Russia's Economy Is Bursting At The Seams
- 11.07.2025, 7:52
The situation is becoming alarming.
Russia and Putin have set themselves the task of definitely defeating Ukraine in 2025 and achieving an end to the war, because the economy can't take it any further. So now they will spend everything they have and produce as much as they can (and as much as they can't) to suppress Ukraine and secure such a favorable negotiating position that it can guarantee the result they want. The picture is exactly that, as the situation becomes alarming from here on out. And the fact that Putin is suddenly talking about the need to reduce military spending means that even his inner circle is complaining. As the economy starts to crack at the seams, this is a trouble they can't shrug off.
The kind of bizarre performance of people at the St. Petersburg Economic Forum, when they started talking about the problems that are plaguing the Russian economy, is exactly that. It is a kind of very quiet, maximally loyal - with emphasized respect for the "sovereign-emperor" - but still a revolt.
Putin has to take this into account: if you are betrayed by your entourage, you will not stay in power for long, or even alive. And the entourage is getting annoyed because the losses are already too great and the situation in the economy is getting too grim. Therefore, the Kremlin's only chance now is to crush Ukraine as quickly as possible, inflict serious losses on it and seize as much as possible, so that then there would be something to bargain with and sacrifice in order to achieve the decision it wants.
In my opinion, this is a kind of "psychological attack". Because Russia will no longer be able to maintain the current level of military expenditures and the degree of militarization of the economy. Then it will have to radically change the way of life in the country and move towards North Korea with the most severe restriction of freedom and consumption of the population, transferring all the money only for the war. This option is also possible, but it is an unpleasant model that Putin will try to avoid.
Igor Lipsits, "Glavred".