when sanctions worked

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When Sanctions WorkedAuthor(s): Judith MillerSource: Foreign Policy, No. 39 (Summer, 1980), pp. 118-129Published by: Washingtonpost.Newsweek Interactive, LLCStable URL: http://www.jstor.org/stable/1148415 .

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WHEN SANCTIONS WORKED by Judith Miller

Economic sanctions, once shunned by American foreign policy makers in all but the most serious of international confronta- tions, are suddenly in vogue. The U.S. government has chosen to vent its frustration and fury against Iran for holding U.S. hostages and the Soviet Union for invading Afghanistan by imposing corresponding de- grees of economic reprisals.

Administration officials initially conceded that the total trade embargo imposed against Tehran and the far more limited measures taken against Moscow were merely symbolic. In each case, officials agreed that the sanctions would not severely wound the targeted government unless U.S. allies adopted similar measures, and even then the damage inflicted would be over the long term and limited.

Much in recent history supports the popular assumption that while trade boycotts, embargoes, and other economic sanctions are legitimate alternatives to military action, they rarely work. The American blockade and trade boycott imposed on Cuba in the early 1960s, for example, deprived Cuban Premier Fidel Castro of goods from and trade with the United States but failed to destroy the communist revolution and may even have strengthened popular support for the regime. U.N. economic sanctions against Rhodesia proved unsuccessful and, instead, spurred development of a staggeringly self-sufficient indigenous economy.

Despite such examples, however, there is at least one little-noted case of U.S. economic reprisals that proved far more than symbolic. On October 10, 1978, President Carter signed into law a total trade ban-in effect, a declaration of economic war-against the

JUDITH MILLER is a member of the Washington bureau of the New York Times.

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ruthless, megalomaniacal government of Idi Amin Dada, self-appointed president for life of Uganda. Less than six months later, Amin's eight-year rule of mass murder, bru- tality, economic ruin, and diplomatic farce came to an end.

Few press accounts or official statements attributed Amin's downfall to the American trade boycott. The sanctions, as critics had

predicted, were a quixotic effort. Indeed, there is no evidence that the suspension of U.S. purchases of Ugandan coffee-Uganda's dominant cash crop-had any perceptible effect on that nation's economy.

Nevertheless, there is considerable evidence that while the coffee boycott failed, the American sanctions proved devastating to the Ugandan economy and that they helped set in motion the events that led to the fall of the regime. In that respect, the U.S. boycott can appropriately be called a success.

The Ugandan case provides little guidance as to how similar steps might ultimately affect other countries, including Iran and the So- viet Union. The targeted nations and the objectives of the boycotts are far too dissimilar for any meaningful comparison. But the events in Uganda raise broad questions about the efficacy and advisability of using such drastic means against other states whose policies the United States officially abhors.

Do embargoes like the one imposed against Amin isolate regimes? Under what circum- stances will U.S. allies support economic sanctions and take similar steps? How do such efforts affect relations with neighboring governments? Are boycotts perceived as being meaningful? Does the United States expose itself to accusations of selective morality by its willingness to impose economic reprisals against a small, powerless nation like Uganda and its unwillingness, or inability, to take similar steps against South Africa?

In some ways, the boycott against Uganda was without precedent. Unlike the sanctions against Rhodesia, the United States acted unilaterally, without U.N. or other international endorsement. Never before had Con-

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gress, over the staunch opposition of an administration, legislated mandatory economic sanctions against a nonbelligerent state to protest what the law called "the consistent pattern of gross violations of human rights."

Ingredients for Success

The boycott was to a large extent the work of Congress, and in particular of Con- gressman Donald J. Pease (D.-Ohio), who had never set foot in Africa but who spear- headed the year-long campaign. Pease openly acknowledged that it was a boycott designed not to reform Amin but to destroy him.

In fact, there was little initial support for Pease's trade war against Amin. State De-

partment officials argued that as a major trading power, the United States should oppose restraint of trade for political purposes. Although the U.S. government officially deplored massive violations of human rights in Uganda, U.S. long-term interest in an international economic system with minimal barriers would ultimately suffer from such action. A boycott against Uganda, the Wash- ington Post editorialized in November 1977, would set "a dangerous precedent for more of the same political manipulation of international trade in less egregious cases." It asserted that the world's richest trading power should not arbitrarily use its massive economic power unilaterally to force the government of a smaller and weaker state to alter its internal treatment of subjects.

Tactically, however, there was a more compelling objection. In February 1978 former Deputy Assistant Secretary of State for African Affairs William C. Harrop told the Subcommittee on Africa of the House Inter- national Relations Committee that without significant international participation or support a U.S. boycott against Uganda would fail.

