Recently, Daniel Drezner, professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University, published a long article in Foreign Affairs, dissecting the current situation of US sanctions. He noted that the U.S. government is increasingly keen on sanctions, but the effect is not good, and there is a lack of policy review and exit mechanisms for sanctions, and it tries to give a "prescription". Observer Network translates this article for the reader's reference, and this article is the previous part.
[Text/Daniel Drezner, trans./Changyi]
Theoretically, a superpower should have a range of foreign policy tools: military power, cultural charisma, diplomatic persuasion, technological prowess, economic aid, and so on. But for those who have followed U.S. foreign policy over the past decade, it is clear that the tool the United States relies on most is economic sanctions.
Sanctions, measures taken by one country to undermine economic exchanges with another, have become the preferred solution to almost all foreign policy problems.
During President Ma's first term, the United States issued an average of 500 sanctions orders per year for human rights abuses, nuclear proliferation and territorial sovereignty. During Trump's presidency, that number has nearly doubled.
In his first months in office, President Biden imposed new sanctions on Myanmar, Nicaragua and Russia. Aside from lifting sanctions against the International Criminal Court, he has not fundamentally changed any of the Trump administration's sanctions plans. The Biden administration sanctioned some Saudi officials to punish the murder of dissident Khashoggi, but human rights activists want to see more sanctioned. Activists have also called on the United States to impose sanctions on China, Hungary and Israel.
U.S. sanctions have led Russia and Iran to move closer quickly
If economic sanctions are particularly effective in getting other countries to act in accordance with Washington's demands, then this reliance on economic sanctions is natural, but it is not. Academically, the most lenient estimate of the effectiveness of sanctions is a 2014 university of North Carolina database study that found that sanctions can only force concessions within a maximum of one-third to one-half probability.
A 2019 study by the U.S. Government Office of Accountability showed that even the federal government doesn't necessarily know when sanctions will work. Officials from the Treasury, State and Commerce departments said "they have not yet conducted an institutional assessment of whether sanctions can more broadly achieve the goals of U.S. policy," the report said.
The truth is that Washington's obsession with economic sanctions has little to do with their effectiveness and more to do with something else: the decline of the United States. The United States is no longer a superpower that no one challenges, and it can no longer play as hard as it once did. Relatively speaking, its military power and diplomatic influence have declined. 20 years of war, recession, polarization, and now the COVID-19 pandemic have all weakened the United States. Frustrated U.S. presidents find that they have fewer arrows left in their quivers, and they will soon reach out for sanctions, a simpler, more usable tool.
The problem, however, is that sanctions are not without cost. They strain U.S. relations with allies, antagonize competitors, and cause economic hardship to innocent civilians. Thus, sanctions not only indicate the decline of the United States, but also accelerate its decline.
To make matters worse, the tool is becoming more and more obtuse every year. Future sanctions are likely to be more ineffective, as China and Russia happily jump out to save countries hit by the United States, while U.S. allies and partners get tired of repeated economic pressure. Taken together, these developments would reduce the centrality of the dollar in global finance, thereby reducing the effectiveness of sanctions that rely on dollar dominance.
Germany's Nord Stream II project is also not immune to the threat of U.S. sanctions
Washington should use sanctions surgically and in moderation. Under a more standardized economic national policy strategy, officials will define the targets of a particular measure and the criteria for its repeal. But most importantly, they know that there are other tools available to them. Sanctions are a specialized tool that is best used in situations that can be controlled, rather than a universal tool used on a daily basis. Policymakers should think of it as a scalpel, not a Swiss Army knife.
A history of economic violence
Since the early days of the United States of America, economic policy has been an important part of U.S. diplomacy. President Jefferson pushed for the passage of the Embargo Act of 1807 to punish Britain and Napoleonic France for harassment of American ships. This sanction is a disaster. At that time, the demand for the European market in the United States was far greater than the demand of Britain and France for the market of a new country in the New World; the loss caused to the United States by the embargo law was far greater than the loss to the European powers. Even so, the United States still uses trade as its primary diplomatic tool, focusing on priing open foreign export markets and boosting foreign investment at home.
