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To treat the disease, not the symptoms. Alexei Kudrin audits of first aid kits for the economy
Material posted: Publication date: 12-06-2020
The head of audit chamber and one of the main economic ideologists of the Kremlin , Alexei Kudrin, in an article for the “Kommersant”, talks about his views on the priorities on which to focus on for the inevitable formation of anti-crisis policy to use the situation to launch the necessary reforms. The list of Mr. Kudrin, health and incomes, economic freedom, and adequate state administration, the rest can wait.

Erupted in 2020, the crisis associated with the pandemic COVID-19, has already provoked two types of reactions from States, companies, experts. The first type of crisis. This is the response to the crisis from governments and businesses, which are designed to mitigate its impact. The second type is a visionary. Now the best global experts talk about how "the world will never be the same." In my opinion, today there is an acute problem of the lack of practical "linking" these two types of reaction, crisis and strategic policies. If we focus only on tactics, then we can manage symptoms, but chronic diseases of our economy will not fix.

Since strategic benchmarks have become a cornerstone in the definition of measures of medium - and long-term policy, I would like to propose a series of questions, the answers to which will largely form the action strategy after passing the acute phase of the crisis.

The first block of questions devoted to the development of international economic and political relations. How to change globalization? It will intensify national regulation to the detriment of multilateral and supranational regulation or globalization and multilateral cooperation after the crisis it will again gain momentum? Continue to grow logic of confrontation, the confrontation in the form of trade or resource wars — or at the forefront stand the common benefit from cooperation, even if in some areas the participants of the agreements will be to lose?

The important question, what will be the rule of engagement States, especially superpowers, the processes that occur outside their borders? The extent to which spending on these external operations will be maintained within the country? Will the issues of traditional security, the key element of the agenda to the detriment of economic development? Will States to increase military spending or will direct more resources to development, knowing that the economic downturn is the major threat to security?

The second block of questions devoted to the forks in the sphere of economic policy. Will the nationalization of an important element of anti-crisis and post-crisis policy of the States or affect only certain sectors and for a short time? As a General will to develop the private sector, especially SMEs after the crisis? Today we see that, according to polls, only 13% of small and medium enterprises believe that the just will survive the crisis (the data of monitoring of the business Ombudsman Boris Titov, 19 may). In General, in recent years, conversations about the support of private initiative has become a ritual, a real reversal to the support of private initiative, which has been repeatedly stated, is not happening. And now we need to do without delay, not only in the framework of anti-crisis policy: in the coming three to four years, we need to show real results in this direction.

First of all, significantly reduce regulation. Need more freedom.

How to change the structure of the economy and the industry that these changes will affect the most? To save his influence for Russia, with its population and territory there can be output only in a multiple increase in performance in the forced introduction of technology, digital and management innovations. And innovation requires a different institutional and regulatory environment.

What will be the new consensus on health issues? Whether citizens and governments are willing to spend significantly more spending on health care, rebuild policy, a way of life? Now the underfunding of this sector becomes obvious. Heroism of doctors and other workers in the sector in the fight against the pandemic, certainly, but sometimes they have to fight with "bare hands", not having equipment, medicines, modern technologies! Just need a radically different approach, jump in the direction of another model, ensuring the health and longevity of citizens.

How to change conceptual approaches to education? Are we willing to increase investment in this sector, in particular, increase opportunities for free education? What are the approaches to education quality in the era of the widest selections of digital capabilities for receiving, as this flexibility will affect universities, colleges, schools? This is clearly not just a "transition to online", which, within reasonable limits, and in the right proportions will occur, it is also a focus on the development of "soft skills". A restructuring of the whole process of training and education in the logic models of learning throughout life, constant retraining.

Not to mention the key for our country the question — what will be the role of oil after the pandemic?

Before the crisis, and the role of hydrocarbons in the world was reviewed, including due to climatic changes and discussions about the future of the planet, now it becomes even more important. Alternative energy is becoming more affordable. Oil production in Russia will not fall, but the rent that was past 20 years, we will be gone. For the entire economic policy, including budgetary policies, is a key challenge if non-oil sector will develop more actively. "Rent" will now give new technological and innovative solutions, a number of innovations, but only if we stay ahead of the curve. Came the most critical moment to turn from the oil economy to the knowledge economy and technology.

Apart from the fact that digital technology, the virus is terrible in the least, they provide a completely revolutionary solution. Is changing the face of entire industries. And our regulation and public administration here late and do not meet these challenges. We can talk about this for a long time. A request for a new quality of regulation is now extremely high. After the arrival of a new government in January it was obvious awareness of the problem, there has been a vector for change in this direction (for example, digitalisation of public administration, focus on work priorities). I hope this vector due to the crisis will become more visible.

The third group of issues associated with the development of regions and cities. Whether the Federal center to try to steal resources for themselves, citing the best information and the sharing option, or agree with the fact that "from the know better what to do", and hence the resources should be in place?

The fight against the virus, which showcases hundreds of local solutions in the fight against a global challenge, made so obvious that all regions of the situations that the federalization of the large variability of legislation and regulation become obviously necessary.

While today almost 3% of GDP of transfers from the Federal budget to the budgets of regions, only about 0.7% of GDP — unconditional grants for leveling, which the subjects may have based on their understanding of the situation. Without expanding the autonomy of regions and their resource base, coupled with a significant increase in unconditional transfers from the centre, the development is impossible. The most important issue is the development of a strategy for the development of agglomerations and Metropolitan areas, to ensure the health of their inhabitants without losing the agglomeration benefits associated including high population density and contacts between people.

Finally, the fourth group of issues is linked with the development of society. Cope is the state with the temptation of the opportunities exclusive to the collection and use of information about its citizens? Whether it will lead to restrictions on freedom in the other cases? And, most importantly, will we be able to go to institutional regulation, which includes checks and balances, or will continue to rely on familiar mechanisms of administrative hierarchy? Low growth and stagnant incomes over the last decade, one obvious way to answer this fork: no new model of development based not only on hierarchical instruments and on modern institutions can't handle.

That would be the logical thing to do in this situation? There is no doubt the need for various anti-crisis measures and the plan to rebuild the economy. But these tasks must be synchronized with the strategic path. Until 2024 remained only four years, during which you need at least another year and a half to overcome the effects of the crisis.

In this situation it would be advisable to focus on a limited number of national goals.

Again, all announced today Natali correct, but we need to focus on the most important and accurately to achieve them result. For example, the pandemic has shown us all that there are four clear strategic objectives:

  • we want to be healthy and live a long life;
  • we don't want to be poor and that our revenues grew;
  • we need a growing innovation, including the digital economy;
  • we need adequate time challenges public administration and institutions.

Other goals are certainly important, but derivative from the above.

Accordingly, under the new set Nacala needs to be rebuilt and the tools to achieve them. The national projects should be linked to natalee, their activities have a direct impact on the achievement of Nacala what not happening today.

A smaller number of priorities will allow you to focus on achieving them "nerezinovoy" public resources. When other tasks must be synchronized with the current context and to be appropriately extended, pushed back to 2026, 2028, or even 2030. Part of the ongoing initiatives, if they are placed in a new logic, with appropriate additions and the focus can be in a new build, and continue to be implemented. Some should pause and to postpone, in some cases, to replace other solutions that are more effective. It is normal practice for flexible public administration, based on the main result — the satisfaction of citizens.

In March 2018, I talked about the window of opportunity for structural reforms and that it will be open for only two years. But the virus has put new challenges and pushed to the decision of those questions which has long been postponed.


Tags: Russia , USA , economy

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