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US versus Russia: Washington publishes its ‘non sanctions’ list

Alexander Mercouris

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Six months after President Trump very grudgingly signed into law a bipartisan bill voted for overwhelmingly seeking sanctions against US ‘enemies’ such as Russia and Iran, the Trump administration, as it was legally mandated to do, has produced its ‘name and shame’ list of prominent Russians.

The best thing that can be said about the list is that it is bizarre.  The senior Russian government officials named in the list appear to have been indiscriminately chosen because they appear in the Kremlin’s and the Russian government’s directories of prominent officials.  As for the wealthy individuals in the list, it seems that they have simply been transplanted onto the list from Forbes.

Some attempt does seem to have been made to keep certain Russian officials of actual or reputed pro-Western views off the list.  Russia’s Central Bank Chair Elvira Nabiullina is not on the list, and nor is the liberal former Finance Minister Alexey Kudrin.  Unsurprisingly, neither is Anatoly Chubais, the ultra liberal Yeltsin official who masterminded Russia’s disastrous and hugely corrupt privatisation drive in the 1990s.

All I would say about the exclusion of Nabiullina and Kudrin from the list is that irrespective of their views both are currently loyal to Putin, and their exclusion from the list will cause them nothing but trouble in Russia.

As for Chubais, any list genuinely intended to ‘name and shame’ individuals responsible for creating corruption in Russia should certainly include him.  Arguably no other single individual bears a heavier weight of responsibility for the explosion of corruption which took place in Russia than him.

Not all prominent people in Russia who might be broadly described as pro-Western liberals have however managed to avoid inclusion in the list.

German Gref, Russia’s liberal former Economics Minister and close ally of Alexey Kudrin, who is now Chair of Sberbank, is included in the list.  Presumably he is there because Sberbank – Russia’s biggest bank – forms such an essential part of Russia’s financial architecture.

Sberbank by the way is one of the state owned Russian banks which were targeted by the sectoral sanctions imposed on Russia by the US and the EU in July 2014.  Far from being hurt by the sanctions it is now in rude health.

As for the other wealthy Russians in the list, it seems that anyone in Russia who is or is reputed to be a billionaire is automatically included.  These seems to be the case irrespective of whether they are pro-Putin or not.

Putin himself – much to his chagrin – is not on the list.  It is not clear why.

To say that publication of the list has been an anti-climax would be an understatement.  After months of speculation about what new ferocious sanctions the US was about to impose on Russia and on the people named in the list, it is not an exaggeration to say that a mountain has moved and produced a mouse.

Some Democratic Congressmen were unable to hide their anger, and in testimony before the Senate Banking Committee US Treasury Secretary Steven Mnuchin tried to appease them by assuring them that more sanctions against Russia were indeed on the way.  Whether however they will ever come and how severe they will be if they do is however another matter.

Alongside the ‘name and shame’ list but attracting far less publicity was a classified report the US Treasury Department provided to Congress which was described by Bloomberg in this way

An accompanying report on the effect on Russia’s sovereign debt from possible U.S. sanctions was classified, Senator Bob Corker confirmed in a statement on Tuesday. Congress had requested an unclassified version of the report.

The fact that this report was classified shows the sensitivity and legal difficulty of action against the sovereign debt of Russia, one of the world’s leading economic powers.

It is known that some Democratic Congressmen have been lobbying for action against Russia’s sovereign debt.  As I discussed recently, in practical terms that means action to stop US investors buying Russian sovereign bonds.  As I also discussed recently, that would be unlikely to deter other foreign investors, and given the current state of the Russian economy it would have only a limited effect anyway.

The fact that this report is classified suggests that the Treasury Department and the Federal Reserve Board are advising against it.

It is clear that other wilder proposals to seize Russia’s financial reserves in the US or to disconnect Russian banks from the SWIFT interbank payment system have been dropped.

Why after all the threats and bluster has the US come up with so little?

