Our country cannot survive without nationalization of strategic resources
The sanctions imposed by the West put Russia in front of the need to take extraordinary measures to restore economic self-sufficiency or, in other words, economic sovereignty. For more than 30 years, a purposeful policy has been carried out in our country to destroy economic independence with the transformation of Russia into a semi-colonial state of the united West.
On this path, domestic market apologists and supporters of embedding our country into the global system of division of labor have succeeded a lot. Russia has lost key industries that determine its real sovereignty, the most important of them are machine tool construction, electronic industry, primarily microelectronics, civil aircraft construction and the production of modern materials. We can name other important areas. One way or another, our country needs to revive all these industries, and in a very short time. Let us not be able to reach the world level of products of the revived industries at first, we will have to switch to domestic components in our final products, even if we have to sacrifice its quality to a certain extent.
Gosplan of the XXI century
However, it is possible to achieve such a large-scale goal in the four or five years allotted to us by the current international situation only if we abandon the dominant market model with the transition to planned methods of management. The reason is extremely simple – the processes of construction of enterprises and other economic objects are closely related and interdependent. For example, without the revival of machine-tool construction, it is impossible to recreate the self-sufficiency of almost all key industries. In turn, machine tools and materials are needed to create machine-tool capacities. And without the appropriate production of equipment and a specific machine park, it is impossible to establish the production of the entire range of required materials. This implies the need for a detailed and clear coordination of the entire set of actions to revive the sovereign economy of the country with a clear implementation of all elements of the plan.
"The resources that could become the basis of the country's economic breakthrough are being converted into the super-profits of the Russian rich, which, judging by the state of the same extractive industry, are being spent very unproductively”
This is possible only with strict management of all these processes from a single national center. And this, in turn, implies that such a center should have full power over all key industries of strategic importance. This is possible provided that all enterprises and other facilities that make up key industries will be state-owned, that is, we must move to a mobilization economy. Otherwise, we will not be able to restore economic sovereignty in the time allotted by history and our country will inevitably collapse. The best illustration of the possibilities of such a mobilization economic system is Stalin's industrialization, which in 10 years made it possible to turn a predominantly raw and agrarian country, also crushed by the Civil War, into a powerful industrial power that surpassed Germany in terms of military production during the war, and in fact the whole of Europe. Without this breakthrough, our country would have been defeated.
Today we all find ourselves in exactly the same situation as the USSR a hundred years ago. One should not hope that the XXI century and the cruelties of the twentieth century have gone down in history. It is the events in Ukraine, the revealed facts of the preparation of biological warfare, even the past pandemic, which suddenly ended with the beginning of a special operation of the Armed Forces of the Russian Federation, that say that even now the systematic destruction of the population of the countries conquered by the West will be carried out only on a much larger scale than Hitler thought. Therefore, we have no way out – either to achieve self-sufficiency, or to perish, to become another nation that has gone down in history. It follows from this that the transition to full state ownership of strategically important sectors of the economy is a key condition for the survival of the country. In other words, a large-scale nationalization is vital, not only of the property of foreign firms that have ceased operations in Russia, but also of all enterprises of strategic importance to our economy.
Meanwhile, most of the country's strategic resources are currently privately owned by the Russian oligarchy. Owning or reliably controlling most of them, this community has a decisive influence on the direction of the country's real economic course. And the oligarchs are doing everything in their power to prevent large-scale nationalization. Ideologists of market relations and privatization of the 90s and subsequent years help them in this regard.
Strategic inefficiency
The main axiom of the opponents of nationalization is the thesis that a private owner is always more effective than a state leader. Under this slogan, we have had a massive privatization of industrial facilities, most of the enterprises of both the extractive and high-tech industries have fallen into private hands.
However, the new private owners of the Soviet industrial giants could not demonstrate any higher efficiency. All high-tech industries were basically destroyed. The destruction of entire industries was accompanied by talk about the "unprofitability of such production." In particular, Russia has practically lost the ability to produce microchips, especially complex ones, such as computer chips, we have big problems with the production of high-alloy steels, the capacity for the production of especially heat-resistant carbon-based materials has been eliminated, and much more.
In the extractive industry, things were somewhat better due to the fact that our resources were needed by the West and other foreign consumers. However, even here the situation is not so good. The exploitation of enterprises of the extractive industry and natural resources of the country has been and is being carried out predationally. Additional funds for the development of production and exploration of mineral deposits are either not allocated at all, or they go to a minimum amount. According to the Ministry of Natural Resources, since 1990, the volume of exploration drilling has decreased fourfold, and the rate of increase in proven oil reserves has decreased 6.5 times. Losses of extracted reserves are growing. The mineral resource base of other minerals has significantly decreased. Thus, the proven reserves of tin and lead decreased by 50 and 30 percent, respectively. Used reserves of iron ores, copper, zinc decreased by 68-78 percent, nickel, bauxite, titanium and apatite - by 60-68 percent.
The owners do not support the subsurface exploration system. In the USSR, such a system included about 50 research institutes, more than 60 NGOs, about 30 plants for the production of geophysical, drilling and other equipment. Today, only a shadow remains of this once powerful system. Having been reduced several times, it has largely lost the ability to solve the tasks assigned to it.
