How the Resource Curse Will End Russia Economically 

I listened to another RU-vidr from Russia yesterday i think his name is Constantin and he explained how the mayor of the town thats floded now because of corruption and neglect had apartments in both SaudiArabia and Dubai because of stolen money from the building of the dam that had broke, and the most stupid thing was that nobody is going to do anything about it because the whole system is so corrupt. one more thing is that they are talking about the decadent west how everything is so bad here but all there children get there educations and live in London or Paris, The hypocricy is monumental.

Amazing content that calls for repeated viewings. Thoughtful, beautifully organized, well-researched, highly informative analysis with a great historic precedent comparing Spain to Putin's Russia. Great historical comparison with hopefully the same results.

Absolutely brilliant. This gentleman is able to think clearly and understand things in a unique way. Insightful. Watch his other video on Putin.

The more I watch your videos the more I appreciate your analysis. Great background and weaving together of facts and info to create a very interesting picture. That picture is not available on the Main Stream Media. Keep up the good work

Before Russia (then Sovietunion) discovered oil in the 1950s, they had economy reforms allowing small businesses to establish as they realized that their planed economy isn´t working. And their economy improved. But then they discovered the oil fields and started selling crude to the West (Europe), so the reforms were stopped.

This vlog is mic drop worthy. Anna from Ukraine always refers to Russia as a dig and sell country and nothing else, but you really broke it down.

Too true 😊

Fascinating discussion.

Good points, thank you. I may add that it seems China is silently colonizing Russia economically and geopolitically without the need to fire a bullet or to occupy territory. All the work is being done by the ever increasing Russian dependence on China. In a few years from now Russia will no longer be a global player as a colonial status is incompatible with a significant role in world affairs. In the meantime Western markets continue to be the oxygen for China's [export] economy, so I am relatively optimistic that the West will find a non violent way of co existence with the Chinese.

Thank you

Thank you for your good information and analysis about Russia! Greetings from Norway 👍

I agree.

There is a lot of foreign RU-vid channels about the USA and our society as a whole. One of the things that many admire is our entrepreneurial spirit. Our society is built on innovation of free market economics that countries like Russia do not. Resources are great but they eventually run out leaving big holes in the land and their economy.

Great source of information. Thank you!

What a different, relevant, informed, important and awesome perspective!impossible to get this information from the mainstream! Thank you so much!

strangely addictive channel, must be because it is a triumph of content over presentation. That sounds really bad but I mean it in a very positive way, you do not need fancy studios, graphical content and "stuff" if what you have to say is good and I think it really is. Thanks.

Enlightened,thank you!

Good stuff

Again, that makes sense. Cheers Mark.

Great analysis and in my view spot on.

Well done. As I critique your assertion s, you are answering my questions Must be telepathetic.

Really enjoyed this and I learned something ....thank you 👏

Very interesting. Thanks for sharing this

Great insights. Very interesting. Very much enjoy listening to you and learning something.

Agreed!

Thank you, very interesting analysis

Thank you for the video!

"Karma ran over my Dogma" is a favorite saying. Vid on Karma would be awesome. Thanks.

Good point!

A thought provoking intersection between philosophy and economics. Thanks!

Thank yooooouuuuuu!

You can explain things really interestingly, you can explain even dry things so that the interest remains, thanks again Mark, greetings from Finland

A resourse not mentioned was the huge weapons cashe left by the Soviet Union. Russia is consuming it and it is mostly non renewable

The innovative russians, left.

Excellent video, liked,and commented for the RU-vid algorithm

Thank you very much fir great video!

Thanks again Mark. Glory to Ukraine 🇺🇦.

Nice vid!! Learned some new things about American history as well. Watch out for those gators!!

I appreciate your intuitive perspective!

thanks

Spot on.

Great video. Similar concept, Diamond's, "Guns, Germs, Steel".

Is the same thing Venezuela is going through, resource curse.

It is being done. We are shifting off of a resource-based economy to a knowledge-based economy. This is especially true with fossil fuels, but it is also true with other resources. When this war is over, Russia will go back to trying to sale their resources, but the markets won't be there. They are basically doing themselves in. In humorous terms: Our karma ran over your dogma.

