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War by Another Name

Sanctions are not a gentler alternative to conflict

By 52 BC, less than a year after it began, Vercingetorix’s Gallic rebellion had fallen on hard times. A series of defeats at the hands of Caesar’s Roman legions forced the chief of the Arveni to withdraw to the settlement of Alesia. It proved to be his last stand. The Romans besieged the town, enclosing eighty thousand or so Gallic fighters—and the local population—within some twenty-five miles of fortifications. Then they waited. Running out of food behind the blockade, the Gauls sent out their women and children. Caesar’s Commentary on Caesar’s Gallic War, transcribed in the third-person voice beloved by celebrities and tyrants alike, tells us what happened next: “When these came to the Roman fortifications, weeping, they begged of the soldiers by every entreaty to receive them as slaves and relieve them with food. But Caesar, placing guards on the ramparts, forbade them to be admitted.” The civilians were starved, caught between armies. Caesar soon triumphed. Much of the Gallic force was massacred, while Vercingetorix was imprisoned for six years and then garroted.

Having persisted through the centuries, siege warfare remains a feature of contemporary conflict, from Stalingrad to Sarajevo, though the 1949 Geneva Convention states that forces besieging an area may not starve civilians “as a method of warfare.” For instance, over six months in 2015–2016, Syrian government forces laid siege to the rebel-held town of Madaya, allowing only intermittent humanitarian convoys through. Unable to leave, residents were forced to eat leaves. In a January 2016 report, Médecins Sans Frontières said that twenty-three people had died of starvation in the previous month, while another twenty thousand people faced absences of basic goods and medicine. At the same time, in Yemen, Houthi forces blockaded the city of Ta’izz from August 2015 to March 2016, shelling civilian areas, while the Saudi-led coalition, which controls Yemen’s seas and airspace, blockaded rebel-held territory—the capital Sanaa was closed from 2015 until a recent ceasefire, signed in April 2022. The coalition’s actions have contributed to a situation in which 23.4 million people will be in need of humanitarian aid in 2022, some 75 per cent of Yemen’s population.

Like sieges, country-wide sanctions do not distinguish between armed actors and civilians, and all too often lead to starvation. Yet they are held out as a gentler alternative to open conflict—as if destroying a country’s economy could be a peaceful gesture. Easy to implement and apparently “bloodless,” they hold a particular appeal for the American political establishment, whose public has tired of maintaining an empire abroad. Obama created 2,350 new sanctions during his second term; Trump added another 3,800. Sanctions against Russia following its invasion of Ukraine are now talked about in language that once characterized depictions of the second Iraq war. “This is full-on shock and awe,” a former senior White House official told the Financial Times in April. “It’s about as aggressive an unplugging of the Russian financial and commercial system as you can imagine.”

The consequences of this war—for that is what it is—will be felt across the world, as wheat prices spike and supply chains are disrupted. The bodies that will pile up as a result will also be all too real, though they may not register with the technocrats in D.C. Unlike those talking sanctions up today, their cost was well understood by the pioneers who first considered deploying them. In his new book, The Economic Weapon: The Rise of Sanctions as a Tool of Modern War, Cornell historian Nicholas Mulder cites a British blockade administrator, William Arnold-Foster, who warned in 1920 that “the economic weapon is one which is so infernally convenient to use that it naturally commends itself to those who sit in offices. Pens seem so much cleaner instruments than bayonets.”

In a celebrated passage from The Economic Consequences of The Peace, John Maynard Keynes’s critique of the Treaty of Versailles, the author stands in awe of the transformations of the past fifty years. Before 1870, he writes, each European nation was largely self-sufficient. By 1914, he can behold the world as an Amazon consumer might:

The inhabitant of London could order by telephone, sipping his tea in bed, the various products of the whole earth, in such quantity as he might see fit, and reasonably expect their early delivery upon his doorstep.

It’s a vision that could only be entertained in the heart of the British Empire, which reigned supreme in a world newly connected by global markets. In 1914, London financed 60 percent of global trade, while 75 percent of coking fuel—then the predominant energy source for cargo vessels—was produced in Britain. Might we not use our power, imperial administrators wondered, to turn off global supplies, blocking market access to those we don’t like? It was only because the world had become deeply inter-connected that parts of it could be disconnected. This is where Mulder opens his book, which charts the rise of sanctions as an essential component of the liberal international order.

