Are Russians As Rich As Czechs?

In terms of new cars, they now are. According to 2011 statistics, Russians bought 17.6 new automobiles per 1000 people. This indicator is still quite a bit below most of Western Europe, such as Germany’s 38.5, France’s 33.4, Britain’s 31.9, Italy’s 30.1, and Spain’s 20.0. However, it has already overtaken most of East-Central Europe, whose figures are: Czech Republic 17.0, Slovakia 12.5, Estonia 11.7, Poland 7.2, Hungary and Ukraine both 4.5, Romania 3.7. Likewise, some countries that by the 1990’s came to be regarded as natural parts of affluent Europe are now behind Russia on this measure: Portugal 14.4, Greece 9.0.

Now this is just one example, and the market for one consumer durable good isn’t going to be perfectly reflective of the overall situation. The crises in the PIGS may be temporarily dissuading nervous consumers from making large purchases; another factor to consider is that their overall car fleets are bigger and newer than Russia’s, so there is not as much of an incentive to get new cars. And taking into account a much larger basket of goods, the World Bank estimates Russia’s GDP per capita (at PPP) to be $20,000, which is still considerably behind $25,000 in Portugal and the Czech Republic, and $32,000 in Spain.

What’s all the better is that the current improvements in Russia’s relative position are happening against the background of extremely benign debt dynamics; aggregate debt is only 74% of Russian GDP, compared to 184% in China, 280% in the US, and more than 300% in most of Europe. This leaves it with a great deal of fiscal and monetary wiggle room in the event of a renewed global crisis that is no longer available to the developed world or lauded emerging markets such as Brazil, India, Poland, Turkey, and Poland. While the affluence gap between Russia and the most developed nations remains large it is nonetheless being steadily and sustainably closed.

The Nazi-Soviet Pact as Second Munich

On the 70th anniversary of the Molotov-Ribbentrop Pact of non-aggression between Nazi Germany and the Soviet Union, signed on August 23, 1939 (also my birthday!), historians, ideologues and everyone in between inevitably fall into a game of recriminations, revisionism and relativism. The anti-Soviet side maintains that the Pact gave Germany a free hand in the west and contributed to the onset of war, as represented by OSCE’s recent recognition of Nazi-Soviet equivalence in their culpability for the Second World War. On the other hand, most Russian historians stress that the Pact was a) justifiable on the basis of the Western betrayal of Czechoslovakia at Munich in 1938, and b) gave the USSR valuable time to build up its military-industrial potential for the coming war with Germany.

The “Westerners” (and their liberast Russian allies) tend to impute sinister motives to the Russian leadership’s recent efforts aimed against the “falsification of history” – seeing in them a revival of totalitarian and expansionist thinking, whereas the Russians see this as Western-sponsored “revisionism” whose aim is to impose a sense of historical guilt on the nation. Considering that a glorified version of the Great Patriotic War is fast becoming Russia’s national myth, any acceptance of responsibility for its outbreak is ideologically unacceptable, an a priori anathema. This pits Russia directly against the Visegrad nations of the former Soviet bloc, whose occupation and repression under Soviet / Russian rule – yes, they view the two as interchangeable – is a staple of their national myths, and consequently also brings Russia into a new ideological conflict with the wider West.

Given the huge role of these underlying emotional, ideological and spiritual factors, there is little space left for objective history. But one can try by hi-lighting the kind of international environment the USSR faced during the period and the sense of insecurity that the Western nations instilled in its government through their actions… I’ll start by translating, summarizing and expounding on a timeline meticulously compiled by Sergei Fedosov [my additions] – please see link for his sources:

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