Analytics, Economics, Press-release, Russia

Current stabilization of the world economic is widely perceived as a crisis’ beginning of the end. After large-scaled pouring of money into US national economy the standings of American companies have stabilized.  “International financial support for the USA combined with intensifying dollar issue caused interim stabilization of American and world economy”, noted BC IGSO Director Boris Kagarlitsky. According to him corporations have received required loans and preserved their financial responsibility. Customer demand in the USA has also become more active.

Signs of economic improvements were considered by many analysts as signals of further market reviving. “However, the lack of government financial resources combined with imminent inflation speed-up caused by active government currency issue politics will inevitably lead to the end of stabilization period”, the head of IGSO's Economic Studies Center Vasily Koltashov is convinced. In his opinion, Russian authorities, after initial euphoria, started to realize that the stabilization is provisional. Hopes on fast overcoming of the crisis are fated to fail. Business and industry decline will go on, and that will affect Russian political system in whole.

Russian government reckons to survive the crisis without serious changes in a country’s socio-economic system. Current politics is still neolibral, in spite of spontaneously started adoption of protectionism. However, the crisis increasingly demonstrates government economic inefficiency along with incapacity of Russian state machine in its present shape to transform Russian economy. State superstructure voices concerns of raw material monopolies and it strictly adheres to the policy aimed at country’s peripheral development.  Bureaucracy’s omnipotence gives birth to all-round corruption. Unitarian type of Russian state machine and lack of sufficient liberties prevent free discussion on crisis management. Undemocratic style of administration deprives opportunities of legal political change.

Reorientation of economic politics from increase in export to domestic market development remains impossible not only because of institutional barriers. “Russian citizens’ social passivity is crucial. The government counts on it and considers it as a constant. However, lead-time of a crisis, which follows in spite of lavish promises of its forthcoming ending, will inevitably cause the changes in public consciousness”, Anna Ochkina, head of IGSO's Center for Social Analysis, supposes. She assess the crisis has already given the birth to the mass disillusionment in the future. People have expected further improvements of lifestyle as a result of economic growth before the decline. A lot of them go though depression now, which will turn out to be large-scaled reappraisal of values. Reviving of a social life is unavoidable. It will urge large-scaled changes in Russia on.

IGSO is an independent intellectual center. Its activities are directed to generate expert judgments, conduct researches and contribute initiatives aimed at democratic and radical socio-economic transformation of society. Its predecessor was IPROG headed by Boris Kagarlitsky. In 2006 the majority of IPROG’s team has set up a new institute – the IGSO.