Russian Finance Minister: Higher military spending, lower oil prices led to collapse of USSR and can do the same to Russia

Anton Siluanov, Russian Finance Minister (Image: vedomosti.ru)

Anton Siluanov, Russian Finance Minister (Image: vedomosti.ru) 

Analysis & Opinion, Russia

Yesterday, Russian Finance Minister Anton Siluanov became the most senior Moscow official to say what many independent analysts have said before: large increases in defense spending and falling oil prices led to the disintegration of the USSR, and the same two trends can have the same impact on the Russian Federation.

The finance minister said that spending on the army and the production of military goods has now reached the level of three trillion rubles and that such spending, unlike investments in other sectors, “does not have a productive character.”

The Soviet authorities at in the 1980s faced the same problems when they increased military spending, Siluanov continued, and “when to this was added a decline in the price of oil, we saw what this led to: the state disintegrated.” Failure to recognize these linkages can have equally serious consequences for the Russian Federation.

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Edited by: A. N.

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  • Dagwood Bumstead

    This is nothing new. When Alexei Kudrin was Finance Minister he warned that Dwarfstan could not afford the dwarf’s ambitious plans for expanding the armed forces. At that time (2011) oil prices were well over $100. The dwarf sacked Kudrin for his impertinence.
    Now, with oil prices around $50-60, Dwarfstan can afford the dwarf’s wars and military adventures even less, yet the dwarf continues his lunatic policies. Siluanov may well be sacked, as Kudrin was. The end result- collapse of the Dwarfstanian Federation- is inevitable.

    • veth

      KREMLIN OFFICIAL: OUR TROOPS (WHO ARE NOT THERE) WILL NOT BE REMOVED FROM DONBASS!

      Ilya Shablinskiy, a member of Russia’s Presidential Council for Civil Society and Human Rights, admitted that Russia has effectively annexed and is controlling a part of the Donbas. Shablinsky made a statement to this effect in a broadcast of the “60 Minute” talk show on the Russian TV Channel “Russia 1”.

      “These territories are controlled by our [Russian] armed forces. The ruble circulates, the territory is controlled by the Russian Federation, the leaders of these republics implement our government’s plans. The Donbas is financed from the Russian budget,” Shablinsky said.

      The talk show presenters tried to repudiate his statements using statements that Russia’s “control” is limited to humanitarian aid in the occupied territories, but the studio guest stood his ground.

      “We have effectively taken this piece of the Donbas,” he insisted, drawing attention to the presence of Russian forces in the quasi-republics of the Donbas.

      “The Ukrainians say: ‘You haven’t withdrawn your forces’, our European partners say: ‘Yes, there are forces there, hundreds of tanks, hundreds of howitzers…’ They say that Russia isn’t complying [with the Minsk agreements],” he said.

    • veth

      Russia taking heavy losses as it gets drawn into the ground operation in Syria

      Wednesday, October 11, 2017 9:00:00 AM

      Former Donbas separatist commander Igor Strelkov, with reference to his own sources, reported the loss of numerous Russian soldiers in Syria.

      On his page on the social network Vkontakte, Strelkov cited the evidence of several sources who have fought in Syria

      Strelkov’s first source has fought as part of the Wagner private military company, and has recently returned from Syria.

      “According to him, in the last week three people in his platoon were killed and many were wounded,” Strelkov states.

      Strelkov claims that one of his former subordinates is in hospital, wounded in Syria while he fought as part of the Wagner Group.

      “And there [in the hospital] he isn’t simply ‘not alone’ – each week several people arrive. A particularly large number have arrived in the last two,” Strelkov explained.

      “I know from a third source that [according to estimates] over the last two weeks, the loss of ‘official soldiers’ is around 20, and the Wagner Group has lost more than three times as many. And this is ‘the minimum estimate’,” Strelkov claims.

      “Such losses of regular soldiers and mercenaries (who are essentially the same contractors) have been caused by the dramatic increase in battles against ISIS in the Deir ez-Zor region and Mayadin, where the Wagner Group is being used for assault divisions (the Syrians just ‘run errands’), as well as by militant attacks in the Hama province, where the Wagner Group has to rescue the military police divisions who are ‘getting into trouble’. Losses are also being taken in ambushes on communications and in fights to unblock the city of Al-Sukhnah, which is partially surrounded by militants, and in the region of the ISIS-captured city of Al-Quartyan. Everywhere, apart from (and often instead of) Syrians, Russian ‘cannon fodder’ is being used. In the same land battles which our unrespectable president promised to avoid entirely at the start of the Syrian escapade,” Strelkov continues.

