“Although the United States has the power to seriously disrupt economic life in other countries, the book argues, the consequences don’t always serve American interests. Sanctions hurt the prosperity and political standing of Iran’s pro-American middle class the most. They also make the government more paranoid and remove important incentives to play nice. Everyone seems worse off.
The U.S. has tried to wash its hands of the policy’s consequences for ordinary Iranians, blaming their poverty on domestic “corruption and economic mismanagement” rather than on sanctions. But the data are clear. The Iranian economy was booming from 1988, the end of the country’s war with Iraq, to 2011, the beginning of former President Barack Obama’s intensified sanctions campaign.
Obama’s innovation was secondary sanctions. As the flow of direct American-Iranian trade shrunk, the U.S. Treasury’s Office of Foreign Assets Control punished companies in other countries that dealt with Iran. The Iranian economy became more or less radioactive, as any bank in the world that handled Iranian money and any shipping company that handled Iranian oil risked the wrath of the U.S. government.
Then Obama made a deal, lifting the sanctions in 2015 in exchange for restrictions on Iran’s nuclear program. Trade resumed and foreign investment flowed back in—until Trump reimposed sanctions in 2018. (Despite Trump’s claims to the contrary, former President Joe Biden continued to enforce the same sanctions.) Iran has since come closer to building a nuclear bomb, and it has had more confrontations with the U.S. military.”