Paul Craig Roberts

I am being asked if the issuance by the dreadful Biden regime of a new package of sanctions against Russian oil exports are a gift to the incoming Trump presidency or a poisoned chalice. My answer is neither. The sanctions, if the incoming Trump regime leaves them in place, are a poisoned chalice for the American consumer and for America’s European allies or puppets. If the sanctions succeed, reducing the world’s supply of oil in the market will drive up prices. The demand for oil is inelastic with respect to price. A higher price of oil will increase Russian oil renevues and hurt everyone else.

In Germany industry is already leaving to locate in countries with less costly energy. This will leave Germans unemployed. American commute times mean that higher energy prices cut into discretionary income and consumer spending, reducing the outlook for growth and profits. For Russia it means a higher oil revenues. If I were in charge in Russia, I would not sell energy to enemies conducting war against Russia. Russia can finance its domestic developments without foreign exchange. Michael Hudson and I have explained this many times. We are amazed that Putin tolerates the incompetence or worse of his central bank director, whose 21% interest rates are a worse threat to Russia than NATO, American sanctions, and the remnants of the Ukrainian army.

The Russians can deliver oil wherever they wish to whomever they wish. The last thing they need is insurance on oil tankers. Russia can accompany the oil tanker with warships or submarines, or more cheaply with targeting information ready to release hypersonic missiles on any threat.

One has to wonder why the Biden idiots punish Americans and Washington’s allies? Gilbert Doctorow attributes the idiocy to defective information, or disinformation, fed to the administration and Congress by the CIA. I think Doctorow is correct. I once had an inside look at the CIA’s decision making and it was ridiculous, a product of morons.

The sanctions imposed on Russia, including sanctions on personal yachts and even personally on Russian President Putin reek of childishness, not of a great power. Ukraine is of no strategic importance to anyone but Russia. Yeltsin’s government was stupid or well bribed to agree to Ukraine being broken off from Russia. Regardless, Ukraine is not our problem. It is Russia’s, and Washington should stay clear of the problem. Instead, Washington seems intent on bringing us to major war.

Doctorow makes the point that if the Kremlin regards the new sanctions as a threat, the effect of the sanctions will be to cause Russia to escalate the war to victory before the sanctions can have any effect. In effect, the stupid Biden regime’s sanctions will prompt Putin to get off his butt, stop his delaying tactics and get the war over.

Let us take a look at sanctions. I can understand how Washington might get away with telling a country that they cannot sell to or buy from the US. I don’t know if this violation of contracts is legal. I assume that “national security,” one of the greatest lies in the Western world, justifies anything. I don’t understand how Washington can tell France, for example, and the rest of the world that they cannot sell to or buy from other countries. Moreover, if Washington does, why does anyone pay any attention to Washington? The world’s passive acceptance of Washington’s dictums is extraordinary. What if the world’s governments told Washington that Americans cannot sell or buy anything from us? It is amazing that Russia and China sell strategic minerals to the US.

A country that keeps its central bank reserves in US Treasuries risks the confiscation of the securities by Washington, leaving the country without reserves. This is what Russia’s central bank director did to Russia. Another cost of US sanctions was imposed on the French bank, Paribas, which had to pay $1.1 billion to Washington to continue its operations in the US for the penalty of financing a French government contract with Russia.

But a country does not have to keep its reserves in dollar-denominated US Treasuries or do business in the US. A country can put its sovereignty first. A sensible central bank would sell the US Treasuries and purchase gold, stored domestically and not with the US Federal Reserve where it can be confiscated. Today anyone who trusts an asset in America is a fool.

The indications are that Washington intends to break up BRICS with sanctions. To succeed in this endeavor requires the BRICS to passively accept the sanctions. In other words, obeying Washington is what the world is accustomed to do. They do it without thinking. The world hasn’t learned to stand up for itself.

But it is easy. All the countries of the world need to do is to tell Washington that they reject Washington’s control over to whom they can sell and purchase, and that the US cannot sell or purchase from them. In other words, it is child’s play to isolate Washington and leave the US sinking. This prospect has never occurred to the American foreign policy “experts,” or to Washington’s victims who so willingly summit themselves to domination, or to Putin and Xi who are so determined to avoid confrontation.

Why do governments submit themselves to Washington’s control? My suspicion is that Washington owns the governments. As I was told in the Pentagon by a high ranking presidential official, “We give foreign government officials bags of money. We own them. They report to us.”

Perhaps Putin should use the increase in oil revenues to rival Washington in the payoff of foreign governments. At the present time, Washington is, with Israel, the only payer.

As long as governments belongs to Washington, the outcome is predictable.

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The Folly and Illegality of Sanctions
https://www.paulcraigroberts.org/2025/01/13/the-folly-and-illegality-of-sanctions/