Russia appears to have survived the West’s sanctions, but the numbers tell a different story. Beneath the image of stability lies a nation draining its savings, facing labor shortages, demographic decline, technological stagnation, infrastructure decay, and growing dependence on China. In this video, we break down the 10 structural weaknesses quietly undermining Russia’s future and examine why the country’s biggest challenges may outlast the war itself. What happens when the math finally catches up?
00:00 - Introduction
01:05 - The Budget (or Lack Thereof)
03:26 - The Dependence on China
05:27 - The Technology Issues
07:22 - The Worker Black Hole
09:58 - The Demographic Death Spiral
11:53 - The Veterans Who Came Home Violent
13:49 - War Fatigue Breaking Through
15:53 - The Country Is Physically Falling Apart
17:56 - Corruption Eating the War Machine
19:08 - The Center of Russia
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SOURCES: https://pastebin.com/2062r1Yy
00:00 - Introduction
01:05 - The Budget (or Lack Thereof)
03:26 - The Dependence on China
05:27 - The Technology Issues
07:22 - The Worker Black Hole
09:58 - The Demographic Death Spiral
11:53 - The Veterans Who Came Home Violent
13:49 - War Fatigue Breaking Through
15:53 - The Country Is Physically Falling Apart
17:56 - Corruption Eating the War Machine
19:08 - The Center of Russia
Support us directly as we bring you independent, up-to-date reporting on military news and global conflicts by clicking here: https://www.youtube.com/@TheMilitaryShow/join
#militarystrategy #militarydevelopments #militaryanalysis
#themilitaryshow
SOURCES: https://pastebin.com/2062r1Yy
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NewsTranscript
00:00on paper russia won the economic war against the west after four years of the most aggressive
00:05sanctions ever aimed at a major economy moscow is still standing with a technically growing economy
00:11the ruble went through a major dip and rebounded to levels close to those before the war and
00:16vladimir putin keeps telling the world that time is on russia's side but here's what the paper
00:20doesn't show you by the start of 2026 the liquid reserves in russia's rainy day fund the national
00:27wealth fund the cushion built to absorb exactly this kind of shock had been more than halved in
00:32dollar terms measured against the size of the economy it had shrunk by roughly 2.4 times and
00:39the federal budget deficit blew past the official plan by roughly five times that's not the picture
00:45of a country that's adapted that's the picture of a country burning through its savings to keep a war
00:50going and quietly hoping nobody does the math today we're doing the math because beneath that stable
00:56surface russia is carrying 10 structural weaknesses while none of them are likely to cause a total
01:02collapse every single one of them is getting worse and several of them feed each other number one the
01:09budget or lack thereof let's start with the money because everything else flows from it in 2021 the
01:16year before the invasion defense and internal security ate up about 24 percent of russia's federal budget
01:23budget by 2025 that figure had climbed to about 40 percent the exact number is difficult to determine
01:29because russia keeps classifying spending on defense projects in fact some sources suggest that classified
01:36spending is at least as much as nominal spending for example in just the first three quarters of 2025
01:43a staggering 7 trillion rubles roughly 88 billion dollars was allocated to these closed budget items
01:49that represented a massive 39 increase compared to the same period the year before now look at the
01:56income side and that's where russia is truly in trouble russia built its 2025 budget assuming oil would
02:03sell at around 70 a barrel but it actually averaged 58 the government also bet on a weaker ruble to
02:10pad
02:10its revenue but the ruble stayed stubbornly strong the result is that oil and gas revenue fell by nearly a
02:16quarter year on year while spending kept climbing so moscow did what any government drowning in
02:22reading does it rewrote the budget even twice in a single year the deficit still ballooned to 5.6
02:28trillion rubles about five times what was planned add in struggling regional budgets and the pension
02:34and health funds and the total hole in russia's public finances hit 8.3 trillion rubles that's nearly
02:40four percent of the entire economy cut off from western lending the kremlin can either borrow at home
02:46at brutal interest rates or raid the national wealth fund and it's doing both while the fund is
02:52half gone in dollar terms and that's even after record high gold prices help prop up its value the situation
02:58is so bad that the government was forced to propose a reduction in military spending for 2026
03:04according to cipri this measure is also likely to be amended to increase the budget
03:09but all this does is further show why russia is slowly being drained of money
03:13it can't keep up its economic growth and yet it needs to continue funneling more money into the
03:18military in order not to be seen as weak or attempt to make progress eventually it's going to be a
03:24lose-lose situation number two the dependence on china the second issue stems partially from the first
03:31concerning russia's economy because when europe piled on with sanctions russia was forced to find other
03:37vendors china proved to be a willing partner in 2025 china took around 30 percent of everything russia
