let the good times roll!

Mon, 28 May 2007 19:56:29 GMT

CHAPTER 3, SECTION 2: The Economy of Modern Russia
Introduction
Of all of the countries in the world, it can easily be said that few have gone through as many sudden, drastic economic changes as Russia. This section will cover the spread of communism, the rise and fall of the Soviet Union, and how the extreme changes in government have effected Russia’s economic standing.

I. Chief Exports and Agriculture
Despite the rough terrain and cold weather of Russia, the agricultural industry has always been a part of its economy, though not a particularly large one. Before the collapse of the Soviet regime, there were over 15,00 state-controlled farms, which were run like factories. The land was divided into collectives of about 30,000 acres, and these collectives were divided into even smaller plots. Each family was assigned to one plot and were expected to grow as many crops as they could, all of which would eventually be bought by the government at a set price. Today, despite attempts to decrease the number of collectively run farms, 90% of farmland is still owned by cooperatives or joint-stock companies. Despite the fact that agriculture is not one of Russia’s strongest economic exports due to poor soil and a short growing season, the annual output of wheat is more than 40 million tons, 70% of which is food-grade. Russia’s second major grain crop is barley, with an average annual output of 16 million tons. Both crops are exported to other countries as livestock feed.
Russia is also rich in natural resources, with valuable mineral deposits in the Ural Mountains, large timber forests in Siberia, and numerous areas containing oil, natural gas, and coal. These resources, however, are in frigid, remote locations, making it difficult to export them inexpensively. In spite of this, oil and natural gas remain Russia’s chief exports, followed by fish; it is a little known fact that Russia has the fourth largest fishing industry in the world. All three of these overshadow Russia’s agricultural production, which is still struggling to achieve an efficient system for the planting, farming, harvesting, and transport of its produce.

II. The Soviet Economy
For more than half a century, Russia’s economy was almost entirely controlled by the state. The three main focuses of the policy instated by Joseph Stalin during the late 1920s were: the eradication of private property and the free market, strong emphasis on industrialism as a means to build military weapons, and a centralized planning system run by the government in Moscow. Unfortunately for the Russian people, the state rarely paid attention to consumer needs, which lead to high princes and low wages. Since there were no privately owned stores or independent professionals such as engineers or doctors, there was no one to provide what the socialist economy did not. In addition, Stalin’s dream of a collective agricultural system was failing; there was a food shortage, and no farmers were able or willing to fight to change this.
Though there were many problems as a result of Stalin’s policies, there were also a handful of successes. By the early 1940s, the Soviet Union produced many of the world’s most advanced artillery, tanks, and other weapons. There were enough people involved in the industrial infrastructure that, even after World War II, projects such as the Baikail-Amur Mainline and additions to the Trans-Siberian Railroad could still be completed. Despite these small victories, when Stalin died in 1953, Soviet leaders knew that Russia’s socialist economy had failed, and was both over-centralized and inefficient when compared with the economies of neighboring countries. In the years following Stalin’s death there were many attempts at reform, all of which were unsuccessful. Nikita Khrushchev’s reforms during the 1950s were rendered ineffective through a combination of his own hastily planned programs and their opposition from the remaining Communist bureaucrats. The still-Soviet central planning system discouraged innovation, and rewarded managers who fulfilled production quotas, regardless of Russia’s economic need for them or their quality. Under the rule of Leonid Brezhnev, corruption reached an all-time high, and many resources were wasted as a result of the neglectant government. 20% of the grain and 40% of the potatoes shipped within Russia spoiled before they reached the consumer, and wages plummeted. During the following decades, conditions improved slightly, though the quality of consumer goods and worker wages did not increase substantially.

III. Russian Economy After the Fall of the Soviet Union
After the fall of the Soviet Union and communism in Russia, the country was in an unstable position, both economically and governmentally. Russia’s size and poverty made it difficult for political leaders to follow the example of other formerly communist countries in their shift to capitalism. In order to move from an economic system based on central planning to a market-based economy, Russia’s goals became macroeconomic stabilization and economic restructuring. Macroeconomic stabilization would hopefully be achieved through new monetary policies whose job was to stabilize prices and exchange rates so that noticeable economic growth could occur. To restructure the economy, banks and private property were re-established, allowing the economy to operate more efficiently than it had during the years of the Soviet regime.
During the early 1990s, many changes were made in regards to the way Russia’s economy was run and controlled. Policies were enstated to reduce government spending, increase state revenues through new taxes, and decrease the price of common consumer goods. Over the following 10 years, inflation rates fluctuated, and concerns were raised over the government’s failure to meet tax revenue goals. However, Russia’s economy stayed more or less consistant, though living conditions and wages were still below the global average.

