The Profits of Attrition

Russia’s war in Ukraine remains strategically wasteful even as it rewards many of the institutions, offices, and private actors responsible for administering it.^[1]

A war can fail as strategy yet persist as an institutional system, and that distinction has become one of the harder lessons of Russia’s war in Ukraine. The public record shows marginal advances bought at severe cost,^[2] whereas the internal economy of the war shows status protection, procurement flows, recruitment bonuses, death payments, missing-person proceedings, and extraction opportunities at the front.^[3] Russia’s war consumes the state’s strength at the same time it creates offices, contracts, and command positions through which officials, contractors, recruiters, and commanders can draw benefit from its continuation.^[4]

Russia remains dangerous because it holds territory,^[5] maintains manpower, controls weapons and energy revenue,^[6] possesses nuclear arms, and operates a state apparatus capable of absorbing losses that would strain many governments.^[7] The narrower point is that corruption should not be mistaken for imminent military collapse, because in several respects corruption functions as one of the mechanisms through which the Russian war system sustains itself.^[8]

The war persists for political reasons, and it also endures because the wartime economy rewards many of its administrators, binding territorial strategy to institutional profit.^[9]

I. The Map Must Move

Putin’s war aims remain territorial, and the Kremlin needs a moving map because the political system beneath him has been organized around the demand for visible acquisition. At the St. Petersburg economic forum in June 2026, Putin rejected Volodymyr Zelenskyy’s offer of direct talks and repeated Russia’s demand for Donbas, Kherson, and Zaporizhzhia, according to The Guardian.^[10] Reuters has likewise reported that Putin continues to insist that the war cannot end unless Russia controls all of Donbas, even though Ukrainian forces still hold part of Donetsk.^[11]

That demand establishes the political logic for every officer beneath him, since the regime has defined victory in territorial terms and therefore requires the front to show forward movement.^[12] A static line communicates failure, a retreat communicates something worse, and even a small or dubious gain can be made politically useful if it preserves the central fiction that Russia advances, Ukraine weakens, and time favors Moscow.^[13]

The battlefield gives a harsher account of that fiction, since Reuters reported that Russian forces captured only 82 square kilometers of Ukrainian territory in May 2026, compared with 94 square kilometers in April and 25 square kilometers in March.^[14] Russia Matters, using Institute for the Study of War data, found that Russian forces registered a net loss of 93 square miles of Ukrainian territory from May 5 to June 3, 2026.^[15]

The Center for Strategic and International Studies, known as CSIS, has described a broader pattern in which Russia has paid an extraordinary price for minimal territorial gains.^[16] By the Center for Strategic and International Studies estimate, Russian forces suffered roughly 1.2 million casualties between February 2022 and December 2025, even as their major offensives progressed at exceptionally slow rates.^[17]

These figures expose the central contradiction, because the Kremlin requires visible progress, the battlefield yields only incremental gains, and the bureaucracy converts those increments into official reports that turn delay into apparent momentum.^[18]

II. The Report Becomes the Battlefield

Battlefield reports ordinarily help political leaders understand reality, although Russia’s war has made them instruments through which political leadership can avoid reality. The Institute for the Study of War, known as ISW, has repeatedly identified inflated Russian battlefield claims, including Chief of the General Staff Valery Gerasimov’s April 2026 assertion that Russian forces had captured more than 1,700 square kilometers and 80 settlements since the start of the year.^[19] The Institute for the Study of War assessed that Russian forces had advanced only 381.5 square kilometers and seized 13 settlements over the same period, according to its April 21, 2026 campaign assessment.^[20]

The discrepancy matters because a false report creates an obligation inside the system after a commander claims progress, higher command repeats the claim, and the Kremlin absorbs the fiction into its political understanding of the war.^[21] Once that occurs, the system must keep acting as though the report describes reality, converting an inflated battlefield claim into a commitment that helps shape future operations.^[22]

