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Why at Least America Will Be in Another Great Depression

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America’s bailout package to overcome the coronavirus ‘recession’ is twofold:

One part is printing money for employees and consumers, so that they won’t be thrown out onto the streets for non-payment of debts such as mortgages, car-loans, credit cards, and student loans.

Another part is printing money for bondholders and stockholders, so that their investments will still have value and there won’t be panicked selling of them as corporations accumulate soaring losses because consumers are staying home and are cutting way back on expenses.

The top-down part of the bailout (the part for investors) will merely add to the wealth of the already-wealthy, while everybody else sinks financially into oblivion. (On April 9th, the Zero Hedge financial site explained in detail why even bailing out the airlines would hurt the economy more than help the economy.) The top-down part supplies the money to the corporations instead of to their employees and consumers, and is therefore supply-boosting instead of demand-boosting. Supplying money to the corporations that the Government selects to protect will enable those corporations to buy up assets and corporations which during the crisis are being auctioned off by the ones that go out of business, and this will leave the nation’s wealth in even fewer hands than before the epidemic struck.  

The bottom-up part (the part for workers and consumers) will be exactly the opposite of that: it will help prevent another Great Depression. By boosting purchases, instead of bailing-out billionaires and such, it will enable the economy to keep functioning, and it will not increase the concentration of wealth.

However, employees and consumers don’t have many lobbyists, but billionaires do, and billionaires also own (through political donations and lobbyists) almost all members of Congress (and also the mainstream press), and they not only own, but are represented by, one inside the White House, who is surrounded there by others, and by representatives of others, so that the concerns of the wealthiest will be very well represented by America’s Government, and will end up dominating the bailouts, so that only the insiders, who are well-connected in Washington, will be protected. (And Joe Biden would be no improvement over Donald Trump, though his rhetoric is different.)

Already, we see, in the ‘news’-reports, that there is ‘chaos’ etc. in the U.S. Government’s response to the crisis, but what’s not being reported in the mainstream ‘news’-media is that there very much is method to this seeming madness, and it is the method of the well-practiced and well-funded takers, definitely not of their victims, from whom they (and their Government) have been, and now increasingly are, taking. The takers own the Deep State, and are protected by it. The vast bulk of the bailouts will go to them. The vast bulk of the bailouts will go to suppliers (investors), not to their workers and consumers.

Printing money for bondholders and stockholders will predominate. It won’t be like Franklin Delano Roosevelt (FDR) did during the first Great Depression, when the federal money went to the public instead of to the megacorporations; it will be the opposite. This will be a supercharged concentration of wealth. Money is power, and the power of billionaires will thus be enormously increased; the power of the public will go to zero.

The inevitable result of this will be enormous spreading poverty, and, ultimately, so many dollars being owned by the billionaires, so that hyperinflation will result if this continues for more than a few months, and it will not be able to be overcome by any form of monetary response, because it will instead be a problem about the distribution of actual wealth (not mere money); and, as Raoul Pal phrased this problem, “Money printing does not make the dollars available. They get stuck in the financial system and hoarded” (by the wealthy), at a time like this. So: there still will be wealth, but increasing percentages of it will be owned by the super-rich; and, so, their corporations will experience plunging sales. Everything (except, perhaps, gold, etc.) will actually be worth less than it was before, even though inflation will be soaring. More dollars will be chasing fewer goods and services that are actually being purchased. The stock and bond markets will then crash. The result will be like Germany during the Weimar Republic. But the cause of it will be different; it won’t be war-reparations payments; it will instead be the almost unimaginable corruption at the very top of the U.S. Government and economy. Whereas Germany had a deeply rooted social-welfare system, America does not, and most of America’s billionaires are Republicans (unapologetically elitist psychopaths), which means they want there to be even less of that: simply dog-eat-dog (survival of the ‘fittest’) amongst everybody else — not their own class. Although Democratic politicians will probably sweep the November elections, those individuals are deeply indebted to Democratic Party billionaires, for their very careers. These billionaires must be served first — it’s the American way, “Greed is good” (at least after 1980).

One of the reasons why Weimar-era Germans gravitated politically rightward was that Germany at that time did not have a right-wing-populist Government; and, so, right-wing-populist politicians didn’t get the blame. Hitler came to power then. America now does have a right-wing-populist Government. Right-wing populism will therefore get the blame. If the leftwing-populist, democratic socialist, Bernie Sanders had been chosen by Democratic Party voters, then America would not be facing its present very dire prospects, and congressional Democrats (because their Presidential candidate would then be leading them) would now be blocking — instead of passing into law (as it now is) — the bailouts for millionaires and billionaires; but there is no such leadership, at this crucial time. (As a leader, Joe Biden is already a failure.) This is why America now faces a near certainty of another Great Depression. It comes from the leadership, and the leadership don’t represent the public.

