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Economic Sanctions and Post-Cold War Conflicts: Challenges for Theory and Policy
Economic Sanctions and Post-Cold War Conflicts: Challenges for Theory and Policy
Pages 123-177
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From page 123... ...
Traditionalists see little efficacy in sanctions. "It would be difficult to find any proposition in the international relations literature more widely accepted," as David Baldwin puts it in his critique of the traditionalists, "than those belittling the utility of economic techniques of statecraft." Among the works Baldwin cites are studies by Henry Bienen and Robert Gilpin, who accept "the nearly unanimous conclusion of scholars that sanctions seldom achieve their purposes and more likely have severe counterproductive consequences"; Charles Kindleberger, that "most sanctions are not effective"; Klaus Knorr, on their "uncertain effectiveness and decidedly low utility when used for purposes of coercing other states"; Margaret Doxey, that "in none of the cases analyzed in this study have economic sanctions succeeded in producing the desired political result"; Johan Galtung, that "the probable effectiveness of economic sanctions is, generally, negative"; and Donald Losman, that the cases he studied "failed to accomplish their political ends, and it seems unlikely that economic 123
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From page 124... ...
have demonstrated considerable power"; and Elizabeth Rogers, that "economic sanctions are more effective than most analysts suggest."3 Perhaps the best example of the inconclusiveness over sanctions is the study Economic Sanctions Reconsidered (by Gary Hufbauer, Jeffrey Schott, and Kimberly Ann Elliott; hereafter referred to as the HSE study) , which is cited by both traditionalists and revisionists as supporting their arguments.4 Revisionists hail the 34 percent success rate in the HSE study as higher than traditionalists claimed, while traditionalists raise methodological issues about the validity of the 34 percent rate and question, even if it is valid, just how impressive it is.
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From page 125... ...
Three major empirical patterns are identified: the increased frequency with which sanctions are being used, the increased economic impact they are having, and their mixed record of policy success and failure. The central dynamic is what I term the "vulnerability-viability" paradox of shifts in the post-Cold War political economy both conducive and counter to sanctions' efficacy, heightening target state vulnerability on the one hand but making the political viability of sanctions more problematic on the other.
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From page 126... ...
that the objective is impact on noneconomic policy, such as foreign policy behavior or domestic politics, but excluding trade disputes and other economic bargaining objectives. As such this is a narrower definition than some, such as Baldwin's "economic statecraft," which holds to element b but by including positive inducements among the instruments and trade and other economic bargaining cases among the objectives not to elements a or c.~° On the other hand, it is broader in its scope of objectives than those, such as Pape's, that principally focus on whether sanctions can achieve the same goals as military force.
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From page 127... ...
The principal distinctions are among three different purposes: containment, limiting the target state's military and other relevant capabilities so as to constrain its capacity for causing conflicts; antiaggression, deterring or compelling the target state to refrain from or cease military or other aggressive actions; and domestic political influence, coercing change in the target state's domestic politics or policies. The subdistinctions in each of these between limited and extensive objectives are consistent with the more general literature about the need for proportionality between means and ends.~4 Containing a target's military capabilities is a more limited objective than broader economic warfare; coercing change in aggressive policies such as terrorism or proliferation of weapons of mass destruction is more limited than deterring it from launching or compelling it to end a war or invasion; pressuring for democratization or protecting human rights is more limited than forcing a change in the .
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From page 128... ...
Dependent Variable Measurement: Assessing Policy Outcomes Consistent with the HSE approach we can cast the dependent variable as a measurement of the extent to which the sender achieves its objectives at an acceptable cost. The operationalization of such terms, though, in a methodologically sound manner is more complicated than their 1 to 4 ordinal scale depicts.
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From page 129... ...
However, they also can be not just nonpositive but also net negative in terms of the costs they end up carrying in one or more of four respects: backfiring and having a politically integrative effect strengthening the will of an embattled people to resist; misfiring and inflicting a humanitarian crisis on the civilian populace, making the "civilian pain" much greater than any "political gain"; cross-firing, straining relations with key allies; and shooting in the foot with high self-inflicted costs. The argument that costs incurred can actually have a beneficial effect as a show of resolve is often made.~7 It is said to be part of U.S.