Throughout his long campaign, Pease argued that a ban on trade with Uganda contained unique ingredients for success. Un- like South Africa, Uganda was extremely dependent on American markets for its al-

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most sole export, robusta, a form of green coffee used mainly in instant coffee products. Hence, the boycott was aimed at coffee, which in recent years provided more than four-fifths of the nation's exports. It was also the pri- mary source of the foreign exchange Amin used to purchase Soviet arms and to supply his army, police, and civil service with luxury goods. However, while the United States im-

ported more than 33 per cent of Uganda's total coffee exports in 1977, Ugandan coffee

represented only 6 per cent of U.S. imports. The boycott would scarcely cause a ripple in the U.S. coffee market, Pease predicted, but would deprive Amin of much revenue to purchase the loyalty of his staff and troops.

A survey by the Congressional Research Service (CRS) indicates that not only did U.S.

companies stop importing Ugandan coffee after the boycott took effect in October 1978, but that they began cutting off their imports as early as July. According to the CRS survey, the United States imported 3.9 million

pounds of coffee worth $5,942,646 from

Uganda in May 1978. In June imports rose

sharply to more than 5.2 million pounds, valued at $7.3 million. In July, however,

imports plunged to 884,400 pounds, total-

ing $1,103,084, and declined again in Au-

gust to 536,000 pounds, or about $725,000.

By September imports were negligible. Thus, when the boycott was officially imposed, the coffee trade with the United States, worth $246 million to Uganda in 1977, had ended.

While trade boycotts, embargoes, and other economic sanctions are legitimate alternatives to military action, they rarely work.

Two other factors worked in favor of the

embargo. First, according to the Department of Agriculture, the trade ban did not result in substantially higher coffee prices for the American consumer. However, the fact that world coffee prices plummeted, dropping from a peak composite price in April 1977 of $3.33 a pound to $1.31 by February

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1979, makes it almost impossible to evaluate accurately the real impact of the trade ban. Second, Ugandan coffee production had for several years been falling sharply, declining 40 per cent between 1973 and 1975 from 4.2 million 60 kilogram bags to 2.5 million bags.

It appears that smuggling, sagging production, and plummeting world prices did more to bankrupt Uganda than did the U.S. embargo. Department of Agriculture figures support this view. For despite the U.S. ban, Ugandan coffee exports were actually greater in fiscal 1978 than in the previous fiscal year. Specifically, between October 1977 and Sep- tember 1978, Uganda produced 2.2 million bags of coffee and exported 1.9 million. The next fiscal year, Uganda produced 2 million bags but managed to export 2.2 million. Thus, the State Department, which warned that a boycott by one nation, even the largest purchaser, would not be effective without international support, seems to have been vindicated by the coffee boycott.

A Bad Credit Risk

The trade boycott did, however, take a heavy economic toll on Uganda, largely through one anticipated shortage-spare parts-and one unanticipated effect-the drying up of Uganda's access to imported oil. Soon after the boycott was imposed, it became practically impossible to obtain spare parts for American manufactured products. This shortage affected a wide variety of sec- tors of the Ugandan economy, including road construction, agriculture, and services.

One of the most intriguing, potentially significant, and unpublicized effects of the boycott concerns IBM, whose computer system processed Uganda's entire government payroll. Sensing the congressional mood and concerned about its employees' well-being, IBM gradually disengaged from Uganda in early 1978. IBM's sole remaining employee in Uganda fled the country when the computer failed on December 4. "One thing seems certain: No army soldier or civil servant could have been paid on a mechanized payroll after

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December 4," an IBM spokesman in Wash- ington said.

Even more significant was the role played by American oil companies in Kenya who supplied Uganda from refineries in Mombasa. The suspension of petroleum shipments to Uganda in October 1978 had a severe impact on the Ugandan economy and ultimately limited Amin's military options to fight the Tanzanian invasion in late January 1979. The boycott, however, resulted from an ear- lier confrontation between Amin and the oil companies. According to State Department officials and reports in the British press, the three American companies-Caltex, Exxon, and Mobil-that supplied the Ugandan market with almost 40 per cent of its oil cut their shipments from Kenya in July 1978 after Amin had fallen six weeks behind in his payments. Amin met with their represen- tatives to beg them to renew his shipments. Without oil he could not transport coffee out of Uganda and acquire the foreign exchange needed to pay his previous bills.

Only after difficult negotiations did the

companies agree to begin supplying Uganda with 65 per cent of its previous import level. Hence, Uganda began to experience severe oil shortages by the fall, before the boycott was ever formalized. After it took effect, the companies immediately suspended all shipments of oil from outside the United States.

Uganda's oil shortage became severe in early January, shortly before Tanzania pre- pared to launch its invasion. One State De- partment officer credited the boycott with giving the oil companies a convenient excuse for the suspension of shipments: "The companies first used the House resolution, and later the boycott to limit their exposure to an obviously bad credit risk; in other words, it enabled them to do patriotically exactly what they wanted for economic reasons."

