US Treasury Secretary Janet Yellen urged industrialized G7 economies to find a way to "unlock the value" of frozen Russian assets "to support Ukraine's continued resistance and long-term reconstruction" on February 27.
The EU, G7 nations and Australia have frozen around $300 billion in Russian assets since the start of the special military operation, with over two-thirds of that stored in the European Union.
Yellen was echoed on Wednesday by White House National Security Communications adviser John Kirby, who said: "We still need more legislative authorities from Congress for the President to be able to act on that [unlocking assets]," in a reference to the Rebuilding Economic Prosperity and Opportunity (REPO) for Ukrainians Act proposed in mid-June 2023 by a group of US lawmakers.
The REPO Act envisages confiscating assets that are directly or indirectly owned by the Russian government, the Central Bank, or the Russian Direct Investment Fund.
The Quincy Institute for Responsible Statecraft has drawn attention to the fact that Team Biden appears to have broadened the scope of the use of any "confiscated" Russian assets from benefitting Ukraine's "recovery and welfare" to the Kiev regime's "continued resistance," i.e. its military effort.
The vague focus shift occurs as the Biden administration struggles to ram the $60 billion in military assistance to Ukraine through the US Congress. House Republicans have so far opposed passing the bill amid growing Ukraine fatigue in American society.
"Converting all of the Russian assets to assistance for Ukraine could in theory fully finance a continuing war in Ukraine for years to come," writes Marcus Stanley, an advocacy director of the Quincy Institute for Responsible Statecraft. "As political support for open-ended Ukraine aid wanes in both the US and Europe, large-scale use of this financing method also holds the promise of an administrative end-run around the political system."
Moreover the renewed effort to confiscate Russia's assets to, potentially, arm Ukraine doesn't take into account the will of the US people or other G7 countries who are increasingly advocating negotiations instead of further militarization.
A February poll from the Harris Poll and the Quincy Institute indicated that roughly 70% of Americans want the Biden administration "to push Ukraine toward a negotiated peace with Russia as soon as possible."
Likewise, an EU-wide survey has recently indicated that barely 10% of Europeans believe Ukraine can defeat Russia, and consider some form of "compromise settlement" as the most likely way out.
"The new push for confiscation of Russian assets is more evidence that the US and EU intend to intensify the conflict with Moscow using administrative mechanisms that won't rely on support from the political system or the people within them," warns the QI contributor.
The effort to grab Russia's assets to support "Ukraine's resistance" also coincided with French President Emmanuel Macron's call to put NATO boots on the ground in Ukraine. It is known that Western Special Ops, spies and NATO troops and consultants have long been covertly participating in the Ukraine conflict; however, making it official and enhancing the effort would open the door to a direct conflict with Russia, international observers have warned.
Grabbing Russia's Assets Will Boomerang
Meanwhile, the very idea of confiscating Russia's frozen assets is fraught with serious risks to the Western-centered financial system, the DC-based think tank concluded.
US Senator Rand Paul released an op-ed for the QI titled "Seizing Russian assets: A feel good bill that will absolutely boomerang" on February 15.
In it, he argued that the move would be a "blunder."
"The Washington foreign policy establishment is on the precipice of making yet another strategic blunder," the senator wrote. "Confiscating Russia’s sovereign assets is an act of economic war. (…) Any hope that the United States and Russia could work toward stabilizing or improving relations will subsequently be destroyed."
Paul went on to say that Moscow had already signaled that it would retaliate "in equal measure" if its assets were confiscated, leading commentators to suggest it would seize around $300 billion in Western assets in Russia's jurisdiction.
What's more, seizing assets of a country the US is not at war with would set a "destabilizing precedent", continued the senator.
In addition, the confiscation of Russia's sovereign assets would convince other countries that the US cannot be trusted as "the guarantor of the global economy."
"[Other countries] will seek to move away from the dollar and hold their reserves in other currencies," Paul warned. "This process of de-dollarization will be an unmitigated disaster as it will degrade America’s financial strength and ensure the prosperity Americans have come to expect is no longer attainable."
According to Paul, "Three decades of repeated foreign policy disasters proves that Washington’s foreign policy establishment is badly broken."
"In a multipolar world, Washington can no longer expect to act with impunity, particularly when dealing with a nuclear power," he warned.