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Who Says Economic Sanctions Work?

The Iman Reva Shrine in Mashhad, Iran. (Peter Van Buren)

The imposition of new, more stringent sanctions targeting Iranian oil sales by the Trump administration has once again raised the question: is this even a viable policy?

The Council on Foreign Relations defines sanctions as “a lower-cost, lower-risk, middle course of action between diplomacy and war.” In short, sanctions do not represent policy per se, but rather the absence of policy, little more than a stop-gap measure to be used while other options are considered and/or developed.

Not surprising, sanctions have rarely—if ever—succeeded in obtaining their desired results. The poster child for successful sanctions as a vehicle for change—divestment in South Africa during the 1980s in opposition to the Apartheid regime—is in reality a red herring. The South Africa sanctions were in fact counterproductive, in so far as they prompted even harsher policies from the South African government. The demise of Apartheid came about largely because the Soviet Union collapsed, meaning the South African government was no longer needed in the fight against communism.

Another myth that has arisen around sanctions is their utility in addressing nonproliferation issues. Since 1994, the U.S. has promulgated non-proliferation sanctions under the guise of executive orders signed by the president or statutes passed by Congress. But there is no evidence that sanctions implemented under these authorities have meaningfully altered the behaviors that they target. Better known are the various sanctions regimes authorized under UN Security Council resolutions backed by the United States, specifically those targeting Iraq, North Korea, and Iran.

The Iraq sanctions were, by intent, a stop-gap measure implemented four days after the Iraqi invasion of Kuwait and intended to buy time until a military response could be authorized, organized, and executed. The nature of the Iraq sanctions regime was fundamentally altered after Operation Desert Storm, when the objective transitioned away from the liberation of Kuwait, which was achieved by force of arms, to the elimination of weapons of mass destruction, which was never the intent of the sanctions to begin with. The potential for sanctions to alter Iraqi behavior was real—Iraq had made the lifting of sanctions its top priority, and thanks to aggressive UN weapons inspections, was effectively disarmed by 1995.

This potential, however, was never realized in large part to the unspoken yet very real policy on part of the U.S. that sanctions would not be lifted on Iraq, regardless of its level of disarmament, until which time its president, Saddam Hussein, was removed from power. Since the sanctions were not designed, intended, or capable of achieving regime change, their very existence became a policy trap—as the sanctions crumbled due to a lack of support and enforcement, the U.S. was compelled to either back away from its regime change policy, which was politically impossible, or seek regime change through military engagement. In short, American sanctions policy vis-à-vis Iraq was one of the major causal factors behind the 2003 decision to invade Iraq.

One of the flawed lessons that emerged from the Iraq sanctions experience was that sanctions could contribute to regime change, in so far as they weakened the targeted nation to the point that a military option became attractive. This is a fundamentally flawed conclusion, however, predicated on the mistaken belief that Iraq’s military weakness was the direct byproduct of sanctions. Iraq’s military weakness was because its military had been effectively destroyed during the 1991 Gulf War. Sanctions contributed significantly to Iraq being unable to reconstitute a meaningful military capability, but they were not the cause of the underlying systemic problems that led to the rapid defeat of the Iraqi military in 2003.

The “success” of the Iraq sanctions regime helped guide U.S. policy regarding North Korea in the 1990s and 2000s. Stringent sanctions, backed by Security Council resolutions, were implemented to curtail North Korea’s development of nuclear weapons and ballistic missile delivery systems. Simple cause-effect analysis shows the impotence of this effort—North Korea’s nuclear and ballistic missile capability continued unabated, culminating in nuclear-tipped intercontinental ballistic missiles capable of reaching U.S. soil being tested and deployed. The notion that sanctions could undermine the legitimacy of the North Korean regime and facilitate its collapse was not matched by reality. If anything, support for the regime grew as it demonstrated its willingness to stand up to the U.S. and proceed with its nuclear weapons and ballistic missile programs.

