No sanctions without globalization
The war in Ukraine has led some pundits to declare the end of globalization. We heard that after 9/11, after the Great Recession, after the US/China trade war, and again after Covid, and none of those predictions have panned out. Ukraine will likely be no different, as the threat of war actually makes the argument for globalization stronger.
There are two valid arguments for sanctions. First, denying money and material to an enemy nation can reduce their ability to wage war. Second, the threat of sanctions makes countries less likely to “go rogue”.
In general, I am rather skeptical of the efficacy of sanctions. I believe they are used far too often. And yet even I would not have favored allowing US firms to sell steel and oil to Germany and Japan during WWII. I don’t have strong views on what sanctions are appropriate for Russia today, except that the case for sanctions against Russia is stronger than for almost any other situation since WWII.
But sanctions only work when there is globalization. If a country is an autarky, i.e., relying solely on domestic production, then sanctions are ineffective.
People say, “Obviously globalization doesn’t work, as we still have bad things happen in the world.” Yes, the advantages of globalization have been oversold. (Recall the McDonald’s test.) But what is the counterfactual? Suppose we end globalization and each country becomes as autarkic as North Korea. Does that make the world more peaceful or more violent?
Our best hope for world peace is to enmesh every country so deeply in a web of interdependence with its neighbors that even our dimwitted leaders will be able to see the negative sum nature of war. Globalization may not prevent war, but it makes war less likely at the margin. And if war does break out, economic interdependence gives us a weapon to use in place of violence.
Globalization also makes the world a richer place. Economic development doesn’t guarantee peace, but greater wealth does make countries more peaceful, on average. They have more to lose from war.