V. Russian Economy Today
Currently, Russia is enjoying a huge trade surplus as a direct result of high oil prices. In 2005, oil and natural gas made up 60% of Russia’s exports, and helped Russia become the ninth largest economy in the world. By 2009, Russia is expected to rise even higher in the rankings, replacing Germany as the third largest economy in Europe.

VOCAB:
Market economy: A country in which most economic decisions are left up to individual consumers and firms interacting through markets. Contrasts with central planning and non-market economy.
Ruble: Basic currency unit for the Russian monetary system.
Import: Commodities brought in from another country.
Export: To ship a product outside a country or region.
Trade surplus: A positive balance of trade; the number of exports exceed the number of imports.
GDP (Gross Domestic Product): The total value of goods and services produced by a nation.
Bonds: A certificate which is evidence of a debt on which the issuer promises to pay the holder a specified amount of interest for a specified length of time, and to repay the loan on its maturity.

KEY TERMS:

SECTION REVIEW:
1.
2.
3.
4.

FOCUS BOX: The Russian Financial Crisis
Due largely to the global rescession during 1998, which had started with the collapse of Kia Motors in South Korea in 1997 and grown into an all-out Asian financial crisis, Russia’s economy became incredibly unstable. The prices of commodities dropped dramatically, leaving countries whose economies were based firmly around the export of raw materials almost completely dependent on changes in world prices. Russia was hit especially hard, as upwards of 80% of its exports were basic materials such as petroleum, metals, timber, and natural gas. The price of oil also declined, further weakening Russia’s economy. In the years following the crisis, Russia struggled to regain its strong economic standing, but eventually recovered to regain its place in the world market.

Fri, 12 Jan 2007 17:38:14 GMT

Miss me yet?!

Thu, 09 Nov 2006 23:42:15 GMT

poop

Tue, 31 Oct 2006 02:45:13 GMT

orochiko says: (8:42:34 PM)
YOU'RE DOING IT WRONG!!
MAGDA!! says: (8:42:39 PM)
THAT'S WHAT SHE SAID!
orochiko says: (8:42:39 PM)
PFFF
MAGDA!! says: (8:42:41 PM)
AHAHAH
MAGDA!! says: (8:42:42 PM)
HAAHAHA
MAGDA!! says: (8:42:43 PM)
AHAHAH
MAGDA!! says: (8:42:45 PM)
AKLSDJALSD
MAGDA!! says: (8:42:47 PM)
Heh.

Tue, 10 Oct 2006 02:50:10 GMT

I pity da fool who didn't go to no homecomin'!

BY THE WAY I'm bringing more soup/ramen/something warm, delicious and in a thermos than I can eat to lunch tomorrow, so if you'd like some of my soup/ramen/something warm, delicious and in a thermos, come to the music wing ~~AND LET ME STEAL YOUR CHEM ANSWERS PREASE~~. :D

Tue, 26 Sep 2006 15:30:56 GMT

HAPPY BIRTHDAY WILL SMITH! ♥ YOU'LL ALWAYS BE MY FRESH PRINCE!

Thu, 21 Sep 2006 02:49:23 GMT

TOLD YOU THERE'D BE TWINS!

Mon, 18 Sep 2006 09:36:33 GMT

Aw, man. This year's Willy Street Fair was okay, but I ran into MS. LEUSSLER so that makes everything a fajillion times more awesome. And uh uh uh. Funnel cake!?

Wed, 13 Sep 2006 12:01:52 GMT

CHASE'S YO MAMA JOKE FOR THE WIN.

Mon, 04 Sep 2006 15:28:18 GMT

IN LOVING MEMORY OF STEPHEN ROBERT IRWIN

Thu, 31 Aug 2006 16:22:32 GMT

I'M BORED AND VERY HUNGRY

ADOPT ME

Thu, 31 Aug 2006 04:16:22 GMT

01 TAG World History, NO TEACHER UHHH, room 240
02 TAG English 10, Wannebo, room 216
03 Social Psychology, Hill, room 249
04 Spanish III, Gould (I thought she had a brain tumor!?), room 355
05 Geometry for Stupid Kids, Reddy, room 345
06 Chemistry, Rosevear, room 311
07 Symphony Orchestra, Dhoore Becker, room 270

I'm kinda glad I got most of my hard classes after lunch, so I might actually be able to, yanno, pay attention. D: But RAAAAAAAAAAAAAGH GOULD

Wed, 30 Aug 2006 17:40:30 GMT

LATE REGISTRATION IS GONNA BE A PAIN IN THE BUTT

PS I AM A PRETTY PRINCESS

Tue, 22 Aug 2006 04:28:04 GMT

Sat, 19 Aug 2006 22:08:05 GMT

COME SWIMMING TONIGHT, OKAY?!

