Moscow Moving to Solve Similar Key Problems

Posted on February 11, 2010

In several moves this last week, the Russian government appeared to have begun to target key areas where they see a need for next to immediate improvement – in finance, education and health care.

On the financial front, privatization and Russia are once again in concert. According to the Moscow Times, President Dmitry Medvedev has ordered the Cabinet to sell off more government stakes in successful companies to private investors over the next two years.

Medvedev is not just thinking of small to mid-sized average companies.  He is thinking large strategic companies.

The list of strategic companies contains such potentially alluring assets as the airline Aeroflot, television company Channel One, telecoms operator Svyazinvest, oil producers Zarubezhneft and Rosneft as well as oil pipeline monopoly Transneft. Cabinet officials last year ruled out selling more stock in Rosneft, however.

It also appears that Moscow has had its share of corruption in its financial industry.

Medvedev also instructed the Cabinet to come up with a proposal to punish more severely those bureaucrats that hamper investment, probably targeting those engaged in corruption. The Kremlin didn’t elaborate on the measure. The Moscow Times

In the area of research and education, he theorized that “[a] comeback of Russian science to world leading positions is hindered by the problem of what he described as ‘the infrastructure of people’s minds,’ rather than financial or material factors….

Asked about a return of ” the brains” earlier drained abroad back to Russia, Medvedev mentioned a woman scholar who had recently returned from the United States to work in Russia. Her experience after her return to Russia was the subject of an improvised conference held on board a plane on Wednesday with the participation of key government figures and members of presidential administration, Medvedev said.

‘In principle, she was pleased with everything – more or less acceptable pay, easily settled housing problems, but only one question arose – the infrastructure in which she was to do her favorite work – science,’ Medvedev said. ‘We have a big problem with that in Russia,’ he admitted. The woman said if she wanted anything in America she simply made an application on the Internet and on the following day or maximum in three-five days things she wanted were brought to her, the president said. ITAR-TASS

In another quick move, Medvedev ordered that the “Cabinet must suggest amendments that would cancel the profit tax for firms that have health care or education as their core business.”  Now here is where Medvedev could save Obama a lot of time with the progressive learning curve. One way to support education and reduce health care costs is to lower some taxes.

Tying it all together, the Russian President has told the government to draft bills that would simplify customs clearance and allow high-tech or research companies to use easier visa procedures.  Think of all of the many complaints from foreign tourists and students about how difficult it is to deal with customs or to get visas for study. Russia is out front of us in this it seems.

What with the deep white snow and a slower pace in DC this past week, our Capitol took on a look straight out of the film “Dr. Zivago.”  President Obama continued to “order” legislation and other items in a manner closer to the former Soviet Union. Washington now reveals itself as Moscow on the Potomac while Moscow appears to be sliding into the look and feel of the US in the ’90s.


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Posted in: Budget, RUSSIA