“Russia Went to War to Dispose of $640 Billion”: Oleg Cheslavsky on the Kremlin’s Budget Crisis

Historian and analyst Oleg Cheslavsky talks to Yuri Romanenko about Russia’s war economy, world-systems analysis, the cynicism of the Kremlin elite, and why the West has no interest in dismantling this system

Yuri Romanenko: Hello everyone. I became interested in Oleg through Vitalik Kulyak. I read several of his articles, and recently there was one about Russia’s budget crisis. I immediately told Vitaliy: “That’s it, bring him to me. I really like everything.”

It turns out Oleg is also a fan of world-systems analysis, like me. He has a brand new book called “The Russian Myth” — an attempt to apply world-systems analysis to the post-Soviet space. I know few such attempts: Kagarlitsky wrote “The Peripheral Empire,” Derluguian teaches macrosociology in the States. And that’s basically it. I haven’t written my outstanding works yet, but Oleg already has, he got ahead of me. So with a sense of healthy envy, I was internally pleased, because I believe we lack such deep works.

World-systems analysis is the highest level of analysis in my understanding, because it moves away from the optics of mini-processes at the local level and allows you to look at everything through the lens of a large scale. The book can already be purchased on Rozetka. We’ll do a separate presentation.

And the second book — “2034.” This is, I understand, a parody of Orwell, but with our reality?

Oleg Cheslavsky: I won’t deny that the title contains the answer to why all this was done. It’s a continuation of the dictatorship that Orwell described. Everything is basically the same.

Yuri Romanenko: Great. Then let’s begin. So, we’ll also look at Russia’s budget process through the lens of macrosociology and world-systems analysis?

“The Economy of Losses”

Oleg Cheslavsky: Yes. Arrighi opened my eyes, made me look at many processes differently. To see that the world economy has actually become an economy of losses. Previously, any economic system was built on profit. Today the system shows that you can earn more from losses.

I’m confident and I prove to everyone: Russia went to war to dispose of $640 billion that it had accumulated. It’s disposing of them very successfully and continues to do so year after year, accelerating the budget process toward militarization. War is the perfect scheme for disposing of money. It’s simply impossible to come up with anything better.

Yuri Romanenko: But why dispose of them? After all, you can never have too much money.

Oleg Cheslavsky: It’s a huge problem, especially for Russia. When there’s a lot of money, logically, it should be returned to the budget. People start living better, they develop needs, they start opening their eyes: “Wait, our government is stealing money. Wait, our tsar is probably a bit wrong. We could live better.”

The very idea is to bleed the country dry by withdrawing this money under any pretext, not returning it to the country. They sell huge amounts of oil and gas. By returning this money to the country, they could develop the economy or invest in the social sphere, but they categorically don’t need this.

Yuri Romanenko: Let me give an example to develop this thesis. About $1.2–1.3 trillion was spent on the modernization of the UAE. Investments in China amounted to about $2 trillion over 40-plus years. The result is obvious. And Russia disposed of, by some estimates, from several hundred billion to $1.2–1.3 trillion, maybe more. Enormous capital that could have been spent on modernization simply evaporates.

Oleg Cheslavsky: They don’t want to do this. Today, Russia is the perfect economy from the perspective of world-systems analysis. They’ve reduced the operating costs of their colonial territories to zero. The colony requires no investment, it just functions. People go to work for pittance handouts. Social infrastructure is completely absent and continues to deteriorate. There are no roads. In gold-bearing regions, there’s nothing at all.

From a capitalist approach, this is the harshest, most cynical system of sucking money out. We take everything, we give nothing back. This is exactly what the budget from 2025 to 2028, which Putin signed, is built on.

Shoigu Was Fired for the Money

Yuri Romanenko: What else is telling?

Oleg Cheslavsky: This thesis is confirmed by the fact that in 2024, Putin, with great pain in his heart, fired Shoigu. He handed over his most profitable business to a person with an economics education. They understood that big money requires a much smarter and more proper approach. Shoigu was a military man through and through — whatever kind of person he was, he couldn’t manage hundreds of billions. He was fired.

Has the corruption situation changed there? No, it hasn’t. It simply became more profitable for the current ruling power.

War as a Failed Blitzkrieg

Yuri Romanenko: War as an economic project for capital disposal — what’s at the end? What were they supposed to get at the end?

