The crisis in Venezuela continues to deepen, as Venezuelan opposition leader, Juan Guaido, announced this last week that the attempt to toppe embattled President Nicolas Maduro’s has entered its “final phase” of trying to get enough of the military to defect. In this reviewed article, which is actually the transcript of an interview with Democracy Now! , Jeffrey Sachs, a leading economist and director of the Center for Sustainable Development at Columbia University, argues that the policies of the United States are largely to blame for the humanitarian catastrophe in Venezuela. Specifically, his claim is that more than 400,000 people have died in the country since 2017 as a result of US sanctions. They (American sanctions) are “deliberately aiming to wreck Venezuela’s economy and thereby lead to regime change. It’s a fruitless, heartless, illegal, and failed policy, causing grave harm to the Venezuelan people.” Sachs’ claim runs contrary to the common narrative, which is held by the President and most members of Congress, and that is that Maduro’s policies are what brought the country to an economic standstill, not external factors. Throughout his presidency, the Trump Administration has taken a very hardline approach to Maduro, repeatedly saying that it wants him out and that “all options” are on the table. In this globalization block of IPE, we discussed a key tool of US foreign policy: financial and economic sanctions. The power of these sanctions depends largely on the dollar’s status as the global reserve currency and preferred means of exchange for international commerce. They are, fundamentally, coercive threats, designed to alter the cost-benefit calculation of a target state that in turn will alter its policy preferences. However, for them to work—that is, persuade a target to change its behavior—they must be aimed at behavior that the target state can, however reluctantly, change. Moreover, credibility plays a role, as the target state must reasonably believe that if it abandons its previous behaviors and/or policies, sanctions will indeed be lifted. Sachs is putting his finger on the central controversy surrounding sanctions: to whom shall feel the pain of the sanctions, be it the regime or society? According to Sachs, American sanctions towards Venezuela are affecting the latter. The logic behind the sanctions is that if they create enough pain, enough mass chaos, there will be a military overthrow. In Sachs’ words, the US is using its political power to “break other countries,” and the results are devastating. Perhaps, the Administration’s objective of regime change is quixotic. It instead is simply exacerbating an already terrible economic crisis, plunging economic activity and causing inflation and unemployment to grow. Sachs could very well have a point that Trump is doing more to hurt the people than the Maduro regime. Is this another case in which the United States may be abusing its financial might? Article found at: https://www.democracynow.org/2019/5/1/economist_jeffrey_sachs_us_sanctions_have .
