Russia: 1% of parasites owns 90% of assets

2024 Author: Seth Attwood | [email protected]. Last modified: 2023-12-16 15:55

Commentary by Konstantin Babkin on the topic “Poverty and Inequality: Recipes for Cure” of the Moscow Economic Forum (MEF).

- As you know, our tax system is built in such a way that the rich pay less than the poor, even as a percentage of their income. Such a tax scale only increases the stratification, and this was done deliberately - this is part of the policy of the modern government. And in the course of privatization, the next stage of which is now being discussed, it is obvious that the poor will not get either a part of Sberbank or Rosneft, and the privatized companies will either go to foreign bankers, or they will go into the ownership of oligarchs who have free funds to buy.

And, as you know, our main oligarchs are people who have not made any inventions, discoveries, these are people, just appointed from abovein the process of privatization. Chubais, the ideologue of privatization, believed that this was not an economic task, but a political one - it was necessary to create a new elite. And it is no coincidence that his friends and associates became the main oligarchs. That is, the problem of stratification has, among other things, a political origin and was largely created deliberately during the formation of a new financial and economic elite.

- I will propose not to take away and divide, and not even to revise the results of privatization, because in my understanding this will generate much more problems, shocks, trust in private property will again be undermined - I do not see a recipe for a solution in this. And I see the recipe, firstly, in the construction of an economic policy that is aimed at new industrialization, at the development of non-resource sectors in industry and agriculture.

And, secondly, in the process of economic development of the non-resource sector, of the entire economy, it is necessary to create conditions for the development not of oligarchic structures, but for the development of small and medium-sized businesses, for the emergence of millions and tens of millions of new small owners.

For example, there is great potential in the field of agriculture. Our government policy - this was announced 15 years ago - is to provide priority support and create agricultural holdings. And by some estimates 18largest agricultural holdings in Russia receive more than 80%all subsidies that are allocated by the state.

At the same time, many small, medium-sized farms have never seen government support at all. Thus, competition is disrupted, the same stratification of society is growing, fields are emptying, villages are emptying, and other various painful phenomena are manifested. Therefore, the agrarian policy must be reformatted so that, first of all, subsidies are received for farms, small and medium-sized farms.

- In industry the same thing - you need not to stimulate imports, not to withdraw money from Russia, but you need to create conditions for the development of small companies in mechanical engineering, in industry in general.

Therefore, my recipe will be that you need: a)develop their own non-resource economy; b)to do this in such a way that young, talented and hardworking people can receive shares from the “pie” and participate in its increase. Not the oligarchs appointed 20 years ago.

- The approach that I will propose is also valid in European countries - there the amount of subsidy per farm is limited from above, that is, the farm, no matter how gigantic it may be, will never receive more than a certain amount per year. And small farms receive subsidies, depending on their productivity, but up to a certain size. In this way, the very millions of owners are created who themselves work, invest themselves, improve the living environment, and the countryside in Europe looks much healthier than our dying village. And, for example, 80% of Germany's GDP is done by small business companies - this is also the result of a long-term policy of the German government, which supports the creation and development of a class of medium and small owners.

I think that it is precisely in the development of agriculture and in a more equitable system of this development that one of the forms of solving not only the problem of the stratification of society, but also the diversification of the economy, is concluded, avoiding "oil addiction".

- I think that if Switzerland decides to apply this measure, it will be a mistake and then lead them to degradation, because it demotivates people to work and improve their professional skills. This amount will still allow them to have a car, dress, eat. It seems to me that if the state has money, then it is better to invest in education and support for its economy.

It is better to give people opportunities and freedom of action than just pay everyone who does not want to work, support and drive people to a standstill by giving them animal existence.

A working person should be the locomotive of the economy, there should be a progressive scale of taxation - maybe not the same as in France, where you don't want to be rich at all. But to remove taxation from the poorest - I would support this measure.

- "Platon" will cause or is already causing a slowdown in the economy, because cheap transportation is the most important part of a competitive economy. If we deliberately increase the cost of transportation within Russia, then we undermine the competitiveness of our country, therefore, naturally, this is a step in the wrong direction. And we need to revive our economy not by raising taxes, not raising lending rates, not reducing support for industry and agriculture, as the Government does, but it is necessary to act the other way around - to reduce taxes, protect the market, and increase support for economic activity. Our country has a huge potential, so this potential should not be suppressed, but just released.

- In general, our economic policy suppresses any creative activity … And this economic policy itself - it causes an increase in the stratification of society, which in turn again negatively affects the economy. An ambiguous problem, and the solution to all this tangle must be sought, first of all, in a change in economic policy. Mechanisms must be proposed that will ensure economic growth, with a parallel solution to the problem of social stratification.

In fact, we have only one difficulty - that management is carried out by the economic bloc of the government, which ideologically originated from the times of Chubais, Gaidar, from the early 90s, from privatization, from the destruction of the old system. They think in old categories, they meet every year at the Gaidar Forum. They have destroyed the old system, but have not yet created a positive new model. And the fact that these people have been in power for a quarter of a century is a long time - this is the main obstacle to economic recovery.

I am convinced that Russia has everything to start the stage of economic recovery - it has all the necessary resources, there is land that needs to be developed and used in agriculture, there is technology, a huge market, people who want to work and have traditions. There is everything - there is not enough correct economic policy.

If this obstacle goes away - and it can only go away by a decision of the President in our political system, then, I think, the main decisions can be made in a few months, maximum six months. And in six months or a year, the return and economic growth will begin.

Reference:

The head of Rostselmash, the largest enterprise for the production of agricultural machinery, Konstantin Babkin, in his time, in response to Vladimir Putin's request, showed the disadvantage of high-tech production in Russian realities, comparing the profitability of its production sites in Russia and Canada.

Vladimir Putin's question was why Rostselmash is not transferring the production of tractors from Canada to Russia.