Sanctions against Iran: Ignoring history.

As many around the world contemplate the use of increased economic sanctions against an increasingly-belligerent Iran, we might want to pause and ask whether such sanctions have proven effective in the past.

I ask this question in part driven by a fascinating seminar I attended last week at the Waterloo-based Centre for International Governance Innovation entitled “Why do leaders fail to learn from history?”, led by Balsillie School scholars David Welch, Robert Patnam, Janet Lang and James Blight.

The talk itself was focused on the lessons from war, in particular how American involvement in Vietnam, Afghanistan in the 1980s and the Gulf War could, and perhaps should, have imparted greater lessons for the more recent forays into Iraq and Afghanistan, yet didn’t because of an innate belief in exceptionalism amongst powerful US foreign policy makers.

Whether correct or not, I believe that same concept of exceptionalism applies to the issue of sanctions and the ignorance of nearly all empirical evidence related to their use.

South Africa, Cuba, Burma and Iraq (amongst others) have each been subject to economic and trade related sanctions over the past three decades. Yet in all but the first case, the ruling government in those nations has long survived those issuing the sanctions. Research by Robert Pape, then at Dartmouth College, showed that only 5 per cent of sanctions applied internationally could be proven successful at leading to a desired policy change.

In Cuba, economic sanctions placed on the island in 1962 by the United States, in response to the nationalization of US assets, have seen Fidel and now his brother Raoul outlast ten US presidents. The cost to Cuba has been immense, calculate by some at upwards of $100bn over the course of its near fifty year existence in lost trade and economic growth. The costs to US exporters, however, has been even greater – at some $4 to $5 billion a year in lost revenues. And while the citizens of both countries lose, the ultimate goal of this US policy remains unlikely to be achieved. If anything, the embargo has served Castro’s interests more than it has the US – allowing him to build an image of himself as defending Cuba’s rights against US imperialism, and providing sufficient social services to have people believe him.

In Burma/Myanmar and Iraq the stories are much the same. Ten years of sanctions against the Burmese military leadership have proven completely ineffective, and will continue to be so, so long as China continues to be that country’s complicit trade partner. In Iraq, UN sanctions against Saddam Hussein and his Iraqi leadership led to the deaths of between 100,000 and 500,000 children depending on the methodology, and did little to weaken his regime. Instead, Hussein used the sanctions to portray himself as fighting US imperialism.

In the one possible success story, Apartheid South Africa, an international disinvestment campaign accompanied by economic sanctions are often painted as the cause behind the fall of P.W. Botha’s Apartheid government.

Yet a closer look shows the regime’s demise predated the imposition of sanctions, and was a result of the accumulation of labour market pressure and discord caused by the increasing demand for black workers juxtaposed with the increasing repression of those workers. That system was increasingly untenable, and from 1976 forward, it was simply a question of time before labour unrest was felt more broadly in the economy.

That happened in the early 1980’s as international investors began divesting themselves of their South African assets and lending, not because of sanctions, but rather because of the fundamentals of the economy.

Thus, the sanctions that came in 1985 didn’t cause the downfall of the government – they placed what some, such as Philip Levy former Yale University professor and now resident scholar at the American Enterprise Institute, an additional challenge to the regime’s ability to forestall talks with the ANC. Levy notes, however, that equally if not more important was the departure of Cuban troops from Angola and the Soviet Union’s decision to withdraw from proxy wars – a decision that freed the Apartheid government to hold more open talks with the Communist-funded ANC.

Thus while sanctions did indeed serve to help push Botha and the Apartheid system out of South Africa, they did so by building on top of an endogenous desire for change. That desire for change is what has not been present in sufficient strength in Cuba, Burma and Iraq.

So let’s turn to Iran, Saddam Hussein’s one-time nemesis in the Gulf, and now the world’s greatest pariah-state thanks to its nuclear ambitions. While the US and EU continue to push for increasingly severe sanctions against the Ahmadinejad government in Tehran, efforts that have been tempered by Russian and Chinese reluctance to do so, history tells us that such sanctions may not be the key to change in Iran.

