US Economic Sanctions Against Russia Brings In Germany
The most recent US economic sanctions against Russia has angered our ally Germany. The planned new US sanctions are set to hit German and European companies which have business interests in Russia. The German Economy Minister Brigitte Zypries asked the European Commission to consider countermeasures against the United States for increasing sanctions against Russia that would potentially hit European companies.
Germany said something I told viewers yesterday. The US sanctions against Russia are illegal. The US Congress doesn’t care about legalities. It was illegal for John McCain, Lindsey Graham, and other globalist congressmen to use tax payers money to overthrow the elected government of Ukraine. You think Congress cares about legalities? Congress considers themselves the “law makers” and so the law is what they say it is. That’s why even the SEC can’t touch Congress members for illegal insider trading that private citizens would have gone to jail over.
German Economic Minister Brigitte Zypries told a German newspaper, “We consider this to be a violation of international law. The Americans cannot punish German companies because they operate economically in another country. There are (partnerships) for natural gas and petroleum pipelines (in the region).”
Germany and much of the EU are heavily dependent on Russian natural gas, and German companies working on gas pipelines fear they could be hit with US sanctions because of Congress’ latest move.
Economic Sanctions Against Russia
Sanctions against Russia for defending itself in Ukraine against US based NGOs is misguided policy that will ultimately push Russia into a tighter alliance with China, Syria, Iran, and North Korea.
On July 21, 2017, the White House announced that President Trump will sign into law a bill on the latest set of sanctions against Russia, Iran and North Korea. Congress forced Trump’s hand because of the overwhelming support of sanctions against Russia. Congress passed the Russian sanctions bill with a veto-proof majority of 419-3 in the House and 98-to-2 in the Senate. President Trump needs to delay signing this law and instead take his case to the American people that it’s Congress, and not his Administration, that is on the marching path towards war with Russia.
Did the President make a deal with the devil to get Establishment globalists to leave his family alone in exchange for signing these sanctions against Russia? The timing seems suspect that Democrats would end the Senate Russia investigation right as new sanctions against Russia are passed.
President Putin has not given up on President Trump entirely but the New York Times writes that the way this is playing out in Russia is that US sanctions against Russia are a gift to Mr. Putin.
President Trump has an awesome opening now to take a leadership role in bringing about better relations with Russia by rejecting the new sanctions imposed against Russia by Congress.
These increased sanctions are so dumb and were not really thought out carefully. The problem is that the US has only limited trade with Russia in the first place because of previous sanctions. So to have any meaningful effect on Russia, US sanctions can’t target Russia directly but instead must target Russia’s trading partners like Germany.
Targeting German energy importers is another stupid move by Congress that could be dangerous as the EU doesn’t have any good alternatives to trade with Russia. Obviously Germany will move to protect their trade interests, irrespective of America’s wishes.
Are Sanctions Hurting Russia?
In 2015, sanctions pushed Russia’s economy into a recession with a negative GDP growth of -2.2% for the first quarter of 2015, as compared to the first quarter of 2014. Sanctions on access to financing have forced Russia to use part of its foreign exchange reserves to prop up the economy.
How do you explain to the people of Russia why the US is targeting them and putting them out of work simply because Russia defended itself against US NGOs which toppled the government of Ukraine? The optics are horrible.
Sure the latest round of sanctions imposed by Congress will hurt Russia but they will also hurt many other countries and hence our relationship with many of our allies.
Dmitri Abzalov writes in his analytical article for Russia’s online newspaper Gazeta.ru:
“Their [EU] investment share varies from 30 percent to 70 percent depending on each particular project. A possible cut off in financing will mean a serious blow to European business.”
The Blue Stream natural gas pipeline is a target of the new sanctions by Congress. Blue Stream is a major Black Sea gas pipeline that carries natural gas from Turkey to Russia. The pipeline is being constructed by a joint venture between Russia’s Gazprom and Italy’s Eni.
The new sanctions also will impact the expansion of Sakhalin-2, Russia’s LNG plant which is operated in a partnership between Japan’s Mitsubishi and Mitsui, Gazprom, and Royal Dutch Shell. Another target could be the Baltic Liquefied Natural Gas project, which is also operated by Gazprom and Royal Dutch Shell.
The sanctions also will impact the Nord Stream-2 project expansion into Germany making Germany an energy hub. If the project stops because of new US sanctions, Germany will have to give up on its dream of becoming an energy superpower as it will not be allowed to sell natural gas to Eastern Europe.
