Broad, Unclear US Sanctions Strategy Confusing Allies, Panelists Say

The broad range of U.S. sanctions are confusing U.S. allies, seem to have no clear goal and could damage future administrations' ability to levy sanctions, several experts on U.S. sanctions said. The U.S. actions are also allowing countries to create sanctions immunities and leading to divisions in Europe, they said, criticizing the Trump administration’s lack of planning for potential consequences.

“Is it Iran today, Venezuela tomorrow? North Korea? There's such confusion,” said Heather Conley, director of the Europe Program at the Center for Strategic and International Studies. “What are we supposed to do first, and will there be consistency? That’s what's missing in the U.S. approach.”

Speaking during a July 31 CSIS panel, Conley said the U.S.’s overuse of sanctions has become a substitute for foreign policy. “We are unable to articulate a policy that looks at the long-term desired change,” she said. “Sometimes we just simply turn to sanctions because we want to do something. We want to express our policy discontent with an actor.”

That seems to be the case in Iran, said Jon Alterman, director of CSIS’s Middle East Program. The Trump administration's maximum-pressure campaign on Iran has included sanctions on the country’s military, supreme leader’s office and spokesman, who the Treasury Department sanctioned July 31 (see 1907310068). “When you’re not really sure what to do, you come up with different sanctions, and you come up with sanctions against different people,” Alterman said. “It feels to me that sanctions, rather than providing us a pathway to somewhere different, are a tool to say we’re going to do something, but really don’t move us.”

Before the panelists spoke, Treasury Undersecretary for Terrorism and Financial Intelligence Sigal Mandelker addressed the criticism but defended the U.S. sanctions policy, saying they are being used “very pointedly, very strategically” (see 1907310042). But panelists disagreed, pointing to Russia as an example of where U.S. sanctions have no clear goal. “We have so many actions against so many bad acts that the Kremlin has done, but what do we want to fix first?” Conley said. “We’re whacking them across the board, but are we trying to produce something? And that’s what’s absolutely unclear.”

Because the sanctions are unclear, U.S. allies are becoming increasingly confused and unable to predict future U.S moves, leading to little collaboration, the panelists said. This has caused differences in U.S. and European Union sanctions, which are hurting private industry (see 1907290035) and causing divisions in Europe.

The creation of INSTEX, the European payment system designed to allow countries to trade with Iran despite U.S. sanctions (see 1907030047), is a “powerful indicator” that the U.S. and EU sanctions approaches are increasingly diverging, Conley said. “We need to get back to a place where our allies are supporting the U.S. policy vision,” she said, “but they have to know the policy vision.”

Several panelists said U.S. sanctions have led to Russia’s decoupling from the global economy, evidenced by the country’s Nord Stream 2 gas pipeline project, which Congress is considering sanctioning (see 1907310053). But Congress’ desire to sanction Russia, coupled with its mistrust of the Trump administration's ties to the country, has led to strong legislative pushes to pass sanctions packages that may leave the administration, or future ones, with “little wiggle room” to lift the measures, said Jeffrey Mankoff, deputy director of CSIS’s Russia and Eurasia Program. “This approach really does risk becoming the new normal, one that’s going to be part of the way the United States engages with Russia even under a future administration, even when the basic landscape has changed.”

Another danger of the U.S.’s broad and frequent use of sanctions is the dulling of their impact, Alterman said. “It’s like immunizations, like antibiotics,” he said. “If you keep doing it a little bit by little bit, people develop work-arounds and immunities. I think we are in danger of getting into that space.”

In Venezuela, however, U.S. sanctions have effectively constricted the oppressive Nicolas Maduro regime and forced it to negotiate with the opposition party, led by Juan Guaido, said Moises Rendon, director of CSIS’s The Future of Venezuela Initiative. But Rendon also said the U.S. needs a multilateral approach to force change. “Sanctions policy is only a tool,” he said. “The more we engage Venezuela in a more comprehensive, more broad way -- that’s very important.”

Conley suggested the U.S. change the way it imposes sanctions to stop countries from finding “work-arounds.” Instead of a “slow ramp-up” of pressure, the U.S should “think about a fast and devastating approach to start getting their attention, getting them to the table.”

“This is a radical approach, and we’d have to be prepared for that,” she said. “But it’s an idea rather than the slow burn.”

More importantly, Conley said, the U.S. needs to plan its sanctions strategy several moves ahead instead of imposing broad measures that lack a clear purpose. “We’re doing the quick and easy, ‘we’re gonna do something, I feel better about myself,’” she said. “But we’re really changing the strategic picture, and we have to really recognize that.”