      The Russian blogger el Murid (Anatoly Nesmiyan) writes that such losses are unsurprising. In his opinion, Russia is getting increasingly involved in the ground operation in Syria.

      According to Nesmiyan, the Syrian forces are virtually incapable of carrying out the ground operation, and so Russia does it for them.

      “In reality, the assaults at all the hot points of the Syrian war are made by Russian military forces, and even special forces are being sent into battle more frequently, and infantry as regular line divisions. There are no longer any other ways to ensure the outcome,” he writes.

      “This being the case, the Syrians themselves have already simply stopped fighting. The militants’ online resources are full of videos and photographs of fleeing Syrian soldiers, and of course, most of the failures in the south and in Hama are related to the widespread flight of local soldiers at the slightest sign of danger… Which results in Russia getting involved in the war in its ground phase. Nobody remembers Putin’s solemn assurances that there will be ‘no ground operations’. He lies so often and so much that one more lie or one less lie makes little difference,” Nesmiyan concludes.

      • Dagwood Bumstead

        The news from Syria keeps getting better and better- and brought to us by Igor Girkin of all people!

        • Rafael Hernandez

          Yes isis supporters and Ukrainian nationalists go hand in hand. May you become a martyr one day!

      • Rafael Hernandez

        Freedom comes at a high price. It is inarguable that Russia has destroyed isis eversince US made it stronger and bigger. Isis was at its height in 2015, but now isis has lost 90% of the land it once controlled. Thank you, Russia. You saved Syria from US imperialists

        • svend

          Thank you Russia. You destroyed a lot of hispitals, markets and schools and saved only a dictator for now.

          • Rafael Hernandez

            *Jihadists *Salafists *beheaders. There I correct you

        • gmab

          RuSSia targeting ISIS? LAUGH OUT LOUD. Question: Why do you live in the USA?

          • zorbatheturk

            Savushkina Street is a long way from Sunset Boulevard.

          • Dagwood Bumstead

            Raffie doesn’t live in the US, but in a mud hut in the bogs surrounding St Petersburg. But like all Savushkina trolls he dreams of living there. Unfortunately for him the US has no vacancies for Savushkina trolls, who have no real skills to offer a potenttial employer- nor, for that matter, does the EU.

        • zorbatheturk

          Savushkina snot on a stick.

      • zorbatheturk

        There are about 300 different anti-Assad rebel groups who will shoot any RuSSian they see. These guys have had enough of Mr Assad’s pillaging of Syria.

    • Screwdriver

      Collapse of the Dagestan may not be a bad thing, too many ethnic conflicts in that republic, normally ruled by Avars.
      Dargins and Laks can have they own sovereign states, why not ?

      • Brent

        Soon you’ll only be able to rely on your “toilet cleaner” salary and no longer be a paid stooge of the Kremlin Mafia.

        Are you still dreaming of setting up your own sovereign state of “Toiletbowlistan” in South Philly?

        • Screwdriver

          Ragulyako, still obsessed with a toilet in South Philly ? :-)
          Did you get raped and sodomized there by some dark skined local ? :-)

      • Dagwood Bumstead

        Nobody mentioned Dagestan, Screwie. Do you really have to keep demonstrating your illiteracy???

    • Rafael Hernandez

      Yawn, you have predicted RF’s collapse for 3 years now, but your comments seems to always be a little exaggeriated. IMF increased the economical growth in 2017 for Russia to 1,8% from 1,4%. It will also grow with 10% the next 5 years. Also nobody believes you after you constantly said that Clinton was going to win the election, lol

      • svend

        And you are still funny, stupid, but funny. But intelligent people never work as a Russian Troll.

        • Rafael Hernandez

          That is because you are an Ukrop. You cannot and will not understand anything thing about world affairs

      • gmab

        I’m sure you meant to say “10% in the next 50 years”. That is, if RuSSia is still around annoying all of it’s neighbours

      • Murf

        Hilary got 2 million more votes but they were not in the right locations.
        Trump eked out an electorial collage win.
        Know ANYBODY that saw that coming?

    • zorbatheturk

      It is a collapse that needs to happen. A $1.5 trillion economy cannot hope to be a global military power, nor should it even be allowed to challenge the EU.

  • veth

    http://gruz200.net/?p=341List of dead Russian soldiers in Donbass, by Russian sources……………..(long list for an Army, who is not there……….)

