America Sanctions from the Hip

Should the punishment fit the crime? Should the punishment be designed to change the objectionable behavior of the adversary? Most people would say yes to both, but not the United States. America has been sanctioning from the hip, talking big without backing it up and misunderstanding the mindset of its adversary Putin, a dictator who only bends to power and force. As Russia was building up its forces for over six months to invade Ukraine, the U.S. warned Putin that that the world was watching and would act. But Washington has been afraid to deliver the punch — the needed weapons to the Ukrainians or to impose strict and severe enough sanctions to give Putin pause.

Look at Iran’s crimes compared to Russia’s and then compare the severity of the sanctions that each has been subjected to.? What does it teach us about how the United States sanctions adversaries? How should sanctions on Russia be strengthened now and then how should they be lifted after the war?

Iran’s crimes from the American perspective: taking 52 U.S. hostages for 444 days; interfering with Persian Gulf shipping; supporting Hezbollah (a legitimate political party and military force in Lebanon); allegedly orchestrating the bombing of a Jewish center in Argentina; supporting Iraqi militias who attacked U.S. forces; supplying arms to the Houthis in Yemen who are fighting Saudi Arabia; imprisoning about 20–30 dual citizens on various charges over the years; allegedly assassinating a number of its enemies abroad and secretly enriching uranium.

Russia’s crimes from the American perspective: killing 80,000–100,000 in Chechnya in 1994; using chemical weapons and killing about 20,000 in Syria with forces still in the country; invading Georgia in 2008 and continuing to occupy about 20 percent of the country; cyber-attacks throughout the world; arresting foreign citizens on various charges; in 2014, annexing Crimea, an integral part of Ukraine and supporting rebels in eastern and southern Ukraine, Donetsk and Luhansk Oblasts and launching a separatist movement with death toll of about 2,000 over the years; and invading Ukraine in 2022 with destruction and loss in GDP that is likely to well exceed $1 trillion and a death toll that is likely to be well over 100,000.

Recent casualties from Russian aggression speak for themselves — well over 100,000 even before the invasion of Ukraine and now with the latest Ukraine casualties a number that could well exceed 200,000. Then there are the economic losses caused by Russia. Furthermore, Russia continues to illegally occupy vast areas of other countries. Russia’s crimes dwarf those of Iran. Yet the U.S. and NATO pussyfoot around Russia.

The sanctions on Russia have been pitiful in comparison to those on Iran, something a quick comparison will confirm.

The U.S. has sanctioned Iran more heavily than any other country, including cutting off all its financial institutions from SWIFT, sanctioning its central bank, the office of its Supreme Leader, an integral part of its armed forces the Islamic Revolutionary Guards Corps (IRGC), all exports of oil, gas and oil products, imports of all military equipment, of commercial aircraft and parts, all exports from the United States, imposing secondary sanctions on entities and countries who help Iran evade sanctions and the prohibition of visas to Iranians. Iranians have even suffered shortages of life-saving medicines. Ironically the sanctions on Iran have impeded the development of Iran’s oil and especially natural gas reserves, which could be flowing to Europe today and blunting Russia’s energy stranglehold.

After Russia’s annexation of Crimea, the Obama administration imposed what can politely be called a slap on the wrist that emboldened Putin to invade Ukraine — sanctions on the provision of technology for oil and gas exploration, on the provision of credits to Russian oil companies and state banks and some travel restrictions on influential Russians. Putin annexed a large part of a country and these were the sanctions he got! Then with the pending invasion of Ukraine, nothing was imposed before the invasion although the Biden administration telegraphed that an invasion was coming, but after the invasion and ensuing Russian atrocities, weak sanctions were imposed in dribs and drabs. They have included: sanctions on an increasing number of Russians close to Putin, on fewer than a dozen Russian banks but even then carving out oil and gas to allow these to be exported unimpeded, on investment in Russia, on the export of certain technologies to Russia and most importantly on Russia’s central bank. Still no sanctions on the export of Russian gas and oil that are the lifeblood of the Russian economy, but most recently one on Russian coal that matters little. This was the best the West could do! These weak sanctions have been in part reinforced by some companies moving out of Russia. Some U.S. companies, notably Koch Industries, still operate in the country.

