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Putin as a rescuer

Putinomics: Power and Money in Resurgent Russia
Chris Miller has written an interesting book on the economic development of Russia under Putin. If one allows to sketch roughly, one can say that ordinary Norwegian media coverage of Russia is characterized by a stereotypical way of thinking.

"Russia is another place," as a well-known Norwegian author and journalist wrote. Norwegians have become accustomed to being eaten up by shorter elements in news broadcasts or in newspapers, where deficiencies in democracy development are pointed out, or as in recent times, where we get a dull reproculture on a theme from the Cold War era: Russia as a possible military threat to Norway. Apart from this, the deeper analyzes and the long lines have often been lacking. The tendency to Russia is another place, has also been dominant in book form. Norwegian books have been written that state that it was too optimistic to expect a normal democratic development in such a country, with such a history. In other fields, otherness in relation to the West is also emphasized. Common to these types of books is that they build their arguments with examples from history, while little is taken in from the present. Chris Miller stands out here completely. His book is a sobering treatment of recent Russian history, which, based on facts and statistics, says something about the kind of economic development that has taken place in recent years. It is a positive image he broadly and it all brings to the square. And we can add to the word fierce, when we talk about Russian economic development. Russia has experienced tremendous economic development over the years with Putin as president. At the end of the book, you are also left with a feeling that the American historian and economist are giving Putin Russia a solid passed, as a testament to the work they have done in modernizing the economy. As a Norwegian reader, one can get a paradoxical feeling: The "Cold War" thinking of Russia as Europe's strange extremes, where democracy and the economy are on the wild, will, with Miller's perspective, turn completely to its opposite, at least a good deal on the way.

At the end of the book, you are also left with a feeling that the American historian and economist are giving Putin Russia a solid passed, as a testament to the work they have done in modernizing the economy.

Putinomics. Miller begins his story in the year when Boris Yeltsin was about to hand the levers to the then unknown Vladimir Putin. 1999 was really the last year for the Soviet economy, Miller argues. Yeltsin had taken over a Soviet state with fundamental structural problems – the state was largely maintained and financed with loans from abroad, throughout the XNUMXs. Although the oligarchs had been greedily supplied by the oil sector, as well as from the revenue-generating mining industry, Russia was characterized by a plan economy. This industry and these jobs were sustained by skyrocketing loans from foreign states and investors. The Russian state was in deep crisis: Foreign states and banks were closing the cranes.

Miller then spends a lot of space pointing out what decisive steps Putin and his men put in place. He calls this Putinomics.

The first thing Putin did was to introduce a tax regime – taxes had not been paid under the Soviet economy. Yeltsin's attempt to do so had been sabotaged by the population. A flat tax was set at a modest 13 percent by Putin's first government. They succeeded in the collection. In addition, exports of oil and gas were taxed per unit sold: 27 percent tax on oil sold was earned directly to the state. The result of this reform was that large sums of money began to flow into the central power. Putin's regime chose to pay down debt from Yeltsin's first reign. This increased the country's confidence in the Russian economy, and it again became easier for business to borrow money from abroad. In addition, the Russian state built up a huge oil fund, with money to come in handy at the next crossroads. Russia got back on its feet during the years 1999-2008.

Economy on rails. At the end of the period, Putin was the leader of a country of continuous growth of four to five percent each year. The large government debt was repaid, the industries outside the oil industry were starting to build up and gradually got good results. The steel industry had been modernized and Russia had become the world's fifth largest steel exporter. Producing enough food was a continuous challenge in the Soviet Union, but with a new and professional trade in goods, the problems were largely solved – either by import or by improvements in production. At the end of the period, Russian metropolitan areas – like other western cities – were characterized by newly built shopping centers, where food and other necessary goods could be easily traded. In addition, the author can point out that labor, energy and raw materials were cheap in Russia, which gave the country an advantage. Foreign investors began to move the automotive and other industries into certain regions of the country. Emphasis was placed on keeping inflation low in the Russian economy, at the same time as wages and pensions were adjusted up to the price level. Everything went off. Putin was clear that the development of a normal market economy required a strong state. Towards the end of the period, Putin's regime began to increasingly break into economic conditions as they saw their interests threatened by foreign, or the intersecting interests of others. As a result, foreign investment willingness was dramatically reduced. In addition, there were two major falls in the oil price: one in 2008, one in 2014. The foreign policy adventures of the Putin regime also contributed negatively.

According to Miller, there has always been a kind of informal social contract between the governing powers and the people of Russia: It is crucial that the working class also benefits from social development. This balance has sometimes been challenged by Putin himself, as during his years in power he has built up an elite around himself, although he would settle the oligarchy when he took office.

Still, the author is almost reluctant to release Putin's rule from the charges of being a despot who has taken over the people's property. Chris Miller seems to fall into the fact that Putin is a complex human being, who has probably been driven by disinterested motives for periods of time.

Russia as another place. Miller's book can set a Norwegian stereotypical view of Russia as the other under heavy pressure. Towards the end of Miller's book, it is easy to raise some questions: Does Russia really act as a kind of negative, all-black contrast example in economic terms, when compared with Norway? Are things moving more, and rather about being the opposite, over the years gone by? Even now we are in a country that increasingly resembles a kind Eve countries, with a declining industry, concentration on the fateful oil industry, and bastened and bound by agreements with the EU and NATO. So there are several things in operation here: On the other side of the border lies this vast country which now serves to a lesser degree as a negative contrast to Norway in economic terms.

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