The result when a right-wing-populist country faces collapse is a police-state, facing a revolution: military guns and tanks, facing the public. If Democrats win the November elections, then Democratic Party billionaires, and not Republican Party ones, will be making the decisions. Biden is no FDR.

Perhaps there exists no close historical precedent for understanding what the outcome of that would be. If there instead turn out to be Republican billionaires continuing to make the decisions, then there will be massive bloodshed, and increasing defections from the Government, and an increasingly unmanageable revolution, which will be a hell for any predictions. But with Democratic Party billionaires taking charge, there will be at least a possibility of fundamental reform. Perhaps someone like FDR will arise after Joe Biden’s corruption and incompetency (he won the nomination by cheating) will have been sufficiently displayed for a few years. Therefore, maybe, starting in 2024 (after Biden’s failure), things will be able to start turning around, for the better, by means of a new set of primaries for the Democratic Party’s nomination (or else by a Constitutional Amendment doing away with political parties and the Electoral College). 

The fundamental problem, right now, is that the sheer corruption at the very top of the U.S. Government will cause trillions of dollars of federal bailouts to go to the very wealthiest Americans, at a time when there is soaring need by the public. The idea that America will be able to succeed no matter how corrupt its Government is, is now being tested, and I don’t see any way that such an idea will be able to pass such a test. But only time will tell. We’re now in an enormous experiment — that’s for sure. 

There is one reason to hope that the bleak scenario described here might be averted. The most advanced software for predicting Covid-19 cases and fatalities in the United States provides projections at the “Health Data” site, which started on April 7th, by projecting that the peak in cases will be on April 15th and that by May 21st there will have been 81,000 deaths, and that by August 4th the final death will be recorded, at 81,766. Three days later, on April 10th, the projections were instead that the peak will be on April 11th and that by May 22nd there will have been 60,000 deaths, and that the final death will be recorded on August 4th, at 60,415. (But that estimate suddenly soared back up on April 13th to 68,841.) This 26% (or now 16%) reduction in the ultimate total death estimate, within only 3 (or 5) days, indicates that perhaps the outlook is less dire than has generally been thought to be the case. However, if optimistic projections turn out to be true, so that almost no Americans will die from Covid-19 after May 22nd, then the question will still remain: With tens of millions of Americans having gone for so long without income, what will be the consequence to the American economy? It will still be another Great Depression. In fact, on April 9th CNBC headlined “JPMorgan now sees economy contracting by 40% in second quarter, and unemployment reaching 20%”. (Total GDP-contraction during the Great Depression was a decline of 46% during 1929-1933, the steepest such plunge in U.S. history. Peak unemployment that was reached during the Great Depression — also a U.S. record — was 19%, in 1938.) But maybe it won’t last as long as the first one did. Furthermore, if the Government’s response to the crisis will be the opposite of what FDR’s was and will bail out the megacorporations instead of bail out only the public, what type of country will there be afterwards? That’s the problem — the insatiable and enormous grabbing by America’s super-rich, by means of their (not  our) Government. As the liberal billionaire Warren Buffett observed in November 2006, “There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning.” Now, nearly 14 years later (and especially after the current round of bailouts), we can say, simply: they won. America is a dictatorship by the rich; no longer a government “of the people, by the people, for the people.” Not only do Republican voters want to retain this dictatorship by the rich, but Joe Biden’s victory against Bernie Sanders proves that many Democratic voters also want it to continue. Sanders was the only candidate calling for “revolution,” and that call by him was spurned. That decision by the voters, which was guided by the lobbyists and news-media, which were guided by the billionaires, shapes America’s future.

Also on April 9th, the New York Times bannered “Fed’s  Plan Far Exceeds Its 2008 Rescue”. That’s  virtually unregulated money flowing to investors, unlike what will be going to workers and consumers. The Fed even “stopped short of applying limits on offshoring.” And, as the article also noted, this money that the Treasury will lend through the Fed includes “Help for corporations,” “Limited support for risky debt,” and “Help for state and city governments”; and any of these Fed loans that end up not being repaid will increase Americans’ future federal taxes. Though investors will be protected, “offshoring” of workers’ jobs will continue, and the public’s descendants will be left holding the bag of any losses.

