Russia's Miseries

We don't hear much about Russia these days except from those who still stew in the fantasy that Donald Trump colluded with Russia to steal the 2016 election, but these are not happy times in Russia.

Part of the reason for the Russian Bear's current unhappiness are the sanctions imposed on Russia by the Trump administration, the same administration led by the same man who was supposed to be "Putin's lap dog," the same man who was alleged by the more delirious media talking heads to be in cahoots with Russia to sell out the United States.

But there are other reasons for Russia's distress, too. Strategy Page elaborates:

The Russian economy has taken a beating because of low oil prices and Western economic sanctions imposed after Russia invaded Ukraine in 2014. The Russian advance in Ukraine has been stalled since 2015, after Crimea and parts of eastern Ukraine had been seized.

The stalemate in Ukraine has crippled the Russian military since Ukrainian industry was a key supplier of military components.

Russia estimates that the loss of access to Western technology and Ukrainian components cost their military over $25 billion so far. That was the cost of replacing or doing without new components that used Western or Ukrainian tech. Locally made replacements were usually not as effective as what the Ukrainians were providing until 2014....

The most severe shortages occur in key areas. Prominent examples include IBCMs, air-to-air missiles, aviation and engines for warships.

Then there are the Ukrainian made guidance systems used in Russian air-to-air missiles. This includes the infrared (heat seeking) guidance systems for short-range R-73 and medium-range R-27T. These missiles are the main armament for MiG-29, Su-27, Su-30 and Su-35 fighters.

But their military woes are only part of Russia's miseries:

By 2017 Russia was also facing problems with population decline, corruption, an increasingly inefficient police state and an exodus of its best educated and most entrepreneurial citizens. Russia was no longer a great power and, as much as Russians would talk about regaining their superpower economic status, that is not going to happen.

To put it into perspective, consider how smaller (especially in terms of population) countries like Australia managed to pass Russia in GDP. Russia still has six times as many people as Australia but Australia has far less corruption and a much more efficient government and economy. The Australian population is growing and its GDP in 2016 was the same as that of Russia at $1.3 trillion. The Australian GDP was growing at least twice as fast Russia’s.

International economists at the World Bank and IMF (International Monetary Fund) see Russian GDP continuing to fall as long as low oil prices and sanctions remain as they are. In 2013 Russian GDP per capita (person) was $16,000 compared to $7,000 for China. By 2020 both nations will have about the same GDP per capita of about $12,000. These trends are expected to continue for the next few years and Chinese GDP per capita will continue to grow faster than Russia’s.

The Russian people, especially the poor, have suffered awfully for centuries, the worst of which was the twentieth during which century the people groaned under the boot of a draconian totalitarian socialism. Although there's much more private ownership in Russia today freedom is still limited, which is why many of the "best educated and most entrepreneurial citizens" who can go elsewhere to make a life, do it.

It's a shame because the Russian people are often brilliant, their literary output alone is magnificent, and the country is richly endowed with resources. So why can't they manage to achieve something more than a third world economy?

Perhaps part of the reason is that under the old Soviet system so many of the best and the brightest were liquidated and those who survived developed a kind of slave mentality which inhibits economic progress and which may take many generations to overcome.