Bill Browder on Putin, sanctions and how to end the war

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International sanctions imposed on Russian President Vladimir Putin have frozen his personal assets. Or at least the assets he seems to own.

Sanctions against the Russian oligarchy in Putin’s orbit may be more effective. This is not necessarily because these well-connected billionaires on the run around the world can pressure the president to change the course of the war in Ukraine. According to William F.

Mr. Browder, who was a major investor in Russia, has become one of the Kremlin’s biggest enemies. Russia has tried several times to persuade Interpol to issue arrest warrants for him. He is such a thorn in Mr. Putin’s side that the Russian president singled him out by name during his first official summit with President Donald J. Trump.

What did he do to attract this anger? Mr. Browder ran one of the largest hedge funds in Russia in the late 1990s and early 2000s. But his public fights against corporate corruption eventually led to his expulsion from Russia in 2005 as a “national security threat.”

In 2009, his tax attorney, Sergei Magnitsky, who was investigating state money laundering, was arrested, and later died in a Moscow prison about a year later, at the age of 37. The death of the lawyer with penalties. At Mr. Browder’s request, similar laws were passed around the world.

This makes Browder well aware of the effects sanctions have on Russia’s political and business elite, not least Mr. Putin. And now that world leaders have imposed round after round of sanctions on Russia for its invasion of Ukraine, it offers a unique perspective on how these actions affect Mr. Putin’s calculus.

Ahead of the release of his new book, The Freeze System, DealBook spoke with Mr. Browder about how to end the war in Ukraine, what influence the oligarchy has and what really motivates Mr. Putin. The conversation has been edited and condensed.

What do you think of Mr. Putin’s endgame at this point?

Putin is a dictator. One of the great benefits of a dictatorship is that he can steal money of his choice. And he chose to steal a lot.

After a while, in a country where people kind of think they are in a democracy, they start seeing that they are starving and not receiving care in hospitals and their children not receiving an education. They begin to get angry, get angry at the man responsible. And so every now and then, the man in charge has to do something to lessen people’s anger at him.

The purpose of these wars is his fear of a coup against him. And so the best way to do that is to get everyone to rally around the leader. And so when you talk about an end game, there is no end game. This is just his staying in power.

As an old target of Mr. Putin – and someone I imagine he tried to better understand what motivates him – what do you think he’s thinking?

The problem is that there are some psychological features that fuel this whole thing, making it a particularly poisonous drink. The world he lives in is like a prison yard. This is a world where everyone kind of looks at each other aggressively, and everyone has to show strength to each other. As you know, the strongest person in the courtyard must be the most ferocious one in order to maintain their strength.

And so his idea was to destroy Ukraine and then hit his chest and show everyone how strong he is. But his misjudgment of the effectiveness of the Ukrainians’ resistance to retaliation made him look stupid. And for a prison yard type person, this is the worst thing that could ever happen.

Do you think he understands that?

Definitely.

Do you think that everyone around him is a man of yes?

It’s not just about the people around him. They are also the people of the West. The Ukrainians showed him great disrespect by responding successfully. Thus, for example, the war crimes that were committed were not accidental. This is part of his thing.

He must show that he, his people, and everyone around him are very evil. They will keep stepping up and escalating the ante, not caring what people think about them. In fact, they want people to think these bad things about them because it just makes them look even wilder.

Given what you’re saying, what’s a reasonable way to think of the end game?

There is no reasonable way to end this thing. There is just an unreasonable way.

Either he ends up taking over Ukraine and then moving to the Baltics to challenge us in NATO – or Ukraine defeats him and then the Russian people bring him down because he was the weak guy they couldn’t beat. Ukraine.

How do you hinder these two options?

I think each of these options has a 15 percent probability.

What is the probability of the remaining 70 percent?

He and the Ukrainians and all of us are stuck in this low. It wouldn’t be quite as awful as it is now, but in this low-slough struggle that goes on and on for years.

Do you think the oligarchy really has an effect on him? Do you think punishing them was effective?

It is like a medicine for a certain type of disease. The medication can have a greater effect depending on when you take the medication. So if we had sanctioned the oligarch before the invasion and had done so with closed arms with our allies, that would have had a much greater effect on his actions than he did now.

That doesn’t mean we shouldn’t do it now, but he was betting there wouldn’t be serious penalties because he’s done a lot of terrible things over the past 20 years and there weren’t any serious penalties before.

But does Mr. Putin care what the oligarchs think?

from him? no.

But it is very important that we punish every oligarchy for a different reason than hoping that an oligarch will overthrow him. Few keep his money. So when you see a $20 billion fiscal rule ruling, $10 billion of that is Putin. He cannot keep any money in his name.

So, he has to give it to someone who already has enough money to act – to be the owner of this money. When we say we want to punish Putin, the only effective way to do that is to punish the oligarchy. The reason is not to get him to change his mind or persuade the oligarchy to overthrow him – it is mainly to prevent him from using this money to carry out this war in the future.

So it’s not that these few are calling him and saying, ‘You have to stop this thing’?

Few could do that. Any oligarch who did so would be immediately arrested, impoverished, and killed.

What do you think American companies should do? What do you think of those who worry that if they leave they will never be able to come back?

First of all, continuing to do business in Russia after this invasion is equivalent to continuing to do business in Nazi Germany when Hitler began persecuting the Jews. It’s the same.

Every company has a moral obligation to get out of Russia, no matter the cost. I don’t think anyone should worry about going back because everyone will be welcomed back into the post-Putin system. And under Putin’s regime, I don’t think anyone should want to go back.

What about China? What is its effect at this point?

The only loophole in this whole thing is China, right? China has been very clear that it will not join the rest of the world in challenging or punishing Putin for what he does. I think China should be careful.

why? Does China still influence the West?

Well, the answer is that the US will probably be less likely to punish China than the consumers themselves will punish China.

So, do you think consumers will step in to punish China for supporting Russia?

I can easily imagine a movement in which every American consumer looks at the label. Ultimately, consumers, whether they are regulated by the government or not, have as much power as governments – or more.

Do you think Mr. Putin still has people following you?

The way Russia works is that I don’t think he spends much time with me, but he gave an order 10 years ago to his government to go after Bill Browder in every possible way. Until the order is cancelled, there are people whose job it is to go after me, no matter what happens in the world. And they keep stalking me.

What do you think? Will sanctions on the oligarchy pressure Putin to end the war? Let’s know: dealbook@nytimes.com.

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