Mounting Debt of Russia’s Federal Subjects Prompting Regional Officials to Focus on Their Own Problems Rather than on Moscow’s, Shiryayev Says

Paul Goble

            Staunton, Feb. 28 – At the end of 2025, 74 federal subject budgets were in the red to the tune of 1.5 trillion rubles (20 billion US dollars), while the others had surpluses of only 46 billion rubles (600 million US dollars), an indication that “the system has devoured itself” and one that is creating the basis for a serious political crisis, Vyacheslav Shiryayev says.

            The MGIMO economist says that regions in deficit are rapidly cutting back their spending, often on things that their own populations care about like schools and hospitals, and officials there aren’t getting the kickbacks from firms that have served as the basis for loyalty to Moscow in the past (nemoskva.net/2026/02/28/sistema-sozhrala-sama-sebya-ekonomist-vyacheslav-shiryaev-o-byudzhetnoj-katastrofe-v-regionah-strany/).

            As a result of this which itself reflects Kremlin decisions, leaders in the regions are increasingly focusing on their own problems rather than about what Moscow wants, a shift that could become the basis for the rise of regionalist movements if things continue for very long and that in fact reflects a mistaken Moscow policy intended to protect the center.

            After all, Shiryayev says, since the start of Putin’s war in Ukraine, “Moscow has been shifting responsibility downwards as it doesn’t want to think or know anything about the problems of the regions.” The message from the center to the regions is “make your own decisions; manage yourselves.”

            That may help the Kremlin in the short term, but in the longer one, regional leader who have been told to make their own decisions without changes in the tax system to give them more money to do so are certain to become more recalcitrant when it comes to following orders and ever more prepared to do what Moscow mistakenly asked them to do: act on their own.