Then, on April 13th was the announcement that “Morgan Stanley warns that a potential second wave of infections could strike around November/December”. The firm said “We believe the path to re-opening the economy is going to be long. It will require turning on and off various forms of social distancing and will only come to an end when vaccines are available, in the spring of 2021 at the earliest.” How will it then be possible to avoid a Second Great Depression? Will the Fed be able to continue printing money without limit? Would an immense financial crash be avoided even if it can? The realistic outlook now appears to be super-grim. Perhaps sooner than anyone now expects, every investor will start selling into paper investment-markets that suddenly have no buyers at anything like today’s prices.

Investigative historian Eric Zuesse is the author, most recently, of They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010

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Americas

As Refugees Flee Central America, the Mexican Public Sours On Accepting Them

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Authors: Isabel Eliassen, Alianna Casas, Timothy S. Rich*

In recent years, individuals from Central America’s Northern Triangle (El Salvador, Guatemala, and Honduras) have been forced out of their home countries by extreme poverty and gang violence. While initial expectations were that the Lopez Obrador administration would be more welcoming to migrants, policies have slowly mirrored those of his predecessor, and do not seem to have deterred refugees. COVID-19 led to a decrease in refugees arriving in Mexico, and many shelters in Mexico closed or have limited capacity due to social distancing restrictions. Now that the COVID-19 situation has changed, arrivals could increase again to the levels seen in late 2018 or 2019, with overcrowded refugee centers lacking in medical care as potential grounds for serious COVID-19 outbreaks.

Mexico increasingly shares a similar view as the US on this migration issue, seeking ways to detain or deport migrants rather than supporting or protecting them. For instance, Mexico’s National Immigration Institute has been conducting raids on freight trains to find and detain migrants. Public opinion likely shapes these policies. In the US, support for allowing migrants into the country appeared to increase slightly from 2018 to 2019, but no significant majority emerges. Meanwhile, Mexican public opinion increasingly exhibits anti-immigrant sentiments, declining considerably since 2018, with a 2019 Washington Post poll showing that 55% supported deporting Central Americans rather than providing temporary residence and a 2019 El Financiero poll finding 63% supportive of closing to border to curb migration.

New Data Shows the Mexican Public Unwelcoming

To gauge Mexican public opinion on refugees, we conducted an original web survey June 24-26 via Qualtrics, using quota sampling. We asked 625 respondents to evaluate the statement “Mexico should accept refugees fleeing from Central America” on a five-point Likert scale from strongly disagree to strongly agree. For visual clarity, we combined disagree and agree categories in the figure below.

Overall, a plurality (43.84%) opposed accepting refugees, with less than a third (30.08%) supportive. Broken down by party affiliation, we see similar results, with the largest opposition from the main conservative party PAN (52.90%) and lowest in the ruling party MORENA (41.58%). Broken down by gender, we find women slightly more supportive compared to men (32.60% vs. 27.04%), consistent with findings elsewhere and perhaps acknowledgment that women and children historically comprise a disproportionate amount of refugees. Regression analysis again finds PAN supporters to be less supportive than other respondents, although this distinction declines once controlling for gender, age, education and income, of which only age corresponded with a statistically significant decline in support. It is common for older individuals to oppose immigration due to generational changes in attitude, so this finding is not unexpected.

We also asked the question “On a 1-10 scale, with 1 being very negative and 10 very positive, how do you feel about the following countries?” Among countries listed were the sources of the Central American refugees, the three Northern Triangle countries. All three received similar average scores (Guatemala: 4.33, Honduras: 4.05, El Salvador: 4.01), higher than Venezuela (3.25), but lower than the two other countries rated (US: 7.71, China: 7.26) Yet, even after controlling for general views of the Central American countries, we find the public generally unsupportive of accepting refugees.

How Should Mexico Address the Refugee Crisis?

Towards the end of the Obama administration, aid and other efforts directed at resolving the push factors for migration in Central America, including decreasing violence and limiting corruption, appeared to have some success at reducing migration north. President Trump’s policies largely did not improve the situation, and President Biden has begun to reverse those policies and re-implement measures successful under Obama.

As discussed in a meeting between the Lopez Obrador administration and US Vice President Kamala Harris, Mexico could adopt similar aid policies, and decreasing the flow of migrants may make the Mexican public respond more positively to accepting migrants. Lopez Obrador committed to increased economic cooperation with Central America days into his term, with pledges of aid as well, but these efforts remain underdeveloped. Threats to cut aid expedite deportations only risks worsening the refugee crisis, while doing little to improve public opinion.

