Bringing the Pain

Can sanctions hurt Putin enough to make him give up Crimea?

On Wednesday, the United States announced an initial round of sanctions in response to the situation in Ukraine, imposing a visa ban on individuals who played a part in Russia's military intervention. Advocates of economic pressure against Moscow clearly hope it's not the last round. Since the occupation of Crimea, there's been a slow rumble of calls from within and outside the Obama administration for using economic pressure to force Vladimir Putin's hand in Ukraine. Certainly, as an alternative to the use of force, sanctions have their appeal. If U.S. and European-led sanctions against Iran brought that radical regime to the negotiating table, then surely a replay could do the same for Vladimir Putin's Russia, right? The economist Anders Aslund is quite optimistic, telling the New York Times's Peter Baker that, "Russia can be forced out of Crimea with the combination of financial sanctions plus straightforward hard diplomacy."

Is he right? I know a little something about sanctions, and so, in response to popular demand, I feel obligated to weigh in on whether economic coercion will work in this instance. But you won't like my answer: even perfectly-designed economic sanctions won't eject the Russians from Crimea, and what will be implemented in the coming days and weeks will be far from perfect. But the United States should impose sanctions anyway.

The first thing to understand about sanctioning Russia over its incursion into Crimea has nothing to do with the impact of the sanctions and everything to do with what is being demanded of Moscow. The United States wants Russia to withdraw military forces from a piece of territory they have long coveted. However much Russia has contravened international law over the past week, they've changed the facts on the ground. They control Crimea, and public opinion in that autonomous republic is pretty Russo-friendly. The current status quo for Russia is that they control that territory. In world politics, there is no greater demand to ask of a government than to make de facto or de jure territorial concessions. The domestic and international ramifications of such a concession are massive -- especially after force was used to occupy the territory. So recognize that the demand being attached to the sanctions is so large that success is extremely unlikely.

The only case of economic coercion succeeding in a similar case in history was the 1956 Suez crisis. In that case, Britain, France, and Israel withdrew their forces from the Suez Canal following a U.S.-inspired run on the pound sterling. Except that the Suez case is not at all similar to Russia/Crimea. Britain was a treaty ally of the United States; not so much with Vladimir Putin's Russia. The Suez was far away from British soil; Crimea is just across the Sea of Azov. And, perhaps most importantly, Britain was in a fragile economic state trying to protect a fixed exchange rate. Russia's economy has its problems, but a shortage of hard currency reserves ain't one of them.

So the conditions under which sanctions would force Russia's hand in Ukraine are far from ideal. The proposed sanctions coalition is equally flawed, however, as my FP colleague Colum Lynch has noted. European Union leaders are not exactly keen on the idea of broad-based economic sanctions, for understandable reasons. Britain needs Russian finance capital; the rest of Europe needs Russian energy. France is traditionally the most hawkish country in Europe, but that country is too busy planning to export warships to Russia to organize European sanctions. As a result, there's been nary a peep out of Paris. If Russia continues to jerry-rig a Crimean referendum to pry it free from Ukraine, then the EU, led by its eastern members, might come around to sanctions. But that will take time -- both to organize and to take its toll on Russia -- and the more time that passes, the more that Russia can do to try and "normalize" the status quo.

The United States, on its own, has limited levers on economic influence over Russia. Financial sanctions and asset freezes sound good, part of the newfound policymaker faith in "smart sanctions" as a way squeezing a country's elite without hurting the population. It's likely that targeted financial sanctions could, if well designed, impose some costs on Russia's oligarchs and officials. But this assumes that Putin needs the support of Russia's plutocrats rather than vice versa. The past 15 years of Russian history have demonstrated that the current Russian president has little compunction with exercising state power at the expense of Russia's 1 percent. As for opening up U.S. energy exports as a way of diluting European dependence on Russian natural gas, it's not a bad idea -- it's not going to generate much pain in the short term.

