Among the insights from the Pandora Papers leak is that sanctions against hostile state actors and enablers work--a hotly contested point in international relations. The Pandora Papers provide abundant evidence that sanctions inflict a high cost on the targets of those sanctions. In an article in The Washington Post, Greg Miller writes,
"Over the past seven years, the United States and Europe have imposed sanctions on more than 800 Russian individuals and entities for alleged “malign” behavior including Russia’s annexation of Crimea, armed incursions into Ukraine, attempted assassinations of political dissidents, cyberattacks on Western institutions and disruptions of U.S. elections.
"The Pandora files show sanctions not only hitting their Russian targets but then triggering losses that spread across their interconnected financial networks.
...“The impact of such measures can be severe. Treasury designations all but lock targets out of global markets, where the U.S. dollar is the dominant currency, and bar U.S. banks and companies from doing business with them.”
In other words, sanctions do what they are meant to do, unquestionably inflict a significant cost on their targets, even though they do not prevent hostile acts. Miller writes,
"But the files also underscore the limits of sanctions, making clear that vast quantities of Russian money continue to slosh through secret global accounts while Moscow’s actions beyond its borders seem undeterred. Russia remains in control of Crimea, a prominent critic of Putin was poisoned last year, and U.S. intelligence agencies accused Moscow of mounting a new attack on a U.S. presidential election."
However, short of removing hostile actors from their positions of power by force, the U.S. and the West can use sanctions to influence--if not ultimately stop--hostile acts from reoccurring. Miller, again,
"Current and former U.S. officials said the losses and reactions depicted in the documents demonstrate the reach of the West’s financial arsenal. The officials said these punitive measures influence the Kremlin’s calculations if not always change its course."
Or, as Miller quotes Julia Friedlander,
“What it shows is that these networks don’t feel untouchable,” said Julia Friedlander, who served in senior positions at the Treasury Department and the White House during the Obama and Trump administrations. “Although sanctions have often failed to deliver on larger political goals,” she said, they disrupt adversaries who “rely on our financial markets as an element of their own power.”
For a description of the Pandora Papers leak and what the leak is revealing, go to ICIJ.org.
