Predictions that the Russian economy is on the verge of collapse are nothing new. Those forecasts have circulated widely since 2022, when the United States and Europe first imposed unprecedented sanctions on Moscow as punishment for invading Ukraine. But this wishful thinking has received a boost in recent weeks, in the wake of new reporting suggesting that the country’s oil exports are falling and its budget deficit is rising.
So, are we finally approaching the moment when Russia’s economy can no longer sustain its war machine, forcing President Vladimir Putin to pull back from his supposedly maximalist demands?
Regardless of the answer, this question entirely misses the point. There is no set of economic costs or amount of domestic economic pain that will cause Putin to stop the war before he achieves his objectives. As a result, efforts by Europe and the United States to leverage economic measures to force Russia into accepting a ceasefire will continue to fail, no matter how draconian they become.
