Kimberley Ann Elliott. International Security. Volume 23, Issue 1, Summer 1998.
In “Why Economic Sanctions Do Not Work,” Robert Pape sets up a straw man and then boldly proceeds to knock it down. His target is an “emerging optimism” about sanctions, which in his oversimplified characterization says that economic sanctions—used in isolation from other tools—are “as effective as military force and more humane” (p. 90). But policy analysts—and certainly policymakers—who are looking for ways to strengthen sanctions and make them more effective are generally far more nuanced in their conclusions and more limited in their expectations of what sanctions can achieve than Pape asserts. And in the wake of the experiences in Iraq and Haiti, few suggest that economic sanctions are necessarily more humane or that their use can be justified regardless of the humanitarian consequences.
While my disagreements with Pape’s methods are many, the Hufbauer, Schott, and Elliott (hereafter HSE) bottom line on the utility of economic sanctions is not terribly different. Although Pape cites our work as the “key evidence” supporting the perceived optimism that sanctions can achieve major foreign policy goals, he never cites our own interpretation of the evidence. We concluded that “although it is not true that sanctions ‘never work,’ they are of limited utility in achieving foreign policy goals that depend on compelling the target country to take actions it stoutly resists. … The success rate importantly depends on the type of policy or governmental change sought” (HSE 2d ed., vol. 1, pp. 92-93). Moreover, we found that the utility of sanctions had declined sharply over time, with less than one in four sanctions having any success at all in the 1970s and 1980s (ibid., pp. 105-106), even fewer when the United States acts unilaterally.
Nevertheless, the flip side of declining utility is that economic sanctions, in our judgment, were a relatively effective tool of U.S. foreign policy in the early post-World War II era. Although increasing international economic integration and declining political hegemony have eroded U.S. leverage, just over half the episodes in which the United States took a leading role from 1945 to 1970 resulted in at least partial success. In that context, our research can be used as a source for ideas about how to strengthen sanctions and make them a more effective foreign policy instrument.
In order to knock down the straw man he has created and prove his assertion that sanctions cannot work, Pape must debunk the evidence that sanctions have ever worked. He argues that my colleagues and I wrongly counted as sanctions successes 35 of 40 cases, and that 5 successes is far too few to be optimistic about sanctions ever being effective. Pape arrives at this conclusion, however, by defining sanctions so narrowly and setting the bar for success so high that, indeed, few cases reach the threshold. He excludes cases where economic pressure is intended to complement military force, and he attributes policy success to economic sanctions only if it occurred in the absence of accompanying policies, such as military threats or covert action. He then concludes that “economic sanctions have little independent usefulness for pursuit of noneconomic goals” (p. 93).
But whether sanctions alone could achieve foreign policy goals is not the question we addressed, and our research cannot be called flawed because it arrives at a different answer than Pape’s. We began work on the first edition of Economic Sanctions Reconsidered (1985) in the early 1980s, in the wake of the Carter grain embargo and the Reagan pipeline sanctions, when the conventional wisdom was that sanctions never work. We were interested in finding out, first, whether this was true, and, second, under what circumstances economic leverage might be useful—not necessarily dominant—in achieving foreign policy goals.
Analyzing whether and how sanctions contribute to foreign policy outcomes, rather than whether they cause them, leads to important differences in research method. First, we do not confine ourselves to the question of whether sanctions are an effective alternative to military force. Therefore we deliberately include “economic warfare” cases where the goal of sanctions is to indirectly affect the target country’s behavior by impairing its military capability—whether during wartime or during the “cold” competition marking the U.S.-Soviet rivalry (see Pape, p. 94). Second, we never expected to find slam-dunk successes, and we deliberately set a fairly modest standard for judging both the degree of policy success and the contribution to that outcome made by sanctions. In our analysis, sanctions do not have to be the only or even the primary factor in producing a positive foreign policy outcome.
