Russia On the Edge of Social and Economic Crisis

The living standard is improving only for certain categories of people
Experts emphasize a blatant contradiction of the modern social and economic situation in Russia. The visible improvement of economic indexes do not affect the social situation. One may say that the living standard is improving only for certain categories of people. The payment arrears are growing both in the budgetary field and in the private sector. Despite high oil prices and the economic growth, the number of Russian living below the poverty line is around 36 million. What is hidden behind the phenomenon?

Andrey Shmarov, director of the analytical center Expert believes that Russia is on the edge of the social crisis. Mr. Shmarov expressed such an opinion at the conference "Corporation, Social Responsibility and Local Authorities Cooperation Models," RusEnergy news agency reports.

Andrey Shmarov said the specialists of his center had come to that conclusion as a result of the research concerning the relations between large corporations and local authorities and the system of inter-budgetary relations in the Russian Federation.

"The country is on the edge of the social and economic crisis. Probably, the crisis has already started. I am emphasizing the social side of the crisis," Shmarov said. In his opinion, the state has virtually stepped aside from the social restructuring of  business, which has become the reason for the crisis.

Andrey Shmarov added, corporations are forced to solve the questions connected with the withdrawal of social assets, the release of labor force, the maintenance of the housing infrastructure and social programs. Companies have to face tens of millions of dollars of annual expenses - their production becomes noncompetitive on the world market. On the other hand, the analyst believes, it is clear that the reduction of costs may lead to serious social consequences. "There is no answer to the question who is responsible for the further fate of a fired person - it is rather dangerous," the exerts said.

However, neither entrepreneurs, nor officials want to deal with the fate of "unnecessary people" in Russia. As a result, unnecessary people have been left to political demagogues and extremists. What will happen in ten or twenty years? No one wants to think about it today, although in may be too late tomorrow.