Russia is the most unequal major country in the world: Study

Katy Barnato    CNBC

Russia is the most unequal major economy in the world, with almost two-thirds of its wealth controlled by millionaires, a wealth research company has said.
Sixty-two percent of Russia's wealth is held by U.S. dollar-millionaires and 26 percent of its wealth is held by billionaires, New World Wealth said in a report on Wednesday. 
Russia's economy is climbing out of recession and the International Monetary Fund sees it growing by 1 percent in 2017.
"If millionaires control over 50 percent of a country's wealth then there is very little space for a meaningful middle class," New World Wealth said.
Japan — the world's third-largest economy — was the "most equal" major country by this measure, with millionaires controlling only 22 percent of total wealth.
The U.S. was "surprisingly equal," with around one-third of total wealth held by millionaires.
"This is surprisingly low considering all the negative press that the U.S. gets in terms of income inequality," New World Wealth said.
Income inequality, along with stagnating real wages and the welfare of the working and middle classes, is in focus in the U.S. ahead of the presidential election in November.
New World Wealth ranks the U.S. eighth in the world for average wealth per person, which it puts at $151,000.
Up top on this measure was Monaco, where over 5 percent of the 40,000 residents are worth over $10 million. Wealth per capita stands at just under $1.6 million in the country.

Proportion of wealth held by millionaires:

    Russia: 62%

    India: 54%

    UK: 35%

    US: 32%

    Australia: 28%

    Japan: 22%

Putin’s Russia is a poor, drunk soccer hooligan

 
By Scott Gilmore    

Russia is not the country you think it is. Its economy is smaller than South Korea’s. Its people are poorer than Kazakhstan’s. It trails Finland in technology. And it has a smaller military budget than Saudi Arabia.
For most of the 20th century, what Moscow thought and did mattered from Havana to Hanoi. Then the collapse of the Soviet Union left behind a battered, broken shell of a country. When the Berlin Wall fell, so did Russia’s status in the world.
A boozy Boris Yeltsin was a fitting representative for a country whose average life expentency tumbled a staggering five years in the wake of the fall. There were the coups, industrial collapse, spreading corruption, and shrinking borders. After generations of fearing the Soviet Bear, the West patted it on the head, sent it some aid, and turned its eyes with expectation towards the emerging powers of Brazil, India, and China.
But Vladimir Putin’s rise to power marked a sea change in Russia’s fortunes. How the world sees Russia began to shift. The often bare-chested leader consciously cultivated a new brand, for himself, and for the country. Putin’s new Russia was a country that mattered again.
Russia hosted the Olympics, punched Georgia in the nose, took back the Crimea, invaded Ukraine, flew bombers through NATO airspace, built military bases in the Arctic, and generally flexed and posed like an oiled, aged, but still buff, body builder. And we’ve been paying increasingly rapt attention, not noticing the geriatric walker hidden just off stage. A closer look is almost shocking.
According to the International Monetary Fund’s most recent data, the Russian economy is approximately the same size as Australia and slightly smaller than South Korea. As an exporter, it is now less important than Belgium, Mexico, and Singapore.
And it is poor. The World Bank ranks Russia’s GDP per capita below Lithuania, Equatorial Guinea, and Kazakhstan. A larger proportion of its population lives below the poverty rate than in Indonesia, India, or Sri Lanka. It is ranked 67th in the world in the Global Competitive Index and 66th in the UN’s Human Development Index.
These economic woes are having serious social impacts. There are now fewer doctors than a decade ago. Life expectancy in Russia is nine years less than in the United States and is declining. Infant mortality rate is two to three times higher than most of the Western world. Its alcoholism rate is now the highest on the planet, three times North America’s; and consumption of alcohol has doubled in the past 20 years. Not surprisingly, the Russian statistical agency Rosstat has identified aging and shrinking demographics as the single biggest challenge facing the country over the next 30 years.
Intellectually, Russia is a distant speck in the rearview mirror. Once, esteemed Soviet universities educated the engineers and doctors of the developing world. Now, the United Nations ranks Russia’s education system behind nearly every other European country, and on par with the Pacific island of Palau. The technological leader that launched Sputnik now produces fewer patents per capita than Iceland. Its scientific publications are cited less often than Finland’s.
In nearly every indicator of health, wealth, and influence, Russia ranks below even the middle powers. What do they have left? Guns and bombs mostly. At 8,000 nuclear warheads, it still has 700 more than the United States. It ranks second globally for combat aircraft, military satellites, and nuclear submarines. Moscow’s military budget has increased every year since Putin’s arrival in 1999.
But even these numbers are misleading. According to data compiled by the Stockholm International Peace Institute, Russia’s defense budget is still less than China, and Saudi Arabia. It is roughly on par with India, France, and the United Kingdom. And it is nine times smaller than the Pentagon’s budget.
The fact is, if it wasn’t for Syria, the Crimea, and some ageing warheads, Russia would get as much global attention as Slovakia or perhaps Wales. Not coincidentally, those are two nations that recently played Russia in the ongoing European soccer championship. In both cases, the results were resounding defeats for the Russians despite their opponents being one-twentieth and one-fortieth its size, respectively. In spite of these resounding defeats, which have relegated them to the bottom of the league tables, the Russian team, and its fans, still dominated the news.
When we talk about the Eurocup, we talk about Russian hooligans rioting in the stands, attacking other spectators, and even assaulting tourists on the trains home. Or we marvel at the belligerent response from Moscow when Igor Lebedev, the Deputy Chairman of the Russian parliament and a senior official in the Russian soccer official tweeted “I don’t see anything wrong with the fans fighting. Quite the opposite, well done lads, keep it up!”
Lebedev understands a lesson that has been well taught by Putin: If you can’t compete on the field, make as much noise as you can off it. Russia is so far behind economically, technologically, socially, and politically, it just doesn’t matter anymore. But it can still get our attention, and it is.
When Russia next moves its tanks to the border, we should take it seriously. It has a lot of tanks (although less than Pakistan). But we should also remember that this is not a world power. By most indicators, it’s not even a middle power. Russia is a soccer hooligan: poor, drunk, and frustrated it can’t win anymore. It can only throw beer bottles from the bleachers.

