The Russia 'sanctions list' won't have worried anyone in Moscow

Late Monday night, the US Treasury Department ...

Posted: Jan 30, 2018 6:15 PM
Updated: Jan 30, 2018 6:15 PM

Late Monday night, the US Treasury Department released the so-called oligarch list, containing the names of officials and members of the business elite considered to be part of -- or enjoy close links with -- Russia's political leadership.

The list had caused considerable anxiety in Russian business circles before its release.

Statements by leading Russian business figures in recent weeks indicated that inclusion on the list -- which does not automatically result in an individual being sanctioned by US authorities but has been viewed as a "sanctions list in waiting" -- might significantly raise the cost of being associated with President Vladimir Putin's inner circle.

Of most concern was the prospect that business activities -- especially accessing capital and other financial services in the West -- might become more complicated and expensive for those included on the list.

It appears these fears may have been exaggerated. Included within the recently published list are 114 state officials and 96 "oligarchs." Most of the named officials appear to be there simply by virtue of the fact that they occupy senior positions within the state.

It seems no use of classified intelligence was made to identify key players in Russian elite politics beyond those already widely known. It is plausible that such a list could have been constructed using only English-language Wikipedia pages.

The list of "oligarchs" also seems to have been shoddily prepared. As some have pointed out, the list of business figures appears to have been taken directly from last year's Forbes list, with little effort made to discriminate between those who are close to the Kremlin and those who tend to focus primarily on business.

Included on the list are many officials and business figures who are either widely regarded as of peripheral importance at most, or in other cases, as those such as Vladimir Yevtushenkov, who have experienced strained relations with the political leadership in Russia, and would therefore not usually be included in any list of Putin's "inner circle."

There are also important omissions. For instance, any sensible analysis of elite dynamics in Russia would surely highlight the importance of the children of senior members of the elite who have been elevated to senior management positions in Russian business in recent years. But the list includes no such individuals.

Taken together, the effort that has gone into the compilation of the list might lead to one of two obvious conclusions: Either that the Trump administration and US authorities more widely are inept and have only an extremely limited understanding of how Russia is ruled, or that they have no serious interest in identifying the real movers and shakers of Russian politics beyond the obvious figures, many of whom are already subject to US and European Union sanctions.

The latter explanation is supported by the fact that the list's publication was accompanied by a statement from a US State Department official indicating the Trump administration would not immediately impose additional sanctions on Russia.

This was a curious development, given that Congress had demanded that President Donald Trump apply at least five from a list of 12 possible sanctions on Russia by the end of Monday. Trump instead chose to miss this deadline, with the State Department official claiming that existing sanctions were already achieving their desired effects.

The worst fears of Russian officials and business figures have not been realized. No new sanctions have been implemented, and the oligarch list does not appear designed to probe at any real nodes of weakness within the Russian ruling elite.

While some Russian officials reacted angrily, labeling US actions as an attempt to influence the forthcoming presidential elections in Russia and as evidence of its "political paranoia," Putin seemed relaxed. He joked that he felt slighted by his omission from the list, and stated that despite the "hostile step" Moscow remained eager to develop closer relations with the United States if his American counterparts are willing.

All of which suggests that relations between the two administrations might not have been as severely damaged as many initially feared. How long this remains the case is unclear. By subverting the will of Congress through his refusal to implement new sanctions, and by refusing to apply real pressure on the Russian elite, Trump may only have further fueled suspicions of his close relations with the Kremlin.

If so, further twists in the downward spiral of US-Russian relations can be expected.

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