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February 01, 2018

Some Explaining to Do

Steve Mnuchin Has Some Explaining to Do

Why did the Treasury secretary sign off on a list of Russian to sanction that was ripped off from Forbes magazine?

By ANDERS ÅSLUND

A peculiarity of the Trump campaign was its extensive links with all kinds of dubious Russian contacts. Several of them were known intelligence agents, such as the bank CEO Sergei Gorkov and Paul Manafort’s righthand man, Konstantin Kilimnik. For unknown reasons, many Trump campaign operators lied about their contacts with official Russians and intelligence officers. In the end, this became so overwhelming that the Department of Justice found itself forced to appoint a special counsel, Robert Mueller.

Meanwhile, President Donald Trump repeatedly refused to acknowledge that Russia had hacked U.S. computers in connection with the elections, and even praised Russian President Vladimir Putin whenever he got an opportunity. In no way has President Trump suggested that he wanted to defend the U.S. election system against future Russian hacking.

In Congress, bipartisan worries arose that President Trump would abolish the U.S. sanctions against Russia that the United States had imposed because of Russia’s military aggression in Ukraine. Since all the U.S. sanctions against Russia had been introduced through presidential executive orders, the president could formally revoke them at any time on his own will.

Therefore, both houses of Congress voted to adopt the new Combating America’s Adversaries Through Sanctions Act (CAATSA). In the House of Representatives, only three congressmen opposed it, and in the Senate the overwhelming vote count was 98 against 2. President Donald Trump had little choice but signed it into law, and he did so on August 2—grudgingly. In a signing statement, the White House said the bill contained “a number of clearly unconstitutional provisions” that “purport to displace the president's exclusive constitutional authority to recognize foreign governments, including their territorial bounds.”

Soon, it emerged that section 241of the new law had attracted great attention in Moscow. It called on the secretary of the Treasury, in consultation with the director of national intelligence and the secretary of state, to submit within 180 days a detailed report identifying “the most significant senior foreign political figures and oligarchs” in Russia. It was supposed to be “determined by their closeness to the Russian regime and their net worth.” It should also be based on an “assessment of the relationship between individuals and President Vladimir Putin or other members of the Russian ruling elite” and an “identification of any indices of corruption with respect to those individuals.”

The obvious aim of this text was to identify those who had made their fortune on illicit contacts with the Kremlin. This anticipated report became popularly called the “Kremlin list.” The various government bodies involved clearly carried out a conscientious work on these lines. Numerous sources reported that a selective and limited list was being formed, even if uncertainties remained.

In the last week, however, somebody high up – as yet unknown – threw out the whole expert work. It could be somebody in the State Department, the Treasury or the White House. Instead of using the vetted, thoroughly researched list, this unknown political superior simply wrote down the top of the Russian presidential administration and government plus the 96 Russian billionaires on the Forbes list.

This act has numerous implications. First, by this action, this senior official ridiculed the government experts who had prepared another report. Any serious Russian who reads the published list can only conclude that U.S. intelligence is as dumb as it gets.

Second, this was supposed to be a list naming and shaming specific, odious and corrupt figures around the Kremlin. By mentioning more than 200 people, the U.S. government achieved the opposite effect—namely mocking the seemingly semi-literate readers of the Kremlin phone book and the Forbes rich list. The list includes several Kremlin critics.

Third, the clear intention of section 241, and the reason why it had attracted so much attention, was the intention to split the Russian elite and offer prominent Russians the option to live safely in the West. Many businessmen on the Forbes list are citizens of countries other than Russia and have long live abroad. By including all the wealthiest Russians, the U.S. government has instead made a major push to solidify the Russian elite behind Putin.

By signing this list, the secretary of the Treasury has caused a great deal of damage. Who will ever believe any intelligence coming from the Treasury in the future? He has mocked the U.S. sanctions on Russia and rendered CAATSA ineffective. Since the Treasury Department has issued this list, Secretary Steve Mnuchin is ultimately responsible. Why has he done something that can only benefit Putin?

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