The Russian sanctions information gap

By Steven Brill
July 29, 2014

Emergencies Ministry member walks at the site of a Malaysia Airlines Boeing 777 plane crash near the settlement of Grabovo in the Donetsk region

There are so many gaps in the reporting about the effort to use economic sanctions against Russia to get President Vladimir Putin to pull back support for the Ukraine separatists that it makes sense to devote my whole column this week to listing them.

Of course, it’s a lot easier to identify the gaps than to do the reporting to fill them. Still, many are so obvious that it suggests that for all the resources spent on getting great video of the Malaysia Airlines Flight 17 crash site, interviews with the victims’ families and reports from the war front in eastern Ukraine — all important stories — there is more heat than light being produced when it comes to the most critical, long-term question related to the Ukrainian conflict: If economic sanctions are the global economy’s modern substitute for using military force in repelling aggression, how is that playing out in the first test of that strategy against a global economic player like Russia?

The Dutch:

For starters, we need to see some reporting from the Netherlands, a country that, as we have been repeatedly reminded, lost a higher proportion of its population in the missile attack on the Malaysian airliner that left from the country’s flagship airport than America lost in the September 11 attacks.

The Shell logo is seen on a pump at a Shell petrol station in LondonWhy haven’t the Dutch simply shut down all business with Russia? Why are there still nonstop flights between Moscow and Amsterdam such as this one, every day?

I’ve read references  to the fact that the Netherland’s largest company — oil giant Royal Dutch Shell, a Dutch-British corporation — has multibillion-dollar assets and operations in Russia that could be threatened by sanctions. But that’s not enough.

Has Shell used its influence to lobby the Dutch government, the way a U.S. corporate giant might on Capitol Hill? If so, how?

What’s going on behind the scenes in Amsterdam and at the Hague in what has to be a heated debate over how to balance these economic interests with the country’s outrage?

What role is the United States playing in that debate? We know President Barack Obama has tried to push all the European countries to get tougher on Putin, but have U.S. business interests tried to intercede, perhaps through the Commerce or State departments, to soften that push? Which U.S. business interests have a stake in trying to soften any Dutch response?

The Rest of Europe:

We know that Germany, France and Britain have taken differing stances on stronger sanctions. But, again, we have little idea of the dynamics behind these decisions. Each would be a great story — not only about lobbying and business influence, European-style, but also about the larger question of whether it is realistic to assume that the political will can ever be summoned to impose economic sanctions that would substitute for military force.

Inside Russia:

There’s the question of whether and how the sanctions now in place are working. We need more reporting, difficult as it might be, from inside Russia about which people and companies, if any, are really being hurt — and whether they are trying to influence Putin to pull back.

Back in the United States:

Finally, there’s the story hiding in plain sight here at home. Beyond the get-tough rhetoric from many congressional Republicans, who in the Obama administration and in Congress has been pushing for tougher sanctions? What exactly would those be?

Who are the doves? What is their best argument against tightening the noose?

Did we consider cancelling the Aeroflot flights that come here, the way President Ronald Reagan did after the Russians shot down a Korean Air Lines flight in 1983? What arguments against that have prevailed this time?

What plans, if any, are in place to tighten the sanctions? And what do our experts anticipate the effect, and reaction, would be in Russia?

Have we thought about digital sanctions, such as cutting off Russian businesses from accessing U.S. businesses or information services on the Internet? Alternatively, are we trying, or do we plan to try, to use the Internet to break through Putin’s domestic propaganda machine?

Last issue and a big one: Could someone do a story explaining who has what authority to issue these sanctions. Can Obama simply do it on his own? Are there limits?

What about in the Netherlands or the other countries?

This kind of economic warfare seems to be here to stay. We need a lot more reporting from the front lines.

 

PHOTO (TOP): An Emergencies Ministry member walks at the site of a Malaysia Airlines Boeing 777 plane crash near the settlement of Grabovo in the Donetsk region, July 17, 2014.  REUTERS/Maxim Zmeyev

PHOTO (INSERT): The Shell logo is seen on a pump at a Shell petrol station in London January 30, 2014.  REUTERS/Suzanne Plunkett

2 comments

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/

The Obama Administration can draw on various legislation to implement sanctions, especially the Export Administration Act which allows for national security export controls (on dual use technology, military equipment) and foreign policy export controls, the purpose of which is to promote American foreign policy goals. Carter and Reagan utilized both to initiate controls against the Soviets, Libya, and South Africa, among others. The extra-territorial application of such controls, however, is always a controversial issue and the Europeans refused to enforce them when Reagan tried to force American subsidiaries in Europe to comply with the U.S. embargo of the Yamal pipeline.
Currently, the U.S. Chamber of commerce, the Business Roundtable and other corporate lobbies in the U.S. are fighting to ensure that no unilateral sanctions will be imposed by Obama, which would inevitably damage their business opportunities in Russian and allow European firms to fill the gap. However, multilateral sanctions will inevitably damage European business more than American business interests, given their larger stakes in terms of trade and direct foreign investment

Posted by Cassiopian | Report as abusive

Very good column. There is just so little follow up in today’s news environment.

Posted by L00kHere | Report as abusive