Jon (ex_mastodon326) wrote in russian_news,

Perverse Preferences for Subsidies Not Cash
Yulia Latynina
2 June 2004

Last Thursday, nearly 1,000 people joined a demonstration outside the State Duma. Were they protesting human rights violations? Police brutality? No, they were protesting the government's decision to replace a range of benefits and subsidies with cash payments. Next year, 13 million people who now qualify for subsidies will receive $6 billion from the state. But people don't want billions -- they want benefits.

The system of subsidies works something like this.

Act One. A doctor writes his elderly patient a prescription for a subsidized medicine.

Act Two. The elderly woman goes to the pharmacy. The prescribed medicine is in stock, but the pharmacist knows that the woman will only pay half-price. He won't collect the other half until the state medical insurance fund processes his request, and that could take anywhere from a month to a year. The pharmacy is privately owned and can't afford to go into the red. The pharmacist therefore tells the woman that the Russian-made medicine prescribed by her doctor is out of stock and suggests an imported equivalent, which costs $100 and is not on the list of subsidized medicines.

Act Three. There is another pharmacy around the corner. It belongs to the governor's son. This pharmacy doesn't dispense subsidized medicines, either, but it does have an excellent working relationship with the local medical insurance fund, headed by the deputy governor's daughter. The two have worked out a nifty deal: He sells medicines at full price, then files for compensation as though he had sold them at the subsidized price. She approves his request and they're both in the money.

Benefits and subsidies are nothing more than a clever way to embezzle from the state budget on the pretext of providing assistance to the needy.

It's not hard to get 1,000 people to turn out for a demonstration. But as a talk show host on Ekho Moskvy who frequently fields questions about subsidies on the air, I can tell you that I have never had a single caller who supported the idea of replacing subsidies with cash payments. Every time I point out that subsidies are actually inaccessible to most of the people who qualify for them, and that 2 rubles are embezzled for every one that goes to help the population, I am bombarded by irate callers demanding that the station manager "get rid of this woman who goes around bad-mouthing pensioners." And the station's pager fills up with messages accusing me of "having no idea what real life is."

Of course I don't. If I knew the secret of life I would long ago have invented a cure for cancer and received the Nobel Prize for biochemistry.

People regard subsidies as medals of honor to which they don't necessarily attach a monetary value. The demonstrators outside the Duma held posters declaring: "Subsidies Are Permanent, Money Is Temporary." And this slogan accurately reflects their view of the world. People are afraid of money and the freedom of choice that comes with it. Subsidies, on the other hand, constitute the state's recognition of their misfortune.

A woman who was dying of cancer once broke down on my radio show. There was nothing I could say. It would have been perverse in that situation to argue that subsidies distort the payment structure of the companies that have to step in and pick up the tab for her treatment when the state fails to pay.

The crux of the problem is simple: Life is unfair. Cancer, old age, grief and death cannot be compensated with money. But Russian people regard subsidies as the state's compensation for old age, grief and death. They are society's recognition of the services rendered by veterans and heroes.

Subsidies are the last vestige of socialism, of a society in which the state paid us nothing and gave us everything -- or rather, promised us the world. People want their subsidies. For as Mikhail Khodorkovsky wrote in the open letter published earlier this year, President Vladimir Putin is more liberal than 70 percent of the people who voted for him.
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the problem being described isn't benefits, it's corruption. we have that here in anti-socialism too.
I understand people who joined the demonstration because the payments will be around 200 - 250 rubles for one person, and for example, the underground travel card for one month is about 500 rubles. And with the subsidies you really can bye medicine you need in most cases.

Excuse me for my bad English, I know that it's very poor but I learned it long ago at school...
Here's something I thought was interesting:

The Russian Newspaper Murders
This problem has been going on for some time, and was documented in a recent PBS piece. (PBS is like an American version of the BBC, but without as much investigative journalism, or support).

This feature premiered in New York on Thursday, July 8. On July 9, the Editor-In-Chief of Forbes Russiawas shot outside his apartment.

Committee for the Protection of Journalists

NY Times story
Ha! My brand of communism worked! Now let me play with my legos.


