Poverty and inequality in the light of modern approaches to overcoming Russian poverty

The subject of the article is the phenomenon of poverty in light of the problems of excessive economic inequality, which is the main source of formation of Russian poverty, and indicative of institutional analysis which involves a critical revision of social-economic policy of the state instead of the official way of dealing with this problem without considering the reasons of its formation (targeting of poverty). The aim of the work is to update the cause-and-effect factors of poverty formation in Russia, the main of which is a critically high level of inequality with an assessment of the role, nature and causes of its causes. The hypothesis of the study is the thesis that the fight against poverty is ineffective based only on increasing the number and level of social payments and social programs, without taking into account the causes of poverty, thus not affecting any socio-economic processes for its formation. Meanwhile, both the indicative and institutional approach to the analysis of the main causes of poverty shows the dominant role of excessive inequality in the formation of the problem of Russian poverty. In turn, inequality is caused by the inefficiency of the state’s distributive and redistributive policies, caused by the lack of scientific conditionality and systematic political decisions.


Introduction
Russia is a rich country with a poor population. Poverty in the modern Russian economic situation has become a large-scale and critical macroeconomic problem that is at the centre of socio-economic reforms. Accordingly, the number of political statements about the urgent need to reduce poverty is clearly increasing, including the instruction of Russian President Vladimir Putin in his Address to the Federal Assembly dated January 15, 2020 on the need to reduce poverty in Russia by 10% in 2020 (in the May decree of the President of 2018, the task was set to achieve a twofold reduction in the poverty level by 2024). However, the proposed approach to poverty reduction is clearly extremely framework-based or point-based, non-systemic in nature, by analogy with an equally narrow anti-inflationary policy. In this regard, the president said that "...we must target poverty, do it the way we targeted inflation".
According to the President's concept, such targeting should be based on increasing the number and level of social benefits and social programs, without taking into account the causes of poverty, thereby not affecting any socio-economic processes for its formation. At the same time, the modern analysis of poverty suggests that this problem is primarily caused by the excess of inequality, which is formed, inter alia, due to the negative regulatory role of the state in conducting socially effective distributive and redistributive policies. As a result, there is a steady expanded reproduction of poverty, which, according to various estimates, includes up to half of the population of Russia, despite the fact that the phenomenon of poverty itself remains insufficiently ambiguous. 3 Report 2019, developed by the United Nations Development Program, about 5.7 billion people demonstrate multiple factors of poverty on 10 indicators in the field of education, health and living standards in 101 countries when calculating the "multidimensional poverty index" [7]. At the same time, the main component remains the extreme material limitations of life, high correlations with which are precisely demonstrated by the parameters of poverty in education, healthcare, housing and communal services, etc.
Thus, only the deficit of monetary income in low-income households (with incomes below the subsistence minimum) is slightly more than a trillion roubles, or about 3.5% of the monetary income fund of the 10% of the most affluent groups of the population [8]. A slightly larger estimate of the deficit is given by the Ministry of Labour and Social Protection of the Russian Federation, saying that "Russians lack a total of about 750-800 billion roubles of income so that the poverty level in the country becomes zero" [9], which indicates an average shortage of about 38 thousand roubles per person per year or about one average monthly salary.
However, the problem in the income deficit of the poor is not so much in its critical size, as in the fact that this amount of the wage deficit cannot be provided for mainly by the working, able-bodied poor, since according to statistics, the largest part of the poor in Russia are working people of working age -more than 58%. There are only 12% of pensioners among the poor, while there are about 25% of them in the population structure [10]. All this indicates a high level of influence of the policy of distribution and redistribution of income on the level of poverty.

Results and Discussion
A significant role in this process is played by the state, which establishes and maintains an appropriate critical minimum wage level. So, the minimum wage in the Russian Federation at the moment is -12798 roubles, or $ 166, which is much lower than in a number of other countries (Brazil -$ 211.81, China -$ 378.15, Argentina -$ 241.88, Iraq -$ 293.04, Iran -$ 264, Turkey -$ 481, etc.) [11]. Despite the fact that the minimum wage in our country is 4.7 times lower than the average, while in the above countries it is only 2-2.5 times, and this is despite the fact that according to various estimates, 10-12% of the population of our country receives wages below the subsistence minimum. As a result, poverty in these countries is much less widespread, although the level of economic development in most of them is noticeably lower (by 1.5 -2 times) than in Russia [12].
