Stopping all hundred-dollar bills will put more political pressure on the Kremlin than all sanctions.
Sanctions had almost no effect for most Russians. But there is something the US Treasury can do to put real political pressure on Vladimir Putin's regime. This is the immediate cessation of circulation of all $ 100 banknotes in Russia.
Horoscope researcher Marcos Kounalakis writes about this in an article for the Wall Street Journal. He notes that Russians do not invest in pension funds. Instead, both wealthy and ordinary Russian citizens are trying to protect their savings by buying US dollars. The instability of the ruble contrasts sharply with the stability and security of the US currency. And for many years, Russians have preferred $ 100 bills. As of 2019, there were 300 kilograms of such bills in Russia, hidden in mattresses and other household hiding places. That's about $ 31.5 billion.
Currency problems have always caused panic in Russia. In 1996, Washington's decision to change the design of the 100-dollar bill to make it harder to counterfeit frightened Russians. They feared that their savings would suddenly turn to paper. People began to refuse to accept old-style bills. In those days, the Russians had more dollars on their hands than any other currency. And most of these green banks had a face value of 100. Back then, in the 1990s, the US Treasury Department said nothing about recalling old-style dollars. But many Russian banks have refused to accept them or demanded an additional fee for the exchange.
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The author notes that sanctions have failed to force Putin to abandon his military goals. And this is partly because the well-being of most Russians has not been affected. Instead, the rapid cancellation of all hundred-dollar bills will create real dissatisfaction among the Russian population with the war against Ukraine. Given the current state of Russian banks, they cannot easily and quickly convert these dollars into something else. The savings of the Russians will sharply turn into ordinary paper. Then Putin will no longer be able to hide the effects of the war from those he relies on.
President Joe Biden must make it clear that all 100-dollar bills will be canceled precisely because the Russian autocrat started the war against Ukraine. After that, Putin can distort the truth and invent anything. But Russians will still know that it is because of his behavior that all their savings have suddenly disappeared. In fact, it would be a good idea to cancel all $ 100 bills in the world. After all, 80% of them are in their pockets abroad. Easy-to-transport cash is an important tool for global corruption and crime, said former Treasury Secretary Larry Summers.
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Large bills, such as $ 100, are used by terrorist groups and drug traffickers to organize their trade operations. That is why the 500-euro banknotes were nicknamed “Bin Laden”. The United States stopped using $ 500, $ 1,000, and $ 5,000 bills back in 1969. If large banknotes are now obsolete again, it will strike at autocratic regimes, such as the DPRK. They will lose an easy way to launder money.
Research in the United States says giving up $ 100 will help combat tax evasion and theft. Even the beginning of discussions on the possible elimination of hundred-dollar bills will create problems in Russia, Iran, Venezuela and other countries. Only a hint of this can shake Putin's political status quo more than sanctions. After all, any nonviolent way to force Putin to abandon his imperialist goals and save lives in Ukraine is worth a try.
