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How the DETER Act will fuel Russian election meddling

October 6, 2018

Sen. Chris Van Hollen is working hard to prevent Russian President Vladimir Putin from meddling in November’s midterm elections. Unfortunately, the bill he has put forward would inadvertently help the Kremlin — and hurt America and its allies.

Together with Marco Rubio (R-FL) Van Hollen has introduced the “Defending Elections from Threats by Establishing Redlines Act.” Cleverly called the DETER Act, the legislation would harshly sanction Russia if it put its finger on the scales of American democracy ever again.

The sentiment behind this reform is certainly laudable. America’s intelligence apparatus has confirmed that Russia interfered in the 2016 election. And there’s mounting evidence that the country is already meddling with this November’s midterms. The nation’s electoral process is sacrosanct — and any country that tampers with it deserves swift and severe punishment.

But the sanctions included in the Deter Act are so poorly designed that they would benefit Russia, damage the U.S. economy, and strain relations with our allies.

If the Director of National Intelligence determines that Russia has tampered with an American election, the Deter Act requires the Treasury Department to block all financial transactions involving a long list of Russian state-owned entities, including banks, railways, and energy firms.

This might sound like just punishment. But the impact would be so broad that U.S. entities would be hurt even more than those in Russia.

Moscow might even welcome the Deter Act, as its sanctions would require American companies to exit any joint ventures with Russian entities, such as state-owned energy companies. If this happens, Russian firms will gladly take over for these exiting U.S. businesses — reaping considerable financial rewards in the process.

In this way, the sanctions would inflict economic pain on an industry that supports more than 10 million American jobs and contributes over a $1 trillion to our economy each year. Russia’s energy firms, meanwhile, would only grow richer and more powerful.

American energy firms wouldn’t just have to cut ties with Russia, but with neighboring countries as well. That’s because the Deter Act bans U.S. oil and gas companies from utilizing any railways or pipelines that cross into Russia. Without access to this transportation infrastructure, U.S. companies will have a harder time selling oil and natural gas resources — including to our allies in Europe.

The economic fallout for these countries in Europe could redound to Russia’s advantage. To date, Europe has been an essential partner in our efforts to check Russian aggression towards nearby states such as Ukraine. Unilateral sanctions could weaken this united front — a dynamic that Russia could easily exploit for its own geopolitical benefit.

Economic sanctions could be an effective response to election meddling, so long as they’re targeted. The penalties in the Deter Act, however, are far too blunt. Sen. Van Hollen is certainly well-intentioned. But his hastily prepared bill would hurt Americans just as much, if not more, than the Russians.

Christopher Summers is president and CEO of the Maryland Public Policy Institute.

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