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From page 130... ...
Sensitivity to reaching falsely negative conclusions and keeping analytically open to the possibility that sanctions may have worked had they been done right, whether in themselves or as they fit into an overall foreign policy strategy, is a no less crucial consideration for drawing appropriate policy lessons from certain failure cases than is caution about reaching premature analytical closure around a false positive. I come back to this point later with regard to some key post-Cold War cases.
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From page 131... ...
Even taking the HSE study's 34 percent success rate on its face, there are differing views of whether it meets expectations. Elizabeth Rogers sees it as "respectable" compared to other coercive foreign policy strategies, such as military intervention and covert action.23 Others, though, see a one in three success rate for a strategy that carries such significant costs as much less acceptable.
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From page 132... ...
sanctions against the Dominican Republic and the 1987-1989 sanctions against Panama is an example of greater political influence in the case with lesser, albeit still significant, economic impact.26 It stands to reason, though, that if a target state has to take into account significant economic impact, whether felt or anticipated, this will affect its political decisions. In addition, beyond the immediate material impact of sanctions, political credibility comes into play as a matter of conveying a strong sense of the sender state's will and capacity to do what is necessary to gain compliance.
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From page 133... ...
The message of resolve is much less credible if other states, especially allies, do not show solidarity.29 Multilateral cooperation on sanctions can be achieved in three ways: shared interests, sender state leverage, and institutionalized cooperation. "Identity of interests," as the old adage from Thucydides has it, "is the surest of bonds, whether between states or individuals."30 The surest of bonds, perhaps, but not the most common, not even among Cold War allies, as was evident in the 1981-1983 Siberian gas pipeline case with the major intraalliance differences and disputes stemming from divergences between the United States and key Western European allies over both the economic interests at stake and divergent foreign policy strategies for relations with the Soviet Unionist In this and other cases sender states resorted to imposition of secondary sanctions, claims of extraterritoriality, and other modes of leverage seeking to coerce cooperation.
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From page 134... ...
While conflicts did occur within COCOM, going back even to the 1950s, for the most part the norms, procedures, and structures established through COCOM provided the basis for managing these differences and maintaining prevailing Western multilateral cooperation, including in some instances by the United States making compromises with an eye to sustaining COCOM.34 The United Nations played a very limited role in sanctions prior to the post-Cold War era. It is vested by its charter with sanctions authority: if the UN Security Council determines under Article 39 the "existence of any threat to the peace, breach of the peace, or act of aggression," under Article 41 it can authorize "complete or partial interruption of economic relations" and under Article 42 it can enforce these through "such action by air, sea or land forces as may be necessary." But the UN only used this authority twice during the Cold War era in 1966 for comprehensive sanctions against Rhodesia following the white minority regime's unilateral declaration of independence and in 1979 for an arms embargo against South Africa.
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From page 135... ...
The other aspect of target state self-defense against sanctions is the relative political will it can muster to bear whatever costs are imposed and thus block any significant conversion of economic impact to political influence. It is in this regard that the political effects in fact often end up backfiring.
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From page 136... ...
This may be a general macroeconomic internationalization or it may be more particularistic; the latter is what financial assets freezes and other sanctions targeted at the financial sector in part are intended to get at. However, if target state elites are not substantially engaged in the international economy, be it through trade or investment or finance, they are less likely to have enough to lose to spur them to bring pressure on their government.
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From page 137... ...
While there is some logic to this it does not generalize to countersanctions and claims of extraterritoriality, which as in the U.S.-European relationship consistently touch a nerve. Sender State's Domestic Constraints The third dimension to the political economy of sanctions gets at the sender state's motivations.
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From page 138... ...
Chamber of Commerce urged that the United States "set aside the emotions of the moment" and ponder the economic costs of sanctions. The U.S.-Iraq Business Forum, whose member companies included major oil companies and other Fortune 500 companies, asserted that while "morality is an essential ingredient in foreign policy in a democratic society .
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From page 139... ...
Because the antiaggression and domestic political influence objectives require not only affecting capabilities but also influencing policy behavior, their success requires both having economic impact and converting that impact into political influence. This makes them more reliant on the transmission belts in the target state by which economic denial is converted into policy or political change.
