June 2000 Fraser Forum: Sanctions and How They Don't Work
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Unilateral economic sanctions by the United States in the 1990s have shown a nearly total lack of success in achieving stated human rights and democratization objectives while consistently producing various adverse consequences. The people, for the most part, have suffered the economic pain caused by the sanctions, the positive influence of US private sector engagement has been diminished or lost, and target country governments have made exaggerated claims, to good propaganda effect, that US sanctions were the cause of what were really internal economic policy failures. This is also the policy area where the United States is almost entirely alone, if not at odds with friends and allies - not to mention the Catholic Church - which further reduces the prospects for positive concrete achievement.
The basic reason why these unilateral economic sanctions are ineffective is that the foreign policy objective is to change the oppressive behaviour of an authoritarian or totalitarian government, which constitutes a direct threat to such a government's control, if not survival. Such governments are consequently not prepared to make this kind of fundamental concession in response to the relatively small economic impact of unilateral economic sanctions. Even in the one case during the 1990s when far more devastating multilateral trade sanctions were applied in the cause of democratization - the three-year embargo against Haiti - the rag-tag Haitian military still held out, becoming more oppressive while the people suffered greatly and the economic infrastructure of the country was destroyed. In the end, a US military intervention was still needed to restore Jean Bertrand Aristide to the Presidential Palace.
All of the case studies bear out this assessment. Even with the abrupt cutoff of Soviet aid in 1991, the Castro regime has maintained power and almost all experts agree that Fidel Castro will retain control as long as he is physically able and willing to do so. In the process, he has adroitly used the US embargo to split the United States from its allies. The MFN/human rights linkage failed to achieve significant improvement in basic human rights in China during both the Bush and Clinton administrations, and President Clinton's decision to reverse course and jettison the linkage in May 1994 adversely affected broader US credibility with the Chinese communist leadership. The unilateral sanction on new US investment in Myanmar had no significant adverse effect on the Myanmar economy and has only tended to push the generals further into isolation from the rest of the world, except China, and into near total disengagement from the United States. A similar absence of any positive result is evident for the US unilateral trade embargo against the Sudan in 1996. As for other embargo proposals linked to democratization and human rights objectives in recent years, those against Indonesia and Nigeria had the most important potential consequences, but in both cases they were not pursued for largely the same reasons observed in the case studies - they would have limited economic impact if pursued unilaterally, with little prospect of the authoritarian/military governments reacting in a significantly positive way.
Narrowly-targeted economic sanctions, as distinct from the broadly-based trade and investment sanctions addressed in the previous paragraph, must be examined on a case-by-case basis, but again there are no clear success stories during the 1990s. The problem here is that targeted sanctions are extremely difficult and complicated to administer, as, for example, would be a targeted sanction against Chinese companies owned by the military, while having very small to insignificant economic impact. Freezing overseas bank accounts of members of a communist politburo or a military command can be circumvented with relative ease in a world of instant electronic banking and numerous banking safe havens. The 1998 Religious Persecution Act remains to be tested through implementation, but it is doubtful that it, by itself, will result in much greater tolerance and less repression of religious beliefs in countries such as China, Iran, and Saudi Arabia.
A final relevant indicator of whether US unilateral economic sanctions help or hinder the process of democratization and respect for basic human rights is the judgement of prodemocracy and human rights dissidents within the target countries, because they are in the front lines of the struggle, often at great personal risk. Attitudes are not monolithic, but the large majority of them are clearly on the side of US private sector engagement rather than unilateral sanctions. The antiembargo statement of Elizardo Sanchez represents the dominant dissident view within Cuba and should take precedence over anti-Castro Cuban-Americans living in Florida and New Jersey. The predominant view of prodemocracy activists in China, including Hong Kong, and Vietnam is also strongly supportive of US private-sector engagement.
Only in Myanmar is there a clear split among prodemocracy dissidents, including within the National League for Democracy (NLD), and the outspoken view of Aung San Suu Kyi against private sector engagement or even engagement by most humanitarian-oriented nongovernmental organizations and aid agencies has received broad international recognition and official support. Indeed, the actual imposition of the US unilateral investment sanction in May 1997 by the second Clinton administration foreign policy team was triggered less by the "substantial increase in oppression" criterion contained in the Cohen/Feinstein legislation, than by Aung San Suu Kyi's call for the sanction shortly before. The judgment here, with all due respect for her courageous, democratic struggle, is that she is wrong in advocating foreign private sector and international agency disengagement from her country, with all the inherent short- and longer-term adverse impact this has on the people of Myanmar, as the means for changing the oppressive behaviour of the military regime.
In conclusion, overall, unilateral economic sanctions during the 1990s have generally been ineffective in achieving their foreign policy objectives while having various adverse effects on other US interests. The record for sanctions directed at human rights/democratization objectives is especially bleak, while targeted sanctions for national security objectives, in the case of China, at least, produced a positive result. The rare exceptions of positive results from unilateral sanctions, however, only tend to prove the rule in view of the unique circumstances involved in each such instance.
Ernest H. Preeg is a Senior Fellow at the Hudson Institute and the Senior Fellow in Trade and Productivity at the Manufacturers Alliance/MAPI. He specializes in international economic and foreign policy. Dr. Preeg is the author of 13 books and numerous shorter works. The full text of this paper, which is an updated version of Chapter 7 of Feeling Good or Doing Good with Sanctions (1999), published by the Center for Strategic Studies, is available on our website at www.fraserinstitute.ca.
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