Window on Eurasia: Moscow’s New Plan for Company Towns Won’t Help Many

Paul Goble

Vienna, December 23 – A new Russian government plan to help company towns is neither larger enough nor carefully targeted enough to do much good, according to a leading Moscow commentator. Indeed, he suggests, the plan may simply become yet another way in which budgetary funds will disappear before they reach their intended targets.
Today’s “Vedomosti” reports today that the government’s anti-crisis commission under First Vice Prime Minister Igor Shuvalov yesterday approved a list of 26 “monogorods” to which Moscow will provide financing to help them diversify their economies and thereby provide employment for the unemployed (www.vedomosti.ru/newspaper/article/2009/12/23/222049).
The commission, the decision of which is expected to be confirmed by the government as a whole, has approved 10 billion rubles (340 million US dollars) in direct subsidies and another 10 billion rubles in three-year loans for these 26 “company towns.” At the same time, it decided to close down one such town where the mines have run out and move residents elsewhere.
In a comment on this program posted online today, Kasparov.ru commentator Yury Gladysh says that this report shows that “the powers that be assume that [Russians] are not very intelligent people” and that “it is clearly intended for people no acquainted with mathematics or with geography” (www.kasparov.ru/material.php?id=4B31CF0E2850C).
Mathematically, this plan sounds impressive but in fact will do little to address the problem. On the one hand, the government in the past has identified nearly 500 company towns facing problems but is now prepared to offer help to only 26 of them, a pattern that should lead people to inquire as to what will happen to all the others.
On the other hand, Gladysh says, some of the cities on the list are quite large, meaning that the actual subsidy will be too small to do much good. Toliatti, a city of almost 800,000 residents, is scheduled to receive 14,285 rubles – less than 500 US dollars – per capita, an amount far too small to overcome the economic crisis.
And geographically, he continues, the list the government has come up with is extremely problematic. A company town, Gladysh recalls, is “a settlement of an urban type, a large part of the active population of which works for one enterprise or even for enterprises of a single technological branch.”
Moreover, the Kasparov.ru observer notes, most company towns are “far removed from other industrial centers,” lack “reliable transportation connections,” and are generally “difficult to get to.” Using those criteria, he says, many of the places on the government’s new list can be called “company towns only in the most conditional way.”
Naberezhny Chelny, Nizhny Tagil, Leninsk-Kuznetsky, and Budennovsk clearly don’t belong on a “company town” list. And “to consider the ancient merchant city Sarapul a company town is possible only for someone who never has heard anything about this remarkable city on the Kama.”
Not only does that urban center have a variety of industries, he writes, but “almost every Russian has tried at least once Sarapul candy, beer or stronger drinks.” Clearly, “a city with such characteristics,” Gladysh argues, “does not find the definition of a company town according to any parameters.”
Given that pattern, he continues, helping even these questionable company towns may not be the first thing on the minds of the authors of this plan. Instead, they may be more interested in creating yet another outflow of federal funds from which they and their supporters can enrich themselves.
If so, this plan will in fact do little to calm the all too real agitation of people in company towns who lack jobs and increasingly live without hope. And as they grasp what their government is not doing for them, they will see, as another writer put it yesterday, that in their country, “the poor are paying for [so-called] reforms” (www.stoletie.ru/print.php?ID=44669).