Big Business, Visa Agony and Genghis Khan


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In response to "Not All Regions Created Equal," a front-page article by Alexander Osipovich on July 4.

This article on the economic changes in Pskov and elsewhere summarizes many of the obstacles to regional development in Russia. I might have added another -- the tendency of many regional authorities to promote businesses that are easy to tax at the expense of those that most contribute to economic development.
Some hint of this penchant for misdirected development can be found in the comments of Lev Shlosberg, the head of the Pskov regional branch of the liberal Yabloko party, who is quoted in the article as saying that "the state doesn't like to pick at tiny grains. It wants to scoop out big spoonfuls from the barrel."
This sentiment was expressed as policy in 1997 by the economic adviser to Pskov Governor Yevgeny Mikhailov, who declared that "one working factory will provide more tax revenue than all small enterprises taken together." Mikhailov himself went ahead to create that one factory, establishing a local vodka manufacturer that seemed to benefit from various forms of administrative support. To an outsider, it would seem a bizarre allocation of resources. Vodka had not been produced in Pskov in recent memory, and consumers could already choose from a wide range of brands "imported" from elsewhere in Russia. But vodka had one advantage over small business that the regional government could have promoted. It is, by Russian standards, relatively easy to tax, especially when production is concentrated in one local factory.
This pattern has repeated itself throughout much of the post-Soviet world, the consequence of tax systems that directed attention to a few large enterprises, thus diminishing the revenue importance of small business and other emerging sectors. Yet the outcome could have been different, as can be seen by what happened in Eastern Europe following the collapse of communism. There, the first postcommunist politicians cast the revenue net more widely, leveling the playing field for businesses eager to attract the attention of revenue-seeking officials.
Scott Gehlbach
Associate professor of political science
University of Wisconsin
Madison, Wisconsin

Men Are the Real Problem

In response to "Boosting Population a Vague Science," a front-page article by Nabi Abdullaev on July 11.

No country with a plummeting population can sustain its economy, let alone fulfill wide ambitions in the world. Yet Russia's rulers seem to grasp neither the seriousness of the problem nor the real causes.
Part of the reason is that no nation, even those at war, has ever undergone such a demographic shock like Russia's falling birth rate since 1989. As your article states, there are 44 percent fewer females from zero to 9 years old than there are from 20 to 29. In addition to the existing shortage of potential birth mothers and the country's poor output of 1.4 children per mother, a Russia with less than 100 million citizens in 2050 is not only possible but probable.
The government has come up with several programs to increase the birth rate, including paying 250,000 rubles ($10,800) to women for second babies. But none of those solutions will work well enough to slow the decrease because the primary cause is overlooked -- men.
Women usually do not rely on men for much help in raising children. Worse, when the marriage (or cohabitation) fails and parents live apart, Russian men often cease participation in children's lives. Child support payments in Russia lag behind Western nations in scale and enforcement. Women do the hard calculation of the practicality of children without the certainty of a man's help in mind, and find that large families are just not possible or too risky a venture.
Bill Pigman

Tormenting Russian Visas

In response to "Approve That!" a comment by Michele Berdy on July 11.

Regarding Berdy's statement that a visa "is an odd thing. It's just a piece of paper, or a stamp or a scribbled notation. But without it, a person can't get from one place to another," I agree with the first part of the statement, but not the second part. Visas are invented to torment tourists, students and business people and to prevent the development of friendly relations.
It is often said that visas are necessary to fight terrorism, but can anyone explain why visa are necessary between Russia and the European Union and not, for example, between Albania, Ukraine and the EU?
Between Russia and the rest of Europe, less then 1 percent of the visa applications are refused, which indicates that 99 percent of the law obedient citizens are faced with useless, expensive and bureaucratic paperwork that prevents the development of really friendly relations within greater Europe. Why do we, consumers, still accept this fraud of our authorities?
Jan Beerenhout
Russia Foundation

Ukraine No Threat to Russia

In response to "Why the Kremlin Is So Scared of Ukraine," a comment by Andrei Piontkovsky on July 3.

Ukraine's example of trying to follow its own path is hardly a threat to "Putin's model of a corporate, autocratic state." Earlier this year, shortly after his election as president, Dmitry Medvedev, in an interview with the Financial Times, made the firm point that the Western model cannot work in Russia.
Despite its many shortcomings, former President Vladimir Putin's restructuring has brought substantial improvements. The Russians are again proud to be Russians. The current Western myth is that, if it were not for oil's resurgence, Russia would be on the way to a collapse and that its present system of governance is self-defeating. Piontkovsky also suggests that Ukraine may yet swallow up what is left of Russia. I am afraid he may be getting it backward.
Boris Danik
North Caldwell, New Jersey

Future in Solar Energy

In response to "Looking Beyond Oil," a comment by Tobi Gati on July 2.

Would it not make logical sense for Russia to build the infrastructure and wealth of its people by developing solar-energy systems in areas that do not have energy or heat or air conditioning?
Why doesn't Russia take advantage of its unproductive lands and make them produce energy for those areas that are too far away to get electricity? That effort alone would provide jobs, build educational structures, enhance wealth and build potential and at the same time and make Russia the leader in reducing CO2 emissions, especially where manufacturers use a lot of electrical energy.
Russia should think more about how the world will be like in 20 years and envision how it can take advantage of solar energy. Only Germany has seen the light, and even the United States is lagging behind. It amazes me that the minds of politicians in the United States would rather build nuclear plants than build sustainable free energy that does not lead to cancer or death by radiation sickness.
I believe Russia is smarter than that. With resolve, President Dmitry Medvedev could revolutionize the world, without having to takeover anything but the country's own, unused land.
Gregor Smith
Oklahoma City, Oklahoma

Putin Is No Genghis Khan

In response to "Genghis Putin," a comment by Michael Auslin on June 24.

Regarding Russia's increased trade ties with Mongolia, what the author is really saying is:
1. The world should unite against "red" Russia and label its leader as "Genghis"? This is an unfounded ad hominem attack on a respected world leader.
2. The world should attempt to invest and trade with Mongolia before Russia does, even though Russia was smart enough to think of it first.
3. Investing in Mongolia by Russia is "strong-arming," but wholesome and good if it is done by the United States and its Western allies.
Jennifer Covey
Federal Way, Washington

Respect a Military Tradition

In response to "When Success and Image Don't Mesh," a front-page story by Anna Smolchenko on June 27.

After over 60 year of bashing the Soviet Union and Russia, it's very hard for the media to change its habits. This article, including the photo of the military parade on Victory Day, was no exception.
The last military parade on the Red Square was not made for the consumption of the West, but for the Russian people.
It is a Russian military tradition that the government decided to resurrect. It is not that much different from the Bastille Day military parade in France on July 14 each year. Does France's annual military parade represents French imperialism?
Sergei Loutchaninoff
Kingwood, Texas