White House Says Bill Sanctioning Nord Stream Undercuts Talks

(Bloomberg) -- The Biden administration said legislation from Senator Ted Cruz to impose tough new sanctions on the Nord Stream 2 pipeline would undermine U.S. efforts to deter Russia from further menacing Ukraine.

The legislation “will not counter further Russian aggression or protect Ukraine,” said Emily Horne, a spokesperson for the National Security Council. “Instead, it will undermine our efforts to deter Russia and remove leverage the United States and our allies and partners possess in this moment all to score political points at home.”

Cruz’s bill would force the administration to sanction the pipeline after it waived sanctions earlier this year on the project’s parent company Nord Stream 2 AG and its chief executive officer, Matthias Warnig. 

The Senate has scheduled a vote for Thursday.

The vote was the result of a deal Majority Leader Chuck Schumer struck with Cruz, a Texas Republican, who in turn agreed to lift his blockade on dozens of Biden’s foreign policy nominees, including top positions at the State Department and at embassies around the world. 

The bill would require 60 votes in the evenly divided Senate to proceed to the floor. Schumer and the administration have been lobbying Democrats to block it despite widespread opposition to the gas pipeline from Russia to Germany.

Horne said the White House instead supports an alternative plan from Senator Bob Menendez, a New Jersey Democrat, that would make the sanctions contingent on Russia’s actions in Ukraine. Twenty-six Senate Democrats have signed on to that bill. 

“We support Senator Menendez’s legislation, which would trigger severe costs to Russia’s economy if Russia further invades Ukraine, just like President Biden and our allies and partners have made clear we will do,” Horne said.

Cruz has called the gas pipeline a “giveaway” to Russian President Vladimir Putin.

“The point is to stop Nord Stream 2 from ever becoming operational,” he told reporters at the Capitol Tuesday. “That’s the objective.”

He said he expected “several” Democrats to vote for his bill. By Wednesday, it seemed that universe had narrowed a bit, as Democratic Senators Ben Cardin, who told reporters he was still “looking at” Cruz’s bill, and Richard Blumenthal, who had said he would vote for it, signed on as sponsors of the Menendez measure.

A person familiar with the Biden administration’s stance, who asked not to be identified discussing private deliberations, said the Cruz bill, if passed, had the potential to destroy the good will that’s been fostered with Germany’s new government, and lead it to reverse its current position, including on delaying the pipeline’s certification process.

The administration is concerned that if the bill became law it could undermine the U.S.’s ability to persuade other European nations to agree to the severe sanctions the Americans want to impose in the event of a Russian invasion of Ukraine.

On Wednesday in Brussels, Deputy Secretary of State Wendy Sherman ended a day of talks between NATO and Russia by reiterating the administration’s position that an invasion of Ukraine would likely mean that no gas flows through the Nord Stream 2 pipeline anytime soon.

The pipeline will run from Russia to Germany, bypassing Ukraine. Although construction is virtually complete, final permitting by Germany is several months away.

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