Jan 27, 2021
0 0

Lies of the Central Bank and the Ministry of Finance in facts and figures

When you analyze the preliminary data for the past 2020 and try to simulate the situation for the current year, you understand that the score is not in our favor. I will illustrate with specific examples and facts. When the coronavirus crisis began, Russian officials of all stripes began to talk about the lack of money and opportunities to provide support to the country’s population. The general opinion was expressed by the second person in Russia according to the Forbes magazine – German Gref, whom, by a strange coincidence, Mr. Alexei Navalny never criticizes.

Here, as in that joke: what are three reasons why you should retreat? The first reason: we have no shells. It’s the same here: we don’t have that many “shells”; if the US can afford $ 3 trillion of debt and put it into the economy, then we have limitations. We have no restrictions on the amount of debt, it is 15%, in this sense we are one of the most prosperous countries in the world, we could distribute 20% of GDP to people …

That this is a lie can be proved by the following figures and facts. For example, over the past three years, the state budget has had colossal amounts of default. The money is collected in the form of taxes, but is not spent, but is kept in accounts with large banks. So, in 2018, this amount was 770 billion rubles, in 2019 – already 1 trillion rubles, in 2020 – another 1 trillion rubles. As the head of the relevant parliamentary committee, Andrei Makarov, notes, “the mess is complete,” but no one is going to cut taxes.

Gref claims that “there are no shells,” but that is a lie. There is money, but the Central Bank has withdrawn it abroad. More than $ 218 billion of Russian money was lent to foreign countries. For this amount, their debt securities were purchased. Almost $ 139 billion was placed on deposits with foreign banks. Almost $ 46 billion has been invested in foreign private companies.

The lion’s share of Russian money has been withdrawn to countries that have imposed anti-Russian sanctions! Yes, formally, China is in first place, but if you consolidate investments in Japan, Germany, USA, France, Great Britain, Canada, they account for more than 50% of the money withdrawn from Russia. It turns out that they are constantly lying and trying to manipulate us. Otherwise, how can you perceive the words that the Central Bank has made a serious contribution to the growth of the well-being of Russian families, which Ms Elvira Nabiullina said about?

Monetary policy, in my opinion, certainly contributes to the growth of welfare. Low and controlled inflation, why we fought for it so hard, its beneficiaries are the general population, – said the Chairman of the Bank of Russia. – Besides the fact that it has economic benefits in terms of its contribution to welfare, of course, low inflation makes this contribution. As soon as inflation begins to rise in our country, we understand how important this is for the well-being of people.

It is striking, but true – these characters talk about their contribution to the welfare of Russian households, but at the same time, if you analyze the numbers, you get, as the common people say, “laughter on a stick.”

Thank God, they helped families with children and those who were unemployed. But even this aid had to be knocked out of those who determine the budgetary policy in our country. Remember the scandals when the president had to intervene in this process, because the Finance Ministry did not plan to help children, and even payments to medical workers from the “red zone” did not reach the addressee at that time. Poverty and misery are overwhelming Russia, and Mrs. Nabiullina boasts of her contribution to the growth of well-being. Maybe she messed up the country? Maybe she meant, for example, the United States? This is our income decline over the past seven years, according to the official version, almost 12%, in reality it is getting worse. A different process is observed in America. There, assistance was provided to the population, as a result of which real disposable income rose during the coronavirus crisis to a level that has not been seen for many years. In addition, fiscal support has enabled Americans to increase savings and reduce debt. And this policy will be continued.

So, the former head of the US Federal Reserve Janet Yellen, whom President Joe Biden proposed for the post of Treasury Secretary, called for continuing large-scale injections into the American economy, despite the budget deficit and national debt. Referring to the $ 1.9 trillion “American bailout plan”, the former head of the US Senate Federal Reserve said that “without further serious action, we risk facing a prolonged and painful recession, which will subsequently lead to long-term damage to our economy.” From her point of view, it is quite safe for the country’s debt burden in a situation where interest rates are at historically low levels.

Economist Mikhail Delyagin believes that the fundamental difference in the financial policies of the Russian and American monetary authorities stems from the fundamental difference between their positions and their interests.

