VOA Russian: What economic measures can US use to force Russia to end war?

This article was published in Russian- I put it through translate so those of us who can only read English can understand what the VOA is publishing in Russia, for a Russian audience. VOA is, of course, a US propaganda operation. It is the voice of America, to the world. Same as it’s always been.

That said, there is a whole lot of good information included in this piece. So, read it to the end and share some thoughts.

golosameriki.com

https://www.golosameriki.com/a/increased-economic-pressure-will-help-the-trump-administration-end-russia-s-war-against-ukraine/7965498.html

I used DeepL to translate

Experts on how sanctions, export controls and other forms of economic pressure will help the Trump administration end Russia’s war against Ukraine

Three years after Russia’s full-scale invasion of Ukraine, Russian forces are still unable to make significant gains on the battlefield, with Russia’s economy growing weaker and weaker.

While Ukraine’s economy is demonstrating its ability to adapt to extremely difficult circumstances, Russia’s inflation is rising, the “Welfare Fund” is drying up, and many resources, including those directly related to the frontline – ammunition and manpower – are running out, forcing the Kremlin to seek help from Iran and North Korea to replenish losses.

I’ve seen nothing that suggests to me the claims above are even remotely accurate- But, we’ll continue on

Against this backdrop, President Donald Trump has said the U.S. is prepared to increase economic pressure on Russia if the Kremlin does not end the war

The West’s approach to war will largely depend on its assessment of Russia’s economy.

There are those who believe that Russia will be able to allocate virtually unlimited resources to its war no matter what, and that Kiev should accept Moscow’s terms, even though such an outcome would amount to a Russian victory.

There are many more who believe that Russia’s economy is rapidly weakening and that the U.S. and allies must tighten sanctions and increase enforcement – especially on Russian energy and metals – to force Putin to pursue peace. And that’s the outcome – for obvious reasons – that’s better for both Ukraine and the U.S. and the West.

Be that as it may, no one has any doubt that growing economic pressure will weaken the Russian war machine and bring closer the day when “the guns go silent.”

The Hudson Institute, a Washington-based think tank, brought together experts to discuss U.S. capabilities to apply this economic pressure on Russia

Challenges for the new U.S. administration

The invited experts are convinced that in order to weaken Russia and bring the war closer to an end, much more pressure can and should be applied to Russia’s economy so that Putin has no resources left to continue the war.

Ambassador James Glassman, former Under Secretary of State, believes that now is the time to redouble efforts to coerce Russia into peace.

According to Glassman, “the new U.S. administration still needs to continue supplying arms to Ukraine,” but it is even more important to “focus on economic pressure, especially in areas where there aren't even sanctions yet.”

Glassman named one of them as the export of Russian LNG (liquefied natural gas) to Europe, particularly Germany.

According to the expert, 20 percent more LNG came to Europe from Russia last year than the year before.”

“This really needs to be stopped urgently. And replace it with American LNG,” the former deputy secretary of state emphasized.

Why do many people think that sanctions do not work?

Rand Corporation Researcher

According to experts, it is partly because of the inertia of the sanctions and partly because the Kremlin manages to spread propaganda that Russia is “successfully overcoming” any economic pressure.

Charles King Mallory IV Senior International Defense Researcher, RAND, discussed why many believe sanctions are not the most effective way to apply pressure.

Sanctions researchers, Mallory said, “differ in their assessment of the effectiveness of sanctions against Russia, but none of them, even in their most pessimistic assessments, think they haven’t worked at all.”

However, as Mallory emphasized, “even in the case of very broad sanctions” that are most effective, “a huge role is played by ‘black knights’ – countries that act in ways that undermine the effects of sanctions on the sanctioned country.”

“Such 'black knights,' in the case of Russia, have turned out to be China and India, which buy large amounts of oil. So you have to be prepared to go after any middlemen who help circumvent sanctions. You have to be prepared to seize and confiscate cargoes and maybe even put them up for public auction, impose fines to maintain a real deterrent effect,” Mallory explained, adding that sanctions should only be strengthened.