Oleg Cheslavsky: The situation is complicated. Initially, the war as it was conceived — Putin’s lightning war — was supposed to bring him, besides the ability to write off those $640 billion as expenses (missiles, tanks, etc.), also Ukraine. Ukraine’s value — roughly speaking, $500 billion — he would return them to the country. That was the main plan.

But it didn’t work out. The war started sucking money. About a year or two was spent on flipping the economy from the system they existed in to make it completely militarized. They experimented for a long time so that all the right flows through the military budget would come out again in big plus.

I believe 2025 is the indicator. They’re finally spending 40% of the budget on war quite comfortably. And these 40% are actually eating away at the social sphere, which is already destroyed.

Also very important — this is straight from world-systems classics — they’ve finally started forming a debt pit for the state thanks to the war. By 2028, they’ll already be giving about 10% of the budget to cover the debt that arose thanks to the war.

Yuri Romanenko: What’s the problem with just freezing this money, spending it on anything — let the rails turn in the snow, like the Soviets? Why specifically on war?

War and Pathos: A Self-Reproducing Mechanism

Yuri Romanenko: I think we also need to connect war with pathos here. The main vector of Russian state policy efforts is directed at pathos, where war is the key element. Pathos is the foundation of the mythology of greatness, which conditions expansion. “We carry out expansion somewhere to confirm our greatness, which is based on defending against all enemies.”

Throughout history, Russia heroically defeated enemies and as a result occupied 1/6 of the world’s land. And here, it would seem, it’s time to stop, but the machine is already running. It’s a self-reproducing mechanism. War is needed for pathos. Pathos serves war. They constantly complement each other.

Oleg Cheslavsky: We return to the fact that the Russian state is an illusion. That’s why I called the book not “Russian World” but “Russian Myth.” They invest huge money in mythology, but not in the world. In virtual value, in “victory cult,” in another mythical hero — but not in reality. Not in building roads, healthcare, schools. They won’t invest in real things that will give real benefits and really develop the state. They don’t need this. Categorically don’t need it. It’s forbidden.

The Renaissance Lesson

Oleg Cheslavsky: Actually, this system could have been built not on war. That’s true. We have a very good example from history — the Renaissance. Everyone thinks for some reason that the Renaissance arose out of nowhere. That’s a lie.

Our proto-states — Venice and Genoa — faced a colossal problem, the same as Russia. When Constantinople fell, they accumulated a huge amount of money. Where to spend it? On war — a good option, there’ll be even more. But what did they do? They spent it on science, art, architecture, development.

What we see in Italy today is “thank you Turkey for capturing Constantinople.” They destroyed the most powerful trade route. And because the money accumulated, the Italians were able to turn it into what became the Renaissance. Essentially, a colossal leap in human thought.

Core, Semi-Periphery, Periphery

Yuri Romanenko: World-systems theory says that there’s a core, there’s a semi-periphery, there’s a periphery. The core is those countries with advanced organization that create advanced technologies, advanced armies, advanced science. Innovations allow you to extract huge margins from technological superiority.

When an innovation is launched, a monopoly position allows you to skim the cream. Whoever is most innovative, most progressive — is the hegemon in the core of the world-system.

Wallerstein and Arrighi developed the concept of hegemon. In the world system, the hegemon isn’t eternal, they constantly change. The next hegemon creates its own organizational model with its own innovations, technologies, military power, and opportunities for expansion.

Each hegemon goes through several stages. In the first stage, capital goes into productive forces, because it’s profitable to produce something within new technologies, to receive super-profits. Like Venice produced high value-added products — luxury items, furniture, galleys. It’s important to have a monopoly and super-profit. As soon as super-profit decreases — they leave this market immediately.

Then a struggle occurs between the old hegemon and the one gaining strength. The old hegemon’s technological base becomes obsolete, margins fall, but large capital accumulates. The transition from productive capital to speculative, to the financial sphere, is called a signal crisis. The US went through its signal crisis in the 1970s.

After the signal crisis, developing production within the old technological paradigm is unprofitable because margins are lower than in the sphere of financial speculation. That’s why the flourishing of art during the Renaissance and in the Netherlands in the 17th century is directly connected to these transition moments. “Tulipmania” — when tulip bulbs were bought for crazy money — was directly connected to this. The same thing now — art objects cost crazy money. Or cryptocurrencies — also a very nice, competent disposal.

