Asked about the price of sanctions for the Russian population, Guriev replied that the quality of life would drop by 10% to 20%. There will be no growth. And the “creative class, the educated people will realize that there is no future in this country. They will emigrate”. In democratic countries, if living standards fell by 10%, there would be big demonstrations and the government would likely resign, said the economist. This is not the case in Russia, but “everyone is unhappy. The elite is unhappy that their businesses have been destroyed.” Only a few benefit from the production of military goods, but on average the situation is “bad”.
Will sanctions be able to end the war? Guriev was skeptical that there was a chance of a peace treaty between Moscow and Kyiv. An acceptable peace treaty for Ukraine would include the return of occupied Ukrainian lands, the payment of reparations by Russia and the handing over of all war criminals to international courts. But this is unacceptable for Putin. “In that sense, this war will continue as long as Mr Putin is in the Kremlin.” Only if Ukraine got enough weapons to win this war would Putin’s popularity suffer so much that he would not be able to stay in the Kremlin.
Guriev can also imagine that the war will turn into a frozen conflict. Guriev referred to North and South Korea, where there is still no peace treaty, but there is no hot war either. “In this scenario, Russia becomes North Korea, remains under sanctions and Ukraine starts reconstruction.”