The Journal of Commerce, Guest Opinion
By James E. Perrella
The wrong choice of weapons
When the United States imposed its grain embargo on the Soviet Union in 1980, farmers in Canada, France and Australia cheered as they inherited a formerly robust U.S. export market. The same U.S. sanctions forced many American farmers to line up in bankruptcy courts, victims of a foreign policy decision from which many would never recover.
The infamous grain embargo was imposed to force the Soviets to withdraw from Afghanistan. It didn't work. Instead, it turned into a symbolic gesture costing the U.S. farmers $2.3 billion in lost export sales.
Unfortunately, Washington did not learn from this experience, and the list of unilateral U.S. sanctions is growing at an alarming rate. And, as the list of sanctions imposed by the U.S. government grows, so does the reputation of America as an unreliable supplier.
Unilateral sanctions imposed by the United States on countries throughout the world have led to a patchwork of trade regulations with far-reaching economic effects. But as a tool of U.S. foreign policy, the sanctions are ineffective, counterproductive, and harmful to Americans.
U.S. sanctions are being meted out for any number of reasons. America's business community and its workers, deferring to the government's foreign policy priorities, have usually remained silent. However, it's time to speak up about the disastrous economic consequences that the government's practice of using unilateral sanctions as a universal remedy for all international ills could have. It's time to speak out about the lost opportunities, the lost wages and the lost jobs that Americans are suffering as a result of our misguided foreign policy initiatives.
A recent study by the Institute for International Economics concludes that U.S. exports to 26 target countries were reduced by $15 billion to $20 billion in 1995 as a result of economic sanctions implemented by the United States Government. U.S. jobs losses in the export sector during this period were estimated at 200,000 to 250,000.
Unilateral sanctions threaten our future by ceding America's fastest-growing export markets to our foreign competitors and by damaging the reputation of U.S. manufacturers and farmers as reliable suppliers.
When the government takes U.S. business and agriculture out of a market, it provides foreign suppliers a huge unearned advantage. While workers pay the price, the United States gets virtually nothing in return. In fact, sanctions take away the country's best tools for advancing human rights and democracy -- U.S. political and economic engagement.
American values are best advanced by engagement of American business and agriculture in helping to train workers, build infrastructure and promote free enterprise. Unilateral economic sanctions cut off that route.
Over the past four years, according to a recent study, the United States has imposed 61 separate unilateral sanctions on 35 countries. These countries account for about 40% of the world's population and about 20% of the potential export markets for American goods, services, and farm commodities.
Is there ever a case when the U.S. business community would support the use of economic sanctions? Yes, perhaps. But let's agree that the use of sanctions should be part of a multinational effort. If the United States decides on its own to try to influence change in a given nation by cutting off trade, America's biggest competitors from France, Germany, Japan or any other nations will try to fill the void at the expense of U.S. supplier and U.S. jobs.
Multilateral sanctions, on the other hand, have not only a better chance of succeeding, they are much less likely to provide unfair business opportunities to competitor nations.
When the United States stands tall on the world stage, Americans are proud. And rightfully so. We are the last superpower, and the world looks to us to lead -- but let's stop punishing ourselves. We have too many diplomatic tools at our disposal to depend on the use of ineffective and counterproductive economic sanctions.
The engagement of Americans in economic activity abroad -- businesses and farmers exporting, investing, purchasing -- is a powerful tool to promote freedom and peace throughout the world. Engagement will also keep us strong at home.
James E. Perrella is chairman, president and chief executive officer of Ingersoll-Rand Co. He also serves as chairman of the National Foreign Trade Council, which has established USA-Engage, a coalition of 500 companies and business groups concerned about trade sanctions.
Home |
About Us |
Resources |
Press Releases |
Federal Activity & Legislation
Return to Top
State & Local Activity |
NFTC Lawsuit |
Contact Us |
Site Index