Latvian Political Monitor

From@Gerashchenko_en

An economics lesson for Tucker Carlson from Britain’s Jacob Rees-Mogg. In reality, the war is what is currently keeping both the Russian economy and Putin’s power afloat. Ending the war will trigger a "demilitarization shock" to Russia’s budget. In recent years, state defense orders have been the main driver of Russia’s GDP growth. Russia plans to allocate 17.1 trillion rubles (~$201.6 billion) to military spending in 2027, a 32% increase compared with the 2026 budget. A sharp decline in the production of purely military goods (ammunition, armored vehicles) would cause a downturn in related industries and slow GDP growth in the first year. Hundreds of thousands of returning servicemen and defense-industry workers would face falling incomes. Replacing extremely high wartime payments with market-level wages in the civilian sector would be virtually impossible, which would also reduce consumer demand. The market would not be able to quickly absorb the millions of people connected to the army and military-industrial complex. The end of the war would also hit regions with a high concentration of defense plants hardest (Kurgan and Tula regions, Udmurtia, and Tatarstan), where factories would lose guaranteed demand. Russia’s budget is deeply in deficit (in the first half of 2026 alone, the deficit reached around 5.7 trillion rubles (~$67.2 billion)), and the liquid part of the National Wealth Fund has been depleted. Gold reserves have been sold. Transitioning from a wartime budget to a peacetime one would require enormous spending on social benefits, rehabilitation, and economic restructuring, while export revenues would remain under pressure from sanctions and prices. And I would not forget about the reparations that Russia will have to pay to Ukraine for its war crimes. Putin is destroying Russia - demographically, economically, geopolitically, and, worst of all, morally. By the way, I am sure Tucker Carlson understands all of this perfectly well.

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