Far from preventing the outbreak of World War Two, sanctions might have accelerated it

The first such intervention in mainland Europe occurred during the First World War, when the Allies imposed a blockade, financial as well as material, on the Central Powers. They stopped and searched ships in the North Sea; inspected neutral vessels wishing to receive coal at British ports; confiscated assets in London; and threatened banks with exclusion from the global financial system. The blockade of the Ottoman Empire’s Middle Eastern territories was even more total: from December 1915 to October 1918, no ships were allowed to cross the British line. However, the sanctions had little effect on the Ottoman leadership, which rather welcomed the dereliction and starvation they wrought on “seditious” Armenian and Arab populations.

The balance sheet of this economic blockade was not propitious. On the negative side of the ledger: nearly a million deaths from starvation. On the positive side: zilch. It didn’t tank Germany’s war machine, which redeployed capacity from its largely export-driven economy elsewhere. More fundamentally, it did not end the war. The success of the Hundred Days Offensive, which caused the abdication of the Kaiser, was rather due to influenza and battlefield exhaustion.

Nevertheless, in the postwar period, both sides colluded in a myth about the blockade’s effectiveness. For the new German government, this was a useful way of occluding its army’s total collapse of morale. For the victors, it justified crafting a place for sanctions—economic blockades writ large—in the new world order created at the Paris Peace Conference and through the League of Nations. The threat of sanctions, Woodrow Wilson thought, would instill so great a fear in bellicose regimes that world peace would prevail. The economic weapon, as sanctions came to be called, was intended as a form of war that would end all war. These lofty humanitarian intentions should remind us of a quip by the German philosopher Carl Schmitt: “Whoever invokes humanity is trying to cheat.”

After the Treaty of Versailles, the blockade of Germany continued, bringing the economic weapon into the realm of everyday commerce: henceforth, sanctions would be used to wage war in peacetime. The imperial powers also placed sanctions against the communist governments in Budapest and Moscow, which also proved unsuccessful: it was the Romanian army that invaded Budapest, causing the fall of Béla Kun’s government. By March 1921, worried about the growing power of organized labor, which didn’t look kindly on sanctions, Britain ended its boycott of the Soviet Union. Trying to starve out Moscow had not managed to break the Bolsheviks.

The Economic Weapon argues against classical realist texts like E.H. Carr’s The Twenty Years’ Crisis, which claimed that the threat of sanctions from the League of Nations was unconvincing because it was not backed by military force. Mulder makes much—perhaps too much—of sanctions’ spotty success as a deterrent in the 1920s. It’s true that expansive Yugoslav designs on Albania were headed off in 1921, and that Greek mobilizations for a war against Bulgaria were brought to a halt in 1925. But on the central issues of the day, sanctions failed or weren’t imposed. The League of Nations was silent when France invaded the Ruhr region of Germany in 1923. Sanctions placed on Italy following its invasion of Abyssinia (present-day Ethiopia) in 1935 didn’t stop Mussolini’s advance. In the run-up to the Second World War, the League made no serious efforts to impose sanctions on Japan, following its invasion of Manchuria in 1937, or on Germany, following its occupation of the Rhineland (1936) and the annexation of Austria (1938).

Far from preventing the outbreak of war, sanctions might have accelerated it. Aware of its acute dependence on external supplies of resources, Germany forged a four-year plan in 1936 that called for Rohstoff-Freiheit—raw-material freedom. Lacking crucial minerals, it envisioned a policy of expansionary autarky, in which control of Central Europe and access to Russia could become an antidote to an economic blockade in the west. Japan thought similarly: the invasion of Manchuria was intended to win an industrial hinterland in case sanctions cut off flows of raw materials.

Photography and collage by Wolf Böwig, 2020/21. For VG-Bild Stipendium 2020.

After the Second World War, sanctions returned, this time with more bite, at least in theory. The UN charter codifies them as a part of the international order, presided over by the Security Council (UNSC). No longer focused on preserving European interstate relations, they would have a global reach, backed by UN peacekeepers. That was the theory. The Cold War killed the promise of multilateral sanctions, as the UNSC—with the Soviet Union and China on it—could rarely agree on anything.