Is Russia still a key world power?

 

By James Nixey

Russia and Eurasia Programme head, Chatham House
 

Whether Russia, one of 15 successor states to the USSR, which broke up in 1991, is still a genuine world power in 2015 is open to question.

• It remains the world's largest country and the largest oil producer
• It retains its permanent seat on the UN Security Council (one among five)
• Its nuclear arsenal (in Cold War times one of five countries, but now one of nine) has been progressively modernised
• Sustained increases in defence spending have brought it close to its goal of escalation dominance in local and regional war

But the economic base for these capabilities is steadily declining.
Russia's economy is the 10th largest in the world, producing little of value beyond hydrocarbons.
Corruption and rent-seeking extract an enormous economic toll.
It remains burdened with Soviet era infrastructure, and its ability to meet the educational and medical needs of its population is rapidly declining.
Whatever one's view, two further points for and against Russia's global standing are undeniable:

• Russia regards itself as a great power - it is not in question anywhere inside the country
• China has long since eclipsed Russia as the world's number two power behind the US

Yet for all Russia's pretence about a rebalancing of priorities towards Asia, since the fallout over Ukraine, it still measures itself against the West, and America in particular.

Distinct Eurasian niche

Regardless of hypothetical rankings or real-world measurements, Russia has carved out a niche for itself as a distinct Eurasian pole in world politics, allied to neither Europe nor Asia but seeking influence there and beyond.
Its membership of the Brics (Brazil, Russia, India, China and South Africa) group of rising powers suggests an acknowledgement that Russia has not quite arrived (there is no contradiction for Russia between this and pre-existing great power status) but also that is it is civilisationally distinct from Europe.
Certainly, there is no current desire to be part of most prominent Western-led organisations such as the European Union.
Indeed, Russia has striven to come up with its own alternatives over the years, the latest of which, a Eurasian Union, is designed precisely as a counterweight but free of the burden of Western norms and values.
Whether it will have a longer life than its antecedents, considering Russia's failing economic fortunes and other countries' evident reluctance to be joined too closely, remains to be seen.
Russia's mission beyond the quest for influence is hard to discern.
It is the world's most ostentatious foe of democracy promotion.
But its foreign aid is minimal (especially beyond the other former Soviet states - where its purpose is often regarded as a double-edged sword), and its contribution to UN-led peacekeeping has withered since the 1990s. 

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World's largest economies by gross domestic product (GDP) (in millions of US dollars, 2014):

• US: 17,419,000

• China: 10,360,105

• Japan: 4,601,461

• Germany: 3,852,556

• UK: 2,941,886

• France: 2,829,192

• Brazil: 2,346,118

• Italy: 2,144,338

• India: 2,066,902

• Russian Federation: 1,860,598

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Until the recent campaign in Syria, Russia had talked of itself as a global power, but behaved like a regional power.
Russia's greatest challenge is to preserve its global importance while most of the relevant indicators are dropping and its allies are few and far between (dictators, largely).
For some, Russia's natural and historical pre-eminence mean it will always be a key player.
Others fear Russia may compensate for weakness with risky foreign adventurism.
Indeed, for many, it is already doing just that.