EDITORIAL: Putin in a Proper Pikalyovo


Putin in a Proper Pikalyovo

Vladimir Putin is nervous. Very nervous. Not only can’t he manage to call his counterpart from Ukraine by her correct name, or even by her Russianized name, or even by a female name, he called her by his name.  Ouch. Shades of George W. Bush.

Why so nervous, Mr. Putin? Are you in a Pikalyovo?

He is indeed. The events two weeks ago in the “montown” of Pikalyovo outside of St. Petersburg betray the fundamental weakness of the Russian economy under dictator Putin, and the mismanagement by ham-handed proud KGB spies that created that weakness.

Pikalyovo depends on aluminum manufacturing, its only commerical enterprise, and the price of aluminum has collapsed by more than half in the past year. The industry is in dire straits, and it’s not alone.  Nearly one-fifth of Russia’s population lives in such “monotowns,” and they are all facing the same fate as Russian industrial production contracts even more dramatically than the economy as a whole.  In a crazed decision last August, one local factory which had previously been producing alumina decided to shift to cement production, processing aluminum waste rather than an ingredient for the manufacturing process. 

There were two serious problems with this decision, made by Kremlin-friendly oligarch Oleg Deripaska:  (a) Pikalyovo already had a cement plant and (b) nobody wants to buy cement in Russia, because nobody is building in the wake of a horrifying contraction of GDP by nearly 10% over the past year.

With no income, Deripaska decided to adopt the classic Russian response:  Don’t pay the workers.  “They pretend to pay us, and we pretend to work,” goes the Soviet joke.  Little wonder that the USSR was, and Russia remains, one of the least productive industrial economies on the planet.

The problems were immediately apparent, and Russian “president” Dima Medvedev ordered the local firms to “come to an arrangement.”  In classic Russian fashion, they ignored him as if he were a child, and Medvedev in turn ignored them.  The situation reached the boiling point, and in early June workers seized control of a major Russian highway, causing a traffic jam that stretched over one hundred miles.

As if confirming Medvedev’s total incompetence, it was Putin who rushed to the scene to defuse the crisis.  He humiliated the owners, including Deripaska, on national television, in a manner eerily reminiscent of the tactics of Stalin.  But as Oxford Analytica reveals:  “The arrangements Putin imposed were far gentler toward the plants’ owners than his harsh rhetoric might have suggested, with substantial subsidies being provided to ease the start of production.”

In other words, it was the Kremlin who picked up the tab, because you can’t get blood from the stone of Russia’s impoverished, ruined oligarchs, wiped out by a stock market that has taken well over half their net worth and a banking crisis that his cut off credit and investment.

Can the Kremlin afford to pick up the tab for one-fifth of Russia’s population?  Of course not.  Russia’s three state-controlled energy firms (Rosneft, Taftneft and Gazprom) have a massive total of $21 billion in debt coming due in 2009 alone.  The Kremlin’s budget revenues are plummeting, and its reserve funds are rapidly plunging towards exhaustion.  The Kremlin can’t even cover its current operating expenses, faced with a 10% contraction of the economy, without going into massive debt to Western lenders.   How can it even consider paying workers to produce output nobody wants?

It can no more do so than the USSR could.  In fact, subsidizing failure and propagating inefficiency to keep up Potemkin appearances is exactly what destroyed the USSR, and it will do the same to Russia. Putin’s neo-Soviet chickens are finally coming home to roost.

26 responses to “EDITORIAL: Putin in a Proper Pikalyovo

  1. Anthony Jeffery

    tragic. Putin is becoming a blue eyed Mobutu

  2. 1 where you were born?
    2 In Zimbabwe сутуация is worse than in Russia. Why you do not write about Zimbabwe?
    3 you write or to you pay?
    To search for me it is not necessary, this is mine ip adress -


    We don’t write about Zimbabwe because we couldn’t care less about it. There are plenty of blogs that deal with that country. And we don’t agree at all that Russia is better. You’ve given no evidence to support your position. Just because Russia is the second worst country in the world doesn’t mean it shoudl ignore reform. Only a fool would offer such advice. A neo-Soviet fool.

