Streetwise Professor tips us to a recent report from Reuters which concludes that the Kremlin’s neo-Soviet nationalization of resources has made the country “uninsurable.” The reports states:
Madagascar, Ecuador, Kyrgystan and others have also seen examples of expropriation or effectively forced renegotiation that have worried insurers. However, in some other countries — such as Brazil or South Africa — a slight rise in leftist rhetoric has had less impact on premiums. The industry is particularly concerned over risks in Russia, where extractive projects have become almost uninsurable.
This is what Vladimir Putin has done to his country. It is uninsurable (which means that normal business can’t be done there) and it is mentioned over and over again in the same breath as Ecuador. And in fact, it makes Ecuador look good by comparison. Putin’s Russia is degenerating by the minute into a banana republic, except that instead of fruit Russia has natural gas.
Even as this report was being published, Putin was making outlandishly ludicrous statements about making Russia safer for foreign investment. This means that Putin is either a fool, or a liar. If he really wants to bolster the flagging Russian economy with foreign money, then his ignorance of the basic horrors that economy presents to foreigners is laughably stupid. If, on the other hand, Putin has no intention of allowing anyone, much less foreigners, to influence the Russian economy other than his own dictatorship, then his shameless lies are beneath the dignity of a world leader who asks to sit at the G-8 table.
Dima Medvedev, of course, is no better. He recently told Der Spiegel: “Our values are the same as yours. I don’t see any major differences in terms of freedom and human rights, especially in comparison to the new EU member states.” This has to qualify as one of the most outrageous and laughable falsehoods ever uttered by any world leader. Is Medevdev really unaware of how many times his country has been formally convicted after trial by the European Court for Human Rights of state-sponsored murder and torture? Does he really think foreigners don’t know about this horror, and aren’t terrified of Russia because of it?
How can Russia possibly hope to operate a “normal” economy if it won’t even try to recognize its own faults and reform? It can’t! And the feeble Russian economy can’t survive for long without foreign investment, because it simply can’t generate enough investment capital on its own.