Asked last week how the United States would stop something that is under German control, Biden only replied, “I promise you we can.”
In Congress, Republicans and Democrats – in a rare agreement – have long opposed Nord Stream for the leverage it gives Russia over Europe. They have been divided for months on whether to impose sanctions on Nord Stream 2 now or only if Russia invades.
The United States and its allies have several other options to punish Putin for an escape.
Targeting Putin’s Circle
One of the tactics most used by the United States is to sanction the immediate circles of the leaders, their families and the military and civilian circles. Putin, his friends and family could also face it, as well as Russia’s powerful business oligarchs and its banks.
Sweeping legislation by Indiana Republican Rep. Jim Banks, co-sponsored by nearly 40 other House Republicans, would stack the penalties ahead of even any new Russian invasion of Ukraine, ranging from cutting off Moscow from the international banking sector to Nord Stream sanctions.
They would also urge consideration of targeting many in Russia’s upper echelon with sanctions.
This includes Putin’s family and a woman believed to be Putin’s romantic interest, Alina Kabaeva, who won Olympic gold in 2004 in rhythmic gymnastics.
For the United States and its European allies, excluding Russia from the SWIFT (Society for Worldwide Interbank Financial Telecommunication) system, which transfers money from one bank to another around the world, would be one of the financial measures the toughest they could take, damaging the Russian economy. immediately and in the long term. The move could cut Russia off from most international financial transactions, including international profits from oil and gas production, which together account for more than 40% of the country’s revenue.
But kicking Russia out of SWIFT would also hurt other economies, including those of the United States and key ally Germany.
The United States could prevent Russia from accessing the American dollar.
US dollar transactions are ultimately cleared by the Federal Reserve or US financial institutions. For Putin, this means that foreign banks must be able to access the American financial system to settle transactions in dollars.
The ability to block this access gives the United States the ability to inflict financial hardship far beyond its borders.
Unlike the SWIFT option and other financial measures, this is one the United States could do on its own.
The United States is considering imposing export controls, which could cut Russia off from the high-tech that helps fighter jets and airliners fly and powers smartphones.
This would mean that Russia’s ability to obtain integrated circuits and products containing integrated circuits would be severely restricted, due to the global dominance of US software, technology and equipment.
US export restrictions could motivate companies to seek alternatives in other countries, including China.
At least one Russian bank has reportedly started stockpiling crucial technology.
The Biden administration has already limited Russia’s ability to borrow money by banning US financial institutions from buying Russian government bonds directly from public institutions last year.