Russian President Vladimir Putin is continuing his smorgasbord of destabilizing activities in Western countries. The United States and European Union implemented economic sanctions that were supposed to humble and hobble him. But they appear to have only enraged and emboldened him.
No doubt this is because, for nearly 20 years, Putin has lorded over a mercantile kleptocracy. It is predicated on him and a small group of oligarchs extracting wealth from Russia and investing/laundering it abroad. This means that they are practically inured to (broad) economic sanctions, which leave ordinary, innocent Russians to suffer the impact, disproportionately.
But even I underestimated the extent to which Putin and his cronies are inured. Here, for example, is the hopeful way I wrote about this in “Fail, Putin! Only (More) Sanctions to Show for Cyberattacks on US Election,” July 31, 2017.
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US sanctions are not just crippling Russia’s economy; they are cramping the jet-set lifestyle of the oligarchs he depends on to protect and sustain his kleptocracy.
It speaks volumes that the richest Russians, including Putin himself, have more money in American banks than Russian ones. And US officials can make sanctions more targeted by requiring them to account for their ‘unexplained wealth.’ For this would prove every bit as incriminating as requiring drug lords to account for theirs. This is why Putin and his oligarchs are so susceptible to US sanctions.
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To be fair, I clearly thought the sanctions should be more targeted – not just to be more effective, but also to limit the disproportionate impact I referenced above. As it happens, I had cause to reinforce this point earlier this year after Putin ordered yet another hit on UK soil; namely the attempted assassination of ex Russian spy Sergei Skripal and his daughter Yulia:
Here’s to UK Prime Minister Theresa May making quite a show of targeting Russian oligarchs like Roman Abramovich, whose prized assets include the famous Chelsea Football Club. Because, trust me, these oligarchs would rather fund a palace coup against Putin than lose access to their billions in ill-gotten gains or, worse still, be forced to live permanently in Russia.
Not to mention that this would do much to belie prevailing claims that London has become My Beautiful Laundrette for money launderers of all stripes – from business oligarchs to political despots and drug kingpins.
(“Russia Taunting Britain with Brazen Assassinations,” The iPINIONS Journal, March 13, 2018)
This is why I was so heartened when this latest hit proved too brazen even for the Trump administration:
The Trump administration is unleashing additional sanctions against seven Russian oligarchs with ties to President Vladimir Putin along with 12 companies they own or control. …
The punitive actions are the latest escalating step by the US to punish Putin’s inner circle for interfering in the 2016 election and other ongoing aggressions across the globe in Crimea, Ukraine and Syria.
(CNN, April 6, 2018)
It took the May administration a little more time, but it is following suit with an even more targeted strategy:
The UK has yet to renew a visa for Roman Abramovich, the Russian oligarch and owner of Chelsea football club, after it expired last month. …
London-based Mr Abramovich [shocked government officials and business associates alike when he] left the UK [bound for Russia] after his investor visa expired.
(Financial Times, May 20, 2018)
And, lest you think oligarchs sensible enough to avoid getting stuck in Russia would escape this fate:
Downing Street confirmed it was looking at individuals who were still in the UK and holding tier 1 visas [like Abramovich’s], which allow anyone who invests more than £2m in the British economy to stay for 40 months. …
Applications can be rejected if officials believe the applicant is not in control of funds, money has been obtained unlawfully, or the origin of funds means granting a visa will not be conducive to the public good.
(The Guardian, May 21, 2018)
In other words, just as I suggested, Russian oligarchs now have some ‘splainin’ to do. And I hasten to point out that a disproportionate number of them just happen to be based in the UK.
Rachel Davies, head of advocacy at Transparency International, says the group has found £4.4 billion worth of UK property that is owned with suspicious wealth, a fifth of it owned by Russian individuals.
(The Irish Times, March 24, 2018)
Fatefully, this gives May’s Britain considerable asymmetrical power over Putin’s Russia. Nothing betrays this quite like the Kremlin’s whining, trolling response to this new crackdown:
Russia accused the UK of treating its oligarchs ‘dishonestly.’ … Russian business executives face ‘various manifestations of unfair and unfriendly treatment,’ said Dmitry Peskov, a spokesman for Vladimir Putin, the president.
(Financial Times, May 21, 2018)
Talk about “gaslighting” …
Incidentally, targeting Abramovich is doubly strategic because he is Putin’s most-favored oligarch. Therefore, this hits as close to home as any strategy could without targeting Putin himself.
What’s more, all Western-based oligarchs must be pondering
- Whether it’s better to stand with Putin (in Moscow) and lose not just their coveted Western lifestyles but access to billions laundered through Western banks and vested in Western properties?
- Whether it’s better to betray Putin (in London), cop a plea, and risk ending up on the growing list of dead Russians who dared to do so?
Talk about “the rub” …
But no group is more deserving of this dilemma than these oligarchs. It is their inevitable day of reckoning for the Faustian bargain they struck with Putin at the expense of the long-suffering Russian people. Collectively, the billions they ripped off make the billions Bernie Madoff made off with seem like petty theft.
Which leads me to end with this pithy take on the venal and menacing nature of Putin’s Russia:
Every country has its own mafia. In Russia, the mafia has its own country.
(The Huffington Post, May 21, 2018)
This is what renowned chess grandmaster and Russian dissident Garry Kasparov said at a recent PutinCon-style conference in New York City. And yes, he fears his days are numbered.
But this take, which he’s been sharing lately, echoes what I’ve been sharing for years in commentaries like “Putin Reforming Russia in His Own Image,” March 25, 2005, “Hail Putin, Again,” September 26, 2011, and “In Putin’s Russia Even Athletics Is a Criminal (Doping) Enterprise,” November 9, 2015.
Related commentaries:
fail Putin sanctions…
Skripal assassinations…
Reforming Russia…
Corruption in Russia…
Hail Putin…
Madoff…
Putin’s Russia…