Thursday, June 26, 2014

The trouble with Russia . . .

. . . is that it's full of Russians.

Further evidence comes in this story from Bloomberg News, which recounts the slide into the economic abyss under Vladimir Putin, whose 15-year reign at the top of the heap puts him within striking distance, as for as longevity goes, with those other misgoverners of Russia, Nicholas II and Joe Stalin.

Putin, however, does not have the excuse of having to deal with a devastating invasion by Germans.

The Bloomberg look centers on finances and ignores agriculture, which has been the fundamental problem for the Russian economy since forever, and certainly since Nicholas ascended his throne. It was the failure of agriculture not the rumblings of Reagan that brought down communism. The attempt by the United States to turn Russia toward capitalism by, for example, modernizing its stock market, was a complete failure. The US did make some ineffectual efforts to advise the Russians on improving their farming -- that's a sector where US advice was more likely to be worthwhile than financial markets, where no one would have been well-advised to follow the lead of the Reaganites.

It is not clear to me whether the Russians rejected the American advice on farming or just ignored it in favor of mining gold and oil.

It is obvious what first steps Russia needed to take to get its agriculture on a paying basis -- provide all-weather farm-to-market roads. This would have multiplied the efficiency of farms, which continue to lose much of their output after the harvest; would have stimulated the general economy, New Deal style; would have added to the national infrastructure assets; would have provided an outlet for the economic aspirations of the non-Russian minorities; and would not have been threatening to other nations.

In short, it would have pushed Russia in the opposite direction from the one it actually took.

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