Oleg Cheslavsky: People who understand how big money is really made realized: by returning money to society, they create competition for themselves, they decrease the value of the money they’ve accumulated. It’s easier for them to create a virtual pseudo-value that costs nothing. Again — these bananas for $6 million and all the rest.

Russia in this regard has a different system, a different approach. I don’t want to say that Russia is some separate player that plays outside the equation or builds its own line. They’re so dependent on the general ecosystem that it’s hard to imagine how they would work separately. Another question is that the system itself is already dependent on them. They’re fully embedded in it, they’re part of it.

But from the point of view of maximum cynicism — this is the perfect system for exploitation. What they’ve built, no one will destroy. With all due respect to democratic values, liberal, American — no one will do anything with Russia. They’re trying to keep it exactly in the state it’s in now. They’ll make every effort to keep Russia, because this is the perfect system for exploiting colonies, and at the same time they also perform useful power functions necessary to keep China and Europe in check.

Russia as a Tool in the Global Game

Oleg Cheslavsky: This is an amazing approach altogether. They returned Russia to this market. The African operations — how successfully they went. Both Chinese and American capital participated there. We see how France simply left Africa. Thanks to whom? The Russians. France lost five countries that were in its orbit.

And China too — they entered Africa very well, but they didn’t understand who the Russians are. They absolutely don’t know how to work with Russians. I translate French public pages, Twitter, and I see how they react. They noticed that the Chinese really pushed out the media field in Africa, prepared the media campaign for the Russians very well. But the Russians cheated them a bit in the end. Those enterprises that were supposed to go under Chinese capital, they kept for themselves. There was a problem with this.

I understand that in many ways the expansion in Africa therefore wound down — the Russians don’t know how to work honestly. I got the impression: they did all the dirty work, but decided to keep part for themselves that wasn’t supposed to be theirs according to the agreement.

Budget Crisis in Numbers

Yuri Romanenko: Russia’s budget crisis — how does it manifest in numbers?

Oleg Cheslavsky: The budget crisis is connected with the formation of the budget itself. There should be industrial productive forces from which the tax base comes. And what are they going to build the tax base from, excuse me, if 40% of the money is actually withdrawn into nothing? Tanks, planes, expendable materials for war, maintaining armies. There’s no tax base as such.

They explain that the budget is social. Like, the money wasn’t stolen from industry, but taken from the social base — it would have been distributed to people anyway. But if this money had been distributed to people, it would have returned to the economy in the form of taxes. But they don’t return it.

The only way to compensate for the 25% they transferred from the social sphere to the defense sector is through taxing the Russians themselves. They’ll look for ways to get even more taxes to compensate for this growing crisis.

Plus their traditional endless source of income — gas and oil — is selling poorly now. And it will get worse.

“Russia Itself Is a Valuable Resource for the Whole World”

Yuri Romanenko: If debts are growing, the country is going bankrupt — what’s at the end?

Oleg Cheslavsky: The main money flows are connected with supplying resources abroad. This base isn’t going anywhere. They were supplied abroad, and they’ll continue to be supplied. One way or another, they’ll find buyers. Despite all the sanctions, they don’t interfere with sales. China will find ways to buy, India will find ways. We understand perfectly well: if someone wanted to stop these sales, everything would have ended much faster. But they’re not being stopped, no one’s trying to stop them.

Besides, they view people as a resource too. It’s a great resource that has proved itself during the war. This resource can really be used to scare Europe now. This amazing resource allowed Trump to raise NATO costs to 5% per side.

We just aren’t trying to see in this scheme “money — commodity — money.” We need to look from a different angle. Russia itself is a valuable resource for the whole world. It can be sold just in a slightly different form. Threat, crisis. Want crises? Let us sell you an excellent crisis. Where do you want to start it? Putin is already departing with his army of “crisis managers.” Why not?

Those arrested billions are a subject of bargaining. It’s no secret that the Russians constantly offer these billions as supposedly an investment in the US economy. And nobody refuses this idea: “Very good idea, let’s go, we agree to receive them.”

Where else does Trump earn? Gas, oil — everything is now effectively in US hands thanks to the fact that the Russians created a problem for themselves with sales.

