WEBVTT 00:00.344 --> 00:04.720 JUDY WOODRUFF: And for more on the potential impact of these new sanctions, as well as the 00:04.720 --> 00:09.720 broader U.S. and European response to Russia's moves, Nick Schifrin is back with two views. 00:10.560 --> 00:13.280 NICK SCHIFRIN: Judy, thank you. 00:13.280 --> 00:15.920 For additional perspective, we turned to Stephen Hadley, 00:15.920 --> 00:19.360 national security adviser during the George W. Bush administration, 00:19.360 --> 00:23.840 and Andrew Weiss, who served in the George H.W. Bush and Clinton administrations 00:23.840 --> 00:28.560 on the National Security Council staff and the State Department's Policy Planning Staff. 00:28.560 --> 00:30.800 Welcome, both of you, back to the "NewsHour." 00:30.800 --> 00:33.280 So, we just heard from the deputy Treasury secretary. 00:33.280 --> 00:37.200 Andrew Weiss, let me start with you. Do these Russian banks have exposure to the 00:37.200 --> 00:42.200 U.S. financial system? And does targeting Russian oligarchs and sovereign debt have any impact? 00:43.840 --> 00:44.480 ANDREW WEISS, Carnegie Endowment for International Peace: Well, 00:44.480 --> 00:48.240 let's talk about what Vladimir Putin uses to fund his economy. 00:48.240 --> 00:53.240 He sells raw materials on global markets for dollars. So, every day, Russia sells four million 00:54.560 --> 00:59.560 barrels of oil. Oil right now is fluctuating around $100 a barrel. That is a remarkable 01:00.000 --> 01:05.000 cash flow that Putin is able to harness for whatever purpose. And money is always fungible. 01:05.520 --> 01:10.520 Since the crisis in 2014, the Russian economy, broadly speaking, has taken 01:11.600 --> 01:16.600 the reliance it once had on foreign capital markets and basically tossed it aside. So, 01:16.880 --> 01:21.200 the Russian economy today is increasingly cut off from the global economy, 01:21.200 --> 01:25.440 and far less dependent on Western capital markets to fund itself. 01:25.440 --> 01:29.120 It is clear that putting sanctions on well-connected people 01:29.120 --> 01:33.040 in the Russian (AUDIO GAP) is annoying and frustrating to them. 01:33.040 --> 01:38.040 But, remember, there are very hawkish figures around Vladimir Putin who actually benefit. 01:38.640 --> 01:43.360 The less Russia is globalized, the less it's connected, that gives them more control. 01:43.360 --> 01:46.480 And so, if you think about who's sitting in the war room right now 01:46.480 --> 01:50.240 with Vladimir Putin, it's not people who are thinking about their 401(k) accounts. 01:50.240 --> 01:52.240 NICK SCHIFRIN: 01:52.240 --> 01:57.240 Steve Hadley, let me get you to respond to not only the U.S. announcements of sanctions today, 01:57.760 --> 02:02.760 but the German, the British and the German announcements largely coming at the same time. 02:03.360 --> 02:07.040 STEPHEN HADLEY, Former U.S. National Security Adviser: Well, I think it's a good step. 02:07.040 --> 02:12.000 I'm afraid my own view is that it's not going to be enough to deter Vladimir Putin. 02:12.880 --> 02:17.680 He didn't bring 100,000 -- over 150,000 troops to the border of 02:17.680 --> 02:22.680 Ukraine to settle for putting peacekeepers in these two breakaway provinces, if you will. 02:25.760 --> 02:30.240 And I think how it's going to unfold is something like this. He has said he's 02:30.240 --> 02:35.240 recognized an area that is broader than just the territory occupied by his proxy forces, 02:36.960 --> 02:41.960 but it includes territory occupied by Ukrainian forces. And I think it could go in two ways. 02:43.600 --> 02:48.480 Russia either tells the Ukrainians to get out of that territory who are protected by 02:48.480 --> 02:53.480 Russian peacekeepers. Russian proxies move on Ukrainian forces. And, at that point, 02:55.120 --> 02:59.520 Ukraine will have to either back down or choose to fight. And if it chooses to fight, 02:59.520 --> 03:04.520 that would be an excuse that Putin could use to move these 150,000-plus forces into Ukraine. 03:07.120 --> 03:11.360 That's the scenario I worry about. And I don't think the sanctions today, 03:11.360 --> 03:13.840 regrettably, will deter him from doing so. 03:13.840 --> 03:18.320 NICK SCHIFRIN: So, Andrew Weiss, let me ask you about those scenarios in a minute. 