The Parallax Brief


Unrepentant Subjectivity on Economics, Politics, Defence, Foreign Policy, and Russia

Conservative Russia

People simply do not realise that Russia is a deeply conservative country.

Fiscal policy is buttressed on a low, flat rate of income tax (13%), and there is virtually no social safety net, with spending on unemployment security, medical provision, disability aid, infrastructure, the environment, and urban regeneration far lower, in both absolute terms and as a percentage of GDP, than its G8 contemporaries.

Similarly, military spending is high in comparison — and growing — medical care is available free in theory, but requires private insurance or additional cash payment in practice, and businesses are in reality pretty un-regulated.

If that doesn’t sound to you like a set of policies Newt Gingrich or William F Buckley would support, then you don’t know your dyed in the wool conservatives from your woolly jumper wearing liberals.

The Parallax Brief believes, however, that these government policies are generally matched by the views of Ivan Six-Pack. Now, the Parallax Brief had been led to believe by his pinko sociology teachers in college that communism taught progressive views on gender, race, immigration and class, so it therefore came as a shock to find when he moved here that after 80 years of Marxist indoctrination, young ladies in Russia often reject feminism, men ooze with unrepentant machismo, and the population appears to generally support a penal code that could have been based on Dostoyevsky’s work.

The Parallax Brief passes no judgment on Russia’s conservatism (beyond finding it ironic that those who criticise Russia the most would like similar policies implemented in their countries (I’m thinking of you Charles Krauthammer, Ed Lucas, Anne Applebaum and the Republican Party)), but does view it as the foundation from which Russia can be better understood, and its news and policies better analysed.

With this in mind, over the coming weeks, the Parallax Brief will highlight news which he believes can be viewed best through the prism of ‘conservative Russia’, and hopes that in doing so he can provide a fresh and oft ignored perspective on Russian life – as well as, of course, stimulating debate.

First up, on Wednesday 11 March, will be Russia’s recent admission that it is the world’s leading heroin user.


Filed under: Politics, Russia, , , , , ,

Crisis Expained: MV=PQ

One of the best ways to understand why fiscal stimulus is of paramount importance if we are to avoid a Great Depression of the Twenty-Tens is that monetary policy has simply run out of room. Interest rates cannot drop below zero, and since the Fed and most major central banks are at, or will soon be at, zero, we need something more if we’re to arrest the decline toward economic oblivion.

A brilliant multi-media presentation from the Guardian (London) provides a hint as to why zero rates are proving ineffective, and ironically, just as the teachings of John Maynard Keynes are reentering the lexicon of politics after a 30 year hiatus, it is an equation beloved of Milton Freidman which provides the key insight.

Click here for the kind layman’s monetary explanation of the crisis I find useful, and why MV=PQ highlights the need for government fiscal intervention.

Filed under: Economics, , , , , , , , , ,