OPINION: Four to five trillion rubles more — Moscow burns its future

OPINION: Four to five trillion rubles more — Moscow burns its future

Introduction: The number that says it all

A war budget that is exploding

Allow me to begin with a number that should shock more than it does in Western media: Russia will increase its military spending by 4 to 5 trillion additional rubles in 2026, according to Bloomberg via Ground News on June 23, 2026. Roughly 50 to 60 billion dollars in additional war spending, on top of a level that was already at a record high. In a country whose budget deficit already exceeds 80 billion dollars, as established by United24 Media on June 23, 2026. In a country whose government bonds are falling and whose benchmark interest rate has hit 21%, according to the Moscow Times on June 22, 2026.

I am not an economist. But I know how to read a balance sheet. And what these numbers say is that Vladimir Putin is financing his war by methodically burning the economic future of Russia. Not his own future — he will not be around to answer for it. The future of the generations that come after him. Of young Russians who did not choose this war and who will be paying its bill for decades.

What "burning the future" actually means

When a state spends massively beyond its revenues to finance a war, it pays in several ways. It drains its accumulated reserves — the Russian National Wealth Fund, considerably reduced since 2022. It borrows at high rates, creating debt that its citizens will repay. It prints money, feeding inflation that gnaws at the purchasing power of its population. And it sacrifices investment in education, health, infrastructure — the human and physical capital that determines future prosperity.

These are exactly the dynamics playing out in Russia since 2022, accelerating with the announcement of 4 to 5 trillion additional rubles. The Kiel Institute, cited by the Foreign Affairs Forum on June 23, 2026, speaks of "structural exhaustion." That is the academic term for what I have just described in plain language.

The ruble, inflation, and the slow destruction of Russian purchasing power

Inflation as a hidden tax on the poor

Inflation in Russia remains high, driven upward by massive military spending that injects money into the economy without a corresponding productive counterpart. When the state pays soldiers and arms factory workers inflated salaries with wartime bonuses, but those salaries generate no additional consumer goods, the mechanical consequence is inflation. Money chases the same available goods, prices rise, real purchasing power shrinks.

For less affluent segments of the population — those who depend on fixed salaries in the civilian public sector, retirees whose pensions do not keep pace with inflation, workers in sectors that do not benefit from military bonuses — this inflation is a silent but real impoverishment. It is a way for Putin to make his own population pay for the war without their seeing it clearly: not through an explicit tax, but through the gradual erosion of their standard of living.

The 21% benchmark rate: who it really penalizes

The Bank of Russia has maintained a benchmark interest rate of around 21% in an attempt to contain inflation and defend the ruble. This rate is among the highest of any major world economy. Its effect is to make credit prohibitive for businesses and households that want to borrow to invest or consume. Small businesses cannot finance their growth. Households cannot access affordable mortgage loans. The productive civilian economy is drained dry.

Only the military-industrial sector, financed directly by state contracts on terms not dictated by market rates, escapes this constraint. A dual economy is taking shape: a war sector prospering on state injections, and a civilian sector withering under prohibitive rates. This is not an efficient war economy. It is a destructive war economy that is eating its own foundations.

Russia's regions: the real victims of the war economy

When Moscow plunders the regions

Russia's war economy does not hit equally. Moscow and Saint Petersburg concentrate wealth, capital, and defense contract beneficiaries. Peripheral regions — those providing the bulk of the soldiers, those suffering the most from human losses — face double pressure: pillaging of their budgets by the federal government and the loss of their youngest workers, mobilized or killed in Ukraine.

According to dn.gov.ua on June 22, 2026, Russian regions are drowning in debt because of the war. Federal transfers to the regions have been cut to finance central military spending. Regional governors are managing growing deficits with reduced resources. Some regions are borrowing at high rates to maintain basic services. This is a political time bomb: as regional public services deteriorate, the frustration of local populations grows.

The geography of death and debt

Human losses in Ukraine are not socially homogeneous. Russian soldiers come disproportionately from poorer regions — Buryatia, Dagestan, Tula, regions of the Urals and Siberia — drawn by military bonuses that sometimes amount to ten times the local wage. These same regions are seeing their budgets cut and their debt increase. The correlation between "sending the most soldiers" and "receiving the least economic compensation" is politically explosive — assuming the population has any means to express it.

Official Russian propaganda maintains the myth of a just and consensual war. But in the villages of poor regions where coffins arrive regularly, where health services are degrading, where public transportation is cut for lack of budget — this myth is growing increasingly hard to sustain. I do not know whether this will translate into political opposition. But the objective conditions for that opposition are accumulating.

Russia's public debt: a mortgage on three generations

How much has already been spent?

