Sanctions mainly drive innovation

Editor's note: Between what's been called the "deep state," the "breakaway civilization," a "parallel system of finance," the "Nazi international," "Zionism," and the "Fourth Reich" operating in the US, one has to ask what the U.S. Treasury thinks it's accomplishing by placing economic sanctions on other countries — Russia most of all — as a weapon of economic warfare. Sanctions on Russia haven't stopped its oil trade; they've simply pushed it into shadowier channels. Reports on Greek shipowners who sold hundreds of aging tankers at inflated prices to buyers in the UAE, China, Turkey, and India have documented the emergence of hundreds of new, often opaque shipping firms tied to Russian oil. The core argument is simple: nations and businesses act in their own self-interest, so Greek sellers, Asian buyers, and Gulf middlemen will keep trading regardless of what Washington wants. Russia has essentially demonstrated that the U.S. can no longer dictate the terms of global trade. The conclusion follows: sanctions mainly drive innovation in evasion, not the outcomes they were designed to achieve. Unless sanctions were cleverly designed specifically to allow for Russia to develop its fully domestic Il-114-300 turboprop airliner, you have to consider the view that sanctions are not working. The conclusion: sanctions mainly drive innovation in evasion rather than achieving their intended goals. Russia just demonstrated sanctions create new markets...

Editor's note: Despite years of Western sanctions aimed at "crippling Russia's economy", a Russian payment network called A7 has emerged as a strikingly effective workaround. The company says it now handles nearly 20% of Russia's foreign-trade payments, or more than $100 billion a year, using a combination of conventional banking and cryptocurrency. Backed by Russia's state-owned PSB bank and publicly embraced by President Vladimir Putin, A7's executives envision a global financial network outside the reach of Washington, SWIFT and Brussels. The network is majority-owned by Ilan Shor, a Moldovan businessman convicted of bank fraud, and operates through affiliated firms in Kyrgyzstan, Hong Kong, and the UAE, settling roughly two-thirds of its payments in Chinese yuan rather than dollars. It has already opened offices in Nigeria and Zimbabwe and is exploring expansion into Latin America and the Middle East. The U.S., U.K., and EU have all sanctioned A7 directly, yet the network has continued expanding and advertises its ability to operate despite Western restrictions. Few examples illustrate the sanctions regime's core weakness as clearly: A7's broader significance is its ambition to turn sanctions evasion into permanent financial infrastructure.

Russia's Hottest Startup Is a State-Backed Sanctions Evasion Network

Russia has also engineered and built the epitome of icebreakers now plowing threw the Arctic: