[lbo-talk] Russia (was kvetching...)

James Heartfield Heartfield at blueyonder.co.uk
Wed May 9 00:51:01 PDT 2007

I think Andie has misread the statistics on Russia's investment levels and oil revenues.

First, as an aside, I guess that Andie takes pleasure from the idea that Russia has been converted from an industrial power to a platform for raw material exports because it vindicates an argument he was making, not because he wants to see the Russian people prostrated before the developed west.

In any event I do not believe that is what the figures show. I think the series of Gross Fixed Capital Formation as a percentage of GDP flattens off because GDP has grown, not because investment has fallen. I guess that if it were expressed in fixed dollars then it would show quite an increase. Also, a lot of the investment in the Yeltsin era was junk, so not really comparable.

I think the strong desire that commentators like Perry Anderson have to rubbish Russia's growth is what needs explaining. I remember that not so long ago a lot of people wanted to prove that China's growth was peripheral. (The otherwise very perceptive Michel Chossudovsky wrote analyses of the Special Economic Zones as a return to the concessionary zones.) Is this what was meant by "kvetching"?

In another post I gave the figures on oil and gas as a share of Russia's GDP, which is large, but by no means the only explanation of her success. Russia is not Saudi Arabia.

"Interesting. This supports Perry Anderson's thesis in a recent London Review of Books survey that I liked and Chris Doss hated, that Russia's current relative prosperity is relative, basically a matter of having come from a place where it had nowhere to go but up, and that Russia has become converted from an industrial power in a platform for raw material exports. In terms of capital development, Russia has been flat for a decade, with _no_ improvement over the depths of '98, although of course living standards are much improved. "

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