The Abramovich Sanctions & Oligarchy Explained: Chelsea, Putin, Russia Billionaires & War in Ukraine

The sporting world has been rocked by news that Roman Abramovich, owner of English Football giant Chelsea FC, has just been sanctioned by the UK government.

Chelsea can no longer sell tickets to games, sign new players or contracts.

They’re not even allowed to sell merchandise.

Abramovich isn’t the only one being targeted either.

Right around the world we’re seeing Russian billionaires scrambling to sell off their most valuable assets

While others are already seeing theirs being frozen or even seized

Like this super yacht belonging to Alisher Usmanovwhich is apparently worth close to a billion dollars and is now in the hands of German authorities.

As you may have already guessed this is all happening in response to Russia’s invasion of Ukraine.

But you might be wondering why Russian billionaires are being targeted?

It comes down to one word: oligarchy.

Russia is often referred to as an oligarchy. which is basically when a small group of powerful people hold control over a country & its government.

Those powerful people are known as oligarchs

And that term is often used to describe extremely rich Russian businessmen. like Usmanov and Abramovich.

Now just to be clear it’s not just Russia that gets called an oligarchy some even use the term to describe the US

But the wealth and rise to power of many of Russia’s billionaires is closely tied to the Russian government and a key part of understanding why they’re being targeted now.

Basically when the Soviet Union collapsed and modern-day Russia was born in 1991 a lot of Russian businessmen became very, very rich.

Because the Soviet Union was communist the country’s entire economy was owned by the state. We’re talking gold mines, TV stations , oil wells, you name it.

Russia and its first President Boris Yeltsin on the other hand decided to ditch communism and that meant dividing up the state’s major assets in a process that was plagued by corruption. Billionaires were born overnight.

The fortunes of Russia’s biggest billionaires have continued to grow as has their influence and dominance over Russia’s industries. Under Yeltsin a number of oligarchs ended up taking positions in the government itself and there have been accusations of money flowing between oligarchs and political leaders that continues to this day.

This brings us back to the current sanctions.

The idea is that by targeting Russian billionaires, many of whom are thought to have a lot of influence back home, will directly influence the conflict in Ukraine and potentially even result in the billionaires banding together to pressure Putin and the Russian government to stop the war.

But the big question is: will it work?

In some ways it may have an impact. For example, Abramovich, who has just had an estimated $19 billion of his assets frozen, has been accused of supplying steel through one of his companies to make the Russian tanks that are being used in Ukraine.

As for the whole ‘getting together to pressure Putin to stop’ plan, many argue that the political influence of oligarchs just isn’t what it used to be.

To add to this Russia has a bit of a reputation for ‘piranha capitalism’ meaning a lot of these oligarchs don’t exactly work together and individual survival is often the main goal

Which makes the idea of oligarchs banding together to take down Putin even more unlikely.

Whether or not sanctioning Russia’s elite proves to be effective, is something we’ll have to wait to see

In the meantime Ukraine and its allies will be hoping that if they don't, other sanctions aimed directly at Russia’s economy and financial systems can help to bring this war one step closer to a peaceful solution.

[medow]

Why you dont create longer videos? Please?

[inf_]

I always enjoy when you make these explainer videos, they’re always so interesting! Thanks for making them