Since the start of the full-scale invasion in February 2022, Russia has committed hundreds of billions of dollars in additional military spending. The National Wealth Fund, which formed the state's main financial cushion, has been substantially drawn down. Public debt has increased. And with the 4 to 5 trillion additional rubles planned for 2026, this trend is accelerating.

This spending is not "lost" in the sense that it finances real soldiers, real tanks, real ammunition. But it creates no durable productive economic value. A tank destroyed in Ukraine has not contributed to the productivity of the Russian economy. A soldier who died at the front leaves a void in his family and in his home region. The billions spent on ammunition will not fund tomorrow's pensions or the next generation's infrastructure.

What future generations will repay

The debt created by this war will be repaid — if Russia survives this conflict in some form, if financial markets trust it again, if productive investment resumes. These conditions are all uncertain, but assume they materialize. Even in this optimistic scenario, the Russian generations arriving in the coming decades will inherit massive debt, degraded infrastructure, human capital impoverished by death and exile, and a destroyed international reputation.

That is what "burning the future" means. It is not a metaphor. It is a precise description of what Putin is doing to Russia with his 4 to 5 trillion additional rubles in war spending in 2026. He is buying time for his war with the money of his successors and their children.

Sanctions: the lock that holds

The 21st package: every layer counts

In this context of an exploding war budget and a structurally exhausted economy, the maintenance and strengthening of Western sanctions is of paramount importance. The 21st sanctions package proposed by the EU, according to Daily Finland on June 27, 2026, and the extension of the entire sanctions regime through 2027, confirmed by Euromaidan Press on June 26, 2026, follow a logic of progressive strangulation.

Each additional sanctions package seeks to close the circumvention circuits identified in previous packages. Russia is creative in finding alternative routes — third-party countries, shell companies, non-dollar currency transactions. But every additional closure raises transaction costs, reduces margins, and complicates financing of the war effort. It is a Sisyphean task, but a necessary one.

The oil embargo: the potential killing blow

Baltic states' pressure to accelerate the Russian oil embargo, reported by Kyiv Post on June 27, 2026, identifies the most powerful economic weapon still available against Russia. Oil revenues represent a considerable fraction of Russian federal revenues. An effective embargo — one that closes alternative markets like India and China, or that imposes penalties on companies buying Russian oil — strikes directly at the financial nerve of the war.

This is not possible today, for lack of consensus within the EU and due to the commercial interests of certain member states. But the dynamic is in motion. Every additional month of war, every new sanctions package, every atrocity documented in Ukraine strengthens the camp of those who want to go further. The economic history of this conflict has not yet been written.

The oligarchy and the war: who is really profiting?

The winners of Russia's war economy

If ordinary Russians and peripheral regions are paying the price of the war, there is one category that profits from it: actors linked to the military-industrial complex. Companies that produce tanks, ammunition, missiles, drones — Rostec, Uralvagonzavod, Almaz-Antey and others — benefit from massive public contracts, priority access to raw materials, and privileged access to state credit. Their leaders, often close to power, are enriching themselves in the shadow of the war.

This class of war beneficiaries has an obvious interest in the continuation of the conflict. It forms a political support base for Putin that goes beyond ideological nationalism: an economically vested base whose prosperity depends directly on the continuation of the war effort. This is one reason why scenarios of a negotiated exit from war at Russian initiative are more complicated than they appear: powerful economic actors have an interest in the war continuing.

War corruption: a waste multiplier

Russia's war economy also suffers from a structural problem afflicting all partially planned economies: corruption. Documented reports — sometimes from Russian sources themselves — indicate that funds allocated to the war effort are siphoned off at every level of the supply chain. Ghost equipment billed, inferior quality substituted for contract specifications, combat bonuses not paid to the families of fallen soldiers — corruption is an invisible tax on Russian military efficiency.

This phenomenon is not new in the Russian military — it has been documented for decades — but it takes on particular scale when budget flows become massive. The 4 to 5 trillion additional rubles announced for 2026 will not translate into 4 to 5 trillion of additional military capacity: a significant portion will be absorbed by systemic corruption. This is a mitigating factor of the Russian war economy's power that analysts must include in their assessments.

International aid to Ukraine: the other side of the equation

What the West has provided in absolute figures

Analysis of the Russian war economy would be incomplete without mentioning the other side of the equation: international aid to Ukraine. Since 2022, Western allies have provided Ukraine with tens of billions of dollars in military, financial, and humanitarian aid. The Kiel Institute — whose analyses of aid to Ukraine have become the reference — has documented this flow with precision. This aid has allowed Ukraine to maintain its economy, fund its public budget, and fight against an adversary economically far larger.

The combination of economic pressure on Russia and economic support for Ukraine is at the heart of Western strategy. It aims to reduce the gap between the two belligerents' capacities — a gap that, without this support, would be overwhelmingly in Russia's favor. Maintaining and increasing this support for Ukraine is therefore intrinsically linked to the economic strategy targeting Russia's 4 to 5 trillion additional rubles of spending: the stronger Ukraine is economically, the more it can resist Russian military expenditures.