The modern front makes that conversion easier, since Reuters has described a 1,200-kilometer battlefield shaped by drone warfare, small-unit infiltration, and difficult verification of control lines.^[23] In that environment, infiltration can be recorded as capture, a photograph can become proof, and a temporary presence can travel upward through the bureaucracy as an advance.^[24]

The map therefore functions as more than a record of the battlefield, becoming a political instrument through which the regime converts contested movement into reported momentum.^[25]

III. Attrition Creates the Money Stream

The territorial fiction would matter less if the war were inexpensive, yet the scale of Russian war spending has created a political economy of its own. The Stockholm International Peace Research Institute, known as SIPRI, estimated that Russian federal war and military spending reached about 16 trillion rubles in 2025, equal to 7.5 percent of gross domestic product.^[26] The planned 2026 figure fell to 14.9 trillion rubles, or 6.3 percent of gross domestic product, although the Stockholm International Peace Research Institute noted that the annual budget would probably be amended, as it had been twice in 2025.^[27]

A state spending at that scale creates a market in which weapons, drones, fuel, uniforms, housing, construction, medical support, death benefits, recruitment bonuses, debt relief, and soldier pay all become channels for money.^[28] Under wartime corruption, channels designed to supply the front can acquire a secondary purpose, giving the war a private economy that rewards those positioned near procurement, administration, and command.^[29]

That is why the Defense Ministry purge matters, since Reuters reported in 2024 that Putin’s personnel changes were intended to address inefficiency and corruption within the ministry and to improve fiscal transparency in Russia’s war economy.^[30] The personnel shuffle followed the dismissal of Sergei Shoigu as defense minister and the appointment of the economist Andrei Belousov.^[31]

Efficiency supplied the public language for the purge, yet the deeper struggle concerned competition over rents and control of wartime money.^[32] Carnegie described the Defense Ministry purge as an unprecedented dismantling of Shoigu’s clan inside the Russian elite, writing that the purge redirected rent flows associated with the ministry and disrupted established patronage networks.^[33]

The purge leaves the basic system intact while revealing the rules that govern it, since corruption can be protected for years, managed through patronage, redirected during elite conflict, and punished when political circumstances shift.^[34] The structure endures even as the beneficiaries change.^[35]

IV. The Purge Shows the Structure

The corruption cases are extensive enough to show a pattern rather than a sequence of isolated scandals. Radio Free Europe/Radio Liberty reported in April 2026 that investigators and prosecutors had targeted deputy defense ministers, senior officers, and top civilian officials for alleged corruption, fraud, and embezzlement after Shoigu’s ouster.^[36] Several of the most prominent cases involved figures believed to be close to Shoigu.^[37]

Ruslan Tsalikov’s case illustrates the scale, since Jamestown reported that the former first deputy defense minister was detained in March 2026 and that investigators treated long-running Defense Ministry corruption as the work of a criminal group.^[38] Other reporting described charges involving bribery, money laundering, embezzlement, and conspiracy.^[39]

Wartime spending creates the opportunity for corruption, and elite politics determines when that opportunity becomes a criminal case.^[40] Corruption remains a standing vulnerability that can be ignored while useful, exposed when convenient, and transferred when a new faction gains control of the flow, making each prosecution part of the same institutional system.^[41]

This pattern makes reform dangerous inside the system, because a genuine reformer threatens the income, protection, patronage, and survival that failure now supplies.^[42] Reform would impose a direct private cost on the men who benefit from waste by cutting off the payoffs that keep the system loyal.^[43]

V. Drones and the New Procurement Prize

The rise of drone warfare intensifies the problem by concentrating procurement and control within a single domain. Russia has formalized drone warfare through a new Unmanned Systems Forces branch, creating a structure for drone development, procurement, training, and deployment.^[44] Such centralization may improve coordination, though it also creates a point of control with obvious value in a war increasingly shaped by unmanned systems.^[45]

