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Knights of the Vine RUSSIA

The Way It Is

The Art of Poverty, Russian Style
Cameras, glossy magazines and TV love the rich and famous. No wonder we know an awful lot about the Russian “new rich”. We know a lot less about the “new Russian poor”. Who are they? What does the notion of being poor in today’s Russia actually mean? How do sociologists assess poverty and what are the distinctive national traits of poverty?
Elena Rubinova

The number of billionaires in Russia has doubled over the last year according to the annual Forbes list. The Russian capital has more of them than New York—out of 101 Russian multi-millionaires listed, 79 live in Moscow. But the super-rich aside, it has been recently stated by researchers and experts that Russia has achieved very good results in the struggle with poverty. The situation among the most vulnerable layers of the population—children and the elderly—has improved immensely, so the experts say.

Even the economic crisis of 2008 did not erase the picture of a well-off country. Experts of the Higher School of Economics who recently unveiled the results of the Russia Longitudinal Monitoring Survey (RLMS), a series of nationally-representative surveys, said in their latest report that the number of households with an income below the poverty line in Russia dropped from 38%-3% from 1998-2009. Three per cent is the lowest index reported during the entire period of observations. But have Russians really become as affluent as it is pictured?

Who is considered poor?

If a pensioner in Moscow gets a tiny pension, but owns some real estate worth $200,000 is he or she rich or poor? Is a rural dweller poor if he owns a plot of land with a farmhouse but has to live on a nugatory wage? What about young mothers who are out of work but could work if there were child-care facilities? Are they poor? What exactly is the poverty line—the cost of living that ensures only physical survival or a more or less decent existence?

The most advanced approach to poverty assessment is based on an assessment of all resources for a family or individual as opposed to taking in consideration only monetary income. Yet in many countries, including Russia, the poverty line is measured by minimal survival level, the subsistence minimum, which is based on the price of a minimum of goods needed to keep you alive. Those whose income is under this figure, who cannot satisfy basic needs are officially considered poor. Russia is huge, and regional disparities in living standards cannot be neglected. The subsistence minimum is calculated by Rosstat, the official state statistics body. For each region of the country every year, last time in 2010. The figure ranges from 5000-8000 roubles across Russia depending on the region and category of the population (children, pensioners or adults). Some experts call this figure “a misery level”, “because it’s virtually impossible to even physically survive on this money.

According to Rosstat in July 2010 approximately 14% (20. 6 million people) still live below the poverty line. It means that every 8th citizen does not earn even the regional survival minimum. The situation is even less radiant if we look at the results presented in 2010 by the All-Russian Centre for Living Standards. This think tank diversifies the degrees of poverty and groups of the population according to a per-capita monthly income: extremely poor (below the official poverty line of around 5000 roubles), poor (1-3 times the subsistence minimums not exceeding 15000 roubles) and relatively poor or badly off whose income accounts to 3-7 subsistence minimums accounting to approximately 15000-35000 roubles), a level that by western standards, would still represent poverty.

Vyacheslav Bobkov, director of the All-Russian Centre for Living Standards says that in his estimation “two thirds of the Russian population are near the physical survival level. Thus 90% of the country’s population does not even approach the criteria of the middle class”. Earlier this year, an opinion poll was conducted by the Levada Centre, Russia’s leading independent sociological institute. 1600 people in 45 regions of Russia were questioned. When asked “what do you consider the most pressing problem for Russian society?”, 59 % of polled named poverty and drop of income as their main problem. 81% named inflation as issue number one.

The “new poor” and “traditionally poor”

Officially in Soviet Russia, poverty as a self-generating and persistent social phenomenon did not exist. Or rather, it was claimed to have been totally eradicated as the result of the planned economy: standards of living were

ascetic and minimal, wealth more or less equally distributed. Even if an average citizen got poorer, it was a statistical and temporary predicament. Karl Marx would have been delighted to see the situation best characterized as “equality in poverty,” at least, in the years of late socialism. One should not be misled and think that in those years there were no people who lacked material wealth. They were called “nuzdaushiesa” (“people in need” or “with low level of well-being ”) and stood for such categories as large and single mother families, the disabled, pensioners, mostly women, living on a social security pension because of lack of a work record. Later on those groups would be referred to as “traditionally poor” when a phenomenon of “new poverty” emerged in Russia as a result of the liberal reforms of the 1990s. At this time, civil servants and white-collar workers employed in education, medicine and other non-manual industries as well as industrial workers protected in Soviet times experienced prolonged downward mobility and a radical loss in status.

Poverty Profile in Brief

Unlike many Asian or African countries where poverty is a surface phenomenon and very evident, in post-Soviet Russia it’s very covert. If one visits a provincial medium-sized Russian town today, you won’t see slums, barefooted crowds of children in rags, even fewer beggars. Рoverty camouflages itself in the “well-off” Russia of the 21st century, but economists and sociologists are univocal in their assessments.

The majority of the “new poor” in Russia are to be found among working families headed by adults with average technical and professional training, and in families with children, the largest sub-group of the working poor. Most of the working poor are employed in the public sector, including teachers, physicians and low-ranking civil servants. Traditionally poor categories—primarily large families, the disabled, the homeless, the single elderly living alone, mostly women, are still in the poverty picture, but it’s the working poor who keep poverty statistics high. The “new poor” in post-socialist Russia are mostly long-term poor with low standards of living, lacking material assets, cultural and social capital. They are able-bodied people employed in unstable jobs and often excluded from the system of social support.

According to Svetlana Yaroshenko, associate professor at the Department of Comparative Sociology, St. Petersburg State University, “Long-term exclusion from generally accepted standards and discrimination because of age, gender, employment opportunities and other factors results in accumulation of poverty that often leads to isolation and gradual exclusion from society.” Extended case studies conveyed in the Komi Republic by Svetlana Yaroshenko and her colleagues from the Institute of Social and Economic Problems of the North, span from 1998-2008. They clearly show trends in Russian poverty over the past decades. Some are similar to other Eastern-European countries that went through economic transformations, some vividly demonstrate specific national traits of poverty in Russia.

National traits of poverty

First of all, poverty is widespread on the vast territory of Russia. It’s true that since early 2000, economic growth has resulted in the slow reduction of the number of poor people, but it’s still high. Between 8% and 35% of Russians have an income lower than the subsistence minimum.

Secondly, in the years of transition, especially in the 1990s, poverty affected previously secure social strata. Economically active people who were protected by the state but for a long time (10-15 years) experienced sustained downward mobility and employment insecurity. Svetlana Yaroshenko also claims that another peculiar trait of poverty in modern Russia is “the threat of permanent poverty passed down from generation to generation, a high degree of social imparity that is caused not only by low income, but by a very limited access to basic medical services, quality education and living conditions regarded as standard.” It is even possible to speak about a “culture of poverty” when a person is influenced by a poor environment and lifestyle for generations, and is not aware of other lifestyles. In this regard, Soviet habits of living in austerity and a typical Russian mind-set of the older generation to tolerate anything played a negative role. When “the new poor” suffer from downward mobility, there is no tradition of defending individual rights, and in this regard, “the situation in Russia is close to that in Bulgaria or Romania,” commented Svetlana Yaroshenko.

Another distinctive feature for Russia is the ruralisation of poverty. In contrast to western countries, where poverty is often concentrated in the large cities, the poor are more frequently found in Russia’s villages and towns.

And finally, poverty in Russia has a clear gender dimension: it has a female face. On average, women are paid 36% less than men and in general in the course of economic transformations, women were marginalized into disadvantaged positions. At certain times in the past decades, women on average represented two-thirds of the unemployed.

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