Thank you and keep up the fight 💪 🔱🇺🇦🇺🇦🇺🇦🔱 Greetings from Sweden

Very interesting and informative. Russia will collapse, but to the outside suddenly, like 1991. Until they erase kleptocracy they will decline in line with the resource curse, also since only a few counties will use their outputs until they pay for Ukraine in reparations. Also is political move away from fossil fuels. ( Australia).

In Australia we only own the first six feet under our prorperties and have no claim to anything under it

Great video, great insights and analysis.

Your videos are great!

What I find interesting is that the USSR did fairly well in the first decade after WWII but that was before it developped its oil resources. Afterwards they used oil production to offset their lower productivity but that was in fact the mistake. Instead of liberating its people it tried to buy them off.

Agreed.

Mark, I'm not sure why this appeared in my feed, but I'm happy for it. Thank you for an interesting and thought-provoking discussion. It will be interesting, and will likely be instructive to observe how this plays out. I haven't scrolled your videos yet, so if you have covered it, then please excuse my ignorance. If you haven't already, could you explain the definition of a sideways Geni coefficient? As a tradesman where this is outside my area of expertise, I'm unsure what this describes in an income distribution and would enjoy learning more! Thank you.

He called it.

Hey,hallo,nice to see you again!

Mark, I agree with you that the Putin/Russian demise will be through the Ruble/Currency. What will Putin and Oligarchs do with no financial resources? I watched a video this morning showing a crowd of Russian citizens in the flood areas loudly complaining of no governmental help for the flood victims. One brave person said something to effect " with no governmental help, the governmental officials should end up on the end of pitchforks". At least some bread people are talking out loud about it.

I really like your videos and insights. You deserve more subscribers and views. This is what RU-vid was made for. Thank you 👍

Great analysis of unproductive asset even oil and gas

I didn't know that about the eighths. Learn something every day. Thanks.

Brilliant 😎!!! 👍🏻

Historical Context matters and l Really like the way you lay it all out

Well done

Good video. I believe that there are cultural problems within Russia which will prevent it from being able to change its perspective or its course. Doom is pending for Russia as it is known today - not really a good thing but maybe better than the alternative? Your identifying the Ruble as the most likely failure point does make sense. When you track the Ruble against the Dollar it appears that the currency manipulation is losing some of its effectiveness with a trend to loss of value. IF the trend continues (I think Russia may yet be able to slow or stabilize for a while) there are lots of ways this will be hurtful for Russia. I wonder whether Russia could end up becoming a vassal of China as is the case for North Korea. I might consider to be reasonably possible except I don't think China can afford it and putting two demographically challenged and innovation challenged systems together might not work out all that well?

Economist Richard Auty coined the term resource curse back in 1993 but this idea has been talked about since at least 1700s. Your explanation is all over the map and I believe a more focused presentation would truly benefit your viewers. [note-I can’t provide this explanation] Well known Russia expert Mark Galeotti noted that the Soviet economy was finally starting to grow and diversify in the 1970s and provide some limited opportunities for citizens when the discovery and exploitation of massive oil reserves began pumping huge amounts of foreign currency into the economy. This resulted in the cessation of most of this change and development as the oligarchs in power began taking the vast majority of this wealth for their own benefit. It marked a return to centralized planning and absolute state control. Who needed economic diversification and development when billions of dollars in hard currency is flooding in? The Russian system exists to allow a tiny minority of those in power to steal immense wealth while controlling and oppressing the masses. Officials in government and the military are there to steal embezzle and divert funds not provide services or take care of health and welfare of their constituency. Imagine how wealthy and developed Russia could have been if Putin and his oligarchs had invested just 10%-20% of the stolen billions into consumer loans and industrialization and economic development? China is the worlds largest economy. It’s also among the poorest in natural resources. Russia is the opposite. Russia has the economy of the state of New York and massive oil and mineral reserves worth trillions of dollars.

One example that comes to mind is Japan. They are a country that is lacking in terms of resources but they are an economic powerhouse because of the ingenuity of its citizens.

The reason I believe in _Karma_ as concept is quite simple, it is even stated in _Newton's third Law of motion_ . If you further expanding on this you will eventually realize that the universe is an ocean of energy, and just as a river flows downwards due to gravity so do energy do. If you further expanding this idea you enter into the domain of _metaphysics_ and to why _evil_ is _chaos_ and _good_ is _order_ in this context. And by this extension of thinking you will come to the conclusion as to why _evil_ will eventually fail, just as someone tries to walk against the flow of the river, eventually they will run out of energy used to project _chaos_ into the river. Karma is physics!

