Continue the discussion on the implementation of the may presidential decrees in 2012 (in total there were signed 11).
I started with the consideration of the presidential decree of may 7, 2012 No. 596 “On long-term state economic policy”. The analysis was performed on four targets: 1) number of high-performance workplaces; 2) the relative level of fixed capital investment (relative to GDP); 3) teleproduction high-tech and knowledge-intensive industries in the gross domestic product; 4) productivity.
For all four indicators received the same result, which can be expressed briefly — a complete failure. For example, the last-mentioned indicators, the task was to increase over the 2011-2018 period labor productivity 1.5 times, and she (even with the well-known “efforts” Rosstat) rose only 5-5,5%.
Let us turn to the evaluation of the performance of the last in the list of the main target indicators of the decree No. 596. At number five is: improving the position of the Russian Federation in the world Bank’s doing business from 120th in 2011 to 50th in 2015 and 20th in 2018.
Before you begin the performance assessment, would like to stay on the index. If other indicators may decrees of 2012 are calculated by Russian organizations and agencies (mostly the Federal state statistics service), the ranking in terms of doing business, as can be seen from the wording of the decree No. 596, is calculated by the world Bank.
So, it turns out that the assessment of long-term economic policy of the Russian Federation is expected on the basis of external ratings. The fact that the presidential decree tasked to develop, using as benchmarks the foreign (international) star rating, I take it as a “Freudian slip”. The power of the unconscious recognizes that the country is under external control. Focus on the country’s external evaluation is an important sign of weakness or even the absence in the state of national sovereignty.
There is a sense to take a break from our main topic of the may decrees and to consider how Russia generally depends on external ratings.
Still any half a century ago in the world of such assessments. The world economy was estimated and measured by the usual cost and natural indicators. By virtue of the fact that exchange rates were fixed, it was easy to make international comparisons of national economies. After Jamaican international monetary and financial conference fixed rates were abolished, the world has entered a period of General “volatility” and traditional values have become bad masters. Appeared rating, which were made by different international organizations (like world Bank or world economic forum) and “independent” experts. Behind them, as the rule stood influential “customers”, which the rating evaluation needed to achieve their economic, financial and political goals.
In the economic and financial world has introduced three world-renowned rating agencies — Fitch, Moody’s, Standard & Poor’s. They all pose as “independent agencies”, but in fact they are under the strict control of the “masters of money” (the main shareholders of the Federal reserve system) and act solely in their interests. I have these three rating agencies are called “conductors” of the international financial system and world economy.
It is noteworthy that his “the Agency” did not disclose that all should believe their word. More than strange, that they for many years exhibit a higher assessment of the American economy with the largest debt in absolute terms and one of the highest relative (relative to GDP). A real shame for the “big three” was that the rating agencies failed to signal in 2008 on the onset of the global financial crisis. I’m not talking about such “trifles” as, say, the history of sovereign default of Ukraine in December 2016. It was a moment, when Kiev had to repay its sovereign debt to Russia worth $ 3 billion. Kiev (incited by Washington) did not. And the international monetary Fund and rating agencies “big three” do not “noticed”. In particular, none of these agencies has not changed its estimates in respect of Ukraine.
It is regrettable that Russia in 90th year firmly hooked on the rating “the big three”. Monetary authorities (Central Bank and Ministry of Finance), wrote of normative-methodical documents, which necessarily included the use of ratings by the “big three”. To assess the “big three” have sought large Russian companies and banks, which came to the world’s financial markets (in particular, in the case of placements of their securities in the form of IPO).
Only when against Russia were imposed economic sanctions (from spring 2014) and even the blind became clear that the “big three” on the team from the “masters of money” plays openly against our country, the Russian authorities have taken the decision to abandon the use of rating assessments of foreign agencies. In July 2015, was adopted the law “On the activities of credit rating agencies in the Russian Federation”, and two years later was the final transition to rating evaluations conducted by Russian agencies on the so-called “national scale”.
