To have a villainous ruler forced upon you is a misfortune, to elect him yourself is a disgrace.” Samuel Adams
“Russia is falling apart as a direct result of its war against Ukraine.” Konstantin Inside Russia
The Russian war economy is booming while the civil economy is collapsing. And Russia’s Central Bank destroys the foundation of the Russian economy by sugarcoating the situation
Russia has seen a massive phase of utility failures in recent days. A 100.000 square meter warehouse of Russia’s largest online retailer has been burned to the ground.
Chris O suggests that Russia may hide over 500 data sets to cover up the real damage that the Ukraine war has done to the Russian economy.
I will cover two topics in this story:
1. The general situation of the Russian economy
2. Incidents such as fires, floodings and plane crashes that are linked to the sanctions.
I consider the sanctions as a pivotal geo-political chess piece to get Russia to retreat from Ukraine
There are two economies in Russia. The war economy sees rapid growth. The civil Russian economy is in full collapse. The optimists count on 3 percent growth for 2023.
In my opinion, these optimists mistake the Russian economy for a “normal economy.” Normally, 3 percent growth would mean that wages are growing, sales are increasing new investments are being made.
This growth is fueled by defense (offense) spending. Konstantin
Just think about it for a minute. The war economy saw 40 percent growth in the first half of the year. This growth has slowed down, but it is still tremendous. The civil economy has crashed, given this meager growth of 3 percent overall.
The optimists base their optimism on only one number. This number is GDP growth. I think the view of the optimists is fundamentally wrong.
Elvira Nabiullina talked about the transformation of the Russian economy. From a civil economy to a war economy
Russia clearly fired up old Soviet plants that produce weapons, missiles, and ammo. Everything that’s produced is then used up in Ukraine. This war economy can also be called a one way economy.
The military industrial complex (MIC) has received a 100 % down payment from the government. That means they have been producing death tools nonstop in 2023.
Expenditures on the MIC grew 10 fold to 10 trillion rubles. That’s one-third of Russia’s budget
The civil economy declined tremendously. In November alone, the agriculture industry declined by 23.9 percent. Year on year, it declined by 2 percent.
There are shortages of eggs, gasoline, diesel fuel, chicken meat, and other items. Most industrial and infrastructure projects have been frozen or stopped.
One of the few sectors that operates almost unimpeded, is the civil construction of housing
The Russian government provides subsidies on these mortgages to prevent the market from collapsing. Russian private companies have stopped investing. Foreign companies aren’t touching the Russian market anymore.
The civil economy in Russia has already crashed. Manufacturing of consumer goods, private cars etc. has crashed. Instead, Russia has to rely on imports paid for in dollars. No one needs rubles to buy things.
The ruble is a managed currency, and a weaker ruble drives inflation
According to the manipulated data of Rosstat, the inflation in Russia is sitting at 8.5 percent. Experts believe that the inflation is sitting in between 16.5 to 25 percent. Some others, me included, think that for certain goods, it is even higher than that.
The war economy is directly to blame for this situation. Nothing is produced for civilians. All of the war production is going to Ukraine.
Those involved in the military industrial complex attract people with a lot of money. Many of these men never had so much money. Many spend it all on TV or other luxury consumer products. Russia claimed that without any competition, they would become self-sufficient. This plan has failed.
All the goods and products used in Russia are manufactured abroad. They are bought and paid for with American dollars.
In 2023, we saw record bank profits, unsecured loans, and a historic record high in defaults. Elvira Nabiullina warned the Russian commercial banks to keep these profits to offset losses in 2024 and 2025.
The interest rate in Russia sits at 16 percent, which will make taking out loans very difficult. The only investor left is the Russian government.
Russia’s unemployment rate sits at 2 percent. In a healthy economy, the rate is 5 to 7 percent. Anything under 4 percent is not healthy. This lack of skilled workers has very bad consequences, which we will look at next.
