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At the time, Biden made a couple of predictions.
- “This is going to take time,” he said. Russian President Vladimir Putin “is not going to say ‘oh my God, these sanctions are coming, I’m going to stand down.’ He’s going to test the resolve of the West to see if we stay together. And we will.”
- But, Biden forecast, “the notion that this is going to last for a long time is highly unlikely.”
It’s been about one year and one month — so roughly one year since Biden’s suggested wait-one-month timetable. Have the sanctions worked? The Daily 202 is giving this a split decision. The sanctions have been:
- Economically effective, in terms of doing damage to Russia’s economy; and
- A strategic squib, in that they haven't convinced Putin to end his war.
Things can change quickly, though. After months of insisting Russia’s economy was weathering the financial storm just fine, Putin admitted the sanctions “in the medium term can really have a negative impact on it,” Agence France-Presse reported. Putin had sunny forecasts about low unemployment (thank you, government spending and mass mobilization) and lower inflation in March (basically because inflation surged after he expanded the war, so March 2023 vs March 2022 won’t look so bad.)
Biden was obviously right to say the sanctions would “take time” to bite. Whether “this” has lasted “for a long time” is subjective — it surely feels longer in Kyiv, or Bakhmut, under a steady rain of Russian bombs, than it does in America.
The question of a united front is more complicated, though. America and its allies have hung together surprisingly well (surprisingly, because of Europe’s thirst for Russian oil and gas before the war). But plenty of large economies — China and India come to mind — aren’t on board, to say nothing of the Global South.
Still, Russia is now the most sanctioned country in the world. The expanded war brought 11,458 more sanctions against Moscow, compared to 2,695 beforehand, according to Castellum.ai, a global database that tracks sanctions.
Over 1,000 companies have reduced or eliminated operations in Russia, according to a Yale School of Management database. But as the database shows, many still remain with varying levels of operation, from business as usual to scaled-back-but-still-present.
How much economic impact?
Numbers of sanctions or companies tells you a little about the potential effect. But what about actual economic impact?
Over at the Wall Street Journal, Georgie Kantchev and Evan Gershkovich had a nice dive on Tuesday into the Russian economy.
“The country’s biggest exports, gas and oil, have lost major customers. Government finances are strained. The ruble is down over 20% since November against the dollar. The labor force has shrunk as young people are sent to the front or flee the country over fears of being drafted. Uncertainty has curbed business investment,” they reported.
Kantchev and Gershkovich note the fall in government revenue may make it harder for Putin to balance swollen military spending and the spending with which he has tried to limit the impact of sanctions on the Russian population.
Moscow has become more dependent on China, leading some in the West to call it Beijing’s “junior partner.”
Kantchev and Gershkovich also told us:
- Russia is selling its oil at a discount. In the first two months of 2023, “oil and gas tax revenue, which accounts for nearly half of total budget revenue, fell by 46% year-over-year;”
- Russia faces a labor shortage;
- Its civilian industry is struggling to obtain microchips; and
- Auto output is down 45% year-on-year.
A healthy, vibrant, sanctions-proof economy, this is not.
But Putin hasn’t come to a point of choosing
Are the sanctions taking a toll? Yes. And the longer this goes on, and the more the world sees developments like the International Criminal Court issuing a war-crimes warrant for Putin, the harder it’ll be for Russia to get back to business-as-usual with Western companies that fled.
But there’s no getting around the fact that, as badly as the war has gone for Moscow, Putin is showing no signs of backing down.
In some ways, this is the classic conundrum of assessing economic sanctions. Do they “work” when they achieve the economic goal of imposing them? Or when they bring about the policy goal?
Biden wanted a month to assess the sanctions. He played down prospects of this being a lasting conflict. He said Putin would eventually bow in the face of a U.S.-led united front.
The Russian leader may yet try to cut his losses, especially in the face of the steady flow of advanced weapons from the United States and its partners to Ukraine.
But for the sanctions, it’s Mission Incomplete, not Mission Accomplished.
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What’s happening now
Senate to vote on repeal of authorizations for Iraq, Gulf wars
The Senate is poised to vote on a bill today that would repeal decades-old authorizations for use of military force for the Iraq and Persian Gulf wars, legislation the White House has signaled it will back, Amy B Wang reports.
“The bill is likely to pass with strong bipartisan support, as it did in procedural votes earlier this month that brought together an unusual coalition of lawmakers.”
Drug overdose antidote Narcan goes over-the-counter
Narcan, the lifesaving nasal spray that reverses opioid overdose, can now be purchased without a prescription, the Food and Drug Administration announced, marking a long-awaited decision that could dramatically broaden the availability of the lifesaving medication, David Ovalle reports.
“The over-the-counter version is expected to be made available by the late summer, but its long-term impact remains unclear: It will depend on the price set for the spray by its manufacturer and retailers’ willingness to stock it on store shelves in easy view of consumers.”
Zelensky says Bakhmut loss would let Russia push for unfavorable deal
A Russian victory in Bakhmut would increase the global and domestic pressure on Kyiv to concede to an unfavorable deal with the Kremlin, Ukrainian President Volodymyr Zelensky said in an interview with the Associated Press.
U.S. Secretary of State Antony Blinken said calls from some nations for a cease-fire in Ukraine could be a “very cynical trap” designed to allow Russia to consolidate the territory it has illegally seized and “use the time to rest and refit and then reattack,” Annabelle Timsit and Rachel Pannett report.
Lunchtime reads from The Post
D.C. U.S. Attorney declined to prosecute 67% of those arrested. Here’s why.
