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Why Economic Sanctions Often Fail

by Matt Jacobs on Jun 28, 2008

Matt Jacobs

On his recent trip to Europe, President Bush pushed the Continent's top leaders to adopt tougher economic sanctions on Iran, a step that, since then, they have announced. Yet there's every reason to believe that the president's visit, even coupled with European sanctions, will not produce results.

European nations have supported sanctioning Iran in the past, but they have continued to have strong trade links with the Iranians. With Bush's presidency close to an end, time is running out for concrete agreements between his administration and European leaders.

What's more, the history of economic sanctions as a tool of foreign policy reveals that they have rarely achieved success. Just look at the long-time failed American economic sanctions against Cuba, in place since 1960, shortly after Fidel Castro took power. They have done nothing to soften Cuba's anti-American stance, and they have failed since their inception to attract the support of other nations.

The policy of economic sanctions is bound to be unproductive when a consensus among allies is not reached. The policy toward Cuba is a prime example. Early in his presidency, John F. Kennedy failed to gain the co-operation of allies when implementing economic sanctions toward Cuba. In 1962 Kennedy further tightened sanctions by restricting travel and trade to the island, but these restrictions did little in the way of injuring the Cuban economy.

In the years immediately following, Castro engaged in trade with Great Britain, France, Italy and Spain, all American allies in Europe. The British, with whom the United States has long enjoyed a "special relationship," supplied Castro's government with several hundred buses as well as a seven million dollar line of credit.

On the issue of Iran, President Bush has been calling for harsher economic sanctions since the beginning of his second term. In 2006 Bush reaffirmed the Iran Sanctions Act, which threatens sanctions against any country that engages in trade with Iran. European nations have ignored the president; European trade with Iran has increased substantially since 2006.

For instance, more than five billion dollars' worth of German goods were exported to Iran in 2007. Switzerland's Swiss EGL energy trading company recently completed a forty-two billion dollar agreement with the National Iranian Gas Export Company.

Though European leaders said the right things on President Bush's recent visit, it remains to be seen if Europeans will carry through with tougher sanctions. Whether the U.S. policy of economic sanctions against Iran will be a success hinges on the full application of the policy Europe has recently announced. The president's recent and likely last official trip to Europe may prove to be nothing more than European leadership telling a lame-duck U.S. President what he wants to hear.

Bush's last months in office will determine how effective sanctioning Iran can be. Economic sanctions against Cuba, enacted more than 40 years ago, have failed because of a lack of commitment among allies. The same fate awaits the United States today regarding Iran if U.S. and European policies are not completely unified. Without full cooperation, the policy of economic sanctions is rendered useless.


Matt Jacobs is a Ph.D. student studying diplomatic history at Ohio University.