Skip to main content Accessibility help
×
Home
Hostname: page-component-7ccbd9845f-vmftn Total loading time: 0.901 Render date: 2023-02-01T22:31:24.268Z Has data issue: true Feature Flags: { "useRatesEcommerce": false } hasContentIssue true

Sanctions at bay? Hegemonic decline, multinational corporations, and U.S. economic sanctions since the pipeline case

Published online by Cambridge University Press:  22 May 2009

Get access

Extract

One of the lessons drawn by many scholars from the 1982 U.S. sanctions against the Soviet-European gas pipeline was that the decline of American hegemony and the global spread of American business placed the overseas networks of U.S. multinational corporations beyond the control of the U.S. government for the purposes of economic sanctions. Through systematically examining three subsequent sanctions efforts (Nicaragua, Libya, and South Africa), this study qualifies the generalizability of this “lesson.” In none of the cases was the United States willing to incur alliance costs through applying extraterritorial controls, nor was it able to persuade American firms to substitute public preferences for private ones. Nonetheless, in each case, the U.S. government influenced corporate decision making by augmenting corporate perceptions of risk so that prudent business stategies reinforced diplomatic preferences.

Type
Articles
Copyright
Copyright © The IO Foundation 1995

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1. Nathan, James A. and Oliver, James K., Foreign Policy Making and the American Political System (Boston: Little, Brown, 1983), pp. 233–36.Google Scholar For further arguments that the growth of the MNC sets limits on the U.S. government's ability to wield economic instruments, see Vernon, Raymond, Storm over the Multinationals: The Real Issues (Cambridge, Mass.: Harvard University Press, 1977), pp. 104–6Google Scholar; Feinberg, Richard E., The Intemperate Zone: The Third World Challenge to U S. Foreign Policy (New York: Norton, 1983), pp. 17 and 3840Google Scholar; Doxey, Margaret P., International Sanctions in Contemporary Perspective (New York: St. Martin's, 1987), p. 89CrossRefGoogle Scholar; Hillebrand, Martin J., “East–West Economic Relations: Export Controls and Strains in the Alliance,” in Bertsch, Gary K., ed., Controlling East–West Trade and Technology Transfer: Power, Politics, and Policies (Durham, N.C.: Duke University Press, 1988), p. 379Google Scholar; and Morse, Duane D. and Powers, Joan S., “U.S. Export Controls and Foreign Enterprise: The Unanswered Questions of the Pipeline Dispute,” Virginia Journal of International Law 23 (Summer 1983), pp. 537–67.Google ScholarInternational Organization 49, 1, Winter 1995, pp. 105–37Google Scholar

2. The quotation is from Kapstein, Ethan B., The Political Economy of National Security: A Global Perspective (New York: McGraw-Hill, 1992), p. 176.Google Scholar On this same matter, also see Pollard, Robert A., Economic Security and the Origins of the Cold War, 1945–1950 (New York: Columbia University Press, 1985), p. 250.Google Scholar

3. See Keohane, Robert O., “The Theory of Hegemonic Stability and Changes in International Economic Regimes, 1967–1977,” in Holsti, Ole R., Siverson, Randolph M., and George, Alexander, eds., Change in the International System (Boulder, Colo.: Westview, 1980, pp. 131–62).Google Scholar For an application to economic sanctions, see Crawford, Beverly and Lenway, Stefanie, “Decision Modes and International Regime Change: Western Collaboration on East–West Trade,” World Politics 36 (04 1985), pp. 375402.CrossRefGoogle Scholar

4. See Ikenberry, G. John and Kupchan, Charles A., “Socialization and Hegemonic Power,” International Organization 44 (Summer 1990), pp. 283–315 and p. 285CrossRefGoogle Scholar in particular; and Haas, Ernst B., “Why Collaborate? Issue Linkage and International Regimes,” World Politics 33 (04 1980), pp. 357–405 and p. 372 in particular.Google Scholar

5. On the conflict between U.S. preferences for economic warfare and European preferences for strategic denial, see Mastanduno, Michael, Economic Containment: CoCom and the Politics of East-West Trade (Ithaca, N.Y.: Cornell University Press, 1992), pp. 4052.Google Scholar

6. Extraterritorial Subsidiary Jurisdiction,” Law and Contemporary Problems 50 (Summer 1987), pp. 71–93 and pp. 7273 in particular.Google Scholar

7. Carter, Barry E., International Economic Sanctions: Improving the Haphazard U.S. Legal Regime (Cambridge, England: Cambridge University Press, 1988), pp. 82–85 and 187–88.Google Scholar

8. “Extraterritorial Subsidiary Jurisdiction,” pp. 84–89.

