I see opinion pieces about how severe sanctions against Russia constitute the first economic war in history. It is not. It could be another “world war” starting with the imposition of economic sanctions. It’s just too early to tell. Sanctions didn’t stand a chance to bite. History teaches us that they don’t always get a chance to do that.
We must remember that Japan was dragged into World War II when it was denied oil by the United States. Japan had imported more than 80% of its oil from the US. The US then imposed an oil embargo on Japan while that country was at war with China. Japan lost access to oil. That got the clock ticking and we know how that ended.
Now it’s about banning Russia’s oil sales to the world. And the idea is to exclude Russia not only from raw materials, but also from access to everything, including financial services.
The Mirage of Victory
Does anyone really think that a personality like Vladimir Putin would put up with it and crawl into a corner and hide while his economy shriveled around him? That will not happen. And if not that, then what? We, the West, need to stop wallowing in anticipation of our eventual “win” because “we” will never see it. Sanctions are not a strategy for success – we have already done that and failed.
We are warned by military strategists that Putin will not accept defeat; that Putin must gain “something” from this war; that he cannot simply go home defeated. That would lead to the end of his reign. And we know that’s not acceptable to him.
We have been warned by military experts that if the war does not go well, Putin will use chemical weapons and may even conjure up a pretext for using tactical nuclear weapons.
Putin is a dangerous man. But the Biden administration, which has misread Putin’s response with sanctions in the past, may be misreading him again. Just ask former Secretary of Defense Robert Gates who called that Biden “has been wrong on almost every major issue of foreign policy and national security for the past four decades.”
Risks of a confrontation
And one problem with imposing sanctions is that there is no combat front. There is no way of knowing when her bite will draw blood. Therefore, it is impossible to know how the risks of a confrontation with Russia will increase if sanctions remain in place.
But just as Biden and Secretary of State Antony Blinken wrongly told us that the threat of sanctions would keep Putin away from Ukraine, we are now being told that unless we engage militarily or send too many weapons that are too modern, or too destructive, we will not be in his sights. Not only does this appear increasingly naïve at first glance, but any look at history suggests that sanctions, especially of this magnitude, are tantamount to bombing a country’s factories and shutting them down. In a way, they are the equivalent of economic activity that destroys neutron bombs but leaves the capital stock in place. We shall soon see how Putin reacts to this.
The US has an obligation to Ukraine under the Budapest Memorandum, in which the US pledged to help Ukraine secure its borders if it gives up its nuclear weapons. In fact, the US has not done so.
Worse still, Russia, a co-signer of the Budapest Memorandum, was the violator. Russia invades allegations that Ukraine is Russia and that ethnic Russians living in Ukraine have been targeted; that there is genocide against them; also argue that Ukraine is not a real country.
All of this culminated in a pamphlet (discussed here), which has been translated and gives an insight into why Ukrainian leaders are called “Nazis”. See the same point in this NPR message. This stems from a uniquely Russian use of the term “Nazi” to refer to ethical Ukrainians who think that Ukraine is a separate country from Russia. For real! No wonder Westerners listening to Putin and his rhetoric are confused.
Once Russia ramps up its propaganda machine, there’s no stopping it. And it’s clever at finding a small fact on which to hang a big lie, or adopting terminology that makes its actions sound virtuous when they’re anything but virtuous.
What lies ahead?
I hope this episode of Russia’s lies puts Americans back on the right track. Lies and exaggerations only seem to score politically. In the long run they destroy credibility and send people to one side or the other of the fence to defend the lies of the side they like. But lies are lies and the damage is done. It is very important to assess the facts as best we can and not to present distortions as if they were the truth. Lies and distortions undermine credibility, and credibility is the only ground on which any nation stands. Russia lies – even its supporters know it.
But Americans must also tell themselves the truth. Sanctions did not stop the invasion of Ukraine as Biden promised. Putin counted on gentle sanctions. But they are not soft. Still, they won’t stop his advance overnight, and it’s important to stop the carnage and killing now. The West should “do everything it can”. In the meantime, it had better not sit back and rely on bad analytics to protect it. The sanctions will ultimately be a punishment for Russia. I’d be surprised if Putin didn’t strike when or before that happens.
Putin has already said that sanctions are “akin to a declaration of war,” but he continued to say “But thank God it didn’t come to that.” Nevertheless, it can be. Putin has a way of saying something, planting a seed that will be ignored, and then coming back to it — be careful.
With that in mind, I think the “hot war” should be waged more aggressively, because if the West withdraws the hot war confrontation, if Putin eventually threatens nuclear or more aggressive responses to sanctions, what would the West do? The West must be strong from the start and not rely on sanctions that have failed us before and will likely fail us again.
Robert Brusca is Chief Economist at FAO Economics.
https://www.marketwatch.com/story/the-u-s-must-take-a-strong-stance-against-russia-harsh-sanctions-will-only-raise-risks-to-the-world-11649865563?rss=1&siteid=rss Opinion: The US must take a strong stance on Russia – tough sanctions will only increase risks for the world