It is possible that at a certain level President Trump’s well known wish for better relations with Russia has had a certain influence.  However the problem for the US is that ultimately Russia is simply not vulnerable to sanctions.  I discussed this recently in an article for RussiaFeed

Summary

What all these proposals have in common is that they highlight is the simple fact that the sectoral sanctions which were imposed by the West on Russia in 2014 have failed.

The sanctions did not break the Russian economy, or cause a popular revolution in Russia, or lead to an oligarchs’ coup against Putin – all things their advocates variously predicted would happen because of them.

Nor have they achieved their stated purpose, which is to force Russia to change its policies towards Ukraine….

The key point is that the Russian economy is many orders of magnitude bigger and more sophisticated than the sort of economies – such as those of Cuba, Iran, Iraq, Libya, North Korea and Venezuela – upon which the US has imposed sanctions previously.  Applying the supposed lessons of the impact of sanctions on those economies in the case of Russia makes no sense, even if those lessons had been learnt correctly, which they have not. Unlike all those economies Russia’s economy is far bigger, already possessing the technology, capital and resources it needs to develop autonomously.

As a self-sufficient continental economy sanctions on Russia almost by definition can have only a limited impact, and one which over time must diminish anyway.

As it happens the most effective sanctions the West could have imposed on Russia, both in terms of their impact on the Russian economy and their limited impact on the economies of the West, were the sectoral sanctions which were imposed in 2014.

Those sanctions did stop for a time the flow of capital from the West into Russia at a time when Russia was facing heavy debt repayments and when the price of its main export products – oil and gas – was collapsing.  The result was to deepen the recession caused by the collapse of oil and gas prices whilst further lowering the value of the rouble in a way which intensified the inflation spike.

With oil prices now rising, most short term Russian foreign debt repaid, and with the rouble floating, none of the sanctions discussed in this article look like they can have anything like the impact on Russia that the sanctions imposed in 2014 did.

The fact that the Russian economy successfully – in fact almost effortlessly – adjusted to those sanctions despite the difficult conditions ought to serve as a warning that further sanctions against Russia will not work, and…..are counter-productive.

As for the idea that slapping sanctions on wealthy Russians will provoke them into launching a coup against President Putin, to anyone genuinely familiar with the situation in Russia the idea is absurd.

What putting the names of such people on a ‘name and shame’ list and threatening them with sanctions is far more likely to do is get them finally to heed President Putin’s call to repatriate their money from abroad.

President Putin has been pushing hard for this ever since the first round of sanctions was imposed on Russia back in 2014.

Wealthy Russians and the Russian business community in general have however proved to deaf to these calls, presumably calculating that they would be exempted from Western sanctions which were intended to target only those people close to the Kremlin.

Now that they know that anyone listed in Forbes is a likely target they may finally reconsider.  That at least is what the Financial Times seems to think

The threat of further sanctions may inadvertently help the Kremlin achieve the long-elusive goal of getting oligarchs to repatriate capital stashed in the west: the finance ministry is preparing to issue a $3bn bond on discounted terms for Russia’s top businessmen. “Everyone is thinking long and hard about it,” says a former member of Mr Putin’s cabinet.

A sanctions policy that actually advances President Putin’s objectives makes little sense.  It is strange that no one in Washington seems to realise it.

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Ukraine’s President Says “High” Threat Of Russian Invasion, Urges NATO Entry In Next 5 Years

Poroshenko is trying desperately to hold on to power, even if it means provoking Russia.

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Via Zerohedge


Perhaps still seeking to justify imposing martial law over broad swathes of his country, and attempting to keep international pressure and media focus on a narrative of “Russian aggression,” Ukrainian President Petro Poroshenko denounced what he called the high “threat of Russian invasion” during a press conference on Sunday, according to Bloomberg.

