(NewsNation) — Since Russia’s invasion of Ukraine, the U.S. has done all but enter the war to help limit Putin’s superior army, fighting a proxy war via training, military funding, financial aid and sanctions.
But Markos Kounalakis, an award-winning foreign affairs columnist, says the key to pressuring Putin is a lot simpler than they think.
“It’s not the oligarchs who are getting hurt here. They lose a few billions, but they’re fine,” Kounalakis said on Wednesday’s edition of “On Balance with Leland Vittert.”
“The $100 bill, however, is one that is held by a majority of those who are out in the countryside. It is the currency that they use for their savings. And so if you’re able to get rid of that $100 bill, you’re able to hit your average Russian right where it hurts, which is in their pocketbooks and their wallet. And that should cause some cause for concern for Vladimir Putin if his people are suddenly feeling the heat of this horrific war,” he continued.
Kounalakis went on to explain that, if enacted, the impact would be felt immediately, as that specific note is a dominant savings currency around the world because it’s easy to transport.
It’s the reason such bills are commonly used by narcotics traffickers and terrorists, but especially in Russia, where 80% of their foreign currency is held in $100 bills.
“And, so, if you get rid of that, and you add the current sanctions that are on banks, there is nowhere for this currency to find expression — they can’t use them. They just basically become worth the paper that they’re printed on,” Kounalakis says.
Even with the more than 661,500 pounds of $100 bills already in Russia, worth an estimated $31.5 billion, Kounalakis says the U.S. can make it worthless.
“If the average Russian who is sitting countryside or in a rural village has a few $100 bills, they’re unlikely to be able to get out of Russia and exchange those in a western bank, which is not sanctioned,” he explained. “You’re in trouble because that money is suddenly worthless.”
In addition, because Russians are stuck in a closed system and can’t exchange their funds, Kounalakis says they wouldn’t be able to replace the $100 bill, either, whether it be into a 100 Euro bill or the 200 Euro bill or even smaler U.S. notes, such as the $50 or $20 note.
“They won’t be able to exchange the money and that’s the whole idea. Russia is really suffering those sanctions and if we can get to the average Russian and make them understand the consequences of their leadership’s actions in Ukraine, then they might be able to actually think about changing that leadership, if that were possible,” he said.