The Biden administration has sanctioned multiple Russian state-owned companies — companies that the Obama-Biden administration spent years subsidizing.
These arms of the Russian state, which the United States now believes must be impoverished, are richer thanks to the corporate welfare actions of Presidents Barack Obama and George W. Bush.
“Sberbank is uniquely important to the Russian economy,” the Treasury Department said in its sanction announcement on Thursday, “holding about a third of all bank assets in Russia. Sberbank is the largest financial institution in Russia and is majority-owned by the” Russian government.
Through the Export-Import Bank of the United States, the Obama administration made a priority of subsidizing the state-owned Russian bank.
In June 2012, while Obama was running for reelection on a platform of cooperation with Russia, his Export-Import Bank in Saint Petersburg signed a $1 billion subsidy deal with Sberbank, majority owned by the Russian government.
The Memorandum of Understanding fast-tracked U.S. taxpayer backing for loans by Sberbank — to companies in Russia or elsewhere — that financed the purchase of U.S. goods. In other words, if the Russian government wanted to finance Russian companies, the U.S. government would subsidize it and bear the risk.
This was part of a deliberate Obama-era campaign to subsidize Russian industry, including state-owned companies. Ex-Im bragged in 2012, “Ex-Im Bank exposure in Russia at the end of Fiscal Year 2011 (September 30, 2011) was approximately $315 million, of which $117 million was authorized in FY 2011.”
Separately from that line of credit, in mid-February 2014, when Russian mining company Yakutugol wanted new mining equipment, Ex-Im agreed to guarantee an $18 million loan to Sberbank’s leasing arm. The deal was canceled because Russia invaded Crimea later that week.
Vnesheconombank is Putin’s development bank, important enough to Putin’s political and military strength that the Treasury Department has placed it under sanction. But during the Obama years, U.S. taxpayers regularly subsidized this tool of Russian economic growth.
In January 2014, for instance, a month before Russia’s invasion of Crimea, Ex-Im approved a $703 million loan guarantee to Vnesheconombank’s aircraft leasing service, so that it would buy Boeing jets. Thus U.S. taxpayers were subsidizing the Russian government and its airlines.
That deal was not canceled, and as of January 2022, about $300 million of the U.S.-guaranteed loan was still outstanding, according to Ex-Im records. Another $160 million in Ex-Im-backed financing to Vnesheconombank Leasing is outstanding from a separate 2012 sale of Boeing jets.
In Fiscal Year 2014, Russia was the No. 5 beneficiary of Ex-Im authorizations, with almost all of that financing flowing to state-owned Russian companies.
Former deputy national security adviser Mark Pfeifle wrote in the Wall Street Journal in 2015 that Ex-Im “maintains an operating agreement with Russian arms exporter Rosoboronexport … a chief weapons supplier to Bashar Assad’s regime in Syria and has supplied advanced missile systems to Iran.”
The Bush-era Ex-Im subsidized the Russian Agricultural Bank, which has now also come under U.S. sanctions. Ex-Im approved, and taxpayers thus subsidized, more than $50 million in financing to subsidize Putin’s purchase of John Deere farming equipment.
