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Saturday, March 24, 2018

Sociologist: Russia has fallen into the trap of “decent poverty”

Despite spells of the authorities, the economic crisis in the country hurts the pockets of the Russians. “No money”, “can’t afford it”, “how to live?” — these words you hear more often.

How do you feel now the Russians are consuming and what it all may lead, “MK” talked to candidate of economic Sciences, head of the Department of the study of living standards, income and consumption of the population “Levada-Center” Marina Krasilnikova. * * *

photo: Gennady Cherkasov

— When did this crisis, there were different predictions about how soon a fridge to win a TV and there will be social tensions. While it is not. Why?

— The question of why in the deteriorating economic situation is not visible growing social discontent, in the last year and a half journalists ask experts, and the experts themselves.

I’ll have more to say on the socio-economic causes of the situation, but I can not say about the causes of the socio-political. To ensure that the dissatisfaction emerged and manifested itself in civilized democratic forms should be leaders of public opinion with an alternative program that is supported more or less wide layers of the population. But in our political field is now a shortage of other points of view, enjoying mass support.

– How did the crisis impact on social well-being of Russians?

– 77% agree that Russia’s economic crisis is. Last year the mass consumer finally realized that he for a long time, in contrast to the crises of 1998 and 2008, and started to get used to the idea.

In February 2015, 21% answered that changes in the economic situation of the country has affected their family very much, in June 2016, such was 30%.

People EN masse refuse to purchase, more than half say about the deterioration of daily consumption for the last year: “deteriorated slightly” it’s at 45%, “considerably worsened” at 14%, they say only 6%.

The Russians noticed the reduced range of products. 37% say that don’t know what will happen to them in the next few months…

Positive is the recent slight decline in inflation expectations. According to the June poll, 78% say that over the past year prices have risen more than half, and in April the answer was given by 69%. It is understandable that people always overestimate the price increase, because I do not think about the goods they are not buying and prices are less likely to grow just on those goods that are rarely purchased…

— When people say that the crisis for a long time, just how long they believe we should tolerate?

– A year and a half or less — so thinks 20%. At least 2 years — 23%. The crisis is very long, its effects will manifest themselves for many years — 21%. It is difficult to say how long it will last and how deep will be 26%.

Nearly four out of five those words say that the crisis will last more than two years. And when you consider that two-thirds of the population, despite all the improvements of the last decade, quite poor, aren’t the norm for them the current economic difficulties?

Chronic poverty and pessimism about the prospects lead to social apathy and the internal anger.

Yes, social apathy is growing very strongly. But why should it have to cause internal anger? It may, of course, cause, but the question is how this anger to channel, and the last two years it has been successfully channeled outside.

Why the rich behave like the poor

— Reaction of our society on the crisis — the same as in other countries in similar circumstances?

— The response to the crisis of our customers is a reaction to the crisis of the poor, which is very limited in its independence and because of their standard of living really has little to do itself. And not used to doing something itself.

It objectively cannot do anything itself?

— A large part of the population really can’t objectively afford to solve the housing problem, no money, so the housing market does not develop. People can’t afford quality education on a large scale, get one that is, and it is rapidly devalued. People in most cases can’t afford to pay for treatment, and free restricted more and more.

But, on the other hand, people have no skills of solving these problems! And here we fall into the trap of poor behavior, when even if the money is there, people instead think about long-term issues and begin to form on their resources, all spending on current consumption.

This behavioural response is compounded by the fact that the financial market in our country is primitive and small. You can, of course, blame the population of the country in financial literacy, but from my point of view, the level of financial literacy we have is consistent with the level of financial market development. Banks mostly offer only Deposit and more complex financial instruments to normal people available. So all the talk about the fact that the population itself should accumulate pensions until, that is, in favor of the poor.

But such a society is easier to manage!

Is the situation that in the medium term sustainable and effective supports centralized power. I would call it “decent poverty.” When people are not starving, unable to meet their current needs, but it is not able to meet the needs of long-term and refuse to even think about them — they are completely dependent on the government.

But the possibility of the authorities to solve the problems of dependent population is declining. “There’s no money but you keep” — it’s a formula worthy of poverty.

— There is never enough money. And everything costs money. Actually building a normal financial market, creating conditions where people will be able to raise the level of their independence is too expensive, and we can only guess about which strategies less costly. It may well be that the strategy of maintaining a “decent poverty” — the most economical. But in any case it is shortsighted, because it gives development. If you do not teach people to solve their own problems — a road to a dead end.

