Thursday, July 03, 2014

Why have Russians gone so crazy

Why has a large part of Russia lost its mind? Essentially it is a population allowing Putin to restore the failed Soviet system, but there are some key collapses taking place long term making the Russia people extremely anxious. First and foremost is extinction.

 Russia has always depended on its massive reserves of human capital to ground its power. In World War II the US had the material means to fight but Russia had the human capital. Well today it is very different, the United States is a vastly more populated nation than is Russia.  We are talking 2 to 1.

If America was in a conventional war with Russia it could, in theory, afford to lose way more men.  But its not just the population loss, its relative to other big nations which are overtaking it.  In the past 50 years Indonesia, Brazil and now Nigeria have more population than Russia, and Mexico is on the verge of overtaking Russia.

 As hard as it is to believe the economic news is even worse. At the end of World War II the USSR
 was the second largest economy in the world.  Today is is smaller than Brazil and only a bit larger than Australia, though given recent Australian economic growth is likely has been overtaken by a big island that is mostly desert.

 

Now lets look at the big hitters. Remember after World War II the USSR was second to only the US, well today the Russia Economy is less than Spain and Canada, Nations like Japan, US, and China have left it in the dust, and the growth in the US economy, which has been amazing since the end of World War II along with China has buried Russia.

 

Russia has had some impressive GDP growth from 2000 to 2007, but these have been dwarfed by the huge impact of crisis.  Russia's economy has utterly collapse 3 times in 30 years, with the collapse of the Soviet Union, with the Currency crisis of the late 1990s and with the 2008 collapse.  Current signs show the economy is going down.



Most of this happened at a time when many global investors were keen to invest in Russia and the global community felt a need to stand by Russia.  Russia was time and time forgiven serious issues of corruption, violations of human rights and Chechnya.

But for some reason Putin seems determined to collapse international relations, and Russia is current experiencing a capital flight and new economic downturn.  Also the US is experiencing a massive energy boom.

The long term picture: unless some strong reformer comes in and either takes out Putin, or Putin dies soon and someone who can turn it around comes in Russia and the Russian people are facing another one of their long dark ages.  Hungry cold and disease mixed with drinking, violence and racial hatred are the present and will remain the future for many generations to come.

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