The Trump administration labors under the fiction that it was the U.S. policy of “maximum pressure” through sanctions that compelled North Korea to agree to denuclearization. The reality, however, is that it is North Korea, backed by China and Russia, that has dictated the timing of the diplomatic breakthrough with the U.S. (the so-called “Peace Olympics”), and the pace of associated disarmament. Moreover, North Korea’s insistence that any denuclearization be conducted parallel to the lifting of economic sanctions demonstrates that it is in full control of its policy, and that the promise of the lifting of economic sanctions has not, to date, prompted any change in Pyongyang’s stance. While President Donald Trump maintains that the U.S. will not budge from its position that sanctions will remain in place until North Korea disarms, the fact of the matter is that the sanctions regime is already collapsing, with China opening its border, Russia selling gasoline and oil, and South Korea engaged in discussions about potential unification.

The U.S. has lost control of the process, if indeed it was ever in control. It is doubtful that the rest of the world will allow the progress made to date with North Korea to be undone, leaving the U.S. increasingly isolated. Insisting on the maintenance of a sanctions regime that has proven ineffective and counterproductive is not sustainable policy. As with Iraq, U.S. sanctions have proven to be the problem, not the solution. Unlike Iraq, North Korea maintains a robust military capability, fundamentally altering the stakes involved in any military solution the U.S. might consider as an alternative—in short, there is no military solution. One can expect the U.S. to alter its position on sanctions before North Korea budges on denuclearization.

Iran represents a far more complex, and dangerous, problem set. The United States has maintained sanctions against Iran that date back to the 1979 Iranian Revolution that overthrew the Shah, and the seizure of the U.S. embassy and resultant holding of its staff hostage for 444 days. The U.S. policy vis-à-vis Iran has been one where the demise of the ruling theocracy has been a real, if unstated, objective, and every sanctions regime implemented since that time has had that outcome in mind. This is the reverse of the Iraqi case, where regime change was an afterthought to sanctions. With Iran, the issue of nuclear non-proliferation was an additional justification for sanctions. Here, disarmament concerns eventually trumped regime change desires, to the extent that when the U.S. was confronted by the reality that sanctions would not achieve the change in behavior desired by Tehran, and the cost of war with Iran being prohibitively high, both politically and militarily, it capitulated. It agreed to lift the sanctions in exchange for Iran agreeing to enhanced monitoring of a nuclear program that was fundamentally unaltered by the resulting agreement, known as the Joint Comprehensive Program of Action, or JCPOA.

When Trump withdrew from the JCPOA, he did so in an environment that was radically different than the one that was in play when President Barack Obama embraced that agreement in July 2015. Today, the U.S. stands alone in implementing sanctions, while Iran enjoys the support of the rest of the world (support that will continue so long as Iran complies with the provisions set forth in the JCPOA.) Moreover, Iran is working with its new-found partners in Europe, Russia, and China to develop work-arounds to the U.S. sanctions.

The coalition of support that the U.S. has assembled to confront Iran, built around Israel and Saudi Arabia, is not as solid as had been hoped—Israel is tied down in Gaza, while Saudi Arabia struggles in Yemen, and is reeling from the fallout surrounding the murder of Jamal Khashoggi. Concerns that strict sanctioning of Iranian oil would result in a spike in global oil prices prompted Trump to grant waivers to eight of Iran’s largest purchasers of oil, creating a situation where Iran’s oil-based income will increase following the implementation of sanctions. The bottom line is that the current round of U.S. sanctions targeting Iran will not achieve anything.

For the meantime, Iran will avoid confrontation, operating on the hope that it will be able to cobble an effective counter to U.S. sanctions. However, unlike Iraq, Iran has a very capable military. Unlike Korea, however, this military is not equipped with a nuclear deterrent.

If history has taught us anything, it is that the U.S. tends to default to military intervention when sanctions have failed to achieve the policy goal of regime change. Trump, operating as he is under the influence of Secretary of State Mike Pompeo and National Security Advisor John Bolton, is not immune to this trap. The question is whether Iran can defeat the sanctions through workarounds before they become too crippling and the regime is forced to lash out in its own defense. This is one race where the world would do well to bet on Iran, because the consequences of failure are dire.

Scott Ritter is a former Marine Corps intelligence officer who served in the former Soviet Union implementing arms control treaties, in the Persian Gulf during Operation Desert Storm, and in Iraq overseeing the disarmament of WMD. He is the author of Dealbreaker: Donald Trump and the Unmaking of the Iran Nuclear Deal (2018) by Clarity Press.

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