As the Russians fell into the trap

— There is a feeling that lately the Russians have become more sensitive to sharp property stratification, which is relatively calm perceived in the years of prosperity…

(Help “MK”: “One of the indicators characterizing the level of property stratification in society, is the so-called decile ratio. The entire population is divided into 10 groups of 10 percent, depending on income level. And then calculates the ratio of total revenues to 10 percent of richest population to the total income of the poorest 10 percent of the population. In Russia this ratio is very high: from 1994 to 2013 it increased from 4.5 to 16.5 and below 16 since then, no drops”).

Surveys show that even during the prosperous zero in the ranking of the problems the Russians were leading the price growth, low living standards and the stratification between rich and poor. Yet amid all this, the standard of living rose steadily, people grumbled, but gradually accumulated to satisfy the pending needs.

Over a period of less than ten years, real income free of inflation, increased by almost 4 times. This unprecedented growth! But from the point of view of filling the standard of living of the new consumer opportunities changes over the same period was much more modest.

First, it maintained a very high level of differentiation between rich and poor, and to poor people significantly changed their consumption, he had to substantially increase your income. The threshold that we must cross, was too high.

And secondly- during this period, our society has just begun the process of social stratification (the division into layers differing from each other by a certain set of values and behavioral signs expressing social status. — “MK”).

Consumer behavior has remained more or less the same in most, little differed depending on the level of income, because when people have no other samples of consumer behavior under increasing income, they reproduce familiar patterns. And they are accustomed to the models of consumer behavior of the poor type.

— Used in the 90-ies?

— In the early 90-ies there has been a significant deterioration in the financial situation of most Russian families, and then the question, which was the topic of physical hunger was not abstract. The fact that they have now become abstract, is a great achievement…

Besides, we must not forget that in 90-e years have come from entirely different economic system where the role of the consumer as an economic unit that independently makes decisions about their income was very limited. Health, education, housing — all of this was bought and not sold…

— Housing cooperatives?

— Yes, there were cooperatives. And in medicine — private dental offices. But this is a tiny fraction of the total volume of services provided. Even buying a car in greater extent depended on the social status of the person who wants to buy it than the amount of money. There existed a black market, but these were of marginal areas. Model the consumer took himself only two solutions: about food, about clothing. This type of behavior is a poor man with enough money only for food and clothing.

— That is, even those who were not really poor, behaved as poor because the system in the USSR was arranged?

— They behaved as poor in terms of the market economy. And income growth that happened in the zero years, was not enough to solve these social problems. And time is not enough, although the processes of stratification by type of consumer behavior, it was very intense: people with substantially different income levels began to behave as shoppers in different ways, varying models of consumer behavior, and it became obvious-it is visible, that is visible to the eyes. The process was stopped by the 2008 crisis.

Should I look for in Russia the middle class?

– When we talk about stratification, division on what grounds do you mean?

– There are different models of stratification — one of them involves the division between the poor, working class, middle class, high society.

We have the last 15 or 20 years ago were actively looking for the middle class. I have always believed that it is too early to talk about it, because the concept of “middle class” is inseparable from a certain type of society that lives by the democratic rules of respect for the law and freedom of choice.

— Bourgeois society?

– Including. And we have nothing like this. There is a middle-income segments of the population, which itself in the consumer market are in large part poor, so even for marketers who are interested in promoting their products, the concept of the middle class in relation to Russia does not work.

When I said that in the Russian society, something began to take shape, I was referring to consumer behavior, and this is just one element of social stratification. It, in my view, in addition to the economic dimension, there is also the ideological and political dimensions. Here are signs of increasing diversity, I do not see at all.

— That is, people may behave differently in the consumer market, but this does not affect their political views?

— Yes, or effect, but very weakly. Here it is considered that in the demonstrations of 2011-2012 went generally affluent segments of society, but it is a stretch. There were a lot of highly educated people — Yes.

– How to distinguish a person, who in his consumer evolution has entered the next stage?

If he began to get more and a half times, went and got the money expensive suit, he still behaves like the poor, and if they have the money their children send to study, learn English, and go to the gym — not anymore?

Such markers exist and are changing in the world as in a particular country and society is increasing the level of well-being.

Against the “consumer society”, which in the Soviet time, a lot of bad was said, in Europe began to rebel in the late 60’s-early 70-ies, when, after the Second world recovered the standard of living. Suddenly it was discovered that this model, when people have to eat, dress well, and thus find their social status, a certain number of young men considered a poor marker of social status. In the end, there was a change token, and to confirm their social status, had to be longer to dress….