Even though we use a relatively modest standard for judging success, it is simply not true, as Pape asserts, that we ignore alternative explanations. One of our independent variables for explaining policy outcomes is the use of “companion policies,” such as regular or “quasi-military” action or covert activity. We explicitly take into account the presence of these other policies and call an episode a sanctions success only if sanctions—relative to these other tools—contributed at least modestly to the outcome. Thus the primary difference between ourselves and Pape in assessing the effectiveness of sanctions comes about not because of a flaw or error in our analysis but because of differences in research design.
Although we may reconsider our scoring of three or four cases in light of new sources or alternative interpretations suggested by Pape, we stand by our judgments in the vast majority of the 35 cases challenged. In the two sections that follow I discuss the main sources of disagreement: first, the definitional question of what should be included in an analysis of economic sanctions; and, second, the degree of causality that can be attributed to sanctions relative to other instruments, especially military force. In the second section I note as well a few cases where I believe Pape simply overreached in trying to prove that sanctions do not work. I conclude with a discussion of the obstacles that must be overcome in making economic sanctions an effective tool of foreign policy after the Cold War.
Defining Economic Sanctions
As Pape notes, we largely agree on what the definition of an economic sanction ought to be. The disagreements arise over whether to include “military impairment” cases and, at the other end of the spectrum, whether some cases should be included because the commercial issues involved actually mask broader political disputes.
As noted, we have not confined our research to the utility of economic sanctions as an alternative to military force. Therefore we believe it is legitimate to include sanctions intended to buttress military power and hasten an adversary’s defeat. In that context, we judge sanctions as a success if they contributed to victory by inhibiting the ability of the target to effectively carry on military operations, as in World Wars I and II. Sanctions by Nigeria against Biafra and by the United Kingdom against Argentina in 1982 were also judged against this more modest standard. In these cases we agree that military force was decisive in determining the outcome, but we also believe that sanctions made a useful contribution by rendering the target’s military capability less effective than otherwise, accelerating the timing of the outcome and lowering the cost of achieving the sender country’s goals.
The second definitional difference is over six cases that Pape argues should be excluded because they are normal commercial disputes. Four cases—the United States and the United Kingdom versus Mexico (1938), France versus Tunisia (1964), the United States versus Ceylon (1961), and the United States versus Peru (1968)—involve nationalization by the target country of property owned by citizens of the sanctioning country. We included them because nationalization is typically a highly politically charged act that is intended to send a signal of independence and nationalism not only to domestic constituents but also to the home countries of the property owners affected. This signal is often interpreted by the sanctioning country as evidence that the target government is moving in a direction inimical to the broader interests of the sanctioning country. Agreement by the target country to provide compensation is then accepted as an indication that it is willing to play by the basic rules of the international game not just in the commercial arena but in the geopolitical one as well.
Thus we continue to believe that expropriation disputes are qualitatively different from other disputes arising from commercial sources. We also continue to feel that there was a real if limited foreign policy goal in the case involving Chilean copper-pricing policy in 1965. The ultimate goal was containing inflation in the U.S. economy, but Chile’s cooperation in capping the price on copper exported to the U.S. market was viewed as essential, and both goals were achieved through a combined strategy of carrots and sticks.
Finally, there should be little controversy regarding the “Nightfrost Crisis” provoked by Soviet pressure on Finland in 1958. As far as I am aware, Pape is alone in interpreting this episode as no more than a commercial dispute. Each of the sources cited by him (and by us) interprets Soviet economic pressure as seeking to ensure that Finland did not get too close to the West politically. Kent Forster, for example, says that “knowledgeable observers in Helsinki perceived that the Soviets feared the Finnish westward orientation was motivated by more than economic considerations. Moscow refused to concede that western automobiles might be preferred to Russian models and introduced political issues.” Similarly, John Vloyantes characterizes the central issue in the dispute as ascertaining “the level of tolerance in Moscow for the free functioning of the Finnish political system.” Moreover, Soviet economic pressure did contribute to a change in government in Finland more to its liking, though not to the extent of including communists in the cabinet (HSE 2d ed., vol. 2, pp. 178-181; Pape, pp. 131-132).
