Eastern Europe

Putin Channels Soviet 5 Year Plan With New Expensive ‘Managed Economy’ Initiatives

Putin Channels Soviet 5 Year Plan With New Expensive 'Managed Economy' Initiatives
50th anniversary of 5-year plan. USSR postage block, 1979

Today Russian President Vladimir Putin’s government announced 12 major national initiatives to improve the average citizen’s experience in the Russian Federation; however, the effort channels the Soviet Union’s infamous ‘5 year plans’ which brilliantly showcased the inevitable failure of ‘managed economies’. The simple fact is managed economies always fail because the capital is misallocated, determined by bureaucrats, instead of the infinitely more efficient free market.

The Russian government has published information on its website about all the 12 National Projects, which are going to be implemented up until late 2024. The data were compiled on the basis of documents and certification from the National Projects that were approved at a session of the presidium of the Presidential Council for Strategic Development and National Projects dated December 24, 2018, reported Russian state news agency TASS.

The key areas of the country’s strategic development were established by President Vladimir Putin’s order of May 7, 2018. The document outlined 12 priority areas: the Digital Economy, the Ecology, Labor Productivity and Supporting Employment, International Cooperation and Export, Education, Culture, Small and Medium Businesses and Support for Business Initiatives, Healthcare, Demographics, Safe and High-Quality Roads, Housing and Urban Environment and Science. The work on these projects is aimed at “providing breakthrough scientific-technological and socio-economic development for Russia, increasing the standard of living, creating conditions and opportunities for personal fulfillment and unlocking every person’s talent,” the government stressed.

Russia will spend 25.7 trillion rubles ($391 billion) on carrying out President Vladimir Putin’s expansive promises to overhaul Russia’s economy by the end of his last term in office, according to a new government estimate, reported The Moscow Times. The plan was published Monday on a government website.

Non-energy infrastructure will be the most expensive project of the plan, at a cost of 6.4 trillion rubles, followed by roads at 4.8 trillion, ecology at 4 trillion and demography at 3.1 trillion. According to the government plan, 13.1 trillion rubles will come from the federal budget, 4.9 trillion from regional budgets and 7.5 trillion rubles from “extrabudgetary sources,” wrote The Moscow Times.

The Russian economy is slowly growing in low single-digits; however, many citizens believe the profits generated for the federal government due to higher oil prices over the last few years has been stolen by oligarchs while the public suffers due to significantly lower social expenditures on such items as medical care, eduction, etc. The Kremlin’s overseas adventures have also been very expensive and eaten up free cash flow.

Many globalist pundits tout the Chinese experience of ‘managing’ where capital is allocated in a fast-growing economy; however, this does not factor in the economic appeasement of American leaders which has ceased under U.S. President Trump. Recent tariffs on China have seen Beijing’s economy slip into recession according to many analysts.

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