Despite Powell pleas, U.S. unlikely to ease sanctions

THE BALTIMORE SUN

WASHINGTON -- The number, breadth and complexity of U.S. economic sanctions against other nations so dismayed Colin L. Powell early this year that the soon-to-be secretary of state took the first chance he had to complain about them to Congress.

"They just keep coming. I think I've seen a half a dozen new ones ... in the last couple of weeks," Powell told the Senate Foreign Relations Committee at his confirmation hearing in January.

"Stop, look and listen before you impose a sanction," he implored. "Please stop. Count to 10. Call me."

Heeding Powell's cry, Congress has stopped and listened to the State Department's views on whether to renew the Iran-Libya Sanctions Act, which penalizes foreign companies investing in those nations and expires in August.

But the consultation hasn't had much apparent effect.

Congress moved Wednesday to renew the sanctions, and even Powell predicts that the effort will succeed. The expected renewal of the Iran-Libya measure, criticized by many as ineffective and counterproductive, casts doubt on Powell's larger agenda of trying to overhaul a broad array of more than 100 U.S. sanctions directed at dozens of countries.

"I'm sure Powell is genuinely committed to the idea of sanctions reform, but I think he's probably not going to have a whole lot of luck," said Kimberly Elliott, a trade analyst at the Institute for International Economics who sits on a State Department sanctions advisory committee. "These things are impossible to kill."

Economic sanctions are appealing because they enable nations to respond to foreign provocation without going to war.

Sanctions were used as long ago as the fifth century B.C. in Greece, when Pericles banned Megarian products from the Athenian market in retaliation for the abduction of three women.

Current U.S. sanctions include sweeping embargoes on Cuba, Iraq, Libya, Iran and North Korea as well as dozens of lesser measures against other states.

Three years ago, the U.S. International Trade Commission counted 29 nations subject to one or more of 142 U.S. sanctions, measures that levied penalties for behavior ranging from nuclear testing to the importation of environmentally unfriendly tuna.

Sanctions can restrict U.S. imports, exports, foreign investment, trade loans, military contacts, foreign aid or other commerce. Some sanctions are imposed by the president; many are mandated by Congress. They can be triggered by a nation's drug policies; development of nuclear, chemical or biological weapons; coups; human rights practices; promotion of terrorism; or other acts.

A 1998 law withholds portions of U.S. foreign assistance from nations whose diplomats are cited as parking scofflaws in Washington.

Recent political developments had produced what opponents thought was their best chance in years to trim Washington's sanctions list, especially the unilateral penalties that are particularly resented by big business and U.S. allies in Europe and Asia.

While U.S. corporations seeking to expand overseas markets have continued to lobby against sanctions, tight oil supplies and high gasoline prices have given sanctions opponents new reasons to argue for reopening Iran and Libya as U.S. sources of crude. So, too, have recent signs of political moderation in Libya and Iran.

The Bush administration has sanctions opponents in many senior positions.

As chief executive of Halliburton Co., a supplier of oil services worldwide, Dick Cheney called Washington "sanctions happy" in 1998 and argued for lifting the restrictions against Iran. A recent review by an energy task force headed by Vice President Cheney says policymakers should weigh the impact of sanctions on U.S. energy supplies.

President Bush has extensive ties to the oil industry, which has long chafed at sanctions. Powell seems to object to sanctions for bureaucratic reasons as much as anything, saying that implementation of the measures wastes huge amounts of U.S. officials' time.

"Almost every day, I'm either certifying, sanctioning or waiving somebody or something over something," Powell said.

The State Department will soon launch an ambitious, governmentwide review of sanctions with an eye toward streamlining the scores of measures. According to department officials, the review will be led by Richard Haass, Powell's policy planning director and another sanctions skeptic.

"Unilateral sanctions are rarely effective," Haass wrote in the 1998 book "Economic Sanctions and American Diplomacy."

"In a global economy, unilateral sanctions tend to impose greater costs on American firms than on the target," Haass wrote.

Haass favors multilateral sanctions and says that even those should be weighed with the gravity with which a nation considers going to war.

Critics say sanctions have gotten out of control, often don't work, anger U.S. allies, damage the U.S. economy and frequently hurt the people in targeted nations rather than the government.

European and Asian companies have signed lucrative deals in Libya, Iran and Cuba in recent years -- skirting American laws designed to block such deals -- while U.S. corporations have been shut out. Opponents of sanctions say that commercial interaction with free societies -- not sanctions -- is the best way to undermine the likes of Cuba's Fidel Castro and Libya's Muammar el Kadafi.

Many of the complaints against sanctions are directed at unilateral U.S. measures, in which Washington imposes economic restrictions on other nations without regard for what its allies are doing.

"If we could get one thing out of this [sanctions review], it would be to do sanctions multilaterally," said Frank Vargo, international vice president for the National Association of Manufacturers. "If an international situation is that egregious, and you're the State Department, then use your diplomacy to get the Europeans and the Japanese to go along with us."

However, supporters say sanctions are an important tool in molding international behavior and are not as numerous or tortuous as Powell and other critics contend. One example they often point to is the international economic pressure that helped induce South Africa to abandon apartheid.

"They're only one tool in the arsenal. They're not always totally effective, and sometimes they're only moderately effective," said Rep. Howard L. Berman, a California Democrat who co-sponsored the measure to renew sanctions against Iran and Libya. "But the benefits of sanctions have been underrated by a lot of people."

By threatening penalties against foreign companies that do business with Tehran, the Iran-Libya law, for example, "has been effective in slowing down investment in Iran," said Rep. Benjamin A. Gilman, a New York Republican and former chairman of the House International Relations Committee. "It has helped to slow Iran's development of the means to threaten the United States and its friends."

In spite of the Bush administration review and the momentum against sanctions, many say that even the unilateral laws aimed at hurting another nation's economy are too popular in Congress to be disposed of easily.

"It's a tough sell," said Vargo, who says the odds of a substantial easing of U.S. sanctions policy are about 50-50.

Events have made it difficult to ease U.S. sanctions, including unrest in the Middle East that has hardened the pro-Israel lobby's resolve to maintain sanctions against Israel's enemies; suspicions that Iran was behind the Khobar Towers bombing in Saudi Arabia, which killed 19 U.S. servicemen in 1996; and Libya's failure to pay compensation for its alleged role in the deadly bombing of Pan Am Flight 103 in 1988.

Bowing to reality in Congress, where bills that would renew the Iran-Libya sanctions have attracted nearly 200 co-sponsors in the House and about 60 in the Senate, the State Department has recommended that the White House support extending the sanctions for two years, a U.S. official said.

"The administration has learned that this is a much harder question to solve when you're on the inside rather than when you're on the outside," said David Goldwyn, a senior Energy Department official in the Clinton administration who helped administer sanctions against oil-producing nations such as Libya, Iran and Iraq.

"The hard reality is that when a major diplomatic event happens, and the administration has to react, and military intervention is out ... sanctions come back into the process."

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