  3. nglish-speaking руссофобский the blog “La Russophobe”, being to https://larussophobe.wordpress.com address amazes cheap пропагандисткими with stamps and “exposers of Russia”, getting the knowledge from the western mass media. It is personally difficult to me to argue with them, I am afraid that they simply will not have knowledge to understand, about what I speak. It is result of the “advanced” western formation: absence of system, dogmatism, unwillingness to “dig” in a question.
    To a course there are unreasonable charges and impudent assumptions that Russia without their councils well in any way will not live. And if arguments does not suffice, it is possible to take advantage of universal charge of type “fascist” or “сталинист”. Well, and if at all arguments have ended, old kind psychoanalysis always will help. Projections and reasonings on a subconsciousness theme will always rescue. After all mystifier Freud has taken care of that its pseudoscientific doctrine could explain the most improbable statements.
    The dear Russian patriots who are knowing English, regret illiterate Europeans and Americans. Do not argue with them. They have not got used to think so much (or simply to think). They do not read so much books. More reasonable in dispute with you will receive the second higher education, less reasonable will break to themselves a brain. Guilty to scoff over лишенцами.

  4. Rosneft, Taftneft and Gazprom. You forgot Grand Theft a.k.a Putler,the Kremlin Kleptocrats, and every other miserable bureaucrat in Roosia . Can you imagine having to pay a bribe just to get you bags on an airplane in Russia. 6000 Rubles seems to be the going rate

  5. @andrey
    I happen to be one of those “illiterate” Americans you speak so eloquently of. I live in Russia teaching “Russian Patriots” how to speak English. I wouldn’t throw stones so indiscrimantly with a lack of fundamental knowledge, if I were in your shoes, and were castigating the psychoanalyzed masses of the minds and hearts of people living under “true” democratic principles.

    • Don’t throw big SAT words like “castigate” at this person. He is definitely not one of “the dear Russian patriots who are knowing English.”

  6. andrey,
    don’t rely on google translate! your post isn’t just poor English; it’s really incomprehensible for an English speaking person.

    For example, regret means жалеть (о чем-то). Therefore, “regret illiterate Europeans and Americans” doesn’t make any sense. жалеть (кого-то) means “pity”.

    So, when you are putting such sanctimonious posts in “google translate” English, you come across as an idiot. I am not trying to insult you here – since it’s almost impossible to understand what you are really trying to say (and certainly not worth the time), I have no opinion about your mental skills.

    Hopefully, you will ask somebody with better English to help you in the future. I heard Eugene is looking for some extra income!

  7. I have 2 questions:
    1) In what sense of activity of the newspaper “la rusofobe”?
    2) In what country these people were born?

  8. Andrey,

    1. Not sure I understand your question. Maybe you should just write in Russian. As for your earlier complaint about Western mass media, you might note that the media in the West is not government-controlled, and it represents the full spectrum of opinions on any given subject. I know it must be difficult for you to understand, living in a country where the government kills journalists who dare disagree with its lies.

    2. That’s the kicker, given your earlier inference about us being a pile of uneducated Westerners; we’re actually from several countries, and many of us have lived in multiple countries in our lifetime. As far as I can tell, many of us hold university degrees, some advanced.

    Why waste time complaining about Russia? Are we all just a bunch of bored fools picking on your little Eurasian paradise there? No; Russia has some of the lowest living standards in Europe and — alone among the European countries — that living standard is falling, while at the same time a clique of officers from the ancien régime has seized power in Moscow and are running an authoritarian regime which is quickly sliding into an early 20th century-style dictatorship. This is important to those of us outside Russia because this clique has not given up their old imperialist dreams, and Russia — impoverished, backward, thuggish Russia — still dreams of Empire, which is a threat to all of Russia’s neighbors in Europe and elsewhere. I can assure you that if a cabal of former M15 officers usurps power at 10 Downing Street, undermine the British political system to turn the British government into a dictatorship, start killing journalists from The Times and The Guardian who dare question the cabals’ actions, roll back the British economy to a third world-status raw materials exporting racket (crushing the British living standard in the process) and start wars with neighboring Ireland or France in a pathetic bid to re-establish some long, lost glory of the British Empire, well I’d start a website called ‘the Anglophobe’ as well. However, seeing as Britain today is a functioning democracy which respects human rights, and only Russia fits the description I just gave, I guess we’ll stick with the Russophobe. The moment Russia becomes a true democracy, respecting human rights, and it begins to develop a modern functioning economy that empowers average Russians to make their own financial decisions and raises the Russian standard of living — not to mention the life expectancy, one of the lowest in the world currently — and ultimately Moscow learns to develop equal and normal relations with neighbors like Georgia and Estonia, well on that day I will quit La Russophobe. Really; try me.

