I don't know a lot about sanctions, but I've learned two things over the past couple of decades:
- In general, unilateral sanctions don't work. They only work if they're backed by lots of countries.
- They take a while to work. Sanctions are sort of like a grinding medieval siege, something that's effective only if you have the willpower to keep them going for a long time.
President Biden has done a good job of rallying broad support for sanctions against Russia, but they're unlikely to have an immediate effect. It's entirely possible that they'll never have an effect and Russia simply learns to live with some of them while evading others.
On a more detailed level, it's worth keeping in mind that:
- Economic sanctions inherently have a limited effect when they include a gigantic energy-related loophole.
- Targeting oligarchs is fine, but they've long since ceased to have much impact on Russian policy. Putin made it clear years ago that his alliance with the oligarchs had been temporary, and he now expected them to be happy with their money and to follow his lead unquestioningly in policy matters.
- As Israel has taught us all, facts on the ground are critical. If and when Russia fully takes over Ukraine, they aren't going to leave. This is more like Chechnya than Afghanistan.
In a nutshell, the sanctions regime against Russia is genuinely tough. I can't think of an equivalent in recent history. But it's still not likely to change Russia's behavior unless someone gets a burr up his ass and manages to lead some kind of palace coup against Putin. That would hardly be unprecedented in Russian history, but it's still pretty unlikely.
"Beyond that, I'm no Ukraine expert and won't be writing about it more generally."
--KD, 2/24/22
Should have left it there.
Adios, amigos.
I see this post by Kevin differently than you do. I see it as a commentary, not on Ukraine, but on Russia and how we can (or cannot) influence them.
Two points, both relating to bullet items:
Bullet #2--They work a lot better and a lot quicker if they're imposed fully and immediately. So far, the Western policy has been to ratchet up the sanctions incrementally. Hopeless! Should have TOTALLY frozen all their assets right away. Should have cut off all travel and all access to all airspaces IMMEDIATELY. Should have cut off ALL trade IMMEDIATELY.
Those sanctions would have caused considerable economic pain in the West. But economic pain is probably easier to bear than bombs and missiles and artillery raining down on civilians who were never doing anything but minding their own business and going about their daily lives.
Bullet #5--Substitute "Trump" for "Putin" and it reads the same, doesn't it?
They have a far better chance of working than you think.
If the Russians can't spend their money then their dollars are worthless.
If we can hold the world together and keep China from too much trading then the Russian economy will be in big trouble.
An ETF, symbol RSX, which invests in Russia, is down over 65% since the close of business on February 16. Including being down 17% today. Imagine if the Dow went down 23,000 points to 13,000 in less than two weeks.
Agreed that sanctions probably aren't going to be effective as a means of getting Putin to reverse course and end the attack on Ukraine. It appears he's basically decided that if Russia has to become a huge international pariah state like Iran or North Korea to annex Ukraine, then that's what it's going to take. The only thing that might change his calculus is if the occupation turns into a huge quagmire for the Russian military with 1000's of casualties, mass desertions, etc. The way to make that happen is to secretly arm and train the Ukrainian resistance. I'm sure the CIA is already on the ground there working with the Ukrainian military in a variety of ways. Hopefully part of that work is setting up the infrastructure for supplying the resistance movement against the Russian occupation.
Mr Drum
I always trust your facts on the situation in USA and I appreciate reading your opinions on them even if I not always agree with you.
… but you are not that well informed on the situation in.Europe
To be frank , this is a lousy analysis of the present situation in Ukraine and Europe
Have a nice day
Machiavelli has some line to the effect 'a Prince can only conquer a people not his own if he goes there to live'. The US wasn't going to go live in Afghanistan but Putin genuinely intends to go live in Ukraine.
That quote is one of the dumber things I’ve heard.
He means that for the people to accept him as the ruler they must already have a natural connection to him or he has to move in and basically obliterate the place until he's transformed it into an extension of himself.
