Thursday, June 11, 2015

It's Time to Kill the Feel-Good Myth of Sanctions


Isolating bad actors is a mainstay of US foreign policy. But it has not worked against Putin - and in an increasingly connected world, it's less and less likely to make a dent.

At the Group of Seven conference over the weekend, US President Barack Obama scored a victory in shoring up the G-7's fragile consensus for continuing sanctions to punish Russia for its shenanigans in Ukraine. The agreement, which stipulates that the sanctions will continues until Moscow decides to respect Ukraine's autonomy and the terms of a cease-fire accord are fully enacted, offers a temporary shot-in-the-arm for a policy approach that looks increasingly infirm. For though the impulse to isolate countries economically and diplomatically in order to punish errant deeds and impel better behavior - it has become a cornerstone of US policy on Russia, Syria, Iran, North Korea, and elsewhere - is nothing new, it has taken on added importance in this era of hesitancy toward foreign military intervention. As the fraught G-7 deliberations over extending sanctions on Russia shows, isolation now goes against the grain of a globalized world; it's hard to implement effectively and even harder to sustain over time. If it is to remain a useful diplomatic tool, policymakers need to adapt to its increasing limitations.


International diplomats and strategists have long had a fascination with isolation as a cure for geopolitical ills. In the late 1800s "splendid isolation" was a vision aimed to keep Great Britain free of entanglement in European affairs. As the world grew more connected, however, the prospect of a major country remaining aloof from global politics became more far-fetched. During the 20th century, as America's growing power and global interests ruled out the isolationism George Washington had extolled, isolation morphed from being a technique by which a country sequestered itself to a tactic for quarantining others. In the post-war period, isolation in various forms became a tool to try to influence nations such as Cuba, North Korea, Iran, Iraq, Burma, Libya, and Sudan. Though the United States never fully subscribed to the measures, the international isolation of both Rhodesia and South Africa during the 1980s was widely credited as a key catalyst to ending white minority rule.

The appeal of isolation is obvious. It offers a geopolitical equivalent of a social pattern as common to the kindergarten playground as to the United States Senate (and whatever may be in-between): When people misbehave, treat others poorly, or break rules, they are shunned and censured. The act of isolating is a way to express disapproval through deeds, not just words; it inflicts a visible punishment and discourages others' bad behavior. Moreover, it also averts contentious interactions between parties in conflict. And, at least sometimes, isolation can prompt the transgressor to recant and repent in order to win his or her way back into favor with the group.

In geopolitics, the theory also holds that the costs of isolation can weaken a regime to the point where internal opponents have a better shot at wresting away control. In response to a major international infraction - invading a neighbor, pursuing nukes, or perpetrating war crimes - isolation offers a compelling alternative to military reprisals, with the costs and risks they entail.

The Western effort to isolate Russia over the last year offers a vivid illustration of isolation's perks, but also its pitfalls. When Vladimir Putin annexed Crimea and mounted a proxy war in eastern Ukraine, NATO was caught off-guard. There was outrage at a brazen expansionism that violated the most basic premises of the post-World War II order, but an equally powerful instinct that launching a war to push Russia back would be folly. Isolation offered a way to make clear that the United States and Europe rejected Russia's actions without being drawn into armed conflict.

After claiming Crimea, Russia was promptly booted from the G-8 (turning it, once again, into the G-7). Between March and August, the United States, European Union, Japan, Australia, and others implemented successive rounds of sanctions that targeted energy, finance, trade, and defense ties, as well as individuals linked to Putin and his Ukraine policy. Though in April 2014, an EU factsheet declared that the "sanctions are not punitive, but designed to bring about a change in policy," in July of that year, as Obama announced stiffened measures, he heralded the sanctions as proving that "the United States means what it says. "He blamed Russia for" isolating itself from the international community. "

The sanctions have undoubtedly had an impact. The economic damage inflicted on Russia has been palpable; compounded by the damage wrought by a steep drop in global oil prices, the country's Standard & Poor's credit rating dropped to junk status earlier this year. The ruble plummeted by more than 50 percent during the second half of 2014 and a rebound is now faltering as sanctions look more likely to be extended. Late last year, the Russian economy was projected to shrink by more than 4 percent in 2015 and judged likely to remain in recession for 2016. In Britain, former Foreign Minister Malcolm Rifkind touted a new blacklist of officials no longer permitted to travel to Russia as proof that Putin is hurting.

