Degradation and Nationalization: The Inevitable Ways of Russian Autocratic Economic Policy
As Russian political scientist Gleb Pavlovsky has quite rightly said, one should not consider the five-thousand-plus sanctions imposed against the Russian Federation as of this writing as sanctions in the normal diplomatic and economic sense. They are a conditional “second front,” a blow aimed at dismantling the Russian economy, the Russian social structure, and the institutional framework in response to the corresponding actions of the Russian authorities, with the West’s clearly stated position not to mirror such actions.
To put it simply, it is a way to bring the costs of the current Russian policy to such a level that any benefits for the people who make political decisions drawn up in their imaginations would become absolutely insignificant and ephemeral in comparison with the huge and real costs in all areas and of all possible types. And it is also a signal to all social strata that the state and its policies are not just the authoritarian domain, the affiliated elite and their decisions, but all the strata and categories of the population that make up the country and their civic engagement.
This dismantling, in addition to the obvious and direct commercial, cultural, logistical, and other isolations, may have consequences that do not lie on the surface. Above all, of course, they are associated with social and economic metamorphosis. In particular, for example, an authoritarian dictatorship (not an informational autocracy!) and a growing market economy are mutually exclusive by definition. This is an institutional and economic axiom, and if anyone is interested in learning more about it, they can consult the classic works by Ludwig von Mises or James M. Buchanan; Daron Acemoglu and James A. Robinson’s The Economic Origins of Dictatorship and Democracy, on quantitative institutional economics; and Robert Barro’s brilliant and comprehensive work “Economic Growth.”
In addition, in this regard, I see inevitable contradictions between those statements and the already urgently enacted decrees of the Russian government to liberalize and stimulate conditions for small and medium-sized businesses and the inevitability of actually nationalizing a huge chunk of the entire economy. Yes, measures to liberalize conditions and roll back the state canopy could have been an effective step to keep the economy and social
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