03:45exports up from 16 before the war it supplied roughly 35 percent of russia's imports and in the
03:52categories that actually keep a war economy running like machinery industrial equipment and spare parts
03:58china's share has climbed as high as 90 percent all you need to do is look at the car market
04:03to see the
04:04takeover in real time in 2019 chinese brands made up just two percent of new cars sold in russia by
04:112025 they're counted for slightly more than half western automakers walked out russia's own production
04:18collapsed and beijing filled the vacuum even the aforementioned national wealth fund now leans on china
04:24as the chinese yuan makes up close to 60 percent of its liquid reserves but the relationship is wildly
04:30lopsided as trade with russia is barely three percent of china's exports for beijing russia is a minor
04:37customer for moscow china is the whole game and china knows it so beijing dictates terms it demands
04:45steep discounts on russian oil and coal up to 50 of the price russia used to charge europe it also
04:51drags
04:51its feet on the gas pipelines moscow is desperate to build like power of siberia 2 hedging on providing
04:58complete details on financing the project on its end even after a meeting between russian president
05:03vladimir putin and chinese president xi jinping and saying that it understands russia's need to
05:08expedite the project china didn't provide an updated timeline china also refuses to invest in russian
05:15production or hand over advanced technology it'll happily sell russia finished goods and strip out its
05:21raw materials but it won't help russia actually develop so russia traded a dependency on the west it
05:27resented for a dependency on china it can't escape number three the technology issues a modern military
05:35runs on modern technology and russia is being slowly starved of it for 30 years the west has practically
05:42controlled russia's modern economy the eu and the united states accounted for about two-thirds of all
05:47foreign direct investment in the country then the invasion flipped the switch foreign investment that
05:53stood at roughly 500 billion dollars at the end of 2021 and more than cut in half and the worst
05:59thing
05:59is that nobody is rushing in to replace it not even china most imports from china aren't related to direct
06:06military operations sure china has been selling drones in droves but it's also supplied commercial
06:12drone models used by ukraine playing both sides for its economic benefit the combination of a stagnating
06:18economy and dependence on a partner that doesn't allow advanced technology exports means that russia
06:24is slowly losing its status as one of the most technologically advanced countries russia spends
06:30barely one percent of its economy on research and development compared to 3.3 percent in the united
06:35states or nearly five percent in south korea and given that this could mean less and less money each year
06:41russia is falling further behind with a big chunk of what little it does spend going straight to the
06:46military not the civilian economy then there's the fact that russia is also losing access to one of
06:52its main abilities to fund growth as ukraine has been hammering russian oil refineries with long-range
06:58drone strikes in a normal country you fix the damage and restart but russian refineries are also
07:04stuffed with western equipment leftovers from decades of importing technology it didn't have and the spare
07:10parts are sanctioned so plants that get hit can't get the components or the servicing to come back online
07:16quickly a single drone can take a refinery offline for weeks choking the domestic fuel supply and
07:22forcing the state into costly emergency interventions number four the worker black hole even if russia
07:29could manage to fix all its oil refineries and re-establish all trade lines to the world chances are
07:35it couldn't really service them in time that's because the country has one of the most paradoxical
07:40demographic issues a low unemployment rate of only 2.1 percent in late 2025 while this would sound like
07:48an economic boon to the uninitiated it's actually the opposite most western countries have had
07:53unemployment rates ranging from around 6.4 percent for the past four years as a quick reminder the
08:00unemployment rate is calculated by dividing the number of unemployed people by the total number in
08:05labor force then multiplying the result by 100 and sure the world was hit by a major pandemic but the
08:12unemployment rate actually dropped from pre-covid levels but russia has somewhere between 1.5 and 2
08:18million unfilled jobs and there simply aren't enough workers to go around worse yet the reasons are
08:24stacking on top of each other for one the population is aging fast as there are roughly 7.5 million
08:30more
08:30russians in their 60s than in their 20s the big generations are retiring and the small generations
08:36born in the chaotic 1990s can't step in to replace them in large numbers the war made the issue
08:42dramatically worse hundreds of thousands of working age men were pulled into the army or killed at the
08:47front hundreds of thousands also fled the country to avoid mobilization and these were often the it
08:53specialists and engineers with the means and skills that russia needed and the kremlin's crackdown
08:58on migrants slammed the door on the labor that used to fill the gaps then there's an issue where
09:03the country is so strapped for soldiers to send to the front line that it continues boosting