Though what some analysts expected would be a rapid flair up of tit-for-tat incidents following the late November Kerch Strait seizure of three Ukrainian vessels and their crew by the Russian Navy has gone somewhat quiet, with no further major incident to follow, Poroshenko has continued to signal to the West that Russia could invade at any moment.

“The lion’s share of Russian troops remain” along the Russian border with Ukraine, Poroshenko told journalists at a press conference in the capital, Kiev. “Unfortunately, less than 10 percent were withdrawn,” he said, and added: “As of now, the threat of Russian troops invading remains. We have to be ready for this, we won’t allow a repeat of 2014.”

Poroshenko, who declared martial law on Nov. 26, citing at the time possible imminent “full-scale war with Russia” and Russian tank and troop build-up, on Sunday noted that he will end martial law on Dec. 26 and the temporarily suspended presidential campaign will kick off should there be no Russian invasion. He also previously banned all Russian males ages 16-60 from entering Ukraine as part of implementation of 30 days of martial law over ten provinces, though it’s unclear if this policy will be rescinded.

During his remarks, the Ukrainian president said his country should push to join NATO and the EU within the next five years, per Bloomberg:

While declining to announce whether he will seek a second term in the office, Poroshenko said that Ukraine should achieve peace, overcome the consequences of its economic crisis and to meet criteria to join the EU and the North Atlantic Treaty Organization during next five years.

But concerning both his retaining power and his ongoing “threat exaggeration” — there’s even widespread domestic acknowledgement that the two are clearly linked.

According to The Globe and Mail:

While Mr. Poroshenko’s domestic rivals accuse him of exaggerating the threat in order to boost his own flagging political fortunes — polls suggest Mr. Poroshenko is on track to lose his job in a March election — military experts say there are reasons to take the Ukrainian president’s warning seriously.

As we observed previously, while European officials have urged both sides to exercise restraint, the incident shows just how easily Russia and the West could be drawn into a military conflict over Ukraine.

Certainly Poroshenko’s words appear designed to telegraph just such an outcome, which would keep him in power as a war-time president, hasten more and massive western military support and aid, and quicken his country’s entry into NATO — the latter which is already treating Ukraine as a de facto strategic outpost.

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The Stampede of the Gadarene Swine: US Leaders Allowing Ukraine to Pull Them into Global War

There is no way in any sane assessment that the Ukrainian forces – and certainly not the neo-Nazi militias recruited in the west of the country to terrorize the east – can be regarded as “brothers” of the US armed forces.

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Authored by Martin Sieff via The Strategic Culture Foundation:


George Friedrich Wilhelm Hegel was right – Again: The only thing the human race learns from history is that it learns nothing from history.

In 1914,the British Empire, largest in human history and one of the longest-lasting, charged into World War I to defend “gallant little Belgium” whose King Leopold over the previous 30 years had carried out one of the longest, largest genocides of all time, killing 10 million people in the Congo.

Germany, wealthiest, most prosperous nation in Europe, blundered into the same needless war when feckless Kaiser Wilhelm II causally gave sweeping approval to Austria-Hungary to annihilate the tiny nation of Serbia. Millions of brave and idealistic Russians eagerly volunteered to fight in the war to protect “gallant little Serbia.” Most of them died too. There is no record that any of the Serbian leaders after the war visited any of their mass graves.

Now it is the United States’ turn.

Since the end of the Cold War US policymakers, presidents and their congresses have carried out virtually every stupidity and folly imaginable for any major power. The only one they have so far avoided has been the danger of stumbling into a full scale world war.

However, now, with the escalating and increasingly hysterical US support for the shady and risk-taking junta in Kiev, President Donald Trump risks committing that most dire and unforgivable of all horrors.

Trump today is no more than putty in the hands of his national security adviser John Bolton, one of the masterminds of the catastrophe that was the 2003 invasion of Iraq.

