WASHINGTON — As war raged across Ukraine Thursday, President Biden announced sweeping new sanctions against Russia designed to force it to “bear the consequences” for the invasion, but faced tough questions about whether the response goes far enough.
Speaking at the White House, Biden outlined actions targeting “corrupt billionaires” profiting from the Kremlin’s policies, blocking Russian banks from US markets and in some cases seizing their assets, and prohibiting large state-owned companies from raising money from US and European investors. The United States also put in place restrictions that Biden estimated would block half of Russia’s high tech imports over time, hurting its military and aerospace industries as well as the nation’s ability to compete economically.
“The sanctions we imposed exceed anything that’s ever been done,” Biden said. “They are profound sanctions.”
But Biden stopped short of levying some of the most severe penalties — at least for now — raising questions about whether the US response will be enough to deter Russian President Vladimir Putin and his imperial ambitions.
Biden did not endorse calls to cut Russia off from the SWIFT international banking system that is vital to global financial transactions. And he declined to hit Putin directly with personal sanctions that would prevent him from accessing the US financial system or any assets he holds in it.
The administration also has pointedly avoided sanctions that would affect Russia’s oil industry, the country’s top moneymaker, given that would likely hurt NATO states, including the United States, that import their oil and could drive up prices.
Biden said tougher measures remain on the table, and stressed that he was unable to bar Russia from the SWIFT financial system given European allies’ objections to that move.
“Let’s have a conversation in another month or so to see if they’re working,” Biden said of the new sanctions.
But some urged Biden to go further now. Ukraine’s president, Volodymyr Zelenskyy, demanded in a Twitter message that Russia be disconnected from SWIFT as part of the response from the United States and its allies.
“As we seek to impose maximum costs on Putin, there is more that we can and should do,” added Bob Menendez, the New Jersey Democrat who chairs the Senate Foreign Relations Committee. He said the United States should “not shy away from any options,” including removing Russia from SWIFT and personally sanctioning Putin.
And Senator Mitch McConnell, the Republican minority leader, urged the administration to “ratchet up” the response and criticized Biden for not imposing tough sanctions before the invasion took place.
“Sadly, deterrence after the fact is not deterrence at all,” McConnell said in a statement.
With Biden reiterating the United States would not send its own troops into Ukraine, sanctions are the only weapon available to counter the invasion. And historically they are an imperfect one, particularly with a nation such as Russia that has taken steps over the years to insulate itself from sanctions, experts said.
Sanctions tend to work best before they are even levied, with the threat of economic pain causing leaders to back down, according to T. Clifton Morgan, a political science professor at Rice University who has studied 1,400 instances of sanctions that were threatened or imposed from 1945 to 2005. He found sanctions only worked to achieve their aims about half of the time.
“Generally, sanctions are more effective at the threat stage than after they’ve actually been imposed,” Morgan said.
In this case, Morgan said, Putin has probably already decided the cost of threatened sanctions from the United States and its allies was worth the risk of the invasion.
“It is conceivable they’re going to end up costing him a lot more than he anticipated and that he would find a way out of this, but I really doubt it,” Morgan said. “I think he has a real good idea that he’s willing to suffer those costs.”
Putin is not as dependent on public opinion in his country as Western democratic leaders, so broad economic pain isn’t as much of a threat to his rule, experts said. Targeting oligarchs and other Russian elites close to him, as well as possibly Putin himself, could be more effective, however.
On Thursday, the Russians the United States hit with individual sanctions included Putin allies such as Sergei Ivanov, Putin’s former chief of staff, and Igor Sechin, his longtime crony and chairman of the board of Russia’s state oil company. The list also includes Yuri Soloviev, chairman of the Russian VTB Bank’s management board, and his wife, Galina Olegovna Ulyutina.
“Russia . . . is a syndicate of oligarchs and they’re people who actually give the support that Putin needs to function,” said Representative Bill Keating, a Democrat from Bourne, who is urging Biden to expand the US response.
On Wednesday, Keating unveiled bipartisan legislation that would impose sanctions on members of the Russian Parliament who voted in favor of recognizing the Ukrainian regions of Donetsk and Luhansk as independent states, the pretense Putin used for launching the invasion.
Aleksei Navalny, the Russian opposition leader who is now jailed in that country, has stressed the importance of sanctioning individuals as a way of hurting Putin, Keating said. And Keating urged Biden to sanction Putin directly, even though he’s probably protected most of his vast wealth, to show there’s a price to be paid for his actions.
Others are skeptical that going after Putin’s or his friends’ assets will have much of an effect, given the lengths they probably have gone to shield their assets and Putin’s more sweeping geopolitical ambitions.
“He defines the issue as a national security issue and his own political status and reputation is on the line, so even if people in his close circle may get hurt by sanctions, I’m not sure that will be enough to pressure Putin into compliance with these demands from the Western powers, like withdrawing from Ukraine,” said Dursun Peksen, a political science professor at the University of Memphis and expert on sanctions.
Still, it’s important for the United States to impose the threatened sanctions, both in hopes Putin has miscalculated and for other nations to know the threats will be followed by action, Morgan said.
“What makes sanctions work fairly frequently at the threat stage is the knowledge that they often are imposed, and if we just never impose them then the threats wouldn’t have any credibility,” he said.
The White House cast the sanctions as crippling, and defended its decision to wait to impose most of them until after the invasion.
“The sanctions measures we imposed today I think without question are the most consequential levied on Russia and arguably the most consequential ever levied in history,” said Daleep Singh, deputy director of the National Economic Council.
Singh said the sanctions were carefully designed not to interfere with the gas Russia provides to other nations, hurt the US economy more than necessary, alienate US allies, or to target ordinary Russian civilians. “We’re not cowboys and cowgirls pressing a button to impose costs,” Singh said.
The new sanctions will trigger an “intensifying negative feedback loop” that would lead to a weaker ruble, higher inflation, outflow of money, and lower investment, he predicted.
Biden predicted the sanctions would weaken Putin at home as the Russian economy begins to suffer.
“It will so weaken his country that he’ll have to make a very, very difficult choice of whether to continue to move toward being a second-rate power or, in fact, respond,” Biden said.
Still, even as he predicted that Putin would suffer politically from the economic effects of his aggression, Biden appeared to be concerned about American voters’ tolerance for higher gas prices and other potential effects of the US decision to sanction Russia.
“I know this is hard and that Americans are already hurting,” he said of gas prices, and vowed to do whatever he could to alleviate more hikes.
But he warned that doing nothing to retaliate against Putin would ultimately harm Americans more in the long run.
“America stands up to bullies,” he said. ”We stand up for freedom. This is who we are.”