Grigory Pasko: Power over the Purse Strings

During an international investment forum held last month in Moscow, Premier Putin boldly declared: “We are going to economize every ruble of the budget in the strictest possible way!” He also said a whole bunch of other things there – with emphasis on the words, with repetitions sounding like mantras. In a press release distributed as the conference came to a close, it was indicated that: “Forum participants are going to try to determine the most attractive innovational sectors of the Russian economy for foreign capital.” And yet it is understood: these efforts are required because investors are not rushing into Russia, turned off in part because the state budget never ends up where it was promised to go.

The putinites are promising them mountains of gold, are painting preferences, promising milky shores and berry-soup rivers… But the finicky foreigners turn up their noses: we, they say, have got dependent courts, no political competition, people’s rights are getting violated… I think such words irritate comrade Putin. It is said, after all: we shall promise you whatever you want!However the one thing that Putin cannot and does not promise is the integrity of investors’ capital – which, once dropped into our territory, becomes easy prey for a number of predators, with the Kremlin at the top of them all.And oh how the putinite power knows how to «safeguard every ruble»!Let us take a look at just a few examples.Example № 1. In Kabardino-Balkaria it is being planned to build an all-season mountain resort «Prielbrusiye», including within itself the construction of an electric substation, electrical transmission lines, a high-speed surface railroad, an airport complex. The overall volume of investments is going to comprise 107.8 bln. rubles. In greater detail here.Example № 2. On the realization of the Federal targeted programme “The South of Russia” (the years 2008-2012) from the budget of the RF will be allocated 52 billion rubles.In 2008-2011 Chechnya may get 80 bln rub., including 65 bln rub. from the state budget, and the rest – from companies.Example 3№. According to the most understated data, the economic harm caused in the course of two bloody wars in Chechnya comprises no less than $100 bln doll.Example № 4. On account of the funds of the budget of Saint Petersburg it is being planned to expend:• on the construction and reconstruction of fountains — 275 257 thsd. rubles;• on the capital repair of fountains — 21 254.6 thsd. rubles».Example № 5. Head of the MFA of Ukraine Hryshchenko said about «South stream»:

«This is an unusually expensive project. On the strength of the geology, on the strength of the particular expanse, on the strength of the fact that the Black Sea is much deeper than the Baltic, the project is going to cost, by not our appraisals, but those of western experts, on the order of 20 billion. Is there a need to spend this money when an alternative exists? There is an alternative. This is the Ukrainian gas transport system».

Example № 6. Recently in Samara with huge elan they commemorated the Day of the ending of summer. The «City festival», which ran the treasury 25 million rubles, for some reason was actively accompanied by pre-election agitation for the mayor of Samara, member of «A Just Russia» Viktor Tarkhov.Example № 7. From the NTV film «Delo v kepke»: «Practically 5 bln rubles for the construction of a road to a new micro-district, which is being developed by the company of the wife of the mayor of Moscow…For the medical treatment of the invalids of Moscow 105 mln, and for bees – 256 mln rubles». Around 56 bln rubles the powers of Moscow are directing in the year 2010 toward the construction of roads.In all for the construction of roads in Moscow in 2011-2013 will go 140 bln rubles.Example № 7. In one little place they were intending to let three billion rubles go on the construction of the best farm in the world. They allocated the money, they did not build the farm, the procured cows died off. Details here.Example № 8. On the financing of a programme of patriotic upbringing of citizens of Russia in the nearest 5 years it is planned to allocate on the order of 780 mln rubles, of them round 600 mln on account of the funds of the federal budget and around 180 rubles from off-budget sources….Such examples – a multitude. And all of them bear witness to the abominable attitude of the state toward taxpayers’ money. A state not knowing how to control its purse strings can not guarantee the integrity of others’ money either. So potential investors before bringing their capitals into Russia ought to think well beforehand and arm themselves just in case with friendship with a good lawyer.