Increasingly, the number of family units from Guatemala and Honduras seeking asylum in Mexico, or the United States, represents a mass exodus from Central America’s Northern Triangle to flee insecurity. Combating issues such as extreme poverty and violence in Central American countries producing the mass exodus of refugees could alleviate the impact of the refugee crisis on Mexico. By alleviating the impact of the refugee crisis, refugees seeking asylum will be able to navigate immigration processes easier thus decreasing tension surrounding the influx of refugees.

Likewise, identifying the public’s security and economic concerns surrounding refugees and crafting a response should reduce opposition. A spokesperson for Vice President Harris stated that border enforcement was on the agenda during meetings with the Lopez Obrador administration, but the Mexican foreign minister reportedly stated that border security was not to be addressed at the meeting. Other than deporting migrants at a higher rate than the US, Mexico also signed an agreement with the US in June pledging money to improve opportunities for work in the Northern Triangle. Nonetheless, questions about whether this agreement will bring meaningful change remain pertinent in the light of a worsening crisis.

Our survey research shows little public interest in accepting refugees. Public sentiment is unlikely to change unless the Lopez Obrador administration finds ways to both build sympathy for the plights of refugees and address public concerns about a refugee crisis with no perceived end in sight. For example, research in the US finds public support for refugees is often higher when the emphasis is on women and children, and the Lopez Obrador administration could attempt to frame the crisis as helping specifically these groups who historically comprise most refugees. Likewise, coordinating efforts with the US and other countries may help portray to the public that the burden of refugee resettlement is being equitably shared rather than disproportionately placed on Mexico.

Facing a complex situation affecting multiple governments requires coordinated efforts and considerable resources to reach a long-term solution. Until then, the Central American refugee crisis will continue and public backlash in Mexico likely increase.

Isabel Eliassen is a 2021 Honors graduate of Western Kentucky University. She triple majored in International Affairs, Chinese, and Linguistics.

Alianna Casas is an Honors Undergraduate Researcher at Western Kentucky University, majoring in Business Economics, Political Science, and a participant in the Joint Undergraduate/Master’s Program in Applied Economics.

Timothy S. Rich is an Associate Professor of Political Science at Western Kentucky University and Director of the International Public Opinion Lab (IPOL). His research focuses on public opinion and electoral politics.

Funding for this survey was provided by the Mahurin Honors College at Western Kentucky University.

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Indictment of Trump associate threatens UAE lobbying success

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This month’s indictment of a billionaire, one-time advisor and close associate of former US President Donald J. Trump, on charges of operating as an unregistered foreign agent in the United States for the United Arab Emirates highlights the successes and pitfalls of a high-stakes Emirati effort to influence US policy.

The indictment of businessman Thomas  J. Barrack, who maintained close ties to UAE Crown Prince Mohammed bin Zayed while serving as an influential advisor in 2016 to then-presidential candidate Trump and chair of Mr. Trump’s inauguration committee once he won the 2016 election, puts at risk the UAE’s relationship with the Biden administration.

It also threatens to reduce the UAE’s return on a massive investment in lobbying and public relations that made it a darling in Washington during the last four years.

A 2019 study concluded that Emirati clients hired 20 US lobbying firms to do their bidding at a cost of US$20 million, including US$600,000 in election campaign contributions — one of the largest, if not the largest expenditure by a single state on Washington lobbying and influence peddling.

The indictment further raises the question of why the Biden administration was willing to allow legal proceedings to put at risk its relationship with one of America’s closest allies in the Middle East, one that last year opened the door to recognition of Israel by Arab and Muslim-majority states.

The UAE lobbying effort sought to position the Emirates, and at its behest, Saudi Arabia under the leadership of Crown Prince Mohammed’s counterpart, Mohammed bin Salman, at the heart of US policy, ensure that Emirati and Saudi interests were protected, and shield the two autocrats from criticism of various of their policies and abuse of human rights.

Interestingly, UAE lobbying in the United States, in contrast to France and Austria, failed to persuade the Trump administration to embrace one of the Emirates’ core policy objectives: a US crackdown on political Islam with a focus on the Muslim Brotherhood. UAE Crown Prince Mohammed views political Islam and the Brotherhood that embraces the principle of elections as an existential threat to the survival of his regime.

