Russia is hurting under sanctions. Don't abandon this weapon in the false belief that sanctions are futile or counter-productive.
Five months into the Russian invasion of Ukraine, there remains a startling lack of understanding by many Western policymakers and commentators of the economic dimensions of President Vladimir Putin’s invasion and what it has meant for Russia’s economic positioning both domestically and globally.
Far from being ineffective or disappointing, as many have argued, international sanctions and voluntary business retreats have exerted a devastating effect over Russia’s economy. The deteriorating economy has served as a powerful if underappreciated complement to the deteriorating political landscape facing Putin.
The authors go over the areas in which Russia is hurting but which Westerners don't perceive from lack of information and Russian disinformation that have created myths that Russia is doing just fine economically and financially:
First, Russia can't easily replace European natural gas customers with Asian customers.
Second, the situation with oil exports to Europe is similar.
Third, Russia is not replacing Western business ties and imports with Asian partners.
Fourth, Russia's consumers and domestic economy is faltering.
Fifth, Russia has suffered a brain and investment drain.
Sixth, Russia is running on deficit spending.
Seventh, Russia's "rainy day" reserve funds are under stress and inadequate.
Eighth, the ruble's strength is a Potemkin Village that provides no advantage to Russia.
Ninth, there is room for more sanctions to do more harm to Russia's economy.
The authors conclude:
Defeatist headlines arguing that Russia’s economy has bounced back are simply not factual—the facts are that, by any metric and on any level, the Russian economy is reeling, and now is not the time to step on the brakes.
I was skeptical of sanctions alone working as an alternative to military action to change the actions of a target nation before Russia invaded Ukraine this year.
Although Russia is now at war and sanctioned. So my qualification is met. And the Russians have incentive to lie in order to convince Westerners to give up sanctions.
Don't let the Russian firehose of falsehoods convince us that we hurt ourselves more than we hurt Russia.
NOTE: My most recent war coverage continues here.
