Follow us on social

Seizing Russian assets: A feel good bill that will absolutely boomerang

Seizing Russian assets: A feel good bill that will absolutely boomerang

A Senate measure under consideration would breed contempt and prolong the war in Ukraine

Analysis | Europe

The Washington foreign policy establishment is on the precipice of making yet another strategic blunder.

The Senate is poised to ram through the Rebuilding Economic Prosperity and Opportunity (REPO) for Ukrainians Act. This legislation will provide the president the authority to confiscate Russia’s frozen sovereign assets in the United States and transfer them to Ukraine for its reconstruction.

Confiscating Russia’s sovereign assets is an act of economic war. Seizing and transferring these assets to Ukraine may make Washington feel virtuous, but it will not bring peace. Passage of this bill will only reinforce the view of hardliners in Moscow that Russia’s war lies not just with Ukraine, but really with the United States and the West. Any hope that the United States and Russia could work toward stabilizing or improving relations will subsequently be destroyed.

There is no justification for Russia’s invasion of Ukraine, but enacting this bill will make peace less likely. Ukrainians have courageously defended their country for nearly two years, but even Ukraine’s former top military commander General Valery Zaluzhny admits the war is now a stalemate.

Russia’s frozen assets could be used as a bargaining chip during negotiations, but once Congress provides the president the authority to seize Russian assets, there will be immense political pressure on him to carry out the policy to avoid looking weak. President Biden was recently pilloried by the media and members of my party for returning frozen Iranian assets in exchange for five American hostages. He is unlikely to make that decision again.

Confiscation will only convince Moscow that there is no negotiated settlement to be had with Ukraine. The result will be a destroyed Ukraine. More Ukrainian soldiers and civilians will die, and more cities and towns will be turned to rubble.

History is replete with examples of economic warfare turning into violent hostilities. Many historians believe the U.S. embargo of 1807, which was intended to punish France and England for their aggressions at sea, led to the War of 1812. Likewise, FDR’s decision to freeze Japan’s sovereign assets and implement an embargo on oil and gasoline exports led to Tokyo’s decision to attack Pearl Harbor.

The past teaches us the folly of embracing every proposed act of revenge. U.S. senators are duty-bound to ask whether our actions will ensure American security and prosperity. In regard to the REPO Act, the Russians already answered that question for us. Moscow says they will retaliate in kind against the United States and our allies, with some estimates claiming upward of $288 billion in Western assets that Moscow could confiscate.

Nicholas Mulder, an assistant professor of history at Cornell University, highlights the danger of the “destabilizing precedent that western countries would set by seizing assets to end a war they are not openly involved in.” Professor Mulder states that such an action “would broaden the coercive actions that states could take for disputes to which they are not a direct party.”

Confiscating Russia’s assets will also certainly convince other countries, including China, that the United States can no longer be trusted as the guarantor of the global economy. They will seek to move away from the dollar and hold their reserves in other currencies. This process of de-dollarization will be an unmitigated disaster as it will degrade America’s financial strength and ensure the prosperity Americans have come to expect is no longer attainable.

In addition, this bill will hand the Russians another tool to fuel resentment against the United States. American leaders speak of a “rules-based international order” but the theory that the United States can confiscate the assets of another country we are not at war with is legally dubious.

Professor Mulder argues that “economic reprisals are the prerogative of injured states, not of third parties.” Rather than compel respect for international law, our actions will demonstrate to our adversaries that we are flouting it. This bill will be used by the Kremlin to show the world that while Washington demands that others follow the rules, we are happy to break them whenever we see fit.

In a multipolar world, Washington can no longer expect to act with impunity, particularly when dealing with a nuclear power. We understood the serious dangers our country faced during the Cold War. But three decades of repeated foreign policy disasters proves that Washington’s foreign policy establishment is badly broken.

A good way to start on the road to fixing that broken foreign policy is rejecting this disastrous bill.

Wonder AI

Analysis | Europe
Russia, China dump the dollar as Moscow announces new trade corridors

Russian President Vladimir Putin and Chinese President Xi Jinping in Beijing, China, in 2016. (Muhammad Aamir Sumsum/ Shutterstock)

Russia, China dump the dollar as Moscow announces new trade corridors

QiOSK

Russia announced this week that its bilateral trade with China has almost completely moved away from using the U.S. dollar, highlighting the two countries’ commitment to reducing their reliance on the U.S.-led economic system.

Aside from reducing dependency on the Western-dominated global currency, these ‘de-dollarization’ efforts allow Russia and China to avoid the myriad sanctions now preventing Moscow from doing business on the international market.

keep readingShow less
Israel can still drag the US into war with Iran

Protesters hold a banner calling on U.S President Joe Biden not to trust Israeli Prime Minister Benjamin Netanyahu during a demonstration. REUTERS

Israel can still drag the US into war with Iran

Middle East

The Biden administration is breathing a sigh of relief that it has so far avoided a wider regional war between Israel and Iran. But that self-congratulation should be tempered with realization that it was a close call and that the incentives for Israeli Prime Minister Benjamin Netanyahu and his hawkish governing coalition to provoke one are still present.

The Biden administration’s rhetorical outrage at Iran’s forewarned and well-choreographed symbolic missile and drone attacks on Israeli territory conflicts was absurd, as was its crowing that Israel, with U.S. and allied help, had already “won” by knocking down almost all the sequenced projectiles. American policy has long been so “in the bag” for its Israeli ally, no matter what its behavior, that such silly kabuki has been normalized.

keep readingShow less
Erdogan lands in Iraq for much-hyped visit

Iraqi Prime Minister Mohammed Shia al-Sudani and Turkish President Recep Tayyip Erdogan attend a welcoming ceremony at Baghdad International Airport in Baghdad, Iraq, on April 22, 2024. REUTERS/Thaier Al-Sudani

Erdogan lands in Iraq for much-hyped visit

QiOSK

Turkish President Recep Tayyip Erdogan visited Iraq Monday for the first time since 2011, marking a potential thaw in relations between the two neighboring countries, which have long clashed over Turkish attacks on Kurdish groups in Iraq’s north.

“For the first time, we find that there is a real desire on the part of each country to move toward solutions,” Iraqi Prime Minister Muhammad Shia’ al-Sudani said during a recent event at the Atlantic Council in Washington, D.C.

keep readingShow less

Israel-Gaza Crisis

Latest