Bolton is just like his hero Winston Churchill a century ago during World War I. He always gets his way, always gets the wars and battles he wants and bungles them embarrassingly every time. And like the young Churchill, Bolton never learns, never mellows and he never changes. It is always everybody else’s fault.

Churchill finally did grow and learn. His famous activities of the 1930s were not meant to start a new world war with Germany under the far worse leadership of Adolf Hitler: He wanted to avert such a war.

The invaluable diaries of Ivan Maisky, the Soviet Union’s ambassador to Britain through the 1930s make clear that even then Churchill was eager – alone in the British ruling classes – to establish a serious close defensive alliance with Josef Stalin and the Soviet Union. He recognized that would be the only way to box in Hitler and prevent a global catastrophe.

But Bolton has not learned from his hero – Quite the reverse. He is now impelling Trump on a reckless course of empowering the dangerous adventurers who with US support have seized Ukraine and have spent the past nearly five years wrecking it.

Even worse, the same kind of absurd sentimentalizing of an obscure, tiny or unstable ally that doomed Britain, Russia and Germany to unimaginable suffering and loss in 1914 now permeates US decision-makers, strategists and their pontificating pundits about Ukraine. On March 1, 2016, US General Philip Breedlove, then NATO Supreme Allied Commander Europe (SACEUR) memorably referred to “our Ukrainian brothers and sisters” in a Pentagon press briefing

There is no way in any sane assessment that the ramshackle Ukrainian forces – and certainly not the neo-Nazi militias recruited in the west of the country to terrorize the east – can be regarded as “brothers” of the US armed forces. The US and Soviet troops who met on the River Elbe on April 25, 1945 after advancing a combined more than 2,000 miles to liberate Europe from the darkest tyranny in its history could truly be called “brothers.”

However, the US military today and the Ukrainian forces they are being drawn in to protect certainly are not “brothers and sisters.” No poll has been taken since then across the United States, as far as I am aware as to whether the American people would be willing to risk full-scale nuclear war to defend a government in Ukraine that is demonstrably unpopular among its own people.

Trump was elected president in November 2016 precisely because he was the only candidate in that shock election who unambiguously called for the United States to end its 70-year fixation with getting pulled into one endless war and confrontation after another around the world. It would be the darkest of ironies if instead he took America into its last and most catastrophic conflict – a nuclear confrontation from which there could be no recovery, no escape and no survival.

Britain, Russia and Germany in 1914 were all destroyed by the deliberate plotting and manipulations of vastly smaller or weaker allies run by psychopathic gamblers. The rulers of Kiev today, in their entirely reckless disregard for the dangers of global thermonuclear war clearly fit into that category.

Policymakers in Moscow recognize this dire reality. Their counterparts in Washington remain amazingly totally blind to it. Their only idea of strategy is the suicidal stampede of the Gadarene Swine in the Gospels off the end of a cliff. And they are taking the entire human race with them.

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France in Turmoil… Blame Russia!

Russia did it!

Strategic Culture Foundation

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Via The Strategic Culture Foundation:


Well, what d’you know, regular as clockwork, Russia is being blamed – again – for “sowing social division” in Western states. This time, it’s the ongoing nationwide public protests in France against economic austerity which some Western media outlets have claimed are being “amplified” by Russian influence.

One of the media outlets carrying such claims is British newspaper, the Times of London. Last month, this same supposedly serious paper published claims that a popular Russian cartoon series, Masha and The Bear, was trying to “subvert” Western children with “pro-Russia” sentiments. After that ridiculous piece of garbage journalism, what credibility has the Times got to now push claims that Russia is behind the social protests engulfing France? Exactly, enough said.

France has been roiled by nearly five weeks of anti-government demonstrations, popularly referred to as the Yellow Vest movement. Protesters are planning to stage rallies in the capital Paris and other major cities this weekend for the fifth consecutive week. Clashes with riot police and burning vehicles in the Champs Élysées and other iconic public venues across France certainly speak to the gravity of the social anger being expressed by millions of French people.

