U.S. Sen. Ron Wyden and U.S. Sen. Jeff Merkley, Democrats from Oregon, shown at a meeting in 2021, are supporting stronger economic measures against Russia. (Ron Cooper/Oregon Capital Chronicle)
WASHINGTON D.C. – U.S. Sen. Ron Wyden is continuing to look for ways to tighten the economic vice on Russia over its invasion of Ukraine.
He is now proposing to strip U.S. companies of tax benefits if they trade in Russia and pay taxes there.
The Oregon Democrat also is taking the lead in the Senate to push ahead legislation to remove Russia’s preferred trade status.
Meantime, U.S. Sen. Jeff Merkley said he is hearing “overwhelming support” from Oregonians for such sanctions.
He said President Joe Biden did “exactly the right thing” in applying economic sanctions while averting any military escalation involving U.S. forces. But Merkley said the risks remain grave.
“I know things could happen” and “we could end up with a nuclear conflict.”
Oregon’s senators addressed the Ukraine situation in separate interviews in Washington, D.C., last week with the Oregon Capital Chronicle.
Wyden holds a particularly effective perch to press sanctions as chair of the Senate Finance Committee. The committee has jurisdiction over federal tax and revenue matters.
He points to history as a reason Oregonians and all Americans should be concerned about Russia’s invasion, which came a month ago.
He said the U.S. and its allies should react now to contain the Russian aggression. Sitting back and watching would mean the threat could eventually be “closer to home,” Wyden said. He also sits on the Senate Intelligence Committee.He said the Wyden family knows about oppression and brutal regimes. His parents were both German Jews who fled the Nazis.
The increasing sanctions on Russia are having an impact, Wyden said, putting pressure on Russian President Vladimir Putin.
“Putin has been ballistic” over U.S. and European trade restrictions, he said.
But he said more can be done.
He’s working on legislation to disallow federal tax credits for taxes that U.S. businesses pay when doing business in Russia.
“The sanctions on Russia are important because Oregonians shouldn’t see their tax dollars go to fund the Russian war machine,” Wyden said.
Wyden also worked last week to advance legislation to revoke most-favored nation status for Russia. The move would result in higher tariffs on imported Russian goods.
Biden has proposed the tariff increase and the House passed the sanction on March 17 by a 424-8 vote. Senate leaders expected to pass the measure quickly last week while Biden was in Europe. Action was stalled by a last-minute objection from U.S. Sen. Rand Paul, R-Kentucky.
Wyden said he had been working with U.S. Sen. Mike Crapo, R-Idaho, the ranking Republican on the Senate Finance Committee, to advance the legislation. It is now expected to move through the Senate this week.
Wyden said revoking permanent normal trade relations status for Russia – which would result in the higher tariffs – would “constitute the harshest” economic impairment on Russia exports “in a generation.”
He said the move could help Oregon plywood producers by impeding Russian imports. Russia, which now faces no tariffs for plywood shipped to the U.S., would be hit with a 50% tariff if normal trade relations are ended.
“This could be to our benefit,” Wyden said.
He also remains concerned with cyber warfare deployed by the Russians and other countries to censor information and what he refers to as digital authoritarianism.
He said cyberattacks represent “an extraordinary national security threat.”
Wyden said he has been raising the alarm across Oregon.
“I am very concerned about cyberattacks against Oregon businesses and Oregon governmental bodies, at the state and local level,” Wyden said.
The issue affects all Oregonians, whose own privacy is at risk with such attacks, he said. He has been urging government officials and business leaders to safeguard their operations against such digital attacks.
“It’s all about preparation,” Wyden said.
Merkley said that the financial sanctions already imposed on Russia “have been more effective than anyone thought they would be.”
He said blocking Russia’s access to foreign assets, actions taken by the U.S. and other countries, has been powerful, impairing Putin.
“The ability to cut off him off from his reserves has been extraordinary,” Merkley said.
He said Putin underestimated the stamina of the Ukrainian people – and the willingness of countries in the West to forgo Russian oil and natural gas.
“He thought energy was his leverage over Europe,” Merkley said. “He’s wrong.”
Germany, which has relied heavily on Russia for oil and natural gas, took steps to cut imports from Russia, Merkley noted. Europeans, he said, “are willing to suffer” to stand with Ukraine.
Merkley said the developments underscore the need for the U.S. to establish greater energy independence, particularly reducing the country’s reliance on fossil fuels.
He said oil companies are profiting from the market panic over oil prices that resulted from the Russian invasion. He said he supports a windfall tax on the “incredible profits” of the oil companies. That revenue could be used for rebates to Americans to cover their increased prices at the service station pump, he said.
Merkley said the world faces an “incredibly important moment” with the war in Ukraine.
He said he supports how the Biden administration has responded, including providing military equipment that has allowed Ukraine forces “to fight the Russians to a standstill.” He noted that the Russians have yet to establish air superiority in Ukraine.
Merkley praised Biden’s work to build an international coalition and unite NATO behind sanctions and help for Ukraine. He noted Biden’s warning that aggressors would trigger the NATO alliance to react if Russian forces moved into so much as a foot of NATO-protected ground.
He said Biden’s determination, though, to keep U.S. and Russian forces from military engagement was “exactly the right response.”
Merkley said Ukrainians have made clear that they will fight to retain their freedom from Russia.
“We need to stand up with them,” Merkley said.
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