EDITORIAL
A Russian Economic Picturebook
The Russian economy has taken another plunge deeper into the abyss. In today’s issue below, we carry an essay by Yulia Latynina exposing the more barbaric aspects, and on Monday in our editorial we’ll take a hard look at Russia’s announcement that as a result of Putin’s failures it will be forced to go begging for foreign loans for the first time in ten years. Right now, let’s take a look at some of the stunning statistics that document Russia’s new apocalypse.
Russian Economy Watch states:
In the fourth quarter of 2008 alone, real disposable income dropped 5.8 percent year on year, and by 10.2 percent in January 2009 (again year-on-year). And unpaid wages as a share of total enterprise turnover tripled to 0.12 percent in December 2008, compared with August 2008. The stock of wage arrears as of March 1, 2009 (8 billion rubles or about USD 240 million) remains small but is likely to increase as the crisis grows. At the present time such arrears are thought to affect up to 450,000 people, significantly less than 1 percent of total employment. Growth in real wages came to a complete halt in January-February 2009, following double-digit increases in previous years.
Russian wages are in freefall, with an ever-increasing number of Russians being paid nothing at all by their collapsing employers. But three pictures are worth a thousand screams:
Russia has had double-digit inflation since October 2007. Inflation rose to a five-month high in March as the weaker ruble boosted import prices. The rate rose to 14 percent from 13.9 percent in February, while consumer prices grew 1.3 percent month on month, compared with 1.7 percent in February.
Russian GDP growth has been declining since November 2007 and is now deep in recession, with contraction occurring at a rapidily increasing rate.
Russia's industrial production has contracted at twice the rate of the overall economy and is likely to be further devasted in 2009. It's nowhere near hitting bottom.
These graphics show that Russia’s economic woes are of long standing, dating back to 2007. Yet the ignorant, benighted people of Russia did nothing to hold their government to account for its performance failures, much less did they demand regime change. To no intelligent person’s surprise, the problems only got worse until the KGB regime’s house of economic cards simply collapsed, just like that of the USSR did.