One Banking Sphere

Yuri Romanenko: Many don’t understand that there’s no point in viewing Russia, Brazil, and other countries as separate subjects without understanding all the interconnections. Similarly, for example, the banking sphere of Europe and the US — is it one banking sphere or different? It’s one banking sphere. They’re so interconnected that during the 2008 banking crisis, Americans poured trillions of dollars into supporting European banks as part of quantitative easing. Because if they had collapsed — there was a lot of American capital there — it would have simply destroyed the American system.

That’s why since 2008 they synchronized crisis resolution in both the US and EU. Same with Russia. When Trump talks about economic interests — it’s really true. They state that they’re interested in $2 trillion of commodity rent that they want to extract.

And in Russia, this question isn’t raised. It turns out that the commodity rent on which Russia constantly exists… If they invested in processing, in developing deep processing, they would add value — this would give even more opportunities for modernization.

Oleg Cheslavsky: I compared Russia to fascist Germany. At first it was funny — like, Hitler doesn’t have oil. Then I think: no, they practically have nothing that could even slightly compare to Germany. They don’t have Germany’s industrial potential. Germany was the world’s leading industrial power when it entered the war. It really had a problem with oil.

Russia has this problem solved. But only in the third-fourth year of war could they more or less modernize their approach to war, to somehow conduct some decent offensive actions. Before that, there was none of this.

The Korean War and Preserving Hegemony

Oleg Cheslavsky: I want to note: when we read Arrighi, there’s the signal crisis of the US in the 1970s, which was supposed to lead to the end of the cycle — it didn’t happen, didn’t lead to this. Everyone says what happened: Americans say — happiness happened, the Korean War. Thank you Russians. Thanks to the Korean crisis, they were able to revive economic potential again.

Yuri Romanenko: No, the US signal crisis passed in the 1970s. They were still at their peak then. But Korea — that was the first wake-up call when they understood that war is the perfect crisis that revives the economy.

Arrighi has a situation where he explains that the next country that was supposed to become the capital of capital should have been Tokyo. He said everything was going to Japan. Then China — he wrote a separate work, his last before his death in 2009, “Adam Smith in Beijing.” Great work.

Oleg Cheslavsky: I liked that it didn’t happen with Japan, because they adopted the idea of not working in the field that existed before. They understood that there’s also an economy built on crises. Crisis is an excellent model if you monopolize it. Like, for example, COVID — when you can earn a lot.

Yuri Romanenko: Basically, Arrighi still turned out to be right. Starting from the 1970s, the US began actively exporting financial capital, which went to China, to Latin America, to Mexico, and so on. It had much higher margins than productive capital that remained in the US. Deindustrialization in the US in the 1980s–90s was directly connected to this.

What Trump is trying to do now — reindustrialization on a new technological base with artificial intelligence, with new energy — this is precisely the opportunity to preserve hegemony for the first time in history. Because the previous hegemon always lost it.

Back in 2008, when I did the work “Global Super-Crisis and Risks for Ukraine,” I said that for the first time in history, the US, due to its island position and the ability to create controlled global crises, has a chance to preserve hegemony through exporting chaos to Eurasia and launching reindustrialization on a new technological base.

Trump in this regard isn’t random. And those tech giants behind him — Thiel, Musk, and all the others — they fully understand the strategic interests in all this.

America’s Penalty Lap

Oleg Cheslavsky: I think Trump somewhat understood the crisis that COVID showed: state autonomy is necessary for its continued existence. If a state can’t provide for itself everything it needs or will depend on logistics chains around the world — that’s a big problem. When all countries closed, shut their borders — that was proof of this theory.

I think it would be interesting to consider the current situation through the fact that the US didn’t just preserve hegemon status — they went on a penalty lap. My idea is that they made some big mistake in their development. I can’t pinpoint it exactly yet. But all these attempts, the system’s imbalance, and generally what we’re observing in the world — is that they, trying to stay on the hegemon’s throne, don’t yet fully understand what the next system should look like. They’re forming it, and this system is quite crisis-prone, very harshly crisis-prone.

Yuri Romanenko: Their logic is quite understandable. Encapsulate in the Western Hemisphere, concentrate all resources by reducing security costs, support the imperial infrastructure less in the form of hundreds of naval bases around the world. Concentrate capital, throw it into the transition during the period of isolationism, restructure while playing on chaos in Eurasia.

While China, Russia, India, Gulf countries, Turkey, Europe are figuring out their interests, fighting in regions like Central Asia, Ukraine, Eastern Europe, South Asia, Southeast Asia — thus resolve the issue of “freezing” the current status for everyone, so that no one breaks ahead (for example, China) while they’re restructuring.

