On February 24, 2022, Russian troops invaded Ukraine, not only indiscriminately attacking civilians, but also bombarding nuclear power plants shaking the world. North Atlantic Treaty Organization (NATO) troops, including the United States, are on the sidelines, and Ukrainian people are about to be country looted. Ukraine bravely counterattacked, and Western countries also provided weapons and took measures such as imposing sanctions on Russia. I just pray that Ukraine will repel Russian troops and peace will return.
What we wonder here is that Russia, despite being an economically small country, has allowed the invasion due to the inadequate military response of the Western nations. I would like to think economically why that is.
Of course, Russia is a country armed with nuclear power weapons, we cannot start World War III. So I know that the Western nations are rushing to help, but nonetheless. Russia’s gross domestic product (GDP) will be only $ 1.5 trillion in 2020. Compared to the GDP of major countries, Russia is less than Italy’s $ 1.9 trillion, France’s $ 2.6 trillion, Germany’s $ 3.8 trillion, and the United Kingdom’s $ 2.7 trillion, almost at the same level as South Korea’s $ 1.6 trillion. The economic scale of Germany, France, and Italy, which are in the EU, is 5.5 times that of Russia, and if the UK is added, it is 11 trillion dollars, which is 7 times more than Russia. Japan is $ 5 trillion, 3.4 times of Russia, and the United States is $ 20.9 trillion, 13.9 times of Russia. At the beginning of the Pacific War, Japan was said to have less than one-tenth economic power of the United States. Russia did not attack the United States, of course, but it seems that it is in a more reckless war than Japan at that time.
Russia has turned all Western nations into enemies with this small economic power. Of course, even if you are poor, it is possible to overwhelm with military power to some extent. Looking at the military power of major countries, the United States is overwhelming at $ 780 billion and Russia at $ 62 billion, which is 12.5 times less than the United States. It’s a little better for Russia to compare in military power than in GDP, but it’s still overwhelmingly inferior. The total military spending of Germany, France, Italy and the United Kingdom is $ 194 billion, which is more than three times that of Russia without the United States. Why is Russia so bullish?
The numbers mentioned so far show the value of the dollar of each country converted at the exchange rate, but the numbers converted at the exchange rate may not necessarily represent its true military power. Military power is the number of military equipment ✕ soldiers.
Goods such as military equipment can be freely imported and exported, so their prices should not change much around the world. Soldier costs, on the other hand, are determined by the country’s general wages. In countries where wages are low, the cost of soldiers is low. Therefore, the military power of low-income countries should be higher than the military spending converted at the exchange rate. Given that, the economic power that supports military power should be viewed in terms of purchasing power parity, considering that service prices, which are determined by wages, are low in low-income countries.
In terms of purchasing power parity, Russia’s GDP is one-fifth that of the United States, 90% of Germany, and one-third of the total of France, Germany, Italy, and the United Kingdom. If the United States doesn’t come to the fore, you might have thought that if you were to crawl Europe, you wouldn’t be afraid to triple your economic power. It may be correct that if you are prepared, you will not be afraid of the enemy, but the cost of doing so is great. In addition, Russia has the same economic power as Germany in terms of purchasing power parity GDP because of its large population. It also means that it is poor per person. Purchasing power parity GDP per capita, which represents the standard of living, is $ 28,000 in Russia, $ 41,000 in Italy, $ 55,000 in Germany, and $ 46,000 in France, and Russia accounts for 50% to 70% of these countries. It’s just a standard. He possesses excessive armaments in poverty and is even poorer.
In the early 1990s, Russia, Ukraine and Poland were equally poor countries. However, Poland, which is suitable for Western Europe, has developed, and the purchasing power parity GDP per capita has reached the level of developed countries at $ 34,000. Ukraine is $ 13,000. To the West is to become a country of freedom and democracy, as well as a prosperous country. A powerful nation like Russia can threaten a country that is several times more economical than its own and get what it wants. But if Ukraine surrenders and becomes Russia’s, what can Russia get from it? Only Ukrainians full of horror and hostility, destroyed cities, and fertile lands with unexploded ordnance are available. Countries bordering Russia will also be frightened and hostile, strengthening their armaments and mutual military alliances.
Germany, France and others will regret hesitating to provide military aid to Ukraine. Economic sanctions on Russia will continue and foreign investment will stop coming. Oil and natural gas are bought by China, and high-tech products are bought by China at high prices. Russia, which is still poor, will remain poor forever.
Modernized Russia will be an unfulfilled dream under Emperor Putin.