Konstantin thinks the number of those that fled Russia is close to 3 million people. On top of that, there are also enormous war casualties
Russia’s higher than expected oil revenues are the main reason why the Russian civil economy hasn’t completely collapsed. Still, Russia’s rainy day fund is depleting rapidly. Konstantin states that only 4 trillion rubles (40 billion dollars) are left in the national welfare fund.
Russia was bragging about how they will freeze Ukraine. Ironically, it is now the Russians that freeze
The sectors most affected by the war and the sanctions are: the aviation and automotive industry, housing, and communal services. The government can’t hide the damage of the sanctions. Lies incur a debt to the truth. Sooner or later this debt must be repaid in full.
The utilities sector is run by state owned enterprises. Systemic corruption, especially widespread in this sector. This won’t exactly make acquiring the necessary funds for the necessary modernization of these heating systems any easier.
Most of these apartments were built in the late 50s, to early 60s.
Hundreds of thousands of kilometers of pipes were installed in the 60s, 70s, and 80s. The lifespan of these pipes is 25 years. Russian authorities say that 44 percent of the country’s supply infrastructure has already exceeded its service life.
The Russian authorities cut the federal budget spending on housing and utilities by 40% in 2025 and another 20% in 2026. Well, the money for this ruinous war must come from somewhere.
In general, 65 percent of Russian housing are made up of apartment blocs, 31 percent are homeowners, and 4 percent are dormitories
Roughly 60 percent of these apartments are gas-fired. The rest is either fired by coal or wood. While house owners often take care of their own heating, the apartments are 100 percent dependent on these utility companies.
These heating plants are centralized in Russia. There are huge power plants and large industrial factories, and their excess heat is used to heat these apartments
This sort of heating is highly ineffective. A lot of heat is lost on the way from the plant to the houses. Currently, we see pipes burst all over the Russian Federation. These breakdowns had happened quite frequently in Soviet times. In Putin’s Russia, at this scale, this is a novelty.
There is frost inside this flat after two weeks without heating.
This Russian lady got it right. “What has been getting ruined in over 20 years by Putin cannot be fixed in one or two days.” Indeed, the Russian empire is rotting from the inside.
In Novosibirsk, the situation is very dire.
About 2,500 buildings in the city are without heat. Over 500,000 people live in these buildings. The weather forecast expects temperatures between minus 18 and minus 28 degrees Celsius in the coming week.
There are three main reasons for these breakdowns
- Money
- People
- Hardware
Since the start of the war, Russia hasn’t spent enough money on subsidies for the utilities sector
In the past 10 years, Russia has illegally annexed five Ukrainian regions. (Crimea, Kherson, Zaporizhzhia, Luhansk, and Donetsk) Russia destroyed large swathes of the territory it has temporarily seized and occupied.
The Russian state spends large sums to rebuild these towns and cities
Therefore, Russia must restore its own utility infrastructure and the infrastructure of Mariupol, etc. It seems that Russia can neither afford to win nor to lose the war in Ukraine.
For example, the money for the reconstruction of Mariupol comes from the St. Petersburg budget.
Secondly, utility enterprises were hit the hardest by the mobilization. Many state employees were either sent to die at the front, or they were instead used in Mariupol and elsewhere to fuel Putin’s poisonous dreams of empire.
The third aspect is the lack of technology and hardware
We are talking about power generation, transmission, and distribution facilities. The equipment that Russia uses here is modern, cost efficient, and effective. Ergo, it’s not Russian. All of the foreign companies such as Siemens have left.
There are only two Russian manufacturers that work with outdated Soviet technology. This equipment is old, expensive and highly inefficient
Due to the sanctions, maintenance services by foreign manufacturers are not available. The spare parts aren’t available directly anymore either.
That being said, I think it is unlikely that the Russians will freeze to death in their homes in large numbers this winter
I think that Russia got enough materials left to fix these damages somehow. But, that’s only a temporary solution. Russia lacks the money, the people, and the equipment to renovate these facilities. Therefore, 2024 is just the beginning.
The winter of 2025 will cause more damage. Russia’s dilapidated infrastructure could only receive proper maintenance with Western know how and with the assistance of our specialized workers.
