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WASHINGTON, D.C. – Senator JD Vance (R-OH) questioned Biden Treasury officials during a hearing of the Senate Committee on Banking, Housing, and Urban Affairs regarding concerns that failed economic sanctions on Russia are fostering the development of alternative banking systems.

Watch Senator Vance’s full exchange here:


Senator Vance: “Sanctions policy in Russia has been a complete and total failure. We thought that we would shrink the Russian economy by 10%, 20%, 30%, even 50%, yet we’ve shrunk the Russian economy by very little. And if you compare it to the performance of other regional economies, and let’s say in terms of the performance of its currency, it’s actually doing pretty well relative to other world currencies…

“The foreign policy establishment claimed that one of the strongest sanctions measures was the disconnection of Russian banks from SWIFT. Scholars claimed that this would kneecap the Russian economy. But while the Washington foreign policy establishment was preoccupied with crafting a sanctions regime, they failed to consider that Russia had been developing their own alternative to SWIFT, which is of course the SPFS…

“My concern is that our Ukraine policy has had this massive, unintended consequence. And if we had gone into this 18 months ago knowing that we would be pushing Russia and India closer to the Chinese — we’re encouraging the creation of an entirely alternative financial system — it’s really important that our law enforcement has access to some of these financial transactions. It’s one of the ways we catch international crime. It’s one of the ways that we prevent international terrorism. If the consequence of our Ukraine policy is weakening that financial system and strengthening an alternative financial system, I think it’s one of the many consequences for our country that our policymakers haven’t fully incorporated.”