A longstanding platitude shared by both the Kremlin as well as domestic and foreign analysts is the need for Russia to diversify its economy away from energy dependence and reduce its non-oil budget deficit. The unfortunate reality is that this self-evident orthodoxy has languished on the shelf as frothy oil prices have continued to buoy the Russian economy and as the federal budget remains in balance despite expenditures rising by about 20 percent from last year. Arguably, the government is no different from those in Europe or the United States in terms of trying to postpone socially and politically difficult decisions if there is some more palatable alternative.
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