Sorry, but the fact remains that sanctions will not force Russia out of Crimea. This doesn't mean that they shouldn't be imposed. Indeed, there are two excellent reasons why the United States should orchestrate and then implement as tough as set of sanctions on Russia as it can muster. First, this problem is going to crop up again. Vladimir Putin has now invaded two neighbors in six years to destabilize regimes perceived to be hostile to him. Post-Crimea, any new Ukraine government will continue to be hostile to the Russian Federation. There are other irredentist areas in the former Soviet Union -- *cough* Transnistria *cough* -- where Putin will be tempted to intervene over the next decade. At a minimum, he should be forced to factor in the cost of sanctions when calculating whether to meddle in his near abroad again. President Obama was correct to point out the "costs" to Putin for his behavior -- now he has to follow through on that pledge.

Second, while sanctions cannot solve this problem on their own, they can be part of the solution. Over the long term, Russia does need to export energy to finance its government and fuel economic growth. Even if planned sanctions won't bite in the present, the anticipation of tougher economic coercion to come is a powerful lever in international bargaining. The closer the European Union moves towards joining the U.S. sanctioning effort, the more that Russia has to start thinking about the long-term implications of its actions. Any political settlement over the future of Ukraine will require compromise by the new Ukrainian government and its supporters in the West. Imposing sanctions now creates a bargaining chip that can be conceded in the future.

After decades of policymakers deriding the utility of economic sanctions inside the Beltway, there is a newfound enthusiasm for them. As someone who has made the cause for sanctions under certain circumstances in the past, this is a welcome change. However, no one should have any illusions about what economic coercion will accomplish in Ukraine. Russia will not acquiesce on Crimea because of financial sanctions. That doesn't mean they're a bad idea.

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Do Palestinians Really Want a State of Their Own?

Not right now, they don't.

The Palestinians have all the leverage, a former top State Department specialist on the Mideast peace process recently told me over red wine in Tel Aviv. "I'm not sure they'll ever sign on the dotted line." In that moment of candor -- lubricated no doubt by the Golan Heights cabernet -- the ex-bureaucrat admitted something U.S. President Barack Obama's administration would never concede publicly: The Palestinians are under little to no pressure to sign a final peace agreement with Israel.

The consensus among right-thinking people, of course, is that self-determination is the incentive par excellence for Palestinian leaders to strike a deal. That was the view Obama articulated on Feb. 27, four days before he met with Israeli Prime Minister Benjamin Netanyahu, when he told journalist Jeffrey Goldberg that more than anything else, the Palestinians seek "the dignity of a state." Secretary of State John Kerry repeated the "dignity" talking point on March 3 at the pro-Israel policy conference of the American Israel Public Affairs Committee (AIPAC).

But if the Palestinians are desperately seeking a negotiated settlement that grants them a state of their own, they're certainly hiding it well. In July, Kerry announced an ill-advised nine-month deadline for delivering Middle East peace. That gestation period is nearly complete, but there doesn't seem to be a bun in Washington's oven. Undeterred, the administration is making a final push: Netanyahu visited the Oval Office on March 3, with Palestinian Authority President Mahmoud Abbas set to follow on March 17. If, however, Kerry and Obama are to succeed where their predecessors have all failed, they will have to fundamentally reassess their policy toward the Palestinians.

It's actually the Israelis, not the Palestinians, who are under pressure from all corners to reach a peace deal. Obama often reminds the Israelis that time is working against them, as high Palestinian birthrates could mean that the land between the Mediterranean Sea and Jordan River will have an Arab majority before long. For his part, Kerry warns Israel that the threat of boycotts and delegitimization is growing. The European Union, meanwhile, has set new guidelines against its funds going to Israeli settlements in the West Bank, and it is considering labeling goods that originate there. The United Nations has declared 2014 the "International Year of Solidarity With the Palestinian People."

The Palestinians, meanwhile, are watching from the sidelines with glee. As one Palestinian negotiator told an Israeli official during a spate of terrorist attacks a decade ago, "Victory for us is to see you suffer." Viewers of the Palestinian Authority's official television station are unceasingly reminded that the Arab-Israeli conflict is an existential, zero-sum dispute. The channel assures its audience that cities in Israel will ultimately return to Arab rule, that the murder of Israeli civilians is a heroic deed, and that Jews are "barbaric monkeys, wretched pigs" -- or in the words of putatively peace-minded Palestinian Authority official Jibril Rajoub, "Satans" and "Zionist sons of bitches." And that's not to speak of the fire-eyed theocrats of Hamas, who run the show in the Gaza Strip.

