Day: January 29, 2020
Stevenson’s army, January 29
– President Trump unveiled his vision for Arab-Israeli peace. NYT says the Arab reaction was “muted.”
The only money figure I noted was “$50 billion” in “investment” in Palestinian territories, presumably only from Muslim nations. The Netanyahu government plans to seize the moment by annexing territories the Trump plan would allow.
– CNAS has a new report on how to deal with China, commissioned by Congress. It tracks the proposals by CFR and others. There seems to be a consensus on using foreign and domestic policies to compete vigorously with PRC.
– In class we’ll talk a lot about organizational cultures. There’s a new SOCOM report recognizing a need for some changes in its culture.
– Jim Lewis of CSIS analyzes the impact of the UK decision to use some Huawei products.
-FT warns that India and China are both facing stagflation.
My SAIS colleague Charlie Stevenson distributes this almost daily news digest of foreign/defense/national security policy to “Stevenson’s army” via Googlegroups. I plan to republish here. If you want to get it directly, To get Stevenson’s army by email, send a blank email (no subject or text in the body) to stevensons-army+subscribe@googlegroups.com. You’ll get an email confirming your join request. Click “Join This Group” and follow the instructions to join. Once you have joined, you can adjust your email delivery preferences (if you want every email or a digest of the emails).
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Economic sanctions work, but…
The continued use of US economic sanctions against Iran, Venezuela, North Korea and Cuba was the focus for a Brookings panel, Economic Sanctions: Assessing their use and implications for U.S. foreign policy on January 27. Moderated by James Goldgeier, Robert Bosch Senior Visiting Fellow, the panel included Suzanne Maloney, Senior Fellow Center for Middle East Policy, Energy Security and Climate Initiative, Jung H. Pak, Senior Fellow Center for East Asia Policy Studies, and Ted Piccone, Nonresident Senior Fellow Security and Strategy.
Four Case Studies
Maloney believes the US uses sanctions in tandem with diplomacy with Iran, but usually is not joined by others. Two changes have occurred that altered the effectiveness of sanctions on Iran:
- After the 9/11 attacks, US sanctions became more targeted and were no longer only trade sanctions.
- The energy market has shifted with increased production outside the Persian Gulf.
US sanctions have not achieved their political goal of a dramatic reversal of core Iranian policy, but rather have only impacted the economy. Maloney argues that economic sanctions are effective in countries that already have dysfunctional economies, allowing the sanctions to compound structural problems.
Pak, an expert on North Korea, claims that the US only started piling on sanctions on North Korea since 2016, focused on sectors like seafood, iron, oil. The targeted sanctions of 2005 on Banco Delta Asia, which was helping facilitate North Korean illicit financing measures, led to serious economic problems. This sanction signaled to other banks and investment funds that doing business with North Korea was risky.
Piccone emphasizes that Cuba is an example of ineffective US sanctions, since they did not achieve their specified target of dislodging the Communist regime and removing Castro from power even if they were successful in stifling the economy. The US failed with Cuba sanctions to gain multilateral support. Due to the devastated economy, Cubans suffered and migrated: over 10% of the Cuban population lives outside Cuba, with the majority residing in the US.
Piccone contrasts Cuba sanctions with Venezuela, where the US shifted from targeted sanctions to sectoral ones, particularly on oil and gas. These sanctions amplified many of Venezuela’s existing economic problems. Sanctions effectiveness is closely tied to how dependent a country is on the US.
All panelists emphasized that even economically ‘successful’ sanctions can still be rendered ineffective if the political goals behind the sanctions are not realized.
Credibility is important
Maloney underlines the importance of sustaining credibility with regards to sanctions. Even before the May 2019 JCPOA withdrawal, Iran felt that the US was not upholding its side of the deal, as there continued to be new sanctions placed on the country.
All the panelists noted how muddled sanctions can be when the US makes exceptions for a program like the JCPOA, but maintains other sanctions related to support for terrorism and human rights violations. Maloney suggests that these remaining sanctions deter international banks and investors and reduce investment in Iran. The US withdrawal from the agreement undermined US credibility. Piccone adds that the inconsistencies between US administrations only further confuse the aims of sanctions, particularly in the case of Cuba.
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