FREE ESSAY ON RUSSIA

RUSSIA

Tristan Yapuncich
Period 3 4/20/00
Position Paper Russia
Position Paper: The Plan
The main problem in Russia is lack of a non-corrupt government. It is impossible to run
any country, poor or rich, crime or no crime, healthcare or no healthcare, economy or no
economy, without some sort of government. Russia needs assistance in the form of
socialist diplomatic support, advice, and very carefully monitored loans. There is no
question of producing a Marshall Plan for Russia of the sort that the United States
pioneered after World War II, but Russia needs to make that plan, and the U.S. needs to
let Russia know that plan will be supported. Although the conditions in Russia differ
significantly from the post-war Europe, this struggling nation needs a similar plan to
restore it's economy, government, and human rights. Russia is in a desperate state of
despair, suffering from poverty, crime, and disease, and needs aid from the U.S. It is
also in the interest of the U.S. to provide this aid, as long as the aid is targeted at
areas that would best boost Russia's terrible statistics, and turn Russia into a
successful trading partner.
Poverty is a huge problem facing Russia. In a country with such long traditions of
statistical manipulation and hostility to the inquiries of the state, it is not easy to
pin down the true extent of poverty in Russia. But there is little doubt that the picture
is looking increasingly bleak. United Nations figures suggest that the purchasing power
of average income in the USSR in 1987 was about $6,000 or 32 per cent of the level of the
US (Andrew, POVERTY: Bleak future for the poor). By 1996, it was just $4,531 in adjusted
terms, or 17 per cent of the US level (Andrew, POVERTY: Bleak future for the poor). Since
the collapse of the Soviet Union, there has been both growing inequality and a jump in
absolute poverty. That is up from 11 per cent in 1994 (Andrew, POVERTY: Bleak future for
the poor). Faced with such bleak figures, some observers argue that the figures are
simply false. There is little doubt that data collection is plagued with difficulties,
and there are fierce debates about methodology. There are problems that exaggerate, and
others which artificially underplay, the true state of Russia's population. But as
Tatiana Khokhlova of the Russian European Centre for Economic Policy in Moscow argues: It
is very difficult to talk about the absolute level of poverty, but you can analyse the
trends. And those trends are distinctly pessimistic. 
Government figures often show what citizens are entitled to receive rather than what they
do receive. In 1997, just 20 per cent of income that Russians were entitled to under
federal laws was actually paid (Andrew, POVERTY: Bleak future for the poor). Since then,
arrears on the payment of wages and social benefits have increased sharply. Pensions are
on average paid with a delay of one month at present, and wages are 2.5 months behind
(Andrew, POVERTY: Bleak future for the poor). Equally, there is little doubt that
Russians conceal the true extent of their income from official surveys as part of a
broader strategy of tax avoidance. A recent World Bank study found that most people
admitted to spending twice what they claimed to earn. Other research suggested that
undeclared informal income had rocketed in the past few years to an average of 42 per
cent of total household earnings (Andrew, POVERTY: Bleak future for the poor). 
If poverty is a problem, naturally health care, crime, and other issues become concerns.
Russia has a declining life expectancy, increasing birth mortality, and increasing crime
rate. Russia's population is likely to dip under 146 million by the year 2000 and drop to
141 million by 2010, according to a new government forecast. The report by the State
Statistics Committee also projects that Russia's dismally low life expectancy figures
won't rise in the decade ahead, Interfax news agency said. Based on the most likely of
four demographic estimates compiled by the committee, the average life span in 2005 will
be 65 years -- the same as in 1996 (Andrew, POVERTY: Bleak future for the poor). 
Russia's population, which has been in decline since the Soviet Union's collapse, shrank
by 4,75,000 people last year and currently stands at 147.1 million (Andrew, POVERTY:
Bleak future for the poor). Demographers blame the soaring mortality rate and low birth
rate on a protracted economic crisis, severe stress over the transformation to a market
economy and a sharp deterioration in health care. Among other forecasts, the Statistics
Committee also said that the female population will exceed the male population by 10
million to 11 million in 2010, up from the current 9.1 million (Andrew, POVERTY: Bleak
future for the poor).
The main cause of these problems is Russia's lack of government. They main power
controlling Russia is plutocrats that have taken over the economy and used profits for
their individual benefit. They now control most everything with bribery, and force. The
people also support these plutocrats, because they are the ones providing for the people,
as the government doesn't have funds to even pay government employees. Average yearly
health care per capita is about 20 dollars a year (Andrew, POVERTY: Bleak future for the
poor). Russia needs a government to reform its economy and start programs that focus on
the needy, health care, and the environment.
Russia has neither a productive market system nor a tradition of democratic politics.
Western Europe had both. The Marshall Plan was a government-to-government aid program,
but because of Russia's lack of a productive market system and governmental capital, aid
needs to be directed in the form of governmental support toward Russian socialist reform.
This aid should be given, not with resource transfers, but by providing diplomatic
support, advice, and very carefully monitored loans. With a stronger government Russia
could then start to pay its military, arrest plutocrats, collect taxes, and restore order
with force. The plutocrats steal, bribe, and evade taxes because they can, and will
continue to unless they are punished, or afraid they will be punished. Bribery and
corruption will only stop when it is risky to commit. Morality can not be bought, but it
can be instilled with fear. After plutocrats are arrested, and corrupt officials stop
supporting them, the oligarchy of Russia will fall. Only then, after the Russian
government repossesses its businesses and assets from the plutocrats, the economy begin
to rise.
No one will invest now because the plutocrats would just take the investments for
personal profit. When Russia returns to a government owned and controlled economy, the
U.S. should remove as many tariff and non-tariff barriers as possible, offer the former
Soviets a trade treaty, and push the Europeans to do the same. This will facilitate the
trade and export of products in which Russia has a comparative advantage, such as mineral
and energy sources. And if for reasons of patrimony they do not want to sell assets, then
they should enter into long-term leases to get Western management and technology.
The other options for Russia have very obvious problems. If the west simply gives money
to Russia, then it will surely disappear into the hands of the plutocrats. We gave, for
example, $44 billion in aid to the former Soviet Union, about which Ed Hewitt of the
National Security Council said, No one quite knows where it all went (Wolosky 20). Aid
programs, such as The U.S. Food Assistance Package for Russia, and Russian Relief, are
great, but keep in mind they don't fix anything permanently. Providing services and
programs like these help stop suffering, but will not fix the government, economy, or do
any major long term good. The programs may solve problems for the people, but not for the
country. This type of aid should be provided, but must not be a main focus of the U.S.
Russia needs to be strong enough to support these programs, and when it is providing for
the people, the people will support the government. 
Although capitalistic democracy has proved to be more successful in the past, a socialist
government owned system might be recommended for Russia. This type of economy would help
stop the Russian plutocrats who currently run the economy. After Russia has a strong
government, it can create its own social programs for the needy. Maybe after Russia
restructures itself and obtains a strong government, then it can begin to slowly strife
for capitalism and democracy, but for now Russia has larger problems and should follow
Cuba's model of socialism.
Bibliography
Jack, Andrew, POVERTY: Bleak future for the poor, http://www.ft.com/ftsurveys/sc3ee6.htm,
Internet, 4/28/00
Lynch, Allen, Great Decisions, Report Card on Survival, New York, The Chase Manhattan
Corporation, 1999
Powell, David E., The Dismal State of Health Care in Russia, 1999
Wolosky, Lee S., Putin's Plutocrat Problem, 1999