It's inconceivable that Palestinian leaders, watching Israel squirm under unprecedented international pressure, would allow the Jewish state to rehabilitate its image as peace-seeker. Instead, they recognize that after the peace talks' inevitable failure, the Jewish state will be faced with only bad options. If Israel maintains the status quo, international pressure upon it can only grow. If it unilaterally withdraws from all or part of the West Bank, it will almost certainly face the same rocket attacks that followed its last two withdrawals -- from Gaza in 2005 and from south Lebanon in 2000. This time, however, the rockets will be aimed at Tel Aviv and its international airport. The Palestinian Authority will then argue that it can't be blamed for the security breakdown, because it was not consulted in carrying out the withdrawal.

The Obama administration seems determined not to contemplate the idea that the Palestinians habitually choose Israeli occupation over independence. But we've seen this show before: In 2000, Israel offered to dismantle more than 60 settlements, withdraw from 92 percent of the West Bank and all of Gaza, share the prickliest areas of Jerusalem's Old City, and grant the Palestinians a capital in the city's eastern areas. Some 100,000 Palestinian refugees and their descendants would be allowed to move within Israel's borders. Yasser Arafat, then the Palestinians' leader, turned down the offer without making one of his own and then gave tacit or explicit sanction to the Second Intifada, an outburst of bombings and shootings that killed more than 1,000 Israelis over several years.

Between 2006 and 2008, Israeli Prime Minister Ehud Olmert met with Abbas 36 times, giving even more concessions -- offering some 95 percent of the West Bank, with swaps of land in Israel to bring the exchange to 100 percent, and a fund for Palestinian refugees and their descendants. Abbas walked away. As Olmert lamented in 2013, "I am still waiting for a phone call."

Is Abbas as toxic as Arafat, the unreformed terrorist? No. Is he Palestine's version of Egyptian President Anwar Sadat, ready to turn his sword into a ploughshare and lock hands on the White House lawn? Not a chance.

Abbas may have realized that Israel, to use Obama's words, "is not going anywhere." Sadly, he has obdurately refused to pass on the memo to his people -- in Arabic, he continues to feed them the fantasy of a wholesale "right of return" of millions of Arabs to Israel that no Israeli leader will ever allow. In 2012, he conceded to an Israeli journalist that he would return to his Galilee hometown of Safed only as a tourist -- but quickly walked back his comments after the resulting uproar. Having thus primed his people, Abbas predictably finds that there is virtually no Palestinian constituency for a realistic peace deal.

That's why Shlomo Avineri, an octogenarian Israeli peacenik and former director-general of the Israeli Foreign Ministry, can write in the dovish daily Haaretz: "Don't expect Abbas to sign anything." That's why, this week, Abbas's underlings reacted to Netanyahu's AIPAC speech -- a veritable olive branch, by his standards -- with canned outrage. Netanyahu's demand that Palestinians recognize Israel as a Jewish state, thundered Fatah Central Committee member Nabil Shaath, is "totally rejected" and "contravene[s] all the rules of the peace negotiations."

None of this is to suggest that Israel is blameless. Israel could have avoided many, though not all, of its current predicaments by not having embarked on the West Bank settlement enterprise in the first place -- at least not in areas distant from Israel proper and heavily inhabited by Palestinians. The enterprise has been damaging to Israel because it obscures the fact that Palestinians still overwhelmingly reject the Jewish state to begin with and because it gives the Palestinians a plausible pretext for endlessly deferring difficult decisions. In other words, it gives them nearly limitless leverage.

So what is to be done? The good news is that the United States does have ways to influence the Palestinians to negotiate seriously -- if only it is willing to use them. Washington is the single biggest donor to the Palestinian Authority, and thus Congress could condition U.S. aid on stopping all that monkeys-and-devils incitement (two such initiatives are currently in the first stages of legislation). The United States could also offer significant aid boosts to the Palestinians if they make tangible steps toward peace, and threaten corresponding cutbacks if they fail to do so.

Such a policy will ultimately benefit the Palestinians more than anyone. Washington, as well as the world, does them no favors in forever excusing their failure to better their lot and in painting them as a people always acted upon but never acting. The Palestinian leadership currently has no incentive to make a deal -- but in the interest of peace, that can and must change.