The Nord Stream 2 deal struck by U.S. President Joe Biden and German Chancellor Angela Merkel is big news of the worst kind in Central and Eastern Europe. In the conventional analysis of the news, the United States and Germany teamed up to please Russia, leaving Ukraine by the wayside. But there was another reason, connected to U.S. businesses rather than lacking sympathy for Ukraine, that likely forced Biden’s hand: U.S. sanctions on companies open the door for other countries to sanction U.S. companies too. What’s more, U.S. sanctions could convince companies to stop trading in dollars—and that would severely weaken the United States’ role in the world.
Under the Biden-Merkel deal, the United States and Germany commit to investing $50 million each in Ukrainian green energy. This is to help Ukraine get the $3 billion annual transit fees Russia has been paying to send gas through Ukrainian pipelines and to sanction Russia should it use Nord Stream 2 for coercion. To many, it sounds like Biden sold out.
