25 may at a meeting of the Economic Council Presidium will host an event that can be called “the battle of anti-crisis strategies”. Proponents of the two approaches will convince Vladimir Putin to the effectiveness of the proposed measures. In the camp of supporters of the concept of fiscal stimulus, presidential aide Andrei Belousov and the representative of the Stolypin club, the business Ombudsman Boris Titov. They believe that the Russian economy can grow at 4% GDP per year starting in 2018, In financial terms, this means revenues to the Treasury additional 300 billion rubles., which are necessary for economic modernization and its structural adjustment.
As resources for the implementation of gosvlivanij stimulating the developers of the model indicate that retained earnings of companies. A tool may be to increase the limits for project Finance (refinancing of banks at a low rate for the implementation of specific business projects). In fact, it is a known economic model of recent years, characterised by the growth of social spending in a period of high oil prices.
As an ideological antagonist easing fiscal policy, Chairperson of the Centre for strategic research Alexei Kudrin, who called for fiscal consolidation. “It is not necessary to drive the country to economic growth in the coming years, there are no resources for this. The maximum you can get a stable GDP growth of 1%. It is important to reduce the deficit to 1% of GDP, and inflation to 4%, and in the meantime to carry out institutional reforms — judiciary and law enforcement” — said the former Minister of Finance. Proponents of this approach believe that fiscal stimulus will lead to higher taxes, though it is not obvious.
Noteworthy that “Kudrin’s plan” involves targeting inflation and reducing the budget deficit. It does not specify how to achieve these goals. Because apart from the “proprietary recipe” from the Ministry of Finance to reduce government spending, there are alternatives. For example, by curbing the appetites of natural monopolies, which, according to some economists, are the main engine of inflation. Perhaps the details are expected to be announce during the event.
Representatives of both camps err monetarist bias, while the brackets remain such important elements of any anti-crisis plan, as changing the system of taxation, currency regulation. Given that the presidential election in 2018 will require a financial “safety cushion”, chief specialist on creation of which Russia has traditionally been Alexei Kudrin, the chance to win his coalition are quite high.
The more that is literally at the end of April Alexey Kudrin has received increasing status — the post of Deputy Chairman of the Economic Council under the President of Russia. That reflects positively on its hardware weight.
Head of economic theory Department of the Moscow state University. M. V. Lomonosov Andrei Kolganov believes that the authors of both stories underestimate the depth of the problems facing the Russian economy.
— The position of Alexei Kudrin, who offers not to force the exit from the crisis, I totally understand. Since the state of the Russian economy is continuously deteriorating. In qualitative terms, this occurs throughout the entire post-Soviet period. In this respect the call not to rush seems more than strange.
“SP”: — In the opinion of the Deputy Chairman of the Economic Council under the President of Russia, the authorities simply do not have the resources to provide significant economic growth in the coming years.
I don’t think so. The same presidential aide Andrei Belousov indicates large amounts of retained earnings, which are now lying dormant in their accounts. As far as I know, Kudrin considers undue any interference of the state in market processes. They say that the economy itself needs to evolve due to the action of self-regulatory mechanisms. Accordingly, GDP growth can only be the result of the debugging of these mechanisms: reduce corruption costs, administrative barriers, improve the investment climate.
Only all that we have heard, when Alexei Kudrin was appointed Minister of Finance.
“SP”: — Not so long ago, his successor, Anton Siluanov has proposed to introduce a new fiscal rule and to send in the reserve of foreign exchange earnings in excess of $ 50 per barrel.
— In my opinion, is absolutely dead-end policy — the economy needs to be stimulated. But some government subsidies and by mobilizing existing reserves are not enough. It is necessary to carry out deep structural changes. I’m not arguing with Kudrin in terms of institutional reforms – judiciary and law enforcement. Administrative and criminal pressure on business, in fact, impede economic growth. But only through this economy not to lift.
