New US sanctions, announced last Friday by the Trump administration, target seven Russian oligarchs, 12 Russian companies, and 17 state officials. The news reportedly cost companies controlled by aluminum tycoon Oleg Deripaska more than $6 billion in market value in the first two days of trading following the announcement. That’s a lot of pain, even for a man who can afford it.
Devil’s advocate: If the point is to pressure those closest to Putin to push the Russian president toward better behavior, it’s not going to work. Russia’s vertical power structure ensures the wealthy and well-connected depend almost entirely on Putin for their wealth and connections. In times of hardship, they depend even more on his good will. Far from making Putin a liability for those around him, sanctions reinforce his importance for them. In fact, the Russian government has already stepped in with financial help for Deripaska’s Rusal, the country’s lead aluminum producer. Impose these penalties to punish aggression, but don’t expect them to upend Putin any more than they’ve destabilized the Castros and Kims.