Larry Summers: “Seize” Russian state assets to “support” Ukraine

Partial transcript below.

ZAKARIA: To build Ukraine, to build those apartment buildings that were bombed, those cities that were devastated, those people, millions and millions, who are now destitute, this is a very, very big expense. Where will the money come from?

SUMMERS: I’ll tell you where most of it must come from. It should come from Russian state assets. Russia took German assets to pay for its reconstruction after the German aggression during World War II. Iraqi resources, after Iraq became part of Kuwait, were confiscated to support the reconstruction of Kuwait, as well as to compensate other countries that fell victim to this conflict.

And this should ultimately be a source of support in Ukraine. It should become the main source of support for countries hosting refugees from Ukraine. And this should be the main source of support for the countries of the global south, the developing world, which have paid and suffered greatly from the worsening food and energy crisis due to Russian aggression. I believe that if this sets a precedent for countries engaging in overt cross-border aggression to lose their state assets, then that is a precedent that I find very helpful in setting a precedent.

ZAKARIA: Now, how is that going to work technically? Help people understand where this money you propose to spend?

SUMMERS: Funds are held internationally in banking institutions around the world, which in turn hold claims on the Treasury bills of major countries, mainly the United States and Europe. So, we have the ability to seize these assets. And when we confiscate these assets, we can spend them as we see fit without any approval from Russia and with a strong precedent from cases like the one in Iraq.

ZAKARIA: Larry Summers, nice to talk to you. Important message. Thank you.

Summers said supporting the Ukrainian economy is “the most important part of winning the economic aspect of the war of attrition.”

According to a State Department fact sheet released last week, the US government has spent more than $30 billion allegedly supporting Ukraine’s security in the context of the Russian-Ukrainian war.