EDITORIAL: Please Stop Lying, Mr. Putin!

EDITORIAL

Please Stop Lying, Mr. Putin!

Last month, as Russia posted its worst-ever quarter of economic contraction, Vladimir Putin and his spinmasters were saying the worst was over. They said the economy had hit rock bottom, and would turn upwards in coming months. They said that even though Russia’s second-quarter contraction was a horrifying 10%, the contraction would radically diminish in the second half of the year, leaving Russia with an 8% recession by year’s end and growth in 2010.

It was, of course, all lies.  Though Russia’s economic contraction in July (9.3%) was less than in June (10.1%) compared to one year ago, the figures for August soared back up to 10.5%, the worst performance of the last three months.  Retail sales plunged likewise, their steepest one-month drop in a decade.

Economist Edward Hugh sums it up

The steady and systematic long term mismanagement of Russia’s monetary policy has now created a veritable Procrustean bed of problems for Russia’s economy and society. Failure to address the underlying inflation problem between 2005 and 2008 meant that large structural distrortions were accumulated in the economy, including a massive problem of commodity export dependence, a problem which effectively turned the country into a veritable disaster waiting to happen if ever there should be a protracted lull in the secular rise in energy prices. That lull has now arrived, and it is not at all clear just for how long we will all need to get to learn to live with it.

Ouch. But you wont’ hear any of that truth coming from Vladimir Putin or his economics ministers, who refuse to change their projection on the 2009 contraction by one iota.  Their “strategy” for dealing with the crisis is simple:  A torrent of neo-Soviet lies. 

One truly devastating bit of data, for instance, revealing the brutal impact of the Putin recession on the general population, would be the next census.  So guess what!?  Putin has decided there won’t be a census, at least not until the next round of presidential elections has concluded.  This is the kind of “mismanagement,” which indeed borders on criminality, that Hugh is referring to when he explains how the Russian economy has been hopelessly run aground.  If the people of Russia don’t wake up soon, they will watch Russia go the way of the USSR.

5 responses to “EDITORIAL: Please Stop Lying, Mr. Putin!

  1. The Emperor is wearing beautiful clothes!

  2. And, the bad news keeps on rolling in…. Now, even Russia’s pride and joy is facing bankruptcy. According to the Globe and Mail:

    Kalashnikov faces bankruptcy

    For years, the AK-47 assault rifle has been the world’s most popular weapon, the gun of choice for dictators, gang members and Third World revolutionaries.

    But the global recession and a proliferation of copycats has left the Russian maker of the Kalashnikov, OAO Izhmash, in financial turmoil.

    Monday, a court in Russia said it will consider a bankruptcy application filed against Izhmash by a supplier owed more than $13-million (U.S.). According to reports out of Russia, Izhmash has been losing money for years on its small-arms business and closed its largest gun factory in Izhevsk for much of 2009.

    The company, which makes other military weapons and hunting guns, has blamed its problems on falling orders from the cash-strapped Russian army and a flood of AK-47 look-alikes from factories in China, Bulgaria, Poland and elsewhere.

    By some estimates, copycat versions of the gun outsell Izhmash’s legitimate variety 10 to one.

    Source: http://www.theglobeandmail.com/report-on-business/kalashnikov-faces-bankruptcy/article1296238/

    • Sad but true! Russia’s “pride and joy” is an assault weapon. What a country!

      • Uh-huh. You can even buy in Russia cheesy bottles of vodka in the shape of a kalashnikov. The fate of the kalashnikov, however, is indicative of Russia’s industrial failings: it can’t compete in the production of higher tech, more expensive industrial goods, and it can’t compete either in the production of cheaper, mass produced goods!

  3. The oasis of stability!

    Well, at least there’s always money for the first things first, such as Ramzan’s horses:

    Kadyrov and His Horses Under Fire in Australia
    http://www.themoscowtimes.com/article/383713.html

    Chechen President Ramzan Kadyrov has come under fire in Australia after it was revealed that two of his elite racehorses would participate in high-profile races in Melbourne this fall.

    Senator Bob Brown, leader of the Australian Greens party, said neither Kadyrov nor his horses should be let into Australia because of the Chechen ruler’s brutal politics.

    “If this nasty character were to get his hands on the Melbourne Cup, it would be the lowest point in Australia’s sporting history,” Brown said, the Sydney Morning Herald reported Monday.

    (…)

    A spokeswoman for Australia’s Foreign Ministry said Kadyrov had not applied for a visa, but if he did, it would be hard to imagine him being granted one, the Sydney Morning Herald reported.

    Yet it would be hard to ban the horses from entering, the report said.

    Human rights activists say Kadyrov is running Chechnya as his personal fiefdom with the Kremlin’s consent. They accuse him of torturing and killing opponents in Russia and abroad. In January, Umar Israilov, a former Kadyrov bodyguard, was murdered in Vienna, and in March, political rival Sulim Yamadayev was gunned down in Dubai.

    Yamadayev’s shooting coincided with the Dubai World Cup horse race on March 28, and local police later arrested Kadyrov’s horse trainer on suspicion of involvement in the killing.

    Police also issued an international arrest warrant for a relative of Kadyrov, State Duma Deputy Adam Delimkhanov.

    Delimkhanov and Kadyrov have vehemently denied wrongdoing.

    Kadyrov reportedly has a horse stable in Dubai, and Mourilyan was trained by South African Herman Brown in Dubai earlier this year, Britain’s Racing Post newspaper reported.

    Kadyrov’s passion for racehorses has raised little public interest so far, even after he sent a record 11 of them to compete around the president’s cup in Moscow this July.

    His prizewinning stallion Bronze Cannon took a disappointing fourth in the Moscow race, where Kadyrov mingled with President Dmitry Medvedev and other leaders of the Commonwealth of Independent States.

    Bronze Cannon was bought from British diamond magnate Anthony Oppenheimer, and experts told The Moscow Times that the horse is worth £500,000 to £1 million ($809,000 to $1.6 million).

    Kadyrov, who is also known for collecting fancy cars, said in his first public income declaration in May that he earned 3.5 million rubles ($110,000) last year and that his only personal property consisted of a tiny 36-square-meter apartment and a VAZ-21053 car.

    “I am a poor Chechen,” he told Komsomolskaya Pravda in an interview published last week.

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