Oliver Stone - The Putin Interviews

OS:Which brings us to the larger problem which is you’ve been doing this as a president, prime minister, now president again for 15 years. 15 years. I’m sure you know the story of Ronald Reagan—one of the most admired presidents by conservatives in my country. He was famous for sticking to his schedule, which required him on most nights to come home to the White House by 6 o’clock and have an early supper and watch TV with his wife. And he managed to do that for eight years.

VP:Here’s a happy man. Very well organized, disciplined, and no doubt that was a great achievement of his—to his advantage.

OS:That is my point. He was a smiling man. He was a great greeter and meeter and he was wonderful—how do you say—he made people feel good and happy about themselves, in general.

And we laugh, but he presented a very good image for eight years and it worked. People didn’t see through it—most people did not see through it until after he left the presidency. He was very happy eating jelly beans and telling a good joke.

VP:Well, you’ve said that I’ve been dealing with one issue for 15 years but that’s not the case.

OS:I didn’t say that—I said you’ve been doing this for 15 years.

VP:Yes, but these are different matters. It’s one thing to be president, but it’s entirely another thing to be the head of the government. The most difficult work, at least in Russia, has certainly been the Chairman of the Russian government because there I can pinpoint issues that need tackling. Much of this work is very closed to the public simply because it doesn’t interest the public. But this work is of great importance to the economy of the country. And this work is routine and there is a great deal of this work.

OS:I understand, but Reagan was a big believer in delegating authority to everyone around him and he did that successfully—not always because he didn’t know what was going on—but he was successful. I’m just trying to make that example because it’s another way of living. If you have good associates that you trust.

VP:You need to address two issues. First you have to find the right people, and then you have to delegate authority to them. And that’s the rule. That is something we have to aspire to.

OS:Well, it seems to me you’re doing it the hard way.

VP:Well, probably. And yet I understand that and that is exactly what I’m aspiring to. There is a great deal of difference between us. Ronald Reagan was head of the United States. Be that as it may his difficulties are not compatible to the difficulties Russia was going through at the end of the 1990s and the beginning of the 2000s.

OS:Well, Reagan would disagree he would say the country, America, was broke and that it needed to be fixed and it was morning in America again and it was his job to bring enthusiasm and positive energy to America. He did a pretty good job of creating that feeling—it’s a feeling, an illusion.

VP:Almost being broke and being broke—these are two different things entirely.

OS:Well actually some people would argue that Reagan made America more broke because the debt grew enormously in America.

VP:Yes, certainly—today it’s what, $18 trillion? [88] Background Information: Putin’s estimate of the US National Debt is right on. It is now at around $19 trillion and growing, and amounts to 102% of GDP. See, “5 Things Most People Don’t Understand About The National Debt,” Taylor Tepper, Time (April 22, 2016). Retrieved at: http://time.com/money/4293910/national-debt-investors/ So there you go.

OS:Yes. And Russia’s debt is?

VP:Russia’s is 12 percent of the GDP. [89] Background Information: Putin’s estimate of Russia’s debt ratio is a bit low, but still, he is not far off. At present, Russia’s national debt amounts to about 15% of GDP. See, https://debtclock.tv/world/russia/

OS:So 18 trillion US and about 1 trillion Russia. [90] Correction: Oliver Stone actually greatly overestimates Russia’s National Debt which is only $150 billion (and not $1 trillion). Ibid.

VP:It’s important to remember the share of the GDP. In the United States, the debt’s share as compared to the GDP is 100 percent whereas in Russia it’s 12 to 13 percent—around—I don’t want to make a mistake but in Russia it’s for sure 12 to 13 percent.

OS:There’s no question about economics—we can go right there. The Russian economy. How is the Russian economy? It’s rough, I know—you want to talk about it a bit?

VP:Certainly, there are difficulties. There are difficulties which consist first and foremost of the fact that you need higher oil prices. It is very difficult to push economic actors towards investing into new industries which are less profitable than the oil and gas industry. And that is what the structure of our economy depended upon—our efforts aimed at changing the structure through administrative and financial means. We’re reaping some fruit, but not enough to change the structure itself. Right now the oil/gas price has fallen from more than 100 dollars to less than 30—and that is more than threefold. On the one hand it’s difficult to get the budget revenue. But on the other hand it creates stimuli to develop manufacturing and agriculture. And that’s what we’re doing. In terms of prices, the lower price of oil hurts the purchasing power of the population. And it also reflects on certain industries such as machine-building, car-building, construction and a number of other industries. But at the same time it drives economic players toward investing in other industries and that’s what we’re trying to support. And that’s why the first thing we’re doing is trying to secure investment. We support certain industries that are going through difficult times such as construction, car-building. But separately, we’re also trying to achieve the so-called import substitution.

OS:Import substitution—what’s that?

VP:This strategy doesn’t seek to eliminate imports. It seeks to create the manufacturing of high technology products inside the country. In the past we could buy anything using the oil money. But that was undermining the stimulus for internal development. And right now the government is trying to support high technology industries, to help both defense and civilian industries. And I have to say that we are achieving success in that regard. In agriculture, as a response to the actions of our partners, we have introduced certain restrictions and we have freed our internal market for Russian producers. But high technology industries, our partners have introduced restrictions on their exports. And thereby they stimulated us to create similar manufacturing processes within the country. I have to say that we are achieving success in this, despite a certain drop in the GDP. We have managed to achieve some good macro-economic indicators which are grounds for thinking that we are not just emerging from the crisis, but that we actually have good prospects for the future. Just have a look. Our budget deficit is just 2.4 percent. Even though we thought that it would be more than four percent. We have a surplus of trade and also a current account surplus. So we sell more than we purchase and the balance of payments of our budget is also very positive. At the same time, we have a considerably higher level of reserves than we did before. It’s $360 billion. These are the reserves of the central bank. The government also has at its disposal two more reserve funds—$80 billion and another $70 billion. We have this to fund the small budget deficit that we have. And that’s why we managed to maintain the very high quality of the Russian economy—its fundamentals are very good. [91] Background Information: Putin is optimistic about the strength and stability of the Russian economy, however, oil prices in 2016 dropped well below the $50 per barrel level that had been assumed for government planning. At $30 per barrel, the Finance Ministry had to begin considering different scenarios for 2016. See, “Moody’s Warns Russian Deficiit Goal in Doubt as Oil Jolts Budget,” Anna Andrianova, Bloomberg (February 12, 2016). Retrieved at: https://www.bloomberg.com/news/articles/2016-02-12/moody-s-warns-russian-deficit-goal-in-doubt-as-oil-jolts-budget And what’s more important, we now see some success and progress—the contribution of the agricultural sector of the economy is growing.