Acquiescing to Berlin, emboldening Moscow and squeezing Kyiv: Biden and Nordstream 2
News reports suggest that Berlin and Washington are reaching an agreement on a Nordstream 2 deal that would greatly increase Kremlin control over gas supplies to Europe. Joe Biden campaigned as a foreign policy master who would work hard to contain the dangers coming from rogue Kremlin policies. At that time, he correctly termed Nordstream 2, the Russian Gazprom gas pipeline project under the Baltic Sea to Germany, “a bad deal,” and Secretary of State Antony Blinken promised in confirmation testimony before the Senate Foreign Relations Committee to work to stop the project.
What’s going on?
This spring the Biden administration decided to accommodate Berlin and hand a geopolitical weapon to Moscow by waiving sanctions on Nordstream 2 AG, the fully-owned Gazprom subsidiary running the project and its CEO, Matthias Warnig, a former Stasi agent and Putin buddy. This opened the door to the project’s completion.
The administration has been trying to strike a deal with Berlin since February to offset the damage the completion of the project would bring to Ukraine and the other countries of Eastern Europe. Now five months later, news reports say a deal is near. While the administration has been tight lipped, Reuters suggests that the agreement is the thinnest of gruel. In exchange for permitting Moscow to bypass Eastern Europe with gas supplies, the U.S. and Germany would provide some form of investment in the Ukrainian energy sector.
The administration has made itself vulnerable. While the Nordstream 2 project was over 90 percent complete by January 2020, as Warnig told the German business periodical Handelsblatt, Congressional sanctions passed in December of 2019 and 2020 stopped all work on it. Work resumed on Jan. 24, four days after Biden’s inauguration — so the completion of the project will be a result of Biden administration policy. And Congressional unhappiness with the policy is palpable and has led to Senate holds on appointments in the State and Treasury Departments.
It would serve U.S. interests for the Biden administration to reassess its position now.
It has given Germany five months to make a serious offer, made a major concession with the sanctions waiver, and has come up with little.
Meanwhile, the sanctions lift has in fact emboldened Kremlin misbehavior. Gazprom has reduced gas supplies to Europe as demand has risen. Putin said publicly that Gazprom will send more gas through Ukraine only if Kyiv behaves. And Putin has written a historical analysis that claims Russians and Ukrainians (and Belarusians) are one people and Ukraine can only enjoy a secure and peaceful future in close association with Russia.
Blinken told Congress in the spring that the sanctions could be reimposed if circumstances warranted it. Between the apparently paltry German “concessions” and recent Russian provocations, it is time for the administration, with Congressional encouragement, to do just that.
Sadly, that is not what we are seeing.
Instead, the Biden administration apparently wants this decision to proceed with minimal attention. Since it could not persuade Germany to do the right thing, it is now pushing Ukraine — the principal victim of Nordstream 2 — to mute its opposition. That is the assignment of State Department Counselor Derek Chollet, who arrived in Kyiv July 20.
Before his Geneva meeting with Putin, Biden called Ukrainian President Zelenskyy to invite him to Washington with a target date of July. The month is almost out, and no date has been set. One must wonder if the White House is — Trump-like — holding Zelenskyy’s White House visit hostage to ongoing Ukrainian silence over this bad Nordstream 2 deal.
It is premature for the administration to expect Zelenskyy’s surrender. House Reps. Marcy Kaptur (D-Ohio) and Andy Harris (R-Md.) recently introduced an amendment to the State Department funding bill that would remove the waiver provision from the Nordstream 2 legislation, which would force the administration to sanction Nordstream 2 AG and Warnig. It is now time for the Senate to add a similar provision to its version of the State Department funding bill. This will require some courage from Senate Democrats, because the administration will be looking to make sure that the House amendment never sees the light of day.
The Biden administration seems to have bought the dubious Berlin argument that allies do not sanction allies — ignoring the fact that a majority of our allies (and EU members) oppose Nordstream 2 and that allies should not make deals with geopolitical adversaries that threaten U.S. interests.
Nordstream 2 would only strengthen the ties between the Kremlin and the German business community, which then serves as apologists for Moscow’s provocative foreign policy. Why should the U.S. facilitate a “bad deal” that looks like the hydrocarbon equivalent of the 1994 Budapest Memorandum, in which the U.S. gave Ukraine worthless security assurances in exchange for Kyiv sending its ample nuclear arms to Russia?
John E. Herbst is the director of the Atlantic Council’s Eurasia Center and a former U.S. ambassador to Ukraine and Uzbekistan.
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