Then, after they’ve restructured within the new Monroe Doctrine (Venezuela, for example, is within this scheme), move to returning to Eurasia and forming a global agenda where they’ll already speak from different positions. Not from the position of a slipping technological paradigm.

Because when you come to the States and come to China — you see how much the infrastructure differs, not in favor of the States. I remember the diesel stench at Washington airport that greeted me in 2015. And compare with the splendor at Beijing, Shanghai, Guangzhou, Nanjing airports. Simply night and day. In infrastructure, the Chinese were already outpacing them at monstrous rates back then.

The Chinese Model

Oleg Cheslavsky: What we see is the approach of the Chinese model, which differs from the global model. The money they have, they still reinvest in the country, return it to the country. They don’t have huge offshore accounts abroad, like in America, in Russia.

Yuri Romanenko: Actually, they do. Actually, capital flight after the 20th Congress, when Xi Jinping extended his power, was huge. Within 3 months, 20% of billionaires and millionaires fled after it became clear that Xi was done with this.

Oleg Cheslavsky: Still, we see that more money remains in their country. They somehow managed to preserve some part of the money supply that everyone else is losing catastrophically. Russia loses the most, I believe. If we kept at least 10% of the money that could have been kept, everything would be much better.

I don’t know, sometimes I get the impression that the level of cynicism of those people who dictate this country’s policy — it’s simply off the charts. It’s hard to imagine who they really could be. Simply calling them “locals” is very difficult. It’s a terrible problem.

And how to explain this to the Russians themselves — I can hardly imagine. I can’t imagine, because explaining through “you could live more comfortably” — I think that’s not quite the right approach.

The Debt Trap in Numbers

Yuri Romanenko: Your article on “Spilne” has interesting statistics. Total funding for education, healthcare, social policy — everything concerning people’s lives — fell from 47% to 44% of the total budget. At the same time, the budget itself grew by $118 billion. In simple words: the entire budget growth was completely absorbed by defense spending and debt servicing.

Of these additional $118 billion — nothing went to improving Russians’ lives.

A separate catastrophe is the explosive growth in government debt servicing costs. In 2023 — $15 billion, in 2026 — $39 billion, growth of 260%. In 2028, this item will reach $49 billion and will eat up practically 10% of the budget.

Oleg Cheslavsky: They built a debt trap for themselves. To actually withdraw this money from the economy for another reason. Actually, for the country, this isn’t a problem. It’s a problem for people. They’re now simply bleeding the country dry in terms of the social sphere. Not returning money to the country.

They invented this, well, essentially — a paradox. They can’t borrow their own money from themselves, but they borrow it and give it back to themselves. And they give it to those people who run this country. These 10% they’ll simply cleanly and nicely take for themselves as debt servicing.

The country Russia already belongs to them, and it will also owe them. Not only does it belong to them — it will also owe them. I believe the cynicism is off the charts.

15–20 Years of War

Yuri Romanenko: More interesting statistics. Under the three-year plan, they plan to spend $129–136 billion annually on defense with a fixed share of 29–30% of the budget. This is the key signal: the Kremlin is counting on a long confrontation and is strengthening defense as a systemic priority for years ahead.

At the same time, social policy remains at the current level in nominal terms — about $70–75 billion. And in real terms — less, because it faces inflation. Healthcare and education will receive symbolic indexations that won’t even compensate for the official increase in the cost of living.

Oleg Cheslavsky: Again: they’re completely withdrawing money from the social sphere. Showing that they can reduce it even more. Today it’s already in terrible condition, and people practically don’t grumble. They’re testing the system: we cut every day a little piece, a percent from the social sphere — and nothing happens. There’s no conflict with the state. Nobody says Putin is a bad person, nobody goes out into the streets. Everything’s fine.

The situation is terrible, and the people themselves who are in it do nothing to change anything.

I’m also preparing material on the defense industry now. I understand the situation: they’ve built a completely closed family business on war. A huge business. They can now explain the injection of social money into it simply as necessity: “Otherwise we’ll be ruined, captured, we need to save ourselves.”

And nobody, by the way, for some reason asks themselves: on average, this budget is 15–20 years. If they’re planning to manufacture for the next 15–20 years everything they’re building now… The development of all this military machinery — it’s not a three-year horizon. Our equipment will have to work for 15–20 years.

