Saturday, August 14, 2021

Russia’s Middle Class Disappearing Because Kremlin Finds It Easier to Control Those with Lower Incomes who Depend on It, Experts Say

Paul Goble

            Staunton, August 9 – Vladimir Putin likes to claim that “almost 70 percent” of Russians are middle class, but he uses only one criterion, income, and that does not capture what a genuine middle class is. Using a broader definition including having a cushion of savings and a more independent stand in the economy, only about 10 percent of Russians are middle class.

            Worse, commentator Sergey Medvedev and economists Yevgeny Gontmakher and Boris Grozovsky say, that share has been declining not just because of the impact of the pandemic and economic crisis but as a result of the conscious policy of the Putin regime which is certain that it is easier to control people who are not middle class (

            And as a result of this combination of factors, Russia is a country with a unique and potentially dangerous class structure: one percent is super-rich, ten percent are middle class by any reasonable definition, 25 to 30 percent are really poot, and nearly 60 percent are those who are not really poor but who are best described as being the class below the middle class.

            According to Gontmakher, “’the class below the middle class’” is where the fate of Russia is going to be decided. It includes those who work for the government and government-linked firms, the employees of some small and mid-sized businesses and people in the free professions.

            There are two possible trajectories for this class below the middle class, he continues. Given normal economic growth and a minimum of political interference, it will serve as a reservoir for the growth of the middle class. But if growth is slow or nonexistent or the regime interferes, then it will see its members drop into the truly poor.

            Medvedev adds that in his view, the Putin regime doesn’t need a middle class. It wants a state and a people who serve the state. As a result, it is more appropriate to speak of state-defined “strata” than of classes in the usual sense. Gontmakher says that he agrees with that analysis to a large degree.

            But to the extent that Russians in the class below the middle class fear falling into the genuinely poor, that constitutes a problem for the regime, Medvedev continues. On the one hand, they will demand that the regime at least take steps to prevent that. And on the other, they will as they are doing now leave the country to the extent they are able.

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