While Iran has been cut off from developing its oil and gas reserves and exporting its products, Russia continues full steam ahead. While Iran cannot import many essential items, the door is open for Russia. While no major Western companies operate in Iran, many still do in Russia. And all this after Russia annexed parts of two sovereign countries, caused well over 100,000 casualties and inflicted hundreds of billions of dollars in losses on peaceful countries.

Why such a disparity of sanctions, especially as Russia has caused so much more harm? The reasons are at least four.

First, Western politicians, most notably those from Germany and the United States, allowed Western Europe to become dependent on Russian gas and oil with financial benefits for the German elite. There were options open for Western Europe that could have been developed — specifically from Iran — but they were squashed because of other political considerations. So today Russia holds a gun to Europe’s head. Second, the United States has been preoccupied with keeping NATO united as members have a variety of exposures to Russian gas and oil. Third, the U.S. and its allies are unwilling to make sacrifices. Some NATO members could reduce their consumption of oil and gas by say 10 percent and share the surplus with those who have a large deficit. Fourth, the U.S. and its NATO allies are simply afraid of Russia and its nukes. America takes timid steps not to alarm Russia. If Iran had committed Russia’s atrocities, it would have been bombed to oblivion, but NATO has not even given offensive weapons to Ukraine while Russia bombs them at will. Consider what this says to non-nuclear countries — to buy security, get your own nukes fast. Just read what the U.S. keeps saying — it is afraid to transfer everything Ukraine needs because Russia may see this as a provocation and an expansion of the war while Russia kills, maims and destroys at will!

It gets worse. American sanctions fail because they don’t incorporate how Putin, a dictator, would respond. He listens to no one and understands force and uses force. If the U.S. and the rest of NATO want to change Putin’s behavior, they have to use strong sanctions and exude power and not be afraid of taking risks to confront Putin head on. Yet, America shows weakness through its dithering and Russia takes advantage to brutally push its plans. In 2014, the Obama did almost nothing after Putin annexed Crimea; Trump weakened NATO and put Putin on a pedestal; America’s weak response put Putin on this course. Today, since the invasion, NATO has transferred about $2 billion in military and humanitarian aid to Ukraine, while Russia has exported over $35 billion in oil and gas! NATO has not supplied all the defensive weapons Ukraine desperately needs. In view of the horrors we see on the ground, it may be time to supply Ukraine with many more defensive weapons and even offensive weapons. After all, Russia has invaded Ukraine, surely Ukraine is justified in taking the war to Russia? There is no excuse not to do this as America has sold offensive arms to other aggressors in the midst of war, including Iraq, Saudi Arabia and the UAE, so why not to Ukraine? If you want Putin to back down, give Ukraine ALL it needs now to push Russia out of Ukraine, including from Crimea.

The U.S. still has the opportunity to make sanctions on Russia effective — essentially cutting all Russian financial institutions from SWIFT and banning Russia’s exports of oil and gas and doing so now before it is too late. Rapid development of Iran’s gas relieved from sanctions — piped to Europe and LNG for shipment — will be critical for European energy independence from Russia.

When this war ends, as it will, the U.S. will have to be strategic on which sanctions it will leave and which it will lift? And what will its conditions for lifting sanctions be — Russia removing all its military from annexed and occupied lands in Ukraine and totally exiting the country, including Crimea and the Donbas, making reparations for the loss of life, physical damage and for forgone GDP, giving guarantees against future aggression and cooperation with war crime trials? The U.S. must not push Ukraine to compromise, ceding territory to Russia will eventually lead to another war. Enabling Putin after Georgia and Crimea has brought us to his new war — don’t repeat your mistake. Wars must not be rewarded as they would breed more wars. Stand firm! The United States should consider Ukraine’s legitimate demands after hostilities end, maybe even telegraph them to Russia before aggression ends, in the hope of deterring further human horrors and physical destruction when Putin sees that the longer he continues the higher will be the price to pay.

Stop the dithering! This is a call to action for the U.S. and NATO! Every wasted day — making excuses for not giving Ukraine all it needs — emboldens Putin, weakens Ukraine’s hand and prolongs the war.

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MIT engineer and economist. Prof: Tufts, UT-Austin, GW. IMF Board. Writing: Econ-Finance, Oil, Sanctions, FP, Middle East, Islam (http://islamicity-index.org)

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Hossein Askari

Hossein Askari

MIT engineer and economist. Prof: Tufts, UT-Austin, GW. IMF Board. Writing: Econ-Finance, Oil, Sanctions, FP, Middle East, Islam (http://islamicity-index.org)

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