The reason for such a strong discrepancy between the economic opportunities of a country and the level of poverty of its population lies in the strongest polarization and income inequality. Although poverty and inequality are traditionally considered as two independent negative socio-economic processes, however, they are deeply interrelated phenomena, which are declared, among other things, by the Director General of the ILO: "inequality is the main reason for the decline in the income of most families..." [13]. This is also confirmed by studies of domestic experts who prove that it is impossible to reduce the level of poverty without reducing inequality [14]. Their forecast calculations show: "... if the real incomes of the population grow at an average annual rate of 8-10%, and the income distribution mechanisms remain the same, then a twofold reduction in the number of poor people in the country as a whole can be achieved at best only in seven years". It should be noted that the real incomes of the population have been consistently declining in recent years. In 2014-2018, real disposable income decreased by 10.5 %, real accrued wages -by 4.5%, the real amount of assigned pensions-by 6% [15]. Thus, in reality, poverty and inequality are links in the same chain that are inextricably interrelated and without solving the problem of inequality, the situation with poverty is unlikely to leave the field of declarative tasks.
The various facets of the negative impact of inequality on the socio-economic development of society are well covered by scientists. Inequality has an absolute and relative impact on a wide range of socio-economic indicators. Thus, numerous studies have shown a direct link between the nature of income distribution and economic growth. At the same time, for a certain level of inequality, an increase in the welfare of the poor and middle class by 1 percentage point can lead to an increase in GDP growth by 0.38 percentage points [16], according to other estimates, a decrease in inequality by 1 point (according to the Gini coefficient) in Russian conditions will lead to an increase in aggregate economic growth by 0.8 percentage points [17]. On the other hand, a narrow increase in the concentration of household income is accompanied by a decrease in the growth rate of household deposits, investments, a decrease in the level of confidence in business and measures aimed at supporting entrepreneurship, insufficient investment in human capital, which means a decrease in the birth rate and life expectancy, etc.
Inequality has a huge impact on social processes, including the growth of authoritarian tendencies in management, the scaling of corruption, an increase in the level of nervousness, instability and aggressiveness in the country [18], and hence the growth of crime. Thus, about half of the crimes in Russia are of a property nature, and among the persons who committed the crime, 65.9% did not have a permanent source of income [19].
Due to the aggravated consequences of the critical state of inequality in Russia, this problem is qualified as the most significant internal threat to the state, because when "growth is not evenly distributed, but only a small handful of people become fabulously rich, then the power of the rich poses a risk to the well-being of everyone else" [20]. This risk is extremely high for Russia, since the country has become a leader in the world in terms of a limited concentration of income and property. According to the Global Wealth Report for 2015, 1 % of Russians account for 71 % of all assets of individuals in Russia. In the world as a whole, this indicator is 46 %; in Africa -44; in the USA -37; in China and Europe -32; in Japan -17 % [21].
According to experts [22], the incomes of the wealthiest Russians are growing by 70-90% per year -at a rate absolutely unattainable for poor compatriots, despite the fact that these incomes do not participate in the subsequent redistribution through charity or otherwise. Thus, according to the World Bank, Russia ranks 5th in the number of dollar billionaires on the planet (108 billionaires, whose total net assets amount to $ 342 billion) and 127th in charity (according to the Charities Aid Foundation "World Charity Rating 2012") [23].
At the same time, the state in Russia practically does not regulate differences in the income of the population in the interests of ensuring sustainable economic growth and social well-being of all segments of society, wrongly believing that large-scale poverty can be overcome without addressing issues of social differentiation [15]. The reason is rather that the state policy on this issue is based on neoliberal and neoclassical models of the economy, for which the scale of inequality is formed as a result of the combination of natural economic processes and the minimal impact of state income redistribution.
In relation to the first, economic inequality, from the point of view of scientists, is an objective result of market processes. Modern models describing the trends of inequality growth, including the Athenian welfare model, the model of A Chakraborty, etc., demonstrate the inevitability of the formation of a situation of inequality or, more precisely, the consistent concentration of property in one hand in any chain of transactions. Under these conditions, "the natural distribution of wealth of an uncontrolled market economy is an absolute oligarchy" [24], this, against the background of a high level of "overproduction of elites" [25], is the most important source of the economic and sociopolitical crisis of society. The growth of inequality is objectively promoted by the law of preferential growth of income on capital over economic growth [26], providing a preferential growth of income from property, significantly outstripping the growth of income from the labour factor. In Russia, this law manifests itself most clearly, because, as experts note [27], the money capital of the oligarchy is growing and increasing regardless of economic crises or production growth, an increase in its technical level or extremely low innovative development.