Given that the U.S. army was insignificant for most of the 19th century, this is a natural thing. The pound's dominant position in global finance also means that the dollar is not an important currency. At this time, trade is the main way for the United States to conduct diplomacy.
At the end of World War I, the United States renewed its enthusiasm for trade sanctions as a means of regulating world politics. President Wilson pushed Americans to support the League of Nations, arguing that its sanctions could replace war. He said in 1919: "A country that is economically sanctioned is a country that is about to surrender." He added: "With this economic, peaceful, silent, effective corrective measure, there is no need for the use of force." This is a daunting corrective action. ”
The Americans disagreed, and the United States never joined the League of Nations. Ultimately, the sanctions imposed by the League of Nations failed to prevent Italy from invading Ethiopia in 1935, nor did they prevent any other kind of belligerent behavior that led to World War II. On the contrary, the U.S. embargo on fuel and other war materiel flowing to Japan contributed to the attack on Pearl Harbor (Observer Network Note: The 1941 U.S. embargo on strategic materials against Japan was in view of Japan's expansion of the scale of aggression against China and its entry into Southeast Asia, threatening the strategic interests of the United States. The goal japan sought in the Japan-U.S. negotiations was to force the United States to recognize Japan's dominance over Asia and the western Pacific, not just to lift the embargo. The simple belief here that the U.S. embargo led to the Japanese attack on Pearl Harbor is a pseudo-history concocted by the Japanese right-wing in the postwar defection to the United States. In order to win over Japan, the United States has also acquiesced to this pseudo-history to a certain extent. ）
The American film Pearl Harbor was grand, but skipped the most important historical fact: the Japanese Navy had attacked Pearl Harbor long before the United States responded
The outbreak of the Cold War allowed the United States to use economic policy on a larger scale. For the first time, the United States provided a large amount of multilateral and bilateral foreign aid; halting aid was an easy way to exert economic pressure. The most successful U.S. economic sanctions during this period were during the Suez crisis in 1956. Washington, angered by the British, French and Israeli invasion of Egypt, prevented Britain from withdrawing its share of the IMF to protect the pound. Subsequently, the pound sterling was run on forcing London to withdraw.
Most of the time, however, U.S. sanctions fail. In the early days of the Cold War, the United States imposed an embargo on Soviet allies, denying them access to vital resources and technology. The embargo was successful as a deterrent, but the sanctions had little effect in forcing the Soviet allies to change their political stance. Because of the Intervention of the Soviet Union, economic support was provided to those who were sanctioned by the United States. For example, in the early 1960s, when the United States tightened its export embargo on Cuba, the Soviet Union provided economic space for the Castro government by providing substantial aid to Havana.
In the late Cold War, the United States used economic sanctions to pressure allies and adversaries to improve the human rights situation in those countries. Aside from the rare success of sanctioning close allies, economic pressures only work when they come from a broad multilateral coalition, such as the U.N. sanctions on apartheid-era South Africa.
The end of the cold war gave the initial hope of sanctions. With the Soviet Union using less veto power in the Security Council, multilateral trade sanctions seemed likely to replace war, as Wilson had dreamed. Reality soon proved otherwise. Following Iraq's invasion of Kuwait in 1990, the Council imposed a comprehensive trade embargo on Iraq. These harsh sanctions have halved Iraq's gross domestic product. However, they were unable to force Saddam Hussein to withdraw from Kuwait;
After the war, sanctions against Iraq continued, but from a humanitarian perspective, the costs were staggering: infant mortality was widely believed to have risen sharply and per capita income had stagnated for 15 years. Iraq manipulates the numbers and exaggerates the humanitarian costs of sanctions, but this deception is effective. Policymakers have come to believe that trade sanctions are a blunt weapon that hurts ordinary civilians, not the behavior of elites they want to change. So they look for smarter sanctions to strike at a regime's ruling bloc.
