Here’s a crazy trick question: what’s the most exp… oh you already got it?
Because it was in the title of this video?
Right, ok, so… then let’s just jump right in.
Now, you might remember Ashgabat from that time you Googled “what is the capital of
Turkmenistan oh god I am so bored please put me out of my misery.”
Otherwise, there’s a good chance you haven’t heard of it.
So, how did it rise through the ranks of the most expensive cities in the entire world?
Well, a lot of that has to do with the way that “cost of living” is calculated in
the first place.
You see, generally, a cost-of-living index pools together the local cost of a number
of different items that one might regularly spend money on—things like rent, utilities,
food, clothing, transportation, Half as Interesting merch, etc.
Since these prices are subject to different levels of fluctuation, cost-of-living indexes
also take into account the stability of the local economy—things like inflation, exchange
rates, and overall consumer confidence.
“But Sam!” you might be saying, rudely interrupting my whole explanation of cost-of-living
indexes, “Don’t people have different needs in different countries?
Like, what about my friend from Canada who doesn’t need to worry about syrup prices
because his government socialized syrup 150 years ago, allowing him to take syrup from
any grocery store for free?”
Well, while that’s definitely not true and the term for that is “shoplifting,” still,
it’s a decent point—cost of living can be difficult to standardize across different
countries, because people have different standards of living and are supported by their governments
to different extents.
So, many of the most popular indexes solve this by looking at cost-of-living for a hypothetical
expatriate moving to a new city; this means standards of living similar to developed countries,
and not taking into account government-subsidized amenities—that last point is particularly
important when it comes to talking about Turkmenistan, but I’ll explain what I mean in a minute.
For now, all you need to know is: expensive jeans + unstable economy = you get to be on
this Wikipedia page.
Got it?
Good.
Now let’s talk about how Ashgabat does that better than anyone else.
While Turkmenistan might be home to the most expensive city in the world, that doesn’t
mean that things are all champagne and… whatever kind of cereal rich people pour their
champagne on.
In fact, it’s kind of the opposite: Turkmenistan is currently facing—to put things lightly—a
devastating economic crisis coupled with a slew of escalating humanitarian disasters.
I guess that’s not putting it very lightly, but there aren’t too many ways to put it.
You see, when Turkmenistan gained independence in 1991, it was well-positioned to become
one of the world’s leading ‘-stans:’ it was sitting on the 4th largest natural
gas reserve in the world—representing about 10% of Earth’s known supply—and a decent
amount of oil, and throughout the early 2000s, gas prices were higher than the Exxon executives
celebrating how high gas prices had gotten.
The problem, though, is that for the first 15 years of Turkmenistan’s independence,
all of that gas money was being managed by this guy: Saparmurat Niyazov.
Niyazov was—to put things lightly—one of the most self-absorbed, unhinged, and despotic
dictators to ever rule in Central Asia.
Man, I’m really not good at putting things lightly.
But basically, Niyazov wanted to rebuild Turkmenistan in his own image: he renamed January after
himself and April after his mother, he banned dogs because he didn’t like the smell, he
banned smoking after he had to quit smoking himself, and he even put his cat in charge
of their airforce.
That last fact was a joke, but the point is that you’d have believed it.
Perhaps his most substantial project, though, was Ashgabat—while most of the country wallowed
in widespread poverty, Niyazov spent huge chunks of Turkmenistan’s revenue on renovating
the country’s capital, bulldozing residential neighborhoods and replacing them with luxury
marble high-rises that no one could afford to live in.
This has left the center of the city virtually empty, serving more so as a statement of national
wealth than as a practical place to live.
But much like a puzzle that’s only had one piece placed, that’s only one piece of the
puzzle.
In 2014, gas prices began to plunge, and major international brands like Levi’s, Nike,
and Amazon fell prey to the SJW mob and decided to stop purchasing Turkmenistan’s slave-harvested
cotton.
With such a hard hit to their economy, Turkmenistan drastically reduced imports—primarily food
products—and the local price of those items naturally started to skyrocket.
To further complicate matters, Turkmenistan’s currency, the Manat, began rapidly declining
in value during the economic crisis, so the government bravely declared that “no it
isn’t” and locked the official exchange rate at 3.50 Manat to the dollar.
While this might seem like it would fix the problem if you’re a four-year-old or a very
corrupt five-year-old, it turns out it just makes the problem worse.
As the practical purchasing power of the Manat began to decline even further—and the price
of products in Manat went up to compensate—the locked exchange rate meant that the inflated
price of those products also inflated their official value.
In Ashgabat, a gallon of milk might cost you about 50 Manat—with a practical, black market
exchange rate of 40 Manat to the dollar, this isn’t too outrageous.
But with the official exchange rate of 3.50 Manat to the dollar—and this is what the
cost-of-living indexes are forced to use—this means a gallon of milk technically costs about
15 dollars.
The same goes for a month of internet service at 186 dollars, or a pair of blue jeans at
112 dollars.
If you plug those numbers into our equation from earlier, I’d say that the math checks
out.
But wait, if Ashgabat is so expensive and Turkmenistan is so poor, how can anyone afford
to live there?
Well, the simple answer is… they can’t.
Since 2003, Turkmenistan has had to foot the bill for its citizens’ electricity, gas,
and water, and set up government-subsidized stores for people to buy food that’s well-under
market price… that is, until 2019, when they stopped paying for utilities and sent
police to break up long lines of starving people outside their state stores.
So, if you want to experience the thrill of spending 15 dollars on milk, you’re probably
better off just going to Whole Foods.
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