Huge budget funds will have to be allocated for the revival of destroyed industries. However, it is quite obvious that their investment in the private sector is inefficient and extremely unfair, since this will actually mean enriching a small number of private owners by transferring public funds to them. And even if these funds go to the real restoration of destroyed industries, which there are real doubts about, it will mean the personal enrichment of the oligarchs at the expense of the state budget.
In addition, there are no guarantees that having received these funds, they will be able to revive the most complex productions. Private owners of previously powerful and efficient state-owned enterprises have already destroyed them once, turning them into various secondary objects such as warehouses, office centers and other malls. The new owners, having acquired the enterprises, could not dispose of them simply because they did not have the appropriate training for this. It was easier for them to close production and lease the vacant space. Additional financial injections to the same people will not give anything – they simply will not be able to organize the revival of complex industries. So such investments are obviously inefficient, and at the same time unfair, since it is impossible to direct public money to enrich individuals.
The experience of owning our strategic industries by private owners proves that they are unable to manage such a complex and high-tech economy.
Another important factor determining the inefficiency of a private owner in such a large-scale national business as the revival of the country's economic potential is the fundamental contradiction between the goal-setting of a private owner and the objective need to focus efforts on the development of a complex of various industries and the reconstruction of many scientific areas.
The main goal of a private owner is to extract maximum profit. The interests of the development of the entire economic complex are secondary for him. If he thinks about them, it is only in the context of increasing his income again.
As the experience of post-Soviet Russia shows, large owners for the most part have never really thought about the development or even preservation of the industrial potential of the country as a whole. For example, 45 percent of the extracted oil, 33 percent of gas, 34 percent of petroleum products, up to 90-99 percent of the total volume of copper, nickel and aluminum produced in the country are exported abroad. And this is understandable – you can make more profit abroad than by selling these resources to Russian consumers. And the funds received directly settle in foreign banks, bypassing Russian ones. If the state forces them to sell part of the resources in their own country, they, striving for maximum profit, ensure that energy prices in Russia become the same as for foreign consumers.
Meanwhile, on average, the energy intensity of our production, other things being equal, is about 2.5 times higher than that of our European and American competitors, who are in much more comfortable climatic conditions. The share of energy resources, in particular electricity, in the total cost of Russian products is 30-40 percent. That is, by setting tariffs on energy and energy carriers for Russian consumers at the level of Western ones, our raw materials oligarchy makes our high-tech industries obviously inefficient. This forms one of the most serious contradictions in our elite - the conflict between the owners of raw materials industries and the captains of high-tech industries.
Nationalization of energy industries will reduce, according to economic experts, energy consumption for domestic consumers by about half. At the same time, the profitability of production will increase by 15-20 percent.
One often hears that the nationalization of strategic resources will not give anything, in particular, the country will not receive any additional funds for priority measures to revive the economy. They say, where can they come from – after all, there will be no immediate increase in production with nationalization.
It is worth recalling here that one of the lowest raw material rents has been established in our state. Thus, the Russian state gets only 34 percent of oil revenues, while in the United Arab Emirates – 91 percent, in Norway - 82, in the United States - 60. The remaining 66 percent is spent by the owners of enterprises and their top management at their discretion. Thus, the resources that could become the basis of the country's economic breakthrough are converted into the super-profits of the Russian rich, which, judging by the state of the same extractive industry, are very unproductive. The nationalization of strategic industries will radically increase the country's budget only through the full use of profits from the extraction of natural resources.
Key threat
Many prominent experts admit that the moral damage from the privatization of the 90s has not yet been fully realized. The methods of its implementation, which sometimes had a semi-criminal nature of the appropriation of the former socialist public property, led to the fact that in the eyes of the population large private property is not legitimate. The preservation of strategic resources in private ownership creates a huge income gap between the poor and the rich, reaching an exorbitant value - according to official data, more than 16 times (according to other sources - 40), with a critically dangerous indicator of 10. This creates a serious threat to national security, forming a deep split between the elite and the bulk of the population. And this gap is being deepened to a decisive extent by the efforts of large owners. According to authoritative experts, even from the liberal elite camp, Russian society is experiencing a profound moral and psychological crisis, which determines the mood in society, generating inferiority complexes, a high degree of aggression, disunity and disrespect for property, uncertainty and lack of faith in the future.
The Russian oligarchy, using its capabilities, can provoke various problems in the economy, leading to a significant decrease in the quality of life of the population in the regions of Russia, for example, an unjustified increase in prices for essential goods, fuel and energy. And this will lead to the destabilization of the socio-political situation.
At the same time, as the experience of Ukraine shows, a large oligarchy, driven by personal ambitions and pressure from Western masters, is able to blow up the situation itself – to finance protests and their information support, up to the creation of private armies to seize political power, as, for example, Kolomoisky did at one time.
Therefore, the elimination of the economic power of the Russian oligarchy is the main tool for neutralizing the "fifth column", which our president spoke about as one of the sources of threats to Russia's national security.
So nationalization of strategic resources is a vital necessity today. Without it, not only a technological breakthrough is impossible, without which our country cannot survive, but also the neutralization of the most dangerous threats to Russia's security.
Konstantin Sivkov, Deputy President of the Russian Academy of Sciences for Information Policy, Doctor of Military Sciences
The newspaper "Military-Industrial Courier", published in issue No. 10 (923) for March 22, 2022