Russia is experiencing a process of reverse industrialization
This process will ultimately contribute to a catastrophic collapse of its dilapidated civil and war infrastructure. The current situation shows some parallels to the last years of Tsarist Russia. The Russian bear is wounded. However, it isn’t dead yet.
The “hard worker” type, that is, that same worker or plumber who monitors the condition of utility pipes, is especially vulnerable to mobilization. Natalka, on X
There was also a very serious accident at the Magadan thermal power station
After the incident, there was not hot water in several districts of Magadan.
Generally, the heating systems are failing. In the Russian city of Lipetsk and across the entire Federation. Hot geysers come from the ground. A total of seventy apartment buildings were affected.
The temperatures in Russia are currently below minus 20 degrees Celsius in several regions
Additionally, in the Rostov region, explosions could be heard near one of Russia’s largest chemical plants. These incidents can be directly linked to the war, the lack of spare parts and the sanction pressure.
There was also a massive fire in St. Petersburg. The probable cause is arson. A huge warehouse with an area of 100.000 square meters burned down
The company that owns the warehouse is called Wildberries. It is a clone of Amazon. The company has allegedly mass delivered slave soldiers to the Russian army. Companies in Russia pay a sort of slave toll. In September 2022 alone, the company may have delivered up to 3000 men to the Russian army.
Since 2022, Wildberries helped police to mass-arrest employees and forcibly recruit them. They pushed them from the warehouse into streets, where police waited for them, and arrested for the army. Sergej Sumlenny
The warehouse in Koledino, Moscow, couldn’t function properly due to these deportations
This massive fire was likely caused by furious workers whose slave owners planned to sell them to the army. This video shows the collapsing roof on the sixth floor of the building.
The workers sure as hell sent a fiery message to the management to voice their malcontent about the way they are treated by Wildberry’s management.
The sanctions also affect Russia in the aviation sector. The lack of spare parts and available planes may force the entire industry into a standstill
For example, during a flight on December 29 from Moscow to Kogalym, Tyumen Region, a Boeing suffered an engine failure. The machine then performed an emergency landing.
All passengers are alive and well. This will happen again and again. Russia cannibalizes Western planes. That strategy has a due date.
Summary and Conclusion
In my opinion, the Russian economy is in a much worse shape than some analysts are misled to believe.
It is very likely that Russia covers up the real damage that was done. These incidents are only the beginning. This will get a lot worse. The Tsar, his boyars, and the war economy will ensure that the Russian middle class will cease to exist.
Unless Russia retreats from Ukraine, the Russian empire is likely headed towards its third collapse within a century
I would be surprised if the Federation doesn’t collapse within this decade. The Russians and their Tsar continue to pay dearly for their barbaric venture against Ukraine.
Those millions of freezing Russians will soon curse the day when they handed Europe the sword. Those who bring the sword die by the sword.
“The study of history is the beginning of political wisdom.” Jean Bodin
Chris O found evidence, that the Russian government hides a vast amount of data sets from the public eye to hide the real damage that was caused by sanctions
Over 500 datasets have disappeared since February 2022. They were covering everything from weather to state pensions. The data was either suspended or fully removed and never published.
The data includes imports, exports, oil production, and oil refining
This data hides companies which are subjected to sanctions or those involved in the military industrial complex and those who facilitate Russia’s import substitution.
The data also hides government procurement and budget expenditures
Data of those KIA, WIA, or taken as POW in Ukraine is also hidden or not collected. Additionally, monthly data on crimes committed with firearms, ammo, or explosive devices was also removed.
The Russians don’t provide data on migration, power plants, power lines, and radioactive waste storage
Even energy consumption data is not available. This data in particular could provide a very clear picture of the real state of the Russian economy. Konstantin summarizes Russia’s situation like this.
“The Russian economy is on its way to hell” Konstantin
Dear reader, thanks for reading my story
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Take care and be well.
“Russiae Imperium delendum est” Chris the younger
Sources: (You can find some videos about bursted pipes and crashing planes here)
