Russia’s economy has entered death zone

Alexandra Prokopenko/The Economist: The most dangerous feature of this new structure is the fuel it burns. Russia’s economy now runs on what might be called “military rent”: budget transfers to defence enterprises that generate wages and economic activity. Functionally, this resembles the oil windfalls of the 2000s. But there is a critical difference. Oil rent came from outside the system; foreigners paid for a tradable asset, and the money circulated through the economy with real multiplier effects. Military rent is internal redistribution towards assets designed for destruction. The body is metabolising its own muscle tissue for energy…