03:18.320 --> 03:23.320 But let me just ask you first about Germany. How significant is it that Germany pulled, 03:23.920 --> 03:26.160 frankly, one of the most significant cards it has, 03:26.800 --> 03:31.800 which is to essentially cancel the Nord Stream 2 pipeline, the German-Russian pipeline that was 03:33.440 --> 03:37.280 suspended, but still could have gone forward had they not made that announcement today? 03:37.280 --> 03:40.560 ANDREW WEISS: I think the Western world really owes 03:40.560 --> 03:44.000 German Chancellor Schroeder (sic) a debt for taking this move today. 03:44.000 --> 03:48.720 And it's really the most important move of all the sanctions that were announced. It's good to see 03:48.720 --> 03:53.040 Western governments, including the White House, moving swiftly and responding to the outrageous 03:53.040 --> 03:58.040 things that Vladimir Putin said and did yesterday. So all of that's welcome. They show that they can 03:58.320 --> 04:03.320 move quickly. And, clearly, we're only seeing a down payment on a sanctions package that, 04:03.360 --> 04:07.600 as the crisis gets worse, is going to get broader and more far-reaching. 04:07.600 --> 04:12.560 So the administration is looking to the Germans to basically make sure that the 04:12.560 --> 04:17.040 European Union comes in alongside the United States. The United States' sanctions, I think, 04:17.040 --> 04:21.840 will be more far-reaching and more significant than what European partners are prepared to do. 04:22.400 --> 04:27.360 But particularly when it comes to Vladimir Putin's sense that the Germans are the soft spot, 04:27.360 --> 04:30.880 I think that that's been dispelled today by what the Germans have done 04:30.880 --> 04:35.880 by basically putting this pipeline project on indefinite suspension. 04:36.160 --> 04:40.720 NICK SCHIFRIN: Steve Hadley, let ask you about that idea of further U.S. sanctions. 04:40.720 --> 04:45.720 The U.S. is withholding some sanctions, most notably, the idea of 04:45.920 --> 04:49.520 export controls that would cut off U.S. technology 04:49.520 --> 04:54.520 that Russia needs. Is that the right thing to do in order to try and deter Putin? 04:55.840 --> 04:58.400 STEPHEN HADLEY: I think they have got the right approach, 04:58.400 --> 05:03.400 to have a portion of their ultimate sanctions package now, hold something in 05:04.480 --> 05:09.040 reserve if, as I fear, Putin does something bigger in Ukraine. 05:09.040 --> 05:13.200 I think the other thing, though, they need to think about and I'm sure are thinking about 05:13.200 --> 05:18.200 of whether they should do further reinforcements of our NATO allies that now find themselves on 05:18.800 --> 05:23.800 the front line with Russia and, again, the pace and the nature of the kind of 05:24.480 --> 05:28.560 supply that they are providing to Ukraine for their military forces 05:28.560 --> 05:33.560 to give them and put them in a position to resist a more massive Russian incursion. 05:33.600 --> 05:37.825 I'm sure the administration is thinking about both of those things. 05:37.825 --> 05:41.680 NICK SCHIFRIN: Andrew Weiss, the U.S. has indicated that it's unlikely to sanction 05:41.680 --> 05:45.680 Russian oil exports, those exports that you brought up at the beginning, 05:45.680 --> 05:50.000 that give Putin such an economic cushion right now. Is that a mistake? 05:50.000 --> 05:52.560 ANDREW WEISS: I don't think so. 05:52.560 --> 05:56.720 The challenge here whenever you're coming up with a sanctions regime is 05:56.720 --> 05:59.840 to remember that you want to hurt the other guy more than you hurt yourself. 05:59.840 --> 06:02.800 And we heard Secretary Adeyemo talk in those terms just now. 06:03.360 --> 06:08.360 The challenge is, is that the Russian economy is built around a system where they 06:09.760 --> 06:14.760 bring in their revenues in dollars, and then their domestic liabilities are denominated in rubles. 