That would be News to the Romans, Persians, Ottomans to name but a few.
"This is more like Chechnya than Afghanistan."
Yeah, but that's the rub of it, isn't it? The population of Ukraine is 30x the population of Chechnya, and it took Russia the better part of a decade to pacify Chechnya. The question is, then, is Russia at least 30x more powerful now than it was with its little Chechnyan adventure? It sure doesn't look like it.
The sanctions regime simply HAS to work or it will basically be a green light to any country in the world that invading your neighbors to take territory is A-OK.
One thing I think KD's analysis misses is that modern Russia is North Korea or Iran or Iraq or 1960s Cuba. It's not a moribund nation wrapped up in some all-encompassing ideology. The Russian people generally want to be modern, prosperous people fully participating in the world economy and world culture. If their economy suffers, if they can't travel outside of Russia, can't get the latest products, can't watch the latest movies, if they can't find jobs they like, that will really hurt them and they might just end up doing something about it.
"modern Russia is NOT . . ." Oh for an edit feature.
I understood what you meant. I think (judging by the protests) that we can all gather that the Russia people are not a monolith
The question remains whether this segment of Russian society has the capability to make a regime change let alone a course correction. I’ve always held the view that Putin has been around too long, with too much debt accrued from powerful Russians, to make a change while he lives. Perhaps the chaos with his exit from power might open up the landscape of possibilities. Obviously this is an extraordinary failure on his part so far so this is the ultimate test of my viewpoint, but I still remain fairly certain that he will not be unseated
It definitely increases the likelihood that someone from Putin’s tribe will have a harder time seizing the mantle when he dies though
So, we have:
which you assert is:
So what then? He’s a vigorous and clear sighted kabuki master?
Or, an approach (or person) can be vigorous and clear sighted without necessarily being successful. They are not the same thing. Same as how somebody can be lazy and foolhardy but nonetheless stumble their way into success.
If it isn’t going to be successful, and we should expect Biden and his advisors and the Europeans should be able to see that if Kevin can, why even start down the path?
Expressing moral outrage over a specific event isn't a matter of success or failure.
Somehow I suspect our expression of moral outrage is cold comfort to the Ukrainians sheltering in basements and subway stations.
Offs. There are lots of reasons to undertake the actions Biden is leading to isolate Russia even if the odds are that Russia could still prevail in Ukraine: it makes it more likely that Russia _stops_ with Ukraine, it makes it less likely that other autocrats decide to conquer their neighbors, it rallies the free world and makes us less dependent on the autocratic world, etc. Plus, "not likely to change Russia's behavior," isn't the same as "zero chance of success"--this might work to reduce the destruction and suffering Russia would otherwise inflict.
Here's an example by way of analogy:
***********
Doctor: The cancer looks grim, but we can try surgery followed by a regimen of XYZ drugs. I'm not going to lie: the odds are against us, but if we move quickly on treatment and stick to the plan, that's the best possibility for treatment.
Patient: Thanks, Doc. I appreciate you steering a vigorous and clear sighted course on this one.
Rick_jones: If it isn't going to be successful, why even start down the path?
***********
You see how silly you're being, right? Now, if you want to argue that the sanctions against Russia hurt us more than they are worth, fine, go right ahead. But don't pretend that because Kevin is skeptical that an approach will be 100% successful that Kevin is then being irrational for supporting that approach.
Given at the moment I know someone for whom repeated treatments for pancreatic cancer are ineffective and basically making her life unbearable, I would suggest finding a different analogy.
what other path is there, reasonably speaking?
It may indeed be Kobyashi Maru. I don’t think the ratchet in sanctions was going to be effective. Putin does not come across as someone caring about subtlety.
What I have the greatest difficulty with though is the cognitive dissonance required to hold both of Kevin’s assertions as true.
