Thursday, April 29, 2010

The Russian Silicon Valley: Update

What a shocker! Turns out the Russian "system" for defense spending is rife with corruption. From NRO:

Recently, Russian president Dmitri Medvedev announced that the Kremlin would spend 4–10 billion rubles ($134–335 million) to establish a Russian analogue of California’s Silicon Valley....

Several sites in Russia were in the running for this project, among them the Siberian “science city” of Tomsk, where the company NPF Mikron produces complex radars for the latest Russian fighter, the MiG-35 — one of the Russian defense industry’s few real success stories from the last several years. But, to the dismay of many defense-industry observers in Moscow, the final decision by Medvedev was to build this new R&D center in the Moscow suburb of Skolkovo.

..."It is almost certain that large portions of this money will be stolen — like with the Superjet — and siphoned off in the process of creating this new scientific complex." And the land in Skolkovo, which the government is expected to buy for $20–25 million per hectare (a hectare is roughly 2.5 acres), just happens to belong to a government official.

My prior criticism of the project - that it's difficult to enact innovation through government spending - didn't even consider this aspect. Of course the project is doomed.

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