Obama warns Russia of ‘isolation’

The United States will take a series of steps to isolate Russia economically and diplomatically if it does not end its intervention in Ukraine, President Obama warned Monday.

In rhetoric that underscored how quickly the crisis in Ukraine has escalated, Obama said the U.S. would look to hurt Russia’s economy if its leaders continued “on the current trajectory they’re on.”

{mosads}He said the administration was “examining a whole series of steps — economic, diplomatic — that will isolate Russia and will have a negative impact on Russia’s economy and status in the world.”

Russian President Vladimir Putin responded on Tuesday morning, blaming a coup in Ukraine for causing instability and fear among Russian-speaking citizens in eastern Ukraine.

Russia has every right to protect those citizens, Putin said, adding that he reserves the right to use military force.

President Viktor Yanukovych, who fled Ukraine, is the country’s only legitimate leader, Putin said.

His comments came after the State Department said it was preparing sanctions to punish Russia for seizing the Crimean peninsula, a region in eastern Ukraine with strong cultural and military ties to Moscow.

“So there are really two paths that Russia can take at this point,” Obama said during a media appearance with Israeli Prime Minister Benjamin Netanyahu. “Obviously, the facts on the ground in Crimea are deeply troubling, and Russia has a large army that borders Ukraine. But what is also true is that, over time, this will be a costly proposition for Russia, and now is the time for them to consider whether they can serve their interests in a way that resorts to diplomacy as opposed to force.”

The president later on Monday met for over two hours with his National Security Council to discuss the situation in Ukraine. According to a source familiar with the meeting, Obama and his team discussed what steps could be taken with the U.S.’s international partners to further isolate Russia, and to reinforce the idea that the Russians still have an opportunity to take immediate steps to de-escalate the situation, or they will face further political and economic repercussions from the international community.   

Senate Foreign Relations panel Chairman Robert Menendez (D-N.J.) said his committee was developing sanctions legislation and would hear from administration witnesses Thursday.

“We are also consulting with the administration on possible sanctions actions against individual Russians and Ukrainians that range from visa bans and asset freezes, to the suspension of military cooperation and sales, as well as economic sanctions,” he said.

House Majority Leader Eric Cantor (R-Va.) said he’s asked his committee chairmen to “develop plans to assist the government of Ukraine, put pressure on Russia, and reassure allies throughout the world that the United States will not stand idly by in the face of such aggression.”

Russia is already paying an economic price as financial markets react to the instability.

The ruble fell 2.5 percent against the U.S. dollar in early morning trading on Monday, driving the Russian central bank’s lending rate up 1.5 points, while the index of Moscow stocks fell 11 percent.

The U.S. has suspended preparations for the Group of Eight summit being hosted by Russia in Sochi and suspended trade talks with Russian government officials who had met with top Obama administration officials as recently as last week in Washington.

“Due to recent events in Ukraine, we have suspended upcoming bilateral trade and investment engagement with the government of Russia that were part of a move toward deeper commercial and trade ties,” said a spokesman for the U.S. Trade Representative.

Secretary of State John Kerry, who is set to arrive in Kiev on Tuesday to assert support for Ukraine’s fledgling government, has also said the U.S. is considering freezing the U.S. assets of Russian officials or their allies in Crimea and barring them from entering the United States. The administration could also target Russian banks and punish companies found to have helped the Crimean occupation.

Obama is under heavy domestic pressure from members of both political parties to stand up to Putin.

Critics say the failure of Congress and the George W. Bush administration to punish Russia for its 2008 invasion of two breakaway regions in Georgia helped embolden the country. Lawmakers of both parties have accused Obama of having failed to act decisively, notably following the alleged use of chemical weapons in Syria.

“I frankly think we’ve lost some ground in the region because our vital allies don’t believe that the United States has the will, the determination, the courage to act, after a red line was drawn, was crossed, and we didn’t act in Syria,” Sen. Chris Coons (D-Del.), the chairman of the Senate Foreign Relations subpanel on Africa, told the American Israel Public Affairs Committee conference over the weekend.

Still, hitting Russia where it hurts won’t be easy.

The U.S. needs Putin’s help on a wide range of issues, including denuclearization, keeping open a supply route to Afghanistan, nuclear talks with Iran and getting Syria to follow through with its pledge to abandon its chemical weapons.

Kerry himself insisted over the weekend that Obama’s “reset” with Russia has produced some positive results.

“I don’t think this is a moment to be proclaiming one thing or the other,” Kerry said on “Meet the Press.” “We’ve had difficulties with Russia with respect to certain issues, and even as we have, we’ve managed to do the START Treaty, they’ve cooperated on Afghanistan; they’ve cooperated on Iran. It’s not zero-sum, dead-alive.”

The 28-nation European Union, which the Obama administration wants firmly in its corner, is also struggling with a unified response. The EU will hold an emergency summit on Thursday but has indicated it might only suspend visa liberalization talks “in the absence of de-escalating steps by Russia.”

Germany, which relies on Russian natural gas, is particularly wary of antagonizing Russia and has won support from Putin for a fact-finding mission to defuse tensions.

The U.S., meanwhile, is pushing for a large-scale monitoring mission into Crimea and eastern Ukraine by the Organization for Security and Cooperation in Europe, but Russia objects.

Kerry is traveling to Ukraine for the first time since protesters overthrew Yanukovych.

“He’s going to be discussing of course Ukraine’s economic and political needs, seeing what additional support we can provide,” State Department spokeswoman Jen Psaki said. “And really sending a strong message that we support the people of Ukraine.”

— This story was first posted on Monday at 1:43 p.m. and last updated on Tuesday at 6:26 a.m.