The US Recognizes Failure of Sanctions on Russia

The West has apparently set itself the target to bring Russia to its knees, by imposing sanctions but something went wrong. A recent American edition of the Foreign Policy magazine carried an article with the telling title "Let's Face it – Sanctions Failed." It seems that Washington finds it increasingly difficult to conceal unpleasant information from the public domain.

Sanctions have long been a favorite policy tool of the US administration to fight with its opponents. Currently, they are actively been used by President Barack Obama around the world. For example, against Russia, Iran, North Korea, some African countries. In other words, against all those who refuse to bow before the global hegemon and do not behave on the international scene as the United States would like them to do.

Jack Lew, US Treasurer, has expressed concern that because of the sanctions the capital flows will bypass the United States. It is interesting to note that two years ago, when sanctions against Russia were imposed, none of the American economists were worried. Today, according to experts, the financial flows have already bypassed US, and, apparently, even a complete lifting of sanctions will not bring them back on track.

In fact, such a pessimistic mood of the US Treasurer is evidence that the American elite has recognized the harm sanctions on Russia inflicted on the economy of the United States. Now, the White House is forced to constantly weigh the risks to the US economy.

Another important consequence of the sanctions on Russia has been the growth of anti-American sentiments among European elites. We now witness a clear division between the pro-American and the ‘national’ European elite. Such pattern is observed today in Germany, France and Italy, the countries in which the negative effects of sanctions most impacted.

Today we can say that groveling to US feet cost a big price for Europe. Evidently, Western analysts could not in a proper way predict the eventuality of retaliatory measures from Russia. When Moscow did respond with such measures many EU governments were shocked and even outraged. The question of appropriateness of the sanctions has caused prolonged disputes and contradictions. Europe was caught in the trap of its own rashness.

The conflict with Russia over Ukraine has become for the EU a huge trial, which the latter has been unable to overcome. The fact that the majority of EU member states subjected to transatlantic influence, have advocated for the preservation and continuation of the sanctions policy against Moscow, does not prevent the rest to question the correctness of such a rushed decision.

Internal problems of the Eurozone escalated when Russia introduced an embargo on food imports. Not expecting such a ‘surprise gift’, Europe was not able to do anything about it and launched a broad anti-Russian campaign. First, the dissatisfaction was expressed in Eastern Europe, the Czech Republic, Slovakia and Hungary: countries which have close economic relations with Russia. Subsequently, in 2015 Italy, Spain, Greece and Cyprus joined the above mentioned countries expressing their discontent with the state of affairs vis-à-vis Euro-Russian relations.

Moreover, sanctions against Russia helped swell the ranks of Euro-sceptics. In the past two years Marine Le Pen, the leader of the National Front party, an opponent of the anti-Russian policy, has mustered a significant part of the French electorate, including Euro-sceptics. To the dismay of many European politicians, Le Pen stands for the development and deepening of cooperation with Russia. She openly supports the position of Russian President Vladimir Putin on a range of issues.

Germany finds itself also in a dire economic condition. Ordinary citizens, businessmen and various politicians are disgruntled at the sanction prone policy of Chancellor Angela Merkel. By all accounts, decline of the prestige of the Chancellor is largely due to her pro-American policy, her confrontation with Russia and her economic austerity measures. Merkel causes dissatisfaction among entrepreneurs who have spent more than twenty years to win the Russian market. Now because of her political whim they have suffered significant losses.

Due to the ban on exports to Russia the losses of European countries amounted so far to €120 billion. This means that about two million jobs are at risk of being lost. As for the loss of the United States, it is estimated to be in the region of $70 billion. The West seems to have dealt itself a wound with estimated financial losses, according to experts, reaching $755 billion.

The drive for sanctions on Russia proved that Western unity is a myth. There is no solidarity or consensus in the EU. As a result, sanctions against Russia have exposed not only the economic, but also the political and social problems in the West. If today the economic consequences mostly hit European satellites of the United States, in the long-term this could pose a threat to the monopoly of American hegemony.