Republican foreign policy leaders in Congress are pressing the Biden administration to enact another wave of sanctions on Russia, including measures to ban all of Moscow’s banking institutions from accessing the international financial system.
Sixteen lawmakers led by Rep. Pat Fallon (R., Texas), a member of the House Armed Services Committee, wrote to the White House late Monday, demanding that a new wave of much tougher sanctions be slapped on Moscow, according to a copy of the letter obtained by the Washington Free Beacon.
The Biden administration must implement sanctions that would stop all Russian banking institutions from accessing SWIFT, an international financial system that most of the globe relies on to conduct transactions, the lawmakers say. Disconnecting Russia from SWIFT would effectively cut its economy off from the rest of the world and deal a massive blow to President Vladimir Putin.
“Your initial sanctions package coordinated with your G7 counterparts failed to include the removal of Russia from the Society for Worldwide Interbank Financial Telecommunication (SWIFT) system. While the second round of sanctions included actions related to SWIFT, the Central Bank of Russia (CBR), and Russia’s oligarchs, it failed to implement full blocking sanctions on the CBR, disconnect all of Russia’s banks from SWIFT, and target all of Russia’s oligarchs,” the lawmakers write. “We need strong secondary sanctions on all Russian banks, and we need the complete removal of all Russian banks from SWIFT. We cannot afford half-measured sanctions and we urge you to pursue these actions to the fullest extent possible.”
The letter comes amid a slew of calls from Republicans in the United States and other world leaders, including Ukraine’s president, to deal Russia a crippling economic blow for its unprovoked invasion of Ukraine. As Russian forces move deeper into the country and threaten to seize its capital, Kyiv, demands for another tough round of sanctions have grown louder. The letter from Fallon and his colleagues codifies many of the toughest measures that can be taken against Moscow short of war.
“If Russia wants to act like a pariah, they should be treated as such,” Fallon told the Free Beacon. “Right now, there are only two countries in the world that are completely cut off from the SWIFT electronic banking system—Russia needs to be the third. While the actions undertaken by this administration have been a step in the right direction, they are not enough. We need to financially isolate Russia from the entire world.”
Russia’s banking sector relies on SWIFT for scores of transactions, including the country’s multi-billion-dollar export of hydrocarbons, the lawmakers note in their letter. The loss of these hydrocarbon sales would reduce Russia’s GDP by at least 5 percent, according to the country’s former finance minister.
“This is exactly the type of response that would deliver a devastating blow to the Kremlin and is desperately needed,” the lawmakers write. “It is important to note the current sanctions regime allows Russian energy transactions to keep going through non-sanctioned banks that are not based in the United States. This is unacceptable, and we must instead pursue complete economic isolation for Russia.”
Disconnecting Russia from SWIFT would also stop it from performing international financial transactions, which is certain to further crush the country’s economy. It also would “trigger currency volatility, and cause massive capital outflows,” according to the Republican lawmakers.
Further sanctions must also be applied on Russia’s lucrative mineral trade, its timber sector, and its plastics and polymer industry, the lawmakers write. Russian oil and gas payments performed with other nations should additionally be placed in blocked escrow accounts, preventing Moscow from accessing the funds.
“Mr. President, this is what accountability looks like,” the lawmakers write to Biden. “Do what is necessary and project strength. Work with our European allies and send a crippling message to this autocratic regime—no more half-measures.”
Rep. Don Bacon (R., Neb.), a House Armed Services Committee member who signed onto Fallon’s letter, told the Free Beacon that these sanctions must not be delayed.
“Putin is tyrannical and bull-headed and the only way to show him that the rest of the world means business is to kick them out of SWIFT completely,” Bacon said. “While the measures taken so far by the president are good, they are not near enough. Financial isolation will make a huge impact on Russia’s already-impacted financial situation.”
Rep. María Salazar (R., Fla.), a House Foreign Affairs Committee member who signed the letter, said that Russia’s allies must also be hit with sanctions to ensure Moscow bears the full brunt of economic isolation.
“Even more important is ensuring that the Biden administration properly enforces these sanctions so the Kremlin and its western henchmen—Diaz-Canel, Ortega, and Maduro—are fully cut off from the world economy,” Salazar told the Free Beacon. “The United States has a commitment to protect freedom and democracy around the world, and with that comes an obligation to punish those who threaten it. Now is not the time for us to show weakness. Doing business with the United States is a privilege, not a right … and the United States should not do business with dictators.”
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