WASHINGTON — The U.S. and Europe imposed another round of sanctions on Moscow on Wednesday, more than a month into an invasion of Ukraine that some Western leaders had hoped to head off through earlier rounds of economic measures.
The Russian economy is reeling from the pressure, but few expect the latest round to be any more effective in changing Russian President Vladimir Putin’s behavior than the earlier rounds, renewing longstanding questions about whether sanctions are really as good as they seem.
Washington and Brussels imposed the latest rounds of sanctions after “major war crimes,” as President Joe Biden put it, were revealed in the Ukrainian city of Bucha. The sanctions’ targets are both specific — including Putin’s two adult daughters — and sweeping, barring all new Western investment in Russia and hitting two of the country’s largest banks with full blocking sanctions for the first time.
What are sanctions?
Economic warfare and trade embargoes are nothing new, but modern targeted sanctions have become increasingly popular in the post-Cold War era, where free trade is in and military force is out.
Their popularity is easy to understand, since they offer powerful countries a relatively low-cost, low-risk way of punishing an offending nation without resorting to war.
“Our goal from the outset has been to impose maximum pain on Russia, while to the best of our ability shielding the United States and our partners from undue economic harm,” Treasury Secretary Janet Yellen testified before the House Financial Services Committee on Wednesday.
Sanctions wield one country’s economic power against another, and the U.S. and Europe are uniquely capable of making sanctions hurt.
Not only are they the world’s two biggest economies, but the dollar and the euro are the world’s reserve currencies and the West is home to companies that make the modern world work, from the SWIFT banking network to credit card companies to critical hardware and software makers.
For instance, sanctions could virtually destroy Russia’s entire aviation industry since America’s Boeing and Europe’s Airbus have a duopoly on large passenger jets and have now cut off Russia’s access to parts and services needed to maintain them. Moreover, most of Russia’s airliner fleet is actually leased from Western owners, who are now legally required to seize the planes, if possible.
Russia has tried to retaliate by threatening to cut off food and fertilizer exports to “hostile” countries, but its economy is so much smaller than the West’s, and limiting energy or food exports to Europe would have major repercussions on its own economy.
What’s the goal of sanctions?
Sanctions are economic tools, but generally have political goals, offering a way to punish foreign adversaries for everything from supporting terrorists to developing nuclear weapons, in ways that go beyond diplomatic action but stop short of dropping bombs.
More modest sanctions try to change the political calculus for a targeted regime by raising the cost of an undesirable action. More sweeping sanctions try to undermine the targeted regime by limiting its ability to repress its population and creating more public pressure on the government to change its ways or step aside.
Gen. Mark Miley, the chairman of the Joint Chiefs of Staff, acknowledged this week that sanctions “have a very poor track record of deterring” when asked why they didn’t stop Putin from invading Ukraine, but said they still have value.
“The objective of the sanctions is to impose significant costs if he invaded. Those significant costs, the sanctions in combination with the export controls, are breaking the back of the Russian economy as we speak,” Miley said.
Do sanctions work?
Critics, however, have long argued that sanctions are often ineffective humanitarian disasters that tend to leave the targeted regime with a stronger grip on power.
While there’s no doubt the sanctions have been effective in crippling Russia’s economy, critics say that confuses the means for the end, since it’s not clear a weaker economy will actually hurt Putin.
“Sanctions have hurt Russia. They’ve hurt the Russian people. They’ve hurt the Russian economy. But they have never changed Mr. Putin’s actions,” former NATO Supreme Allied Commander Gen. Philip Breedlove said in a podcast interview this week.
The Congressional Research Service, Congress’ official in-house think tank, found in a report released shortly before Russia invaded Ukraine that it was “difficult to determine” if and how earlier sanctions had affected Russian behavior.
Academic studies have found that sanctions only achieve their stated goals about 30 to 40 percent of the time and that successful cases typically have modest aims, like a change in trade policy or the release of certain political prisoners.
“The irony is that sanctions often hurt people outside the ruling regime most,” said Dursun Peksen, a political scientist at the University of Memphis who has published numerous articles on the topic. “Sanctions often initially encourage the political opposition, but the regime expects that and so the regime becomes more aggressive in its repression.”
Press freedom goes down while secret police spending and subsidies to political cronies go up, Peksen said, all while liberal professionals like doctors and engineers flee if they can. Propaganda blames economic misery on the countries that imposed the sanctions, not the government’s actions that triggered them.
“Earlier examples suggest that Russia will end up a lot more authoritarian, with less political engagement, more poverty and more economic inequality, while groups that are close to the Putin regime will be OK,” said Peksen.
Moreover, sanctions are often difficult to remove once imposed for political reasons, since politicians want to avoid being labeled as “soft” on the offending country, so critics say targeted countries may reasonably conclude they have little incentive to comply since the benefits may never materialize.
Still, even a sanctions critic like Peksen was quick to add that something had to be done after Russia invaded Ukraine — and sanctions were probably the least-worst option in a conflict with a nuclear-armed former superpower.
“Inaction was not an option,” he said.