Doing Business in Russia. Котова К.П - 53 стр.

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      The third snare was a classic demographic trap of the “third world” in
imperial conditions. The high colonial population growth compels the “mother
country” to spend increasingly more funds on social needs, public health and
public education (and on consumption in general). These funds swallow the re-
sults of economic successes and impede economic development. However, the
alternative is impoverishment, hunger, mass refugees and civil war.
      Of course, the Soviet empire strove to prevent negative social reactions at
the “national outskirts”, that is why overpopulated regions received free eco-
nomic assistance from the Center.
      But this is where the fourth snare lies. Social assistance from the imperial
Center does not, as a rule, reach those for whom it is intended. Subsidies and
benefits enrich the local ethnic elites (the “national personnel at the nation’s
outskirts”). They send their lobbyists to the Center. The next stage is the fusion
of the corrupted Center and the local ethnic elites, who promote their emissaries
as officials to the central administrative apparat. Meanwhile, social desperation
grows at the other social pole.
      Finally, the fifth snare consists in the fact that everybody is dissatisfied –
the titular nation (“we are being ruled, and national minorities are enriched at
our expense”) – and the regional nations (“we eke out a beggarly existence un-
der the power of the majority who bribe our leaders”).
      This is not even a snare, but a whole trap that has been sprung. The only
way of getting out of it is by breaking the trap, i.e., through the dismantling of
the empire.
      Will Russia learn from others’ experience?
      It is absolutely clear today that, following the disintegration of the USSR,
the multi-ethnic Russian Federation faces similar problems, first of all, in the
Northern Caucasus, understood as an economic region within the Stavropol
Territory, the Rostov Region and national republics.