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Monday's letter from the House successfully pressured the President to sign the long-awaited second round of CBW sanctions on Russia for the Skripal poisoning, but Trump seems to have chosen the weaker options and it could be diluted further with waivers. nytimes.com/2019/08/01/us/…
As background, because Moscow didn't promise and allow verification that it would stop using such weapons, the Chemical and Biological Weapons (CBW) Act requires the President to choose at least 3 of the 6 options below. It turns out that Trump chose to impose THE FIRST THREE:
(1) no multilateral loans, (2) no US bank loans nor credit provision to the Russian govt except for food, (3) no exports to Russia of goods/technology, (4) no imports from Russia of goods, (5) downgrade or suspend diplomatic relations, & (6) no Russian airlines to land in the US.
Let's consider in turn each of the three options Trump selected.
#1 (no assistance from multilateral development banks) is the weakest option, because Russia does not currently get such assistance anyway.
#2 (no bank loans/credit) could have a cost, but the devil will be in the details. @brianoftoole and I have recommended for a year sanctioning sovereign debt. The administration should and presumably has only applied this prohibition to new debt issuance. atlanticcouncil.org/blogs/new-atla…
But it could be narrower still. Whereas modern sanctions broadly prohibit all US persons from any "dealing in" debt, the CBW Act was written in 1991 and only prohibits "any US bank from making any loan or providing any credit" to the Russian gov't except to buy food/agriculture.
That's b/c bank loans were more common than bonds in 1991. The administration could help modernize the scope by interpreting "credit provision" to broadly include any supportive financial services, thus making it difficult for US investors to buy sovereign debt through US banks.
But if they don't (and thus US households, corporates, pensions, governments etc. aren't prohibited), the first question will be: Out of the $11 billion (8% of total) of Russian government debt held by Americans, what portion is held by banks? @tashecon, do you have a sense?
#3 (no exports to Russia of US goods or technology except food and agriculture) could be surprising choice, because on its face it could have a broad and substantial economic cost. For all three sanctions but especially this one it'll will be key to see what waivers State issues.
Recall that the CBW Act allows the President to waive any of these sanctions if he decides that that's in US national security interests, which enabled him/State to waive part or all of 3 of the 4 sanctions selected a year ago and effectively gut them of any practical impact.
Lastly, I'm surprised Trump didn't choose #5 (downgrade or suspend diplomatic relations w/ Russia) given that this wouldn't have an economic cost. Is this b/c Trump is (i) okay w/ some cost, (ii) confident in the waivers, or (iii) very sensitive to & focused on US-Rus. relations?
Let's wait to see the waivers and whether any high-level messaging accompanies this action. The strength and signaling value of sanctions also depends much on how much political support they have, and the perception is that Trump only sanctions Russia when Congress forces him to.
UPDATE: The State Dept confirmed what’s in the thread above, which is that Trump selected the first 3 of the 6 options in the CBW Act. And while the waivers and Treasury details aren't out yet, State's language suggests they are indeed limiting the scope.
#2 (no bank loans/credit) only applies to banks and new issuance, as expected. But it also only restricts non-ruble debts, which @brianoftoole notes could be a loophole. Russia has issued ruble eurobonds before and firms have been turning to ruble debt too.reuters.com/article/us-rus… 
.@IvanTkachev1 notes US banks only hold $3.3 billion of sovereign debt (a minuscule 0.2% of GDP and 0.7% of reserves). @elinaribakova and @david_murr note the EO has a broader definition of banks than elsewhere in US law, but unclear how far this extends. Treasury has to clarify.
#3 in the CBW Act says "prohibit exports to that country of all other goods/tech," but State only says it'll "add export licensing restrictions" to "Commerce-controlled" goods/tech. Not clear how far that'll go but seems like the maximum is the 25% of exports that are controlled.
Lastly, I'll note from experience that the volume and clarity of these types of rollouts can be dialed up or down depending on how strongly the administration wants to bang the drum to signal our seriousness to the Kremlin, to private sector compliance folks, & to other actors.
This process has been as hushed, tepid, delayed, and mealy-mouthed as I've ever seen, with radio silence from senior officials, disjointed releases issued very late on Thurs/Fri nights, and all after a year of foot-dragging. This is the complete opposite of credible deterrence.
