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"Today, the government proclaims the second stage of radical economic reform ... in reality, the `contents' of this second stage -- reform of housing and utilities, education, science and enterprises -- simply boils down to a reduction of state spending to subsidize these sectors.... Thus, if we drop the pseudo- scientific window-dressing, the main idea of the `second stage of reform' is to dismantle the state's responsibility for the condition of the economy and society....
"Judging by the actual priorities in the government's budget policy, its leaders locate the most important aspect of their activity, as servicing the state's loans, which were assumed at superhigh interest rates, and which, respecting the terms under which they are serviced, border on legalized embezzlement of state property.... (in this year's budget) the only area that was not cut, was spending to service the state debt; it even increased, attaining the level of over one-fourth of all Federal Budget spending... the Russian government is not an institution of a democratic country, with a market economy. It is a colonial administration, chiefly occupied with extracting taxes and selling off state property in the interest of its creditors, for whose interests... the entire machinery of state is working.
"This is the manner in which many pseudo-state systems are constructed in the underdeveloped countries of Africa; the local ruling oligarchy lives on foreign loans, which are serviced by the allocation of the national income for this purpose, and the transfer to foreign capital, of control over foreign resources.... the Russian government in no way differs from the puppet regimes in underdeveloped countries that are really colonial dependencies...."
The new, second, stage of the reform will destroy the basic institutions of Russian society, along the following basic lines, which Glazyev listed:
Russia has already lost one half of its industrial capacity as a result of the "reforms" imposed from the West, and it is these policies imposed on Russia, which have created the massive corruption there. "To put it crudely, Russia has `given blood' for the past five years, it has been a lead donor for the economies of the U.S. and other members of the Group of Seven. Hundreds of billions of dollars have been taken out of Russia, for their gain, as well as over half a million skilled personnel, whose intellectual capital is valued at hundreds of billions of dollars..."
Under the sub-heading "genocide", Glazyev elaborated further on what has happened to Russia: "The results of the first six years of colonization of Russia are horrific: the devaluation of personal savings by hundreds of billions of dollars; the two-fold collapse of production, a budget crisis that has cut the current income of the overwhelming majority of citizens in half, the explosive growth of unemployment, crime, socially spread diseases, and the shut-down of social guarantees. By the basic socioe-economic indicators, Russia has gone far below the critical level, and is in a headlong dive toward the level of the least developed countries."
"In not a single productive sector of the economy has economic growth been achieved." What has occurred is a bloating of the speculative sector, where the banking system alone now accounts for up to 20% of Russian GDP; "Ultimately, the source of the incomes of the nouveaux riches has been the reduction of the income and wealth of others."
Then, Glazyev focussed on the genocidal human toll; 10% of the population have been turned into outright social outcasts, "deprived of all rights to income, property or social guarantees"; "over 20% of the population lives in deep poverty, having incomes below the subsistence level.... in all, almost two thirds of the population live in poverty."
Glazyev appealed to his Russian countrymen, and other countries, to re-establish soveriegn state policies, where the government controls the strategic realms of the economy; to adopt urgently protectionist measures to protect domestic industry, and to provide for state generation of credit for projects in infrastructure, industrial and agricultural modernization and production. "Following these principles, while unfailingly defending national interests in economic policy, in combination with an aggressive structural and scientific and technological policy, adoption of special measures to restore the destroyed connection between savings and investments, demand and supply, labor and income, will make it possible to anticipate the rapid restoration of economic growth of not less than 5 to 7% per annum. But this requires the formation of a government of national confidence, which pursues the national interests and resists pressure from abroad, and it requires the removal of the rule of the comprador oligarchy."
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