06:16.320 --> 06:21.320 In 2014, Russia did not have a free-floating exchange rate, and they blew through some of their 06:21.520 --> 06:26.320 currency reserves trying to defend their currency. They're not going to make that mistake, this time. 06:26.320 --> 06:30.880 They basically have salted away on the order of $630 billion in 06:31.440 --> 06:35.120 various hard currencies to deal with rainy day situations. 06:35.120 --> 06:40.120 And they're not going to basically use that to defend a currency rate that isn't tenable. 06:41.920 --> 06:45.840 What they will do, though, is, they will tighten their belts. They will use their 06:47.120 --> 06:50.400 receipts from selling various commodities on global markets to 06:50.960 --> 06:54.480 bolster the regime and to make sure that the people who matter the most, 06:54.480 --> 06:58.560 particularly people in the military and the security services, have what they need. 06:58.560 --> 07:02.320 It's the average Russian consumer who's going to be squeezed. And they have done this in 07:02.320 --> 07:07.320 previous cycles, where they basically said to Joe Six-Pack in Russia, sorry, you're going to 07:07.920 --> 07:12.920 lose out. So Russians are getting used to a crummy economic reality. They have had multiple years of 07:13.440 --> 07:18.320 declines in real incomes for average people. And the Russian government basically doesn't care. 07:18.320 --> 07:22.960 So we're seeing that divide between ruler and ruled widen in Russia. It 07:22.960 --> 07:26.960 poses a long-term challenge for Putin. But, at the moment, there's nothing on the political 07:26.960 --> 07:30.560 landscape that makes him uncomfortable or makes him worried about his hold on power. 07:30.560 --> 07:34.640 NICK SCHIFRIN: Steve Hadley, take us back to those assessments that 07:34.640 --> 07:38.000 you were laying at the beginning and zoom out for us a little bit. 07:38.000 --> 07:43.000 You have been in the national security space since the mid-'70s. How dangerous 07:43.760 --> 07:48.760 is this moment? How concerned should we all be about some kind of conflict in Ukraine spreading? 07:49.600 --> 07:54.600 STEPHEN HADLEY: I think it's a very dangerous moment. And we should be concerned. 07:56.560 --> 08:01.560 I think, if the Russians do what we fear that they are going to, do in terms of taking a 08:02.880 --> 08:07.880 good chunk of Ukraine, recognizing what they want to do is to have a pro-Russian government 08:08.640 --> 08:13.640 in Kyiv that will put Ukraine under the Russians' sphere of influence, and maybe except some kind 08:15.680 --> 08:20.680 of confederation between Belarus, Russia, and Ukraine, that's really what Putin is about. 08:21.280 --> 08:25.360 It's the restoration of the Russian empire. If he moves in that direction, 08:25.360 --> 08:30.360 the question is, what does it mean if you are in the Baltic states, if you're in 08:30.560 --> 08:35.560 Romania or you're in Bulgaria? For example, one of the questions that will be on the table is, 08:36.720 --> 08:41.720 there is a portion, as you know, of Russia that is disconnected from Russia. It is 08:42.000 --> 08:45.280 separated from mother Russia, if you will, by Poland and Lithuania. 08:46.720 --> 08:51.720 And the question is, does Russia bulldoze the corridor, to kayak up Kaliningrad, 08:52.400 --> 08:57.280 with the rest of Russia? That -- it means taking territory from the Baltic states, 08:57.280 --> 09:01.680 from Poland. That invokes Article 5 of NATO. That invokes war. 09:01.680 --> 09:06.680 So we have a serious situation in Europe. And I would say, at the same 09:07.040 --> 09:11.760 time we try to manage this deteriorating situation in Europe, we have got the 09:11.760 --> 09:16.080 challenge of China, and we also have the challenge of Iran in the Middle East. 09:16.080 --> 09:21.080 This is a huge agenda for America, raising a real risk of overstretch. 09:22.560 --> 09:25.920 And we're going to need a lot of friends and allies and help from others if we're 09:25.920 --> 09:29.600 going to manage what I think is going to be a very challenging time going forward. 09:29.600 --> 09:34.600 NICK SCHIFRIN: Stephen Hadley, Andrew Weiss, thanks to you both. 09:35.840 --> 09:40.840 STEPHEN HADLEY: Nice to be with you.