The appointment controversy around Yury Vaganov shows the risk. The Institute for the Study of War, citing BBC Russia and Russian drone-sector sources, reported that Vaganov had reportedly been appointed to command Russia’s Unmanned Systems Forces, although Russian authorities had not officially confirmed the appointment.^[46] Vaganov is a former businessman and reported major supplier of first-person-view drones to Russian forces, making the alleged appointment a useful illustration of how battlefield procurement needs and private supplier interests can converge inside Russia’s new drone bureaucracy.^[47]

Because Russian authorities have not officially confirmed the appointment, the available reporting supports careful inference rather than a settled institutional conclusion.^[48] Russia’s new drone command may bring procurement authority, battlefield requirements, and private supplier interests into close proximity, creating value for those able to control it and risk for the soldiers dependent on what it produces.^[49]

Procurement corruption shapes battlefield performance by affecting the equipment, timing, and quality of what reaches the front.^[50] Inferior equipment leaves soldiers exposed, delayed deliveries deprive units of needed systems, monopoly suppliers can weaken quality and slow adaptation, and false claims about production standards can get men killed.^[51] In a drone war, corruption in small systems can produce large tactical losses.^[52]

VI. The Soldier as Financial Object

The war’s money also moves toward the soldier, whose body becomes the object of contracts, bonuses, benefits, and claims. Russia has relied on high pay, bonuses, prisoner recruitment, foreign recruitment, tax breaks, debt relief, and other benefits to replenish forces while avoiding another large-scale mobilization.^[53] The Associated Press reported that regional enlistment bonuses can reach tens of thousands of dollars, with one Russian region offering about $50,000 in various bonuses, far above local average income.^[54]

In May 2026, Reuters reported that Putin signed a decree giving new Ukraine-war recruits and their spouses debt relief up to 10 million rubles if certain collection claims were already in force.^[55] The contract must last at least one year, tying the financial incentive directly to the soldier’s commitment to the war.^[56]

The French Institute of International Relations has called the resulting system “deathonomics.”^[57] Its 2026 report estimated that military salaries and death gratuities now reach 3 to 4 trillion rubles annually, close to 2 percent of Russia’s gross domestic product.^[58] It argues that wartime pay and death compensation have become a major economic stimulus in poorer regions and among low-income groups.^[59]

That shift alters the soldier’s status within the war economy, turning him into a fighter, a contract, a paycheck, a debt-relief claim, a family-benefit claim, a death-benefit claim, and a manpower statistic.^[60] To the state, he is a replaceable input, and for his family he may represent the largest payment the household will ever receive, with corrupt commanders able to treat him as another source of revenue.^[61] At that point, the war’s moral injury becomes an economic fact inside the system.^[62]

VII. Survival for Sale

Reports from the front describe a system in which survival becomes something a soldier may have to purchase from his commander. The Week, summarizing reporting from The Economist, The Telegraph, PBS, and other sources, described Russian commanders charging soldiers up to £30,000 to keep them from front-line postings.^[63] It also reported that wounded soldiers have been forced to pay to be declared unfit for combat and that soldiers may be forced to buy their own gear under the pretext of raising money for drones, equipment, or food.^[64]

The same account described more extreme allegations, including commanders requisitioning bank cards and personal identification numbers before sending soldiers into battle, then declaring dead soldiers missing and withdrawing money from their accounts.^[65] Those claims should be treated as reported allegations rather than established findings in every unit, although they correspond to the larger incentive structure through which commanders control danger, paperwork, and access to money.^[66]

The Guardian summarized a Verstka investigation that identified 101 Russian servicemen accused of murdering, torturing, or fatally punishing their own comrades, with at least 150 deaths verified by the outlet.^[67] Verstka also linked some killings to financial extortion schemes in which commanders demanded payments to avoid suicide missions.^[68]

Those allegations place brutality inside the same system as the corruption it serves, because violence gives corrupt command its enforcement mechanism.^[69] Where a commander can send a soldier into a lethal assault, shape a missing-person report, or punish refusal with violence, he controls discipline, fear, paperwork, compensation, and the price of survival.^[70]

