Thinking Aloud: “Sanctions as a Foreign Policy Tool: Helpful or Harmful?”

Mar. 2, 2015 by Darius

Last week, I attended a debate on “Sanctions as a Foreign Policy Tool: Helpful or Harmful?”  Arguing the case for sanctions was David Kramer of the McCain Institute for International Leadership (yes, that McCain); arguing against the use of sanctions was Bill Reinsch of the National Foreign Trade Council.  Perhaps surprisingly, the two were in agreement about many points.

Kramer first outlined what success means in terms of sanctions.  He said that sanctions “work” if they change the behavior of another government, obtain concrete results like the release of political prisoners, or, somewhat vaguely, deter future bad behavior by a government.  He cited sanctions against Belarus in 2007 and 2008 as a good example of success, as he believes the sanctions led directly to the release of political prisoners in Belarus.

Kramer also said that several other conditions need to be met for sanctions to work.  First, the target of the sanctions must think even more sanctions or punitive measures will follow if they do not change their behavior.  Second, the target must be provided with a roadmap of sorts: what specific things do they need to do for sanctions to be lifted?  Here as well, Kramer cited Belarus: the Belarusian government was told that sanctions would be lifted if certain political prisoners were released.  Days later, the prisoners were released.  Finally, Kramer said that sanctions cannot be the only tool used to change a government’s behavior.

Reinsch also spoke about the criteria for sanctions to work.  Citing academic research, Reinsch said that the smaller the target country and the smaller the desired goal, the greater the chance of success for sanctions.

However, Reinsch distinguished between several types of sanctions.  According to Reinsch, sanctions put in place by Congress are almost always inflexible, counterproductive, and difficult to unwind.  Congress takes a long time to act and is often more concerned with making a political point than constructively seeking to change behavior.  Additionally, Reinsch cautioned against the use of unilateral sanctions.  He considered unilateral sanctions to be a lose-lose for the US: if other countries are not on board as well, foreign companies will fill needs in the target country’s economy, effectively nullifying the pain of the sanctions.  US companies, previously doing business in the target country, are locked out and lose revenue.  As a result, the US economy suffers, and the sanctions are ineffective.

Reinsch also discussed the rather recent phenomenon of individual US states applying their own sanctions.  From a business perspective, individual state sanctions are a major headache.  Maintaining compliance with national sanctions alone is difficult and costly.  So far, 28 states have enacted sanctions in some form.  These laws vary greatly from state by state, and in some cases, companies are in violation of one state or another’s laws no matter what they do.  Individual state sanctions have been repeatedly ruled unconstitutional by the Supreme Court, but states continue passing new sanctions.

Though the panelists made some good points, I felt the discussion was not all it could have been.  Reinsch’s comments made it quite clear that sanctions are bad for US businesses, but he didn’t broaden his remarks past the cost to US businesses.  For instance, he did not address whether or not the economic sacrifice might be necessary or worth it in some cases.  Kramer, for his part, seemed obsessed with the need for sanctions on Russia and Vladimir Putin.  He didn’t discuss, or seem to know much about, past use of sanctions aside from his Belarus example.

Sanctions are almost always imposed from a position of weakness: diplomacy has failed but armed conflict is not desirable.  Sanctions are perceived as an in-between step, but are they effective or just political theater?  (One statistic cited during the Q&A was that sanctions succeeded, by whatever definition was being used for success, only about 15 times out of 100.)  What this discussion really needed was a thorough analysis of some of the more and less well-known uses of sanctions in recent history.  Did they achieve their goals?  Were sanctions, in fact, the cause for a change in behavior?  What were their exact costs to businesses?  How were they paired with other foreign policy initiatives?  Unfortunately, neither of the speakers at this event had the knowledge to have this discussion.

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