Abstract
The conflation of UN sanctions, unilateral sanctions, and tools of national economic warfare is an unfortunate but perhaps inevitable side effect of the versatility of these mechanisms and their potential for abuse. These composites both strengthen but also weaken the integrity of the UN sanction system. They are the latest iteration of centuries of experiments with coercive policies, embargoes in support of national, international, or religious coalitions’ objectives; and the United States’ unilateral economic warfare system is its most direct progenitor. Clumsily applied first by the rebels in their fight for independence, sanctions were refined and tested during the American Civil War until during WW1 the rather obscure law, the Trading with the Enemy Act (TWEA) was created and effectively applied against the US’s WW1 enemies. During the preparations for WW2, when President Franklin D. Roosevelt needed an invisible form of warfare against Imperial Japan , the Act became the vehicle for blocking commodities. This period was also the genesis of the Office of Foreign Funds Control (FFC) within the US Treasury that delivered the tools for blocking the assets of individuals and companies, the forerunners of the UN ’s targeted sanctions. The US’s aggressive application of the commodity boycott against Japan also serves as the modern day example of how sanctions, when misused, can lead straight to war.
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Notes
- 1.
British taxation of its American colonies and duties imposed on exports escalated throughout the Colonial period. In 1764 the Sugar Act imposed sugar levies, in 1765 the Stamp Act forced payment for stamping a large number of documents and printed materials, and in 1767 the Townsend Act helped to raise revenues with duties on tea, paper, glass, and many other imports. After protests to all of these revenue schemes, the British announced in 1772 that tea imports—America ’s latest fashion and most popular non-alcoholic beverage—would be taxed.
- 2.
On December 1, 1774, the Continental Association was created by the First Continental Congress to implement a boycott on all British goods.
- 3.
President Franklin D. Roosevelt immediately invoked the TWEA to justify a five-day banking holiday as an emergency measure to forestall a catastrophic run on the national banking system. He took advantage of paragraph 5(b) of the Act that gave the Secretary of Treasury licensing power “for other purposes.” When the true intent of the Act was the restriction of transactions with foreign parties who could contribute to a national emergency, Roosevelt interpreted “other purposes” liberally to confront his immediate national crisis.
- 4.
Many authors cite this statement to Roosevelt , made in the summer of 1941, to British Prime Minister Winston Churchill during their secret meeting on board the USS Augusta. See, for example, Doris Kearns Goodwin; No Ordinary Time—Franklin and Eleanor Roosevelt : The home front in World War II; Simon and Schuster1995; pp. 265.
- 5.
The first executive order was issued subsequent to Germany ’s attack on Norway and Denmark in order to block assets located in these two countries. Roosevelt issues subsequent EO as Germany occupied other countries.
- 6.
The New York Times predicted, for example, on 25 July 1941 in a short article titled “America and Japan ” that with the arrival of Japanese warships off the coast of Indo-China , the end of the American policy of the “moral embargo” was near. The article concluded that “We shall also put an end to the self-defeating policy of aiding two belligerents in Asia simultaneously and throw our full weight, at last, on China’s side, where it belongs.”
- 7.
As recorded by the US State Department in Dept. of State Bulletin, Vol. V, No. 129, Dec. 13, 1941.
- 8.
Many studies have been published on the mechanics of the US’s enemy assets blockade. Even more titles have been published during the 1990s in response to renewed interest regarding the mishandling of Holocaust assets. See, for example, William Z. Slany; US and allied efforts to recover and restore gold and other assets stolen or hidden by Germany during world war II; Diane Publishing Company, 1997.
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Carisch, E., Rickard-Martin, L., Meister, S.R. (2017). An American Interlude: Sanctions Reinvented. In: The Evolution of UN Sanctions. Springer, Cham. https://doi.org/10.1007/978-3-319-60005-5_1
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