Beating U.S. Sanctions Has Always Been Child’s Play for Russia

In April 2022, I taught a seminar in financial warfare at the U.S. Army War College in Carlisle, Pennsylvania. My class consisted of 12 hand-picked mid-career military officers and civilians from the Army, Navy, Marines, Air Force, CIA, and State Department being trained in advanced strategic arts to prepare them for future roles at the highest levels in the Pentagon and White House.

This was just over a month after the Russian invasion of Ukraine. The U.S. was imposing financial sanctions on Russia of unprecedented scope and severity. I told the class bluntly that the sanctions would fail, they would not affect Russian behavior, that the U.S. would be the big economic loser from the sanctions, and that sanctions were easy to avoid.

I encountered a lot of skepticism from the class, which is fine because seminars are intended to provoke different views and constructive disagreement. Still, I was right on all counts.

The Russians are winning the ground war. (Don’t believe what you read in the NY Times and Washington Post; they’re full of lies promoted by the CIA and State Department). The Russian economy is projected to grow faster than the U.S. economy in 2023.

The U.S. plan was to deplete Russia militarily. Instead, Russian industry is on a war footing producing over 1,000 modern tanks per year, while the U.S. is being depleted and is struggling just to get a handful of Abrams tanks delivered to Ukraine before the end of this year. The Russian ruble at 80.22 per dollar is almost exactly where it was when the war began, despite Biden’s vow to “destroy the ruble.”

This article offers a primer on how easy it is to evade sanctions. It describes how China, Turkey, and India have all remained neutral on Russian sanctions and have greatly increased their imports of Russian oil.

That’s good news for Russia, but the story does not stop there. These countries have been buying more than they need and re-exporting the oil to the EU, Australia, and other G7 nations. The exports are both crude oil and refined products such as gasoline and kerosene (jet fuel).

In effect, these nations are “laundering” the Russian oil through their refineries and sending the distilled products to eager buyers, including those supposedly sanctioning Russia.

This is one of hundreds of such schemes that are easily employed. The bottom line is that U.S. sanctions are a joke. The only ones who don’t get it are the U.S. Treasury, the Pentagon, and the White House.

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