The French public are incensed by mounting economic hardship under the government of President Emmanuel Macron, the former investment banker who wants to gut workers’ rights and social benefits under the euphemism of “reforms”. That’s after he and his wife recently redecorated the gilded Élysée Palace with ornate furnishings, wallpaper and carpets to the tune of €600,000. Many French workers are struggling to even heat their homes, such is prevalence of poverty.

This week, Macron made a nationwide televised address from this same gilded palace in which he appealed for calm and stated that the authorities would belatedly make concessions in an attempt to alleviate anger over tax and other economic issues that the French public say have hit them hard with deprivation.

Nevertheless, many French citizens say that Macron’s concessions are not nearly enough to appease their grievances. They have vowed to continue protesting, despite a terror incident this week in the eastern city of Strasbourg in which a gunman apparently killed three people. French authorities have urged protests to be called off in the aftermath of the tight security situation. The protesters have so far refused to call off their nationwide demonstrations.

It seems significant that as the Macron government is increasing its pressure on protests to subside – no doubt out of alarm that the authorities are losing control over the populace – then this week the media are lately reporting on claims that Russia is “amplifying” the unrest.

Jean-Yves Le Drian, the foreign minister, told French media that his government was launching a probe into allegations of Russian incitement of the Yellow Vest movement. It seems like a cynical distraction to undermine the legitimacy of public fury.

What are the allegations of Russian interference based on? Apparently, the Times of London and other Western media outlets reported that “Russian-linked” social media posts are commenting on the protests. So too, it is claimed, Russian news media have devoted undue coverage to the French demonstrations.

So, let’s get this straight. Russian social media users and Russian news media are to blame for “amplifying” French unrest because they happen to report or discuss such unrest. The logic is absurd. No doubt millions of people in countries around the world as well as their news media are commenting on these momentous events in Europe. Just because Russians are doing that, then this is cited as “evidence” of Russian interference. What underlies that ludicrous conclusion is the most fatuous prejudice of Russophobia.

Western states are living in denial. Deep social problems from poverty under their failed economic policies and from disenfranchisement under failed political governance are inherent causes. Yet in spite of the systemic failure, Russia is cast as the scapegoat, rather than looking inward at the inherent causes.

We saw this in the US after the election of maverick outsider Donald Trump as president and with Britain’s Brexit referendum to leave the European Union. Those events were the result of discontent within those societies with regard to the status quo. Rather than dealing with their inherent social, economic and political problems, certain elements within the ruling class in the US and Britain sought to explain away the failing by pointing the blame on Russia.

The same tawdry thinking is being invoked with regard to the French protests.

Admittedly, however, the tedious narrative of blaming Russia is wearing thin, and so the latest claims about Russia stirring up the French are not being too widely played in Western media, no doubt because of a realization even by the Western media that such claims are idiotic. Again, after the Masha and the Bear farcical “report”, the Russian “red-baiting” in Western media has lost any potency it may once have had.

Western states are indeed confronting huge challenges from their own populaces. Poverty, social injustice, unemployment, crumbling public services, rampant alienation from state institutions, disgust with criminal militarism, among other grievances, are all motivating popular discontent and anger. The French protests are symptomatic of an international revolt against injustice of a failing capitalist order.

Western ruling establishments are only stoking even more popular uprising by refusing to take the societal malaise seriously. They are postponing a day of reckoning which will come sooner or later with greater force. Blaming Russia is part of their futile charade to postpone the day of reckoning. Telling French people they are being manipulated by Kremlin agents is laughable, contemptible and fueling the calamity of political collapse. Out of collapse, it may be hoped that some progressive, democratic new polity might emerge.

In an absurdist twist of the Marie Antoinette fable, French and Western authorities are saying, “The people want bread – but the Russians are telling them they should eat cake”. The travesty of their own elitist irrelevance is what’s making Western societies revolt against their establishments.

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