While we continue to spend wildly, increasing our deficits and debt, Russia seems to recognize reality. President Medvedev, according to Russian news sources, will cut 20% of federal officials by 2013:
Russian President Dmitry Medvedev signed on Monday a decree reducing the number of federal officials by 20% until 2013, the Kremlin press service said.
The decree follows the instruction made by Medvedev in June. The measure could save up to 40 billion rubles ($1.3 billion) out of the Russian federal budget.
The US, despite an unequivocal message sent by the electorate, continues to spend. The “Obamacare” entitlement was passed over the wishes of the public, even though other entitlements are insolvent.
Why this behavioral divergence between the two governments? Has Russia suddenly become more capitalist than the US? Are they more responsive to their citizens?
The answers reside in history. The Russian government knows scarcity. For 90 plus years, they dealt directly with (and created) shortages. Communism made the government virtually 100% of the economy. Economic problems by definition were their problems.
US government began small with few responsibilities. The private economy produced unprecedented wealth and income. The US economy grew to the largest in the world, with a standard of living unmatched.
The different reactions of the two governments can be traced back to these origins. The Russian government