A help­less gi­ant

Mid­dle class plays an im­por­tant role in the so­cio-eco­nomic struc­ture of mod­ern Ukraine. Still, it re­mains an ob­ject in the politi­cal strug­gle of oli­garchs

The Ukrainian Week - - ECONOMICS - Olek­sandr Kra­mar

Ukrainian mid­dle class and SMEs have long been the sub­ject of Ukrainian politi­cal strug­gles. Politi­cal forces have in­creas­ingly de­clared the pro­tec­tion of their in­ter­ests as part of their plat­form. They are the source of hope for the coun­try's eco­nomic and politi­cal devel­op­ment. At the same time, the term “mid­dle class” re­mains vague in Ukraine, and so does the def­i­ni­tion of small and medium busi­nesses, their size and weight in the econ­omy, as well as their in­ter­est un­known. As a re­sult, the mid­dle class and SMEs, not to men­tion the pro­tec­tion of their in­ter­ests by politi­cians, be­came a myth, while they turn into a pas­sive ob­ject amidst politi­cal in­fight­ing.

DE­CEIT­FUL TERMINOLOGY

In the West, there is the "old" mid­dle class (own­ers of small and medium busi­nesses that di­rectly man­age them) and the "new" one (mid­dle in­come em­ploy­ees). In terms of in­come, mid­dle class is di­vided into “up­per” and “lower” groups. This divi­sion is mostly clear in Ger­man-speak­ing coun­tries, which, un­like the English or French speak­ing coun­tries, use two dif­fer­ent terms to de­fine mid­dle class.

AS LONG AS UKRAINE’S SMEs ARE NOT AWARE OF THEM­SELVES AS A CLASS WITH ITS OWN IN­TER­ESTS AND PO­TEN­TIAL, IT IS DOOMED TO ACT AS AN AP­PENDAGE TO THE OLIGARCHIC SYS­TEM

"Small and medium-sized en­ter­prises" (SMEs) have their coun­ter­part in the Ger­manspeak­ing coun­tries: "Kleine und mit­tlere Un­ternehmen" (KMU). How­ever, the lat­ter term is sim­ply a sta­tis­ti­cal rank­ing of com­pa­nies by the num­ber of em­ploy­ees and an­nual turnover. It does not take into ac­count that sev­eral, or some­times even dozens or hun­dreds of such com­pa­nies, may be­long to the same owner or be in pub­lic or col­lec­tive own­er­ship. That is, the govern­ment, an oli­garch or a bil­lion­aire can re­al­is­ti­cally be an owner of SMEs in Ukraine (and else­where).

All this com­pli­cates the as­sess­ment of the "old" mid­dle class or SME own­ers in the so­cial and eco­nomic life of any mod­ern coun­try. All avail­able data on the role of small and medium busi­nesses in any coun­try, be it in Europe, in Ukraine or else­where in the world, are based solely on the sta­tis­ti­cal cat­e­gory of "SMEs," which, for the above rea­sons, can dis­tort the un­der­stand­ing of the role of small and medium en­trepreneurs, for ex­am­ple, in a coun­try like Ukraine.

It is for the lack of ad­e­quate sta­tis­tics that the weight of the "old" mid­dle class in the so­cial struc­ture is not an­a­lyzed in the world. In­stead, the fo­cus is made on the divi­sion of the mid­dle

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