The state redistributive policy is designed to correct the objective processes of inequality growth, but the nature of its implementation remains extremely imperfect in many respects. The modern Russian redistributive process was most clearly reflected by M I Weller as "Income is now redistributed so that the top receives as much as possible, and the bottom is given as little as possible" [28]. As a result, another source of inequality is recognized as the state policy of income redistribution, about which Joseph Stiglitz wrote: "There is inequality.... It is a consequence of the failures of the political system, and it leads to an increase in the instability of our economic system" [29]. This is also echoed by the study of T Piketty, who claims that political factors have a great influence on the dynamics of inequality [30]. The nature of such influence is manifested both in the current mechanism of redistributive policy, and in the nature of using the possibilities of its adjustment to reduce inequality, which is determined by the quality of the political institutions prevailing in society. It is the quality of the institutional environment, or rather the effectiveness of the mechanisms of public administration that determines the subsequent result of socio-economic processes of overcoming inequality. Experts note that "the Russian policy of income redistribution is ineffective either in terms of the tax mechanism or in relation to transfer payments, and is also not adaptive to the existing realities" [30]. The proof of this is, on the one hand, the abolition of progressive taxation since 2001 (Federal Law No. 117 of August 5, 2000). Experts [31] emphasize that the differentiation of Russian society by income is closest to the American type, but in contrast to the flat Russian tax scale, a sixstep income tax scale is used in the United States (from 10% to 40%, depending on income). The potential use of the American tax rate of 40% in domestic practice would ensure the receipt of more than 1 trillion roubles to the budget.
On the other hand, the state maintains an extremely low level of the minimum wage, thereby preserving the problem of inefficient low-paid employment. The Keitz index (the ratio between the minimum and average wages) in Russia, as of 2019, is about 23.5 % (the minimum wage is 11280 roubles and the average is 48030 roubles), despite the fact that in the OECD countries the Keitz index does not fall below 40 % [6].
The main problems of inefficiency of redistributive policy are associated with the lack of scientific conditionality and systematic political decisions related to the formation and functioning of the mechanism of redistribution, for which there is not even a generally recognized criterion for quantitative assessment. As a result, the basic value principles of the distribution and redistribution policy are poorly institutionalized, as a result of which the practical methods of implementing this policy are internally contradictory, inconsistent and more dependent on lobbying and populist goals of the political process.
The change in the situation, both in the world and in Russia, is associated [16] with a deeper and more systematic work of state bodies on the basis of rational political reforms and the use of other methodological support. Thus, in the field of combating poverty and inequality, new qualitative assessments of the inequality of economic development and other conceptual approaches to understanding and analysing the interrelation of all components of socio-economic processes in society that form the trends of growth of differentiation and inequality are needed.

Conclusion
Thus, poverty and inequality have become the most acute manifestations of the crisis of the modern development of society, while in official policy, if they recognize the importance and necessity of fighting poverty, then beyond its connection with inequality. At the same time, even international sources [32] massively recognize the criticality of the Russian situation with inequality, which leads to a deterioration in the economic situation of the country's population as a whole. Experts recognize the significant role of the effect on the flow of income from the poor to the rich. Thus, according to their estimates, with an average increase in the income of the Russian population over the past 20 years by 34%, the poorest 50% of citizens' incomes fell by 26%, the next 40% of incomes increased by 5%, but 10% of high-income Russians increased by an average of 190% (almost 3 times). At the same time, the income of the top 1% increased 8 times, the top 0.1% -26 times, the top 0.01% (there are no more than 10 thousand people in Russia) -80 times, the top 0.001% -an increase of 250 times.
The low income growth of the population of the Russian Federation as a whole (with a global trend for the same period -an increase of 64%), accompanied by a catastrophic stratification of society, consistently exacerbates the problem of overcoming large-scale inequality. However, the Russian version of the fight against poverty is proposed to be implemented only through targeting, i.e. through private measures of financial support for the poor. Meanwhile, the severity and chronicity of the problem of poverty, both in the world and in Russia, poses the task of a deep analysis of the causes and mechanisms of the formation of poverty and inequality. The latter is associated to a greater extent with the inefficiency of the distributive and redistributive policy of the state. Apparently, in this regard, it is proposed to replace the traditional perception of income redistribution as a universal mechanism for combating poverty with a policy "to expand and distribute both opportunities and income before, during and after active participation in the economy" [33], i.e., a deep, systematic causal coverage of understanding and evaluation of all components of socio-economic processes in society.