Defining Success
Pape’s approach to the confluence of military and economic force is akin to the archetypal air force general who would like to attribute victory in World War II, and every war since, to air superiority. In many of the cases involving either a threat or actual use of military force, we agree that military force was decisive in determining the outcome. But economic and military pressure can act together synergistically—just as naval and infantry forces usually work with air power—so that goals can be achieved at acceptable political, military, and economic cost. In cases combining economic and military measures, we believe that some degree of success may be attributed to sanctions if they contributed at least modestly to the outcome. This might be, for example, by increasing political opposition to the target regime or impairing its capability to respond to military challenges by opponents. Sanctions can also serve as a tangible signal: either that support for opposition forces is explicit or that support for the ruling regime has been withdrawn.
Overall, in cases involving both economic and military pressures, we believe that a full assessment of the utility of sanctions requires a more careful consideration of the counterfactuals than Pape gives them. For example, we agree with Pape that the intervention by Tanzanian forces in Uganda in 1978 was decisive in destabilizing Idi Amin. But if, as suggested by Judith Miller, Tanzania would not have intervened in the absence of economic sanctions by the United States, those sanctions served a useful purpose. Moreover, if the shortages created by the U.S. oil company embargo contributed to Amin’s inability or unwillingness to stand in against Tanzanian and rebel forces, we would again regard that as a modest success for sanctions (HSE 2d ed., vol. 2, pp. 330-335).
Similarly, we agree with Lars Schoultz, who has studied the overthrow of Presidents Joao Goulart in Brazil and Salvador Allende in Chile and concludes that the interruption of U.S. aid did not by itself cause the coups but that, in conjunction with other measures, it did contribute to the achievement of U.S. goals. The withdrawal of financial resources in these cases made it more difficult for the two regimes to deliver on promises made to key constituencies and exacerbated the macroeconomic consequences of expansionary macroeconomic policies. Similarly, in cases targeting Anastasio Somoza in Nicaragua, Rafael Trujillo in the Dominican Republic, Desi Bouterse in Suriname, Ngo Dinh Diem in Vietnam, and various governments in Laos, sanctions emboldened the opposition and, by depriving the target government of economic resources, made it more difficult to confront domestic insurgencies (ibid., pp. 452-456, 182-187, 546-551, 260-266, 160-167). Again, if the economic pressure, in combination with military pressure, contributed to goals being achieved sooner or at lower cost than otherwise, we would regard sanctions as having played a useful role in the outcome.
Economic pressure can also contribute to the achievement of related goals after the new regime is in place. After the 1950s destabilization of the government of Mohammad Mossadegh in Iran, the economic vulnerability resulting from reduced export revenues contributed to the achievement of other British and American goals. After being restored to power, Shah Mohammad Reza Pahlavi acceded to demands for the involvement of Western oil companies in Iran’s industry and 50-50 profit sharing (ibid., pp. 115-118).
In the Rhodesian case, British policymakers initially expected that economic isolation would be sufficient to coerce the minority white government to reverse its “unilateral declaration of independence” and resume negotiations toward majority rule in Rhodesia (ibid., pp. 285-293). As a result of lax enforcement and the defection of Portugal and South Africa, however, Rhodesia was never effectively isolated and the sanctions thus had less impact than expected. As Pape notes (p. 101), this case has been widely studied but there is no consensus in the literature on the role of sanctions. We are by no means alone in concluding that although military force was decisive, the increasing impact of sanctions over time increased the pressure on the white regime and ultimately contributed in a modest way to the desired outcome.
There are also eight cases where Pape argues that, whatever the role of sanctions, the value of the concessions made was trivial and therefore they should not be counted as successes. We would agree that in many of these cases the foreign policy gains were rather modest and in some cases ephemeral. Nevertheless, recalling that we have not limited our research to the effectiveness of sanctions in achieving ambitious goals or serving as an alternative to military force, we believe it is important to point out that modest sanctions have at times achieved modest objectives.