And charity, to adopt children…

And still play sports, some kind of intellectual activity… By the end of the twentieth century this another marker began to spread that even influenced women’s fashion — it firmly established sporty style. Switch to meeting the needs that contribute to the development of human capital, because it is not physical labor becomes the main source of wealth of society, and intellectual.

Sow the Russians lawns potatoes?

— It is believed that Russian with their generous nature is still in the scope of pens. Merchants once drowned a hundred-ruble note the fireplaces, and our contemporaries behave sometimes in the same style. Maybe it’s not the accumulated instincts of the poor behavior, and genotype?

Nothing unusual in the behavior of the Russian consumer no. I want to remind you that the word “Nouveau riche” was born not here, but in French society, but only a very long time…

— So, we just before the revolution of 1917 and the beginning of the 90s did not have time to go through the path that had to be made to the show-off became something marginal?

— As-that in interview one of our Russian billionaire said that was the moment when he found out that there are suits from Brioni, and a few years bought only these. But then, he says, is gone…

— This are all. (All in a General sense, of course, there are plenty of people who will not pass this way ever.) As soon as society will be not ashamed to dress shabbily, but to save money on learning English, there will be a transition to a new model of consumption. And what is now “poorly dressed”?

— So we are normal country just like anyone else. Catching up. There’s always leaders and there are those who are hot on their heels. And those who stop, they don’t stop actually, and go back.

— We have a stratification process just frozen or we have gone back?

— I think there’s still some backlash, the stock, which will allow people to start reproducing the old models of consumer behavior, but it is rapidly fading away.

And still zero years managed to happen important changes. We gradually began to move away from self sufficiency, from self-consumption.

— Ceased to sew yourself skirts, knit sweaters, to get a haircut at home?

The most obvious change is that the people of the garden beds dug on the lawn. And yet, despite all the talk, we don’t see mass desire again to plant potatoes.

— Desire is one thing, but the ability to live without it — more!

Until that happens, but if the next agricultural season will not change anything — may happen. With the services it already has. People in the zero years began to actively spend money on vacation. And who felt primarily on the effects of the crisis? The field of recreation and food service… Another thing is that the large spending on recreation and entertainment could afford and in the best years, about a third of consumers, and two-thirds still lived very modestly.

And in a crisis for them, but nothing much has changed?

Here is just the root of why social trauma from the loss of income is not so great — did not have time to form new rules! Person very difficult to refuse from the norm, and while it is not formed, to abandon it relatively easy.

— “Not lived well, there was nothing to start?

— Yeah, not so traumatic.

Shopping — the engine of progress

— On a site “Levada-the Centre” says that the index of social mood, which you are measuring, is very important because “changes in attitudes over several months indicate possible changes in the economic development of the country.” That is, if people expect good, then it happens?

Is the so – called self-fulfilling prophecy. How it works, it is easier to explain with an example index of consumer sentiment.

I built an econometric model that calculates the degree of influence of various factors on purchase people. It turned out that if the income level remains unchanged, while consumer sentiment improved by 1%, the turnover increases by about 0.2% simply because people have the idea that now is the time to buy. And turnover, for example, in June better explain consumer sentiment not June, and the mood of the April or March…

At the household level, it is clear why this is so: if a person thinks that he will increase the income in 2 months, today he goes and buys.

But he thinks, based on real facts, or just like air it’s worn?

— First of all, no matter based on what he thinks. But if all the buyers think that they have tomorrow’s income will increase, go to the store and buy, sellers get additional income and with it also go to the store and something to buy, and thereby unwinds the economy… And secondly, when we ask people about their everyday life, they respond primarily based on their personal experience.

— Can the power to affect improvement in consumer sentiment?

– Yes, if the actions of the authorities will lead to real improvement of the economic situation. Some statements and promises is insufficient in this case.

Public opinion depends on media. If we are talking about international politics — this dependence is relatively high, because where society knows how things are there really? But if we are talking about the economic situation in the country or on income dynamics, the population is much more focused on his personal experience.

— That is, if the people see that something is done in the correct, according to them, the direction they will wait for the best and their expectations will push the economy forward?

— It has become common place that in the zero years the main driver of economic growth was consumer demand. And the last two years, it became clear that this growth factor has exhausted itself. I would like to ask the economic authorities: “Your actions?”

Interviewed by Marina OZEROVA.

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