In one instance cited in the indictment, Mr. Barrack’s two co-defendants, a UAE national resident in the United States, Rashid Al-Malik, and Matthew Grimes, a Barrack employee, discussed days after Mr. Trump’s inauguration the possibility of persuading the new administration to designate the Muslim Brotherhood as a designated foreign terrorist organization. “This will be a huge win. If we can list them. And they deserved to be,” Mr. Al-Malik texted Mr. Grimes on 23 January 2017.

The unsuccessful push for designating the Brotherhood came three months after Mr. Barrack identified the two Prince Mohammeds in an op-ed in Fortune magazine as members of a new generation of “brilliant young leaders.” The billionaire argued that “American foreign policy must persuade these bold visionaries to lean West rather than East… By supporting their anti-terrorism platforms abroad, America enhances its anti-terrorism policies at home.”

Mr. Barrack further sought to persuade America’s new policymakers, in line with Emirati thinking, that the threat posed by political Islam emanated not only from Iran’s clerical regime and its asymmetric defence and security policies but also from the Brotherhood and Tukey’s Islamist government. He echoed Emirati promotion of Saudi Arabia after the rise of Mohammed bin Salman as the most effective bulwark against political Islam.

“It is impossible for the US to move against any hostile Islamic group anywhere in the world without Saudi support…. The confused notion that Saudi Arabia is synonymous with radical Islam is falsely based on the Western notion that ‘one size fits all,’ Mr. Barrack asserted.

The Trump administration’s refusal to exempt the Brotherhood from its embrace of Emirati policy was the likely result of differences within both the US government and the Muslim world. Analysts suggest that some in the administration feared that designating the Brotherhood would empower the more rabidly Islamophobic elements in Mr. Trump’s support base.

Administration officials also recognized that the UAE, Saudi Arabia, and Egypt constituted a minority, albeit a powerful minority, in the Muslim world that was on the warpath against the Brotherhood.

Elsewhere, Brotherhood affiliates were part of the political structure by either participating in government or constituting part of the legal opposition in countries like Kuwait, Iraq, Yemen, Bahrain, Morocco, Jordan, and Indonesia.

The affiliates have at times supported US policies or worked closely with US allies like in the case of Yemen’s Al Islah that is aligned with Saudi-backed forces.

In contrast to UAE efforts to ensure that the Brotherhood is crushed at the risk of fueling Islamophobia, Nahdlatul Ulama, one of, if not the world’s largest Muslim organization which shares the Emirates’ rejection of political Islam and the Brotherhood, has opted to fight the Brotherhood’s local Indonesian affiliate politically within a democratic framework rather than by resorting to coercive tactics.

Nahdlatul Ulama prides itself on having significantly diminished the prospects of Indonesia’s Brotherhood affiliate, the Prosperous Justice Party (PKS), since the 2009 presidential election. The group at the time successfully drove a wedge between then-President Susilo Yudhoyono, and the PKS, his coalition partner since the 2004 election that brought him to power. In doing so, it persuaded Mr. Yudhoyono to reject a PKS candidate as vice president in the second term of his presidency.

Nahdlatul Ulama’s manoeuvring included the publication of a book asserting that the PKS had not shed its links to militancy. The party has since failed to win even half of its peak 38 seats in parliament garnered in the 2004 election.

“Publication of ‘The Illusion of an Islamic State: The Expansion of Transnational Islamist Movements to Indonesia’ had a considerable impact on domestic policy. It primarily contributed to neutralizing one candidate’s bid for vice president in the 2009 national election campaign, who had ties to the Muslim Brotherhood,” said militancy expert Magnus Ranstorp.

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Biden Revises US Sanctions Policy

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Official White House Photo by Adam Schultz

In the United States, a revision of the sanctions policy is in full swing. Joe Biden’s administration strives to make sanctions instruments more effective in achieving his political goals and, at the same time, reducing political and economic costs. The coordination of restrictive measures with allies is also seen as an important task. Biden is cautiously but consistently abandoning the sanctions paradigm that emerged during Donald Trump’s presidency.

The US sanctions policy under Trump was characterised by several elements. First, Washington applied them quite harshly. In all key areas (China, Iran, Russia, Venezuela, etc.), the United States used economic and financial restrictions without hesitation, and sometimes in unprecedented volumes. Of course, the Trump administration acted rationally and rigidity was not an end in itself. In a number of episodes, the American authorities acted prudently (for example, regarding sanctions on Russian sovereign debt in 2019). The Trump-led executives stifled excess Congressional enthusiasm for “draconian sanctions” against Russia and even some initiatives against China. However, the harshness of other measures sometimes shocked allies and opponents alike. These include the 6 April 2014 sanctions against a group of Russian businessmen and their assets, or bans on some Chinese telecommunications services in the United States, or sanctions blocking the International Criminal Court.