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From page 140... ...
Three factors explain this greater efficacy: (1) greater target state vulnerability because of the limited domestic substitution capacity for foreign capital; (2)
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From page 141... ...
One relates to questions of credibility and whether the broader policy context leads the target state to perceive sanctions as either a step away from or a step toward the use of military force. The sign-of-weakness perception is risked when sanctions come out of a policy debate that expresses doubts about if not rejection of more coercive measures; the sign-of-resolve perception is more likely when sanctions are arrived at perhaps as a first step and within a broader policy message of other tougher steps likely to follow if there is no compliance.
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1990 Suriname Netherlands Domestic political influence (regime change) 1990 Zaire U.S., KU, Belgium Domestic political influence (human rights)
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Antiaggression (proliferation) 1994 Albania Greece Domestic political influence (human rights)
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1996 Burundi East African Domestic political influence nations (regime change) 1996 Turkey EU Domestic political influence (human rights)
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opposition has also come from the general foreign policy community. While the antisanctions forces have been gaining some ground and the dynamic has begun to shift, the prosanctions forces have tended to dominate thus far.
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From page 146... ...
in the original HSE study was less than 2 percent and only 2.4 percent in HSE's success cases, double-digit effects are seen in a number of post-Cold War cases, much of which remains attributable to sanctions even taking into account selfinduced factors such as corruption and internal inefficiencies. For example, in Iraq the original 1990 sanctions had the immediate effect of cutting off 97 percent of Iraqi oil exports and over 90 percent of its imports and caused a 40 percent decline in civilian production.55 Later, in the initial aftermath of the 1991 Gulf War, there was a miniboom as Saddam Hussein drew on accumulated stocks of industrial equipment, hidden cash reserves, materials stolen from Kuwait, and smuggling and transshipment routes through then-ally Jordan.
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From page 147... ...
more difficult, which in turn made foreign investors and creditors more wary of providing new capital.59 This has begun to change in recent years for a number of reasons, notably the improved outlooks in the oil and gas sector, the political and economic reforms initiated since 1997 by President Mohamed Khatemi, and the increased willingness of European and other governments and companies to buck U.S. efforts to claim extraterritoriality and impose secondary sanctions.
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From page 148... ...
The number of cases in which sanctions have caused or contributed to major humanitarian crises for the civilians in a target state bearing the brunt of the economic impact, and that economic impact being so severe as to push living standards below (in some cases further below) subsistence levels, is unprecedented.
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From page 149... ...
The other misfired economic impact has been the high collateral costs borne by third-party front-line states deprived of their natural trade partners. The lost revenues to Turkey from pipeline transit charges on Iraqi oil and other trade have been estimated at $20 billion.
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From page 150... ...
The sanctions as first established by UN Security Council Resolutions 661 and 665 did have value as an immediate response to Saddam's invasion and one expressing the broadest possible multilateral support. But the extent of the foreign policy influence objective of compelling Saddam to withdraw from Kuwait was disproportionate to the limited instrument that even comprehensive and UN-mandated multilateral sanctions constituted.
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From page 151... ...
While claims of success also are made for the foreign policy objective of limiting Saddam's regional influence the helping "keep Saddam in the box" contention made by the Clinton administration this too is time sensitive. Over time Russia, France, Turkey, and some Arab states, including Egypt, have been pushing harder for lifting many of the sanctions and for an overall shift to a less coercive and more cooperative strategy.
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From page 152... ...
policy toward Iran has prevented Teheran from becoming more of a threat than it now is."70 For the broader economic containment and foreign policy influence the United States has sought, there has been much less success, largely because of limited multilateral cooperation. When it comes to oil and gas, there is a fundamental divergence of interests between the United States on one side and Europe and lapan on the other.
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From page 153... ...
