Russia’s Collapsing Cities

Leon Aron

Leon Aron

Leon Aron of the American Enterprise Institute, writing in the New York Times, details the horrifying collapse of Russian cities from within:

Viewed from the outside, things have been going quite well for Russia recently. The United States has scrapped, at least for now, the plan to base missile defense sites in Poland and the Czech Republic. Germany and Russia seem to have overcome opposition in Europe to their Nord Stream pipeline, despite fears that it will solidify Russia’s dominance of the European natural gas supplies. Oil prices have recovered from the disastrously low — for Russia — levels of last winter. And, far from buckling under pressure from the United States over sanctions against Iran, Russian leaders felt confident enough to concede almost nothing to Secretary of State Hillary Clinton during her visit to Moscow this week.

Yet on the inside the country remains dangerously close to a serious breakdown of authority. In addition to the Muslim North Caucasus, which is already barely governable, the most vulnerable places are the company towns, which could catalyze a nationwide explosion of political turmoil.

Products of Stalinist industrialization, an estimated 460 company towns grew around a single plant or factory. Hence their Russian designation: “monotowns” (monogoroda). Most were erected, often by prison labor, in the middle of nowhere and in complete disregard for long-term urban viability, not to mention the needs and conveniences of the workers and their families. In addition to being the single employer, these “town-forming enterprises” are responsible for providing all social services and amenities, from clinics and schools to heat, water and electricity, for populations of 5,000 to 700,000. (There are also more than 1,000 similar but smaller “workers’ settlements.”)

These crumbling monotowns seem frozen in the 1930s or ’50s; the fat years of 2000 to 2008 have passed them by. Worse yet, many of these places were among the first victims of the plunge in industrial output last year, when production fell by almost 20 percent — a rate of decrease unseen since 1941 and 1942, the years of the Nazi onslaught. As a result, the “town-forming enterprises” have begun laying off or furloughing workers, and salaries have been cut, delayed or unpaid for months.

For most Russian workers, there are unemployment benefits from 850 rubles to 4,900 rubles ($29 to $167) per month. (For those in the severe climate zones of the Far East, Far North and some regions of Siberia, the payments are as much as twice these amounts.) As many as two-thirds of the unemployed seem to be unaware they are even eligible for these payments, so of the estimated 6.5 million unemployed in Russia (nearly 10 percent of the work force) in July, only 2.194 million registered for benefits. And not one of the many reports about or from the monotowns that I have read so much has mentioned unemployment benefits as a source of sustenance.

At the same time, the local administrations in many regions have been of little help, having been bled dry by recentralization efforts during the presidency of Vladimir Putin that redirected 70 percent of local revenues to Moscow. As a result, some grocery stores have been forced to stop offering credit to customers who have not been paid for months. In particularly hard-hit monotowns, people are reported to be eating potato peels and spending their days foraging in forests for roots and berries to consume or sell for a pittance.

In Pikalevo, a monotown of 22,000 near St. Petersburg, citizens grew desperate after the shuttering of their plant, which produced cement, aluminum and potash. There were no prospects for work; people were without assistance of any kind. A resident told a reporter over the summer: “We are eating — excuse me — grass. It’s shameful.” But when the town’s heat and hot water were shut off in May — the cement company had stopped paying the bills — it was the last straw. After an occupation of the mayor’s office brought no relief, angry Pikalevians blocked a major highway.

A few days later, Prime Minister Putin traveled by helicopter to Pikalevo. Russian crisis management techniques haven’t changed much since the days when czars threw boyars off the Kremlin walls to be torn, limb from limb, by rebellious hoi polloi below. With national television cameras rolling, Mr. Putin berated the local administration, plant managers and the plant’s owner, Oleg Deripaska, formerly Russia’s richest man, whose BaselCement conglomerate is now almost $30 billion in debt. He then ordered them to sign a pledge to reopen the plant. “I did not see you sign!” Mr. Putin barked at Mr. Deripaska. “Come here and sign!” (“And return the pen!” Mr. Putin snapped afterward.)

Of course, neither Mr. Deripaska nor the local government will be able to keep an all-but-bankrupt enterprise open for long. And while the Kremlin’s iron grip on the national news media has helped keep the monotowns out of the spotlight, Mr. Putin’s very public intervention in Pikalevo is likely to encourage more protests across the country.

This could be catastrophic: after all, a quarter of the urban population — 25 million people — live in monotowns and produce up to 40 percent of Russia’s G.D.P. And these struggling workers embody Russia’s work force: largely immobile, because the lack of affordable housing makes it impossible to seek employment elsewhere, and sadly inflexible, thanks to their overdependence on these paternalistic, enterprise-based social services, part of what President Medvedev has denounced as the “Soviet-style social sphere.” Indeed, the monotowns seem more and more a bellwether of the national trend toward deepening impoverishment and further job losses.

According to the World Bank, this year the number of Russians below the poverty level has grown by 7.5 million to 24.6 million, or 17 percent of the population. An additional 21 percent, or almost 30 million, have incomes less than 50 percent over the poverty level. Together, that’s 4 out of 10 Russians. The Federation of Independent Trade Unions predicts that up to 400,000 more Russians may become unemployed in the next three months, while the World Bank projects that the unemployment rate there will reach as high as 13 percent by the end of the year.

Moscow has only one obvious option: increase its financial assistance to the monotowns many times over. But there are numerous impediments to making this happen. First, with the memories of the hyperinflationary 1990s still fresh in everyone’s mind, the Kremlin is wisely reluctant to print money and will instead try to stretch its remaining hard currency reserves to plug the growing budget deficit.

