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Tuesday, February 06, 2007

Russia by the (Horrifying Neo-Soviet) Numbers

Russian Poverty by the Numbers

According to the most recent data published by the Kremlin (as reported last week on
La Russophobe), the average wage for a Russian person is $100 per week or $400 per month or $4,800 per year.

Let's assume this data is correct, even though it's almost certainly an overstatement (because the Kremlin is run by a clan of professional liars who have every incentive to cook these numbers and make themselves look better). We know that Russia has a significant number of millionaires. What is the significance of the fact that it does on the average wage?

The significance is this: for every person with an income of $1,000,000 per year Russia must have over
200 people who only earn $100 per year ($8 per month or $2 per week, fifty times times less than the national average) in order for the national average to remain around $5,000 per year. {here's the ghastly math: 200 people earning $100 per year earn a total of $20,000 plus one person earning $1,000,000 equals $1,020,000 in total income divided by 201 people equals $5,100 per person per year on average}

It's been reported that Russia has roughly 90,000 millionaires today. Assuming that each of them has an income of $1,000,000 per year, that means Russia must have 18 million people earning just $100 per year in order to keep the national average at $4,800 per year. That is equivalent to the populations of Russia's seven largest cities (Moscow, Petersburg, Novosibirsk, Nizhny Novogorod, Yekaterinburg, Samara and Omsk) COMBINED. It's 12% of Russia's total population.

Now, the picture is probably not quite that bleak, because a "millionaire" might merely be defined as a person who has a million dollars of net worth, and such a person could conceivably earn well under $1 million per year. So let's say she earns only $100,000 per year. If Russia has 90,000 people with a net worth of $1 million each earning $100,000 per year, it would need
1.8 million people each earning just $100 per year ($2 per week) to keep the average for the group at $5,000. That's more than the total population of Russia's third-largest city, Novosibirsk.

And that's probably a very conservative estimate, because the 90,000 millionaires could include any number of billionaires and many people with annual incomes of far more than $100,000. It's quite safe to say that although Russia's national average wage may be $400 (it's probably lower) Russia has at least 2 million people "living" on less than $0.50 per work day in wages, or less than $0.06 per hour for an eight-hour workday.

That's to say nothing of the fact that being paid $400 for four forty-hour weeks (160 hours) works out to an average hourly wage of $2.50 per hour in Russia, which is one-third the U.S. minimum legal wage ($7.50 per hour in California, $7.15 in New York). Russia's minimum legal wage is 1,100 rubles per month as of May 1, 2006, or roughly $41 -- so even those earning $100 per month are getting more than twice the legal minimum of $0.25 per hour for a 160 hour week.

In other words, Russia has a vast, vast underclass of desperately poor people propping up a tiny overclass of millionaires, just exactly the way it did a century ago in 1907, a situation that triggered the crazed Bolshevik revolution that led to the killing of more Russians by Russians than by any foreign enemy. Russians have learned nothing from this. They're doing the same thing all over again.

And at the same time, Russia has exactly the same form of government, a KGB dictatorship, that it had in Soviet times (no local elections, no opposition political parties, no independent TV news, dissidents being jailed and murdered, ridiculous 70%+ approval ratings for the dictator, etc.), a situation that caused the USSR to implode and disapppear. Russians have learned nothing from that either. They're doing that same thing all over again, too.


Vova said...

I am afraid the esteemed author of this piece or the translator thereof is confusing average and the median (both are средний in Russian).
So is there are three people, one earning $1,000,000 per annum, one earning $1,000, and one earning nothig, the mediam income would be $1,000

La Russophobe said...

ENDORPHIN: If you want to comment, comment on the appropriate post. Otherwise your comment is spam and will be deleted.

VOVA: Thanks for your comment. I'm not sure the point of it. Are you saying that $400/month is the median income in Russia and not the average? If so, please post a link to your source for this statement. The point in the post is that since Russia has a large number of millionaires and a very low average wage, this means a huge number of wage earners get next to nothing. It seems to me the point doesn't change much if we are talking about median instead, but if you think it does please explain.

Endorphin said...


I pointed out that you got 81.5 when you divided 166 by two. It gives a black eye to your credibility, if not intelligence. Especially when you jot an economics piece filled with numbers. A comment doesn’t get any more appropriate.

I tried to read what you wrote, and it's a common misconception of people anti-mathematically inclined: they think they can make sense to the public. While averaging the balance, you distorted the proportions on an unbelievable tangent! It's a common trick, old as the world itself. It's as if to say that given a combined yearly compensation of top 10 US CEOs of $340 million with per capita GDP of $40 thousand, deduct war expenditures, and you're left with trailer park trash population with food stamps that doesn't know how to eat with knife and fork.

The real data, the stuff you like so much, is that (yes, it's desperately low!) but no one in Russia makes less than $100 per month for a full time job. You can twist and bend the millionaire/poor proportion all you like; I still know that you had an F in college math.


La Russophobe said...


(a) Point it out in the post where it was done. (b) If you think making mistakes undermines credibility, you are demented. The only person who doesn't make mistakes is a person like you who doesn't actually try to do anything. Your attack is classically neo-Soviet, classically detached from reality, and clasically lame and doomed to failure. (c) Are you really saying that 83 as opposed to 81.5 undermines our crediblity? Are yo that drunk? Can't you see that if that's the only criticism you can make, you're admitting we're right rather than proving we're wrong?

As for your actual comment about this post, it's gibberish and blatant lies. The minimum legal wage that can be paid to a worker in Russia is 32 euros or 1,100 rubles.

In other words, MANY MANY people earn less than $100 per month as full time workers in Russia.

Your utter failure to even try to document your totally absurd statements is the classic hallmark of a Russophile doofus.

Endorphin said...

MANY MANY, that's how many?

La Russophobe said...

Even if it is only one, it is more than the ZERO you ignorantly claimed, you idiot. But I have given an estimate in the post, that is part of the point of it, you dimwit. You've given nothing but a noxious cloud of gas.

Endorphin said...

One is more than zero? You get F+ in CALC 101. Now go home and dream about sucking my Russian dick.


La Russophobe said...

Thanks for conclusively showing with that last remark which one of us is the better educated, more cultured and intelligent! You reflect ever so well on Russia, most impressive.