Susan Woodward and Sonja Licht are among those who see sanctions as having been more negative than positive all along because of their unintended impact of reinforcing Milosevic's political ideology as well as the economic position of his state apparatus in allocating scarce goods while weakening and demoralizing the opposition.7~ On the other hand, others see a discernible pattern in Milosevic's actions of responding to sanctions when they were seriously applied but reverting and deviating when he could. David Owen, the former British foreign minister who was one of the lead international negotiators in 1993-1994, writes that, "I had no doubt then, and never have doubted since that it was the prospect of financial sanctions which Milosevic most feared: the chance of avoiding any further economic misery was too attractive domestically for him to go on humoring Karadzic as he obstructed virtually any deal."72 General Rupert Smith, commander of the UN peacekeeping troops in Bosnia, made a similar point, that Milosevic's shift to greater willingness to enforce the sanctions against the Bosnian Serbs as he was supposed to, substantially weakened Karadzic.73 Haiti: Failure, But a False Negative7 There is no disagreement about the Haiti sanctions having failed.
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From page 154... ...
He predicted a 60 percent chance that the sanctions would achieve their objective of bringing Aristide back to power within just two months.74 Yet six months into the sanctions exemptions were granted for American-owned assembly plants. "The mood of optimism among many who supported the coup," The New York Times reported at the time, "turned to bravado and frankly expressed glee."75 Moreover, in accommodating its own economic interests the United States weakened its standing for leaning on the Europeans or Latin Americans.
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From page 155... ...
Whatever threads of credibility may have been left were stripped bare when under domestic political pressure the United States waived its agricultural sanctions against India. Political Economy of Post-Cold War Sanctions and the 'Vulnerability-Viability" Paradox Other cases also could have been cited and also would have fallen short of definitively substantiating either the sanctions-don't-work or yesthey-do schools.
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From page 156... ...
."79 Second is the strategic context of the end of bipolarity. While alternative trade partners still can be a significant factor, absent the geopolitical incentives of the Cold War, it is much more difficult for target states to find a protector, as Tito's Yugoslavia was able to get from the West and Castro's Cuba from the Soviet Union.
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From page 157... ...
One does not have to become a democratic triumphalist, with the attendant underestimations of the instabilities and uncertainties that the institutionalization of democracy will continue to face for a long time to come to acknowledge the trend in this direction.~° The effect of this trend combined with the economic globalization one is that more groups in target states have interests at risk to sanctions, and these groups are more likely to be in a position to transmit their concerns about those interests in a politically meaningful way. The Guatemala 1993 and Paraguay 1996 cases provide examples.
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From page 158... ...
Moreover, there are more and more countries that, thanks to the diffusion of technology and capital that have come with economic globalization, are in a position to act as alternative trade partners. They may not be able to totally replace the United States or other major industrial countries, but they can assuage some of the economic impact.
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From page 159... ...
The boomerang effect of sanctions setting off politically integrative reactions also remains possible in a number of political systems, especially when the sanctions have domestic political influence objectives and are imposed overtly and "loudly." It is in large part because of this vulnerability-viability paradox and the ways in which both proponents and opponents of sanctions can argue that the post-Cold War political economy favors their positions that sanctions are more politically contentious than they have ever been. In the past there were specific case controversies, like over the 1980 Soviet grain embargo.
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From page 160... ...
Issues like relations with Iran or how best to facilitate a democratic transition in Cuba do not have consensual answers, and politics aside there is room for serious policy debate. So too with human rights and other issues that raise difficult questions about tradeoffs and prioritization between values and other interests.87 We "don't want to make the gross national product the be-all and end-all of American foreign policy and trade relationships," stated one Christian right leader.
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From page 161... ...
Post-Cold War Political Economy of Sanctions: "Mini-Maxing" the Vulnerability-Viability Paradox The crucial change giving sanctions more potential efficacy than before is the heightened vulnerability of target states especially to the economic impact of sanctions and also, albeit with some exceptions, to the political conversion of that economic impact. But the concomitant increase in problems of political viability constrains the capacity to actualize this potential.
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From page 162... ...
In particular it would recognize that cooperation is least likely when sanctions are largely externalizations of American domestic politics in the garb of security or foreign policy concerns and/or when the means of leverage are secondary sanctions based on claims of extraterritoriality. We have seen that these types of and approach to sanctions have a long history of being highly contentious within the Western alliance.
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From page 163... ...