Fri, 18 Aug 2006 15:06:14 GMT

DANE COOK IS CO-HOSTING THE TEEN CHOICE AWARDS. I CAN DIE HAPPY!

Thu, 17 Aug 2006 20:30:38 GMT

Ahaha.

Thu, 03 Aug 2006 13:18:28 GMT

HERE'S THE DEALIO WITH MILIO'S! On Monday morning (your guys' Sunday night) I leave for Sydney, and from there I go three hours south and spend seven days with the other exchange kids out in the middle of nowhere, learning about leadership and self-confidence and how dangerous Australian wildlife is. Then I fly to LA, then to Milwaukee, get home around 11 in the morning and fall into a coma. I have about a week an' a half after that 'til I go camping up at Madeline Island, so if you wanna drag me downtown you should mos def buy me a $5 all-you-can-eat lunch at the Yummy Buffet.

I'm gonna miss my Aussie soaps. :< I NEED TO KNOW IF SKY'S GONNA TELL STINGRAY ABOUT THE BABY.

Thu, 20 Jul 2006 04:01:22 GMT

THE NEW FLAVOR OF LOVE SEASON STARTS AUGUST 6TH!!

Wed, 12 Jul 2006 07:03:24 GMT

Danielle is an undead monkey.

An undead monkey who's not getting a postcard from Australia.

Tue, 11 Jul 2006 03:48:47 GMT

VIVA ITALIA!

Also, BARBOSA.

Sat, 01 Jul 2006 10:43:41 GMT

I GOT TO PET A BABY KANGAROO TODAY!

Mon, 19 Jun 2006 14:59:09 GMT

1. Think of the first word that comes to mind when you think of me.

2. Run a google image search on that word.

3. Reply to this entry & post one of the pictures from your search, but don't tell me what the word was.

4. Put this in your journal, so I can post a picture for you.

Wed, 14 Jun 2006 18:49:05 GMT

Urine is sterile, so you can, like... drink it.

Tue, 13 Jun 2006 11:04:12 GMT

You Are Bart Simpson

Very misunderstood, most people just dismiss you as "trouble."

Little do they know that you're wise and well accomplished beyond your years.

You will be remembered for: starring in your own TV show and saving the town from a comet

Your life philosophy: "I don't know why I did it, I don't know why I enjoyed it, and I don't know why I'll do it again!"

The Simpsons Personality Test

You Are 8% Obsessive

You're less prone to obsessive thoughts than the rest of the world...
While you do get hung up from time to time, you're excellent at clearing your mind.

How Obsessive Are You?

You Are 48% American

America: You don't love it or want to leave it.
But you wouldn't mind giving it an extreme make over.
On the 4th of July, you'll fly a freak flag instead...
And give Uncle Sam a sucker punch!

How American Are You?

You Are 36% Abnormal

You are at medium risk for being a psychopath. It is somewhat likely that you have no soul.

You are at medium risk for having a borderline personality. It is somewhat likely that you are a chaotic mess.

You are at medium risk for having a narcissistic personality. It is somewhat likely that you are in love with your own reflection.

You are at low risk for having a social phobia. It is unlikely that you feel most comfortable in your mom's basement.

You are at low risk for obsessive compulsive disorder. It is unlikely that you are addicted to hand sanitizer.

How Abnormal Are You?

You Are 46% Selfish

You are quite balanced. You are able to compromise when it's in the best interests of those involved.
But you're no pushover. If something is important to you, you'll get it!

How Selfish Are You?

Your Values Profile

Loyalty:

You value loyalty a fair amount.
You're loyal to your friends... to a point.
But if they cross you, you will reconsider your loyalties.
Staying true to others is important to you, but you also stay true to yourself.

Honesty:

You don't really value honesty.
You do value getting your way, no matter what.
And if a little lying is required to do that, no problem.
A few white lies never hurt anyone (at least, that's what you tell yourself!)

Generosity:

You value generosity highly.
So much so that you often put your own needs last.
There's nothing wrong with having a caring heart...
But you may want to rethink your "open wallet" policy.

Humility:

You value humility a fair amount.
You tend to be an easy going, humble person.
But occasionally your ego takes over.
You have a slight competitive streak - and the need to be the best.

Tolerance:

You value tolerance highly.
Not only do you enjoy the company of those very different from you...
You do all that you can to seek it out interesting and unique friends.
You think there are many truths in life, and you're open to many of them.

The Five Factor Values Test

You Have Low Self Esteem 8% of the Time

Which can be translated to mean, you have high self-esteem and a healthy sense of self worth.
You believe in yourself, and you know how to be the real you. You love yourself, imperfections and all.

How is Your Self Esteem?