    • Hi Tomek,

      You gave a very eloquent response. Unfortunately, it fell on deaf ears because you are speaking to uneducated rooshans, or rooshans that think that there is truth in the Soviet Encyclopedia. The only hope is that true intelligent rooshans read this website and learn about the rewritten history of roosha, rather than to continue the kremlin’s attempt to rewrite rooshan history on a daily basis.

      My Mother said, “Talk to a wall and a wall will remain a wall.”

      PS Keep up the good work. :)

    • Tomek,
      Very well spoken!! Cheers to you!

  9. Leonid Y Krassilnikov aka “andrey” in St. Petersburg, if that is really you, do YOU
    “write or to you pay?”

    I think most of the questions you asked you are capable of figuring out? So other than your indignation because Putin’s Russia is being criticized here what is your point?

    I’d listen to Felix, you need to get a friend or supervisor with better English skills to help you.

    • Penny: who is Leonid Y Krassilnikov? How did you reach this conclusion? Just wondering

      • He gave his IP address above as I put it in one of the many IP address locators on the web and that’s what it came up with.
        I should have linked it then. Trying again I got less information past Russia as the location so who knows.

  10. 1) you have a concrete plan of action that in Russia there was a high standard of living?
    2) That you think of the conflict in southern osetian in 2008????

  11. If to compare to “democracy” 90 s at board путина a standard of living in россии has risen. You ridiculous. You want that the standard of living has caught up england for 10 years? lol

    • Police blackmail

      Before the anniversary of the mop-up, Veronika Shakhova, former editor in chief of the city newspaper “Zerkalo”, conducted a sociological investigation in Blagoveshchensk. To the question: “Can you or your close ones become victims of the arbitrariness of the law-enforcement organs?”, 64% anonymously responded “I have already been a victim” and 32% said “I do not rule out such a possibility”. [Information published based on the data of the first issue of the newspaper “Zerkalo plus”, which has just begun to come out with the financial support of the embassy of the Kingdom of The Netherlands in the RF.] 96% [sic] — that is practically the entire city. And only 1% of the people said: “No, I can not be a victim of the arbitrariness of the enforcers of the law”.

      Click to access Politkovskaya%20-%20Blagoveshchensk.pdf

  12. If I write in Russian you me will understand?

  13. For whom I need to give the voices that in россии the standard of living was as in Britain?

  14. Andrey, this is for you. There are numerous blogs other than here that are critical of Putin’s Russia. Here’s a place to start because a section of it is in Russian.


    • Being a lawyed paid by Khodor’s cronies, he’s hardly an independent and reliable source. His position is already known, and I doubt he can reveal anything new. He’s as interesting and unbiased as, say, the website of United Russia ;-)

    • …Being a lawyer…

  15. this discussion is senseless at the moment,as russia prepares an invasion of Georgia in circa three weeks!!!


  16. “Ouch. Shades of George W. Bush.”

    You are a real Soviet child, aren’t you!

    Totally unable to shake the chains of marxist
    propaganda! Bush is a giant compared to the
    communist buffoons in the White House and the Kremlin!

    He was subject to the most intense hate campaign ever in history
    by the socialists, financed by Muslim oil money.

    Statistics tell us that all Russians will be forced to convert to your beloved Islam in only two

    Good riddance to bad rubbish!!!

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