Good intentions do not always lead to good results
In the course of today's "war with oligarchs", politicians are trying to reach consensus on how to ascertain oligarchs’ unlawful activities in their private companies. The idea is not novel. Such plan could have easily been implemented earlier if only the prooligarch lobby in the State Duma along with oligarch-controlled mass media did not stand in the way. The situation will most likely change after the elections to the State Duma, enabling state officials to edit all the necessary laws in regards to such matter.
Governor of the Saratov’s province Dmitri Ayatskov has publicly announced today that oligarchs must give their extra profit to the government. "I doubt those people who were able to make billions of dollars in the course of the past decade", stated the governor in his interview to a Russian newspaper. –"There are many people with similar abilities and similar rights in accordance with the 19th clause of the Constitution. In times of privatization of the government's property, however, some had an access to certain information that others lacked. In the end they were the ones with most precious possessions such as oil plantations, gas and metallurgy." "I am not saying that we should simply take it all away from them. We should lawfully acquire their extra profit."
Well, it is hard to argue. The entire process of privatization which took place a bit more than a decade ago had been rather ruthless. As a result, instead of investing in Russian economy and receiving considerable dividends, the entire population was robbed of its resources and completely removed from the economic life of the country. There is a twist nonetheless. For if we kill a bird with golden eggs, we will only be able to taste it once.
Judging by some of the politicians' talks, few of them doubt that collection of extra profits from oligarchs will be enough. More so, considerable efforts have to be made in order to obtain that money in the first place. Long and exhausted court cases, rapid crushes of peoples' life-long carriers, these are just a few inevitable consequences. In any way, it needs to be done. And it needs to be done all at once. There will probably be nothing left to acquire next time. Therefore, the sooner we take actions regarding such matter, the more money we get. Time is money. But wouldn't it be better to create an entire legal system aimed specifically at a regular profit acquisition? Sure. It turns out, government's geniuses have already thought about it.
The way private companies today strive to distribute the money to their shareholders in dividends can hardly be left unnoticed. The Russian tycoon "LukOil" for instance, decided to pay off its 15% of dividends strictly according to the US GAAP standard. Another major company "Norilskii Nikel" is paying 20% to its shareholders. "UKOS", while in turmoil, has promised to pay 40% of clean profit after completing merging with "SibNeft". As far as "SibNeft" itself is concerned, the company decided to spend its entire profit for the past year on dividends, a sum of $1 billion.
Looking at today's events, it seems like political leaders have already made up their minds in regards to major government companies. Government officials are perfectly aware of those companies ruled by the oligarchs. They will be main targets of new soon to be made reforms. According to the Russian media, the government has already decided to collect almost the entire profit of "Gasprom" and "Transneft" in a lawful manner. More so, such dividend politics of the Ministry of Economic Development is planned to be legalized during a government’s meeting on November 27. We can only guess the reaction of oil tycoons. Something tells me they are not going to be pleased.
Majority of the governments' companies however have been behaving just as badly as those private oligarchs. Whereas the latter have been consistently running away from tax collectors, the former attempted to minimize their dividends as much as possible.
Hoping to discipline present entrepreneurs, government officials from the Ministry of Economic Development along with the Ministry of Property decided to develop several universal rules for all of the governments' companies.
So what are these rules anyway? Both ministries suggested to collect the actual companies' profits as governments' dividends. It should be noted that not so long ago the Russian Ministry of Finance had been able to amend a law pertaining to the "Russian Bank" case. As a result, starting next year, Russia’s Central Bank will be obligated to pay 100% of its profits to the Ministry. The Ministry in turn, will then decide how much money it will give to the bank. This was the main reason why Victor Geraschenko a former vice-president of the Russia's Bank had been fired some time ago.
Unofficially, companies' staff members express their negative attitudes towards such "new plan" of the government officials. Well, they will have to get used to it. Eventually, there will be no other way for the companies but to give away their profits. They can also hold off paying their dividends. However, there might come a time when equipment will fail and bank credits will be unable to aid. In the end, there will simply be nothing left to take. This all might appear rather unreal for the governments' officials, for they are not used to think ahead. Their main job is to get money and to get them today. Who cares what tomorrow brings!
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