Second, though Russia already plans to raise $17 billion by issuing Eurobonds and to borrow billions more from the World Bank, the money will not materialize until next summer at the earliest. The other Group of 20 nations are themselves too strapped for cash — and too politically skittish — to produce an emergency assistance package.

Finally, even if the needed money was miraculously available today, it would take some time to disperse such enormous amounts among the hundreds of monotowns. Which is why the government’s mid-August decision to appropriate 10 billion rubles, or $340 million, for assistance to just half of the communities was not only too little but is too late.

There may, in fact, be nothing that can be done to prevent these ticking time bombs from exploding. And as the Iranian protests recently proved, in an age of cellphone cameras and the Internet, one demonstration in one monotown could ignite a wave of nationwide protests that Russia’s news media could not cover up, its riot police could not properly contain and its government may not be able to survive.

Certainly, this crisis sends a message of utmost urgency to a country still groggy from the oil-boom intoxication of the past eight years: go back to the decentralization and democratization reforms of the 1990s and early 2000s — or face the political, economic and social calamity of the monotowns on a national scale.

In fact, President Medvedev recently outlined a strategic reform agenda to break Russia of its “humiliating dependence” on oil and gas exports and transform an economy incapable of invention and innovation into a world leader in “new technologies.”

Just as helpful for the country’s stability and progress would be the next item on Mr. Medvedev’s agenda: developing a political system that is “open, flexible and internally complex.” This would be a Russia far different from the one that Vladimir Putin bequeathed to Mr. Medvedev — a nation stripped of the much-needed shock absorbers of democracy, including an uncensored news media, a responsible and viable political opposition in the national Parliament and genuine local self-governance.

Mr. Medvedev should act on these plans decisively, now, or else no foreign policy advances or new gas pipelines will prevent the disaster of the monotowns from consuming all of Russia.

56 responses to “Russia’s Collapsing Cities

  1. I wonder why the title here says “cities” but the article talks about “company towns”….

    • What’s the difference? The article mentions all kinds of such urban entities — from 1,000 to 700,000 in population

      • > What’s the difference?

        The difference that when I saw the title, I became concerned that major Russian cities were not doing well. So, I had to press on the link and read the article, only to discover that this is in reality only about those rare towns that rely on one employer, the R. Thus I wasted lots of time.

        Moreover, the situation here in American cities like Detroit is much worse:

        http://en.wikipedia.org/wiki/Rust_Belt

        The Rust Belt, also known as the Manufacturing Belt, is an area in parts of the Northeastern United States, Mid-Atlantic States, and portions of the Upper Midwest. The name ‘Rust Belt’ came about due to the decline of industry in the 1970s, when many of the region’s factories had been closed, and the resulting shuttered buildings were guarded only by rusting gates.[1]

        Joblessness in the region increased rapidly in 2008 and 2009, surpassing 20 percent in some areas.

        Contraction of manufacturing jobs has displaced many workers in this region, particularly in Buffalo, Rochester, Syracuse, and Utica, New York; Pittsburgh, Bethlehem, and Erie, Pennsylvania; Cleveland, Toledo, and Youngstown, Ohio; Detroit, Michigan; Gary, Indiana; Milwaukee, Wisconsin; and Duluth, Minnesota; forcing this area — the focal point on the continent for steel mills and the automobile industry — to diversify or decay.

        http://en.wikipedia.org/wiki/Urban_decay

        Examples of decay

        The car manufacturing sector was the base for Detroit’s prosperity, and employed the majority of its residents. When the industry began relocating outside of the city, it experienced massive population loss with associated urban decay, particularly after the 1967 riots. According to the U.S. Census, in 1950 the city’s population was around 1.85 million; by 2003, this had declined to 911,000, a loss of nearly 940,000 people (52%). In addition, the homeless population has grown, and there are many abandoned structures in Detroit.

        Britain experienced severe urban decay in the 1970s and 1980s. Major cities like Glasgow, the towns of the South Wales valleys, and some of the major industrial cities like Birmingham, Manchester, Liverpool, Newcastle, and East London, all experienced population decreases, with large areas of 19th-century housing experiencing market price collapse.

        Large French cities are often surrounded by decayed areas.
        ——————————

        Btw, the population of Detroit is not 1,000 to 700,000. The Metro Detroit area has the population of 5,354,225.

        • Rare towns?

          As usual Michael/Phobophobe/Ostap Bender is being a retard.

          The “Monocities” and “company towns” are the “backbone” of Russian industry, and they are the exception rather than the rule.

          Their collapse shows the total failure of the Russian manufacturing sector, and the sentencing of millions to poverty.

  2. Eureka. Why Obama could higher Soviet monogorod planners to build green factory cities. These cities would be based around green factories which produced green energy for the regular big cities like Los Angeles.
    I love this line “Most were erected, often by prison labor, in the middle of nowhere and in complete disregard for long-term urban viability, not to mention the needs and conveniences of the workers and their families. In addition to being the single employer, these “town-forming enterprises” are responsible for providing all social services and amenities, from clinics and schools to heat, water and electricity, for populations of 5,000 to 700,000. (There are also more than 1,000 similar but smaller “workers’ settlements.”)” This is just the epitome of central planning and government wisdom. Oh, just live for the collective. The free market is a joke, Ron Bloom said so. He is an advisor to Obama. Anita Dunn likes to read Mao. She also advises the president. I wonder if some out of work Soviet advisors could apply for a job in the Obama Administration and let the monogorod building in America begin.

    • > I love this line “Most were erected, often by prison labor, in the middle of nowhere and in complete disregard for long-term urban viability

      Yes, it will take Russia awile to live down the consequences of 70 years of Communist mismanagement.

