Canceling Russia

First came the official sanctions, long warned of by Western governments but surprising to many in their speed and forcefulness. Bans on Russian imports, freezes on Russian financial assets, and the isolation of the Russian banking system, all came within days of Russia’s invasion of Ukraine. But then, rather less expected, came a growing tsunami of unofficial sanctions, as company after company sought to wash its hands of any connection to the Russian economy or society. Some were potentially crippling: Visa and Mastercard’s suspension of all credit card services, for instance. Others were perhaps mere virtue signaling, such as McDonalds’s announcement that henceforth it would stop selling hamburgers in Russia but keep paying its Russian employees—in other words, subsidize the Russian economy. Some were downright farcical, such as the decision by some leading orchestras to stop performing music by Tchaikovsky.

Those who view the response to the war in Ukraine through the moralistic lens of a playground bully finally getting his just comeuppance might be content to cheer every fresh pile on. After all, Russian President Vladimir Putin is just that sort of bully. But there is something rather odd and unsettling about this corporate cancellation of an entire nation. Historically, private businesses have usually insisted on trying to maintain business as usual in wartime, even when governments tried to stop them. During the Napoleonic wars, for instance, U.S. merchants stubbornly continued their trade with France and Britain despite various attempts by the U.S. government to impose embargoes. Today, though, the private sector is galloping out ahead of the U.S. State Department. This trend should trouble us for two reasons.

First, whereas the actions taken by U.S. and European governments reflect (one hopes!) careful weighing of diplomatic, military, and economic factors to achieve policy objectives, those taken by corporate giants seem reminiscent instead of the mass mania of cancel culture. A behemoth like Royal Dutch Shell, which over the years has weathered storms of controversy over climate change and human-rights violations, was forced into abject apologies for daring to purchase a shipment of oil from Russia. Influencers on Twitter demanded a boycott of Coca-Cola for daring to continue supplying the Russian people with its caramel-colored corn syrup. The corporate crackdown on Russia seems less an effort to dethrone Putin or save Ukraine and more of a way to satisfy the manic morality of guilt by association that won’t allow Delta Air Lines to stay out of controversies over Georgia’s voting laws.

I have no desire to defend Russia’s actions against Ukraine, and there may well be good reasons for a coordinated economic boycott of Russia by Western firms across all industries, but if so, it would be helpful to know the criteria on which such decisions are made. How much of this is principled support for Ukraine? Will such boycotts last beyond a season of virtue signaling?

Second, the remarkable ability of Western businesses to pull the plug on the Russian economy should also be a wake-up call to us here in the United States. Since the fall of the Soviet Union, the once-autarkic Russian economy has been invaded by Western businesses, to the point that many basic goods and services depend on foreign suppliers and infrastructure. We might smile at their dependence on the powerful economies west of them until we realize that we are in the same boat. Over the past couple of decades, the United States has come to rely on China not merely for cheap consumer goods, but also for advanced industrial technologies, telecommunications, pharmaceuticals, and more. COVID-19 was a warning about these supply-chain dependencies; the economic boycott of Russia is a red alert. This boycott will bring significant costs at home, as well as in Russia.

It is not difficult to imagine a time in the next few years when rising political tensions over Taiwan provoke the Chinese government and Chinese businesses to pull the plug on the American economy in the way we have tried to do to Russia. As things currently stand, the United States is thoroughly unready for such a showdown. During decades of free-trade orthodoxy, American statesmen forgot that one of the core duties of a nation is to ensure its own self-sufficiency, its ability to hold its own against threats to its sovereignty from either foreign states or private actors.

In the present case, we may perhaps cautiously celebrate the fact that Putin’s miscalculation has led to a whip-fast response of economic sanctions both private and public. However, in this nation, we must hope for leadership that can protect American society against the threats of similar economic reprisals in the future.