Instead, America was left to beat the sanctions drum alone, using the economic weapon as a way to bring uncooperative governments into line. It didn’t work. The longest running sanctions regime in the world is el bloqueo: America’s embargo of Cuba, which began in 1958 as a ban on arms and was expanded in 1962 to include almost everything else, remaining in place ever since, even as the UN General Assembly has passed a motion every year since 1992 calling for its end. The cost to Cuba, which is hotly debated, surely runs into the billions of dollars. The benefits to the American political class are limited to appeasing a rabidly anti-Castro Cuban electoral constituency in Florida. What the sanctions haven’t done is topple the Cuban regime, instead offering the Castros a bogeyman to blame for the island’s ills. El bloqueo also illustrates how remarkably sticky U.S. sanctions tend to be. Once in place, they are difficult to stop, for proposing such a measure opens politicians up to the charge of being soft on America’s enemies.

With the end of the Bretton Woods system in 1971, the dollar became the world’s reserve currency, used for the vast majority of international trade, and sanctions in turn became an instrument of first resort for the propagation of American power. For a disobedient country, exclusion from the international financial system meant economic death, and the corpses piled up. The Soviet Union and its Eastern European satellites, as well as Vietnam and China, were all severely affected by sanctions during the Cold War.

The morgue grew even more crowded after 1989, which inaugurated what experts call “the sanctions decade,” in which a newly toothless UNSC signed off on America’s pursuit of “rogue nations.” Iraq was an early victim. UNSC Resolution 661, passed in August 1990, shortly after Iraq invaded Kuwait, banned all UN member states from trading with Saddam Hussein’s regime, with some exceptions for medicine and food. The move was intended to force him to withdraw from Kuwait, but that required an American-led invasion. Yet sanctions remained in place for another thirteen years, backed by an ever-changing set of justifications.

As Joy Gordon shows us in Invisible War: The United States and the Iraq Sanctions, the sanctions regime was intended to exempt purchases with a humanitarian purpose, approved on a case-by-case basis by a special “661 committee,” which, at the United States’ behest, blocked the purchase of such notorious weapons as sewage pumps, water pipes, and common antibiotics—the latter because they could be used as an antidote to anthrax. (No, I don’t understand either). The humanitarian costs were staggering. Coming after the coalition attack on Iraq in 1991, which targeted basic infrastructure—including power stations, bridges, schools, and hospitals—sanctions made it impossible for the government to import equipment to repair these facilities. Per capita income in Iraq went from $3,510 in 1989 to $450 in 1996. Child mortality rose. Gordon finds that the sanctions contributed to the deaths of five hundred thousand children under the age of five, though they didn’t remove Saddam Hussein from power—that required another American invasion. While the Iraqi elite were inoculated from harm by their wealth, the poorest were most affected. The point is worth underscoring: countrywide sanctions are a fundamentally regressive form of warfare.

The use of sanctions doubled in the decade following 2000, while their rate of success plummeted.

None of this has staunched American demand for sanctions. Recent targets include the zombie regime of North Korea, which has not denuclearized; Iran, which faces acute shortages of pharmaceuticals because it cannot access global payment systems; and Venezuela, where a financial blockade put in place against Maduro’s government has played a role in the total collapse of the economy, which in turn has caused tens of thousands of deaths. Meanwhile, the leadership of all three regimes remains untouched, propped up by anti-sanctions propaganda. Syrian sanctions have been equally ineffective, and also deadly. Under the ironically named Caesar Syria Civilian Protection Act, those dealing with figures on the Syria sanction list are themselves subject to sanctions. Though humanitarian and medical supplies are legally exempt, many wary pharmaceutical companies have decided to limit or stop sales, contributing to shortages of critical medicines.

In recent years, the U.S. Treasury has come to rely on so-called “smart” sanctions, which are envisioned as precision-guided missiles of financial disaster, aimed at individuals and businesses rather than entire countries. They were developed during the War on Terror. Deploying the Patriot Act and a number of presidential decrees, the Treasury forced both banks and the now-infamous SWIFT system—a Belgian messaging network for interbank payments—to confidentially provide it with transaction data so it could go after terrorists’ financial networks. It was during the war on terror that the Treasury first claimed to have jurisdiction over dollar-denominated transactions made anywhere in the world, requiring foreign individuals to comply with American sanctions—a move bitterly resisted by the EU until recent measures taken against Russia.

