This Week in Info War

Kremlin responds to tightening of U.S. sanctions

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The White House said on 28 July that U.S. President Donald Trump will sign pending legislation that imposes broader sanctions on Russia, shortly after Moscow ordered the United States to cut hundreds of diplomatic staff and said it would seize two U.S. diplomatic properties in retaliation for the bill. On 30 July, Vladimir Putin provided details: He ordered the United States to reduce its diplomatic personnel in Russia (comprised of both U.S. and Russian citizens, the latter usually in support positions) from 1110 to 455, a total which would bring it in line with the number Russian diplomats in the United States. The Russian government is also seizing two U.S. diplomatic properties—a dacha and a warehouse—following the Obama administration’s decision last December to take possession of two Russian mansions in the United States.  

In separate votes last week, both houses of Congress overwhelmingly supported slapping new sanctions on Russia. This effectively dashed the hopes of many in Moscow for a reset in relations. Under the new law’s provisions, Trump cannot ease sanctions against Russia without congressional approval. The bill also expands sanctions on the Russian energy, railway, metallurgy and mining sectors. It calls for annual reports on the activities of Russian oligarchs, key political figures and quasi-state organizations as well as other members of the ruling elite, including information on their wealth and influence on key sectors of the U.S. economy.
  
The legislation is a response to the conclusion by U.S. intelligence agencies that Russia meddled in the 2016 presidential election, and further punishes Russia for annexing Crimea and invading eastern Ukraine in 2014. It also reflects growing concern in Washington about the malevolent influence of Russian money, information and other influence operations more broadly. 

The public comments of Russian officials and state-controlled media on the U.S. sanctions bill combine weariness and vague threats of further retaliation. One prominent journalist close to the Kremlin warned that Putin’s “patience has seriously run out.” Deputy Foreign Minister Sergey Ryabkov claimed without elaborating that Moscow has a “rich toolbox at its disposal.” Russia’s Foreign Ministry complained of growing anti-Russian feeling in the United States, accusing “well-known circles” of seeking “open-confrontation,” while influential Duma member Aleksey Pushkov called Trump “a prisoner of Congress and anti-Russian hysteria.” Privately, according to one veteran Moscow observer, there is panic among some elites who realize that the Kremlin’s hope for better ties with the Trump administration is likely dead. (Given the political climate in Washington, it will be almost impossible for opponents of sanctions to muster a Congressional majority for repeal anytime soon). 

So far, the Kremlin has not acknowledged meddling in the U.S. elections or admitted military involvement in Ukraine. Nor has it given any indication that its misbehavior elsewhere will change. Some Russian commentators even have suggested the Kremlin exploit European dissatisfaction with the new U.S. legislation; it is seen in some quarters as a lever to promote U.S. energy interests in Europe and hit European firms involved in Russia-related projects such as Nordstream 2. But in the European Union, Russia is widely regarded as an untrustworthy partner. Last week, Germany asked the EU to add to its blacklist additional Russian nationals and companies because Siemens turbines were delivered to Crimea despite assurances from high-ranking Russian officials that this would not happen. (The EU has barred its firms from doing business in Crimea since Moscow’s illegal annexation in 2014). Germany and France also hold Russia responsible for cyber attacks and interfering in their elections. 

The immediate impact of the new U.S. sanctions is likely to be relatively minor. Over the past few years, Russia’s economic problems resulted more from declining oil prices, massive corruption and a poor investment climate rather than Western penalties imposed in retaliation for Moscow’s illegal annexation of Crimea and its invasion of eastern Ukraine. The bill’s major geopolitical significance, however, is that it decouples sanctions from the Ukraine war, where they could be quickly softened if the Kremlin played a constructive role in the peace process. It now locks them in as part of a general U.S. effort to rein in Russian international misbehavior. With few economic levers available to push back, the Kremlin is likely to prefer a geopolitical answer: making trouble for U.S. policy toward Syria, Iran, North Korea or Venezuela (though on each of these questions it recently has tried to make trouble even without stricter sanctions).  

Internally, Russia is likely to cope one way or another with the new restrictions too, though the decline in Russian productivity and technological development is likely to continue, in part because it will be more isolated than before from Western investment and know how. The U.S. legislation will allow the Kremlin to inaccurately portray Russia as surrounded by enemies, thereby providing a rationale for keeping the current elite in power and removing a constraint should the Kremlin choose even harsher repression. Taking a back seat, as usual, will be ordinary Russians, who will have to watch their leaders divert scarce resources from painful internal problems to create the illusion that Russia, outside of the military dimension and its capacity to make mischief, is a Great Power.

Photo: Alexei Nikolsky/TASS