3.30.22
President Joe Biden has vowed to make Russian President Vladimir Putin “pay a very heavy price” for invading Ukraine. The cost thus far has included financial sanctions and possible criminal liability for war crimes, but it should not end there. If Ukraine manages to repel Putin’s army and regain its independence, it will need a massive influx of cash to recover and rebuild. And the international community should make Russia foot the bill. Following Russia’s illegal invasion, the United States has worked with foreign partners to freeze sovereign assets of the Russian government, as well as the personal offshore wealth of Putin and his aides and oligarch enablers. This hoard of riches now includes Russian central bank reserves, private bank accounts, real estate and mega-yachts scattered around the world. Collectively, these frozen assets are valued at hundreds of billions of dollars — a substantial sum that could be used to assist Ukraine. Distributing Russian assets to Ukrainians is politically untenable because it would eliminate one of the few tools the international community has to pressure Russia to call off its military offensive. Equally important, confiscating Russian assets would violate international law. Asset freezes are what international lawyers call “countermeasures” — temporary coercive acts that are designed to compel other states to comply with their international obligations. Permanently confiscating Russia’s assets, as Ustenko and Johnson propose, would constitute an illegal expropriation.
Fortunately, there is another way the United States and its partners can leverage Russia’s frozen wealth to deliver relief to Ukraine: They can refuse to unfreeze these assets until Putin pays reparations. World leaders do not appear to have considered this option. Biden and his advisers have defended international sanctions solely as measures for curbing Russian aggression. Moreover, as soon as Ukraine and Russia reach a deal to end hostilities and resolve their territorial disputes, the deterrence rationale for sanctions will evaporate. If sanctions disappear as soon as the war ends, Russia could evade meaningful accountability. Shifting the focus of international sanctions to reparations would make them more powerful. The United States and its allies should send a clear message: the more damage Russia causes in Ukraine, the more they will expect Russia to pay in reparations as a precondition for lifting sanctions. International sanctions have not deterred Putin’s army from ravaging Ukraine. But if the international community remains patient and united in defending the rule of international law, it could eventually force Putin to pay dearly for his illegal war — by compensating Ukraine with cold, hard cash.