WASHINGTON — The United States and its allies are pushing for sanctions aimed at forcing Vladimir Putin to spend Russia’s money to prop up his economy, rather than retain his “war machine” for fighting in Ukraine. A top Treasury Department official said on Tuesday.
Deputy Treasury Secretary Wally Ademo, one of the chief US coordinators on the Russian sanctions strategy, said in an interview with The Associated Press that the goal is to make Russia “less able to project power into the future”.
On the same day that inflation recorded its biggest increase in decades, Adeyemo said reducing supply chain backlogs and managing the pandemic were key to easing rising prices, which he related to the ongoing land war in Ukraine. , which has contributed to rising energy costs.
“Let’s be clear that the increase in energy prices was caused by President Putin’s aggression, and we will continue to see volatility in those markets as long as President Putin continues his illegitimate invasion of Ukraine,” he said. He added that the Biden administration is “committed to doing everything we can to reduce the cost of energy for the American people.”
2 to Treasury Secretary Janet Yellen, Adamo is tasked with developing a sanctions strategy, which many economists have equated to an economic war with Russia. He is leading the Treasury’s efforts to rebuild the US economy with equities at the forefront of the pandemic.
Adeyemo discussed the next steps the US and its allies would take to inflict the financial pain on Russia – and the complications of the war at the rising cost of driving Americans back home.
The US and its allies will next target the supply chains that contribute to the creation of Russia’s war machine, Adeymo said, which “includes everything from looking at ways to go after military equipment that is not only available for use in Ukraine.” but to project power elsewhere.”
“The practical meaning of this is that with less money, Russia will have less money to invest in its military,” he said.
Adamo said Putin has recently acknowledged that the Russian economy has to change. Adeyemo interpreted this to mean that “the Russian economy is less resilient, it is smaller, it is less able to project power into the future.”
Adeyemo’s work includes coordinating with US allies to develop thousands of unprecedented sanctions on Russia’s leadership and its central bank, aimed at crippling the country’s financial system.
Germany in particular faces international pressure to curb its trading ties with Russia, which provides natural gas to the European superpower.
“Our German counterpart and my European counterpart are working in general as much as possible to create a plan to exit Russian energy as quickly as possible, including last week’s announcement that they will be working on Russian coal in the near term. going to ban.” , “And our hope is that they’re going to take these steps.”
In the US, the economy has proved a struggle for the Biden administration as the past year’s strong job gains also produced the worst inflation in more than four decades.
The Labor Department reported Tuesday that prices climbed 8.5% in March from a year earlier, the sharpest increase since December 1981. While inflation began to rise before Russia invaded Ukraine, the war has affected oil and gasoline supplies. Half of last month’s increase in consumer prices came from gas.
That economic instability is a challenge to other tasks that Adeyemo has been assigned to the Treasury — leading a similar pandemic-related economic recovery through the Office of the Treasury’s recovery program, which marks its one-year anniversary this week. Is.
Adeyemo said he recently visited Memphis to see how the city is using US rescue plan dollars to help people pay their rent. Overall, he said, “we’ve seen that 80% apply to low-income households, 40% to African American households, and 20% to Latinx households.”
He said it is imperative that the remaining relief funds under the program be used to help small businesses, including the State Small Business Loan Initiative, which allows states to increase access to credit for small businesses.
“Many communities are looking at ways to use the money not only to address the immediate crisis, but how they can better build their communities in the future to ensure that people have economic opportunities. are,” he said.
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Associated Press writer Josh Bok contributed to this report.