09:08conscription bonuses in 2025 some of the regions reported that a yearly wage for a new contract
09:14soldier with the initial bonus would be 4.5 times higher than the average yearly salary and this
09:20triggers a chain reaction high wages in the military mean too few workers elsewhere which means wages
09:27spiral upward faster than productivity which feeds inflation so there aren't enough people for
09:32russian jobs and yet those jobs that exist don't pay for the things russia needs the non-essentials
09:38market like the automotive industry is a great indicator here in the second half of 2025 russian car
09:45makers avtovaz kamaz and gaz were so squeezed by truck sales falling by half that they cut back to a
09:52four-day work week this only means that the workers are making less money and the cycle continues number
09:58five the demographic death spiral that worker shortage connects directly to the darkest number in this
10:05entire report russia has had a shrinking population for most of the last three decades the fertility rate
10:11hit a low in the 1990s and never truly recovered for long enough to matter it went from a historic
10:16low of
10:171.16 in 99 to a so-called high of 1.78 in 2015 and then sunk back down to
10:231.4 in 2023 immigration used to
10:27bridge the gap but even that stopped working as the net migration turned negative in 2022 the country is
10:34simply getting smaller with lower fertility rates and more people leaving the country than coming in
10:39then came the war independent estimates piecing together public records put the number of russian
10:45soldiers killed at the front at least 220 000 by may 2026 the last time russia's defense ministry
10:52published a death toll was september 2022 when it claimed fewer than 6 000 had died the gap between
10:59the propaganda and the graveyards is enormous and the kremlin keeps the real figures confidential so you
11:04can't see it so what's the kremlin's answer not the kind of policy that might actually work instead
11:11it makes financial incentives for pregnant school girls new restrictions on abortion and crackdowns
11:17on the very migrants the economy can't survive without this is the spiral the war kills working
11:23age men fewer men mean fewer workers and fewer fathers fewer fathers mean fewer children fewer
11:29children means an even smaller workforce a generation from now the war is essentially removing russia's future
11:35the war is also far from over and is increasingly starting to impact russians in large cities which
11:41brings us directly to the next point but before we do that make sure you're subscribed to the military
11:47show for more daily analytics like these we track everything in global geopolitics so you stay informed
11:55number six the veterans who came home violent now some of the soldiers do come home and for a growing
12:01number of russian communities that's its own catastrophe russia filled its ranks in part by
12:07recruiting convicted criminals straight from prisons with the promise of a pardon it threw traumatized
12:12often brutalized men into the meat grinder then sent the survivors back into civilian life with no real
12:18support no rehabilitation and a pardon in their pocket the result is exactly what you'd expect according to
12:25tallies by the independent outlet vyrtska veterans returning from ukraine had killed or seriously injured
12:31more than 1 000 people back home by late 2025 with at least 551 killed and those are only the
12:38documented cases the crime data backs it up as 2024 saw the highest number of serious crimes in russia in
12:4514 years and the trend kept climbing into 2025 the violence clusters are also where you'd expect in the
12:52regions bordering ukraine and increasingly in some of russia's ethnic minority regions this is poison for
12:58the kremlin in a way sanctions never could be the russian army has always been an object of national
13:03pride now ordinary russians are watching pardon killers walk their streets and reading accounts
13:09of commanders torturing their own men and sending the wounded back to die the myth of the heroic soldier
13:14that russia is so desperate to publicize is curdling into fear and the state has essentially done nothing
13:21no serious rehabilitation program no tougher sentencing because acknowledging the problem means
13:27acknowledging the war created it and the tightened budget means there's not enough money to create
13:32far-reaching government programs for mental health even the newly established defenders of the fatherland
13:37state fund which is supposed to provide psychological counseling has a very limited scope and doesn't
13:43help the people who need it most with more and more soldiers returning home the public is becoming aware
13:49of just how problematic the war has become which directly ties into the next problem number seven war fatigue
13:55breaking through now more and more people have gotten tired of the war and the constant propaganda from
14:01the kremlin is no longer enough to contain that dissatisfaction this has created a bit of a paradox at
14:07the heart of russian public opinion people will tell pollsters they support the war but want it to end at
14:13the same time as of february 2026 in surveys by the independent levada center about 72 percent of russians
14:20said they backed the army's actions in ukraine and yet support for opening peace negotiations hit 67
14:27which was a record high while the share who wanted the fighting to continue fell to just 24
14:33that's the lowest number for continuing the war since the invasion began in february 2022.
