Kevin Hassett at National Review has a simple plan to bring Russia and its ally Belarus to their knees.
If the Iranian sanctions are simply copied this time around, the harm to the Russian economy would rival anything that might be done with active war. In 2012, Iranian GDP was about $700 billion, enough money to fund a nuclear program and all sorts of terrorism across the Middle East. In 2020, when Trump left office, Iranian GDP had dropped all the way to $189 billion. Today’s supply chain problems in the U.S. are a walk in the park compared with what Iran was experiencing as President Biden took office.Belarus is clearly complicit in the attack on Ukraine, and a model client state for the Russians. Accordingly, the actions the U.S. and its allies take against Russia for the invasion should extend to Belarus as a signal to other countries to avoid allying themselves too closely to Putin. Before digging into the details, consider the impact on these societies of similarly effective sanctions. Russian GDP in 2021 was about $1.7 trillion dollars, while the GDP of Belarus was a measly $60 billion. If we impose on Russia the same sanctions that Iran experienced, that would drop Russian GDP to $459 billion. Per capita GDP for Russians would shrink from about $11,000 to $2,970.Since Russia and Iran are oil-based economies with significant agrarian production, it is not out of the question that Russian sanctions could have a similar effect. But the sanctions against Iran devised by the Trump administration were significantly more stringent than anything being discussed today for Russia. In 2018, when Trump withdrew from the Obama nuclear deal, the steps taken against Tehran had a remarkably simple approach. Any firm or country caught doing business with Iran forfeited its right to do business with the U.S. While a few waivers were issued to help oil refineries that depended on Iranian oil find other suppliers, the move stopped Iranian supply chains in their tracks. Brent-crude exports dropped from about 2.5 million barrels a day to a couple of hundred thousand.The academic literature on sanctions suggests that they tend to lose their effectiveness over time as profiteers find convoluted ways to get products to the sanctioned country. But the Trump administration was dogged in its pursuit of Iran. It enforced its sanctions in multiple ways. Ship traffic was monitored, and tankers or container ships headed for Iran from foreign ports were warned away. Companies that dodged the sanctions were treated harshly. People forget today, but when Ren Zhengfei, the daughter of Huawei’s founder, was arrested in Vancouver, the issue at stake was her violation of U.S. sanctions against Iran. Similarly, scores of other companies were pursued. British bank Standard Chartered forfeited, in 2019, $240 million dollars, and was fined another $480 million for violating sanctions. The list goes on and on....