Russian authorities warn the country is on the brink of recession as military spending surges amid the invasion of Ukraine. Despite defying Western sanctions initially, the economy shows fatigue as labor shortages and inflation rise. Economic Minister Maxim Reshetnikov stated the wartime economy can no longer sustain growth driven by defense spending, which has nearly doubled since the invasion. The Kremlin's heavy investment in the military-industrial complex has spurred GDP and wage growth, but now faces hard limits, signaling a potential downturn.
Despite predictions of its imminent demise, the country's economy has held up fairly well by pursuing what economists call "military Keynesianism."
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