Will New U.S. Sanctions Regime Finally Hit Putin and Those Closest to Him?

(Paul Goble – Window on Eurasia – Staunton, August 2, 2017)

Western sanctions on Russia up to now have hit the ordinary people of that country, although not as hard as the countersanctions the Kremlin itself has imposed. But the Western actions have done less to affect those closest to Vladimir Putin who, unlike the Russian people, may be in a position to demand he change course or even leave office.

The Western sanctions regime in response to Putin’s aggression against Ukraine has been based on the assumption that if his people suffer, he will change his position. But Putin cares very little about the suffering of his people – indeed, he has hurt them far more by his counter-sanctions than the original sanctions did.

Moreover, as ever more polls show, Russians even though they have been impoverished at least in part by the sanctions/counter-sanctions combination are adapting to their new reduced circumstances and at least as ready as they were earlier to support Putin and his regime (znak.com/2017-08-02/eksperty_konstatiruyut_chto_rossiyane_privykli_k_krizisu_i_stali_bolee_dovolnymi).

The sanctions regime to date did not hit Putin’s core supporters: the oligarchs and the super-rich whose position his regime has made possible. Indeed, new information shows that Russia’s billionaires became significantly richer in the first half of this year (kasparov.ru/material.php?id=598172C1AD868).

The new US sanctions law that President Donald Trump signed into law today promises to change that because it calls for investigations in the wealth and holdings of Russia’s wealthiest, something that would be at least a nuisance and in the view of some would strike at Putin “personally” (nv.ua/opinion/piontkovskiy/kak-sanktsii-ssha-udarjat-lichno-po-putinu-1583825.html).

That, of course, assumes that the measure will be implemented as its backers intended, but Trump has been anything but enthusiastic about a law that ties his hands and makes it far more difficult to achieve the rapprochement with Russia that he suggested during his campaign he wanted to pursue.

And thus it should surprise no one that some lawyers and businessmen are already discovering “loopholes” in the law that might be used to allow individuals or corporations to escape what the authors of the measure appear to have intended, as Russia’s RBC news agency reports today (rbc.ru/economics/02/08/2017/5980a5289a794754fb147bc2).

It analysts point out that the new law has a provision that wasn’t in the original draft. That provision provides that the government can issue “routine” licenses to companies to do business with Russia if that “does not introduce essential change in the policy” of the US toward Russia.

RBC cites US lawyers as saying that this change “leaves to the president real freedom to issue license which permit actions which otherwise would be subject to punishment” and that the measure does not provide any means for those who object to any such grants to appeal them except via the federal courts.

That in turn means that the Trump Administration could issue licenses under this law which would allow certain Russian figures to fly under the provisions of the act in their dealings with the United States and thus feel less pressure from the new measure than many now are assuming.

[Article also appeared at windowoneurasia2.blogspot.com/2017/08/will-new-us-sanctions-regime-finally.html]

[featured image is file photo, not directly related to article subject matter]