Did the U.S. destroy the Russian economy?

A question is being bandied about in the international press while the world watches the Russian economy implode.

Have the U.S.-led sanctions against Russia brought about the collapse?

http://www.politico.com/story/2014/12/barack-obama-vladimir-putin-russian-economy-113626.html?hp=t2_r

You remember when President Obama announced the sanctions after Russia annexed Crimea from Ukraine and sent troops into the neighboring country because Russian President Vladimir Putin didn’t like all that anti-Russia rhetoric coming out of Kiev.

Some hardliners on the right wanted the United States to do more, to bring military pressure to bear — perhaps by arming the Ukrainians who were fighting the advance of Russian armor and infantry into their country. The sanctions, they reckoned, wouldn’t have much of an impact.

Interesting that the sanctions all by themselves might have helped bring the Russian economy to its knees. The value of the ruble is plummeting, along with the price of oil, a major source of Russian income. The sanctions have tied up Russian investments abroad and have made it quite difficult for Russian businessman to function.

Russia remains a major military power. Its economic standing, though, has been reduced to second- or perhaps third-tier status.

According to Politico: “’It’s hard to disaggregate out the independent effects of the sanctions from the bigger story. Obviously the driver is oil prices,’ said Obama’s former ambassador to Moscow, Michael McFaul.

“’That said, there is no doubt that sanctions raise uncertainty about the Russian economy. Their own minister of economic development said today that the ruble is falling faster than the macroeconomic indicators would suggest it should be,’ McFaul added.”

The sanctions are punishing the one-time super power.

It remains to been, of course, whether Putin’s future adventurism will end. My guess is that he’ll have to think twice, maybe more, about getting involved in other countries’ internal affairs.

 

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