It would indeed be unrealistic to ignore the differences of interests that are inherent to the mix of cooperation and rivalry in these post-Cold War relationships. The target states with which the United States is most concerned regarding proliferation and military capabilities generally Iran and Iraq, Pakistan and India are states with which Russia and China have their own strong geopolitical interests to pursue, both viz their respective rivalries with the United States and with each other.
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From page 164... ...
Sanctions against regimes like Saddam Hussein's in Iraq will continue to be limited in the impact they can have especially for foreign policy influence and domestic political change objectives. Yet the range of states so excluded from the reach of sanctions has been diminishing.
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From page 165... ...
Unilateral sanctions may convey isolation and disunity rather than resolve. To the extent that the United States or any other sender state is constrained by domestic political pressures from imposing sanctions, it risks being saddled with the "bluffer's dilemma." For when, as Bruce Russell and Harvey Starr argue in a more general context, a government is prevented "from pursuing certain policies or using certain capabilities, the credibility of that government declines in the eyes of other states.
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From page 166... ...
In many cases seeking domestic political influence, universal multilateral cooperation may not be necessary. Even if some trade seeps in, so long as the sanctions coalition includes the states that are the target's principal trading partners and that politically are
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From page 167... ...
But Russia and China play larger roles. Ultimately, the objective is to prevent the target state from acquiring certain military capabilities.
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From page 168... ...
To be sure, the main question posed is political: if it is so difficult to get multilateral cooperation with limited sanctions, how could cooperation be expected with comprehensive ones? But there is an argument to be made that the economic costs to sanctioning states may actually be less, not more.
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From page 169... ...
Broader Policy Context Finally, as to the broader policy context the point here remains what has been emphasized throughout. To the extent that sanctions are seen as a means for evading tougher action in a conflict situation that requires it, their chances for success are reduced substantially.
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From page 170... ...
The use of economic sanctions for international conflict resolution in the postCold War era is both difficult and necessary. Heightened target state vulnerability creates opportunities, while more problematic political vi
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From page 171... ...
55-57. See also Henry Bienen and Robert Gilpin, "An Evaluation of the Use of Economic Sanctions to Promote Foreign Policy Objectives, with Special Reference to the Problem of Terrorism and the Promotion of Human Rights," a report prepared for the Boeing Corporation, April 2, 1979; Charles P
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From page 172... ...
Foreign Policy: Implications of Case Studies from the Johnson Administration (Boulder, Colo.: Westview Press, 1982~] ; instrumental, symbolic-expressive [Johan Galtung, "On the Effects of International Sanctions, with Examples from the Case of Rhodesia," World Politics, 19 (April 1967~]
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From page 173... ...
Jentleson, Pipeline Politics: The Complex Political Economy of East-West Energy Trade (Ithaca, N.Y.: Cornell University Press, 1986~. 32While "my heart is completely with the iron and steel industry," as West German Foreign Minister Gerhard Schroeder put it, "I must choose here between the interests of foreign policy and the interests of our economy" Jentleson, Pipeline Politics, p.
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From page 174... ...
33~. 410n the internal opposition effect, see Ivan Eland, "Economic Sanctions as Tools of Foreign Policy," in Cortright and Lopez, Economic Sanctions: Panacea or Peacebuilding?
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From page 175... ...
Unilateral Economic Sanctions for Foreign Policy Purposes, 1993-1996 (Washington, D.C.: NAM, 1997~; President's Export Council, "Unilateral Economic Sanctions: A Review of Existing Sanctions and Their Impacts on U.S. Economic Interests with Recommendations for Policy and Process Improvements," June 1997 (mimeograph)
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From page 176... ...
45. 65Eric Hoskins, "The Humanitarian Impact of Economic Sanctions and War in Iraq," in Weiss et al., Political Gain and Civilian Pain; Barbara Crossette, "UNICEF Head Says Thousands of Children Are Dying in Iraq," New York Times, October 29, 1996, p.
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From page 177... ...
Unilateral Economic Sanctions; President's Export Council, "Unilateral Economic Sanctions"; Mobil Oil Company, "Sanctions: Our Perspective," New York Times, September 16,1997. 92Bruce Russett and Harvey Starr, World Politics: The Menu for Choice (San Francisco: Freeman, 1981)
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