    • Way to tie in the Obama reference. From an article that mentions NOTHING about America, you can suddenly dream up some sort of plan of Obama plan to create a simular problem in America, as if we didn’t have enough problems, you think he would actually go find a failed model in some other country and replicate it.

      Some people might have drank Kool-Aid, but I’d like to know what exactly you drank to make you so stupid.

  3. Kolchak- Wow is that you Bill O’Rilley it has to be or else some loser thinks repeating what you said makes them sound smart. Kolchak so any chance you get you insult Obama have you seen that BBC show Connections here’s how it works l you take a number of things that seem unconnected and connect the like jobs = obama wants green jobs =cleaner planet + Employment BUT yours is more like Jobs =obama wants green jobs = Obama born in kenya and secretly is Madame Mao’a child with Stalin and controls the world through his connections with the Reptilian aliens and double crossed them with the Grey Aliens to make green job. It makes no sense what so ever !!!!!! PS: Why don’t we all take El Rushbo’s advice and take some OxyCotin and rum and calm down. Can I get a Mega Dido’s?

    • That’s not the point. Putin is a Statist and Obama is a Statist. The best Statists were those that ran the USSR. They built wonder cities for the communist utopia. Now, the US has a Utopian Statist in Obama who is going to lead us into more misery and suffering through his green Utopian vision. Being Green and clean energy are nice ideals, but you can’t drag a people to your ideals. You’ve got to persuade them.

      • You hate the President of the United States and his policies? Weren’t you the one who told me that, if I don’t like the American policies, I should levae USA?

        Well, now it’s your time to leave. Obama is here to stay, the American problems abroad and with the debt will continue to increase, and the US policies/actions (both foreign and domestic)will be much more sane and modest and more to my liking than to yours.

        Where should you move? You guys usually tell me to go to Russia. In your case, Saakashvili’s Georgia will be a great choice: if we were to beleive the propaganda here, Georgia is the most prosperous and democratic country on the planet. That and North Korea.

        • Well retard, Georgia is certainly much more democratic than Russia.

          And much, much less corruption too.

          And less police violence.

          And a much freer media.

          The list goes on.

        • “Well, now it’s your time to leave. Obama is here to stay, the American problems abroad and with the debt will continue to increase, and the US policies/actions (both foreign and domestic)will be much more sane and modest and more to my liking than to yours.”

          Michael Tal,
          Just for your information, Obama was elected to a four year term, he’ll probably be ousted in a little over 3 years, so he is hardly “hear to stay”. Unless you and your ilk manage to become dictators in America in the next 36 months. The political winds will change after everyone figures out what a bunch of blithering idiots the left really is. The mid-term elections will probably be a nasty surprise for our democrat (socialist) party.

  4. An interesting corollary to the monotown’s near economic collapse is that the oligarch owners are apparently organizing strikes in them to get funds from Moscow. Putin is paying up for fear of the unrest getting out of control.

    http://windowoneurasia.blogspot.com/2009/10/window-on-eurasia-oligarchs-said.html

    Poor Pootie isn’t nearly as clever as he thinks he is in thinking that he could extract the money solely from the oligarch’s wallets.

  5. 10/21/09

    Excuse me Michael Tal – I live in the Detroit area. If you are suggesting that anything in (the former Soviet) Russia is comparable (or better than) Southeastern Michigan you are smoking lots of crack cocaine.

    I have been to Russia. I have seen with my own 2 eyes what a wasteland it is. I have been to St. Petersburg. I have driven to Veliky Novgorod. I wouldn’t trade places with any of the poor souls that inhabit that awful place. I was shown the “nice” parts of town. I wouldn’t wish an existence there to anyone (including my worst enemy).

    THERE IS NOTHING IN RUSSIA THAT IS COMPARABLE TO WHAT WE HAVE IN THE USA. NOTHING!

    The author is making a point of the potential serious problems that lie in the near future. It will come to fruition if corrective action is not taken. You have only tried to change the subject and talk about some story you might have read in some garbage magazine about Detroit.

    Here in Detroit – in the worst economy that anyone could ever dream, people are still surviving (and with their dignity intact). And according to Crain’s Detroit Business Report – the number of millionaires is expected to jump well over 20% over the next 3-5 years! Yes, much lower than other parts of the country, but they are not saddled with 20-30% unemployment (depending on who you believe).

    People are finding a way to survive, and the creative ones are thriving. And don’t throw any B.S. about the rich getting richer and the poor getting poorer. That’s life. Get over it.

    Maybe instead of eating grass over in Russia, they might try smoking it. Maybe this will enlighten the creative ones over there and some positive change might be possible.

    Michael Tal, I suggest you do the same.

    You’re Welcome!

    Call me Mr. Jones

  6. > Yes, much lower than other parts of the country, but they are not saddled with 20-30% unemployment (depending on who you believe).

    You are a very ignorant man, Mr. Jones. Not only do you know nothing about Russia, but you know nothing about your own state of Michigan:

    http://www.mlive.com/business/mid-michigan/index.ssf/2009/07/flints_unemployment_rate_hits.html

    Flint’s unemployment rate hits 27.3 percent in May

    July 16, 2009

    FLINT, Michigan — The city’s unemployment rate hit 27.3 percent in May. Michigan’s unemployment rate in June hit 15. 2 percent.

    http://www.associatedcontent.com/article/231606/flint_michigan_home_of_unemployment.html

    Flint, Michigan – Home of Unemployment Since 1981

    Flint’s Best Kept Secret

    Flint was once home to thousands of hard working families, prideful businesses, and a General Motors plant- it was a city of tremendous highs. Now Flint is nothing but a shell of its former self, a city as dark as its stone cold namesake.