9. Adler-Karlsson, Gunnar, Western Economic Warfare, 1947–1967: A Case Study in Foreign Economic Policy (Stockholm: Almqvist and Wiksell, 1968), pp. 4549.Google Scholar This view is challenged by Mastanduno, who argues that legislation linking aid to conformity with the U.S. embargo was designed more to appease Congress than to coerce allies. No administration ever invoked the legislation's provisions because of the high cost of such actions in terms of impeding European recovery and disrupting the Atlantic alliance. See Mastanduno, , Economic Containment, pp. 8589.Google Scholar

10. Stephen J. Kobrin, “Hegemony, American Multinationals, and the Extraterritorial Enforcement of Export Sanctions,” (Paper presented to the annual meeting of the American Political Science Association, Washington, D.C., 1–4 September 1988), pp. 29–30.

11. See Mastanduno, , Economic Containment, pp. 8293Google Scholar; and Jentleson, Bruce W., Pipeline Politics: The Complex Political Economy of East–West Energy Trade (Ithaca, N.Y.: Cornell University Press, 1986), pp. 117–23.Google Scholar

12. Kobrin, “Hegemony, American Multinationals, and the Extraterritorial Enforcement of Export Sanctions,” p. 30.

13. Ibid., pp. 9–13. Also see Berman, Harold J. and Garson, John R., “United States Export Controls: Past, Present, Future,” Columbia Law Review 67 (05 1967), pp. 791–890 and pp. 851–53CrossRefGoogle Scholar in particular; and Hodges, Jack W., “The Trading with the Enemy Act of 1917 and Foreign-Based Subsidiaries of American Multinational Firms: A Time of Abstain from Restraining,” San Diego Law Review 10 (11 1973), pp. 206–26 and p. 219Google Scholar in particular.

14. For documented examples, see Behrman, Jack N., National Interests and the Multinational Enterprise: Tensions Among North Atlantic Countries (Englewood Cliffs, N.J.: Prentice-Hall, 1970), pp. 104112Google Scholar; Berman and Garson, “United States Export Controls,” p. 870; and Hodges, “The Trading with the Enemy Act of 1917 and Foreign-Based Subsidiaries of American Multinational Firms,” p. 225.

15. For evidence of such corporate attitudes, see Perlmutter, Howard V., “The Tortuous Evolution of the Multinational Corporation,” Columbia Journal of World Business 4 (01-02 1969), pp. 918Google Scholar; Pollard, , Economic Security and the Origins of the Cold War, 1945–50, pp. 161–62Google Scholar; Wilkins, Mira, The Maturing of Multinational Enterprise (Cambridge, Mass.: Harvard University Press, 1974), pp. 287–91CrossRefGoogle Scholar; Adler-Karlsson, , Western Economic Warfare, 1947–1967, p. 34Google Scholar; and Jentleson, Bruce W., “From Consensus to Conflict: The Domestic Political Economy of East–West Energy Trade Policy,” International Organization 38 (Autumn 1984), pp. 625–60CrossRefGoogle Scholar and p. 636 in particular.

16. For specific cases, see Adler-Karlsson, , Western Economic Warfare, 1947–1967, pp. 106–8Google Scholar; and Gladwin, Thomas N. and Walter, Ingo N., Multinationals Under Fire: Lessons in the Management of Conflict (New York: Wiley, 1980), pp. 240–41.Google Scholar

17. Gilpin, Robert, U.S. Power and the Multinational Corporation: The Political Economy of Foreign Direct Investment (New York: Basic, 1975), p. 135.CrossRefGoogle Scholar

18. Cohen, Benjamin J., “Balance-of-Payments Financing: Evolution of a Regime,” International Organization 36 (Spring 1982), pp. 457478CrossRefGoogle Scholar and p. 471 in particular.

19. Kobrin, “Hegemony, American Multinationals, and the Extraterritorial Enforcement of Export Sanctions,” pp. 17–27 and 31–33.

20. U.S. Department of State, “U.S. Takes Steps to Conform with OAS Action on Cuba,” Department of State Bulletin, 15 09 1975, p. 404.Google Scholar

21. Ibid., pp. 83–85 and 253. Also see the discussions of the Nicaraguan and Libyan sanctions below. Mastanduno notes, however, that this relaxation of policy did not extend to controls on the re-export of U.S.-origin goods. See Mastanduno, , Economic Containment, p. 262.Google Scholar

22. Wells, Louis T. Jr, “The Multinational Business Enterprise: What Kind of International Organization?” in Keohane, Robert O. and Nye, Joseph S. Jr, eds., Transnational Relations and World Politics (Cambridge, Mass.: Harvard University Press, 1971), pp. 97114.Google Scholar The quotation is from p. 113. Also see Gilpin, , U.S. Power and the Multinational Corporation, pp. 242–45.Google Scholar

23. Turner, Louis, Oil Companies in the International System, 3d ed. (Winchester, Mass.: Allen and Unwin, 1983), pp. 226–30.Google Scholar Also see Gilpin, , U.S. Power and the Multinational Corporation, pp. 145–46.Google Scholar During the Arab oil embargo, however, the decision of the major companies to compensate the United States and other embargoed countries by spreading out the cutbacks according to the principle of “equal suffering” demonstrated that home state interests still weighed heavily in their calculations. See Stobaugh, Robert B., “The Oil Companies in Crisis,” in Vernon, Raymond, ed., The Oil Crisis (New York: W.W. Norton, 1976), pp. 179202Google Scholar and p. 188 in particular.

