The continued existence of this structure, therefore, grossly underestimates how well Muscovites live. The average salary for all of Russia according to official statistics is 200 dollars. Remembering that official salaries grossly underestimate true earnings, we can safely, I think, at least double that. In Moscow, salaries are at least twice if not three times as high as the rest of Russia. According to the economic statistics (I am not sure what basket of goods this entitles you to), middle class in Russia is defined as earning more than 700 dollars. However, the disposable part of that 700 dollars is much higher than for an American.
Property is for most people, their biggest expense. Most Muscovites, however, pay very little to live in their apartments. Older people gained possession of their flats from the government after the fall of communism, and as a result never really paid anything for the place they live. Many of these old people have now died and the flats are occupied by the younger generation. Although many grown children still live with their parents and might complain about it, the fact remains they don’t pay rent. Basically, then, only non-Muscovites or upwardly mobile people pay rent. Of course, the really rich have bought big villas outside the ring (as the freeway around Moscow is called) or exchanged their cramped apartment for a bigger one, but it is not the plight of the 150,000 plus millionaires in this city as well as the growing upper-middle class that we are talking about.
In addition to not paying rent, utilities are still not deregulated so that water, for example, is not paid for by quantity consumed, but by how many people live in the flat. The rate per person is ridiculously low. Building fees do exist and are rising but at the moment remain minimal—between 500 and 1,200 rubles per month (about 17-40 dollars). Since healthcare is kind of paid for by the state, the next biggest expense is transportation. A brand-spanking new Lada will set you back 6,000 dollars, but the public transport is great here and the traffic terrible, so many people remain carless (though a car is a huge status symbol in a country obsessed with status). Ride all you want on the metro for 10 dollars a month. Food is relatively cheap in the less expensive super markets and markets, so basic expenses for someone like me add up to about 200 dollars a month. This means that most non-pensioner Muscovites have quite a bit of cash to throw around, since as discussed in my piece on banks and taxes, to most Russians, there is no point in saving anything.
Many Muscovites love to spend their money on status symbols. The phone is perhaps the average Muscovite’s favorite symbol. The accountant at my school seems to have a new several-hundred dollar phone every couple of months, and I am considered terribly outdated. I don’t even have a color LCD screen for heaven’s sake. Another symbol is the tan. Where you go and how many stars you stay in is of the utmost importance. A lady I teach in a business, who works in customer service told me about her all-inclusive vacation to Egypt at a 5-star which cost 2,400 dollars for the week. These people are not New Russians; they are merely making use of their disposable income, which is a very large percentage of their salary.
Posted by Aaron at June 14, 2004 12:54 PM