Surprise nuclear attack. I bet we could take out at least 60% of their tactical nukes. Which means US cities would only be hit by 300 and not 700 warheads. Trump would be on board, I'm sure, but not ineffectual Sleepy Joe.
https://www.youtube.com/watch?v=s3Ctz8W04uk
If the Ukrainians are going to end up like Afghanistan or Chechnya, then I wouldn’t blame them if they sabotaged the pipelines. Might as well. So sad.
you can't view sanctions in isolation. there is a war going on and that has consequences in and of itself on the russian people and the russian economy. plus, russia's geopolitical position is deteriorating. finland and i believe sweden are considering the possibility of joining nato. and there is still the possibility of sanctions on oil and gas. none of this in and of itself will end the war in ukraine, but the combined weight of everything, in time, just might. this is chechnya but with the world's spotlight on it.
btw i saw a piece this morning that mentioned russian tanks and trucks running out of fuel. all the oil and gas in the world won't do them any good if they can't get it to the front.
Except that, this is pretty much the same scenario that is claimed to have led to the breakup of the soviet union. The economy was a shambles and it became evident to the plutocrats that the economy needed to be reorganized to make being a plutocrat worthwhile.
Putin exists in a sphere of political influence, and eventually the rich will find a way to exert their power to maintain and enhance their wealth.
But that Russian oil loophole does seem pretty big.
It weren't in shambles by 1989. It never was really in shambles. The 74-84 period was rough......welcome to capitalism.
Putin is the guy who paid cash dollars for every American Soldier killed in Afghanistan, etc. You want sanctions? How about offering one billion dollars for the head of Vladimir Putin? Their choice of currency or comodity.
Nukes
It did surprise me that even two of the oligarchs have already rebuked Putin's decision to invade. That seems bold, given the usual things that "happen" to his outspoken opponents.
They obviously think there’s a better chance that Putin is the next guy to fall out of a window, not themselves.
Never thought I'd be in favor of defenestration of another human after reading that Martin Luther recommended it, but maybe it's time has come. Wonder about any ensuing chaos & his successor.
Oligarchs are rich. The west can make them poor. Oligarchs fear being poor. But, as you say, Putin can make even oligarchs dead. So they temporize.
If Russia operates like traditional organized crime, my assumption is that the oligarchs are hedging their bets by making friends in the security services and military and helping those friends to live better lives. Putin seems more isolated and he’s publicly humiliated several high ranking members of the intelligence community/secret police which is something you have to wonder about. Particularly since two of the men he humiliated almost certainly have the details of his personal security and have access to his bodyguards.
One minute you’re relaxing in the barber chair luxuriating in a hot towel and the next minute your bodyguard wanders off and your being machine gunned by the Gallo brothers. If the oligarchs think the west is going to take their stuff away maybe some of Putin’s bodyguards will become very, very rich.
Hope that your assessment is on the nose; I don't often hope for anyone to risk an assassination, yet all of the more knowledgeable people do seem to comment that he appears uncharacteristically reckless, & remembering those Soviet tanks in Hungary & how long they remained makes me hope for something better now. I wasn't aware of his having possibly antagonized the very people he most needs!
Yes, he did it in two of those televised Bond villain videos. Both one was described in western media as (using the only description I know since I’ve not kept up) either the head of the KGB or the head of the first main directorate for foreign intelligence and the other was apparently senior in this newish secret police organization.
Apparently he’s been extremely isolated for the past two years and you have to wonder if he’s starting to become out of touch and vulnerable. And the appearance of vulnerability and of being less well protected by a small group of bodyguards rather than large cadres of guards working in layers with each watching the others might (if they fear the west is going to take their stuff and keep it) begin to shift the oligarchs calculus of risks.
Particularly if some of them have already a lot of the groundwork of learning who among the bodyguards and personal staff wants to be rich or needs to be killed on the day of and so on and so forth. Also, the oligarchs seem to have a lot of retired Russian special forces on the payroll so if the insiders can create the opportunity, they’ve got the resources.
Maybe the western intelligence community has a clue but based on public information, I certainly don’t.