14:39think about what that means roughly two-thirds of the country now wants out even as most still say
14:44they back the troops essentially the population has stopped believing in the mission but hasn't found a way
14:49to say so out loud support for negotiations is also highest among women among russians under 40
14:56among rural residents and above all among people who get their news from social media and youtube
15:01rather than state television the kremlin still owns the airwaves but it doesn't own the internet
15:06and the generation that grew up online is the generation least willing to keep fighting there's
15:12one crucial catch and it's the kremlin's last refuge when russians say they want negotiations
15:17most actually mean a favorable end on russia's terms for example more than half say that if
15:22peace can't be reached yet russia should hit ukraine even harder but that exhaustion simply means that
15:28people think russia should step up the attacks while there's no one actually there to do the attacking
15:33mobilization has slowed in early 2026 with contract recruitment reportedly falling around 20 percent
15:40compared to 2025 as signups become harder to sustain and when the population is that tired and passive
15:47it's also much more likely to resist an open mobilization which would arguably be russia's only
15:52tool of getting enough manpower to finish the war on its terms number eight the country is physically
15:59falling apart russia's basic infrastructure hails from the soviet era and it hasn't been kept up with the
16:05times so when the war came and the budget got strained the government tried to do its best to
16:10tighten its belt by reducing already sporadic maintenance the winter of 2023 into 2024 brought
16:17the worst wave of breakdowns in two decades with heat and water cutting out for potentially millions
16:22of people in the dead of winter and in january 2026 alone russia logged nearly 1800 separate
16:29disruptions to electricity water and heating roughly double the same month a year earlier
16:34and here's the insult on top of the injury even as the pipes burst the bills go up utility tariffs
16:41jumped an average of 12 percent in mid 2025 more than 20 percent in some regions hitting pensioners
16:48and the rural poor hardest even the more recent infrastructure is falling this time to russian
16:53propaganda in an effort to protect itself from drone attacks the russian government has taken to
16:59systematically removing internet access across the regions closest to ukraine while holding vital
17:04military targets it also started banning the widely popular social media app telegram replacing
17:10it with a domestically made bootleg max but the latter has been found to have severe security
17:15issues to the point where the government also suggested soldiers return to telegram instead
17:21you can see why this is politically radioactive russians can tolerate a war fought by nameless
17:26people coming from poor regions but when that war is directly cutting into the
17:31heat supply for the far-off regions or the internet access in the large population centers it's subtly
17:36much harder to ignore the kremlin's plan for this has been to modernize using foreign investments that
17:42are no longer coming and ukraine has started rolling out more long-range weapons which means the internet
17:48shutdowns will only get bolder as the government tries to contain the news but all that effort is only
17:53partial since a lot of it gets eaten up by the system number nine corruption eating the war machine
18:01every ruble russia spends on this war passes through one of the most corrupt systems on earth and a
18:06staggering share of it never reaches the front before the war analysts estimated that as much as
18:11two-thirds of the value of state contracts could be siphoned off total corruption losses ran to a more
18:17than a third of budget revenue around 6.2 percent of the entire economy then the war created more
18:23defense contracts fortification budget and soldier payments all of it ripe for theft in spring 2024
18:31the kremlin launched a dramatic purge of the defense ministry arresting senior officials it opened
18:36criminal cases over stolen money in the border regions of kursk bryant and belgaret the same regions
18:42that were supposed to be fortified against ukraine but these anti-corruption campaigns aren't meant to
18:48stop the stealing they're meant to simply replace the recipient with someone more malleable
18:52and in line with the current program while keeping everyone else loyal through fear which paradoxically
18:58makes the system more unstable not less when the rules are arbitrary and your protection can vanish
19:03overnight the smart move is to grab as much as you can as fast as you can so the theft
19:09accelerates
19:10until there's nobody left to do the stealing except one number 10 the center of russia which brings us to
19:18the weakness that sits underneath all the others the one that explains how russia ended up here in the
19:23first place russia is not really a government it's one man surrounded by people whose entire job is to
19:29agree with him putin makes the big decisions alone in secret consulting only a tiny circle there's no real
19:36debate no independent check and few people whose careers survive telling him something he doesn't want to
19:42hear loyalty matters more than competent and in a system like that everyone tells the boss what he
19:48wants to be true this has had massive consequences that dramatically affected the duration of the war
19:54many analysts believe putin went into this invasion confident it would be over in days
19:59for years he'd been telling that russians and ukrainians were one people that ukraine sat on historically
20:05russian land that its government was a hollow western puppet that would collapse the moment russia pushed
20:10he believed russia would be hailed as liberators in july 2021 he delivered a long essay denying
20:16ukraine's existence as a genuine nation which was then made required reading for the russian military
20:21and when russian intelligence services went looking for the current state in ukraine
20:26they already knew the answer the boss wanted the fsb fed the kremlin reports that ukrainians wouldn't
20:31fight that key would fall in days and that russian troops might even be welcomed so russia launched the
20:38largest war in europe since 1945 based on intelligence that had been basically manufactured to flatter
20:44putin nobody in the room could say mr president this is wrong and that same system runs both the
20:50country and the war council arguably the worst part is that everything depends on putin personally
20:56without a successor or a mechanism for what happens when he's gone if something happens to putin and
21:02given his advanced age that something is becoming increasingly likely russia might enter a free-for-all
21:08for the remaining ruling class but what's left of the government to strip it for parts but perhaps
21:13the biggest problem is that all these effects are feeding one another to the point where the war is
21:18no longer as consequential if the war stopped tomorrow russia would still be devastated to learn more
21:24so check out this video and make sure to subscribe to the military show for daily news on global events
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