There’s no money, but you keep on fighting. Vladimir Milov on how Putin is running out of money for war effort
Vladimir Milov | 4 October 2022“There’s no money, but you hold on” is a phrase uttered in May 2016 by then-Russian Prime Minister Dmitry Medvedev during a visit to Crimea in response to a pensioner's complaint about her small pension.
As for the economic aspect of Putin's mobilization, most commentators focus on the disastrous consequences for the skilled labor market and the loss of jobs by companies. This is all true: for example, back in July Putin admitted at a meeting with his ministers that a shortage of a million skilled workers is expected in the IT industry alone over the next two years, and now it is clear that this shortage will only get worse.
According to a Rosstat survey of entrepreneurs, the lack of qualified workers is one of the top 5 factors limiting industrial production growth, and the importance of this problem in 2022 has increased. Mobilization poses the most unexpected threats, particularly with regard to the attempts to circumvent Western sanctions: for example, it affects small companies that specialize in complex schemes of parallel imports.
But the magnitude of the impact of mobilization on the skilled labor market has yet to be assessed; for now, we can only guess. But what has now become abundantly clear is that Putin will not have sufficient budget to maintain, equip, and supply the newly mobilized troops.
This is clear from the document titled, “Basic Trends in Budget, Taxation, and Customs Tariff Policy for 2023-2025,” obtained by Vedomosti. This document, for the first time, allows us to see the scale of the increase in military spending in connection with Putin's aggression against Ukraine. Its main conclusion is hard-hitting: Putin will not have enough money for further financing of the war and mobilization. All of his efforts are doomed, primarily financially. . . .
. . . It turns out that nobody is going to finance or supply this enormous newly recruited 300,000-strong (or whatever) force. Leaving aside other aspects,
we shall make only a single point - the army which is not paid and which is not provided with any supplies will not be able to fight. The fact is that the newly mobilized troops are being literally marched to certain death, because insufficient money has been allocated for their gear and supplies.
https://theins.ru/en/opinion/vladimir-milov/255681
Figures given are in rubles. The current exchange rate is roughly 62 rubles to the dollar. The money quote here is that Russia does not have the finances to replace the army they have already lost in Ukraine.