NPR was running a story with a picture of Putin meeting with his economic advisors. He was at one end of an enormous table. They were at the other. Probably spun as COVID precaution but it made me think he was worried about someone leaving a briefcase under the table near him.
Yes, there have been other remarks about that - it would appear that he doesn't quite trust all those near him. Wonder who is his food-taster - maybe he feeds everything to some poor animal first
Anybody ever examined all the photos to see if his dog is the same one every time?
Oligarchs are rich. The west can make them poor.
In some cases. But as a general rule I doubt it. If Yuri Andreiskygovich, net worth 9 billion USD, has squirreled away 40% of that to Western banks, London townhouses and Miami beachfront condos, he's still left with nearly 5 billion even if every penny of the latter is taken away. Which would suck for him, but, considering the fact that openly opposing Putin means risking his own life (and maybe that of his children), I think Yuri's going to keep his mouth shut and hope that, in the fullness of time, things go back to normal. Plus, China and (especially) Vietnam have some very attractive beaches!*
*I spent Lunar New Year, just as the pandemic was arriving in 2020, in a seaside resort town called Mui Ne. Truly beautiful place. But it was like a Russian Waikiki.
My guess is that the only real money is essentially stuff like shares and property that can be moved. His problem is that he will be living in Russia and with 40-60% less assets he has that much less power. That might signal vulnerability to another oligarch or organized crime family.
The point is to continually ratchet up the pressure on the oligarchs and make them think that maybe it’s worth making a move against Putin if it looks like you and your loved ones are about to be gobbled up by another oligarch or an ambitious hungry gangster.
My guess is also that all of the oligarchs (even the ones who were once close to Putin would breathe an immense sigh of relief if he were gone. And, obviously outside lookin in, the guy is starting to look kind of vulnerable. I’m sure many oligarchs have been gingerly feeling out Putin’s defenses for years. If it’s true that he’s only really connected to his small number of bodyguards, that makes everyone outside the magic circle potentially interested in becoming a millionaire and his isolation might make Putin a little bit duller and just complacent enough to be killed.
Yes, it’s not like the oligarchs have giant stacks of rubles or dollars or Swiss francs; their wealth is investments of all kinds. The ones outside Russia are largely now out of reach, the ones inside Russia are cratering.
Kevin doesn't understand capital markets. Maybe Putin will return fully to socialised capital markets, dump the Oligarchs and will the people into unity, but the change will require a work ethnic the Russians don't have.
I find that there is a one-dimensional, binary view of sanctions that is common, and even visible in this thread.
It kind of goes that the sanctions either "work" or "don't work" and that metric is applied as one of military goals.
But military goals are only a sub-catagory of political ones. The sanctions make disapproval visible and credible. The fact that so many countries are willing to do things that clearly have a price tag gives so much more weight to their disapproval than simply a "stern statement" would. This may not have an impact on Putin. It might well not deter him. But it might well deter other copycats. It might well have an impact on Russian soldiers and Russian citizens, or Byelorussian ones.
This is very much worth doing.
Another added dimension is situational. For one, if your goal is to effect internal change, how does the populace view sanctions? In this case the argument that the Russians will see the logic in sanctions is more realistic: from what I have read (and taken with a grain of salt, to be fair) is that many Russians see him as going off his rocker. Better results to be expected when sanctions are clearly justified like this
No one was going to send troops to Ukraine so what was left was sanctions and sending weapons. Both were done with unprecedented speed and in unprecedented amounts. It may not suffice to help Ukraine repel the invasion in the short term but in the medium one it will (1) demoralize Russians including their elites, (2) encourage Ukrainians to keep up the fight, and (3) shore up the Western alliance. All bad for Putin and ultimately good for Ukraine which, having become a symbol of Free Europe, can no longer be kept out of it.
I think Kevin’s underestimating Russia’s unique vulnerability to real, powerful sanctions. The Russian economy is teetering on the edge of collapse. As Macron said last night, it wouldn’t take much to push it over the edge.
