Officials Warn Putin That War Spending Risks Budget Crisis

Summary

Bloomberg reports that senior Russian officials have warned President Putin that war spending in Ukraine is on an unaffordable path, with the budget deficit already larger than the full-year forecast. Tony Halpin discusses the tension between finance officials seeking cuts and defense officials demanding more funds, and the potential impact on pensions and social spending.

• Russian officials have warned Putin that current war spending levels are unsustainable.
• The budget deficit has already reached 2.5% of GDP, 50% larger than predicted for 2025.
• Putin has told officials not to cut defense spending, forcing them to look elsewhere.
• Potential cuts include pensions, health, education, and infrastructure.
• Pensioners are a key support base for Putin, making pension cuts politically difficult.
• Russia carried out a large-scale drone and missile attack on Ukraine overnight, killing at least nine people.
• The reporting highlights internal divisions within the Russian government over fiscal priorities.