    My hometown is the result of all that is wrong with America’s autocracy; it is the nuclear wasteland of our country’s power hungry leaders.

    Flint, Michigan serves as a sullen reminder of what used to be the heartland of American entrepreneurial patriotism. We used to live in a respectable city; a place where you could make a living and raise a family. Now the street corners are occupied by the homeless. Now nearly one out of every four people are without a job. Now the memories of the forgotten children hang visibly over the cityscape, looming over the town in gray clouds of factory smoke, comforting the people in a security blanket of long-deceased dreams.

    WIKI: Flint is a city in the U.S. state of Michigan, 66 miles (106 km) northwest of Detroit, population of 124,943, making it the fifth largest city in Michigan. Of the nearly 80,000 people that worked for General Motors in Flint during its peak years in the late 1970s, only about 8,000 are left. The per capita income for the city was $15,733. About 22.9% of families and 26.4% of the population were below the poverty line, including 37.4% of those under age 18 and 13.4% of those age 65 or over.

    http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita

    List of countries by GDP (PPP) per capita

    57 Russia 16,100
    ————

    Thus, average Russia has a higher per capita income than Flint, Michigan.

    > You’re Welcome!

    You too.

  7. Now Phobodunce, you have to remember that there are 2 Russian peoples, the mega rich, and the super-poor.

    Russian Income averages are massively skewed by the small number of mega rich.

    “Our estimates show that poverty rate for Russia in 2003 was 48.5% which is higher than the
    Rosstat estimates based on survey of households budgets (OBDH). Households with children show to have higher than average poverty incidence rates: 54% for households with one child, 65% for households with two children, and 81.7% for households with three and more children. Severity of poverty is also higher than sample average for families with children. Households of pensioners
    show not higher than average poverty rate and even lower than sample average severity of poverty.
    Families with a university degree holder have smaller poverty rate (34%) and severity of poverty.
    Families with no members with secondary professional or higher professional degree show higher values of both poverty measures.”

    Click to access WP84Denisova_Kartseva_2005_modified.pdf

  8. 53 billionaires, £100bn in the black, but for Russia’s poor it is just getting worsePetro-dollars fail to trickle down to pensioners, jobless and government workers

    Luke Harding in Oryol
    The Guardian, Thursday 15 March 2007
    Article history

    Standing in his fetid kitchen, Sasha Ivanovich shows off a bucket of muddy potatoes. Dug from his snow-encrusted garden, they are his lunch. In fact they are his supper too as, he points out, he has nothing else to eat.
    “Everything has got more expensive. Bread has gone up. Cigarettes have gone up. My sister pays my gas bill. I can’t afford vodka. Can you give me 100 roubles [£1.97]?” he asks, hopefully.

    Since Vladimir Putin took power seven years ago, Russia has enjoyed growing prosperity. The days when the country was forced to borrow billions from the IMF, devalue the rouble, and beg for international help are a fading Yeltsin-era memory.

    Instead, Russia has so much money that it doesn’t know what to do with it. Last month President Putin boasted that the country had paid off its $22bn (£13bn) foreign debt. Rising oil and gas prices have transformed its economic fortunes and made it a resurgent global force.

    The Kremlin is now sitting on a vast mountain of cash, coyly known as the stabilisation fund. Last week it topped $103.6bn. (Others suggest Russia’s total surplus is more like $300bn.) And the American magazine Forbes recently revealed that Russia has 53 billionaires, 20 more than last year.

    Unfortunately none of this has trickled down to Sasha, 56, who lives alone in a wooden cottage, and whose poor sight renders him unfit for work. Like many at the bottom of Russia’s pile, Sasha survives not through the generosity of the state but thanks to his kindly neighbours.

    His home, in the village of Lavrov, is a 45-minute drive from the town of Oryol in south-west Russia, past forests of silver birch. The young people have all left and most of the older men appear to have died – hardly surprising in a country where male life expectancy is 58. Like much of rural Russia, Lavrov appears to be on its last legs, along with many of its remaining citizens.

    “It was much better during Soviet times,” Tonya Fominyh, 79, says. “Pensions were small but equal. We lived well. Now our pensions are nothing.”

    Mrs Fominyh receives 1,540 roubles a month from the state. She spent three decades working for the Soviet police force but now survives on handouts from her son.

    So far few of Russia’s petro-billions have found their way to society’s poorest groups: pensioners, the unemployed and government employees, including teachers and hospital workers.

    This month Russia’s orthodox church warned that the gulf between the rich and poor was growing wider, with some 20% of Russians below the poverty line. There is still no real middle-class and there is a significant gap between urban and rural life, the church said, warning: “Russia possesses between 30% and 40% of the earth’s resources. Revenues from exports of natural resources built the stabilisation fund. But only a very small part of society is getting richer. It is doing so at a pace that amazes even some of the richest people in the world. On the other hand, the majority of the population lives in destitution.”

    It is not only pensioners in villages who are hard up. Sitting in her tiny flat in urban Oryol, Tatiana Tsherbakova gazes at a giant photo of a sun-kissed beach pasted to her living room wall. It is the Canaries, one of many places Mrs Tsherbakova, 68, would like to visit. “I don’t have the money to travel,” she explains. “It’s my great passion. I’ve always wanted to see Vladivostok. But the train ticket is too expensive.”

    This is one of the strange ironies of post-Soviet Russia. Thirty years ago Mrs Tsherbakova was not allowed to travel to the west, but she took advantage of cheap internal fares to roam across the Soviet Union, holidaying in Moldova, swimming in the Black Sea and hiking in the Kazakh mountains. Now she is free to travel anywhere, but on her state pension of 5,600 roubles a month she cannot afford to.

