Sanctions and the Symphony of Power: Revitalizing American Economic Statecraft
By Dr. Daniel McDowell, Dr. Daniel Drezner, Yaya Fanusie, Samantha Custer, Dr. Audrye Wong, Edward Fishman, and Dr. Will Norris (Drezner is Professor of International Politics at The Fletcher School)
The United States has come to rely heavily on economic sanctions as a means of punishing and altering the behavior of foreign states and non-state entities, as well as individuals. The modern use of sanctions as a tool of coercion “short of war” dates to the early twentieth century, but the U.S. increasingly turned to nancial sanctions after 9/11 to asphyxiate terrorist networks and to confront hostile states. The U.S.’s track record in using economic coercion has been mixed. Sanctions can be powerful tools in advancing U.S. foreign goals—from unraveling South Africa’s apartheid regime in the early 1990s to imposing costs on adversaries. But U.S. sanctions have also fallen conspicuously short of their declared aims, such as those placed on Cuba, North Korea, Venezuela, as well as Russia after its takeover of Crimea in 2014.
The United States has been described as “the only sanctions superpower,” but it has consistently employed these powers in a strategy-free fashion. Despite the intelligence-driven modernization of our sanctions instruments, U.S. sanctions are criticized as convoluted, too expensive to monitor and implement, inexible, and rarely grounded in realistically attainable policy objectives. In government, coercive economic actions have been poorly coordinated across the interagency and thus with the U.S.’s other instruments of power—economic, diplomatic, and military. Sanctions and other crucial tools of American economic statecraft are also poorly coordinated with the U.S. business sector and with our foreign allies and partners.
Meanwhile, the targets and potential targets of U.S. sanctions have been developing sophisticated workarounds aimed at blunting the effects of economic coercion. These circumvention strategies have, among other things, contributed to the development of alternative and de-dollarized nancial networks. These trends risk undermining the efcacy of sanctions. They also present novel challenges to the open and accountable rules-based international economic order which the U.S. has sponsored since 1945 as a means of promoting peaceful cooperation and prosperity among nations. The United States today faces the most perilous international situation since the Second World War. Economics—and America’s stewardship, in cooperation with allies and partners, of the open international order—will be determinative in any Great Power competition to come. The dangerous situation facing the U.S. requires us to take a hard look and to reinvest in the full range of national power—particularly tools of economic statecraft.
This research volume was curated for Gates Forum 3, which is addressed to sanctions and American economic statecraft. The authors in this volume have prepared topline summaries of their essays which are included in this integrative report. Our contributors explore the sources of American nancial power, U.S. sanctions track records, the novel challenges facing U.S. economic statecraft, and the need for improved integration of sanctions with the U.S.’s other national security instruments. The papers also raise many foundational questions for policymakers to consider: What is the purpose of sanctions—what is it that we are trying to achieve? How can the U.S. enhance the efcacy of sanctions— while limiting their overuse and unintended consequences? How can the U.S. improve the coordination of economic statecraft across the interagency, between government and the American private sector, as well as with our allies and partners? In today’s dangerous and troubled world, the U.S. will need to reinvest in its economic statecraft toolkit—that is, its capacity to be good defenders of, contributors to and stewards of the open, innovative, and accountable international economic order. This integrative summary concludes with some questions and areas for action which Gates Forum conferees may wish to consider.
Read the full research volume here.
(This post is republished from the Gates Forum III Conference Reference Materials.)