This scenario repeats itself regularly. In March, it declared that it was “seriously considering” imposing extensive banking sanctions and tariffs.
At the end of August, he threatened again that if the Kremlin leader did not agree to a ceasefire, he would wage an “economic war” against him that would be “bad for Russia.”
And most recently, on Monday, a few days before the incident in Poland, he told reporters that he was ready to move on to the second phase of sanctions against Russia, which he had so far avoided in the interests of negotiations.
Russian drones in the airspace of a NATO member (the entire incident has not yet been fully clarified) increase the pressure on Trump to make good on his threats in this context.
However, the question arises as to whether the US still has any leverage with which to exert pressure on Russia. And whether its use would not lead to global chaos.
Trump's options are limited
Although the Republican president has repeatedly threatened an “economic war,” he does not have many cards he can play to cause significant damage to the Kremlin.
This is because America trades with Russia only to a limited extent. And even before the war, the volumes involved were not staggering. While trade with the European Union amounted to around one trillion dollars last year, the US traded goods and services worth a meager 5 billion dollars with Russia. That is roughly the same as with Slovakia. Before the war, American trade with Russia was about seven times as large, which is also not much.
The overseas power cannot therefore decouple itself from Russian energy sources or other goods in order to prevent the Kremlin from filling its war chest. Nor are there many goods whose direct export to Russia it could stop.
Trump's strongest weapon is the dollar. So far, the United States has only blocked a few Russian banks [one of the last significant financial institutions was Gazprombank, editor's note], which still allows Russia to hoard dollar foreign exchange and finance the import of goods from abroad (traders usually want payments in dollars).
According to the American think tank Council on Foreign Relations, a complete financial embargo would make it much more difficult to import goods from third countries to Moscow. If the US were to disconnect the entire Russian banking sector from the American financial system, this would make it much more difficult for the country to access hard currencies. Trump could also impose sanctions on Russia's largest exporters, including state-owned energy companies, which would make access to dollars or euros even more difficult.
However, Russia already trades extensively with China in yuan and with India in rupees. And although the measures mentioned have the potential to harm trade with other smaller countries, the solution lies in payments in rubles or another relatively trustworthy non-Western currency (Chinese). This trend is already a reality, but would likely intensify, prompting the Global South to once again turn away from the dollar and seek alternatives.
The other options Trump has up his sleeve are either more vague or significantly riskier.
For example, he could tighten export controls and restrict what can be exported to Russia, or tighten the screws on American banks and insurance companies to make them scrutinize all transactions related to Russia more closely.
He can cause the most damage via third countries
However, the advantage of the United States is that it is a world power, both militarily and economically. A power that does not have to impose sanctions itself, but urges the rest of the world to do so. And has gradually decoupled itself from Russia.
Washington could, for example, demand that those who buy oil from the land of the bear only pay the Russians for the goods into special bank accounts at local banks. This money would then be frozen and could only be used for permissible transactions.
Of course, this would require the cooperation of the banking sectors in third countries. However, the Americans could enforce this by threatening financial institutions with exclusion from the American financial system.
However, Trump does not have to limit himself to individual companies. He can also exert direct pressure on foreign governments to stop buying oil from the Kremlin or to stop exporting goods to Russia.
He has already done something similar with India. He did so using his favorite tool, tariffs (25 percent), which he imposed on Indian imports into the US because the country continues to buy black gold from Russia.
Even if individual countries do not want an economic war with the United States and prefer to stay on good terms with Trump, powers such as China and India already have enough power to retaliate for such moves. And thus their dispute with the US is destroying international trade and plunging the world into chaos.
The American bull in a china shop is not very popular, even with his own allies, due to his tariff policy and his unpredictable nature and views. He has more talent for dividing than uniting.
If it decided to crack the whip on Putin, tighten sanctions policy, and severely punish China, India, and other developing countries that have no problem trading with Russia, it could expect nothing less than these countries moving further and further away from the West. And that Americans could suffer from the retaliatory measures.