Last year, federal prosecutors in the District’s U.S. attorney’s office chose not to prosecute 67 percent of those arrested by police officers in cases that would have been tried in D.C. Superior Court, a striking statistic as the District grapples with rising crime and increased attention from federal lawmakers over public safety issues, Keith L. Alexander reports.
- “Matthew M. Graves, the Biden-appointed U.S. attorney for the District, said his office was continuing to prosecute the vast majority of violent felonies. He said prosecutors were declining less serious cases for myriad reasons, including that the city’s crime lab remained unaccredited and police body-camera footage was subjecting arrests to more scrutiny.”
Millions poised to lose Medicaid as pandemic coverage protections end
“At the end of this week, states will begin to sever an anticipated 15 million low-income Americans from Medicaid rolls that ballooned to record heights because of a pandemic-era promise that people with the health insurance could keep it — a federal promise that is going away,” Amy Goldstein reports.
“The end to the temporary guarantee that preserved the safety-net health coverage for the past three years saddles every state with an immense undertaking: sorting out which Medicaid beneficiaries actually belong.”
… and beyond
China Threatens Retaliation If Kevin McCarthy Meets Taiwan’s Tsai Ing-wen
“China said it would retaliate if House Speaker Kevin McCarthy meets with Taiwanese President Tsai Ing-wen during her planned stop in California next week, further stoking tensions around a highly scrutinized visit that is poised to test strained ties between Beijing and Washington,” Wenxin Fan and Joyu Wang report for the WSJ.
Republicans Face Setbacks in Push to Tighten Voting Laws on College Campuses
“Alarmed over young people increasingly proving to be a force for Democrats at the ballot box, Republican lawmakers in a number of states have been trying to enact new obstacles to voting for college students,” Neil Vigdor reports for the New York Times.
- “In Idaho, Republicans used their power monopoly this month to ban student ID cards as a form of voter identification. But so far this year, the new Idaho law is one of few successes for Republicans targeting young voters.”
The Biden agenda
Biden’s Summit for Democracy is a tough hill to climb
The Biden administration’s second Summit for Democracy in Washington kicked off today, bringing together representatives from around 120 countries for an event that has become a major plank in President Biden’s vision of “restoring” American leadership on the world stage, Ishaan Tharoor reports for Today’s WorldView.
“But, in private, some U.S. officials and many foreign policy experts in Washington roll their eyes over the whole affair. Critics see the event as an inconsequential talk shop or an unwelcome showcase into the inconsistency of U.S. foreign policy on the world stage, as Washington goes to bat for human rights in some contexts and looks the other way in others.”
Israeli PM, Biden exchange frosty words over legal overhaul
“Israeli Prime Minister Benjamin Netanyahu on Wednesday rebuffed President Joe Biden’s suggestion that the premier “walks away” from a contentious plan to overhaul the legal system, saying the country makes its own decisions,” Ilan Ben Zion reports for the AP.
“The exchange was a rare bout of public disagreement between the two close allies and signals building friction between Israel and the U.S. over Netanyahu’s judicial changes, which he postponed after massive protests.”
Biden administration moves ahead with massive Gulf of Mexico drilling auction
“A few weeks after allowing the controversial Willow oil drilling project in Alaska to go forward, the Biden administration is auctioning off more than 73 million acres of waters in the Gulf of Mexico to offshore oil and gas drilling,” CNN’s Ella Nilsen reports.
“The administration was forced to hold the sale after Sen. Joe Manchin (D-W.Va.) added it to the Inflation Reduction Act, the major climate and energy bill that President Joe Biden signed last year.”
U.S. school shootings since Columbine, visualized
The Washington Post has tracked 376 school shootings in the U.S. since the massacre at Columbine High in 1999, John Woodrow Cox, Steven Rich, Linda Chong, John Muyskens and Monica Ulmanu report.
“Across all such incidents, The Post has found that at least 199 children, educators and other people have been killed, and another 424 have been injured.”
Hot on the left
Sanders to grill Starbucks founder Howard Schultz in Senate hearing
“Starbucks founder Howard Schultz unequivocally denied that the coffee giant had broken the law in its fight against unionization during a tense questioning from Sen. Bernie Sanders (I-Vt.) on Wednesday,” Lauren Kaori Gurley reports.
“The push to unionize Starbucks is one of the most high-profile labor campaigns in decades. Starbucks workers since late 2021 have voted to unionize at almost 300 locations out of more than 9,000 corporate-owned stores in the United States. But organizers of the Starbucks Workers United campaign accuse Starbucks of stalling contract negotiations and continuously retaliating against employees engaged in labor organizing.”
Hot on the right
Ted Cruz’s 2016 Campaign Crew Is Backing DeSantis Over Trump
“As Donald Trump prepared to take the stage to accept the Republican nomination at the 2016 Republican National Convention, Texas Sen. Ted Cruz’s team fought until the bitter end to block him. Now, many of those same people are gearing up for another attempt at stopping the former president from winning the White House,” Cameron Joseph reports for Vice News.
“Jeff Roe, Cruz’s 2016 campaign manager and one of the GOP’s savviest operators, has signed on to run Never Back Down, a super PAC created to back Florida Gov. Ron DeSantis’ bid to defeat Trump for the 2024 GOP nomination. And he’s brought on many top Cruz alumni.”
Today in Washington
At 2:45 p.m., Biden will host a bilateral meeting with Argentina President Alberto Fernández.
At 5 p.m., Biden will host a reception celebrating Greek Independence Day.
Thanks for reading. See you tomorrow.