One important point is that the rise of the ruble as a storehouse of value is comparatively recent. For decades, Russia had essentially a dollar based economy and to a large extent it stills does. Nearly every ATM has a dollar option. This wasn’t a problem as long as Russian banks had access to nearby limitless supplies of dollars. But now, the cargo planes loaded with pallets of freshly minted dollars have stopped flying, dollars are in short supply and being hoarded.
Another important point is that Putin really never told the Russian people that they were about undertake the conquest of Ukraine. It’s apparently hardly being mentioned in Russian media. Unlike other victims of western sanctions, Russians are being hit with severe ostracism and crippling sanctions without believing that they are suffering for a good cause. The longer the war drags on, the more the pressure on the Russian state will mount.
Finally, I think Kevin fundamentally misunderstands the issue of sanctions on the oligarchs. We know that Putin’s deeply isolated and has little contact with his fellow oligarchs. But the point of placing sanctions on them is that doing so places their families and fortunes at risk for the reasons I’ve previously described.
The oligarchs (essentially organized crime figures) are probably in the best position to kill Putin. They have limitless money and one must assume that as Putin’s contacts with the outside world have shrunk, the bonds of personal loyalty or fear that have bound the military and secret police/intelligence agencies to him have loosened. Properly motivated, I believe the oligarchs and other components of organized crime have the access and resources to win over sufficient people who are well positioned to undertake such an activity (perhaps even some of Putin’s bodyguards who would like to be rich).
That’s the point of sanctions on the oligarchs. It will motivate them to take risks if their stuff is seized. It will motivate them a lot if there’s the possibility that their stuff will be kept by foreign governments. If the Ukrainians can hold out and it looks like the next step is deporting families and holding onto the loot, things could happen pretty quickly.
Some hayseed Nazi cheering on the Russians inside Ukraine,
https://twitter.com/borzou/status/1498393087952961541
This is what happens when incels get old before they go out in a blaze of glory.
Nazi?? Try harder
I meant you, of course.
Keep trying.
Putin hides from his people, Zelensky lives among his.
________________
One way to puncture the "strong man" mythos...
Anti-vax groups, just by chance, all of a sudden have a huge boner for Putin and destroying Ukraine,
https://www.theguardian.com/australia-news/2022/mar/02/australias-anti-vaccine-groups-switch-focus-to-putin-praise-and-ukraine-conspiracies
Lol, what did you think??? It's all a con. Nope, they aren't antivax at all. Torture them. Rip their eyeballs out. Poor acid down their limbs. Wimps like them will talk in lies. But in lies, come truths.
Sanctions didn't work in Cuba...
different situation entirely.
Not sure I get the import of this point as it applies (or not) to the current situation regarding Russia and Ukraine:
"As Israel has taught us all, facts on the ground are critical. If and when Russia fully takes over Ukraine, they aren't going to leave. "
So, Israel has maintained its occupation(s) of neighboring territories in the face of united international sanctions led and orchestrated (chiefly) by the USA (their biggest ally) ... ?
The company building Nordstream 2 has declared bankruptcy and fired all it's staff,
https://www.telegraph.co.uk/business/2022/03/01/ftse-100-stock-markets-live-news-rouble-russia-gas/
I still think it would make for a dramatic statement to blow the sucker up, just to close the book.
Sell it to Amazon as a pneumatic tube for two day delivery.
Hyperloop!!!
Didn't James Bond escape from Russia through something like that once?
Eddie Fishman
@edwardfishman
·
Feb 28
(3) Now that the details are out, it looks like these are essentially blocking sanctions. (There are technical differences, but the effect is the same—"any transaction" with the CBR is prohibited.) The CBR will be unable to intervene in FX markets to prop up the ruble, full stop. The US directive also applies to Russia's National Wealth Fund and Ministry of Finance. Consequently, the action renders ALL of the Russian government's rainy day funds inert. It is comprehensive. (SOEs aren't included, but their FX holdings aren't nearly as large.)