But in the world today there are dozens of other international rankings, which involve Russia. And, unfortunately, we must admit that our officials and other leaders often are under the hypnotic influence of the relevant ratings. The status and authority of international rankings are very different. Some, as I said, are developed by international organizations (WB, WEF), and other major news agencies and reputable periodicals (“Bloomberg”, “fortune”, “Forbes”, etc.), and others — private banks and global corporations, the universities and “brain factories”. Will list just a few world rankings in which for many years featured Russian Federation:
Global Competitiveness Index (global competitiveness Index, developed by the world economic forum);
MD World Competitiveness (competitiveness Ranking of countries, the Swiss business school IMD);
Index of Economic Freedom (Index of economic freedom, The Heritage Foundation);
The ranking of the best countries for business (Forbes magazine);
Legatum Prosperity Index (prosperity Index countries, the British research center Legatum Institute);
The ranking of the best countries (the magazine U. S. News & World Report in conjunction with the consulting company BAV Consulting and Pennsylvania state University);
Human capital index (world Bank; a separate index is developing the world economic forum);
The world ranking of happiness (Sustainable Development Solutions Network — a division of the United Nations; a similar rating is an international research center Gallup — Gallup International).
I have mentioned only a fraction of the ratings, which include the Russian Federation. Picture estimated to be obtained by Russia, very colorful. For example, the latest layout for some ratings (end of 2018): 199-th place in the ranking of universities; 154th place in the global peace index (last ten countries); 110-th place in terms of charity; 104-th place in the rating of quality of roads; 96th place in the ranking of well-being; 53rd place in the rating of health; 52-e a place in world environmental ranking; the 49-th place in the ranking of the happiest countries; 47th place in the speed of the Internet connection; 43rd place in the global competitiveness Index; 43rd place in the Index of human capital (WB); 25th place in the ranking of innovation; 2nd place in the rating of arms.
For many rankings of the “kitchen” of the settlements was not disclosed. Other techniques presented, but in these tiers a lot of “garbage” and “subjective” indicators (e.g., risk measures). Some rankings use surveys, but the methodology of surveys and the circle of respondents, as a rule, were not disclosed. In General, the ratings resemble a “pig in a poke.” They also resemble some child’s game in a sandbox. Although the goals of those who organized these games, is not for children. It is a means of controlling economic and political processes in the world. If it “promoted”, we can safely say that behind them are the “masters of money”, for the “promotion” requires a lot of money.
And now back to the may decree № 596 of his figure “position of the Russian Federation in the world Bank’s doing business.” Be honest: becoming embarrassing for the President and it’s a shame for the power that the evaluation of Russia’s economic policy are invited to use the specified rating.
First, because this is an external evaluation. And it is the world Bank. And this international financial institution “controlling stake” (as in the International monetary Fund) belongs to the United States. Specifically the United States at the world Bank is the U.S. Treasury Department — the one that is developing new packages of economic sanctions against Russia. To focus on the rating assessment of the world Bank — about the same crazy, as if Stalin during the war with Nazi Germany would take military decisions based on “recommendations” of the General staff of the army of the Third Reich.
Second, because the specified rating of the world Bank (Doing Business rating — DBR) has long had a bad reputation. The first rating was published in 2005. Then in the first place was New Zealand. From 2007 to 2016, the rating has consistently led Singapore from 2017 leadership regained New Zealand.
Each country is assigned an overall Index of business environment (Doing Business Index — DBI). It is based on ten indicators of internal:
1) starting a business (procedures, time, cost and minimum capital for the Foundation of the enterprise);
2) Work with construction permits (procedures, time and costs to build a warehouse);
3) Obtaining electricity (procedures, time, costs for obtaining electricity supply);
4) Registering property (procedures, time and cost to register commercial real estate);
5) Getting credit (strength of legal rights, depth of credit information);
6) Protection of investors (openness financial performance, management’s responsibility and the ease of lawsuits from investors);
7) Payment of taxes (number of taxes, preparation of tax reports, total tax as a share of the profits);
8) international trade (number of documents, cost and time required to export and import);
9) enforcing contracts (procedures, time and costs to enforce payment of the debt);
10) Closure of the enterprise (percentage of reimbursements for the costs of closing insolvent firms).
Already at the start of the DBR rating system has been criticized. It was noted that it is based only on the study and quantification of the laws, regulations and rules relating to the conduct of business activities. The index does not account for more General conditions such as infrastructure, inflation, crime, corruption, the profitability of the business and other. Between estimates of the EOS and the real picture of the economic situation of individual countries, as they say in Odessa, “two big differences”. The world Bank represents the evaluation is not real and “paper” economy. Rating assessment of the DBR have a strong political overtone.