It is also important to be clear about the goals that were being sought by policymakers using sanctions. In several of these cases I believe that Pape judges the achievements of sanctions against standards they were never intended to reach. For example, in the early 1980s when the Reagan administration imposed sanctions against Poland for the crackdown on the Solidarity union movement, it never expected that the sanctions would bring democracy to Poland. But U.S. and European sanctions did contribute to the more limited intermediate goals of easing the level of repression and the release of Solidarity activists and other political prisoners (HSE 2d ed., vol. 1, pp. 192-204).
Finally, there are several cases where Pape bends so far backward trying to prove that sanctions do not work that he strains credulity. These and other cases where we have the strongest disagreements with Pape are discussed in the appendix to the article, but a few cases are briefly noted here. For example, Pape argues that our most egregious error is in the case involving League of Nations intervention to resolve the border dispute between Greece and Bulgaria (1925). He asserts that sanctions were discussed by the League and rejected in favor of a naval demonstration. In fact, no final decision on action was taken by the League nor any public threat ever made. So the Greeks could not be sure what action might be taken against them. But according to a communication from the Greek representative at the League to his government just before the decision to comply with League demands was made, what the Greek government anticipated and feared was an economic blockade.
In the case involving U.S. pressure on the British and French to withdraw their forces from Egypt during the Suez crisis of 1956, Pape appears to be alone in attributing a large role to a Soviet ultimatum containing an ambiguous nuclear threat. Richard Betts, who has studied several cases of nuclear blackmail during the Cold War, concludes that the ultimatum was never taken seriously by U.S. policymakers and that it had little or no impact on the outcome. In the case involving U.S. sanctions against Taiwan in the 1970s because of nuclear proliferation concerns, Pape simply misunderstands the facts. And in the Iranian hostage case from 1979 to 1981, he focuses on the details of the hostages-for-assets agreement, misses the distinction between compensation and settlement of commercial claims, and ignores the broader bargain in which U.S. sanctions were lifted in exchange for the freeing of the hostages. Further discussion of all these cases can be found in the appendix.
Sanctions after the Cold War
Judged against a realistic standard, it is not true that sanctions have never worked. It is true that unilateral sanctions as imposed by the United States in recent years have only rarely worked, with just 5 of 39 unilateral U.S. sanctions achieving any success at all between 1970 and 1990. It is also true that economic sanctions used independently of other policy tools typically achieve only relatively modest and limited goals.
Contrary to Pape’s assertion, however, sanctions are seldom expected to achieve ambitious foreign policy goals in the absence of other policy tools. Nor should they be. Sanctions can be effective only if they are part of an overall coherent policy including skilled diplomacy and, where appropriate, credible threats of additional force if compliance is not forthcoming. As former U.S. Ambassador to the United Nations (UN) Donald McHenry noted recently in the context of a discussion of policies for preventing deadly conflict, economic sanctions may be an alternative to the indiscriminate use of force. However, in situations that are sufficiently serious and where the foreign policy objective is important, the possibility must be clearly communicated to the target that force will be used if necessary—to enforce the sanctions, to strategically buttress their effects, or as a last resort if sanctions fail. Sanctions imposed as an alternative to force because the political will to use force is lacking are not likely to be credible and therefore are not likely to be successful.
As with the task force on which McHenry served, the renewed attention to sanctions reflects a desire to find more effective tools for dealing with ethnic and other violent conflicts and for responding to egregious human rights violations around the world. Given declining foreign aid budgets and combined budgetary and political constraints on the use of military force, analysts and policymakers are reexamining economic sanctions to see whether and how they might be useful in dealing with the foreign policy challenges of the post-Cold War world.
