Economics Essay / Costs and Benefits of U.S. Economic Sanctions

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Economic sanctions represent those broad or specific penalties levied against a nation, entity or individual citizens in the form or trade or financial withdrawals as part of a foreign policy strategy to coerce or to make the targeted nation change or eliminate an unwanted behavior or policy. The United States has used economic sanctions with mixed results of success since the post-World War II era both multi and unilaterally form.   The objectives for these sanctions include promoting democracy and human rights, fighting drug trafficking, fighting terrorism, combating weapons proliferation and promoting disarmament (Hufbauer & Oegg).

Achieving the desired foreign policy objectives through economic sanctions may imply serious cost to the sender nation (the United States) as it is the one that has to design, implement and enforce the sanctions (Davis & Engerman, 191). Another factor that can seriously limit the achievement of these goals through economic sanctions is the globalization of the world economy.  When a targeted nation is sanctioned by the U.S., it can look to other countries for trading and investment opportunities thus dampening or limiting the effect of the sanction (191-192).

Another factor which limits the achievement of the desired goal is the type of regime targeted for economic sanctions.  When these types of penalties have been imposed on Cuba (trade embargo) and the former Soviet Union (grain embargo), the U.S. did not achieve the intended goals of respectively ending the Castro regime and forcing the Soviets to withdraw from Afghanistan. With the globalization of the world economy, it is much easier for targeted countries to find alternative sources for trade or for capital markets and when sanctions have been imposed by the U.S., it is those firms and workers corresponding to the sanctioned sector that feel the immediate impact of lost jobs and wages (Hufbauer & Oegg).

            Sanctions have been successful both in achieving the desired goals and in being an instrumental part of them only in a limited number of situations that have been documented from the early 20th century until the early 21st century.  A recent Washington Post reports that those few instances of goal attainment occurred where the country has been an ally, where the objectives have been modest and narrow and where the targeted country has been either smaller or weaker than the United States (Taylor).

            Although their effectiveness has long been questioned, it is likely that economic sanctions will continue to be a part of U.S. foreign policy measures.  However, instead of utilizing blunt economic sanctions that focus on the entire country or a specific sector of the country’s economy, there is now a growing trend to use targeted or smart sanctions which focus on the leaders or political elites thought to be responsible for the objectionable action and/or behavior.  Instead of making the entire population accountable, smart sanctions reduce the costs to the targeted country and avoid unnecessary damage to civilians (Hufbauer & Oegg).

            Abolishing economic sanctions leaves the U.S. without a junction between military intervention and diplomacy.  While imperfect, they can send a strong message to erstwhile allies and hostile regimes if used skillfully.  The key questions that need to be asked are not about implementing sanctions but what are the goals of these sanctions and how will they be implemented? Will strong diplomacy be employed to make the sanctions more effective and what are the long-term implications as a result of these sanctions?   Certain sets of economic sanctions will always be necessary to deter or ameliorate certain sets of hostile actions such as the threat of terrorism or the desire to build nuclear weapons.  While the implementation of sanctions doesn’t always result in immediate results, they can be used as leverage to lessen the threats of unacceptable acts or behavior for the medium and long-term future.

                                                           Works Cited

Davis, Lance, and Stanley Engerman. "History Lessons Sanctions: Neither War nor Peace." Journal of Economic Perspectives Spring 17.2 (2003): 187-97. Web. 21 June 2014. <>.

Hufbauer, Gary C., and Barbara Oegg. "From Blunt Weapons to Smart Bombs: The Evolution of US Sanctions." Global Dialogue Summer 2.3 (2000): n. pag. Center for World Dialogue, 2000. Web. 21 June 2014. <>.

Taylor, Adam. "13 times That Economic Sanctions Really Worked." Web log post. Washington Post. The Washington Post, 28 Apr. 2014. Web. 22 June 2014. <>.

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