Analysis: Obama Not Alone in Having Doubts About Russia Sanctions

PHOTO: Russian President Vladimir Putin speaks during a meeting of State Council in the Grand Kremlin Palace in Moscow, Russia, April 21, 2014.
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If President Obama seems skeptical of his own plan to stop Russia’s meddling in Ukraine with just sanctions, he may have good reason. He is in uncharted waters, trying to pressure such a large country into backing down without the threat of force.

“We don’t yet know if it’s going to work,” Obama told reporters ahead of today’s sanctions announcement.

Obama took the use of force off the table early on in the Ukraine conflict. Instead, he is relying solely on economic sanctions and his efforts to isolate Russia’s President Vladimir Putin. Yet this will not be easy, largely due to Russia’s economic size and its close economic ties with Europe.

There are few examples in the modern era of sanctions without the threat of force being used to deter aggression, and none on this scale, according to Gary Hufbauer and Jeffrey Schott, experts at the Institute for International Economics who together have studied the use of sanctions throughout history. There are even fewer instances in which it has worked, they say.

“There is no direct precedent,” Hufbauer said in a phone interview. “I cannot remember one [case] where that’s been successful.”

"There has to be a substantial loss of wealth in Russia for this reasoning to work,” he said.

“Russia much more engaged financially with the world compared with sanctioned countries in the past,” Hufbauer said.

Schott, however, cautioned about comparing apples to oranges.

“You have to be very careful in using historical precedents,” Schott he said in a separate interview. “The overall economic and political context can change quite dramatically from case to case.”

Still, there is little in history to guide the Obama administration.

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In most recent prominent uses of sanctions, notably Iran and North Korea over their nuclear programs and Iraq in the 1990s, the use of force, whether a credible threat or not, has always stood behind the sanctions as the next step should the sanctions fail.

In the case of Russia, the White House is so far sanctioning individuals and entities in Putin’s inner circle, hoping to squeeze him to halting what the West says is a coordinated campaign to destabilize Ukraine. The White House has held off on what it calls sectoral sanctions, which could hit Russia’s critical energy, mining, and banking sectors.

The reason the White House may not have yet imposed those tougher measures illustrates exactly what makes this so difficult.

Despite Obama dismissing Russia as a “regional power,” it nevertheless occupies a strategic position. Its $2.5 trillion economy is the seventh largest in the world. Its gas exports are critical for American allies in Europe (a major reason they have been reluctant to go along with tougher American proposals). American companies like ExxonMobil and Boeing have massive investments in Russia that could suffer under broad sanctions.

Russian cooperation has also been critical in negotiations with Iran and North Korea. Privately, some U.S. officials have worried that antagonizing Russia further could jeopardize that collaboration.

Others experts, however, point out that globalization is a double-edged sword and is exactly why sanctions could work.

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