Obama Sees Jet Attack as Wake-Up Call for EU on Russia

President Barack Obama’s efforts to prod European leaders into imposing tougher sanctions on Russia, all without fracturing the Trans-Atlantic alliance, face a new test with the downing of the Malaysia Airlines (MAS) jet.

Amid mounting evidence that pro-Russian rebels in Ukraine probably launched the surface-to-air missile that shot down the passenger plane, Obama is telling allies bolder steps will be needed if Russian President Vladimir Putin doesn’t halt his campaign to destabilize the Ukrainian government.

“This certainly will be a wake-up call to Europe and the world,” Obama said at White House press briefing yesterday, calling the incident a reminder of “the degree to which the stakes are high for Europe.”

Despite pressure from some congressional Republicans to ramp up sanctions and provide military aid to the Ukrainian government, the administration is likely to wait to see whether the Russian president blinks, according to U.S. officials.

A full and independent investigation, which Obama has demanded, would give Putin time to find a way to pull back without losing face, but if he doesn’t, the attack will prompt European governments to come down harder on Russia, said the officials, who spoke on condition of anonymity because of the sensitivity of the matter.

Some European leaders have joined the U.S. in calling for a full inquiry into the July 17 downing of the jet. German Chancellor Angela Merkel, who spoke by phone with Obama yesterday about the attack, said that the incident doesn’t justify tougher sanctions immediately.

‘Russia’s Responsibility’

“Events have shown that the priority has to be on a political solution and that it is especially Russia’s responsibility for what is going on in Ukraine right now,” Merkel told reporters in Berlin.

Merkel’s was just one position on a wide spectrum of European views. Poland and the Baltic states have advocated harsher sanctions, while at the opposite pole, Italy, Greece, Cyprus and other nations have tried to avoid actions that would endanger their relations with Russia.

“It’s very important that the result of this tragedy should be unmitigated, tough and consistent pressure on the separatists and Russia to stop these actions,” Polish Prime Minister Donald Tusk told reporters in Warsaw yesterday.

More Steps

There are more steps Europe could take, U.S. officials and foreign policy analysts say. In an interview with PBS’s Charlie Rose that also aired on Bloomberg TV, former Secretary of State Hillary Clinton called on EU leaders to aid the Ukrainian government, reduce the country’s reliance on Russian energy company OAO Gazprom and match the tougher U.S. penalties.

U.S. officials involved in sanctions policy say Putin should be given time to respond to the U.S. and European penalties and the results of an inquiry into the plane crash. If it is found that pro-Russian forces shot down the plane using Russian technology, they say, Putin will face a strong enough international backlash that he might have no choice but to back down.

Having imposed sanctions designed to hurt Russia without damaging the global economy, U.S. officials aren’t eager to risk provoking Russia to retaliate against America or EU countries by immediately adding a new round of penalties.

“With respect to the effect of sanctions on the economy, we have consistently tried to tailor these sanctions in ways that would have an impact on Russia, on their economy, on their institutions, or individuals that are aiding and abetting in the activities that are taking place in eastern Ukraine, while minimizing the impacts on not only the U.S. economy, but the global economy,” Obama said.

Isolating Putin

European diplomats say that after months of pressure from Obama, Merkel’s shift to a tougher position was the tipping point for other EU countries to join a regime of sanctions that are less stringent than those imposed by the U.S. this week.

In particular, evidence of Putin sending heavy weaponry over the border into Ukraine to support insurgents influenced the EU leaders, said the diplomats, who spoke on condition of anonymity because of the sensitivity of the matter.

EU foreign ministers are scheduled to meet July 22 in Brussels to hammer out the finer points of the additional measures announced earlier this week, including penalties on more Russians close to Putin, cutting off funding for Russian infrastructure projects and making it possible to blacklist Russian companies if they are making money from the destabilization of Ukraine.

‘Political Will’

Even with the downing of the airliner, European countries remain divided over whether to ramp up sanctions.

Ben Chang, a former U.S. National Security Council spokesman, said in an interview that the shooting down of the jet might provide “that political will, that backbone” to European leaders who have argued against harsher penalties.

The U.S. is continuing to talk with its European allies about further sanctions, State Department spokeswoman Jennifer Psaki said. She declined to say whether she thought those talks would produce new sanctions.

“We can’t make a full prediction of that,” Psaki said.

While polls show Americans have been supportive of sanctions so far, the idea of providing military support to the Ukrainian government is not popular.

A survey of 1,501 U.S. adults in April by the Pew Research Center and USA Today found that 62 percent of respondents opposed sending weapons to Ukraine and 30 percent supported military assistance.

Republicans in Congress have been critical of Obama for not taking swifter and stronger action.

‘Additional Consequences’

“The United States should begin imposing additional consequences on Russia,” Senator John McCain, an Arizona Republican, said in a statement yesterday.

McCain advocated giving weapons and “other military assistance” to Ukraine, imposing sanctions on full sectors of the Russian economy rather than individual companies, and beefing up NATO protection of Eastern Europe, including enhanced missile defense.

Juan Zarate, a deputy national security adviser under former President George W. Bush, said EU countries ultimately will be moved to hit Putin harder.

“I expect this tragedy, which will lay at the feet of the Russians and their proxies, will accelerate and amplify the sets of sanctions to be imposed,” Zarate said. “With Europe touched so directly, I anticipate Europe to be more aggressive than they otherwise would have been absent this horrific event. All will want to ensure that there isn’t needless provocation or costs, but this will lift the reticence to hit Moscow more directly with European financial measures.”

To contact the reporters on this story: Jonathan Allen in Washington at jallen149@bloomberg.net; Indira A.R. Lakshmanan in Washington at ilakshmanan@bloomberg.net

To contact the editors responsible for this story: Craig Gordon at cgordon39@bloomberg.net John Walcott, Michael Shepard

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