Staunton, May 27 – “Every crisis in Russia – the Crimean, covid pandemic, and special operation – hits the middle class and poor most of all, Dmitry Mikhaylichenko says. “At the first stage of the crisis, the country’s rich and super rich suffer huge losses but then more than make up for their losses as the crisis continues.”
As a result, in recent decades, the poor have gotten relatively poorer, the middle class has been squeezed and reduced in size, and the rich have become richer regardless of the crisis one considers, the Ufa economist says (newizv.ru/comment/dmitriy-mihaylichenko/27-05-2022/chislennost-srednego-klassa-v-rossii-prodolzhit-sokraschatsya).
Because the Russian economy is all about access to power which acts as a redistributor, those with access benefit and those without lose, Mikhaylichenko continues; and that has not changed fundamentally since tsarist times, although the specific features of those at the top have changed enormously.
And that has one tragic consequence that few are focusing on, he says. “The ruling class, which is based on rent and has political leverage is a priori less interested in modernization” than the country needs it to be. And “now, under conditions of sanctions, its main mission to defend its ‘right’ to rents and resources” rather than to develop the country.
In this new reality, the Ufa economist argues, conditions have been created for reversing modernity, and with its reversal, for the elimination of the middle class which is the product of modern societies. As a result, “in Russia, that class will continue to shrink and become part of the new poor, however much official data outlets seek to hide that fact.”