For all the bluster, however, the policy tendered was less than the sum of its parts. Putin responded to sanctions not with contrition, but with counter-sanctions. Obama's reference to the international community isolating Russia was in large part wishful: China, India, Brazil, South Africa, and other non-Western nations never seriously considered following Washington's and Brussels' lead.

Most importantly, measured against the EU's stated objective of prodding a shift in Moscow's Ukraine policy, isolation earns poor grades. Russia failed to uphold its end of the Minsk II cease-fire, an accord negotiated in February that was meant to end the conflict in the Donbass region of Ukraine. In recent weeks, new evidence has emerged to substantiate Western claims of direct Russian involvement in stirring renewed violence in eastern Ukraine. Moreover, slowly recovering oil prices coupled with deepened economic ties to China, India, and others - efforts by Moscow to thwart the impact of current and potential future Western sanctions - may mean that the initial pain of sanctions will gradually wear off. A recent World Bank forecastsays Russia's economy is now looking up.

If anything, sanctions seem to have galvanized Putin in pursuing a spate of policies - everything from creating his own credit agency to financing European green parties that will oppose fracking and compound dependency on Russian oil - aimed to thwart his antagonists and undermine their efforts to isolate him.

With no sign of Russia knuckling under, the question becomes, how long can the sanctions and isolation continue and to what end?

Fissures have opened within Europe as countries, such as Italy and Greece, whose economies have suffered from lost European trade with Russia (a deficit estimated by Spain's foreign minister at $ 23.7 billion as of February of this year), have begun to question the policy. The EU can only extend sanctions with the consensus of its 28 members, meaning that each country enjoys a potential veto. US Secretary of State John Kerry's trip to meet with Putin two weeks ago for talks - mostly on Syria - was widely seen as a mark that Washington could ill-afford to not be on speaking terms with the Russian leader. (As Kerry put it, "there is no substitute for talking directly to key decision-makers.") And last week, the Pentagon turned to Congress to plead for the easing of sanctions that bar the import of Russian rockets essential to the most technologically advanced US defense and intelligence programs. Diplomatically, while Russia may be left out of the G-7, it remains part of crucial international forums including the six-party talks to end Iran's nuclear program. While Russia is not in the international coalition fighting the Islamic State, Iraqi Prime Minister Haider al-Abadi visited Moscow in late May to ask Putin to get more involved.

While the EU agreement to extend sanctions beyond the current late July deadline is being treated as an important litmus test of Western unity and purpose, it is unclear whether the patience of Putin and his people will run out faster than that of the Pentagon and the wavering members of the EU.

Though the Russian case is the highest stakes example of a policy of isolation coming under pressure, it reveals trends that will shape the viability of isolation efforts more broadly. Countries with modest global economic footprints, limited geopolitical significance, and few friends - including today's North Korea, pre-2011 Burma, and 1980s Rhodesia - are still relatively easy to isolate. Broad coalitions can be amassed to support the measures with limited sacrifice of national interests. But beyond those rare examples, cutting off one country inevitably has repercussions in a global economy. While major powers that see themselves as guarantors of international peace and security may be willing to absorb those costs, the calculus for smaller fringe European nations is different, rendering the EU's consensus-based decision-making structure a major hurdle. Moreover, in a world of global supply chains, countries threatened by isolation can more easily realign their trade relationships and gird themselves against punishment. As in the case of Russia and China's thickening ties, this can work to undercut Western leverage over time, meaning that isolation tactics are even less likely to bear fruit in future.
Globalization and the rise of transnational threats in particular also cut against diplomatic isolation. While Russia's global diplomatic and political influence make isolation virtually impossible, efforts to cut off Iran and Syria have also been bedeviled by the need to engage them both in the fight against the Islamic State. Some analysts also maintain that the US policy of isolating Iran proved a weakness in the campaign against al Qaeda in Afghanistan after 9/11.

