This seminar series was sponsored by the National Intelligence Council
(NIC) and the Bureau of Intelligence and Research of the US Department
of State. The NIC routinely sponsors unclassified conferences with outside
experts to gain knowledge and insight and to sharpen the level of analysis
and debate on critical issues. The views expressed are those of individuals
and do not represent official US intelligence or policy posistions.
Executive Summary
Introduction
During the past two years, the National Intelligence Council and the
Bureau of Intelligence and Research of the US Department of State sponsored
a working group and four seminars with experts from outside the Intelligence
Community to examine the impact of societal and infrastructural factors
on Russia's future over the next two decades. The factors identified--demography,
health, intellectual capital, and physical infrastructure--all pose great
challenges to Russia. The purpose of the project was to begin to think
through in systematic fashion the difficulties and opportunities confronting
Russia's leadership in these four specific areas.
Key questions with which participants grappled included: What is the
extent of the challenge in each of these areas? What are the trends, and
to what extent are the outcomes of these trends over the next 20 years
already determined? What are the key drivers that can influence these trends?
When could government policy intervention or outside assistance be expected
to have payoff, and how costly would it be? Is there a logical sequence
of priorities for attention? What are the implications of alternate paths?
This report consists of three substantive sections. This Executive Summary
is the first; it captures the main findings of the presentations and discussions
at the seminars. The second is an essay by Marcus Noland, Senior Fellow
at the Institute of International Economics and project adviser, who explores
these themes in greater detail. The third section contains brief summaries
of the papers presented at the seminars. The agendas of the seminars and
lists of speakers follow in the appendixes.
Key Findings
Most of the challenges confronting Russia in the spheres of social and
physical infrastructure are not unique. It is the confluence of so many
challenges all at once--initiated by the abnormal existence and then the
breakup of the Soviet Union, intensified by the stormy transition in Russia
over the past decade, and then exacerbated by the collapse of the ruble
in August 1998--that makes the Russian case extreme.
Demographic Trends
Experts noted that demography is one of the most reliable factors that
can be used to make projections about a specific country. Demographics
can help answer some narrow questions--such as likely pension burdens--and
can sometimes be helpful with "middle-gauge" questions, such as future
health care costs or housing markets. Demographics generally are not reliable
or insightful for other questions, such as homicide rates or generational
conflict. In Russia's case the unique nature of the demise of the Soviet
empire may place Russia outside the normal range of historical experience,
moreover, and limit the predictive value of demographics.
Experts agreed that the combination of high Russian mortality rates
and low birth rates will affect Russia profoundly in the coming decades.
* High mortality rates are affecting all segments of the population.
Russian statistics show that by 1999 life expectancy for men had fallen
to 59.8 years, from a high of 64.3 in 1966 and to 72.2, from 74.2 in 1990
for women. The current mortality figures do not yet reflect the impact
of the spread of AIDS and the rise in number of cases of infectious disease,
including those of multiple drug-resistant tuberculosis.
* The causes of early mortality are numerous, and include high rates
of suicide, childhood injuries, alcoholism, infectious diseases, cardiovascular
disease, and cancer. Some trends result from the reduction of the state's
involvement and the absence of private structures to replace it, especially
investment in medical technologies and drugs. Many health problems are
the result of a health care focus on communicable diseases and nutrition
without corresponding attention to prevention of chronic diseases.
Experts disagreed as to whether economic improvement--which could bring
enhanced nutrition, better water supply, and a reduction in crowded living
conditions--would be sufficient to reverse negative health and demographic
trends.
* Russia is following the general European downward trend with regard
to fertility. Overall, Russia's total fertility rate stands at 1.17, and
some believe that it can reach as low as 1.0--well below replacement level
of 2.14. All agreed that it will not rise higher than 1.5 over the next
20 years. Russia's abortion rate remains extremely high, and noted demographer
Murray Feshbach claims that thirty percent of Russian women of childbearing
age are infertile.
