Inflation traps residents of Russia’s northern climes

Dreams of saving money in Russia’s barren Arctic to buy a home and retire to the temperate south have perished in the grim reality of inflation.

Officials say more than 800,000 of the Russian Arctic’s 1.5 million people are trapped in the dismal bleakness of frontier mining towns, their savings — accumulated after decades of hard, often dangerous labor — wiped out by hyperinflation.

The latest signal of local unhappiness was reflected recently in a one-day strike by coal miners demanding pay rises.

The first “settlers” in this harsh land — where the sun goes down each noon in December — were political prisoners, sentenced to terms in gulags built under Stalin in the 1930s.

Later, miners were enticed north by higher-than-average wages. But while the monthly pay is about 45,000 rubles, it now costs about 450,000 rubles just to move out and three million rubles to buy a flat, according to Vorkuta Mayor Alexander Segal.

Miners and their families are skeptical about a government land give-away program offering up to 1.7 million hectares in central and southern Russia to resettle northern workers.

They say the land is being taken up by private companies and wealthy individuals who plan to set up agricultural empires where they would hire and house the thousands of northerners wishing to move south.

Miners say they prefer the choice they had under communism — to move where they wanted.

“Russia for Arctic” is one of the successful companies running the give-away program.

It has already received about 320,000 hectares of land and plans to build agricultural enterprises and communities, according to Nikolai Karasyov, a former Vorkuta banker and a director of the Rusdom Bank, which helps fund “Russia for Arctic.”

The program is supported by the leadership of the Independent Miners’ Union, Russia’s first independent union, whose strikes in 1989 helped launch the reform process in the country.

But in Vorkuta — 1,200 miles northeast of Moscow and 60 miles above the Arctic Circle — local union officials and coal mine directors oppose the program, saying that it has yet to resettle anyone.

Some coal mines are initiating their own competing agricultural enterprises to resettle their old workers on free state land.

“There’s a big difference between plans in Moscow and real life,” said Anatoly Marmalukov, deputy chairman of the local union.

“We don’t trust this program.” Most miners, he said, would prefer to receive money to move themselves.

However, Viktor Utkin, a Russian parliament deputy and a leader of the Independent Miners’ Union, supports the resettlement.

“Once our program succeeds elsewhere, Vorkuta miners will be quick to support it,” he said.

Nikolai Karelin, a Vorkuta coal mine chief engineer who earns 120,000 rubles per month, said that despite his above-average pay he cannot afford to move. He said that with hyperinflation, saving part of his income no longer makes sense. Instead, he spends his rubles on electronic goods.

Mayor Segal says 40,000 of Vorkuta’s 220,000 population are desperate but unable to leave, occupying flats needed for new workers. Many of them are pensioners who were expected to retire elsewhere.

Flats are scarce and expensive in a town where for most of the year it is too cold to build and snow is common from August to May.

Several hundred people are waiting for flats but many are having to live in barracks built under Stalin’s rule.

“People are really trapped,” said one city official. “They have enough to eat but never enough to leave. The state does not want to solve this problem.” — From Inter Press Service.