Ahead of last month’s summit of leading industrialized nations, known as the G7, President Joe Biden announced over 300 new sanctions on Russia in an effort to hamper the Kremlin’s military operations in Ukraine.

According to a deep dive by The Washington Post, the United States imposes three times as many sanctions as any other country or international organization. In recent years, the U.S. has expanded their use.

Jeff Stein, White House economics reporter at The Washington Post, joined “Marketplace” host Amy Scott to discuss some of the unintended effects of the wider use of sanctions in foreign policy. Below is an edited transcript of their conversation.

Amy Scott: You write about a good example of how sanctions can work in your story. Talk about what happened in 2003, when North Korea withdrew from a nuclear weapons treaty after a sanction was imposed.

Jeff Stein: This was a really pivotal moment in the explosion of U.S. sanctions as the key tool in U.S. foreign policy. And what happened was the U.S. Treasury Department realized that if they targeted an intermediary bank with which the North Koreans were trading, which was essentially processing payments for the North Koreans, they can really devastate North Korea’s finances and force them to withdraw from its nuclear testing attempts. So, this was a moment, as you identified in the early 2000s, when the U.S. government really started to see this tool as something that could accomplish its foreign policy objectives while leading to, at least in theory, little collateral damage and not requiring any boots on the ground or really any foreign intervention with U.S. military.

Scott: How have sanctions evolved since then? It seems with every president, there are more economic sanctions.

Stein: It’s really worth thinking back to where we were as a country during the [President George W.] Bush era. We had two wars that were widely regarded, I think it’s safe to say, as disastrous for the U.S. And in that context, there was an opening for a tool through which the U.S. could exert its foreign policy influence on all parts of the world with less apparent costs. And as you said, the numbers are just a hockey stick graph where you see really only a few hundred sanctions applied per year under Bush. President Biden has imposed 6,000 sanctions in 2021 and 2022. From Bush to [President Barack] Obama, to [President Donald] Trump to Biden, every president has imposed somewhere between 25% and 75% more sanctions than their immediate predecessor. So, the trend has just only pushed in that direction.

Scott: And yet, as you give many examples of in the story, they haven’t really achieved their primary goal. I mean, you talk about Cuba, Iran, Syria, obviously Russia after its invasion of Ukraine, those regimes have remained intact despite escalating sanctions. Why haven’t they been more effective?

Stein: What we’ve seen in case after case when the U.S. tries to force out an autocrat with economic sanctions, foreign leaders have gotten smarter and smarter about using the economic sanctions from the U.S. to consolidate their own power. And so rather than seeing sanctions punish the bad actor, often we see them end up hurting the civilian populations, vulnerable people who need food, medicine or other economic activities that are cut off from the sanctions. Or they impact private-sector leaders or business leaders that allow the dictators and regimes to step in and take over more of civil society and consolidate their authority. And that has become a huge problem for people who want to use these tools for good in the world.

Scott: You also talk about how the system of sanctions has spawned a multibillion-dollar industry around it. And you give some examples of how sometimes, this is less of a foreign policy tool than just an effort to cut off foreign competition.

Stein: That’s exactly right. There are billions of dollars now in Washington that are being sloshed around, particularly among former U.S. government officials, who take their expertise in the sanction system to foreign governments, and these former government officials will say, look, I have buddies who are still in the U.S. government. If you hire me, if you pay me, in some cases, millions of dollars, I will go to the government and my former colleagues and lobby them and get them to maybe do a different course of action or take sanctions in a different direction. And so, it raises the question of whether this tool that has at least nominally just been about U.S. foreign policy, is it being corrupted or being manipulated by who can spend the most in the D.C. lobbying system?

Scott: There is a movement to rethink how we do sanctions. What are some of the alternatives?

Stein: There’s really two obvious answers. One is war. And I think most people would say that insofar as we do sanctions instead of war, maybe this is still a tool we want to depend on. But the alternative a lot of people would say is that we should be pushing more towards diplomacy. Or maybe we should view America’s role in the world differently. After Iraq and Afghanistan, there was a quite loud call to say America should not be the world’s policeman, that we should not be the cop bestriding every continent and telling people what to do. But that’s really difficult. It’s really hard to be the president of the United States or to be the Treasury secretary or the secretary of State and know that you might have the power to deter some horrible thing happening in Africa or Latin America or wherever and to be OK with not taking action. So the ability of the U.S. government to respond without causing collateral damage is minimal, but the alternatives are also very difficult and to some, unpalatable.

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