The World Has Moved to Sanction Russia. Will It Make a Difference?

Russian citizens wait in line to use an ATM in St. Petersburg 2/25/2022. Source: AP Photo/ Dmitri Lovetsky

Confronted with the first territorial war on the European continent in some time, nations across the globe have weighed options to intervene in the conflict. Should nations join up in arms or say no to war? This is not the fundamental question being asked in this scenario. Instead, states have taken a less “hot” approach in response to Ukraine’s invasion. In particular, there has been a resounding response by Western nations through the use of economic sanctions. 

Economic sanctions are a withdrawal of international monetary/trade relations between countries. This can range from the freezing of foreign assets, restrictions on international trade, and removal of international banking privileges. As the world resoundingly recognizes Russia as the aggressor in its war with Ukraine, European nations, the U.S., and other nations abroad have instituted sanctions against Russia in order to deter further conflict. 

In fact, as of last week, Russia is now the most sanctioned nation in the entire world. According to Bloomberg, the invasion of Ukraine prompted state governments to institute 2,778 new sanctions — which bring the total number of sanctions against Russia to 5,530. Still, the question remains. Will the economic pain brought upon Russia by these sanctions break their resolve in continuing the invasion of Ukraine? 

Actions from governments around the world have been to isolate Russia in the international monetary regime. On February 26th, the EU and the U.S. moved to ban Russian banks from the SWIFT global financial messaging system. The SWIFT system is more or less responsible for facilitating millions of high-valued international transactions. By being removed from the system, Russians will have more difficulty with making or receiving payments from outside its borders. That being said, this move was not absolute. European leaders are attempting to make a carve-out for transactions regarding energy, as much of the European continent is reliant on Russia for oil and natural gas. 

This is just one of the actions being taken against Russia, but the consequences of this are very real. Likewise, the consequences will not solely affect the populations of Russia. For example, as Russia is an enormous oil producing nation, the oil market has realized a shock. In two months, a barrel of oil has increased from $88 to $127. Oil is a global commodity and this increase in price will hit working class people everywhere the hardest. This is one negative externality from sanctions but overall, the Russian people will be hit the hardest. 

Sanctions are used as a tool to inflict pain on a nation’s domestic population in the hopes that those in power will face a political price. There is no difference in this conflict, as Russian citizens are facing the brunt of the sanctions. For example, as the sanctions had started to be announced, Russia's currency, the Ruble, lost a considerable amount of value. The Ruble went from trading at 77 Rubles per U.S. Dollar to 132 per U.S. Dollar. Essentially, the purchasing power of Russian citizens fell off a cliff.

This is not the only front where the Russian people are feeling the squeeze of sanctions — but it paints a picture of their effect. Sanctions have been in the international playbook for years and are often implemented by the United States. However, they have often failed to reveal concrete changes to the actions of our geopolitical adversaries. 

Russia has been under sanctions from the West since 2014. According to Cornell history professor Nicholas Mulder, these sanctions have reduced the economic growth rate and caused the standard of living in Russia to stagnate. All the while, the Russian government has not fundamentally changed their behavior and sanctions have caused the Russia-U.S. relationship to worsen. Of course, Russia is not the only country to be sanctioned by the U.S. 

Since 1962, America has implemented an economic blockade against Cuba in the hopes of regime change. Iran has been sanctioned for their involvement with terrorism, nuclear arms program, and overall hostility to America. Likewise, Iraq was sanctioned due to its invasion of Kuwait and Libya was sanctioned in the ‘90s as well. 

In all of these cases, circumstances regarding the regimes targeted are generally the same. All of these states were controlled by authoritarian governments hostile to the U.S. and the sanctions did not produce important changes. While sanctions greatly affected the lives of the citizens of these states, the behavior of the regimes or regimes survival is not entirely dependent on the citizenry. 

Authoritarian regimes can have a greater resolve for enduring sanctions as they are less responsive or altogether unresponsive to citizens. Did sanctions effectively change the behavior of any of the regimes mentioned previously? Cuba? Still hostile and authoritarian. Iran? Still hostile and developing nuclear arms. Iraq and Libya? Remained hostile until the U.S. removed or played a hand in removing the sitting regime. 

All in all, levying sanctions against authoritarian regimes have not been historically successful for the United States. That being said, these sanctions against Russia are a better approach than direct confrontation and risking nuclear war. The sanctions placed upon Russia have been imposed in unison by many powerful nations and a degree greater than sanctions seen previously in history. 

Still, this conflict has only been going on for a relatively short period of time. No one knows how strong Russia’s resolve is in bearing the costs of these sanctions. No one can say whether these sanctions will help bring an end to this war. However, history has shown that sanctions cause real human suffering and have yet to win major concessions for the U.S.