To the extent that there is a degree of optimism today about the potential effectiveness of sanctions, it is likely because of the perception shared by many that broad multilateral sanctions helped to end apartheid in South Africa, have forced Iraqi President Saddam Hussein to cooperate grudgingly (and sporadically) with the UN inspectors seeking to destroy his weapons of mass destruction, and induced Serbian leader Slobodan Milosevic to come to the negotiating table in Dayton, Ohio. Here the optimism is based on the fact that, with the end of the Cold War, it may now be possible for the United Nations to take action in defense of collective security and to protect international norms, as was originally intended. The hope is that multilateralism, combined with the relatively greater legitimacy accorded to UN enforcement actions, may restore to sanctions the leverage that they had when the United States was the dominant economic and military power in the Western world.
Any optimism about the utility of sanctions in the post-Cold War world should probably be tempered, however. First, the picture is a mixed one. In Iraq and the former Yugoslavia, full achievement of UN goals remains elusive. Saddam Hussein continues to put roadblocks in the way of the UN inspectors trying to find and destroy any biological weapons capability, and the progress made in putting Bosnia back together could easily dissipate in the face of continuing tensions. Air strikes and military threats also appear to have played important roles in these cases, again suggesting that a combination of economic and military pressure will often be required to achieve the most difficult goals (HSE, 3d ed., forthcoming). In Haiti, broad multilateral sanctions completely failed to achieve their goals, and the imminent arrival of U.S. military forces was required to convince the military government to step down in favor of the legally elected government of Jean-Bertrand Aristide. The Haitian case is also an example of how ill-conceived and poorly implemented sanctions can make a bad situation worse and underscores the fact that sanctions are a tool of policy and cannot succeed alone when the policy they serve is incoherent or inept.
Second, increased economic integration and interdependence is a double-edged sword for economic sanctions. To the extent that potential target countries are more dependent on international economic exchange than previously, the more vulnerable they are to economic coercion. At the same time, however, globalization of economic activity means that there are many more suppliers for most goods and services and many more potential markets for a target’s exports. This in turn means that international cooperation is more important than when the United States was a far more dominant supplier of trade and finance than any single country is today. Increased integration also means that the impact of nearly universal and comprehensive sanctions can be quite severe and can raise concerns about the humanitarian consequences for people in target countries who have little control over or influence on policy. It also raises concerns about the costs borne by key neighbors and trading partners in enforcing sanctions.
These elements together mean that effective sanctions are likely to be costly in political and economic terms. Whether the coalition is ad hoc or organized under the rubric of the United Nations or a regional organization, political capital will have to be expended to build it. Resources will have to be devoted to enforcement at the same time that other resources may be necessary to mitigate the most severe effects of broad, multilateral, well-enforced sanctions. The greatest barrier to making economic sanctions an effective foreign policy tool is not inherent in modern political or economic systems; it derives from the lack of political will on the part of key leaders around the world. Until there is some evidence that such will can be generated, the sanctions glass will remain at best half full.
Appendix
The case numbers below are those used to identify the cases in HSE, 2d ed. The first part of the number refers to the year in which the case was initiated. Except for 79-1, U.S. versus Iran, all of the cases discussed below are contained, in chronological order, in HSE, 2d ed., vol. 2. U.S. versus Iran is in vol. 1, pp. 153-162.
Case 21-1: League of Nations versus Yugoslavia
This case involved a border dispute in 1921 in which Yugoslav troops occupied northern Albania. After months of delay by the Conference of Ambassadors (representing Britain, France, Italy, Japan, and the United States), the British government called on the League to consider economic sanctions if Yugoslavia did not immediately withdraw. Shortly after, Yugoslavia withdrew its troops. Pape argues that the nearly simultaneous decision by the Conference of Ambassadors to retain the existing delineation of borders and to authorize Italy to intervene to protect Albania’s territorial integrity was an implicit military threat aimed at Yugoslavia and the key causal factor in Yugoslavia’s withdrawal (p. 114). But three different accounts of the case attribute Yugoslavia’s acquiescence to the threat of economic sanctions. The implicit military threat, in reality, was against Albania, which eventually was annexed by Italy in 1939.
