The head of the Central Bank of the Russian Federation, Elvira Nabiullina, said during a speech at the Financial Congress in early July that Russia is faced with three main problems for the Russian economy.
"I would now highlight three types of restrictions, they are interconnected. This is the labor force. The situation shows us that we can no longer grow extensively and growth can only be due to labor productivity, and labor productivity is technology. And for us there are restrictions “is access to technology, our own technological development,” Nabiullina noted.
And a lot of Russians and Russia's supporters look at the GDP and claim everything is fine!
The thing is GDP doesn't matter in a war economy, Nazi Germany's main country GDP (excluding occupied lands) grew during 5 out of the 7 years of the war and surprisingly in nominal terms in 45 was just 15% lower than back in 1939!
They don't understand the circumstances of actual labor productivity and stagnation in other areas.
You build a 10 million tank and that gets blown in 6 weeks, wow you increase the GDP by 10 million, you have 3 people employed, and you also spend on ammo and fuel, and everything looks fine, but another country buying 100 trucks to improve transportation for goods between suburbs and the main cities will get a way better economical gain from that!
The USSR increased its GDP like that, with the millions of vehicles produced, they all rot either destroyed in Ukraine or abandoned in Siberia, and they have bought nothing economically.
Gazprom lost money for the first time in their history, and now Russia wants to keep the agreement for the gas transition, pretty telling how much desperate they are to sell gas for euros and USD! They seriously don't understand they're falling into the same trap the USSR did after Afghanistan and this time it will be 10 times worse.
Unfortunately, this will keep dragging on, and no matter how worse this will end for the Russians the suffering of Ukraine is the real tragedy.