Doing Business in Russia. Котова К.П - 20 стр.

                                        20

tem. However, it is obvious that the action of the new Prime Minister will nei-
ther stabilize the economy, nor advance radical reforms. Still worse, it will
sharply lower our standard of living and aggravate all social problems. What’s
more, if the compensation policy suggested by the Cabinet of Ministers is car-
ried out, the situation will worsen even more.
      It is noteworthy that in 73 years of the people’s state only recently did we
get an official calculation as to what is a subsistence wage. Although logically it
ought to be the basis of our social policy.
      We still don’t have the officially approved amount of subsistence wage in
the USSR. The results achieved by the above institutions are contradictory. The
minimum per capita budget (in reference to 1988), worked out by the committee
for Labour, was 105 roubles per month and by the Committee for Statistics – 75
roubles. It took several months and an increment of 3 roubles to coordinate posi-
tions. The final subsistence wage, signed by both committees, amounted to 78
roubles a month.
      Of course, the main reason for disputes lay not in methodological ap-
proaches. Two facts produced a shocking impression. First, it appears that over
90 million people or nearly 32 per cent of the country’s population have a per
capita income of about 105 roubles a month and, consequently, are living below
the official poverty level. Second, these 90 million could have demanded (le-
gitimately) a rise in their incomes that would bring their incomes up to the sub-
sistence wage.
      The absence of concrete ways to measure people’s living standards and
their dynamics veiled the most serious tendencies in the social sphere: the be-
ginning of a relative and absolute impoverishment of the population, the disinte-
gration of the consumer market, increasing redistribution relations based not on
labour input, but on the distorted “market Soviet-style” principles, labour crisis
and complete destruction of motivation mechanisms and inefficiency of the so-