Unleashing the Economic Arsenal

The US uses an increasingly intricate array of measures against its biggest global rivals

The US has the world’s strongest military and some of its most potent high-tech weapons, including stealth aircraft and precision rockets, but it’s leaning more and more on targeted economic measures to achieve strategic goals. And the nation is no longer limiting its targets to relative minnows such as Cuba, Iran, North Korea, and Venezuela.

“Most of the countries that were being targeted by US sanctions were almost by definition not really huge participants in the global economy,” says Daniel Drezner, a professor of international politics at Tufts University. “That has clearly shifted somewhat.”

The Biden administration responded to Russian President Vladimir Putin’s invasion of Ukraine not only by channeling arms and further aid to Kyiv but also by corralling allies to impose sanctions on Russia’s government. It also used the US’s position at the heart of global finance to cut off Russia from key capital markets and transaction networks such as the SWIFT payments system.

Against China the US is exerting pressure on multiple fronts at a time when tensions over Taiwan are ratcheting up. This month’s announcement of new restrictions on China’s access to semiconductor technology was the latest in a series of moves aimed at the world’s second-largest economy. The US has also revamped laws to make it harder to do business with some foreign-based companies, threatened to push Chinese firms off stock exchanges because of disclosure and accounting concerns, and kept companies such as TikTok parent ByteDance Ltd. mired in reviews.