Since 9/11, America has designated over sixteen hundred terrorist entities and individuals under sanction. According to an October 2021 Treasury review, these measures impaired Hezbollah’s funding streams to such an extent that it was forced to cut salaries. The Magnitsky Act of 2012—and then the Global Magnitsky Human Rights Accountability Act of 2016—allowed the American government to go after kleptocrats or violators of human rights laws even if they were not in enemy or rogue states. These legislations effectively turned the United States into a global IRS agent, hunting through bottom lines for evidence of deviance. But even smart sanctions, which supposedly cause less damage, rarely achieve their goals, as I have observed in my own research.

In 2019, I was invited to brief the U.S. State Department on the situation in South Sudan, a country where I often work. While America prided itself on its role in the country’s founding in 2011, a civil war that began two years later had wreaked havoc. I wanted to tell the assembled diplomats that a peace agreement, signed in 2018, had not decreased violence, and the government continued to attack internal enemies. After my presentation, delivered to an almost empty office, one weary official raised his head and dignified me with a glance. “So,” he said, “any recommendations on sanctions?”

Since 2014, shortly after the civil war began, the American government—along with the EU, UK, and the UN (since 2015)—have used sanctions to block the property and assets of individuals found to be involved in a wide range of activities in South Sudan, including human rights abuses and threatening “the peace, security or stability” of the country. Currently nineteen individuals and businesses are on the U.S. list. Proponents of smart sanctions count South Sudan among the success stories. In a recent Foreign Affairs article, John Prendergast and Justyna Gudzowska claimed sanctions help persuade South Sudanese president Salva Kiir to form a unity government in 2020.

My interviews with those under sanctions suggest this is not the case. In June 2015, while in Addis Ababa, I asked Peter Gadet about the measures taken against him. “They have made Gathoth Gatkuoth extremely jealous,” he told me, naming another commander. All too often, U.S. sanctions are a badge of pride. A lack of regional buy-in partly explains their lack of the efficacy—after all, I met Gadet in Ethiopia—but sanctions also rely on a misreading of commanders’ motives. Economic motivations might outweigh all others in the United States, but the ethnic politics of South Sudan are a lot more complicated. The unity government that was formed in 2020 grew out of internal political considerations rather than sanctions on evil warlords dreamt up in D.C.

Even in cases where targets are more exposed to the global market, smart sanctions are of limited utility, largely because of the lack of transparency built into the global financial system. Few countries have accessible ownership registries, which would reveal who owns the assets of anonymous companies. Even those that do enforce few meaningful checks on their veracity. As the Panama Papers show, such opacity is also what enables the offshoring of American corporate wealth. Perhaps a left case for sanctions can be made, based on the fundamental reform of the global financial system, but it’s a call for a reform of that system before it is an argument in favor of sanctions.

Photography and collage by Wolf Böwig, 2020/21. For VG-Bild Stipendium 2020.

The use of sanctions doubled in the decade following 2000, while their rate of success plummeted. The Global Sanctions Database evaluates that from 1985 to 2000, they worked between 25 and 40 percent of the time; by 2016, that figure had fallen to below 20 percent. Why, then, do sanctions remain an instrument of first resort for the American foreign policy establishment? Their centrality is paradoxically a sign of American weakness. In an increasingly multipolar world, the United States has fewer ways of influencing global politics and less domestic appetite to do so. Sanctions are one of the last tools in an emptying diplomatic toolbox, as illustrated by recent events in Afghanistan and Russia.

In August 2021, the United States impounded $9.4 billion of Afghan Central Bank assets, following its humiliating withdrawal from Kabul. The consequences for Afghanistan are sure to be grim. On March 25, 2022, the World Food Program predicted that 22.8 million people—more than half of the country’s population—will be acutely food insecure this year, with 8.7 million facing famine-like conditions. Biden has promised to increase food aid, but, as a group of forty-eight Democratic members of Congress noted in December 2021, “No increase in food and medical aid can compensate for the macroeconomic harm of soaring prices of basic commodities, a banking collapse, a balance-of-payments crisis, a freeze on civil servants’ salaries, and other severe consequences that are rippling throughout Afghan society, harming the most vulnerable.”

