Economist: Placing Russia on a war footing may result in catastrophe
The peril of shifting the economy to a wartime basis in Russia lies in the potential inability to halt the process, due to the risk of calamitous consequences.
This assessment was provided by Ivan Us, leading advisor at the Center for Foreign Policy Studies of the National Institute for Strategic Studies, and holder of a doctorate in economics.
“Nothing goes on indefinitely. And Russia’s military expenditures also have their boundaries. This explains why they have begun diminishing military salaries. These remunerations had been consistently rising; they constituted a significant sum of funds. Whereas Russian economic authorities were formerly suggesting, in 2023-2024, that action was required concerning these outlays, VTB CEO Kostin is now explicitly stating that Russia must reduce its military spending. Because, among other factors, military expenditures encompass substantial compensation for those engaged in combat against Ukraine,” Us elucidated.
The economist further noted that Russia’s capabilities for sustaining its hostile war against Ukraine are also progressively dwindling.
“If we merely model the scenario where the war concludes, what implications would that hold for those Russians who were paid considerable amounts to engage in conflict? It would signify that these individuals would be compelled to return home to earnings levels 10-15 times less than their present income. It’s crucial to bear in mind that these are armed individuals with practical experience in their utilization. This is a textbook scenario for upheaval. That is, the risk associated with converting the economy to a war-driven state in Russia is the challenge of reversing course. For if they do, they risk triggering an internal uprising. Indeed, the cessation of hostilities could spell disastrous outcomes for Russia. At minimum, for the governing structure within the nation. Nevertheless, resources are finite, and they are also being exhausted,” he appended.