Internally, population growth among Islamic peoples of Russia, many
concentrated in Russia's south, continues to outpace that of ethnic Russians,
while Northern and Far Eastern regions are slowly being depopulated as
state-owned industries close and people move to European Russia. As a factor
in population growth, immigration has outweighed emigration since the breakup
of the former Soviet Union; barring civil wars or other disasters in the
near abroad, it has probably peaked. By 2020, Russia's population is most
likely to be smaller--according to Feshbach, it is very likely to decline
from 146 million to 130 million in this timeframe--and with a higher median
age than today's. Russia's State Committee for Statistics recently forecast
that the population will shrink to 134 million by 2015. As Russia's population
ages, an increase in the dependency ratio is certain: by 2015 the ratio
will be just four workers for every three nonworkers, with a dramatic shift
among the nonworking population toward the elderly. The aging of the population
and the increase in the dependency ratio suggest that domestic public and
private capital available to refinance new investments may decline over
the next two decades, underscoring and increasing the importance of creating
the necessary conditions to attract investment from abroad. Among Russia's
labor force, unemployment as a result of economic decline hashit the female
work force disproportionately. This increasingly unused resource could
compensate for Russia's dwindling number of males, should a Russian economic
recovery require additional labor.
Seminar participants saw both positive and negative implications of
Russia's declining population.
* A smaller, younger population means fewer nonworkers to support and
a reduced demand for daycare and health care. At the same time, however,
Russia will have to go through its structural transition in the context
of an aging, and likely less productive, population. A smaller work force
could result in a labor shortage, even if the potential female labor force
were fully employed.
* From a military manpower perspective, Russia--which already lost much
of its mobilization base with the independence of the former Soviet republics--will
find it increasingly difficult to generate and deploy the large conventional
forces it has historically relied upon to defend its borders. The manpower
shortage will contribute to Russia's increasing reliance on its nuclear
deterrent.
* Internal migration will result in changing regional dynamics and possibly
in the concentration of the Russian population into a smaller number of
regions. The population of some regions, such as the Far North, will most
likely decline further as the Russian Government no longer continues to
bear the high cost of maintaining infrastructure in areas where the economic
base is not largely self sustaining. In the increasingly depopulated Far
East, Moscow's concern about the security implications of Chinese in-migration
will heighten.
Health Trends
Another factor influencing Russia's future demographic path for the
worse--possibly making today's grim predictions appear optimistic--is the
Russian health crisis. Seminar participants agreed that the list of Russia's
health woes is extensive: continuing high rates of alcohol abuse with a
resulting abundance of new fetal alcohol syndrome cases; pharmaceutical
shortages; poor reproductive health and continuing high rates of abortion;
rising rates of infertility; high rates of sexually transmitted diseases;
cardiovascular diseases; anemia; poisoning from heavy metals and other
toxic materials; environmentally associated cancers; high rates of injury;
and malnutrition. One speaker pointed to the toll on health resulting from
growing inequality in Russian society and associated stress, deprivation,
and breakdown in social cohesion; another, however, warned of the methodological
difficulty of differentiating causality from correlation in assessing the
root of some health problems.
Experts noted that infectious diseases with the potential to spread
beyond Russia's borders are growing rapidly.
* The rate of infection of tuberculosis has grown from 24 new cases
per 100,000 in 1990 to 83 in 1998--as compared to 6.8 per 100,000 in the
United States. Shortage of medicines and inadequate or outmoded standards
of care result in antibiotic treatments of shorter-than-necessary duration
and the increasing incidence of multiple drug-resistant strains.
* While registered cases of HIV have grown to some 53,000, estimates
by Russian experts of the real incidence range from 10 to 100 times as
many. Russia's medical establishment is badly positioned to cope with the
challenges it faces. It is still overcentralized, overspecialized, hierarchical,
and strongly shaped by the beliefs and practices of the Soviet era. Health
expenditures are treated as a residual claimant on the Russian budget,
a problem compounded by the inefficiency of Russian health care delivery.
"Therapeutic anarchy" and a reliance on what one speaker euphemistically
called "non-evidentiary-based medicine" are widespread. Most key decisionmakers
in Russian medicine have strongly resisted change and Western advice, even
when practitioners accepted such advice, they have lacked the organizational
capacity and resources to carry through on treatments, as in the case of
tuberculosis.
Russia's economic crisis has exacerbated many of the health problems.
Shortage of resources has led to cuts in health spending and low salaries
only irregularly paid to health-care workers, whose morale has plummeted.