Mark, this is one of your better videos l gather, really impressive subject you chose. Btw, South America isn't comprised of a lot of little countries unless you mean economic wise. Thanks.

Fascinating. I've heard the idea that you need to be challenged to grow and develop as a person. If you're always given everything, you don't learn and grow. It never occurred to me that this concept can be applied to a larger scale, like whole countries.

Humans need to be equalized by uncoupling the monetary system from resource based economic growth. Resources have been the only way to pull people out of economic poverty in the past. This has turned out to be the biggest reason form monetary inequality. 8.1 billion people get 7,000 dollars per month all year long every year. A great start to monetary equalization and improved resource understanding and management. Drawing out resources over a longer amount of time so that thousands of years from now our future generations have projects they can take on. Thank you.

West Virginia lived the resource curse.. their still recovering. The children won’t quite school knowing a high school diploma is their only way out of the state. The demographic has collapsed and there was never any infrastructure built from taxes because the state politicians were corrupt and no taxes were taken to supply the state with funding.

Very interesting ! I continue to follow you. Regarding the metaphysical aspect, I myself am surprised and... frightened! A scientist uses numbers and formulas: he tries to explain the functioning of the world on these verifiable bases. And then comes the supplement which is not found in the formula: and this supplement appears as revenge and not as ignorance, even if what is happening in Orenburg is the consequence of bad actions ! ...ditto for the next future forest fires in Siberia. Russia is cursed . It's frightening. Cheers from Belgium !

Getting off of fossil fuels would help a lot. Improvements in recycling and repairing all sorts of products I think would too. I'm not intending to be snarky with this comment. I think economic degrowth could help in a lot of ways. Speaking as USian many of my working and middle class peers talk about having too much stuff, getting flimsy t-shirts for all sorts of participation, there's all sorts of knock-knacks being made so people can always give a gift even when no one wants the thing. Best Buy is trying to get people to 4k and 8k TVs, when most people do not even have the cable package or movies to make use of it. Taking more time to build better quality items and then being able to fix items I think would encourage creativity too.

I remember down in Ft Lauderdale, years ago, my uncle told us all these rich guys down at the beach were Russians, probably sons of the oligarchs. I suppose only the top 1% of the population, if that?

I visited the sea shell fort in St Augustine. It's really something. Cannon balls would bounce off of its spongey walls. There's a dent in one of the walls.

Capital is a ressource. Does Capital suffer also from the ressource curse? The Ginii coefficient is a measure of governance. Does the class that make the societal rules put - the needs of the few owners of Capital above the needs of the many common people? or - the needs of the many common people in balance with the needs of the owners of Capital. The role of Gold and Silver was to serve as Capital in the days of the preindustrial (artisanal economies) empires. There has been a lot of changes in what constitute Capital in the financial systems of industrial empires. We should ask Elvira Nabiullina what she think about the objectives of governance of the current Russian government.

Great job

I was saying to my wife maybe half a year ago, Russia has a lot they are not really capitalizing on. They could have such riches that would benefit everyday Russians. Look at plywood. They could make most of the world's plywood. They could build facilities to cut and process hardwoods and softwoods, manufacture plywood, and ship it around the world. It would take time plus people. Think what a tremendous undertaking that would take to dominate the world's plywood. Trucks, chainsaws, etc. It would require a lot of those machines. The could develop the manufacture of those things and could develop an export market for those things. Like Husqvarna. Multiply that times every product from steel, petroleum, etc. not to sell but to service their own industries. Rather than a few people getting rich, every Russian would get a benefit. Happiness would grow. Russia could be the richest country in the world and they could do this legitimately and without coercion. Well, you're an economist. I don't need to tell you. Instead, they are like the Mafia.

Interesting

There's many examples for this. Venezuela, the island with the bird poop (to used as fertilizer), many oil rich countries. Finland was poor in resources and made the conscious decision to invest a lot of money into education. The only exception is probably Norway. Perhaps because they discovered oil AFTER they had already established a stable society / democratic government?

If only russia had human inhabitants, and not orcs it would be possible.

The curse is laziness

Thanks!

