I have supported economic sanctions on Russia after the Ukraine invasion. Thus I clearly believe that they have at least some impact. But there’s a lot of evidence that sanctions aren’t actually very powerful. Russia’s economy has done pretty well despite last year’s enactment of what most pundits regarded as extremely severe sanctions.
A recent issue of The Economist provides two more examples of the relatively weak impact of sanctions. Here’s the title of an article discussing the impact of China’s sanctions on Australia:
Australia has faced down China’s trade bans and emerged stronger
The “lucky country” may be uniquely able to endure Chinese bullying
Uniquely able? Really? The US couldn’t survive Chinese trade sanctions? And what about all of the other countries that China has tried to pressure?
In the same issue, they provide a second example of this sort of “unique” outcome:
Europe has shaken off Putin’s gas embargo
Now it needs to think about how to deal with China
Some have argued that Europe “got lucky”. In fact, just the opposite is true. They got very unlucky:
Far from falling into an abyss, Europe’s largest economy suffered only the mildest of technical recessions. Some have put this down to luck, notably a mild winter in much of Europe reducing the demand for heating. In fact, the economists find, the weather was in line with recent years. If anything, other factors compounded the effect of missing Russian gas. French nuclear plants turned out to need unexpected maintenance at the worst possible time, for example.
The gas cutoff also occurred just after Germany had closed down some nuclear power plants. During a normal year, the Russian sanctions would have been even less effective.
So we have three recent examples where almost all of the so-called “geopolitical experts” badly misjudged the impact of sanctions. The devastating impact predicted for Russia and Europe, and to a lesser extent Australia, turned out to be wildly overstated.
Now many geopolitical experts say the US needs to be prepared to go to war with China—an outcome that might accidentally lead to a catastrophic nuclear war—because our economy would be devastated without the supply of computer chips from Taiwan.
Sorry guys, you’ve cried wolf too many times. Yes, by all means support Taiwan with military aid. But just as in Ukraine, a direct war between two nuclear-armed superpowers would be madness.