    Kremlin economists say they face a dilemma. It is impossible to raise pensions significantly, they argue, without increasing inflation, currently running at 9%. They also point out that Russia’s 38 million pensioners claim their pensions much earlier than western Europeans – at 55 for women and 60 for men.

    “I don’t believe this [argument about inflation] to be true,” said Natalia Rimashevskaya, a poverty expert at Moscow’s Institute of Social and Economic Studies of Population. “At the moment 30% of all salaries are below the minimum needed to live. Pensions are very low. The average is 2,500 roubles. This leaves pensioners on the edge. If prices go up, they fall into poverty.”

    At his annual press conference last month Mr Putin said that reducing social inequality would be one of his key tasks before he leaves office next year.

    Average salaries have gone up significantly under Mr Putin. But the statistics conceal the fact that for millions, wages have hardly changed at all, Ms Rimashevskaya said. One of the biggest problems, she added, was the tax system, which saw oligarchs and road sweepers paying an identical tax rate of 13%.

    In numbers

    Estimated value of Russia’s so-called stabilisation fund $103bn

    The number of billionaires in Russia 53

    Amount of foreign debt paid off $22bn

    The average monthly pension £50

    Proportion of salaries considered to be below the minimum needed to live 30%

    http://www.guardian.co.uk/world/2007/mar/15/russia.lukeharding

  9. Andrew wrote:
    > there are 2 Russian peoples, the mega rich, and the super-poor.

    Mr. Jones wrote:
    > Here in Detroit … And don’t throw any B.S. about the rich getting richer and the poor getting poorer. That’s life. Get over it.

    Looks like the two of you should have a big argument over this.

    • I am just stating that the statistics can be easily thrown out by a few mega rich.

      Russia has one of the worst income gaps in the world, beaten only by India and China.

      The overwhelming majority of Russians live in poverty.

      Try reading the reports, or are you too retarded?

  10. Maker Of Lada Cars Slashes 27,000 Jobs
    1:42pm UK, Thursday September 24, 2009

    The maker of the popular but much-derided Lada car has announced mass layoffs of 27,600 staff as part of an emergency plan to combat diving sales.

    Carmaker has been hit by slump and competition from foreign imports

    The intended cuts represent more than one quarter of the 100,000-strong workforce at Russia’s largest carmaker Avtovaz, which is 25% owned by France’s Renault.

    The company said in a statement: “Today, 102,000 people work at Avtovaz.

    “Such a number cannot guarantee effective and profitable production, therefore we have agreed to reduce the personnel by 27,600 people.”

    The job cull, which includes the loss of 5,000 white-collar positions announced last week, corresponds to a lower output target of half a million cars per year.

    Russia had the fastest growing car market in Europe up until last year but was then plunged into crisis by the slump in domestic demand.

    With huge amounts of unsold stock, Avtovaz has imposed month-long production halts at its factory in the Volga region.

    The announcement capped a black month for Russia’s labour market as statistics showed production still declining in Russia’s once-booming industry.

    Reports last week said Gaz – Russia’s number two car firm and former owner of collapsed UK vanmaker LDV – plans to slash 14,000 jobs by the end of the year at factories in its Volga River base of Nizhny Novgorod.

    The survival of both car giants, which once dominated the Soviet car industry, is a vital policy issue for the Kremlin amid worries over unrest at factory towns.

    Moscow has already provided about half a billion pounds in interest-free loans to keep Avtovaz afloat and has also given millions in state aid to Gaz.

    Gaz, has also been mooted as a possible partner for Magna, the car parts firm that has agreed to buy Vauxhall.

    http://news.sky.com/skynews/Home/Business/Lada-Maker-Lays-Off-27600-Staff-Russian-Carmaker-Avtovaz-Hit-By-Dive-In-Sales-And-Drop-In-Demand/Article/200909415388470

  11. Andrew wrote:
    > Russia has one of the worst income gaps in the world, beaten only by India and China.

    Your non-stop fabrications continue, eh? Russia and India happen to have very modest income gaps by world standards. Moreover, Russia and India are better than USA. Russia is 56th out of 134 countries surveyed, India is 79th, USA is 44th worst.

    Here is the ranking from worst to best:

    https://www.cia.gov/library/publications/the-world-factbook/rankorder/2172rank.html

    17 Hong Kong 53.3
    30 Singapore 48.1
    36 China 47.0

    43 Uruguay 45.2
    44 United States 45.0
    49 Turkey 43.6

    56 Russia 41.5
    79 India 36.8

    Even your own Georgia and New Zealand are no different:

    Georgia 40.8
    New Zealand 36.2

    That’s why I no longer reply to you: you are a pathological liar, and virtually everything you say is a fabrication.

    • Now retard boy, not a fabrication at all.

      Look how many Russians live on benifits and below the poverty line, and at all the millionaire and billionaires in Russia.

      Desides 56 out of 133 is still pretty bad.

      However, try reading

      Click to access WP84Denisova_Kartseva_2005_modified.pdf

      Most Russian regions have poverty levels of around 40 to 60% according to this RUSSIAN report.

      In addition I find it interesting how you quote the CIA factbook, while constantly harping on about the failure (you say lies) of the CIA regards Iraq’s WMD.

      You also forget that the CIA factbook uses an adjusted scale.

      • > Desides 56 out of 133 is still pretty bad.

        So, you admit that you have falsified again?

        > while constantly harping on about the failure (you say lies) of the CIA regards Iraq’s WMD.

        I did? Where did I say anything about the CIA’s “failure” or “lies” with “regards Iraq’s WMD”?

        I blame Bush, Cheney and Powell for lying, not the CIA. The CIA is the most knowledgeble organisation.