Allied economic coordination: still room to improve

The coordination of economic aid to Ukraine among allies remains a challenge. Overlaps, gaps, and differences in approach between American policy, European policy, and national policies create inefficiencies that more robust coordination mechanisms could reduce. Progress has been made — the creation of multilateral coordination platforms, the use of frozen Russian assets to fund Ukrainian aid — but room for improvement remains.

Coordinating sanctions, coordinating aid to Ukraine, coordinating investments in defense production: these three dimensions form a coherent whole that the Alliance should address as a single strategic problem, not as three separate files managed by three different bureaucracies.

Frozen Russian assets: an under-used economic weapon

300 billion euros working for Ukraine

Since 2022, approximately 300 billion euros of Russian Central Bank assets have been frozen in Western financial institutions, primarily in Belgium via Euroclear. These assets, representing a portion of Russian foreign exchange reserves accumulated before the sanctions, are frozen but not confiscated — which long remained a point of debate among allies. By end of 2024, the EU and G7 decided to use the interest generated by these assets — approximately 3 billion euros per year — to fund aid to Ukraine.

This decision is symbolically important and financially useful, but it remains insufficient. Advocates for more aggressive use of these assets — their full confiscation and transfer to Ukraine — argue that Russian aggression justifies this exceptional measure. Opponents fear legal and diplomatic precedents. This debate has not been resolved as of June 2026, and the 300 billion remains, for the most part, economic power waiting to be fully mobilized.

Conclusion: The economic countdown has begun

What the 4-5 trillion rubles really announce

The announcement of 4 to 5 trillion additional rubles in war spending for 2026 is not a declaration of strength. It is an admission of necessity. If the Russian army had the successes that propaganda claims, it would not need so much additional money. If ammunition and equipment were arriving in sufficient quantities, the budget would not be exploding. If human losses were manageable, bonuses and compensation would not be draining the treasury so severely.

These 4 to 5 trillion additional rubles describe a war that is consuming more than anticipated, for military results that fall below expectations. It is the arithmetic of failure, dressed up as military grandeur. And it is Moscow burning its own future to finance it.

What the West must do with this information

The information that the Russian economy is burning its future to finance an unsustainable war is not a reason to relax. It is a reason to intensify the pressure. The moment when economic pressure becomes decisive — when it forces the Russian regime into impossible trade-offs — may be approaching. Perhaps less close than one would wish. But it is inevitable if the course is held.

Maintaining sanctions, increasing aid to Ukraine, strengthening defenses on NATO's Eastern Flank: these are the three legs of the strategic tripod that can transform Putin's 4 to 5 trillion additional rubles into the economic epitaph of his war madness. The West has the means. Does it have the will? That is where, and only there, the real question lies.

By Maxime Marquette, columnist

Columnist's transparency note

Nature of this opinion piece and declared bias

This text is a personal opinion piece, with a more direct and engaged tone than a standard analytical article. I defend clear positions: sanctions are necessary and effective, Russia's rising war spending reveals the regime's difficulties, the West must maintain its pressure. These are my positions, explicit and assumed.

The economic facts I advance are drawn from serious sources dated the week of June 21 to 27, 2026, cited in the Sources section. I make no claim to economic expertise that I do not have. My role is to make data produced by experts accessible and to comment on it.

What I cannot state with certainty

I do not know precisely how long the Russian economy can hold under these conditions. Specialized economists have widely varying estimates. I also do not know whether economic difficulties will translate into political consequences, or on what timeline. The history of authoritarian regimes shows they can survive considerable economic hardship. I have explicitly acknowledged this in the article.

The figures I use are the best publicly available estimates at the time of writing. Later revisions are possible, notably for GDP and deficit data, which are often estimated with a lag.

Sources

Primary sources

Ground News/Bloomberg: Russia to increase war spending by an additional 4-5 trillion rubles in 2026 — June 23, 2026

United24 Media: Russia's budget deficit tops 80 billion dollars — June 23, 2026

Moscow Times RU: Russian government bonds collapse amid Kremlin plans to sharply raise war spending — June 22, 2026

dn.gov.ua: Russian regions drowning in debt because of the war — June 22, 2026

Secondary sources

Foreign Affairs Forum: Russia's war economy — Kiel Institute — June 23, 2026

The Economist: Russia's war economy has problems but is not about to crash — June 22, 2026

Euromaidan Press: Trade, banks, energy, crypto — the EU keeps its full Russia economic sanctions wall standing to 2027 — June 26, 2026

Kyiv Post: Baltic states push EU to accelerate Russian oil embargo — June 27, 2026