The US has to go after China and India

The controlling role of Western institutions

Oleksandr Kalenkov, president of the Ukrmetallurgprom Association, described how the war changed the markets for many of Ukraine’s export products.

It is noteworthy that it was after the full-scale invasion that Kiev reoriented itself even more towards the European Union in many areas.

“We began to consider the European Union market as 'our domestic market,'” he emphasized. - And it pains us to see Russian products still being imported into the EU there, despite the fact that sanctions were imposed on many products as early as March 2022. Why did this happen? For a simple reason, because Russian companies own assets in some European countries. So, for example, steel companies from Russia own some rolling mills in Belgium, in Denmark and in the Czech Republic.”

And against these companies – EU sanctions are also necessary.

Sanctioning the companies that are operating in Belgium, Denmark and the Czech Republic, will cause unemployment in the local workforce/local or regional economy.

Charles King Mallory emphasized that when applying sanctions, one should keep in mind how adaptive an adversary can be.

“When the Russians can’t export gas directly to Europe, they divert it to produce metal that is imported to Europe. And when they can’t do that, they use it to produce fertilizer. European fertilizer producers are furious right now because Russia is dumping huge amounts of fertilizer created with energy-intensive gas. And if you can’t export cars directly to Russia, they will find another route, for example, through Georgia. Therefore, when imposing sanctions, we have to anticipate a lot of things: the interchangeability of gas, fertilizer production, secondary markets, intermediaries. And the countries imposing sanctions should be closely interconnected in their work”.

Mallory believes that Russia’s creation of a shadow tanker fleet could have been prevented from the very beginning, “by limiting tanker insurance to certain insurance companies, and by imposing safety requirements, linking mandatory inspection and repair of tankers at certain Western-controlled shipyards.”

Gold as a means of circumventing economic constraints

Charles King Mallory called gold transactions a threat to the effectiveness of the trade bans and a possible problem in the near future if new sanctions are imposed.

However, in order to prevent this, according to the expert, there are proven mechanisms of influence, ranging from a direct ban on gold exports by the sanctioned country, and ending with restrictions on the placement of gold (including certain types) on world markets.

How realistic is it to persuade Saudi Arabia to increase oil production?

James Glassman is not sure it will ever come to that.

The former undersecretary of state believes that “hitting Russian LNG and ‘pressuring Turkey to exclude Russian gas from Turkish Stream’ would be enough to cause panic in the Kremlin”.

We should remember that Ukraine has targeted Turksteam on at least 3 occasions, that I can recall

Charles King Mallory, on the other hand, believes in mechanisms to motivate OPEC allies to increase oil production.

He recalled how low oil prices once helped destroy the USSR, effectively “bankrupting the oil sector of the communist power.”

And today, according to the expert, “lowering global oil prices is the most effective way of destroying the Russian economy”.

I’m familiar with the narrative that the USSR was crushed through lowered oil prices, but, there are some that say this was never true or accurate.

Ukraine’s rare-earth metals in exchange for military support?

Oleksandr Kalenkov, president of the Ukrmetallurgprom Association, confirmed the presence of huge deposits of rare-earth metals in Ukraine.

Despite the capital-intensive nature of their development and extraction, the expert considers this area one of the very attractive for investment.

“I think this is a mutually beneficial proposition. It’s a win-win situation,” he explained.

Charles King Mallory added that this is “exactly what the U.S. could be in dire need of,” as “the world’s dominant supplier of rare earth metals is China,” which has already made it clear that if a new trade war with the United States breaks out, they will limit exports of rare earth minerals, which are required for virtually every item of consumer electronics.”

“And this is forcing the Trump administration to look for new sources in places like Greenland and Ukraine, where there are large reserves of these metals,” the expert explained.