On top of all this, there is mounting evidence that isolation often simply does not change countries' behavior.
Obama's decision late last year to reestablish relations with Cuba acknowledged what had been obvious for decades: Isolation had not reshaped the behavior of the Castro regime. Western countries and the Arab League isolating Syria in response to President Bashar al-Assad's brutal crackdown beginning in 2011 did not deter him in the least, and actually prompted both Iran and Russia to step up in his defense.

Yet some former Obama administration officials have argued that sanctions helped bring about the election of President Hassan Rouhani in 2013 and the opening of nuclear negotiations shortly thereafter. To the extent this played a role, the Obama administration's success in 2010 in securing a stiffened regime of UN sanctions - obligations shared by all countries in the United Nations' system - supports the idea that when isolation works, it is because it is as multilateral as possible. In a world where US, EU, Russian, and Chinese interests seem to increasingly diverge, the possibilities for universal, UN Security Council-sanctioned sanctions will never be the norm.

Except in those rare cases of broad international consensus, attempts to isolate can boomerang back at those trying to inflict the punishment, casting them as self-important and overbearing. The US embargo on Cuba has damaged Washington's relations with virtually the entire hemisphere, fueling the rise of anti-American leaders in places like Ecuador and Venezuela and making it impossible to contemplate stronger regional integration. In Russia, Putin has treated the West's cold shoulder as a badge of honor, using it to rally public opinion and burnish his own popularity.

Obama and German Chancellor Angela Merkel might know that isolating Russia may well be futile in the long run; without strong policy alternatives, sanctions allow leaders to signal resolve without having to come up with elusive new measures. A forthright acknowledgment of the constraints of isolation would force a more considered and realistic approach toward countries that break rules. To begin this process, the United States and its allies should acknowledge that isolation and partnership are usually not binary alternatives. Except in the case of small, unimportant countries, Washington and Brussels have too many diverse interests to declare entire sovereign nations economically, politically, and morally off-limits.

In the case of Russia, the United States and its European allies need to recognize that - at least as long as Putin is in power - Russian behavior will not be shaped by carrots and sticks. Instead, Western leaders should offer a hard-headed, compartmentalized relationship where, issue-by-issue, the West and Russia will cooperate where possible and confront one another where necessary - an isolation that is more tactical than principled, in which the rules will be reworked in accordance with their own interests. This will help avoid the Catch-22 of trying to diplomatically isolate a country essential to some of America's and the EU's most pressing diplomatic objectives. This also can help avoid a scenario where every concession to necessity can be cast as capitulation and retreat.

Part of the shift will be rhetorical. Rather than promising to isolate Russia entirely, something the United States and its allies can not achieve without the support of China, Brazil, India, and others, the administration could pledge to keep its distance, justifying Russia's exclusion from forums of the like-minded such as the G-7 (a place where Moscow arguably never belonged) but not implying that cooperation elsewhere will cease. While a more variegated approach might undercut the note of principled censure implied by wholesale isolation, moral condemnation is a role better suited to civil society groups, intellectuals, and advocates than it is to governments.

Western leaders should also acknowledge that isolation tactics are time-bound, and other measures aimed to safeguard Western interests need to be implemented while they're in effect. In this case, that means upgrading the defenses of NATO states on the Russian periphery; strengthening the ability of the Ukrainian government to govern, rebuild its economy, and defend itself; and mobilizing China, India, Brazil and others to call out Russia's ongoing destabilizing role in Eastern Ukraine. These measures will help avoid a scenario in which sanctions run their course and no alternative source of leverage is available to replace them.

Acknowledging that comprehensive, long-term isolation is not feasible also means shaping isolation measures so that they are sustainable and effective. Sanctions targeting individuals and corporations, including those that have restricted the movements and assets of members of Putin's inner circle are easier to maintain - they have fewer repercussions for sanctioning governments and innocent populations. Most regimes on the receiving end of sanctions are authoritarian states that concentrate power in very few hands that wield inordinate power. By confining sanctions to those most tightly tied to violations, Western nations can minimize collateral damage, including for themselves.


Still hungover from US military interventions in Iraq, Afghanistan, and Libya, yet not wanting to appear hamstrung in the face of breaches of international order, the United States and its allies have seized on isolation as a resolute and right-minded strategy for dealing with miscreant states. But to take full advantage of the potential of isolation, the West needs to face up to its limitations.

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