VIII. The Missing Man

The missing category warrants particular attention because it shows how battlefield uncertainty can harden into bureaucratic advantage. Mediazona found that Russian courts received 20,000 claims in 2024 to declare people missing or dead, two and a half times the prior year’s figure.^[71] Many of those claims, it found, were filed by military commanders seeking to remove soldiers from personnel lists when death had not been officially confirmed.^[72]

For families, that classification can transform grief into an administrative proceeding, leaving relatives without reliable information, without compensation, and without a clear route through state paperwork.^[73] Combat produces some of this uncertainty by itself, because bodies remain unrecovered, records fail under battlefield conditions, and identification can take time.^[74]

The significance of Mediazona’s finding lies in the moment when that uncertainty becomes useful to the institution. At this scale, with commanders themselves moving cases through court, the missing category begins to serve the needs of the unit as much as the needs of the family.^[75] A soldier can disappear first on the front and then inside the record meant to account for him.^[76] The unit obtains room for replacement manpower, the family receives delay in the form of process, and the commander gains distance from the death his paperwork may help define.^[77]

IX. Why Waste Can Persist

The standard explanation for Russian waste begins with incompetence, and that explanation has real force because failed assaults, inaccurate maps, weak logistics, poor training, defective drones, and inflated reports all describe a military system that often fails on its own stated terms.^[78] Yet incompetence alone remains incomplete as institutional analysis, since it identifies visible malfunction while leaving unresolved the harder question of why those practices have survived repeated battlefield exposure.^[79]

The more durable explanation lies in incentive, understood as the set of private rewards, bureaucratic protections, and political signals that allow visible failure to become manageable inside the chain of command.^[80] Reported progress protects commanders who keep men moving into assaults, the threat of deployment gives corrupt officers a market in fear, and inferior procurement rewards officials and suppliers whose profits depend on weak scrutiny.^[81] At the top of the system, wartime budget flows give elite factions streams of money worth defending, and the Kremlin’s demand for a moving map creates a market for optimistic reports until failure becomes too visible to absorb.^[82]

Territorial demands produce reported gains, and those reports justify further assaults that require more men, drones, fuel, equipment, bonuses, benefits, and replacements, creating additional points where money, authority, and paperwork can be captured.^[83] As extraction weakens battlefield performance, the system develops a greater need for exaggerated claims of progress, which then support the next round of assaults and the next set of opportunities for rent seeking.^[84] A military organized around effectiveness would try to escape that loop, whereas a corrupt military can adapt to it because the cycle supplies operational excuses along with private rewards.^[85]

X. The War Machine as Cash Register

Russia’s war continues for reasons that exceed graft, because Putin’s imperial imagination, fear of defeat, territorial ambition, regime legitimacy, and hostility to Ukrainian sovereignty all remain central to the decision to keep fighting.^[86] Corruption alone did not cause the invasion, and it will not determine the war’s end by itself, although it helps explain why a destructive war can remain useful to many who administer the system.^[87]

The war remains a political project for Putin, yet for senior officials, contractors, recruiters, and front-line commanders it can also become a budgetary empire, a procurement market, a quota system, and a private economy of fear.^[88] Soldiers enter that economy as men bargaining under pressure, poverty, coercion, or desperation, and families are forced into disputes over whether the state records a son as dead, missing, useful, or forgotten.^[89]

The system’s stability lies in this perverse distribution of loss and reward, under which commanders can profit while men are spent, suppliers can benefit while equipment disappears, and the Kremlin can receive the reported progress it demands while credibility decays.^[90] The war can weaken Russia as a state while still compensating the particular offices, networks, and factions that have learned how to draw income, authority, or protection from its continuation.^[91]

Strategic irrationality therefore does not preclude institutional durability, because a war that depletes the country can still reward those positioned to administer the depletion.^[92] It can continue as long as the map must show movement, the money must circulate, and enough actors can profit from the space between territorial fiction and wartime expenditure.^[93] The marketplace inside the war has become Russia’s other front because it links battlefield attrition to institutional reward.^[94]