U.S.-Allies' Sanctions Target Russian Officials

U.S.-Allies' Sanctions Target Russian Officials
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President Obama, joining with European allies, on Monday sanctioned Russian government officials and some of their closest supporters less than a day after Ukrainians in Crimea overwhelming voted to join Russia.

Not since the end of Cold War with the Soviet Union has the United States imposed punishments as severe or comprehensive, the administration said, acknowledging that tensions have impacted bilateral relations with Russia and could prompt retaliatory sanctions that may be felt by Americans and Europeans if the impasse continues.

The president, speaking at the White House, again urged Russian President Vladimir Putin, with whom he spoke Sunday, to pull Russian troops back to their bases in Ukraine, to support international monitors there, and to enter into “a dialogue” with the government of Ukraine.

That message was another in a series of warnings before Putin decides whether to officially annex Crimea in the wake of what the Obama administration and NATO dubbed “the so-called referendum” a day earlier in Ukraine’s ethnically Russian Crimean peninsula. The United States and the European Union condemned the referendum as illegal and unconstitutional, and said the vote tally proved undemocratic and rigged.

The United States expects Putin to announce the Russian Federation’s annexation of Crimea on Tuesday, and the international community is closely monitoring Russian troop movements in Ukraine. NATO on Monday issued a statement urging “the Russian Federation not to take any steps to annex Crimea.”

Obama said Vice President Biden was traveling to meet with NATO leaders in Poland, Estonia, Latvia and Lithuania. Next week, Obama will be in the Netherlands for a nuclear summit; in Brussels for an EU-U.S. meeting; Rome to meet with Pope Francis; and in Saudi Arabia during a trip that has been long-planned.

“If Russia continues to interfere in Ukraine, we stand ready to impose further sanctions,” Obama said in brief remarks delivered in the White House briefing room.

The United States and its allies, as a next step, could adopt economic sanctions to further isolate Russia, senior administration officials said Monday. That warning also is intended to rattle Russia’s wealthiest business titans, known as oligarchs, who are closely allied with Putin. The administration referred derisively to Putin’s “cronies,” noting that while they were not named in the sanctions order Monday, their freedom to travel and their business lifeblood would be constrained if events escalate.

Russia will feel the squeeze of the latest U.S. punishments that expressly name 11 individuals – a list that does not include Putin because it is deemed rare to target a head of state – as well as EU sanctions naming 21 individuals, officials said.

The freeze on assets effectively precludes any U.S. person from doing business with the targeted individuals, and blocks financial transactions through the United States and, in coordination with allies, through Europe and through financial institutions in the Gulf, and perhaps in Asia. “I think they’re going to run into difficulties,” explained one senior Obama official who helped design the sanctions.

The U.S. action, coordinated with European nations, is intended to punish seven top Putin advisers in the Russian government, plus some of those who furnished material support to the government and used against Ukraine, as well as a collection of ousted Ukrainian government officials sympathetic to Moscow, including former President Viktor Yanukovych.

“There’s no question that this hits close to home,” another senior official said of Obama’s new sanctions order.

The phased escalation of punishment, which follows a strategy agreed upon in collaboration with European partners, began with travel restrictions and warnings, followed by asset freezes, and if necessary will expand to broader economic sanctions that would impact Russia’s global transactions, and not just the holdings of individuals. European nations, because of their energy dependency on Russia, have been reluctant to target its natural gas and energy sector.

The president’s order Monday expanded his March 6 “framework” for sanctions to respond to Ukraine’s troubles. The administration earlier this month also revoked or barred visas for about a dozen Russian and Ukrainian officials.

Putin’s aggressive actions in Crimea and the condemnations those actions ignited have proved costly to Russia’s economy even without asset freezes or economic sanctions, the administration believes. The Russian stock market has plummeted 14.7 percent since Feb. 20, and Russia’s currency has declined 3 percent against the U.S. dollar.

While Obama pledged Monday to “stand firm in our unwavering support for Ukraine,” it remained unclear beyond the escalation of sanctions whether the United States and its allies have other options in mind that could prompt Russia to rethink its march across its border.

The president continued to pledge economic aid to Ukraine, and he urged Congress to approve legislation later this month to unleash about $1 billion in U.S. assistance.

Russia may retaliate against the United States and its allies with sanctions of its own, administration officials conceded, but the aftermath is unlikely to prove as costly to Americans as sanctions could be for Russians, officials predicted.

Alexis Simendinger covers the White House for RealClearPolitics. She can be reached at asimendinger@realclearpolitics.com.  Follow her on Twitter @ASimendinger.

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