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Putin’s Nightmare Has Arrived: Sanctions Creating “Economic Oblivion” For Russia

Russia Ukraine Donbas
Russian TOS-1 flamethrower weapon. Image Credit: Creative Commons.

Academic Claims Sanctions Have Decimated the Russian Economy – According to a paper written by Yale University’s Jeffrey Sonnenfeld and 18 co-authors, Western sanctions placed on Russia in the wake of the invasion of Ukraine are working as intended and severely damaging the Russian economy.

The paper, titled “Business Retreats and Sanctions Are Crippling the Russian Economy,” is the product of research performed by Yale University academics who used “private Russian language and unconventional data sources” which included high-frequency consumer data, cross-channel checks, and releases from Russia’s trade partners.

The authors also claim to have used “data mining” of “complex shipping data” to create “one of the first comprehensive economic analyses measuring Russian current economic activity” some five months after the invasion began.

The authors state that, as a result of Western economic sanctions on Russian financial institutions and businesses, the country’s “strategic positioning as a commodities exporter has irrevocably deteriorated.” Russia now deals from a position of weakness and still faces challenges as it adopts a “pivot to Asia” approach designed to rely less on trade with the West.

Despite some workarounds and “leakiness” in international sanctions, the paper’s authors say that Russian imports have mostly collapsed and Russia now faces major challenges in obtaining technological parts, with widespread supply shortages already hurting its domestic economy.

Self-Sufficiency Delusion

The authors also describe Putin’s promise of becoming more self-sufficient as a nation as delusional, showing how Russian domestic manufacturing has come to a total standstill with no ability to replace lost businesses, talent, and products. To top it off, the analysis reveals that Russia’s economy is now struggling with “soaring prices and consumer angst.”

Russia’s claims that oil and gas revenues are being used to withstand the effect of the economic sanctions were also shown as lies by the paper’s authors, and the paper also painted a negative picture of Russia’s future unless something changes.

“Looking ahead, there is no path out of economic oblivion for Russia as long as the allied countries remain unified in maintaining and increasing sanctions pressure against Russia, and “The Kyiv School of Economics and McFaul-Yermak Working Group have led the way in proposing additional sanctions measures,” the paper states, adding that “defeatist” headlines in the Western press about Russia’s economy bouncing back are not factual.

The Kremlin, however, has repeatedly painted a very different picture. In June, Russian President Vladimir Putin said that his nation’s economy would overcome the “reckless and insane” sanctions levied by Western states. Putin told the St. Petersburg International Economic Forum that efforts to hurt the Russian economy “didn’t work” and that Russian government authorities and businesses have worked in a “composed and professional manner” to “normalize” the economic situation.

“We stabilized the financial markets, the banking system, the trade system,” he claimed.

Jack Buckby is a British author, counter-extremism researcher, and journalist based in New York. Reporting on the U.K., Europe, and the U.S., he works to analyze and understand left-wing and right-wing radicalization, and reports on Western governments’ approaches to the pressing issues of today. His books and research papers explore these themes and propose pragmatic solutions to our increasingly polarized society.

Written By

Jack Buckby is 19FortyFive's Breaking News Editor. He is a British author, counter-extremism researcher, and journalist based in New York. Reporting on the U.K., Europe, and the U.S., he works to analyze and understand left-wing and right-wing radicalization, and reports on Western governments’ approaches to the pressing issues of today. His books and research papers explore these themes and propose pragmatic solutions to our increasingly polarized society.

4 Comments

4 Comments

  1. speedster

    July 28, 2022 at 7:52 pm

    Economic oblivion, ooops.
    There is the saying “don’t bite the hand that feeds you”. Russia sent most of its energy exports to western Europe before the latest invasion of Ukraine in February 2022.
    With efforts being made to reduce dependence on Russian energy exports,further intensified by Russia’s foolhardy intermittent reduction of energy exports, the future for Russian energy exports is looking bleak.

    What the invasion has revealed that Russia as inheritor of Soviet socialism, is not any different from the national socialism of the German nazis. The socialism of both regimes has the common characteristic of dictatorship, with the fig leaf of pretending fair shares for the workers.

  2. Scottfs

    July 29, 2022 at 4:19 pm

    I have been to Russia. It was illuminating. Outside of St. Petersburg and, especially, Moscow, Russia is poor. And I don’t mean upper New York state poor, but third world poor.

    Russia needs to stop trying to take over the world with an economy smaller than South Korea’s, and enact true market reforms and break up the oligarchs. The potential is there. Russia needs a George Washington, not Vladimir Putin.

  3. Eugene

    July 30, 2022 at 8:17 am

    OK, Google: Which currency will be the most stable in 2022? The Russian ruble has become the best world currency. In which case is the currency stable? Only when the entire economy of the country is stable. So with Jeffrey Sonnenfeld’s article, you can go straight to the toilet.

  4. Bobby

    July 30, 2022 at 8:41 pm

    Exterminate Putin and his disgusting thugs.

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