Where will it deliver those shells? Has anyone asked this question: who is Russia going to fight for the next 15–20 years?

Do Russians Aspire to Comfort?

Yuri Romanenko: One viewer writes: “Russia’s enemy is the comfortable life of the population. The main example is the West and Europe, whose population is so comfortable, democratic, that they’re very vulnerable to attack. That’s why Russia is trying with all its might to prevent the penetration of Western comfort culture into the country, because then it will simply fall apart — either from external threats from China or from internal ones.”

Oleg Cheslavsky: Good thought, but I wouldn’t say that they in the 90s and 2000s aspired to comfort. They don’t understand at all. I always clearly showed when I went to Moscow: “Here’s where Ukraine ends, here’s where Russia begins.” They asked me: “How do you do that?” I said: “Look at the houses. A Ukrainian’s house is everything around: vegetable gardens, flowers, something’s done. Russia begins — a field, an empty field.” That’s a fact.

They don’t have the concept of comfort as such. They don’t arrange the land they live on. I got the impression that this is like the first towns in “Zalesye” — hunting camps. They came to the camp, got furs, took them to sell, moved on.

There’s no city, no main generator of city life — market culture. The market became the place where culture is formed. The bigger the market — the bigger the cultural object. Kyiv is a multicultural city because of the big market. It attracted — they name some crazy numbers of churches there, almost 400 churches. I think that’s a slightly inflated figure, but Kyiv had a huge market. Actually, culture came here following the caravan.

They have a culturally embedded framework of survival, not comfort.

The Culture of Over-Consumption

Yuri Romanenko: I wanted to say: look, over-consumption in modern Russia actually exists. Moreover, this culture is directly connected to the problems of the Soviet Union, when the Soviet person in queues and under conditions of scarcity formed a specific attitude toward consumed objects, which became a kind of fetish.

For example, a car. Whether you have a car or not — that’s having a certain status. Same with a Yugoslav wall unit, a good refrigerator, jeans that cost 100 rubles.

When in the 90s the market opened and goods flooded in — a significant part of Russian capital, which was generated through the sale of energy resources, was disposed of through over-consumption. It was gaining momentum, but gradually, since this is a contagion — it started having a corrupting effect.

It’s probably hard to deny that big Russian cities live at a good level. Moscow, St. Petersburg — this is cosmos compared to the provinces.

Oleg Cheslavsky: No matter how many times I’ve been to Moscow, how many times I’ve been to St. Petersburg — in St. Petersburg I was first told: “Excuse me, Muscovites aren’t Russians. Leave us alone. These are people with a completely different thinking format. They’re not Russians.”

In Moscow — there’s a culture of over-consumption, completely different approaches, completely different salaries and money. But this isn’t Russia, this isn’t 140 million people. The provinces that exist — they never had this cult.

I’m telling you honestly: let’s go, drive 150–200–300 km from Moscow — there’s no over-consumption there. There’s actually a paradise of Chinese goods, cheapness, problems of their own nature — alcoholism in colossal proportions.

I don’t know, honestly, that Russians aspire to comfort. I’m not inclined to share this opinion.

Yuri Romanenko: I think you’re overlooking something. For example, Rostov, the whole southern part of Russia — Novorossiysk, Krasnodar, Rostov — they’ve grown very seriously over the last 20 years. Because agriculture was actively developing, and oil money, and transit, and production.

They have such regions — Yekaterinburg, Novosibirsk, Moscow-St. Petersburg, of course — that have grown seriously. If you look at the level of consumption in Russia — this applies to the whole world, actually — Russians have never lived as well as now. Same with Poles, Chinese, many countries that have carried out modernization over the last 40 years. Turkey has never lived as well as now.

Oleg Cheslavsky: Turkey is now in a tragic situation, as far as I was told. A very bad situation, probably even worse than in Russia.

Yuri Romanenko: Look, economic downturns, inflation — all that exists. But Turkey has never lived as well as now. I just traveled back and forth across Turkey — from the undeveloped East to Istanbul, Izmir, Ankara, and other centers. This is simply a huge industrialized country with a very clear policy aimed at development. Despite all the problems, Erdogan’s authoritarianism, corruption in the Justice and Development Party — it clearly has a huge modernization leap. From the point of view of modernization, Turkey is in a very good position.

