Russia’s Kleptocracy

Quartz: The mystery of Russia’s missing wealth shows how Putin retains his power. Oligarch wealth, “wealth that ….. came directly from the country’s reserves—and, indeed, from the pockets of the Russian people.” [my italics]
[Social Policy and Poverty: This seems to be an economic and political system that Trump envies.]
https://qz.com/1330955/russias-missing-wealth/

Written by Gwynn Guilford

Russia is a nuclear power. But an economic power it is not. Last year, the country’s GDP totaled around $1.6 trillion, less than that of the state of Texas. Nor is its wealth growing: Russia’s GDP in 2017 was smaller than it was in 2013, adjusting for price changes.

And yet there’s no question of Russian president Vladimir Putin’s international influence. Witness his ability to hack bigger, richer countries’ democratic elections, or, as this week’s Helsinki summithighlighted, to cow Donald Trump. The Kremlin’s knack for punching above its weight when it comes to geopolitics is a reminder that wealth sometimes matter less than what you do with it.

Or, more precisely, to whom you give it. Oligarchs are an essential part of Putin’s power apparatus. Oligarchs are an essential partof Putin’s power apparatus. And as a recent working paper (pdf) by economists Thomas Piketty, Gabriel Zucman, and Filip Novokmet reveals, the wealth that won their fealty came directly from the country’s reserves—and, indeed, from the pockets of the Russian people. [my italics]

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