The countdown to the economic collapse has begun: why Russia will not be able to pay even state employees
To all appearances, Russia is heading into an economic abyss at an extraordinary pace, which will certainly affect the wallets of every one of its inhabitants. To avoid the deterioration of life associated with sanctions and the failure of the state to provide for itself, the representatives of the Putin government will not be able to succeed.
The Russian economy, built on a sham for decades thanks to high oil and gas prices, has been gradually rotting since 2008. Putin and his team have done nothing since coming to power to bolster growth and diversify the flow of funds to their own budget. Why the countdown of the economic collapse of Russia has already begun, we tell in the material of Channel 24.
Instead of developing and creating competitive enterprises and changing the very concept of Russia's existence in the economic space of the world, the Kremlin leaders settled on preserving the version of the gas station country and strengthening the dictatorship with all its consequences.
Wars are more important than development
Taking advantage of rising oil and gas prices in the early 2000s, Putin focused only on associating his population with economic stability. It was thanks to this propaganda that it was easy to instill in Russians another chauvinistic fable about the “great people”, to increase hatred towards national minorities and residents of neighboring countries, and also to constantly create external and internal enemies, allegedly “threatening the existence of Russia.”
In fact, the Kremlin, without creating any economic miracle, has taken the path of constantly slipping a “small and victorious war” into the population at a time when Putin's ratings were beginning to fall. In addition, various Russian political lobbies in Europe and the US allowed Moscow to blackmail the world and manipulate energy prices, constantly keeping its economy afloat.
However, after the crisis in 2008, when the price tags for Brent and Urals began to plummet, it became obvious that the economic model created by the Kremlin is absolutely dependent on the situation on the energy market, and there is simply nothing to replace Russia's petrodollars with. From that moment it was clear that even without wars and sanctions, Moscow would literally collapse at the moment when the world switched to alternative energy. However, the dictator and his entourage were not up to the realization of these facts. They dreamed of the revival of the USSR and geopolitical dominance, despite the fact that to reproduce such a concept, technology and state access to the full production cycle of anything are needed.
It is clear that the bunker Fuhrer and his entourage lived in a bubble, ignoring the need for real import substitution of goods and the creation of a viable economic system. And as soon as Russia became cut off from European markets, its financial system immediately went to the bottom.
Already in mid-2022, when it became clear that a full-scale war against Ukraine was dragging on, the Russian government was sounding the alarm about how much money Putin’s next adventure was costing the state. However, the very first really painful sanctions associated with the refusal of civilized countries to buy Moscow's oil led to the formation of a huge hole in the budget. Which is literally nothing to cover. Therefore, the Russians began to rapidly approach the moment when the consequences of the policy of “war over development” will be felt for everyone.
The countdown has already begun
Of course, a certain “financial cushion” and well-thought-out steps of specialists gave the inhabitants of the swamps the opportunity to delay the blow to their wallets. However, the slowdown in the deterioration of life due to the collapse of the economy was unstoppable, and every day of the existence of Russia in a market economic model will lead to a greater collapse in the future. Already, by the way, quite visible.
The first serious problems with the payment of wages affected the oil and gas sector at the end of 2022, when employees of a number of enterprises suddenly did not receive money for their work. However, official Moscow rejected the need to stop the war and stop spending crazy money to support hostilities, and began to intensively eat away the reserve fund. And when budget revenues fell to record levels in January, the countdown began to the final drowning of Russia as an economic unit in the world. In the first month of 2023, the Kremlin decided to make large upfront payments to defense industry enterprises, leading to wild cost overruns. Together with the fall in budget revenues at all levels, this led to a certain panic among everyone who understands at least a little about macroeconomic indicators. However, in February, the government also had to throw in money to finance the war, while the situation with income did not improve in any way. And this time, Putin's flock has already got into the pockets of the Russians.
So, in the outback, they simply did not pay the salaries of many teachers. Only according to official data, as of March 1, the state owed state employees 152 million rubles in payments. It would seem that the amount is not so large, but in January this figure was only 10 million. That is, the growth took place exponentially, and it is not at all difficult to predict what will happen in the coming months. Non-payment of salaries to teachers and doctors in Russia will become the norm. Further, this trend will reach the employees of many state-owned enterprises, and then to pensioners.
For the Bunker Fuhrer, all teachers, doctors and elderly people are a burden that prevents him from financing the war. And in fact, the only sector that Putin will finance until the end of his regime is the security forces and the army. After all, the termination of the allocation of funds for the war and punitive detachments will be equal to the death of the regime. However, ordinary Russians now need to prepare for the fact that the state will leave them penniless. But with fictitious social guarantees, about which the tsar will tell the plebs from the TV screens.
Forget about compensation.
It is clear that in the current economic situation, the bunker Fuhrer will never admit that the compensation program for the relatives of the dead will be curtailed. However, cancellation of payments is absolutely inevitable. Even now, thanks to various schemes, almost the majority of the families of the liquidated occupiers cannot receive a penny from the state. And if the Kremlin does not dare to admit that they are abandoning the system of compensation, they will have to completely release the exchange rate and print tens of trillions of rubles to pay.
Meanwhile , Russia's oil and gas revenues have almost halved in 2023 – and that's just according to official figures. More – read on.
In this case, the widows of the invaders will not be able to buy new frets, and at best they will exchange the life of their husband for a loaf of bread. Moreover, with insane inflation, Putin will have to index the salaries of senior officials, as well as policemen, who, in which case, will be entrusted with the responsible mission of shooting participants in hunger riots.
However, this does not mean at all that Russia will not be able to continue the war. The slave population, fully motivated to kill Ukrainians, will probably consider it lucky to join the army simply because of the presence of at least some kind of food supply for the soldiers.