Sanctions are back in the news — though if you’re President Donald Trump, that’s not a good thing. Here’s a look at the current state of U.S. sanctions on a few key countries and how they’re faring.
This week, the U.S. House of Representatives voted on a new round of sanctions against Russia, targeting its intelligence, energy, defense, mining and railway industries. The U.S. has had sanctions in place against Russia since the 2014 invasion of Ukraine and annexation of Crimea, but this latest round also hits Russia for meddling in the 2016 U.S. election. Sanctions take years to have full effect—in the short term, they’re mainly a shot across the bow (and one to which Putin has already retaliated). But you don’t often see a Republican-led Congress using sanctions as a shot across the bow of a Republican president.
Near-universal support from Congress (the sanctions bill passed the Senate by a 98-2 margin; the House of Representatives went 419-3) undermines Trump’s ability to unilaterally lift sanctions against Russia—compromising the traditional power of the president to lead the country’s foreign policy (if Trump wants to try to lift these sanctions, Congress has 30 days to approve or reject this request). The bipartisan bill had been held up by ferocious White House lobbying, but the realization has since set in that the bill will pass, even if Congress has to override a presidential veto. Trump still says that accusations his campaign colluded with the Russian government are “fake news.” Fake or not, concerns about his relations with Russia are beginning to have real impact on policy.
While the Russia component of the bill is receiving the lion’s share of media attention, it also ramps up penalties against North Korea (in addition to Iran—see below). The U.S. has kept sanctions on the North Koreans since the Korean War. Not that they’ve done much beyond adding to the misery inside a country where 41 percent of people are undernourished and more than 70 percent depend on food aid. The Kim dynasty remains in power and continues to develop the country’s nuclear program. In fact, U.S. intelligence revised estimates just this week to say that Pyongyang could develop the capability to deliver a nuclear weapon to the continental US within a year. Some experts believe an ICBM tested on Friday could already put U.S. cities at risk.
But recent North Korea sanctions have also ricocheted on China, North Korea’s primary benefactor and link to the outside world. More than 90 percent of North Korea’s trade volume comes from China, not to mention most of its food and energy. North Korea uses Chinese banks to fund transactions throughout the rest of the world, and recent rounds of sanctions have targeted those Chinese banks and companies. Trump continues to complain that Beijing should place more pressure on the Kim regime; this is one way to add more encouragement. It’s highly unlikely to be enough to change Beijing’s mind though, given Chinese fears of extreme instability on the Korean peninsula.
Sanctions on Iran, on the other hand, have shown some results, because unlike North Korea, Iran wants a deeper commercial and political engagement with the rest of the world. Cutting off access to global markets and investments, as well as freezing $56 billion in assets, hit the country hard. Iran had hoped that signing the 2015 nuclear deal would breathe new life into its economy by allowing it to return to oil markets, and it has—though not by as much as moderates like President Hassan Rouhani had hoped.
Iran is still being kept in the cold despite the nuclear deal because the U.S. has retained sanctions over Iran’s ballistic missiles program, human rights abuses, and state sponsorship of groups like Hezbollah that Washington considers terrorist organizations. The country’s also being held back by plummeting oil prices: when Iran first signed the 2013 interim deal that would ultimately become the nuclear deal we know today, oil was selling at $111 and Iran was producing about 2.8 million barrels a day. Today, it’s producing nearly 4 million barrels daily, but oil is only selling at just over $50. Sometimes, the free market can be crueler than sanctions.
U.S. sanctions against Syria have been in place since 2004, long before the country descended into civil war. The Bush and Obama administrations accused the Assad regime of supporting terrorism, pursuing weapons of mass destruction, and undermining the U.S. in neighboring Iraq.
But instituting country-wide sanctions gets harder when the country in question is falling apart. The latest round have been more precisely targeted: following Assad’s use of sarin gas against civilian populations, the U.S. government levied sanctions against 271 Syrian individuals who work for the government agency making chemical weapons in April 2017. Members of Assad’s family saw their U.S. assets frozen in May. A strength of sanctions is that they can be aimed directly at individual sectors and officials, limiting damage to ordinary citizens and creating incentives for more cooperative behavior. But that advantage isn’t worth much when the government in question is already fighting for its life.
More than 80 percent of Americans (not to mention a majority of Republicans) supported lifting the Cuban travel embargo back in 2015; 58 percent of Americans favored reestablishing diplomatic relations. Despite that, Trump has rolled back some of those Obama provisions by limiting commerce with Cuban businesses affiliated with the military, which owns almost all of the island’s retail chains and hotels. Trump has also ordered that any American who wants to visit the island for “educational” purposes must do so through a licensed tour group. The embassies in Washington and Havana will remain open.
The U.S. has been sanctioning Cuba in one form or another since the Dwight Eisenhower administration in the late 1950s. John F. Kennedy expanded sanctions further, and they remained in place for more than 50 years until Obama eased many restrictions. Over the decades, Cuba estimates that the U.S. embargo has cost the country nearly $117 billion, yet the island is still governed by Raul Castro following his brother’s death in November.
The lesson of sanctions: context is everything. About 10 years ago, I wrote a book called The J-Curve, where I envisioned all the countries in the world plotted on an X-Y axis.
On the far left of the curve are countries like North Korea and Cuba, whose regimes are stable precisely because they’re closed off from the rest of the world. On the far right of the curve are open countries like Germany and the U.S., whose governments are stable precisely because they engage with the rest of the world. Sanctions generally shift countries further left along the curve; sometimes, if the sanctions are significant enough, they can shift the entire curve downwards for a single country.
Put another way: a government like Syria’s that is fighting for its life will always have bigger problems than sanctions guiding its choices. But when sanctions are imposed on governments that feel safer outside the international system like those in North Korea and Cuba (i.e. on the far left of the J-Curve), the penalties are unlikely to bring about change — especially when they can rely on a deep-pocketed patron. (Cuba has recently opened mainly because the friendly Chavista government in Venezuela seems fated to join the Soviet Union on the ash heap of history.)
A larger country on the left-hand side of the J-curve like Russia is more vulnerable to its own economic shortcomings than to Western sanctions. But pressure on a country like Iran (also on the left side of the J-Curve, but near the dip), one that wants to plug into international commerce but that remains small enough to isolate, has more potential for success.
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