Oleg Cheslavsky: I absolutely agree with you. But from the point of view of ordinary citizens I had the opportunity to talk with, they explain that their situation is now much worse than before. Unhappy with inflation, unhappy with the state of affairs.

And at the same time, the modernization leap somehow accumulates some capital for it — from the same tax base that exists in Russia. Erdogan finds this money, finds the opportunity to reinvest it in enterprises that in theory, in the future, should give a big leap. They have their own electric train, amazing development with Bayraktars — they’re walking ahead of the whole planet. I understand this perfectly. But at the bottom, the situation remains quite bad.

As for Russia — I don’t argue that there are some successes in spots, locally. We now see in the military sphere what’s happening: they’ve slowly, confidently started outpacing us. In both quality and quantity of production, they’re actually outpacing us.

I believe this is largely due to Belousov, who was actually put on the flow and explained: “From now on, we’re not stealing everything. Let’s redirect part of the money that used to go nowhere to the war.” I believe they really got a big plus from this. For us, it’s a minus.

Trends

Yuri Romanenko: One viewer writes: “Gentlemen, measure cities not in units but in population. Add up the Moscow, St. Petersburg, Kuban, Kazan agglomeration populations and others. Will much population remain outside?”

Not much, because among 86 federal subjects, only 12, well, 15 maximum, earn enough to have surplus budgets. All the rest are on subsidies. So it’s not surprising that there are points where capital concentrates — primarily Moscow and other agglomerations — and they concentrate population.

This is a feature of peripheral and semi-peripheral states, where the capital, as a rule, gains a lot.

Oleg Cheslavsky: It’s a very wrong approach to call Russia’s colonies “regions.” It’s so stupid and wrong. When we start calling them that, we understand that there’s Moscow — roughly speaking, the metropolis that collects all the money, actually collects people who understand where money is made — and colonies. Colonies can’t afford to develop. They don’t have such a goal.

Today, by the way, there was interesting news: they canceled the construction of a 2,000 km railway that was supposed to go through Altai and reach the Chinese border. “Kyryumchi” there. They were supposed to invest 50 trillion rubles, but calculated that it’s not worthwhile — there are no resources, they won’t pull this project.

They didn’t find a mathematical model that would allow them to profit from it. For example, the perfect plan showing where Russia should and how Russia develops — is the tunnel that Dmitriev proposed to build under the Bering Strait. This is literally the most necessary, advanced thing Russia should do!

This is an opportunity to sink huge billions. Moreover, you can’t drive up to this tunnel, can’t approach it, and there’s no one to go — there’s simply no population in Alaska. But the idea itself is brilliant: let’s spend another 1 trillion rubles on a very useful project.

On Trump and Helping the US Economy

Yuri Romanenko: There’s a question: “Can Trump help the US economy?”

Oleg Cheslavsky: He’s helping the US economy at Russia’s expense. I’m telling you: he used the war very well so that the US started receiving more military orders. He explained: “Guys, free use of the NATO regime is over for you. Now you have to pay, and you’ll pay us, because we’ll protect you for money. You should buy more missiles from us, order more planes, and so on.” Russia is already helping the US earn.

Yuri Romanenko: How does the guest feel about Professor Lipsits’ analytics?

Oleg Cheslavsky: I feel good about it, I read it, sometimes I take something. It’s just that when I form an analytical slice, I collect about 30–40 sources and then analyze this data together. I never have one source. Honestly, I’m subscribed to probably 200 of the best Telegram channels, which consume a huge amount of my time. But nevertheless, I can say that I see the world a bit wider than many others.

Yuri Romanenko: Friends, let’s wrap up. We’ll continue. I once again recommend buying “The Russian Myth” — a book based on world-systems analysis about Russia’s history through the lens of world-systems analysis. I’ll gladly read it myself — I didn’t know about its existence yet, the author brought it today. So I’ll post on Telegram, I’ll advertise it — just out of sympathy. Let people get acquainted with interesting ideas.

I think we’ll do a separate broadcast, maybe next week. I’ll bring Arrighi, see what’s with Kagarlitsky, Wallerstein, reread — and we’ll try to look at the processes that were in this space through the lens of world-systems analysis.

Like the broadcast. Thank you to everyone who watched and who actively participated.

Oleg Cheslavsky’s book “The Russian Myth” can be purchased on Rozetka.