The oligarchs may have lost influence over policy, but some of them have their own small armies of ex-military, ex-GRU, ex-FSB … the rough equivalent of mafia ‘families’, as Mitch Guthman puts it.
And as I said before, they didn’t get to be billionaire oligarchs by being goody-two-shoes.
That's true, but many of them owe a nontrivial part of their fortunes to Putin's favor.
And now they can thank him for their massive losses.
An 80% loss of a $10 billion fortune still leaves one pretty rich. But turning on Putin might mean losing everything. Including one's life.*
I'd love to think hitting the oligarchs hard is the difference-maker. And we have to try—agreed! Because anything that might work has to be tried.
That said, I believe popular discontent (urban unrest, huge demonstrations, etc) is what spells the end for Putin—not disgruntled rich guys who have to temporarily give up Riviera vacations and London shopping sprees.
*Also—and I fear this may be critical—most of the oligarchs have committed crimes and/or engaged in corrupt, ethically-questionable behavior to amass their riches. So it's not clear that the typical calculus of a Russian oligarch is: "I'd be better of if Putin is gone." Many of them likely have reason to fear a post-Putin regime.
First, neither you nor I likely thinks the way an oligarch does, but I still suspect that “oh well, easy come, easy go” ain’t it. To your last point, if a group of oligarchs are able to remove Putin, they are also able to install a successor who is to their liking.
Interestingly, Nikita Khrushchev was removed from power through procedures that were entirely proper - procedures he himself had introduced.
The sanctions truly are unprecedented. That Russia has closed MOEX for a week speaks volumes -- I still can't see how it can open up at all, lest it collapse before our eyes. Up until the west targeted the Russian Central Bank, I think one could reasonably argue that it wouldn't have the intended effect of stopping the war. I think sanctioning the RCB is a tipping point, however.
Quite possibly, the world is sending Russia's economy into a 1929-era tailspin, even as everyone else's markets are doing fine. RCB can't buy up any more Dollars and it can't swap/sell debt to stabilize the Ruble. Russians are trying to withdraw in Dollars, not Rubles. That bank run is creating high distortion of USD:RUB valuations, further accelerating the economy's collapse. The primary instrument left is the bank rate. At 20%, I'm not sure if they're helping tamp down inflation or pushing their economy into the abyss.
While sanctions previously took time for full effect, the targeting of the RCB has sped up the effects of the sanctions and some are now predicting Russia's default on its sovereign debt.
I'd say the odds are much higher than you think, of Russia removing Putin and ending the war.
Yes, time is not on Russia’s side - in fact, the longer the stock exchange is closed, the more drastic the selloff will be, as slower-acting sanctions put increasing pressure on investors.
But it's still not likely to change Russia's behavior unless someone gets a burr up his ass and manages to lead some kind of palace coup against Putin. That would hardly be unprecedented in Russian history, but it's still pretty unlikely.
Agreed. I've seen zero evidence Russian elites are contemplating or are capable of taking action to remove Putin. It's early days yet, of course, so hopefully this changes. Because everything depends on it.
Otherwise I fear we're eventually going to need to start thinking about an off ramp for Putin, as horrible as that is to contemplate (or else this thing could get really ugly and scary).
He can go live in Idi Amin's old house in Saudi Arabia.
Do you expect to see ads: “Wanted: Skilled assassin to take out stumpy ex-KGB man. Ring Moscow +7 123-4567-901“?
It's not going to be the oligarchs who remove him. They can't even get close to him right now. The only people within spitting distance is...
General Shoigu is my bet, but General Gerasimov is right up there. Maybe they join together and do it.
Of course, I wouldn't be surprised if Putin has them arrested and summarily executed, seeing as his paranoia is very high right now.
Yes. I do think the generals offer more hope than the oligarchs in terms of effecting regime change.
KD, read: https://threadreaderapp.com/thread/1499092871265361927