Old problems persist amid Russia’s fiscal boom

Jim Maceda Correspondent

MOSCOW - It's a big day for Natalia and Alexei Liventsev — they're buying their first car, a Ford Focus, $20,000 up front.

But these young Muscovites can afford it. They're part of a booming middle class that makes 15 to 20 times more than their parents did.

"Life has definitely improved," says Natalia Liventsev. "There's more stability, more money."

Under Russian President Vladimir Putin, much more money. Today's Moscow is the capital of glitz. The number of billionaires here is second only to the U.S.

Foreign-made luxury cars now cram the streets. Even in the shadow of what was once the KGB's headquarters, there's a Bentley dealership.

"A powerful economy means — first and foremost — allowing people to get rich."

It's a far cry from those days of long lines, empty pockets, and stale bread. Case in point?  Moscow's Filippov Bakery — a Soviet landmark — now a trendy coffeeshop.

The old pensioners have been replaced by young students, by Russian professionals — people who feel very comfortable coming here and spending $4 or $5 for a cafe latte, or $6 or $7 for a croissant.

But critics warn that Putin's new Russia still suffers from many of the old problems. Endemic alcohol and drug abuse — and poor health care — have reduced life expectancy here to just 59 years for men — lower than Bangladesh.

Putin has promised $3 billion on an 'anti-disease' program to buy drugs to fight an HIV/AIDS epidemic, TB and cancer. But reformers like Vladimir Ryzhkov, a liberal member of parliament, say Russia needs life support.

"The Russian population is slowing down very fast," Ryzhkov says. "We are losing about 700,000 every year.

Yet, on Red Square and elsewhere, Russians don't seem all that concerned about such issues.

"Everyone is buying new cars, new clothes and likes the way things ae right now," says Alexei Kagalov, a commercial artist.

One of a wave of new, prosperous Russians, just hoping the good times roll on.  

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