138
The shape of a potential peace agreement in Ukraine remains uncertain, but a deal appears closer than ever. [...] Meanwhile, according to the Telegram channel Faridaily, the Kremlin is already preparing for one of the biggest challenges Russian society will face when the war ends: the return of hundreds of thousands of traumatized soldiers. Meduza shares the channel’s findings in English.
[...]
The sources predicted a range of major societal issues, including:
- Rampant drug and alcohol abuse: Many returning soldiers are likely to turn to alcohol or drugs to cope with their physical and emotional trauma, experts told Faridaily. “The first year after the war will be a year of heavy drinking,” a source from Russia’s Labor Ministry said. A veterans’ rehabilitation specialist noted that many who have already returned with injuries, concussions, or lost limbs are struggling to reintegrate into civilian life — especially in rural areas — and have started drinking heavily. One government source said that many veterans return from the war with a deep sense of grievance: “I’m a hero, I fought for you, and you’re just worthless cowards who stayed behind.”
- Unemployment, crime, and debt: Having earned millions of rubles (equal to tens of thousands of dollars) on military contracts, many soldiers may be unwilling to take low-paying civilian jobs. A federal official warned that this could leave psychologically traumatized individuals — many accustomed to violence and familiar with weapons — without a stable income, likely driving a surge in crime. As their quality of life declines, former soldiers are also expected to take out loans en masse, a source at a state-affiliated think tank told Faridaily.
- Workplace difficulties: Employers will face challenges as they are legally required to hold jobs open for returning soldiers, Faridaily’s sources said. Veterans will be difficult to fire, yet many may be considered “problem employees” due to alcoholism and antisocial behavior. “The best-case scenario is that they’ll be paid just to stay away from the workplace,” a Labor Ministry source predicted.
- Domestic violence and unplanned pregnancies: The return of soldiers from the front won’t necessarily be the joyful reunion many families anticipate, Faridaily writes. Wives, in particular, will be at high risk of facing violence from men with PTSD. Experts told the channel it will take at least a year or two for many veterans to readjust to family life. The Labor Ministry also expects a rise in unplanned pregnancies, while a government-affiliated think tank predicts a postwar baby boom. However, the sources said a steady, controlled increase in birth rates or the formation of stable new families is unlikely.
[...]
It's an interesting article from a unusual point of view (and an unusual source).
From a macroeconomic point of view, a major problem for Russia’s civilian industry could be a lack of labour (in addition to what the article suggests regarding returning soldiers' psychological problems), as stated by several (Russian) economists. And even Russian media admitted that private companies in other sectors than military are operating at around 80% of capacity due to a lack of labour. According to the Russian consultancy Yakov and Partners, Russia could reach a worker shortage of 2 to 4 million people by 2030.
Another problem for Russia on the economic road to peace could be the banks. Sberbank and TVB, both state-owned, have been required by law to fund companies from the military complex at state-subsidised rates, not in the least because Russia’s central bank had to raise interest rates to 21% to curb a devastating inflation. Some other sectors (agriculture, construction) also benefited from state-sponsored lower-than-market rates (these public funds does not count as Russia’s official budget of 40% for military spending afaik).
According to official numbers by the bank of Russia, this led to an increase of profits for both Sberbank and VTB, but these loans -which essentially means that banks could 'mint' a large amount of money within a short time span - now amount to 16% of Russian commercial banks’ total assets. This poses a high risk to the banking sector, and it increases once the war is over and peace breaks out. Central Bank Governor Elvira Nabiullina has warned already late last year that the Russian banking sector’s capital adequacy ratio has dropped by 2 percentage points in the course of 2024, reaching 12.5%. (Simply speaking, the Capital Adequacy Ratio is a metric used by regulators around the globe measuring a bank’s ability to absorb a sufficient amount of loss before they loose depositor funds.) Russia’s ratio is still above the minimum requirement under the so-called Basel III rules (which is 10.5% if I am not mistaken), but the drop is significant, meaning that Russian banks could be quickly running out of cushion to avoid insolvency once the situation changes.
Russia has also lost its most important economic lifeline, oil and gas, and Europe won’t come back as buyers given that the Kremlin is posing a threat to the continent.
And all this must be seen as even now, as the war is raging, the Russian economy, despite coming from a relatively low level, is already slowing down. The IMF expects a growth rate of 1.3% this year and 1.2% in 2026. Some time ago, Russian economist Natalia Zubarevich said that in Russia “there will be no collapses, but rather a viscous, slow sinking into backwardness.” Maybe she is right?
[Edit typo.]
Thanks for write up!
That quote from Natalia Zubarevich goes hard