The centrality of the dollar seems to provide a way to achieve that goal. Beginning in the late 1990s and accelerating after 9/11, the United States made it harder for any financial institution to transact dollars with sanctioned governments, corporations, or individuals. U.S. and foreign banks need to get dollars to function; even the implicit threat of being denied dollars makes most of the world's banks reluctant to cooperate with sanctioned entities, effectively expelling sanctioned countries from the global financial system. Such sanctions have proved more effective. Restrictions on trade have spurred private sector actors to engage in black market operations, while measures to trade dollars have had the opposite effect. Because financial institutions care about their global reputation and want to be favored by U.S. regulators, they are often keen to comply with sanctions or even preemptively dump customers deemed too risky.
As U.S. sanctions have grown, they have achieved some visible victories. The George W. Bush administration has cracked down on terrorist financing and money laundering, and governments have spared no expense to preserve their access to the U.S. financial system. The Obama administration has tightened sanctions on Iran, prompting the country to negotiate a deal to limit its nuclear program in exchange for the lifting of some sanctions.
The Trump administration has threatened the Mexican government with raising tariffs and closing the U.S.-Mexico border. It took such measures to force Mexico to intercept Central American migrants; in response, the Mexican government deployed more National Guard units to limit the flow of migrants.
However, every success of this approach is accompanied by more failures. The United States has imposed decades-long sanctions on Belarus, Cuba, Russia, Syria and Zimbabwe, with little practical effect. The Trump administration has increased economic pressure on Iran, North Korea, and Venezuela as part of its "maximum pressure" to limit even the slightest circumvention of economic restrictions by those countries. These efforts also rely on so-called "secondary sanctions", where third-party countries and companies other than the sanctioned party do not agree to participate in the sanctions, they will be financially coerced.
In each case, the sanctioned countries suffered heavy economic losses, but they did not make any concessions. Even Venezuela, a bankrupt country experiencing hyperinflation in the U.S. backyard, has not acquiesced to the demands made by the United States.
The sanctions policy suffered setbacks
There are a number of problems with the economic sanctions currently being used by the United States. The biggest problem, and the most common problem, is that maximum pressure also brings maximum demand. The United States wants north Korea to be denuclearized, Iran to be denuclearized, and venezuela to end its "bolivarian rule." For the leaders of these countries, these demands are essentially equivalent to demanding regime change. It is not surprising that they have chosen to endure financial pain rather than make such a huge concession.
The events in Iran highlight another problem: the increasingly unilateral nature of U.S. economic pressure. Until recently, the United States was often able to impose financial sanctions, both overtly and covertly, with the cooperation of its allies. However, when the Trump administration decided to reimpose financial sanctions on Iran, it did not take into account the opposition of European allies to the sanctions. By threatening "secondary sanctions" against other countries, the government has successfully implemented a policy of increasing pressure on Iran's economy. Those countries that had been opposed by those countries eventually compromised, a move that increased the cost to Iran, but the price of success was to strain long-standing U.S. relations with other countries.
At the same time, the U.S. government is becoming increasingly comfortable with sanctioning other powers. What works for Mexico, however, does not work for China or Russia. The larger the country subject to sanctions, the more resources are available to resist them. Sanctions imposed on Russia in the wake of the Ukraine crisis may prevent the Russian government from taking more aggressive actions in its surrounding areas, but it is already a low-standard victory. By any reasonable measure, this sanction has not achieved its goal, because Russia is still violating international norms.
Similarly, the variety of tariffs and other restrictive measures imposed by the Trump administration on China in 2018 have failed to make any substantial concessions to China. The United States launched a trade war to transform China's economy from "state capitalism" to a more market-friendly model, but the trade war eventually produced some frustrating results, with sanctions backproducting and hurting the U.S. agricultural and high-tech sectors. According to Moody's, only 8 percent of the cost of the tariff increase is borne by China; while 93 percent is paid for by U.S. importers and ultimately passed on to U.S. consumers in the form of price increases.
U.S. consumers bear most of the costs of the U.S.-China trade friction
A related problem is the ratchet effect. Presidents have always been keen to impose sanctions, but they are cautious about lifting them, because then there will be accusations of weakness in their foreign policy, which makes it difficult for the United States to really make a commitment to end them. For example, when Biden considered lifting some of the sanctions on Iran, Republican lawmakers criticized him as a naïve appeaser.
