Posted on 07/30/2002 9:26:53 AM PDT by aculeus
There’s a saying about new technology: that it is overestimated in the short run, but underestimated in the long run. The same may be true of countries like Russia.
The red flag went down over the Kremlin on Christmas Day 1991, and by the end of that month, the USSR had vanished. There were high hopes in the West, but lawlessness, moral decay, and economic collapse followed. In 1998, Russia defaulted on its debt, creating an international financial crisis. Since then, most of the world has paid little attention to Russia, figuring that it would remain an economic backwater.
Instead, Russia is reviving. Gross domestic product grew 8 percent in 2000 and 5 percent in 2001. Its stock market was the most fervent in the world last year, and rose 48 percent (in dollar terms) during the first four months of this year. Inflation and interest rates are still high, and Russia owes foreign lenders $40 billion. But as a banker at a business conference in London recently put it, “The fundamentals of the Russian economy are pretty sound.”
Why? President Vladimir Putin has realized that Russia has to create a friendly environment for business. He’s made changes in the legal system to make it more reliable and fair, and he has emerged as the world’s leading advocate of lower taxes, putting even George W. Bush to shame.
At the beginning of last year, Russia adopted a 13 percent flat tax on personal income. There’s no capital gains tax on stocks, bonds, or home sales. Interest on government bonds is exempt from taxes, and corporate dividends are taxed only once.
The lower rate, limited deductions, and simpler system have produced higher tax revenues (as supply siders predict). Vastly higher. Preliminary data show that 2001’s lower flat tax rate raised 28 percent more revenue—after adjusting for inflation—than the higher graduated rates raised the year before. Russia now has a budget surplus. Starting in 2002, Russia also cut the corporate tax from 35 percent to 24 percent, and Putin has proposed giving small businesses a choice of either paying an 8 percent flat tax on their revenues or a 20 percent flat tax on their profits. The Russians now have the best tax system in Europe, and are showing us all the path to a better way of raising revenues.
Putin has also become the world’s most articulate spokesman for free markets and smaller government. White House speechwriters should study his April 18 State of the Nation address—ignored by the world press—as a model of clarity, candor, and intelligence. The translation probably doesn’t do these passages justice as rhetoric, but they are impressive as ideas:
On self-reliance: “Competition has now assumed a genuinely global character…. The main thing now is to create conditions in which the citizens of Russia can earn money and, while deriving advantage for themselves, invest it in the economy of their own country…. At the moment, the country’s colossal potential is being blocked by a cumbersome, inflexible, and ineffective state apparatus.”
On the legal system: “We need courts which are respected both inside and outside this country. This is not just a political task; it is very much an economic one…. An efficient court system is essential so that both Russian and foreign companies can have no doubts about its authority and effectiveness.”
On trade: “I would like to point out that the WTO is not an absolute evil, nor an absolute good. It is not a reward for good behavior. The WTO is a tool. Those who know how to use it become stronger.”
On technology: “We need to help Russian developers join the world venture market, the capital market, which ensures efficiency in the sales of scientific products and services…. Conditions should be created for the healthy commercialization of applied science, and one of the ways is to set up joint ventures, both in Russia and abroad.”
On being world-class: “Best practices worldwide [are] a most important criterion of success—best practices in everything…. We must make Russia a prosperous and affluent country, so that living here is comfortable and safe, so that people can work freely, earn a living for themselves and their children, without restriction, so that they aspire to come to Russia, rather than leave it.”
All this from the president of Russia in the year 2002. Just a dozen years ago, who would have believed it?
Who'd thunk it?
The Pubbies should run on this.
Amen.
"And a final part of Solzhenitsyn's message to us: What has happened in Russia is coming to the West. America and the free West must also face this universal anti-Christian phenomenon of state atheism and its Gulag. This is the message Solzhenitsyn has given in his American addresses, such as that at the Harvard commencement in 1978, where he castigated America for its loss of will, its love of pleasure, its satisfaction with legalism in human relations. Let me quote here a few passages from another address he gave in 1975, before the meeting of the AFL-CIO in New York City:
"Is it possible or impossible to transmit the experience of those who have suffered to those who have yet to suffer? Can one part of humanity learn from the bitter experience of another or can it not? Is it possible or impossible to warn someone of danger?… The proud skyscrapers stand on, point to the sky and say: it will never happen here. This will never come to us. It's not possible here…...
You're not alone in that respect at all, but you better get your money offshore soon. Seems like Fortress Amerika is coming and they will lock down your cash better than they are already doing.
I am one of the people to whom you sent the above post. As an Atheist, I bear absolutely no resemblance to a communist. While the Soviet Union was indeed "anti-theist", atheism and communism are not synonymous terms. Communism requires a totalitarian government to seize private property and redistribute wealth. Contrary to popular opinion, those socialist ideas like equality are Christian (not atheist) ideals. Atheism is geared toward individuality and capitalism. So, it's funny to see the above person lament America's "love of pleasure" and "satisfaction with legalism" and then claim to be anti-communist, when it's communism that controls and squashes those things, not capitalism.
Russia seems to be passing us in its love for freedom. Whether or not the leader is atheist or Christian doesn't matter to me. I wouldn't want to live under an "anti-theist" government, and I wouldn't want to live under an "anti-atheist" government, either. Both are totalitarian governments.
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