"Life Got..." (1995 poster)

Reforms in this area have brought a measure of stability to the population – for example, Putins promise to pay wages and pensions have come into effect, providing people with income and allowing some progression back towards market based economics.  Rutland highlights the fact that living standards have doubled under the Putin government (Rutland: 2008, p1051).  Yet the stability of the Russian economy in the 21st century has been attributed to the last major market crash in 1998, which brought the artificially high ruble down to a level more suited to its purchasing power compared with other international currencies.  Additionally this economic prosperity can be, once again, seen to have its roots in the energy boom rather than meaningful economic reform; as noted earlier, this is attributable to the vulnerability of resource based economies to commodity price fluctuations.

Whether the current trend of falling energy prices decisively impacts on people’s standards of living remains to be seen.  However overall the reduction of the number of Russians living in poverty from 33% to 20% of the population indicates that for some people at least, quality of life has increased.  This has resulted from a relatively low budgetary allowance for social spending; the focus of the Putin government has been on repayment of foreign debt, compared to social spending at a mere 3% of GDP in 2006; while monetary expenditure has increased from $4 to $40 billion, this represented a slight fall in percentage related to GDP by 2007 (Rutland; 2008, p1066).

In conclusion, Putin’s reforms have demonstrated that despite the attempts to bring down the system of crony capitalism, the systemic flaws still present in modern Russia as well as the sometimes haphazard and contradictory policies pursued have hampered development.  This can be seen to have its roots in the collapse of the inefficient and wasteful Soviet economy as well as the tremendous blow through shock liberalisation – to effect reforms that would transform Russian society and the economy will likely take years.  This is not to say that all of the reforms have failed utterly -  Putin’s attempts to reassert state authority have proved wildly successful, and have obtained strong public support despite criticism of the perceived authoritarianism now in Russian politics.  The executive has wide ranging powers, which although was initiated by Yel’tsin in his constitutional conflict with the state Duma in 1993 has been expanded under Putin to include the appointment of regional governors as well as the creation of the administrative districts in order to bring strong control to bear on separatist regions.  In tandem the restoration of effective taxation and the clamping down on oligarch excesses harmful to the state, both on the national and regional scale, have assisted in starting domestic economic development and beginning to encouraging foreign investment along with a strengthened judicial system. 

Furthermore the assumption of key sectors of the economy, notably the energy sector, have placed the state in strong control of the development of these sectors as well as strengthening their capacity to function effectively according to national interests during a critical time for Russian socio-economic reconstruction. Yet this should be placed in the wider context of Russian society and economics as a whole.  Perception of the Russian state still indicates widespread corruption, and the economic boom based on the energy sector has been seen to be a greater factor in bringing about improvement in the Russian economic and social spheres than the reforms initiated at the centre.  Furthermore the oligarchs themselves remain relatively intact as a class.  Therefore it can be said that the reforms are a start in reforming Russia, where the separation of business and politics and the corresponding reduction of corruption and increase in living conditions has further still to go to better dismantle crony capitalism.