        Are you accusing the CIA of willfully fasifying the Income Gap numbers for India, Russia and USA? Prove it.

        In any case, I broke my rule not to reply to you, received yet another barrel of your falsifications, so I am back to not responding to you, unless I find anyhting extreemly funny in oyur posts. Goodbye (again)!

    • Give up immediately from his words, otherwise Bush will come to you at night with a chainsaw and steal your soul! Repent now!

  12. Wealth and poverty in modern Russia
    By Vladimir Volkov and Julia Denenberg
    11 March 2005

    Since the beginning of the year, protests have been under way, primarily by pensioners, against the transformation of social benefits into substantially smaller cash payments. (See: “Russia: wave of protests against welfare cuts,” 27 January, 2005; and “Russia: Putin lays siege to social benefits,” 21 September, 2004.)

    http://www.wsws.org/articles/2005/mar2005/russ-m11.shtml

  13. Millions more Russians shunted into poverty• Huge rise in number living on less than £110 a month
    • Decade of relative wealth under Putin wiped out

    Luke Harding in Moscow
    guardian.co.uk, Monday 31 August 2009 19.08 BST
    Article history

    The stark social cost of Russia’s economic crisis was exposed today when new statistics revealed a 30% increase in the number of people living in poverty.

    According to Russia’s state committee on statistics, the figure for Russians living below the poverty line went up to 24.5 million during the first three months of this year – a steep increase from 18.5 million by the end of 2008.

    The rise follows years in which Russians saw their living standards improve under the former president Vladimir Putin (now prime minister), largely thanks to a buoyant oil price, and Russia’s status as the world’s largest gas exporter. This improvement has now come to a juddering halt.

    Instead, more Russian families than ever before are sliding into poverty – defined as an adult income of less than 5,497 roubles, or £110, a month.

    Writing in Kommersant newspaper the economist Dmitry Butrin said that Putin’s relative success in fighting poverty over the last decade had been reversed. “The official poverty rate has gone up by precisely 6 million people. All of the gains in fighting poverty during the period 2000-2008 have been utterly wiped out,” Butrin said.

    Russia has suffered as much as any major economy by the global crisis; its economy shrank by about 9.5% in the first quarter of this year. It has pumped millions of dollars into bailing out its banking sector and helping strategic businesses, many of which are owned by well-connected oligarchs.

    http://www.guardian.co.uk/world/2009/aug/31/russia-economy-poverty-increase-putin

  14. To study whether the regional variation in poverty is related to the level of poverty, we group regions into four categories: regions with very high poverty rate (more than 60%); regions with high poverty rate (50-60%); regions with modest poverty rate (40-50%), and regions with low poverty rate (less than 40%). We then test for factors that determine poverty rate and severity of poverty in the four groups of regions, using logit regression for poverty rate and tobit regression for severity of poverty analysis.

    Click to access WP84Denisova_Kartseva_2005_modified.pdf

  15. > Georgia: much, much less corruption too. And less police violence. And a much freer media.

    Of course. No police violence at all. And total freedom of the press:

    Wikipedia on Human Rights in Georgia (translated by Google Translator)

    Human Rights in Georgia

    In November 2007, to quell opposition protests the government used Special Forces troops. Nov. 7 special forces started shooting at them with rubber bullets and tear gas. Then the police began to pursue fleeing people, beating them with clubs, kicked and beaten with sticks. Hospitals Tbilisi were taken hundreds of victims. Human Rights Watch: “Georgian authorities launched a line when police chased and beat peaceful demonstrators and terrorized journalists.”

    Among the police were beaten opposition leaders, journalists and the Ombudsman Sozar Subari, who said: “I saw people lying beaten with batons. He tried to stop them, but I was very badly beaten “,” Georgia has become a country where human rights are not protected at the elementary level. ”

    The same day, several hundred armed police raided an opposition television station Imedi. By threatening to assault rifles, the police ordered to lie on the floor, journalists and TV personnel. Broadcasting was interrupted when tried to talk about leading the attack on the air. Most of the studios of the channel and much of the equipment were destroyed. Against the crowd in front of staff and sympathizers was again used riot police who used tear gas, rubber bullets and batons.

    In June 2008, Subari called the parliamentary elections have “the worst in the history of Georgia, in his opinion,” this election administrative resources was presented at a maximum level, which previously had been unimaginable even a “.. As he said at a press conference on June 4 Subari, “Over the past 12 days have been beaten 12 people, including one woman. Yesterday, I personally visited several people beaten up and saw that they, in fact, condemned to death. “. The Ombudsman, stressing that in the past year have been closed several TV and radio stations, summed up: “The main purpose of dealing with critically-minded people to the authorities is not so much a punishment as intimidation of the population. Once again I repeat what I said earlier – a gross violation of human rights by the authorities adopted a systematic and has become the norm of life. ” Georgian opposition also gave an extremely negative assessment of past elections: the opposition were pogroms, in particular, by unknown masked men had been beaten by the chief press-service of staff of the opposition in Kobuleti. The opposition believes that the Central Election Commission of Georgia is fully controlled by the authorities and falsify the election results in her favor.

    Georgian opposition politician and presidential candidate countries Natelashvili, whom authorities accused of conspiracy: “… this is not a man. It -” Chemical Misha. “Chemical Misha” has declared war on his people. He applied against the thousands of people in central Tbilisi, chemical weapons , plastic bullets and psychotronic weapons, which cause depression, panic, and, as experts say, could affect the health of people in the future. Because this “president of the chemical” causes hatred throughout Georgia. ”

    In 2007, former Georgian Defense Minister Irakli Okruashvili accused Saakashvili and his entourage of corruption, describing the president as a “modern day Adolf Hitler, who was only interested in his own persona and career.” On September 25, 2007, Okruashvili ‘unleashed criticism on President Saakashvili, accusing him of corruption, incompetency and human rights violations. He also raised new concerns around Zurab Zhvania’s death and personally accused the Georgian president in planning the murder of businessman Badri Patarkatsishvili.

