Saturday, February 19, 2022

Senate Republicans Introduce their own Russia Sanctions Package after stalled Bipartisan Negotiations



Recent Senate sessions, concerning the present conflict between Russia and Ukraine, have been taking place in the past weeks as the situation continues to escalate without foreseeable resolution. Currently, it is estimated that there are over 150,000 Russian troops stationed at the border, and just recently after having claimed that they would decrease troop presence the Kremlin in fact advanced an additional 7,000 troops to the already massive stationed total. The situation has drawn international concern and sent various nations and organizations such as NATO into important and time sensitive talks. The U.S. has been involved in monitoring this border crisis and working towards coming up with a solution that prevents violent conflict while also punishing Russia's aggression, yet the challenging politics of the U.S. government have presented obstacles to the decision making process. 

Weeks of negotiations in the Senate between Democrats and Republicans regarding whether or not to impose sanctions on the Nord Stream 2 pipeline (which supplies Germany with gas from Russia) have resulted in a 55-44 vote (60 votes were needed to pass it), resulting in no implementable action. Republican senators however, led by Senator Jim Risch, have proposed a new sanctions package called the Never Yielding Europe's Territory (NYET) Act. Hoping to solicit Democratic Support so that it may be passed quickly, this sanctions package labels out various actions to be taken in the instance of Russian invasion. Firstly, in the event of an invasion the U.S. would immediately place sanctions on the Nord Stream 2 pipeline, along with on Putin's "cronies, enablers, and major banks." Alongside this, $500 million would be provided to finance Ukraine's military, U.S. funding for military excersises in Europe would be doubled, and a new State Department Foreign Military Financing program for Eastern Europe would be created, enabling the U.S. to assist its allies there (protecting them from future territorial aggression/threats such as the current one from Russia). The U.S. is no stranger to conflict in Eastern Europe: since the Russian invasion of the Crimean Peninsula in 2014 which resulted in occupation of the region, the U.S. has contributed over $2.5 billion to aid Ukraine. 

It remains to be seen whether enough cooperation can lead to an agreement on the NYET Act, and if this is a good option to purse, yet I think that it is important for there to be genuine bipartisan consideration of Congressional Proposals. If it is passed, the Office of Foreign Assets Control, a subset of the U.S. Department of the Treasury is the agency that would be involved with regards to enforcing sanctions on Putin and Russia. Time sensitive matters such as military conflicts convey urgency to Congressional hearings and decision processes, and there are fewer options to delay action by means such as filibuster due to the nature of the problems. I believe it to be an unfortunate reality that even when pushed to problem solve in a condensed time frame due to the severity of an issue, that the government still is adhering to partisan politics and policy, an effect of the increasing polarization and general party loyalty amongst elected officials. The best outcome that was achieved thus far by both "sides" in Congress has been a statement of unity supporting Ukraine, a symbolic notion that achieves nothing truly tangible. Hopefully there can be more consensus with respect to a course of action as it seems as though the situation truly does not have much time before something happens either in the form of invasion or retreat. 

Questions:

What are your thoughts on the NYET Act (is this a good/realistic proposal, are certain parts better than others)?

Should more U.S. money be channeled into aiding Eastern European nations, given how much has already been expended on the behalf of maintaining security there?

Is it better to make diplomatic statements, or pursue more direct actions (such as sanctions) when in a stand-off with another nation?

Sources:

http://www2.gtlaw.com/practices/export/pdf/HowBestToRespondOFAC_AdministrativeSubpoena.pdf
https://www.cnbc.com/2022/02/16/nato-says-russia-is-increasing-troop-count-at-ukrainian-border.html






2 comments:

Amanda Hao said...

While action needs to be taken against the expansionist regime of revanchist Russia, sanctions are not the way to go. Sanctions against authoritarian targets rarely put enough pressure to induce concessions. The regimes survive by diverting the economic costs of sanctions to ordinary citizens and using the remaining resources to offer selective rewards to their supporters to isolate them from the economic hardship. When the United States froze Russia’s assets in 2014, they restricted access to international financing during a recession. The sanctions compounded the fall in oil prices, requiring Moscow to cut spending on health care, infrastructure, and government salaries, hurting ordinary Russians.

Even asset freezes don’t work. When almost 200 Russians had their assets frozen after the 2014 invasion of Crimea, none of them really cared, and the sanctions didn’t cause Russia to deescalate either. Instead, the Kremlin’s aggression only grew; Russia formally absorbed Crimea and upped its financial and military support for pro-Russian rebels in eastern Ukraine.

Despite harsher and harsher sanctions, Putin has refused to pull out of Ukraine, and Russian maps still include Crimea in the Russian Federation. The sanctions largely contributed to the 2014 Russian financial crisis, but this only hurt innocent civilians, and Putin’s invasion of Crimea actually boosted his popularity, keeping him in power and fostering anti-Western sentiment in Russia.

Russians perceive sanctions from the West as a misguided and uninformed attempt at intimidation and Western domination. Pravda.ru, one of the largest Russian online newspapers, called Trump’s 2017 sanctions “hysterical.” Mark Medish, former National Security Council advisor, says that sanctions would probably just galvanize Russia and make the Russian civilians more resistant against the West. Opinion polls show that Russians perceive Western pressure and sanctions to be aimed not at Putin and his cronies, but at Russia and its citizens.

Even if we give sanctions some merit, it’s not hard for Russia to survive U.S. sanctions. Russia exports about 7.5 million barrels a day of crude oil, summing to $300 billion a year, and the West would never embargo Russian oil because there is no supply elsewhere that could fully compensate for that loss immediately. If economic sanctions forced Russia onto a path of greater self-reliance and protectionism, its domestic manufacturing and service industries would almost certainly grow much bigger, and oligarchs would probably prosper more as well.

Julien Darve said...

I think I am going to disagree with Amanda. The sanctions that the US has prepared against Russia in the case of an invasion will absolutely destroy the Russian economy. They are "categorically different" than the weak ones imposed after Crimea. According to a NY Times article on the issue, Russian banks will be put on the "game over" list and businesses across the world would stop doing business with them, as well as US banks would not lend to Russians anymore*. Not only will this have disastrous effects on the Russian economy, it will affect top officials in the Russian government, Putin's best buddies, potentially causing resent among Putin's ranks. The Russian Ruble would fall in value; it has already fallen 10% in value among talk of sanctions. These are not sanctions he can just ignore.

I do not see what Putin is thinking if he is going through with this invasion, his entire economy has to be worth more than the public opinion, foreign policy, and resource gain of invading Ukraine. If he is doing this to seem like he is restoring Russia's glory and make the people see him as a hero, I would think they care more about the food in their stomachs than the vague idea of rebuilding of a lost empire.

One problem is that Europe severely cutting off trade with Russia will be bad for climate change action, because they will lose access to Russian natural gas. Gas and electricity bills are already skyrocketing in Europe. As Amitai stated in his post, the Nord Gas Pipeline will be hit by sanctions, and this is the major pipeline providing gas to Europe. Some European are building solar panels, others turn to coal**.

I also think that the half a billion dollars of aid to Ukraine in the NYET Act given after Ukraine is invaded is a bit useless because, if Russia mobilizes its full might, the country will fall in a matter of weeks and there will not be enough time to put the money to use.




*https://www.nytimes.com/2022/01/29/us/politics/russia-sanctions-economy.html
**https://www.nytimes.com/2022/02/21/business/europe-power-gas-bill.html