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Economic Sanctions Programs

Economic sanctions have become a go-to foreign policy tool for many countries, including the United States. They involve restricting trade and financial transactions with a target country in order to pressure them politically or economically. But how effective are sanctions really? And what are the ethical implications of using policies that often harm regular citizens more than governments?

What are economic sanctions?

Economic sanctions are policies that restrict trade and financial flows to a target country. They aim to change the behavior of the target, such as compelling them to improve human rights or deterring them from developing nuclear weapons. Common types of sanctions include:

• Trade sanctions – limiting or banning exports and/or imports
• Financial sanctions – freezing assets, limiting access to loans and foreign investment
• Travel sanctions – restricting visas and travel
• Diplomatic sanctions – reducing diplomatic ties and political engagement

Sanctions can be imposed unilaterally by one country, or multilaterally through international organizations like the United Nations. The United States uses sanctions more than any other country, often applying them unilaterally without broad international support.

History and evolution of sanctions

The use of economic sanctions dates back centuries, but became more prominent in the 20th century. The 1917 Trading with the Enemy Act gave the U.S. president broad powers to restrict trade during wartime. This was later expanded for peacetime use as well^[1].

During the Cold War era, the U.S. used sanctions as a foreign policy tool against communist states. The goals were often strategic – containing the Soviet Union – rather than focused on improving human rights. Major sanctions programs were imposed on Cuba, China, the Soviet Union and Vietnam^[2].

After the Cold War ended, sanctions were increasingly used to promote human rights and democracy. But unilateral U.S. sanctions continued to pursue strategic interests as well. There were critiques that sanctions were ineffective and better policy coordination was needed^[3].

In the 21st century, sanctions have expanded in scope and frequency. The U.S. has imposed aggressive sanctions on Iran, North Korea, Syria, Venezuela, and Russia. New types of financial sanctions target oligarchs, banks and entire economic sectors. Sanctions are often enacted quickly via executive orders and applied extraterritorially^[4][5].

Effectiveness and consequences

There is extensive debate about whether sanctions are an effective foreign policy tool. Some key considerations:

• Sanctions often fail to achieve their goals – In many cases, from Cuba to Iraq, sanctions have inflicted economic damage without compelling policy changes from the target.
• Sanctions harm civilians – Cutting off trade and financing disproportionately harms regular citizens by causing unemployment, shortages, inflation and reduced access to medicines.
• Sanctions entrench leaders – Sanctions can undermine moderates and empower authoritarian leaders by enabling them to rally citizens against a foreign threat.
• Sanctions can be circumvented – Black markets and alternative financing from countries like China and Russia allow targets to bypass sanctions.
• Multilateral sanctions are more effective – When imposed multilaterally through the UN, sanctions are more likely to isolate the target and compel changes.
• Sanctions work best as threats – The threat of imposing sanctions can sometimes achieve results without actual implementation.
• Limited sanctions can work – Narrowly targeted sanctions on individuals or sectors are less damaging than broad trade and financial sanctions.

Overall, most experts believe sanctions should be used judiciously in limited situations, not as a blanket policy against adversarial nations. They are rarely decisive on their own, but can contribute to achieving foreign policy goals when combined with diplomatic engagement^[6].

Case study: Russia sanctions over Ukraine

In response to Russia’s invasion of Ukraine in 2022, the U.S., EU and allies imposed sweeping sanctions on Russia’s economy and oligarchs. Key measures included:

• Banning Russian oil and gas imports
• Freezing assets of Russia’s central bank
• Cutting off major Russian banks from SWIFT financial system
• Travel bans and asset freezes on oligarchs
• Banning export of advanced technologies to Russia

These sanctions aim to pressure Russia diplomatically, cripple its economy, and reduce resources for the war. But Russia has managed to stabilize its economy with high oil/gas prices and alternative markets. The ruble has recovered and inflation has eased. Daily life in Russia has some shortages but economic collapse has not occurred. Meanwhile, European countries face energy cost spikes and disruptions.

The sanctions likely deterred a full scale invasion of Ukraine but have not compelled Russia’s withdrawal. Their long-term effectiveness remains uncertain. Most experts believe negotiated settlement will ultimately be needed to end the war.

Ethics of sanctions policies

Sanctions raise several ethical concerns, given the harm they often inflict on innocent populations:

• They can cause humanitarian crises, food/medicine shortages, and increased poverty.
• Children, the elderly and poor suffer most from rising prices, lost jobs and reduced social spending.
• Elites with overseas assets are often untouched while regular people pay the price.
• In Iraq in the 1990s, sanctions contributed to the deaths of hundreds of thousands of children.

Some ethicists argue sanctions that collectively punish populations are unethical except in extreme cases like genocide. Others contend collateral damage is justified against authoritarian regimes. But there are ways to mitigate humanitarian impact:

• Allow food, agricultural, and medical trade to continue
• Provide aid to impacted populations
• Allow humanitarian exemptions and oversight
• Avoid comprehensive trade sanctions when possible

More targeted sanctions on leaders, oligarchs and security forces can pressure regimes while sparing civilians. But narrow sanctions are often less effective at achieving political goals.

The future of economic sanctions

Sanctions will remain a key foreign policy tool given their flexibility and low cost compared to military options. Some ways sanctions could evolve include:

• Increased use of “smart sanctions” targeting individuals/sectors rather than whole economies
• Expanded extraterritorial sanctions reach as global trade grows
• Use of sanctions to enforce human rights and environmental standards
• Greater coordination between Western countries to align sanctions
• More reliance on sanctions threats over implementation when possible
• Efforts to reduce humanitarian impacts and allow aid flows

Overall, economic sanctions present dilemmas between ethics, effectiveness, and national interests. As sanctions proliferate, policymakers should carefully weigh their goals against potential consequences. While sometimes necessary, sanctions are rarely a standalone solution. Diplomacy, incentives, and engagement are also needed to resolve conflicts and promote lasting change.

References

[1] Coates, Benjamin A. “The Secret Life of Statutes: A Century of the Trading With the Enemy Act.” Modern American History. 1, no. 2 (2018): 151-172.

[2] Gordon, Joy. Invisible War: The United States and the Iraq Sanctions. Harvard University Press, 2012.

[3] Cortright, David, and George Lopez. The Sanctions Decade: Assessing UN Strategies in the 1990s. Lynne Rienner Publishers, 2000.

[4] Nephew, Richard. The Art of Sanctions: A View from the Field. Columbia University Press, 2018.

[5] Early, Bryan R. Busted Sanctions: Explaining Why Economic Sanctions Fail. Stanford University Press, 2015.

[6] Pape, Robert. “Why Economic Sanctions Do Not Work.” International Security 22, no. 2 (1997): 90-136.

Connolly, Richard. “The Economic Effects of the Russia Sanctions.” RUSI, October 2022. https://rusi.org/explore-our-research/publications/commentary/economic-effects-russia-sanctions

Leonard, Mark, et al. “Squeeze Russia’s economy, not European consumers.” Politico, November 2022. https://www.politico.eu/article/how-to-squeeze-russias-economy-not-european-consumers/

Gordon, Joy. “Smart Sanctions Revisited.” Ethics & International Affairs 25, no. 3 (2011): 315-335.