Of course the US, who is imposing these sanctions, are telling the EU that we have natural gas they can purchase. However, if the EU opts for American gas, the cost of production in Europe will increase considerably, which will be passed on in the cost of manufactured products. Germans will then be at a competitive disadvantage to cheaper goods manufactured in the US.
What about Japan? Japan has already agreed to invest in Russia’s Kuril Islands, what will it do now?
An interesting side note about the effectiveness of sanctions against Russia. When sanctions were imposed on Russia in 2015, it crashed the country’s currency which gave Russian wheat a price advantage over US wheat. The weakening Ruble allowed Russia to become the world’s #1 exporter of wheat last year. US wheat farmers were not too happy about that.
Current Sanctions On Russia
US sanctions currently against Russia specifically target Russia’s energy sector, which makes up more than half of the country’s Gross Domestic Product. No U.S. oil company can do business with Russia, nor can any companies sell drilling technology needed to access oil and gas reserves.
U.S. banks cannot issue long-term loans to Russian businesses for energy-focused projects.
European banks are also prohibited from engaging in similar financing arrangements with Russia. The European Union has also sanctioned Moscow which has pushed Russian companies to borrow money from Beijing. Beijing has become the biggest lender to Russian companies.
All of this is designed to weaken a key sector of Russia’s economy in hopes the pressure will entice Putin, over time, to reverse his annexation of Crimea and to withdraw Russian troops and its support of rebels in eastern Ukraine.
The US State.gov website shows the current sanctions against Russia:
Executive Order 13660, signed on March 6, 2014, authorizes sanctions on individuals and entities responsible for violating the sovereignty and territorial integrity of Ukraine, or for stealing the assets of the Ukrainian people. These sanctions put in place restrictions on the travel of certain individuals and officials and showed our continued efforts to impose a cost on Russia and those responsible for the situation in Crimea.
Executive Order 13685 was also issued. Utilizing these Executive Orders, the United States has steadily increased the diplomatic and financial costs of Russia’s aggressive actions towards Ukraine. We have designated a number of Russian and Ukrainian entities, including 14 defense companies and individuals in Putin’s inner circle, as well as imposed targeted sanctions limiting certain financing to six of Russia’s largest banks and four energy companies.
These actions, in close coordination with our EU and international partners, send a strong message to the Russian government that there are consequences for their actions that threaten the sovereignty and territorial integrity of Ukraine. The United States, together with international partners, will continue to stand by the Ukrainian government until Russia abides by its international obligations. The United States is prepared to take additional steps to impose further political and economic costs. A secure Ukraine, integrated with Europe and enjoying good relations with all its neighbors, is in the interests of the United States, Europe, and Russia.
With Germany asking the EU to use countermeasure sanctions against the US for what it deems as illegal sanctions, a whole new level of potential conflicts and countries re-examining their relationships with the US is taking place.
The mess that we are currently in can be traced back to the Obama Administration, John McCain, and other Congress members working with George Soros to destabilize and overthrow the elected government of Ukraine.
Think of what is happening like a game of Chess. When you make a wrong move, your game slowly falls apart as every move after that initial wrong move cascades into a loss.
That’s what happens when you do something wrong. People take sides against you.
The only way out of this mess is for the US to admit it was wrong to overthrow the elected leader of Ukraine and to apologize to the people of Ukraine and Russia and to end all sanctions immediately.
What good is it that President Trump didn’t take lobbyists money in his run for the White House, if he’s constantly being manipulated by Congress who is controlled by lobbyists money? President Trump can take a leadership role in fighting against big oil and natural gas lobbyists in Congress by doing everything in his power to walk back sanctions against Russia and to improve relations with the country before it’s too late.
Putin has retaliated against the US by kicking out 755 US diplomats from Russia. Putin finally showed a crack in his maneuvering with is an opportunity for President Trump to push into that crack and take a leadership role in improving relations with Russia before it’s too late.
I was raised in the “nuclear family” as many of you were. I remember how life was under the Cold War and the constant threat of a nuclear war with Russia. Anybody actually living through that time should be fighting hard to prevent backsliding into another Cold War and nuclear arms race with Russia.
Do you have any thoughts on Germany asking the EU to use counter-sanctions against us? Leave your comments below.
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