Published On: Wed, Jan 21st, 2015

As Duma Lacks Economic Solution, Russia’s Rich Keep Playing

Russia's Rich

A word to sum up the mood Russian citizens may be “disillusioned, ” particularly with its government’s inability to pull the economy out of its quagmire. The fall in the price of oil, which comprises much of Russia’s GDP, sanctions, rising inflation and the falling ruble have struck the economy a devastating blow.

Meanwhile, Duma deputies were gathered to try to come up with a solution. One obvious move is to cut spending, but it is difficult for Duma officials to know what to cut; they depend on guidance from the leader of state and know that austerity measures will create further mistrust among their constituents, as reported by The Moscow Times.

The World Bank has forecast that it expects Russia to grow by negative 2.9% down from negative 1.5% as inflation soared to 11.4% last month. The IMF thinks the Russian GDP will drop by 3.5% each year. The Duma is being held increasingly responsible for Russia’s economy, despite the fact that a combination of factors come into play. Dmitry Oreshkin, head of Mercator political research group, said, “Duma deputies will have to change the budget one way or another. It is logical to have them be part of the process. What will be left for them to do if they cannot debate about the economy.”

Just when the Duma talks of tightening belts, Alexander Sidyakin and Oleg Savchenko were missing from a session. The two took off on an extravagant trip with cost three million rubles, or 100 times more than the average salary of the working Russian. The two men are well-heeled and the perception that their behavior was arrogant will likely bring them before the Duma Ethics Committee.

Many Russian billionaires have lost money in the ruble’s decline, but are still living extravagant lifestyles. Steel billionaire Alexander Abramov has a huge property in New Zealand with several separate homes. To prevent having his lavish activities interrupted with a power outage, he has built an on-site power station.

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