Manipulating the data, going back to the Soviet-era five-year plans, or even the Soviet Union itself? The dilemma for Russia has been suggested since the last video conference, where Vladimir Putin admitted that “2022 was a very difficult year” for Russia, he assured that “according to the Ministry of Economic Development, Russia’s GDP grew by only 2.1 percent dropped between January and November, when even among our economists, let alone those abroad, a drop of 10, 15, or even 20 percent was expected. However, a minus of 2.5% is expected for the whole of 2022.”
But according to the latest independent analysis from the World Bank, International Monetary Fund and OECD, GDP in 2022 would have fallen by at least 3.4 percent in the best-case scenario and up to 4.5 percent in the worst-case scenario. According to the same forecasts, the Russian economy will continue to contract in 2023. GDP is expected to shrink by 2.3 percent in the best-case scenario and by 5.6 percent in the worst-case scenario compared to the previous year. When it comes to inflation, Putin speaks of 11.9; international organizations by fourteen percent.
Putin also assures that “the current dynamics are better than many experts had predicted”, but adds that “the technological and infrastructural risks have not yet been resolved”. To solve them, and more generally to deal with the difficulties of war, someone from the Russian Academy of Sciences is proposing a return to Soviet-style planned economy.
Such a proposal comes, for example, from Ruslan Grinberg, director of the Economic Institute of the Russian Academy of Sciences. “Russia needs to get back to planning,” he said in a Dec. 29 interview with state-run RIA Novosti to commemorate the centenary of the founding of the Soviet Union. “Just daubing the USSR with black paint does not mean understanding the essence of things. There was a lot of good in the Soviet system. Even critics have recognized this. We’ll never be able to quantify how much the Soviet model affected the whole world, but the impact is quite significant. Government regulation, social security, free health care, free education – all of these have become part of life in many countries.
Grinberg pointed out that his proposal went beyond the requirements of a war economy, even if he didn’t want to return entirely to the Soviet system. He explains that his idea of a planned economy “is not trend-setting, but indicative. The fact is that the state needs to start formulating economic priorities. And then it must not force industry to produce a certain amount of goods at a certain point in time, but stimulate production through subsidies and tax and tariff policies».
But obviously someone immediately thinks of going further once the taboo has been cleared by customs. The director of the same academy’s Central Institute of Mathematics, Albert Bakhtizin, has proposed “changing the liberal economic model” by going straight back to the five-year plans. “A kind of strategic planning with a clear definition of goals and a key figure system that specifically calculates what is to be produced when and what is necessary for this”. Which, of course, would bring the mathematicians of his institute back into focus.
Political scientist and philosophy professor at the University of the Basque Country in Vitoria-Gasteiz, Michael Marder, dedicated an analysis for Project Syndicate to these proposals, noting that “Grinberg’s and Bakhtizin’s proposals may appear signs of despair in the face of international boycotts and subsequent economic sanctions packages.” . But that’s only part of the story. The other part is the total ideological, political and economic reversal of the reforms initiated by Mikhail Gorbachev before the collapse of the Soviet Union and continued in a different style in Yeltsin’s Russia in the 1990s».
In his analysis, the Russian invasion of Ukraine on February 24, 2022 marks an “implosion of history” that turned the chronological order of time upside down and in which different timelines converged: “The line of the Soviet collapse thirty years ago; the Chernobyl disaster 36 years ago, which hints at an indefinite future for pollution; that of the two world wars; that of the Ukrainian genocide and Stalinist repressions of the 1930s». As in the mirror of “Alice in Wonderland”, one enters an alternative reality, which is reflected in the language, whereby “in Putin’s verbiage a war is not a war but a special military operation, although it itself is now allowed to use the forbidden word. Or, as the last joke in Russia says, the Russian army is not retreating, but is making “negative counter-attacks”».
The invasion of Ukraine coincided with a return to Stalinist-style internal repression. “All of which brings us to the current proposals for restoring a centrally planned economy. Although introduced at the beginning of the Stalinist era (ie, before the purges), the original Five-Year Plans represented a transitional phase of Lenin’s New Economic Policy, which left some scope for independent initiative and freedom to peasants and small private enterprises. In other words, we see through the mirror of the Ukrainian war that Soviet history is not repeating itself, but is being rewound and reproduced at full speed in Russia itself. The logical outcome of the assumption of a planned economy is precisely what led to the great breach between Lenin’s NEP and Stalin’s five-year plans, ie massive expropriation’.
Marder therefore predicts that “after the bloody collectivization processes that took place in the Soviet Union between 1929 and 1933, after the “shock therapy” of privatizations of the early 1990s that produced the Russian oligarchy, a new wave of violence is now unfolding in the redistribution of property in Russia”. At the moment, the violence is directed abroad, with the destruction of power plants, civilian infrastructure and thousands of innocent lives in Ukraine (Russia’s parliament, the Duma, has just passed a law granting Russian soldiers immunity for crimes committed in Ukraine and stolen property legalized and property as deeds of gift of the population of Ukraine).
But given the speed of reversal of historical repetition in Russia, Marder concludes, “it won’t be long before violent appropriations occur at home. If we read between the lines of the messages of economists and mathematicians like Grinberg and Bakhtizin, we can glimpse the old ghosts of dispossession. And maybe even bend over the abyss of a real civil war.