As we are experiencing the decline of high-tech industries, ruined the connection between science, production and education. Here’s what you need to do in order of priority. Without lifting technology sector will not be the economic environment, where innovations are born. And without acceleration of innovation processes we will not be able to raise the competitiveness of its economy — with all its consequences. Russia will remain on the periphery of the world economy, unless a deep structural transformation in the economy.
“SP”: — That is, one fiscal incentives are necessary?
— Of course, we need measures related to planning and implementation of active structural policy. In order to concentrate resources on lifting the key high-tech sectors, which could play the role of locomotive of economic development. As well as the sources from which innovations spread to the rest of the economy. Incidentally, the increase in limits on project Finance, which the Ministry of economic development, it is a reasonable measure. We now have a situation, when almost all manufacturing industries are cut off from access to the “long and cheap” money. In such a situation to speak about modernization of the real sector is not necessary.
The problem is that major structural reforms will inevitably lead to violation of balance of convenience — someone will have to “come to heel”.
“SP”: — So, Kudrin offers to bring economic growth to the victim of the notorious elite consensus?
— It appears so. Although 1% GDP growth per year is not the best economic backdrop for a presidential campaign in 2018. Apparently, supporters of this paradigm believe that the existing margin of safety in socio-political terms would be enough. Do not undertake to predict which of the two models, the President will give preference. His economic policy in the years of the presidency, and during the Premiership was characterized by oscillations between the two courses is presented. With the General tendency towards liberal Kudrinskaya model.
Professor, doctor of Economics, Chairman of Russian economic society them. SF Sharapova Valentin Katasonov believes that both scenarios are bad.
— The impression is that this is a deliberate manipulation of public opinion, which leads away from understanding the main causes of the economic crisis. You can draw an analogy — a patient after an accident goes to the hospital, bleeding. Instead of trying to stop the bleeding, to make the anaesthetic injection, the doctors argue that it would be nice to send him to a resort or a sanatorium.
No institutional, fiscal, tax and other reforms cannot work because our economy is reminiscent of the “leaky bucket”, which is impossible to fill.
“SP”: — we are Talking about capital outflows?
Economists have been arguing about it. To stop the financial “bleeding” is possible only through restrictions on cross-border capital flows. Every year I count the balance of payments of the Russian Federation. Over the past 10 years, according to figures of the Central Bank, net capital outflow together with the outflow of investment income amounted to about a trillion dollars. There you are, enormous resources, the lack of which speaks g-n Kudrin.
Plus must be eliminated immediately offshore. Because it is not only a method of tax evasion, it leads to the loss of the ability to manage the economy. It is no secret that offshore centers are controlled by higher authorities. I believe this is normal when the Internet is full of advertisements like “we can open an offshore company in one hour”. You need to provide our “offshore aristocracy” of the period of one month. Who won’t put their assets to Russian jurisdiction, his business to be nationalized.
Of course, you can imagine the hysteria that will suit on this occasion our foreign “partners”. In the spirit of the beginning of the 2000s, when the Russian state began to transfer the balance of state-owned assets of Yukos. But this should be ready — painless options to get out of this situation does not exist.
Finally, I believe we must return to the events of December 2014, when there was a precipitous devaluation of the ruble, and to perform the actions of the Central Bank. Incidentally, Kudrin was head of the Supervisory Board of the Moscow exchange.
“SP”: — whether to attach such importance to the levels of fiscal deficit and inflation, as do the liberals?
I repeat, this is nothing more than a distraction of attention away from the essential, fundamental problems. I do not understand why the deficit may not exceed 1% of GDP, and inflation is 4%. On what calculation this is based? And, in General, what are the calculations in the conditions of chaos in economic processes. For example, the head of the MAYOR Alexei Ulyukayev loves to make predictions for the next 1-2 years. And has happened several times that the numbers do not match. Moreover, where in the forecast, plus, in practice it turns out negative. And Vice versa. Now the Minister prefers long-term forecasting. Because in 10 years, as they say, “either the donkey dies or the padishah will die”.
