By George A. Lopez
Thirty years ago this week the United Nations Security Council responded to Iraq’s invasion of Kuwait with mandatory, comprehensive economic sanctions. By 2000 the UNSC, led by the United States, had imposed powerful embargos in 11 other cases of threats to international peace and security. Despite developing more targeted “smart sanctions” aimed primarily at group and national leaders, elongated sanctions episodes continued to wreak disastrous consequences on civilians through the present day. The Trump Administration’s use of maximum pressure sanctions, which some see as targeted, plus trade sanctions on steroids, have devastated civilians in North Korea, Iran, and Venezuela, thus solidifying wide acceptance that sanctions constitute economic war.
Just as U.S. policy should end our endless wars, sanctions as part of protracted war — as in Iraq and Afghanistan — or sanctions that make war on general populations should also end. Whoever wins the presidency in November must rethink how sanctions can be an essential, yet prudent, tool of U.S. economic statecraft. Such a reformulation should rely on lessons learned from sanctions research and include reconstructing the U.S. government vision and architecture for sanctions policy.
When, why, and how do sanctions work
Sanctions work best when they are one of a number of diverse tools employed to achieve a clearly defined and consistent set of policy goals. Sanctions must not only bite and enrage the targeted group or nation, but actually engage them in continued diplomacy focused on the behavior needed to lift the sanctions. At best, sanctions achieve compliance from their targets in about one-third of cases, with that compliance occurring within two and a half years. Short of full success, the greater the active diplomacy accompanying sanctions, the stronger the constraints stifling the target’s goals.
Historically, multilateral sanctions are more successful than unilateral. Recent decisions by the U.S. to maximize implementation through expanding targeted designations and imposing crippling banking sanctions has led to greater negative impact on civilians, thus eroding international cooperation. Sanctions fail in various ways but most often when the policy goals are diffuse, unrealistic in making multiple demands, or when obsession with adding more sanctions lead sanctions to become the policy, rather than a means to policy.
Understanding the nuances of sanctions success in issue areas important to the U.S. is critical to improving their effectiveness in future U.S. policy. Regarding human rights, neither unilateral nor multilateral sanctions have ever toppled a brutal dictator. Nor have sanctions, by themselves, ever forced rights violators to desist in their worst acts. Most effective, however, are two sanctions strategies. The first lies in the standard mantra, “follow the money,” which most often applies to sanctions concerns with terrorist networks or when U.S. banking and currency markets are in jeopardy. But as organizations like the Sentry Project have demonstrated, sanctions policy actions can identify brutal rights abusers for the kleptocrats that they are, freeze their worldwide assets, and hold them to full account.
Second, as pre-atrocity indicators increase in a society, sanctions can play a significant prevention or mitigation role through asset seizures and travel bans on a range of mid-level economic and political enablers who strengthen and shield brutal dictators. These include bankers, industrialists, and police and military networks in and outside a rights abusing regime. U.S. leaders must mobilize anew the Global Magnitsky Human Rights Accountability Act as the strongest mechanism for action against kleptocrats and enablers.
To constrain nuclear non-proliferation, the U.S. needs a similar new awareness and agility. Sanctions cannot bludgeon a nation into giving up what it considers as its most powerful security protection. But nuclear reversal has occurred in Iran, Ukraine, South Africa, Brazil, and Libya when sanctions deny money and material critical to the development of arsenals, while new security guarantees are forged from intense problem-solving diplomacy. In addition, these agreements are accompanied by a versatile array of economic inducements from a number of nations which motivates and sustains the target renouncing nuclear development.
Creating a “whole of government” approach to U.S. sanctions
To launch a new, diplomacy-dominated sanctions era, future U.S. presidents must create a new architecture featuring a whole of government approach to ensuring sanctions success. This entails reinvigorating some agencies and redefining the roles of others to improve sanctions design and impact assessment.
Such restructuring begins with re-establishing the key role of the State Department in policy formulation and negotiation by restoring its Office of Sanctions Policy that was dissolved in 2017. A similar re-injection of sanctions expertise will be needed in the National Security Council and in the Policy Planning Staff at State. These reforms, in turn, must lead to a rebalance of power with the Treasury Department where the Secretary’s Office and the Office of Foreign Asset Control has had extensive sway over the politics of sanctions.
In this reorganization, OFAC and Treasury will still have important but different roles to play. The more than 8,000 entries on the Specially Designated Nationals and Blocked Persons List in Treasury results from the discovery of networks trading in prohibited materials, money laundering, and establishing shadow banks and financial institutions as sanctions evasion strategies employed by targeted governments or groups.
The next administration should de-politicize this listing procedure and keep them more narrowly defined as the international criminal activity they are. The tasks of “outlawing” actors via sanctions has convoluted the delicate diplomacy needed to produce the compliance the U.S. seeks from national leaders. Sanctions policy benefits if OFAC pursues criminal charges in the legal realm and not in the political lane.
New thinking should also be brought to the role of the Commerce Department and the U.S. Agency for International Development in attaining sanctions goals from an inducement perspective. Commerce could build on its recent success in bolstering ventures in Sudan in that nation’s early post-dictatorship era. USAID can inject assistance to areas of a post-sanctions economy in most need of recovery.
The role of Congress in validating a new and vigorous sanctions plan by providing additional funding for such foreign policy priorities cannot be overlooked. So too Congress might finally pass into law a proposal offered 20 years ago by the late Senator Richard Lugar that imbeds a two year sunset clause into U.S. sanctions. To extend sanctions beyond that would require the administration to certify the national security role of the sanctions, state their current effectiveness, and document they were not harming civilians.
Finally, based on past experiences, international relief agencies and the NGO community can claim quite rightly that humanitarian sanctions are an oxymoron. Therefore, a new, nimble and sensible sanctions policy would incorporate their experiences and remedies into the definition of rules governing their travel, delivery of supplies, and additional exemptions they need for preventing and mitigating humanitarian crises. With their guidance, U.S. sanctions design, implementation, and enforcement can reduce dramatically the duration and depth of the negative impact sanctions have on innocent civilians.
However difficult the task may be for U.S. leadership to develop sanctions that “do no harm” to the general population, the time for constructing these tools has come. Such action and the policy goals it would support could end senseless and endless sanctions.
George A. Lopez
Source: Responsible State Craft.