    • Dagwood Bumstead

      Note that this list is only of those that are confirmed as having been in the Donbas, are stil active in the Donbas or have been killed there. the real number is far higher- Alexander J. Motyl mentioned a figure of 10,000 dead Dwarfstanians some time ago, though he did not mention his source(s).

      • Rafael Hernandez

        I heard it was 1 million 😉

        • svend

          Just wishfull thinking

          • Rafael Hernandez

            Yeah, it’s just 100

        • Eddy Verhaeghe

          You hear a lot of things in your alternative universe…

        • Murf

          If only!

  • Oknemfrod

    To add to this insanity of pouring increasingly more rubles into their defense (or rather offense) budget – as usual, ending up half-stolen and laundered in off-shore accounts – the Russian military has nothing to show for it, judging from their performance in Donbas, Syria, and even the ludicrous recent “Zapad” (i.e. “The West”) exercise.

    It’s still a third-world force, whose claim to fame hinges on the “we can nuke you” concept. Its conventional warfare approach still relies on the paradigm of overwhelming a potential foe with sheer numbers, just as in the WWII, while it has no prayer either in a potential conflict with China or anywhere on high seas, as the “prowess” of their only “aircraft carrier” amply demonstrates.

    In this light, their budget-busting efforts to go “high-tech”, such as to build a gen-5 fighter in their feeble attempts to catch up with the already 12-year in production F-22 (good luck with that, let alone catching up with the F-35), are totally misguided, as they don’t fit in their ages-old military “cavalry attack” doctrine. The purpose of equipment like a gen-5 fighter is to achieve superiority with fewer pieces of more complex, expensive, and much less vulnerable warfare machinery requiring much more highly skilled personnel and sophisticated organization to operate.

    At the same time, within their existing paradigm, they need many pieces of much cheaper equipment and much less skillful personnel (so that both would be more or less disposable and replaceable) to have a shot at a single machine like the F-22, let alone the F-35. Even if (and this is a very big IF) they should manage to productionize the prospective Su-57 as a true gen-5 fighter (of which the Russian “Air-cosmic force” have ordered only 12 – in itself an indicator how “badly” they need it), they have got no proper military structure to use them effectively.

    So, in the end, it all boils down to wasting and stealing more money from the already impoverished populace and civil infrastructure with the financial effect on the country that is all too well preordained and known from their own history. Which is what Siluanov is trying to tell these morons; but the only result of his dire warnings will be his words falling on deaf ears or going in one ear and out of the other.

    • Brent

      As long as the West doesn’t offer to bail out Russia again like it did in 1992 and 1998!!! Let the Russki’s who love Putin so much chase him down with pitchforks like the Romanians did to their thieving tyrant, Nicolai Ceacescu and recover the billions Putin has stolen from them.

      • Oknemfrod

        True. But note than if (a very big IF) the stolen billions should return to Russia, they will be stolen afresh again by a fresh generation of pilferers.

    • Dagwood Bumstead

      Ordering only 12 Su-75s could also be an indication that the Dwarfstanian Air Force can only afford that many- or rather that few- despite the dwarf increasing the military budget yet again.

      • Oknemfrod

        Yup; it’s possible, too.

  • Rafael Hernandez

    Well as the oil prices are reaching 60$ dollars again, It won’t happen. Russia will continue to prosper and deliver peace to countries. It has already done that to Syria

    • svend

      Really??? Russia prosper, you mean Putler and friends. Peace in Syria, you mean the dead civiliens including children killed two days ago, right they have peace forever,

    • Murf

      When you find health care for 140 million people at 5 billion, your not prosperous.
      They are now tapping the pension fund and it will be gone by 2019.
      The space program is nothing more than a delivery service.
      The roads are. Ot being repaired.
      They are modernizing their T-72 tanks because the much ballyhooed T-14 is unaffordable.
      Also the overhyped Su-57 “stealth” fighter procurement has gone from 50 in 2013, to 12. As of now Noreway will have more 5th Gen fighters. That’s not even a squadron. Why bother?
      Does sound like prosperity to you?

  • gmab

    Obviously Russians have never heard this quote: “Insanity is repeating the same mistakes and expecting different results”.

    • zorbatheturk

      Any RuSSian who is not insane is locked up in RuSSia.

    • Dagwood Bumstead

      Precisely. The dwarf is making the same mistake Brezhnev and Co made, but from a much weaker basis.

    • Murf

      That was the first thing I thought when I read the article.
      Some groups of people keep making the same mistakes because they just can’t see any other path.

      • gmab

        Or are convinced not to.

  • zorbatheturk

    Damn right!