Over on the powerful and influential American Thinker blog, LR publisher and founder Kim Zigfeld shows why Putin can’t win in the Caucasus and therefore his only response to the Volgograd bombings will be to continue working hard to silence his critics with the neo-Soviet politics of repression. Amazingly, Putin has still not made any effort to address his fellow citizens about the terrifying wave of attacks sweeping Southern Russia as the Sochi Olympics draw near. This is a dereliction of duty in the highest order, and shows Putin has nothing to offer his country other than a return to the failed Soviet past.
Vladimir Putin and his ally Edward Snowden have launched a new level in Russia’s anti-American New Cold War. Over on the powerful and influential American Thinker blog, LR publisher and founder Kim Zigfeld has all the details.
Recently there have been two big pieces of news were the Russian ruble is concerned.
First, the Kremlin announced it had decided on a new symbol for the currency.
Second, the ruble continued inching towards a historic law value against the U.S. dollar.
As shown in the chart above, back in 2008, before the ruble experienced a massive drop in value due to the global economic downturn and the falling price of oil, one Russian ruble would buy you 0.045 U.S. dollars.
Today, that ruble will only buy you 0.030 U.S. dollars; in other words, since 2008 the ruble has lost a whopping one third of its value against the dollar.
The ruble now is precariously close to to the value it had at the very depths of the 2009 recession, when it plunged to a value of about 0.028 dollars.
So basically, the Kremlin is fiddling while the ruble burns. Instead of undertaking structural reforms that might bolster the Russian economy, the Kremlin is occupied with ridiculous marketing gestures designed to paper over the structural cracks so they can be ignored. It’s a neo-Soviet “policy” that has no chance of success.
With the Russian economy in freefall, rather than offering parachutes to his countrymen the Russian dictator Vladimir Putin is doling out anvils. He has the country racing full speed towards neo-Soviet collapse.
Russia posted 3.4% GDP growth in 2012, and earlier of this year the World Bank had projected economic growth for Russia of 2.3% for 2013.
That was then.
Last week, the World Bank concluded that Russian growth this year would be a stunningly anemic 1.3%, only slightly more than one-third what Russia achieved last year and just over than half what the World Bank had predicted for this year. Russia’s failing stock market is reflecting the wider economic malaise.
What’s more, the World Bank has cut projected growth for Russia in 2014 from 3.1% earlier to just 2.2% at present. If 2013 is any gauge, one can expect that projection to once again be far too optimistic, as last year’s was.
But even at 2.2%, Russia’s numbers would lag far behind the other members of the BRIC group (consisting of Brazil, Russia, India and China) of emerging economies to which Russia is routinely compared, and just as far behind the baseline levels Russia needs to sustain its giant population. China is posting growth at roughly four times Russia’s rate, and it doesn’t have to manage the world’s largest national territory, covering eleven time zones. Nor is it artificially buoyed by vast fossil fuel exports.
Disturbingly, the Putin economy is faltering even though the crude oil prices that form its bedrock have remained strong.
A county with such vast size as Russia, and such a puny economic base, simply can’t afford such anemic levels of growth. 1% economic growth in the USA, whose economic base is eight times larger than Russia’s despite having only twice as many workers, results in adding $160 billion to the economy, $500 for each American. That same level of growth in Russia produces just $20 billion, a mere $150 for each Russian. And Russia has such rampant corruption that the lion’s share of that $150 will simply be stolen rather than reaching the pockets of citizens in need.
As the Financial Times reports, Putin believes Russia faces a truly dire emergency and is taking risky steps which could make the situation much, much worse. Next year, he plans to implement startling price controls on gas, electricity and railroads. Putin is terrified, you see, that Russia could begin to experience the devastating phenomenon of “stagflation” in which prices rise out of control even as incomes are falling.
And he’s not wrong to be afraid.
“When this reporter met Nina Solodayeva, a former Uralasbest security guard and her husband, Ivan Solodayev, who had stage-four lung cancer, a car with the company’s security detailed pulled up to stop the conversation taking place. Solodayeva lost her job that day.”
That’s an excerpt from an article published by ace Russia reporter Anna Nemtsova in Newsweek detailing the collapse of Russia’s Stalinist monotowns. After visiting many of them, she concludes: “It is the same story in every monotown I visited. Only freedom of speech and action can provide the sort of jobs needed to replace the old smokestack industries built in Soviet times. But instead of encouraging openness and innovation, the government stands by as dissent is punished and optimism snuffed out.”
In other words, instead of opening facing the problem and trying to solve it, just as in the time of Stalin the Kremlin is seeking to sweep the problem under the carpet and destroy anyone who reports on it.
Over on the powerful and influential American Thinker website, LR publisher and founder Kim Zigfeld has more on the story of Putin’s neo-Soviet crackdown on the media, focusing on the often hilariously dishonest “reporting” by Kremlin-controlled TV concerning the Ukrainian uprising.
The Putin economy will actually post less than half the level of economic growth the IMF predicted for Russia at the beginning of the year, and it will be the lame dog of the BRIC group, bringing up the distant rear. Over on the powerful and influential American Thinker blog, LR publisher and founder Kim Zigfeld has all the horrifying details.
Over on the powerful and influential American Thinker website, LR publisher and founder Kim Zigfeld reviews Russia’s ongoing nuclear threat to the national security of the United States and the craven failure of the Obama administration to address it. America needs a new Ronald Reagan, and it has a new, poor man’s Jimmy Carter!