Russia's experiment with a medical insurance scheme has met with uneven
success to date, although it has succeeded in keeping the decline in health
expenditures to a lower rate than that experienced by other sectors such
as education and culture. In addition, frequent bureaucratic shakeups have
resulted in eight different health ministers since 1995, making consistent
policy difficult to sustain.
A few seminar participants thought that a new generation of medical
leaders will be more open to change. The majority, however, appeared unconvinced
that an attitudinal shift could take place with sufficient magnitude and
speed to prevent a serious deterioration in Russia's already abysmal health
picture.
Finally, experts agreed that the trends in Russian health are of significance
not simply for their negative demographic ramifications, but also for their
probable strong negative impact on the future productivity of Russia's
work force and its overall quality of life.
Trends in Intellectual Capital
Experts agreed that Russian intellectual capital is under a high degree
of stress.
* Many contended that the bureaucracies responsible for its promotion--the
Academy of Sciences, the Ministry of Education, etc.—are highly resistant
to much-needed reform.
* Russia's schools have deteriorated significantly, and many lack teachers
in basic subject areas, especially in the poorer regions.
* Russia's science and technology base--greatly shrunken from the oversized
Soviet complex but not disproportionate to Russia's present size--is inadequately
funded and not attracting sufficient new talent.
* Russia has been losing significant expertise to a "brain drain" for
over a decade.
Significant recent growth in some forms of education will prove critical
to Russia's emerging market economy. Enrollment in newly created business
schools and management training courses is thriving and could result in
significant future payoff. In addition, the growth of the Internet and
global communications has provided new opportunities for more effectively
organizing education across Russia's wide expanses as well as for absorbing
knowledge from abroad. Recent tightening of controls over information flows--such
as media, publications, and computer mail--raise questions, however, about
Russia's future ability to benefit from greater interchange with other
countries.
Russia's ability to recover from the damage to its intellectual capital
during the last decade will play a key role in its ability to compete in
future world markets. Given that the majority of Russians who will be in
the labor force for the next two decades have already received their formal
education or will soon do so, many changes in educational policy today
are likely to bear fruit only at a later date. Some experts argue, however,
that the educational system is not a leading indicator of change and not
the place to start. Globalization presents other paths to technological
success through adaptation rather than innovation, and improvements in
education tend to follow naturally upon economic growth.
Trends in Physical Infrastructure
Russia's physical infrastructure reflects the legacy of Soviet-era priorities
and relative Soviet autarky, ensuring that the transition to a new, more
globalized economy will be difficult. Although assessments vary, many experts
believe that a large proportion of Russian capital stock will have to be
written off over the next decade. Investments have been made in industries
in which Russia is unlikely to ever be internationally competitive, either
because of poor quality or because the capital stock embodies technologies
incompatible with international standards. Considerable capital has been
invested in remote regions where neither the government nor private industry
is likely to provide funds for upkeep or modernization. Demonetization,
lack of institutional capacity, and inadequate property rights protection
discourage investment in both public and private spheres.
The picture is mixed, however. In industry, some studies, such as that
by McKinsey Associates, have found the potential for productivity improvement
in many sectors. In housing, privatization appears to have given a boost
to new construction, although the 1998 financial crisis interrupted this
trend. In the transport sector, the extensive shakeout of Soviet-era bureaucracies,
enterprises, and infrastructure that has taken place and is still occurring
was necessary, but the potential for new companies to find new niches also
seems high, if economic recovery continues.
Conclusions
Participants found that while the impact of certain trends, such as
worsening demographics, is largely unavoidable for the next two decades,
the Russian Government does have the capability, if not yet the demonstrated
determination, to reverse or slow other negative trends in this timeframe.
In some cases, timely action is required to prevent long-term adverse consequences.
For instance, public policy decisions and directed resource flows could
make a difference in education and health. Regional policy—from the center
or decided locally--can also have great impact, and, together with other
factors such as geography and resource wealth, could serve as a magnet
to concentrate Russia's population into a smaller number of "winner" regions.
And as with most other problems in Russia, the new leadership's ability
to establish a predictable legal and fiscal environment—essential for ensuring
economic stability, attracting private investment, and ultimately, stimulating
economic growth--would increase Russia's ability to reverse many of these
negative trends.
-
ко-мент
-
Russia's
Infrastructure на неЦРУшном сервере (если
линк не работает воспользуётесь поиском на сервере ЦРУ. стринг для поиска:
russian mortality)