    Georgian MP Kakha Kukava said that the Georgian leadership – “is one big corrupt, mafia system.

    In July 2008 Natelashvili asked the EU Commissioner for Foreign and Security Policy Javier Solana on political asylum for his family. According to Natelashvili, this is due to the fact that in Georgia, ruled by secret services and not even dream of democracy. “

    • Now retard, try again in 2007 Freedom House report on Media freedom

      120 Colombia 57 Partly Free
      Georgia 57 Partly Free

      Meanwhile Russia is somewhat further down the list.

      164 Azerbaijan 75 Not Free
      Russia 75 Not Free
      166 Brunei 76 Not Free
      Kazakhstan 76 Not Free
      Swaziland 76 Not Free
      Tajikistan 76 Not Free
      170 Burundi 77 Not Free
      Ethiopia 77 Not Free
      Gambia 77 Not Free

      And in 2009 from Reporters without Borders:

      75 Kosovo 16,58
      76 Nicaragua 16,75
      77 Montenegro 17,00
      78 Croatia 17,17
      79 El Salvador 17,25
      80 Central African Republic 17,75
      81 Georgia 18,83

      Meanwhile Russia is still failing far, far behind

      153 Russia 60,88
      154 Tunisia 61,50
      155 Brunei 63,50
      156 Libya 64,50
      157 Rwanda 64,67
      158 Equatorial Guinea 65,50
      159 Pakistan 65,67
      160 Uzbekistan 67,67
      161 Palestinian Territories 69,83
      162 Sri Lanka 75,00
      163 Saudi Arabia 76,50

      So dickhaed, try and lie your way out of that one.

    • Part 1: Political and Human Rights Conditions

      The Russian Federation has an increasingly controlled political system, with power concentrated in the offices of the president and prime minister, largely unchecked by a compliant legislative branch and politically influenced judiciary. A weak, multiparty political system, abuse of administrative resources by ruling party members, impediments to the registration of opposition parties and candidates, corruption and selectivity in law enforcement, use of anti-extremism legislation to intimidate government critics, media restrictions, and harassment of some NGOs has eroded the government’s accountability to its citizens. The March 2008 election for president, assessed to be not free and not fair, as reported by independent Russian and European observers, was marked by problems during the campaign period and on election day. The overall human rights situation is poor. The state itself engaged in numerous abuses and was ineffective at preventing others. The government’s human rights record remained particularly poor in the North Caucasus where government security forces have been involved allegedly in unlawful killings, politically motivated abductions, and disappearances in Chechnya, Ingushetiya, and elsewhere in the North Caucasus.

      Government pressure weakened freedom of expression and media independence, particularly of the major television networks. Violence against and killings of journalists remained a problem, and many cases remained unresolved; these factors combined with government pressure contributed to intimidating some journalists into practicing self-censorship. The government limited freedom of assembly, police sometimes used violence to prevent groups from engaging in peaceful protest, and the government limited freedom of association. Independent media, political parties, NGOs, and civic groups face selective application of laws, tax auditing, and other regulations that increase their administrative burden. The government restricted opposition political parties’ ability to participate in the political process. Authorities exhibited hostility toward, and sometimes harassed, NGOs involved in human rights monitoring as well as those receiving foreign funding. Prison conditions were harsh and frequently life threatening, law enforcement was often corrupt, and the executive branch allegedly exerted influence over judicial decisions in some high-profile cases. During the year there was a steady rise in xenophobic, racial, and ethnic attacks and hate crimes, particularly by skinheads, nationalists, and right-wing extremists, including some incidents of anti-Semitism. Violence against women and children, trafficking in persons, and instances of forced labor also have been reported.

      http://www.state.gov/g/drl/rls/afdr/2009/eur/122927.htm

  16. Forbes’s billionaires list and the growth of inequality in Russia
    By Vladimir Volkov
    3 April 2006
    The American business magazine Forbes recently published its list of the world’s billionaires for 2005, which included 33 Russian citizens, illustrating once again how the political life of contemporary Russia, under the leadership of President V. Putin, is aimed, first and foremost, at the satisfaction of the interests of post-Soviet big business and oligarchs.

    http://www.wsws.org/articles/2006/apr2006/russ-a03.shtml

  17. 10/22/09

    Wow!! Sorry Michael Tal. Very sorry. I did not know your english wasn’t that great.

    Lets examine your problem once again. You are defending Russia by stating the problems of one American city.

    By the tone of your message I can discern your disgust for your own country. You must feel awful that you have no control over your future and worst of all the feeling that there is no hope whatsoever, and that is very sad.

    You see in America, it isn’t too difficult to pull ones self up by their own bootstraps. There is always hope and there is a reason to get up every morning.

    I did not see that in Russia. I saw a miserable class of people with no chance of ever advancing beyond a few hundred or thousand Rubles per month. If it were up to me I would let in as many Russians or Ukrainians or for that matter any of the former Soviet states people into the United States. I believe that living under a different system would benefit many of your country men and women.

    While I was in Russia I don’t think I ever met someone who wouldn’t trade places with me. It was very sad, and I was not prepared for what it would do to me emotionally.

    It is even more sad that your own government is slowly sliding back to its old (Soviet) ways and I fear for your personal safety and the safety of your loved ones. You see, a government like yours cannot survive without the oppression of its’ people. Every time a new leader emerges in Russia they seem (to me) to be worse than the previous regime.

