The United States’ inability to have any effect whatsoever on the hegemonic ambitions of Russia underscores just how vulnerable and ineffectual the U.S. has become in the last decade on the geo political stage. The apparently empty threats of visa sanctions and economic sanctions are laughable in the face of the reality that Russia has Europe in general and the Ukraine in particular at her mercy by virtue of their dependence on Russian natural gas and oil.
According to CNN, “European Union foreign ministers, meeting in Brussels, Belgium, on Monday, agreed to impose sanctions including travel bans and asset freezes on 21 officials from Russia and Ukraine, Lithuania’s foreign minister said.”
Any sanctions imposed by the NATO alliance will be met immediately and without hesitation by the suspension of energy shipments from Russia, which, given that winter is still the deciding climactic factor in the immediate future, will have an immediate impact on the willingness of Europe to enforce any US led sanctions.
Russia exports $160 billion worth of oil and gas annually, and withholding even a small portion of that will have a profound effect on the economies of Europe. Russia’s moves at this point take that into account, and so it is that Russia is free to act unilaterally toward Ukraine.
The United States position is further complicated by the $138.6 billion in US Treasurys held by Russia, which it is suspected was removed from the United States Federal Reserve custodial holdings over the weekend.
According to the report by Bloomberg,
As of December, Russia held $138.6 billion of Treasuries, making it the ninth largest country holder. Russia’s holdings are about 1 percent of the $12.3 trillion in marketable Treasuries outstanding, according to data compiled by Bloomberg.
“The timing of the drop in custody holdings makes Russia a more likely suspect,” said Marc Chandler, global head of currency strategy in New York at Brown Brothers Harriman & Co. in a telephone interview. “If Russia did it, then they may have transferred the holdings to another bank outside of the U.S.”
Russia could theoretically use its US holdings to disrupt the US Treasuries market by offering them for sale en masse, which is probably something the United States would seek to avoid at all costs.
Putin’s Popularity is ProblematicCompounding the weakness of the U.S. – Europe coalition’s ability to inflict meaningful sanctions against the Russians sufficient to induce a change of heart is the fact that Putin’s popularity both in Russia and in the Crimea have apparently skyrocketed as a result of his bold and decisive maneuvering in Ukraine.
The New York Times reported earlier today, “Last week, in the midst of the Crimean crisis and on the heels of the Sochi Olympics, Mr. Putin’s approval rating had increased to 71.6 percent, the highest point since he returned to the presidency in 2012, according to a poll released by the All-Russian Center for Public Opinion last week.”
This despite widespread crackdowns on liberal publications and journalists at home.
So despite predictable American grandstanding, the unfortunate reality is that America’s influence in the region is negligible. The chest-thumping and veiled threats emanating from the U.S. is just that.