You are absolutely right.👍 I have another example: Argentina and Japan. Argentina was one of the richest countries in the world. It has all the most important minerals: gas, coal, metal ores, etc. It has some of the most fertile land in the world. And it is bankrupt with hyperinflation and no prospects for a better life. Japan has had nothing but earthquakes, tsunamis and wars. Now it is one of the richest and most powerful countries in the world.

Fascinating stuff. Thanks.

Pay no mind to the noise in the woods. It was just a bear behind you with a gator in its mouth, obviously not interested in another meal. Dutch Disease definitely applies here. Except for crappy cars and a state run military industrial complex, Russia has almost no manufacturing sector. Few people saw the fall of the Soviet Union coming, and yet it did. The signs of Russia's demise now, however, are prolific.

What is a genie co-efficient? The Gini coefficient measures the expected gap between two randomly chosen people in a population. If the Gini coefficient is low, it means that the gap between the rich and the poor is relatively small, and if it is high, it means that the gap is large.

Excellent video!

Hi Mark! Very interesting discussion! I believe that Russia will exhaust itself militarily, leaving its largely unpopulated and resource-rich eastern territories open to assimilation by other population-rich and resource-poor countries, such as, obviously, China. That will remove or at least diminish the resource curse of Russia proper, and rebalance Eastern Asia demographically.

Tyranny Corruption Low Development Conflict Genocoefficient gone bad Lacks diversification of redources

This is another reason why Ukraine has a brighter economic future than Russia in its current form (even if the investment to rebuild after the war is mediocre, it'll still be true): Ukraine has a diversified and rapidly modernizing economy. Yeah, they do have a lot of mineral wealth and their agricultural potential is legendary, but they also have a beefy heavy industrial sector, a rapidly growing defense industry, a tech/service sector based mostly in Kyiv and Lviv, a well established utility sector with some of the biggest nuclear plants in Europe...and those are just the major ones. Russia's export revenue is ridiculously skewed toward oil and gas exports (even more so now that their military/defense exports have plummeted). The ongoing global shift away from fossil fuels will doom the Russian economy if it doesn't completely revolutionize itself. Ukraine will weather the transition just fine.

ESPO - tick, tick, tick ⏰

Very interesting explanation. I was intrigued with what you said particularly the depth of your explanations which I could not find fault with. It is pity that more economists or those who call themselves economist but do shallow research and draw poor conclusions do not do that in depth study.

Spain's case with the abundant gold coming from the Americas is a case I don't see very much in history books, yet it is one of the hardest and most clear lessons of why nations must avoid the Resource Curse at all costs. The influx of gold and silver rendered manufacturing and high value industries and even farming far less competitive because the the appreciation of the exchange rate. Spain starting importing almost everything, from swords used in the military to even ships and many other things. Absolutism didn't help either and high corruption and lack of solid institutional frameworks accelerated the empires declined.

Look what happens when someone escapes his straight jacket and then stands in front of a camera.

If a currency is not fully and freely convertible, then it is impossible to do more than estimate its value.

Superb analysis.

By renewable energy - of any kind. I. believe we are entering an age of abundance, and this will come true also for Russia. However, the next years will be a humpy ride. - including the collapse of the Rubel.

Excellent Mark.

Mark/Marc, this is a phenomenal video, topic & its incredible information, & I listen to it three times. I loved it, why? As you say in every one of your videos, You Want To Help make the world a Better place. Russia is truly living these six curses, their SoCal invincibility, is shown in this devastating war in Ukraine🇺🇦, & the Huge unimaginable losses of Russian soldiers, in Ukraine🇺🇦. I agree, The World🌏 will be a better place, with the collapse of Russia & the total change of it's SoCal "president" & gangster Duma.

Russia, Russia, Russia. 😂

14:03 Communism really erodes societies; their trust in each other, their ethical and moral centres, their ability to function after the end of the communist regimes. Some nations like Eastern Europe have mostly repaired and are thriving but likely because the leaked the land and resources Russia had so they needed to really come together and reform but also because the communist system had less time to wear them down. Russia never escaped the legacy of the communist erosion of society and, just like China’s economic reforms, a bit of renewal a couple decades ago wasn’t enough to undo all the damage at the societal level which is why crime, tyranny and generally antisocial behaviour run rampant in both China and Russia. It’s very sad and doesn’t bode well for the near or medium term heath of these societies even after they free themselves from the current systems. They will both need decades of healing to repair what Communism did in the past and neo-communism/ethic nationalism is doing to them now.