American financial authorities are people who directly serve the interests of the global financial and speculative class, who use America as their organizational structure, the American state as a base. And who are therefore interested in America’s well-being. Like an aircraft taking off from an aircraft carrier, interested in the well-being of the aircraft carrier. The Russian monetary authorities, like the American ones, are exactly the same liberals. But liberals, who are in a fundamentally different position. These are people who are regional managers. Their job is to organize, provide financial exploitation by the global financial speculative class of Russian territory. Therefore, there should be no development on the territory of Russia within the framework of liberal logic.

The officials who determine the financial and economic policy in Russia do not agree with this. They argue that their course is correct, and that the policies being pursued abroad lead to default. This is, for example, the position of the Minister of Finance of Russia Anton Siluanov:

Of course, last year I had to soften my policy a little – this was justified, but this cannot be permanent. We have set ourselves the task of reaching an absolutely normal budgetary and monetary policy. These high debts, this big pumping do not pass without leaving a trace. Someone has to pay for this. Who! Citizens. Ultimately, this will happen either due to an increase in inflation, or we will see that government spending will have to decrease and, therefore, the quality of services will decline. Nothing just happens in the economy. If you easily allocated money today, softened the rates, then you will pay for it later. We have faced this kind of situation many times. We even had a default situation. We issued bonds, could not service debts. And it seemed: now, now everything will start to grow, we will receive income, we will extinguish it. Nothing like this. You have to pay and you need to understand this. It is necessary to go to normal tracks, to normal principles. We will do this in Russia.

It’s amazing … To whom does Mr. Siluanov turn when inquiring about the debts he has collected? After all, he and his department are driving the Russian State and its population into debt. Moreover, in foreign currency debts. Over the hill, they withdraw money at zero interest, while on Russian debts they give an excellent premium in foreign currency. Where is the logic? It does not exist if we consider the situation from the point of view of Russian interests. Ms Nabiullina went even further and stated that the policy, which, for example, the Americans are pursuing in terms of helping their population, is a gamble:

We remain in the more traditional sphere, for which we are often criticized, and Anton Germanovich and I are often advised to pursue an unconventional policy: these are low rates, even negative ones, asset purchases, when the debt increases indefinitely, a deficit, ” the head of the Bank of Russia noted. – Still, there are limits to such a policy, such an unconventional one. It seems to me that they are the countries that are testing a new frontier every time. It seems that nothing has happened, inflation has not increased, debts are being serviced and the next step is being taken. […] For Russia, this would be a gamble. This, perhaps, will be an adventure for the world. No one knows the long-term consequences, no one knows how it will end. But it is obvious that it is very difficult to get out of this policy. We see that those countries that set the task of getting out of it practically cannot.

Stunning logic, help to the population, soft monetary policy – this is a gamble, but the fact that the economy is in stagnation, and incomes have collapsed – is it not a gamble? The fact that the Central Bank is not responsible for the socio-economic development of the country, as, for example, the US Federal Reserve, is not a gamble?

Economist Mikhail Khazin believes that this is a purely economic logic offered to us by the IMF – the logic of a raw material appendage.

The raw material appendage does not need investments in the real sector. For this reason, we do not have money that serves for investment, in addition, since the time of Yegor Gaidar, the IMF has banned investments in the real sector in rubles in our country. It is assumed that only foreign investments can be made. They existed up to a certain point, but then they were canceled through sanctions. As a result, we have neither internal, ruble investments, nor external, foreign ones. Our economy is falling. And if we had a sovereign monetary system, we would create internal sources of investment. But the leadership of the liberal monetary authorities – Nabiullina and Siluanov – is prohibited. That is, in fact, the whole picture.

If we want to solve the key reasons for the growth of protests in Russia, we must separate the so-called liberals from the financial, economic and social policy of the state. Russia needs development like air, not following the recommendations of the IMF and other global offices. Enough to be in the wake of other people’s opinions, it’s time to solve the problems of your country yourself.

Yuri Pronko

Article Categories:

Leave a Reply