Case 25-1: League of Nations versus Greece
In this case, involving a border dispute between Greece and Bulgaria, Pape asserts that the League “rejected economic sanctions in favor of a naval demonstration” (p. 115). According to the most detailed account of the case, however, both options were discussed in a private meeting of League Council members. Francis Walters’s history of the League concurs that no public threat was ever made. Pape is correct that League members in that meeting preferred a naval demonstration as a first step (because economic sanctions were considered too strong a response); however, no decision regarding what action to take was made, nor was there any public announcement of the options discussed. The Greeks announced the next morning that they would comply with the League’s demand to withdraw. According to a message sent to his government in the midst of the crisis, the Greek representative at the League deliberations warned that failure to comply with League conditions might result in the League adopting a “complete economic blockade” of Greece. With no public threat ever made, this is the only evidence we have of the anticipated action that induced Greek compliance.
Case 48-1: U.S. versus Netherlands (Indonesian Independence)
In this case, it is true that the Netherlands could not have prevailed militarily in Indonesia at an acceptable economic and political cost. It is far less clear, however, that the Dutch government had reached that conclusion in the spring of 1949. The U.S. threat of aid sanctions apparently was made to the Dutch foreign minister on a trip to Washington in late March. Two weeks later, the Dutch government agreed to return to the negotiating table and to comply (grudgingly) with the demands of the January UN Security Council resolution to cease military operations, release political prisoners, and facilitate the return to Jakarta of representatives of the Republic of Indonesia. The quotation Pape (p. 134) cites about declining political support in the Netherlands for government policy in Indonesia came several months later during the negotiations over the details of the transfer of power to an independent Indonesian government.
Although Pape is correct that military defeat would likely have produced the same outcome eventually, we would regard the acceleration of that outcome and the accompanying reduction in conflict—as sufficient grounds for counting this case as a success. Pape also argues that economic pressure could not have been very important in determining the outcome because evidence of a credible U.S. threat is lacking. He notes that U.S. interest in recovery in Europe had higher priority than did opposing colonialism in the developing world. Although this was true, U.S. Senate pressure on the Indonesian independence issue threatened to hold up the entire economic and military assistance packages for Europe, thus giving the State Department an incentive to pressure the Netherlands in order to save the broader policy.
Case 56-3: U.S. versus U.K. and France (Suez Crisis)
Pape asserts that Soviet nuclear threats against the United Kingdom and France, not American financial pressure, caused those countries to agree to a cease-fire and to withdraw their forces from Egypt following President Gamal Abdel Nasser’s nationalization of the Suez Canal. Pape argues that France and the United Kingdom took the threat quite seriously and implies that U.S. President Dwight Eisenhower was ambiguous when pressed by the allies for assurances that the United States would respond in case of a Soviet attack (p. 115).
The picture drawn in Richard Betts’s study of this case as an example of nuclear blackmail is quite different. Betts argues that U.S. policymakers regarded the Soviet threat, which in full is more ambiguous than the excerpt quoted by Pape, as bluster. Nevertheless, the American supreme commander in Europe immediately and publicly announced that any Soviet attack would be met with an immediate and massive response. U.S. officials also apparently reassured the British and French that they regarded the threat as a bluff. Betts concludes that “there are no persuasive grounds for assuming that the ambiguous nuclear elements in either superpower’s signals had a meaningful impact on the outcome because the military results on the ground—determined largely by U.S. pressure on its allies—was acceptable to both Moscow and Washington.”
Moreover, that threat faded quickly and cannot explain the British and French acquiescence a month later to the U.S. demand that they withdraw their troops from Egypt quickly and completely. Once the cease-fire was in place, President Eisenhower’s primary goal was maintaining the goodwill created in the Arab world by his opposition to the use of military force against Egypt. That, in his view, required complete and rapid withdrawal of British and French forces. This was the objective of the financial pressure brought to bear on Britain during the remainder of the month of November.