    Let me say that no country is without its flaws, and the USA is no exception. But at least here, everyone has not one chance, but as many chances as they are willing to take. Just ask any of the millions of millionaires here that didn’t inherit their money. I’m sure you will hear that they failed and failed until finally getting something right.

    Many of them did it under what seems like excessively high taxes, or a Repubilcan or a Democratic President, or any other obstacle that might seem like too much to overcome. But they did it. The American dream is always alive and well (despite the propaganda you are probably fed daily). I really feel your pain Michael Tal. I pray for you and your family and wish for you to do whatever you can to get out of Russia if you are able.

    There are still some in America that welcome all comers (provided you do it legally).

    Call me Mr. Jones

  18. Mr. Jones,

    I am an American citizen. I have lived in USA since childhood. If you don’t like my English – that’s becasue I am typing too fast, And, btw, some of your own use of the grammar doesn’t look right to me (like “depending on who you believe”).

    I happen to have a PhD from Stanford and to be quite successful. And I enjoy living in Northern California close to my 3 kids. And I do travel to Russia regularly.

    I am of course very concerned about the fate of one-employer cities, be htey in Russia or in USA, like Flint, Michigan. What irritates me here is that the blog owner and most visitors here are interested in the troubles with Russian cities not because they want to help, but because they want to gloat and to reassure themselves that their own miserable lives aren’t as bad as they are.

    • I would love to see a non agressive, democratic Russia that does not inflict massive suffering upon its own people and its nieghbors.

      However, I can’t see it happening, certainly not with scum like yourself supporting the regime.

  19. Hey, Tal, you idiot, you can be just about anything you want to make up on the internet.

    Judging by your pedestrian comments and snarky attitude you sure don’t have a PhD in anything. You aren’t very well educated. Stanford might employ you as a janitor, the closest you’ll ever come to a physical presence there. The dead giveaway is all of the time on your hands to post lame comments here. Not exactly befitting your grandiose bio, is it.

    Clean up the pizza boxes that litter your bedroom, take the trash out for mom once in a while and get a job. The profession that you’ve made out of posting here isn’t working out that well for you, well, except for all of the attention you get.

    Anyone really think that responding constantly to this homegrown American loser with all of his bs is a service to having an intelligent dialogue about Putin’s Russia?

  20. Oh, and, Tal, I’m betting you live in a trailer if not with mom and are late on a lot of payments, buddy.

    “I happen to have a PhD from Stanford and to be quite successful. “

    With grammar like that are you sure you have a GED?

  21. By the way all the official unemployment data that comes from the government of rasha is bogus.Last week I spoke to my friend in St.Peterburg. Her son hasn’t been paid for 5 months already but can’t get uneployment benefits because he hasn’t been fired and is required to show up for work with promises of may be payments. This is your great rasha, Tal.

    • This is not the first time I hear about people working and not being paid. Maybe it’s a stupid question, but I am wondering why wouldn’t a worker in this situation go to court? They have regular courts, don’t they? I understand that when politics is involved, the judges are powerless and do what they are ordered.

      But in a non-political garden variety breach of contract case, isn’t there any judicial recourse? Why don’t they sue? They are probably afraid of something, are they not?

  22. You have nothing else to do how to discuss Russia and Putin? Disputes are underway with taco stress that it seems as if Putin tomorrow to break into your house and will kill you and your loved ones … In some ways Tal on your rights.

  23. Hey, Victor SHM, you are Tal, you fool, No need to address him in the third person.

    • Penny,

      You’ve already accused every single non-russophobic person here, including Corey, of being me. I must have really gotten under your skin.

      Just ask Kim to check IP addresses to see if we are all the same person or not.

      But in any case, it’s time that you check into a hospital for a few months to get treated for paranoia, russophobia and conspiracy phobia.

    • penny, that you are the smartest?

  24. Hey, Tal, I’ve called you and your buddy Viktor SHM out as liars.

    You’ve posted ad hominem attacks on others here, what goes around comes around.

    One more time, Stanford PhD’s have better things to do than monitor and speed post drivel with bad grammar on a blog all day. You are a liar. And, your mom could use some help around the house. So, why don’t you drag your sorry ass away from the keyboard and give her a hand.

    I personally wouldn’t discuss the weather with you, but, I’m pretty discriminating, you can post here all you want. It’s not my blog. I’m just putting it on record that you are a liar.

    No need to repond, that’s about all I have to say to you.

    • > Hey, Tal, I’ve called you and your buddy Viktor SHM out as liars.

      Really? What else is new with you today? How was your stool? Still constipated? Try Lifeway Russian-style kefir: it helps with digestive problems.

  25. эй, чувак, хорош гнать пургу, сам ты нихуя не разбираешься во всем этом, так что хорош пиздеть!

  26. what exactly Tal lied?
    and that’s enough to pester mom Tal!
    he is cleverer than you …

  27. I guess I’m just curious as to how ‘helpless’ these people became. Just potatoes from his garden? Didn’t the guy grow anything more? Doesn’t he know how to can or otherwise preserve anything? What about bartering for what he needs? Certainly these people are not so unskilled and stupid they can’t start fending for themselves and to hell with the government? If I recall, the ‘black market’ was more lucrative during soviet times than the actual governmental markets. Well, they couldn’t have forgotten how to conduct their own markets since then.

  28. hi!,I love your writing so a lot! share we maintain up a correspondence much more approximately your post on AOL? I require a expert on this area to resolve my problem. Maybe that is you! Searching forward to peer you.

  29. fairly beneficial material, all in all I image this is worthy of a guide mark, numerous thanks

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