As Russia begins war against Ukraine, the most effective tool the U.S. and allied governments are using are economic sanctions.
The U.S. and other NATO countries have already imposed economic sanctions on Russia. Tuesday’s first installment of sanctions hit members of Russian President Putin’s inner circle and their families and two banks that the U.S. considers especially crucial to the Kremlin and Russia’s military. Another new U.S. measure limits Russia’s power to raise money abroad.
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U.S. officials made clear they were holding in possible reserve more devastating measures, in case Russia escalates actions threatening Ukraine’s territory and sovereignty.
EXPLAINER: A look at toughest US sanctions facing Russia
So what are economic sanctions and why are they such a powerful tool against Russia?
What are economic sanctions?
According to the Council on Foreign Affairs, economic sanctions are defined as the withdrawal of customary trade and financial relations for foreign- and security-policy purposes. Sanctions may be comprehensive, prohibiting commercial activity with regard to an entire country, like the long-standing U.S. embargo of Cuba, or they may be targeted, blocking transactions by and with particular businesses, groups, or individuals.
In the U.S., sanctions usually come from either the executive branch or the legislative branch. Presidents, as Joe Biden did this week, use executive orders. Congress may also impose sanctions.
When are sanctions usually used?
Governments and/or international bodies, like the United Nations, have imposed sanctions “to coerce, deter, punish, or shame entities that endanger their interests or violate international norms of behavior.”
“Sanctions have been used to advance a range of foreign policy goals, including counterterrorism, counter-narcotics, nonproliferation, democracy and human rights promotion, conflict resolution, and cybersecurity,” CFR writes.
Why are they used over military force or other tools?
Sanctions are considered a form of intervention, and are viewed as a lower-cost, lower-risk action, somewhere between diplomacy and war. They are often used in situations where military action is not considered an option, or when a government doesn’t feel compelled to use military force in a situation.
Will sanctions be enough to stop Russia?
That is up for debate, of course. The U.S. and NATO allies believe imposing the harshest sanctions against Russia would help deter further war. But not everyone is on board with imposing the harshest.
In 2014, sanctions took a big toll on the Russian economy, hurting Putin’s domestic approval rating. But they did not alter Russian politics. Those sanctions, imposed when Putin invaded Ukraine for the first time, and Crimea, were more targeted.
The world has vowed tougher sanctions vs. Russia, if they invaded Ukraine. An invasion is underway.
More: Weighing Russia sanctions success tough in Ukraine conflict
Previous sanctions on Russia have been more narrowly targeted at individuals and entities, but Maria Shagina, a sanctions expert at the Finnish Institute of International Affairs, said sanctions now need to much broader to have any chance to influence Russia’s behavior. “At this point, going middle of the road is not going to deter anyone further, and at this point sanctions can play an important role in trying to deter a further invasion.”
She said full blocking sanctions on important Russian banks to cripple Russia’s financial system, and steps against oil and gas companies, were options. “If some sort of light sanctions are implemented, that is going to embolden (Putin) further. At least we have to try at this point ... to damage the economy,” she said.
“I can’t predict what sanctions can do, but the best thing is not to sit and wait to react, because this is not OK.”
The mere threat of sanctions did not deter the attack because Putin may have calculated the U.S. and Europe would stop short of the toughest measures due to Russia’s role as a key supplier of oil and natural gas, especially in Europe, Shagina said. “I think Russia didn’t, still doesn’t believe the West would impose the most nuclear options because this interdependence works as a shield for Russia.”
More: Congress backs Biden on Russia sanctions, clamors for more
(The Associated Press contributed to this report)