‘Kremlin list’ leads to slow burn
US Treasury’s count of Russian oligarchs linked to Putin has rankled Moscow, triggering a wave of denouncements
ussian President Vladimir Putin calls it a “hostile act”. A senior Kremlin official spoke of an “unprecedented act of aggression”. A Russian banker has referred to it as a “declaration of war”. So what monstrous thing has the United States done now? Is Washington targeting Moscow with nuclear missiles? Striking up an alliance with China to steal a chunk of Siberia? Poisoning Russian oil wells?
None of the above. Actually, the US Treasury Department has just issued a list. It has been informally dubbed the “Oligarch List”, and that’s exactly what it is — a catalogue of Russia’s top business tycoons, 96 in all. (Treasury officials have also included 114 senior Russian government officials.) The administration of US President Donald Trump was obligated by Congress to issue the document as part of sanctions legislation passed last summer as retaliation for Moscow’s meddling in the 2016 election. But the list itself is just a list. It doesn’t prescribe any punishments, doesn’t impose any sanctions.
So why are the Russian elites so worked up about it? While American journalists have barely paid attention to the list, the Russian media has been frantically speculating for months about who might end up in the final version. Business tycoons have been sending over high-paid lawyers to lobby US officials as part of a frantic effort to keep their names out of the list.
Ironically, given the huge fuss it has triggered in Moscow, former US State Department official Peter Harrell notes that the list wasn’t originally supposed to be such a big deal; it was intended to be more of a name-and-shame exercise. “The oligarchs have made a strategic miscalculation here,” he says. “I think people weren’t paying much attention to this report when it was passed at the end of August. The fact that oligarchs reacted so sharply to this list got both the Treasury Department and Congress a lot more interested in it.”
The tycoons are worried, he says, that being on the list “will tee them up” for a possible next round of sanctions. They’re also anxious about reputational risk — it’s possible that banks around the world will hesitate to lend to people whose names show up on the list. One recent study estimates that Russians have parked $1 trillion (Dh3.67 trillion) worth of assets in the US. The prospect that they might lose access to that wealth if the list does translate into further sanctions is clearly unnerving.
What the Russians don’t seem to be noticing, though, is the obvious unwillingness with which the Trump administration has gone about the task. When Trump signed the sanctions law last year, he did so with obvious reluctance, calling it “seriously flawed”. In advance of the list’s release, State Department spokeswoman Heather Nauert made a statement signalling that the administration has no intention of pursuing further sanctions against Moscow for the time being. The announcement earned a harsh rebuke from Representative Adam Smith (Democrat, from Washington), who accused Trump of rewarding “President Putin by inaction for his intervention in an American election”.
And when the list finally came out, Russia-watchers noted that Treasury had simply copied the names of all 96 Russian billionaires from last year’s Forbes “200 richest businessmen in Russia” list — rather than zeroing in on specific Kremlin cronies, as the sponsors of the law had originally desired.
Moderating effect
Anders Aslund, a senior fellow at the Atlantic Council, goes further. “By naming the whole Russian government, presidential administration and all Russian billionaires, the Trump administration has undermined and ridiculed the US sanctions on Russia,” he says. “This is what I feared. It looks as if President Trump has taken orders from Putin.”
If that’s the case, it doesn’t seem to have had any moderating effect on the hysterical reaction in Moscow. One reason is clear: Even in its current anodyne form, the list still offers a graphic reminder that the Putin regime is founded on systemic corruption — a fact the Kremlin recognises as a major vulnerability.
It’s a particularly sensitive topic at a moment when the Kremlin is cracking down on opposition leader and anti-corruption activist Alexei Navalny. There’s a presidential election coming up in March, and even though Putin is a shoo-in, his entourage is worried that disaffected voters will stay away in droves, undermining the legitimacy of the results. No wonder some Russian officials are denouncing the publication of the list — with astonishing chutzpah — as “election meddling”. There seems to be little sense of irony in Moscow these days. Christian Caryl is an editor with the Post’s Global Opinions section.