com/2015/08/01/russia-haunted-by-spectre-of-disintegration/

Historically, all empires tend toward collapse.

More on the collapse of Russia

It was overreach that doomed the USSR to fragmentation. Putin’s Russia is the very picture of overreach.

Compare Russia’s GDP in $US terms with other nations such as Mexico, Spain, and even the Netherlands — where Russia’s GDP is heading. How long could these other nations economically sustain Russia’s efforts to hold onto its vanishing superpower status? Particularly when it can no longer innovate in science and technology, nor can it maintain a modern industrial infrastructure of production.

It is difficult to predict anything, especially the future. But one can examine the rotten posts, beams, foundations, and roofs of an old neglected building, and make certain assumptions. Particularly when the building is attached to a 5,000 metre high lightning rod, and is infested by mafia/crony termites, and contains vast stores of high explosive placed next to a roaring fire.

More:

Views of a Russian expat techie now living in Singapore The ones who leave are often young, talented, ambitious males — or young, beautiful, fertile females. Either way, Russia loses.

Don’t expect China to bail Russia out. China benefits from a weaker Russia on its northern frontier, and is likely to string Putin along until it is too late to prevent Russia’s fragmentation. At that point, a number of countries are likely to join China in taking back territories previously stolen by Russia, including Japan, Finland, Poland, Ukraine, and several more.

Clever ways that money flees China In just three weeks recently, about $200 billion slipped out of the country.

More:

China acquires border territory from Russia — looks for much more in the near future

Russian mortality rates shoot higher as Putin starves health services to feed military advantures

https://meduza.io/en/news/2015/11/06/vladimir-putin-halts-all-russian-flights-to-egypt

http://www.theguardian.com/world/live/2015/nov/06/tourists-return-from-egypt-amid-reports-bomb-in-hold-downed-russian-airliner-live-updates

Putin has never been so bashful about blaming and counter-attacking muslim terrorists in the past. Even when the “muslim terrorists” were acting under his orders. In this case, a plausible connection between Putin’s grand Syrian Kabuki bombing theatre and the loss of Russian lives in Sinai, can easily be made in the minds of ordinary Russians — no matter what Putin’s pet media and Kremlin trolls are paid to say. If he admits that Isil brought down the Airbus A321 over Sinai, any thinking person will blame Putin himself for the disaster. And that is something that cannot be allowed, at all costs. Something of a conundrum.

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3 Responses to Russia’s Future

  1. I do not totally agree with your assessment of Russia.
    The problem being Russia do not exist in a vacuum.
    Surely its cash and reserves are limited, but the debts are limited too.
    Males life expectancy is short, but this imply, also, lower expenditures for retirements.
    And this short life expectancy is not evenly distributed. It hit more the poor and imprevident, low IQ people than the smart, prevident and high IQ people.
    The US have big problems, per se.
    It is on its way to become Argentina 2.0, with high inflation, a devalued currency and a lot of black people. Its anglo-saxon roots just slow down the process, but didn’t stop it. If, but more when there is an hyperinflation episode, the liquid wealth of the population will wiped out and the middle class will be wiped out completely.

    The hope is in the big innovators, if they are able to develop the technologies to make themselves and others independants from old governments and old nations. Bring the seed of economic growth and innovation and expansion away from the roth and allow it to take root somewhere else. Be it the sea with seasteading, the Antarctic, the space outside Earth or whatever.

  2. “If he admits that Isil brought down the Airbus A321 over Sinai, any thinking person will blame Putin himself for the disaster. And that is something that cannot be allowed, at all costs. Something of a conundrum.”

    Here you are mistaken.
    Russian psychology is pretty different from US (leftist) psychology.
    In Russia, the enemy is shit. There is no compromising, middle ground, or whatever.
    It is just, “You kill mine, I kill you and all of yours and whatever in the middle God help them”

    • alfin2101 says:

      Yes, you do have a point. Kremlin propaganda has proven very persuasive to most Russians so far. It will be a sad surprise to them when reality pokes its ugly head through the Potemkin facade.

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