April 19 2005, 06:08:50 UTC 11 years ago
Your arguments for money compensation miss an important point. One person may need no subsidies or uses the subsidized medicaments once a year. Another person uses the medicaments equivalent of $200 per month. You can not support both of them with an equal equivalent of $100. The first person will be glad to receive more money, but the second person dies of his dicease as he can no more afford the full medicament course.

That is the point where people start protesting. Equal treatment is not given when everyone gets the same money to pay the medicine bills. Equal treatment is only given when everyone gets the cure.

Yes, the corruption exists. But the problems mentioned are not unsolvable within the system of subsidies. You can require the availability of all subsidized medicaments in the pharmacies in their license contracts, and you can improve the processing requests. It is a matter of efficiency and control.
Mastodon, you have not posted for over 2 months! This is a great community - please post again...:)

very interesting, i love reading all of this. add me?
Здравствуйте! 1. Это не Рыкова Аня... Это ее намечавшийся, вплоть до двух дней остававшихся до возвращения в Россиию из Албании - любимый и желанный жених... С которой он вместе прожил больше года... Которая говорила ему, что хочет детей и видит отцом......... Которая............. 2. Но вообщем суть не о том.............. Кто читал прессу, кто смотрел первый канал, с кем под ником "Аня" общалась ее типа "мать"(которая вовсе ей не мать - а далее по тексту гнида), тот много-го наслышан обо мне............ Всего того дерьма что на меня вылила эта гнида......... Ради выгодной сделки продажи дочки..... 3. Аня скоро (через несколько дней) уезжает в Албанию, мне так и не дали возможности с ней встретиться............ И меня лишили всех шансов................................ на право ЖИЗНИ!!!!!!!!!! Я приходил к дому, гнида вызывала ментов и платила им деньги, что бы меня держали в КПЗ...... Я попытался уведиться с ней в институте............. Гнида расклеела мои фотографии на всех КПП, приставила к Ане охрану (девочку, которую поселила на квартире своего сожителя, что бы та отрабатывала кров) ............... и т.д. Вообщем так............. Кому интересно, узнать хоть что-то о правде, о жизни Ани, о том, что было после Албании..... О том, почему я ничего не могу сделать, о том, как покалечили меня на самом деле, о том, как меня лиши правда на жизнь, на учебу... О том, за какие заслуги........... и т.д. Пожалуйста........... Там правда все сумбурно............ Но что-то............. Вы уж простите..... 4. А кому не нужно все это, кто может просто помочь!!!!!!!!!!!!!!!!!! Кто и передачу не смотрел, кто и........... Переправте Ане, кто знает ее новый адрес или агент или аську... пожалуйста ссылку на мое письмо...... Мне и ей это надо больше ЖИЗНИ!!!!!!!!!!!!!!!!!!! 5. Кто знает хоть какую-то информацию - адрес, ФИО, ориентировочный день прилета в Россию и т.д. об этом русско-албанском ЧМО, обязательно срочно пишите!!! Мой е-майл (Не думаю, что ЖЖ долго проживет, Анина "мать" снова пригласит программистов и те вновь все вернут а круги своя, удаля ЖЖ) Вы уж простите, но человеком, а уж тем более мужиком, я такое гнидоподобное существо назвать увы не могу... Там в Албании крутил мозги девочке, поил ее в ресторане, зная, что она не откажет, что она всю жизнь мечтала работать в МИДе, и прекрасно знал вонючеубогий, что у нее есть в России жених... А теперь этот опарышь даже трубку не берет, даже е-майл свой удалил... Обакался малышь, стесняется со мной даже разговаривать... 6. Если Вы мне ничем не можете помочь, не знаете её нового е-майла, что бы сообщить ей об этом, не знаете ее новой аськи или агента, не знаете номера ее нового мобильного телефона... Но при этом если Вы вдруг знаете людей, которые могут владеть чем-то из вшеперечисленного, если не сложно - переправте им это сообщение... За ранее благодарю!!! Приношу извинения, если Вас незаслуженно побеспокоил...
Dear Jon,

I’d like to invite you to visit - RUSSIA PROFILE is an English-language information service offering expert analysis of Russian politics, economics, society and culture. It consists of a website ( and magazine. Our magazine is a project of the most influential news agency in Russia – RIA “Novosti”.

I hope this information will be useful for you.

Many thanks