So, for several years the top ten ranking includes Georgia. It proudly coexists with New Zealand, Singapore, Denmark, Hong Kong and South Korea. It turns out that in one of the poorest countries of Europe the business environment is better than in the US. This result for a country whose GDP per capita at current prices barely exceeded 4 thousand dollars, is astounding. It is also unclear why a significant portion of its working-age population looking for work outside of their country.
From time to time in the rankings of the world Bank on the high lines are countries such as Zambia or Rwanda, ahead of several European countries. Experts explain these paradoxes is very simple: it is not about the conditions of doing business in General, and about the conditions of doing business by transnational corporations (TNCs).
At the beginning of the current decade, an independent group of experts, which was to prepare the conclusion about the advisability of continuing the world Bank the preparation of rating assessments. Group in 2012 proposed to terminate such activities. However, who stood at the helm of the new world Bank head Jim Yong Kim saved the DBR system. He vowed to revise the rating system to make it more “transparent” and “objective”. However, almost nothing has changed. But last year the world Bank was a real scandal. The chief economist of the world Bank Paul Romer 12 Jan 2018 dared to expose public criticism of the “Doing business” ranking. This caused a panic in the power structures of Washington and then Paul Romer was fired from the world Bank (former Professor of Economics at new York University, returned to his former place of work).
I think that in 2012, when preparing the draft of the decree No. 596, nimble officials have made the inclusion of assessment DBR, because mark was a snap with the preparation of a bunch of regulatory documents. And, if you carefully study what was done on “paper” part, the documents were written just for ten groups of criteria required for calculation of the overall index DBI. In the “paper” economy, our officials are adept and can really give the bureaucrats in other countries.
In 2011 Russia occupied the 120th place. But today, she is already on the 31-th row. On the line above Russia — Spain (30th place), one position below France (32nd place). Yes, technically the presidential decree was not executed because he demanded to go in 2018 for the 20-th line. However, the rise dizzying: from 120th place on the 31st. that’s all for seven years! Well, I have not held a little to the coveted 20-th line, but the dynamics of a kind! And the Minister of economic development Maxim Oreshkin at the end of last year, when it was published last rating DBR, swelling of importance and spoke with pride about the “economic achievements” of the country. How not to swell with pride, if ranked below Russia were Switzerland, Belgium, Netherlands, Italy and many other European countries.
But it seems to me that the estimates from the same “Opera,” in which Minister the more praise in the West, the more successful he takes the positions of Russia and the West. Remember how at the time, Alexei Kudrin , the ocean was named “best Finance Minister”? And now the world Bank “playing to” the Minister of economic development Oreshkin, which your post clearly obeys all the commandments of the “Washington consensus”. But officials from Switzerland, Belgium and other European countries do not feel that was below Russia and chuckle to myself, because I understand that the rating of the world Bank for the “uncivilized natives”.
It is very sad that in the new the may decree “On the national goals and strategic objectives development of the Russian Federation for the period up to 2024” we see the Russian government continues to be dependent on international ratings. Thus, paragraph 5 of the decree States: “the government of the Russian Federation in the development of national project in education to assume that in 2024 it is necessary to provide… joining the Russian Federation among the 10 leading countries in quality of General education”. So, again, it is necessary to focus on international rankings that assess the level of education. I already wrote that such ratings are only destroying education, so as to stimulate commercialization activities of educational institutions.
And in paragraph 10 of the decree, where is spoken about a national project in the sphere of science, is the following task: “ensure the presence of the Russian Federation among the five leading countries engaged in research and development in areas determined by the priorities of scientific and technological development”. Own ratings of countries in terms of development of science and technology Russia is not developing. Therefore, most likely, again will have to rely on foreign ratings. And they are as follows from all the above, are unreliable and even dangerous goals.
P. S. by the Way, Mr. Oreshkin, judging by the number of his performances, he continues to believe that the world Bank’s doing business still remains the most important target indicator. And promised that the Ministry of economic development will achieve the installation of the decree No. 596 for the removal of Russia on 20-th place in the ranking of the world Bank. If (God forbid) happens, it is likely that the Russian economy is already a little than differ from the economy of Zambia, Rwanda or Georgia.
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