Sanctions that harm Iran’s oil production and oil exports, and subsequently place undo pressure on the Iranian economy, may in fact lead to a replication of Cuba or Iraq’s experience with sanctions – whereby external efforts to disable a government are coopted by that very government to show how they are being used by external forces in the name of US/EU/Western imperialism.

No matter the Iranian populations agreement with Ahmadinejad’s nuclear ambitions, or views on Israel, most will side against foreign interference in their internal affairs. The lessons from Cuba and Iraq should resound loudly in the heads of policy makers in Washington and Brussels.

Instead, they should look closely at the parallels between Iran today and South Africa in the early 1980’s. The latter case saw sanctions as but one of three key elements in bringing about change. First, increasing discontent amongst black labourers erupted into massive labour unrest which had a significant deleterious effect on the country’s credit and eventually the fundamentals of the South African economy. Second, the bankruptcy of the USSR and the withdrawal of Cuban and Soviet influence in the region made negotiations with the opposition ANC more palatable. And third, the decision by its biggest supporter, the USA, to support sanctions, left it truly without friends.

In Iran, the labour equivalent may be the country’s burgeoning demographic of young citizens. Over 60 per cent of the country’s 66 million citizens are under 30 years of age. They’ve already taken to the streets in protests numbering well into the millions, placing the ruling regime on their heels as they face their first challenge since the Revolution in 1979.

However, unlike South Africa in the 1980s, Iran’s ruling Ayatollahs will be very unlikely to support talks with the opposition that would undermine their rule. Talks regarding Iran’s future are not limited to conversations about who rules the country – rather they must also negotiate how Iran will be ruled, and ultimately the role of the Ayatollahs and religion in the state. The relatively even split of reformers and government supporters thus leaves little room for a South African styled demographic revolution.

Finally, while South Africa was left alone on its island of Apartheid, Iran benefits from continued support from its neighbours in the Middle East, notably Syria and Turkey. Moreover, while 30 per cent of the country’s exports flow to the EU, China’s increasing relations with Iran may serve to replace that market; so too could the Developing 8 trade group of Muslim nations.

Ultimately, Iran is far from the helpless position the South African Apartheid government was in the mid-to-late 1980s.  And thus while we abhor Iran’s stated or rumoured intentions vis-à-vis Israel, and its crackdown on rights and freedoms, exceptional sanctions against trade and economic activity may simply act to strengthen the resolve of the Ahmedinejad government in Tehran.

So what alternatives does the world have in its dealing with Iran?

Perhaps instead of solely using the stick, we might attempt employing the carrot, and attempt to increase trade and cultural ties with Iran. Doing so would build and diversify the Iranian economy, built cross-cultural ties for young Iranians, and may in the process build space for reformists. This represents a long-term engagement and evolution – one that unfortunately isn’t likely to make a fast enough impact to satisfy those in Washington, Tel Aviv and Brussels.

But if sanctions won’t actually work, and if a long-term engagement isn’t likely, then what’s left to do given the country’s nuclear ambitions and uncertain regional aims?


One Comment on “Sanctions against Iran: Ignoring history.”

  1. Peter Griffiths says:

    Well argued stuff as usual Dan.

    Sanctions are not all about policy/regime change though are they? They diminish the power and potential of the country against who the sanctions are levied and ensure that it’s kept in check.

    Cuba, Iraq, South Africa, Burma, North Korea may dissent on the periphery but without the the ability to trade, generate wealth and grow they cannot challenge the hegemon and remain relatively powerless. Other countries contemplating stepping out of line are warned off from doing so by what’s happened to the country who’s experienced the sanctions.

    With Iran I doubt the US does much trade so it’s corporates won’t lose a lot from sanctions and then from Iraq’s perspective I would expect the sanctions are actually a good thing as they place more of a premium on its exports and it closer to the US.

    With Cuba, obviously the US lost a lot of its business interests when the sanctions were levied, but what might have happened in the rest of Central America if they hadn’t done this? Arguably the way the US handled Cuba may have been critical in discouraging Nicaraugau, Hondura, Mexico or where ever from fully walking out of engagement with the US and into the a pact with Cuba and the Soviets.

    With China the US has chosen to engage, doing so has more than likely sowed the seeds for the US surrendering its position as the global hegemon.

    A bit of realism there for you!

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