In discussing the role of the impending sterling crisis on British decision making, Pape focuses on the role of market forces and the lack of evidence that U.S. officials sold large quantities of British pounds. He argues that, therefore, the impact of U.S. financial pressure was not important. There is no mention in Pape’s account, however, of the oil shortages created by blockage of the canal or the additional economic pressure on Britain created by the U.S. refusal to operationalize plans for mitigating those shortages. In addition to refusing to cooperate in offsetting the oil shortages and impeding Britain’s access to resources from the International Monetary Fund, the United States also refused to discuss forgoing or delaying upcoming British debt repayments, much less the possibility of providing new loans or other assistance. Further, Pape does not discuss the evidence presented in Diane Kunz’s thorough analysis of the crisis that the British knew all along that their position was untenable without American financial assistance and that they badly miscalculated the depth of U.S. opposition to the use of force against Nasser.
Case 76-2: U.S. versus Taiwan (Nuclear Proliferation)
In this case, Pape apparently misunderstands the facts. The U.S. goal was to prevent Taiwan from reprocessing spent nuclear fuel into plutonium, which could then be used in nuclear weapons. After the United States successfully pressured Taiwan to dismantle a small-scale reprocessing facility in the 1970s (while allowing it to continue to operate a research reactor), suspicions were revived in the late 1980s that Taiwan was pursuing a reprocessing facility. Apparently relying on Leonard Spector’s analysis of these events, Pape (p. 129) asserts that the original case was a failure because Taiwan had secretly continued reprocessing all along and had accumulated enough plutonium for ten nuclear bombs. What Spector actually says is that Taiwan had accumulated enough spent fuel from its operation of the legal and fully safeguarded research reactor for ten bombs if the plutonium could be extracted. Although Spector says that the United States continued to have suspicions about Taiwan’s nuclear activities throughout this period, there is no available evidence that Taiwan was able to reprocess spent fuel after the hot-cell facility was shut down in the 1970s. We therefore stand by our assessment of the earlier case as well as the decision not to add a new case for the 1988 episode because there is no evidence that U.S. pressure at that time involved economic threats.
Case 79-1: U.S. versus Iran
In the Iranian hostage case in 1979-81, Pape (p. 130) discusses the negotiations over the terms under which the United States would release frozen Iranian assets as though they were disembodied from the sanctions imposed by the United States as part of the strategy for gaining the hostages’ release. The details of the agreement, however, do not affect the basic bargain under which the hostages were freed and the assets were unfrozen. Pape also confuses compensation and pre-sanctions commercial claims when he asserts that the agreement “barred U.S. firms from seeking compensation from Iran” (p. 130). The agreement barred claims for compensation by the hostages and barred firms from litigating claims against Iran over preexisting contracts or debts in U.S. courts. But the agreement did provide for a portion of the frozen assets to be used to pay U.S. creditors and provided for an arbitration process at The Hague to deal with other claims.
Robert Carswell, deputy secretary of the U.S. Treasury during the crisis, concludes that “the blocked assets proved a key bargaining chip in obtaining the hostage release.” He concludes further that “the ensuing settlement not only freed the hostages but also put virtually all U.S. lenders and claimants against Iran in a much more favorable position than they had been prior to the seizure of the hostages.”
Case 82-3: South Africa versus Lesotho
In this case, Pape is correct that Lesotho was highly vulnerable to either economic or military pressure by South Africa. The evidence indicating that economic pressure was applied and had a substantial impact in Lesotho, however, is clear. Military intervention was much less direct. South Africa denied responsibility for the commando raids against African National Congress targets in Lesotho and is not known to have had a direct role in the coup that overthrew Chief Leabua Jonathan. Under these circumstances it seems legitimate to attribute a significant role in the outcome to the impact of economic sanctions.