Obama’s Ukraine Sanctions Balancing Act

The trick in using sanctions against Russia is not causing economic harm to the people we have a duty to protect. Like it or not, much of NATO is doing business with Russia.  The EU has been struggling with a long recession and remains economically fragile.  The EU needs Russian energy sales and it needs Russian markets for the goods the members produce. If the economic sanctions coming on Monday result in rapid inflation combined with pressure against the Ruble, the costs of EU goods may become out of reach to most Russians.  Also, both Russia and the EU benefit from the sales of Russian gas and oil.  With resistance to any sales of liquefied gas from the U.S. fracking boon being felt from sectors of Mr. Obama’s own party, his options are limited. My guess is the sanctions will seem insignificant at first blush.  But, when judging a weapon in an economic war, it is important to look closely at the details.  The assault on the insider oligarchs can be quite effective if your goal is to influence policy.  Targeting the top echelon of a Kleptocracy is also great theater.  Dictators have to rule within the limits of their own power.  With President Obama likely to expand conflict within the small group of top Kremlin insiders, the Russian dictator may have to start sleeping with one eye open.

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