Moreover, many of the sanctions imposed by the United States — such as those imposed on Cuba and Russia — are prescribed by law, meaning that only Congress can permanently lift them. Given the current polarization of political views in Congress and the mutual constraints on the two sides of the conflict, if the president proposes to establish a peaceful relationship with a long-term opponent, it is unlikely that there will be enough votes in favor of the initiative to be adopted.
Even if this problem can be overcome, the legal jungle of sanctions is difficult to control. Some countries are subject to so many overlapping sanctions that they find themselves in a Kafka-esque situation, not knowing exactly what they can do to compromise.
It is so difficult to get the United States to lift sanctions on some countries, which complicates the United States' efforts to hold political consultations with all other countries. If sanctioned countries do not trust the U.S. government to roll back its coercive measures, they have no incentive to negotiate. If it doesn't work, what's the point of compromise with the United States? This is one of the reasons Saddam Hussein refused to negotiate with the United States in the 1990s, as well as Iran's refusal to negotiate with the Trump administration.
The sanctions have also caused humanitarian damage. Targeted financial sanctions, which are supposed to reduce the harm associated with a sweeping trade embargo, are based on the fact that sanctions on banking systems and assets held by bad actors do not affect the general population. In practice, however, most financial sanctions are imposed on the basis of trade sanctions, which are more damaging to the overall economy of the countries being sanctioned. Scholars of international relations disagree on many fronts, but the research literature on sanctions is consistent on the harm these measures have caused to the populations of the targeted countries. Even financial sanctions can trigger repression, corruption and the reversal of human development indicators.
Finally, sanctioned countries have learned to adapt to life under sanctions. For great powers like China and Russia, that means finding alternative trading partners; China's retaliation against the United States in the trade war has also reduced tariffs on European countries. Russia, in turn, sanctions European food imports to stimulate domestic production.
Sanctioned countries have also responded with retaliatory sanctions, leading to an escalation of policy conflicts that have increased spending for U.S. producers and consumers. This trend will only intensify as other major economies view U.S. sanctions ostensibly imposed for national security reasons as a cover for trade protectionism.
When the chief financial officer of the Chinese company Huawei was arrested in Canada and accused by the U.S. Justice Department of trying to evade U.S. sanctions on Iran, China saw the move as part of a larger trade war; when Trump informally suggested the executive's release in exchange for trade deals, he did not really help resolve the matter.
A more serious long-term concern about sanctions is that financial sanctions would weaken the dollar's position as the world's main reserve currency. It is precisely because of the prominence of the us dollar and the central position of the US capital market that financial sanctions have flourished in the first place. However, after a generation of sanctions, sanctioned countries are looking for alternatives to the dollar to protect themselves from coercion.
Digital currencies offer a way out. Chinese Bank has introduced a digital yuan that those who use it are able to bypass the dollar entirely. Even U.S. allies in Europe have developed the Pro-Trade Exchange Tool (INSTEX) to bypass the dollar and trade with Iran. So it's no surprise that the dollar's share of global foreign exchange reserves fell to a 25-year low at the end of 2020. For now, the US dollar remains the main global reserve currency. However, if the use of the dollar declines further, the power of the U.S. financial national policy will also decline.
U.S. sanctions have already achieved some significant success. But these sanctions have also alienated the United States from allies, impoverished people, and effectively promoted diversified monetary options away from the dollar, all of which have failed to make the sanctioned country take much practical concession.
Policymakers seem to confuse the power and effectiveness of sanctions. Just as generals mistakenly used the number of corpses as a measure of success when talking about the Vietnam War, policymakers now use the pain of sanctions as a measure of success. For example, in November 2020, U.S. Secretary of State Mike Pompeo called the maximum pressure campaign against Iran "exceptionally effective." As evidence, he noted that "Iran's economy is facing a currency crisis, with rising public debt and rising inflation." What Pompeo is not saying is that while under pressure economically, Iran is actually accelerating its nuclear development.
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