The oil shortage was an important factor in Amin's downfall. But sensitive about ad- vocating oil embargoes and concerned about the jurisdictional question, neither the House nor the Senate committees that considered

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the boycott legislation ever called an oil company spokesman to testify about what impact a petroleum suspension would have. "Of all the instruments of policy, an oil boycott was one we didn't want to fool around with," said one official.

In both House and Senate hearings, State Department officials correctly predicted that U.S. allies were not likely to join a U.S. boycott. In July 1978 David Owen, then British foreign minister, told Representative Stephen J. Solarz, chairman of the Subcommittee on Africa of the House International Relations Committee, that while Britain could not take the first step, his government would seriously consider imposing an embargo on Uganda if the United States did. Soon after the boycott became law, Solarz contacted Owen and re- minded him of their July discussion. Owen responded in a letter on December 18 that trade with Uganda was part of the European Com- munity's Common Commercial Policy and that Britain "could not therefore take action independently of [its] Community partners." There was, he added, "no sign of general support within the Community for the institu- tion of a trade embargo."

The British did, however, take some steps to limit formal and informal support for the Amin regime. Owen's letter noted that Shell Oil and British Petroleum, which supplied oil to Uganda, "were not making up any shortfall in the normal level of supplies to Uganda resulting from the suspension of deliveries by the U.S. companies."

In March 1979-shortly before Amin's fall-the British also finally suspended per- mission for the "whiskey runs," through which luxury goods for the Ugandan military were delivered. The CRS report concludes that the U.S. trade ban might have been a factor in the British decision "since the U.S. action strengthened the cause of British critics of their government's relations with the Amin regime." Moreover, Pease contends that had the boycott lasted, the British, Uganda's second largest coffee export market, would have ultimately joined the embargo: "The

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British were divided on the boycott question. In time, they would have come around."

Selective Morality

One of the most intriguing aspects of the boycott is the impact it had on Amin's attack on Tanzania in late October 1978 and on Tanzanian President Julius Nyerere's decision to counterattack three months later. Analysts are divided over the reasons for Uganda's military action against Tanzania. But several who were there at the time agree with an ex-

planation offered by the CRS study: Amin's attack, "which may have provoked the fatal Tanzanian counter-attack," was motivated by the embargo. "This possibility is plausi- ble," the study concludes, "because of the

timing of the attack." On October 12 "Amin first began to raise

the alarm about an alleged Tanzanian invasion of Uganda-an alleged invasion that was the prelude to the Ugandan attack at the end of the month," the report states. "This timing at least suggests that Amin may have provoked a crisis with Tanzania to demonstrate to his own people and to the world that he was still a strong and influen- tial leader, despite the action taken by the United States." This assessment is supported by Solarz, who has said that the boycott may have played a role in Amin's actions.

Similarly, there is considerable evidence confirming the conclusion of the CRS study that the embargo's imposition "might have been a factor in persuading Nyerere that the time was propitious for intervention in Uganda" and that it might have "encouraged the Ugandan exile opposition to unite and begin coordinating action against Amin."

This view is supported by Tanzanian government officials, including Paul Bomani, Tanzania's ambassador to the United States. "The U.S. boycott was a definite factor in our counterattack in that it helped make the world community aware of Uganda's human rights violations," he said. "We sensed that public opinion would not be violently op- posed to Tanzania's measures."

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Harrop, one of several administration spokesmen who had testified against the embargo, acknowledged recently that the trade ban "had far more psychological and political impact than we had anticipated." Similarly, Robert V. Keeley, former deputy assistant secretary for African affairs and now ambassador to Zimbabwe, said that while he be- lieved that the embargo was not in place long enough to have been a major economic factor in Amin's fall, "it certainly put the [United States] in a strong position in Uganda today, for it was perceived as being significant." This is echoed by former activists in the Ugandan exile community, many of whom now hold official positions in the troubled new government. "It confirmed President Nyerere's initial impression that the Carter administration was committed to a human rights policy," said Bomani.

Economic sanctions may well remain the most appropriate and least costly vehicle for expressing official outrage and opposition.

Another U.S. official concerned with Af- rican affairs suggests that the boycott also caused a political problem. The embargo, he argues, was seen by some nonaligned nations as yet another example of America's willingness to use its massive economic power against a small, noninfluential, nonstrategic black regime while refusing to take comparable action against South Africa. Pease and Solarz agree that the boycott made the U.S. government vulnerable to this charge. Both noted that many members of the congressional Black Caucus were initially critical of the boycott precisely for this reason, but ultimately supported it on the House floor.