Planning for sanctions against Russia began in November 2021, when U.S. intelligence received credible reports about the invasion of Ukraine. The campaign was masterminded in D.C. by Daleep Singh, the deputy national security advisor for international economics at the White House, and Wally Adeyemo, a former executive with BlackRock, the world’s largest asset manager. The range of economic weapons they devised is astonishing in its breadth, including both countrywide and smart sanctions. Quickly, Russian financial institutions were cut off from SWIFT, deals with Russian companies were massively restricted, oligarch’s yachts were impounded, and the Russian Central Bank’s foreign currency reserves were frozen. The effect was instantaneous: the value of the ruble plunged, and the central bank raised interest rates to 20 percent. While the ruble has somewhat recovered on the back of rising energy prices, continued oil and gas sales, and currency manipulation, new sanctions on Russia’s energy exports, and its debt default, make a sustainable recovery unlikely. It’s estimated that Russia’s GDP will contract by at least 15 percent this year.

The global economy, which our businessman once thought was his to turn on and off, turns out to have escaped his grasp.

Despite their severity, it’s not really clear what the sanctions in Russia are for. The previous sanctions regime, put in place after the invasion of Crimea in 2014, did not stop the invasion of Ukraine in 2022. Indeed, Singh noted that these sanctions were actually very effective Russian propaganda. Experts widely agree that this time will not be different. Sanctions on the import of semi-conductors and a variety of electronics needed to repair military hardware are only meaningful in the longer-term. As a means of influencing the assault on Mariupol, they will have almost as little impact as a D.C. technocrat refusing to purchase Russian vodka. According to the U.S. Treasury review, sanctions should have “a clear policy objective within a broader U.S. government strategy.” Yet there are no conditions enabling the sanctions on Russia to be lifted.

Instead, the sanctions regime is intended to permanently “weaken” Russia, as Defense Secretary Lloyd Austin suggested on a visit to Kyiv in late April. It’s hard not to see this as a spectacle of American power, designed as a warning shot across China’s bow. As Larry Fink, the CEO of BlackRock, noted in a letter to his shareholders on March 24: “Access to capital markets is a privilege, not a right.”

If sanctions will not stop Putin’s war, they will have grim knock-on effects around the globe, as many countries are reliant on Russian exports. For instance, Egypt, which imports much of its wheat from Russian and Ukraine, will likely face spiraling protests; it was bread riots that proved the trigger for the Arab Spring, and food prices are already as high as they were in 2011. The rising price of gas has already meant that Norwegian fertilizer producers have turned off the taps—of no matter in America, but of huge consequence in Brazil, which is a net importer. The blockage of Russian ports will also exacerbate supply-chain problems already acute due to the Covid-19 pandemic. Indeed, rising commodity prices are playing out in a global landscape where heavily indebted countries, such as Tunisia and Sri Lanka, are facing shortages of basic goods. In February, prior to the war in Ukraine, the food-price index compiled by the UN’s Food and Agriculture Organization leapt to an all-time high. It increased once again in March, by 12.6 percent.

In The Economic Weapon, Mulder juxtaposes sanctions with the “positive economic weapon”—mutual aid at an international scale. In the present context, that would mean releasing grain and other food supplies from extensive reserves in the Global North, intervening to stabilize volatile commodity markets, and restructuring international debt. None of that seems to be on the table for a NATO alliance fixated on hurting Russia—as if punishment constituted a viable policy response.

It is possible to imagine a modern avatar of Keynes’s tea-sipper, now ensconced in New York. Satisfied with the removal of Russia from the global economy and certain that things are under control, he looks at his Bloomberg terminal with growing alarm, as the price of nickel surges to record highs, dashing his hopes of buying a new Tesla (nickel is an integral ingredient in lithium-ion batteries). Meanwhile, gas prices climb in America, and wheat and corn futures surge. The global economy, which our businessman once thought was his to turn on and off, turns out to have escaped his grasp. The cost of that self-satisfaction will be very high, and the balance sheet is not in yet.