Feb 19, 2020
President Trump’s signature foreign policy initiatives often bear the same hallmarks: economic coercion to extract maximalist concessions. From Iran to North Korea to Venezuela, the use of sanctions, normally a tactic employed as part of a broader strategy, have turned into a strategy unto themselves. Far from realizing the self-proclaimed goals of the Trump administration, the excessive use of sanctions has made them harder to achieve, caused immense human suffering, and risks the ability of future administrations to use sanctions as a tool in the foreign policy playbook.
Supporters of the Trump strategy tout the success that sanctions have had in crippling a country’s economy and inflicting economic pain as proof the policy is working. But evaluating the success of the strategy requires looking at the outcomes judged against its goals.
None of the goals of the three main “maximum pressure” campaigns the Trump administration has waged (Iran, North Korea, and Venezuela) have been met. We were told the “maximum pressure” campaigns would yield a comprehensive nuclear deal that included Iran abandoning its regional strategy, North Korea giving up its nuclear weapons, and Venezuelan President Nicolas Maduro stepping down. Instead, Iran is closer to a nuclear weapon than it was the day President Trump took office, North Korea’s nuclear weapons stockpile has increased, and Maduro is as entrenched in power as he was the day Trump recognized opposition leader Juan Guaido.
In addition to not achieving its objectives, the Trump administration’s “maximum pressure” strategy may actually be making its goals even harder to reach. Instead of following the example of the Obama administration and providing a clear understanding of what was required for sanctions to be lifted during the Iran nuclear deal negotiations, the Trump administration has compiled a list of demands, which are tantamount to regime change, that must be met before lifting sanctions. The Obama blueprint made the Iran nuclear negotiations a successful framework going forward: economic pressure that would be lifted in a negotiated agreement. But the Trump administration’s abandonment of that strategy, which is echoed in its demands of Venezuela and North Korea, is not rooted in any reasonable or attainable tradeoffs. All of these countries’ leaders are now further entrenched, which is eerily similar to another historical example.
Cuba, a country that experienced coercive economic measures that hindered its development for half a century, had the same revolutionary leaders until Raul Castro finally ceded leadership to a handpicked successor. Instead of dislodging the leadership of that country, the American embargo created a cult of personality around the Castros, and let them blame the United States for their lack of economic development. We’re seeing similar results now in Venezuela and Iran, whose leaders blame the United States for their dire economies, allowing them to stoke national pride in direct opposition to U.S. “imperialism.”
As in Cuba, the leadership of North Korea, Iran, and Venezuela is now further entrenched as a result of U.S. policies. When a revolutionary leadership of a country relies on anti-Americanism for their legitimacy, and when sanctions threaten that legitimacy, they will resist to the fullest extent possible and quash dissent, usually with violence. And instead of fomenting rebellion against autocratic leaders, the “maximum pressure” campaigns are hurting the people Trump administration officials claim they want to support.
The humanitarian crises in Venezuela and North Korea are well documented. And while humanitarian aid and medicine are not directly affected by sanctions, the chilling effect sanctions have on banks makes purchasing and importing medicine into these countries difficult, if not impossible. This causes underserved and struggling populations to struggle even more. Reports indicate that up to 4,000 people have died in North Korea due to U.S. sanctions, and a recent Human Rights Watch report indicated that shortages of medicine in Iran are attributable to the “maximum pressure” campaign. Such shortages are leading to deadly consequences. Even worse, a U.S. non-profit humanitarian organization, the American Friends Services Committee, was targeted in sanctions investigations, meaning that instead of spending its limited funds on humanitarian programs, it had to spend that money on lawyers. Organizations like these could form the basis for mutual understanding and improve the view of the United States in the eyes of the people of these countries, but instead service-providing organizations are hamstrung by sanctions.
Inflicting pain on the populations is likely to breed resentment and allow for leaders to scapegoat the United States for the suffering of its people. The use of sectoral sanctions, such as sanctioning Iran’s oil exports or North Korean textile and coal exports, ends up hurting the working- and middle-class communities the Trump administration professes to care about. Strangling economies rarely impacts the elites, who tend to rely on corrupt means and the circumvention of traditional financial mechanisms to enrich themselves. Sanctions regimes end up punishing the populations for the sake of punishment. Not only does the impact of sanctions undermine the message the United States is trying to send, but the excessive use of unilateral sanctions may also affect the usefulness of this tool in the future.
The ability of the United States to exact devastating economic tolls is unquestioned. The supremacy of U.S. dollar makes sanctions an attractive tool of statecraft, and has been used to bend the world to U.S. demands. However, the overuse of coercive economic tools, especially when used to threaten partners and allies with secondary sanctions, risks incentivizing the rest of the world to find ways around these sanctions. Successful sanctions regimes are based on preventing countries from using the U.S. financial system, which underwrites the global economy. But efforts to circumvent the U.S. financial system are already underway.
The implementation of INSTEX, the financial system Europe set up to facilitate trade with Iran, hasn’t been smooth, but its existence shows that the world is growing wary of the way the United States has exerted economic pressure. As the Center for New American Security’s Elizabeth Rosenberg and Peter Harrell note in their report on the future of U.S. economic coercion, Russia and China are already setting up financial mechanisms to circumvent U.S. sanctions. These systems do not necessarily pose a near term threat to U.S. financial hegemony, but the trends show that there may be cracks in the U.S. domination of the global financial system that, if not managed adeptly, could spell disaster for the effectiveness of U.S. sanctions in the future. As the “maximum pressure” campaigns continue, it’s becoming more and more evident that the risks clearly outweigh the rewards.
The U.S. over-reliance on sanctions as an instrument of statecraft needs to be rethought, and it begins with understanding the failures of the Trump administration’s “maximum pressure” campaigns. A policy that only causes pain without achieving any of its stated goals hurts U.S. interests. It entrenches adversarial leaders, breeds resentment by inflicting pain on the populations, and risks the utility of U.S. sanctions in the future. The failures of the Trump administration’s “maximum pressure” campaigns should make future decision makers align their goals to their means, and rethink using sanctions as an instrument for every foreign policy initiative.
