Vladimir Putin gives the Kuzbass working class the lowdown on the crisis
Prime Minister Vladimir Putin spent yesterday in Novokuznetsk, a city where the snow is black and mines are experiencing serious difficulties. The Government Commission on Regional Development also met for its session there, but for Mr Putin it was equally important to see with his own eyes how an industrial city was struggling amid the crisis.
Some thirty miners from Kuzbass pits were seated in a circle in the canteen of the Polosukhinskaya mine, while a revolving office chair was placed in the centre for the Prime Minister.
"Naturally, everyone is concerned about what is happening in the economy, global and Russian, and I would like to start precisely with that," said Mr Putin without waiting for questions as he entered the mess hall.
He talked non-stop for twenty or so minutes, stressing that "our economy depends on developments abroad," that "the market economy has many pluses, but also minuses," and that "the crisis came directly from the heart of the world economy - the United States".
"How deep is the crisis and when will it end?" Mr Putin asked himself. "Unfortunately, no one can give a definite answer to this, perhaps the most crucial question ..."
"So what is to be done, how should we proceed from here? - Mr Putin wondered again. "Our efforts, if they differ from those of other countries, do so for the better: they focus more on social matters."
The Prime Minister also repeated, in order for the miners to firmly grasp the fact, that "far from cutting down benefits and pensions, we are actually increasing them".
"Case in point: our anti-crisis package is bigger than in any other country," Mr Putin said. "Japan has allocated 2% of its GDP for these purposes, while our measures account for as much as 4.5% of GDP, and factoring in Central Bank efforts, even as much as 12%."
Having been updated about the crisis, the miners started asking questions of Mr Putin, who answered them while rotating in his chair to face each interlocutor in turn.
"Will miners have a decent pension?" Oleg Kolesnichenko asked first.
"In Soviet times, your pensions made up as much as 70% of the wage," Mr Putin recalled, adding that this year pensions will be indexed four, not three times as planned. "We plan to increase the percentage, but are unlikely to do so for only the miners ..."
A miner called Vladimir complained about high rail tariffs eating up practically all corporate profits.
"It is unfair to complain," Mr Putin said. "We planned to raise tariffs by 14% this year, but raised them only by 5%. To have gone lower would have been unwise and dangerous."
Vasily, Chairman of the Abashevskaya Mine Trade Union Committee, spoke of rising prices on food and everyday goods. "Unfortunately, most of our foodstuffs - and this is strange for our country - are imported," Mr Putin said. "The way out lies in developing our own farming."
"Things are not very good at our mine," said Nikolai from the Raspadskaya mine, the largest in the region.
"Not all are bad ..." Mr Putin replied, trying to smile.
"No," the miner persisted. "Output is down 70%, wages 40%, the working week is shorter, while new equipment is idle. I feel hurt. We are now working at a loss: the country's largest mine is getting down on its knees."
"You see, demand supercedes everything," Mr Putin said and described the situation in Europe: it was producing fewer machines and as a result buying less steel from Russia. "Effective demand on the world market does not depend on us."
"What is the way out then?" Nikolai pressed. "Perhaps we should build machines ourselves? Ships, factories, or tanks after all."
"We can do it," the Prime Minister agreed, adding that this year alone, state investments in construction and road building will exceed 800 billion roubles.
However, to make it all work, Mr Putin was convinced, it will be necessary to raise labour productivity, and this calls for "billions and billions".
"This cannot be done overnight," the Prime Minister summed up and, thinking a bit, added that this would be impossible to achieve even within a year.
The meeting was over. No longer grim, the miners crowded around Mr Putin, asking for autographs and a photocall session. The message was clear: things were tolerable. This was likewise the main conclusion Mr Putin took with him as he left the Polosukhinskaya mine.
The Government Commission on Regional Development dealt with practically the same issues that the miners raised in the canteen.
"I have said already that 2009 is going to be a difficult year," the Prime Minister reported. "To cope with problems, we should review budgets thoroughly and make spending more effective."
According to Mr Putin, financial aid to the regions is to grow by 300 billion roubles: 150 billion in subsidies to balance out budgets and another 150 billion in additional budget loans for up to three years.
"We should spend resources in areas important for social welfare," Mr Putin said.
Because later, if anything happened, it would be unfair to complain.
1-2 federal issue