Former Ambassador to the U.N. Andrew Young argues that the sanctions might have been viewed as an example of U.S. selective morality, or of a double standard had the administration failed to support U.N. sanctions against Rhodesia or the arms embargo

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against South Africa. "But we were willing to pursue economic reprisals in all of these situations," Young said.

In addition to the potential for under- mining the benefits gained from imposition of sanctions against Uganda if they are not used against South Africa, there is another danger inherent in the use of the economic weapon: The United States might be tempted to use sanctions more broadly and indiscriminately in the future.

A Paucity of Options

The Carter administration has recently re- lied on economic weapons against Iran and the Soviet Union to achieve specific foreign policy objectives. Analysts appear deeply divided over the impact of economic sanctions against Iran, but few believe that the punitive measures will by themselves bring an end to the hostage crisis. There seems to be a consensus that the sanctions are causing shortages in many basic commodities in Tehran and elsewhere but that it is increas- ingly difficult to detect any relationship between imposing economic hardship on Iran and the release of the hostages.

One Senate analyst argues that the sanctions are counterproductive, because they will drive Iran closer to the Soviet Union. Some State Department officials dispute this contention, arguing that while the Iranians might seek limited accommodations with the Soviets, fear of Soviet expansion would pre- vent a true rapprochement. Moreover, the Soviet system constitutes the antithesis of the goals of the Iranian revolution. The danger is that economic scarcity will reinforce Ira- nian paranoia and hostility toward the United States and strengthen the power of the ruling conservative clergy over the population.

The sanctions against Iran and in particular the Soviet Union have created significant strains on relations between the United States and its West European allies. The Bonn government fears, for example, that the possible escalation of the now limited sanctions into a full-fledged trade war with the Soviets would

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have dire consequences for the West German economy, where 100,000 jobs are related to the production of goods for the Soviet market, and 200,000 jobs are tied to purchases by other Council for Mutual Economic Assistance nations. The allies have tended to support U.S. sanctions thus far because they recognize the political significance of the measures. Most agree that the sanctions will not force the Soviets out of Afghanistan. But the administration hopes they will cause the USSR to think twice before engaging in similar action elsewhere.

Ironically, a senior State Department official said recently that the most effective sanction against the Soviet Union might not be the limitation on grain sales or the ban on the export of sophisticated technology, but rather the U.S. effort to boycott the Olympic games: "In Uganda, the sanctions were most effective in isolating Amin, in depriv- ing the regime of legitimacy. The Olympics for the Soviets are an important symbol of international legitimacy, and to deny them that will be disturbing and painful for them."

The sanctions against Iran and the Soviet Union serve another purpose: They provide an answer to questions about what the administration is doing to implement its policy objectives; and in this sense, especially in an election year, they are for domestic consump- tion. The reliance on economic sanctions also reflects a paucity of other effective options. Thus, for all of their shortcomings, economic sanctions may well remain the most appropriate and least costly vehicle for expressing official outrage and opposition.

South Africa may turn out to be the next test of the U.S. willingness to employ economic measures to achieve foreign policy objectives. However, State Department officials oppose any attempt to impose economic sanctions. They note that South Africa supported U.S. and British efforts to achieve a peaceful resolution to the Rhodesian civil war. Moreover, U.S. allies, especially the British, would actively resist such a move. Finally, there is a strategic consideration:

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Washington has a considerable stake in the survival of a noncommunist, cooperative government in that strategic corner of the globe.

In addition to these policy concerns, there is a political obstacle: Unlike Uganda, which had few supporters in the United States, vir- tually every congressional district has corpo- rations with economic ties to or interests in South Africa or political groups sympathetic to the regime.

Solarz, who last year sponsored legislation to prohibit all new investment in South Africa, argues that his proposal would ulti-

mately promote U.S. interests in Africa, even in South Africa. And unlike the Ugandan effort, he does not see his legislation as a means of devastating the South African

economy. Rather, he argues, its impact would be primarily symbolic. "It would be a signal to the indigenous majority within South Africa and to the rest of Africa that the [United States] is willing to begin to match its words against apartheid with deeds."

Similarly, Young is not willing to endorse a total boycott of South Africa at this time, arguing that it would not be effective and would probably encourage development of a more self-sufficient economy. "As long as there is some progress being made, or a dem- onstration of a willingness to move, a total

boycott is really not appropriate," he asserts. However, certain sanctions "might well isolate South Africa and have a profound psychological effect .... We learned in the civil rights movement that a boycott does not have to be 100 per cent total to be effective. In fact, selective boycotts are often more effective than total ones."

The State Department may have been right in cautioning against the establishment of such a precedent, even against Uganda. Hav- ing used a trade war in the name of human rights and having demonstrated a willingness to use economic reprisals as an alternative to military action against Iran and the Soviet Union, the Carter administration may well find itself in a thorny dilemma if it balks in the case of South Africa.

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when sanctions worked

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