Second, Trump clearly ignored the views of US allies. The unilateral withdrawal from the nuclear deal with Iran in 2018 forced European businesses to leave Iran, resulting in losses. Even some of the nation’s closest allies were annoyed. Another irritant was the tenacity with which Trump (with Congressional backing) threw a wrench in the wheels of the Nord Stream 2 pipeline project. Despite the complicated relations between Moscow and the European Union, the latter defended the right to independently determine what was in its interests and what was not.

Third, concerns about sanctions have emerged among American business as well. Fears have grown in financial circles that the excessive use of sanctions will provoke the unnecessary politicisation of the global financial system. In the short term, a radical decline in the global role of the dollar is hardly possible. But political risks are forcing many governments to seriously consider it. Both rivals (Moscow and Beijing) and allies (Brussels) have begun to implement corresponding plans. Trade sanctions against China have affected a number of US companies in the telecommunications and high-tech sectors.

Finally, on some issues, the Trump administration has been inconsistent or simply made mistakes. For example, Trump enthusiastically criticised China for human rights violations, supporting relevant legislative initiatives. But at the same time, it almost closed its eyes to the events in Belarus in 2020. Congress was also extremely unhappy with the delay in the reaction on the “Navalny case” in Russia. As for mistakes, the past administration missed the moment for humanitarian exemptions for sanctions regimes in connection with the COVID-19 epidemic. Even cosmetic indulgences could have won points for US “soft power”. Instead, the US Treasury has published a list of pre-existing exceptions.

The preconditions for a revision of the sanctions policy arose even before Joe Biden came to power. First of all, a lot of analytical work was done by American think tanks—nongovernmental research centers. They provided a completely sober and unbiased analysis of bothха! achievements and mistakes. In addition, the US Government Accountability Office has done serious work; in 2019 it prepared two reports for Congress on the institutions of the American sanctions policy. However, Joe Biden’s victory in the presidential election significantly accelerated the revision of the sanctions instruments. Both the ideological preferences of the Democrats (for example, the emphasis on human rights) and the political experience of Biden himself played a role.

The new guidelines for the US sanctions policy can be summarised as follows. First, the development of targeted sanctions and a more serious analysis of their economic costs for American business, as well as business from allied and partner countries. Second, closer coordination with allies. Here, Biden has already sent a number of encouraging signals by introducing temporary sanctions exemptions on Nord Stream 2. Although a number of Russian organisations and ships were included in the US sanctions lists, Nord Stream 2 itself and its leadership were not affected. Third, we are talking about closer attention to the subject of human rights. Biden has already reacted with sanctions both to the “Navalny case” and to the situation in Belarus. Human rights will be an irritant in relations with China. Fourth, the administration is working towards overturning Trump’s most controversial decisions. The 2020 decrees on Chinese telecoms were cancelled, the decree on sanctions against the International Criminal Court was cancelled, the decree on Chinese military-industrial companies was modified; negotiations are also underway with Iran.

The US Treasury, one of the key US sanctions agencies, will also undergo personnel updates. Elisabeth Rosenberg, a prominent sanctions expert who previously worked at the Center for a New American Security, may take the post of Assistant Treasury Secretary. She will oversee the subject of sanctions. Thus, the principle of “revolving doors”, which is familiar to Americans, is being implemented, when the civil service is replenished with personnel from the expert community and business, and then “returns” them back.

At the same time, the revision of the sanctions policy by the new administration cannot be called a revolution. The institutional arrangement will remain unchanged. It is a combination of the functions of various departments—the Treasury, the Department of Trade, the Department of Justice, the State Department, etc. The experience of their interagency coordination has accumulated over the years. The system worked flawlessly both under Trump and under his predecessors. Rather, it will be about changing the political directives.

For Russia, the revision is unlikely to bring radical changes. A withdrawal from the carpet bombing of Russian business, such as the incident on 6 April 2018 hint that good news can be considered a possibility. However, the legal mechanisms of sanctions against Russia will continue to operate. The emphasis on human rights will lead to an increase in sanctions against government structures. Against this background, regular political crises are possible in relations between the two countries.

From our partner RIAC

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