24. See, for example, U.S. Congress, House Committee on Affairs, Foreign, Extension and Revision of the Export Administration Act: Hearings Before the Committee on Foreign Affairs, 98th Congress, 1st secs., 1983, pp. 118–19.Google Scholar

25. Dresser Industries is quoted in Kobrin, “Hegemony, American Multinationals, and the Extraterritorial Enforcement of Export Sanctions,” p. 26.

26. See Barnet, Richard J. and Muller, Ronald E., Global Reach: The Power of the Multinational Corporations (New York: Touchstone, 1974), pp. 98102Google Scholar; Purcell, John F. H., “The Perceptions and Interests of United States Business in Relation to the Political Crisis in Central America,” in Feinberg, Richard E., ed., Central America: International Dimensions of the Crisis (New York: Holmes and Meier, 1982) pp. 103–23Google Scholar; Spindler, J. Andrew, The Politics of International Credit: Private Finance and Foreign Policy in Germany and Japan (Washington, D.C.: Brookings Institution, 1984), pp. 199201Google Scholar; and Feinberg, , The Intemperate Zone, p. 97.Google Scholar

27. Jentleson, , Pipeline Politics, pp. 47Google Scholar and 144–46; “irrefutability” is Jentleson's term.

28. Ibid., pp. 204–7.

29. Green, Nancy, “Congress Clears Bill to Renew Main Law Regulating Exports,” Congressional Quarterly Weekly Report, 29 06 1985, p. 1302–3.Google Scholar

30. Conroy, Michael, “The Political Economy of the 1990 Nicaraguan Election,” International Journal of Political Economy 20 (Fall 1990), pp. 4769.CrossRefGoogle Scholar

31. For contrasting views, see Colburn, Forrest D., “Nicaragua Under Siege,” Current History 84 (03 1985), pp. 105–8Google Scholar; and Weeks, John, “Economic Crisis in Nicaragua: Blaming the Victim,” Review of Radical Political Economics 20 (SummerFall 1988), pp. 266–70.CrossRefGoogle Scholar

32. For an overview, see Gary Hufbauer, Jeffrey Schott, and Kimberly Ann Elliot, Economic Sanctions Reconsidered, vol. 1, History and Current Policy, 2d ed. (Washington, D.C.: Institute of International Economics, 1990), pp. 175–81.Google Scholar

33. See Nicaragua Says it Will Repudiate Somoza Era Debt,” New York Times, 29 09 1979, p. 3Google Scholar; and an Riding, , “Nicaragua Debt Talks are Opened,” New York Times, 15 12 1979, p. 35.Google Scholar

34. See Weinert, Richard S., “Nicaragua's Debt Renegotiations,” Cambridge Journal of Economics 5 (06 1981), pp. 187–94CrossRefGoogle Scholar; and Dizard, John, “Why Bankers Fear the Nicaraguan Solution,” Institutional Investor 14 (11 1980), pp. 5463.Google Scholar

35. Telephone interview with a bank official involved in the negotiations, 6 July 1988; and personal interview with Richard Weinert of Leslie, Weinert, and Co., who advised the Nicaraguan government in the negotiations, 29 June 1988. Also see Dizard, “Why Bankers Fear the Nicaraguan Solution,” p. 60.

36. In Brief: Nicaragua/Debt, Latin America Weekly Report, 2 10 1981, p. 12.Google Scholar

37. The report is cited in Conroy, Michael E., “External Dependence, External Assistance, and Economic Aggression Against Nicaragua,” Latin American Perspectives 12 (Spring 1985), pp. 3967CrossRefGoogle Scholar and p. 51 in particular.

38. Telephone interview with bank official, 6 July 1988.

39. Castle and Cooke Unit and Nicaragua Agree on Banana Production,” Wall Street Journal, 13 01 1981, p. 16.Google Scholar

40. See Business International, Investing, Licensing, and Trading Conditions Abroad: The Central American Common Market (New York: Business International Corp., 05 1982)Google Scholar; and Survey Finds Most MNCs Receive Fair Treatment from Sandinistas,” Business Latin America, 12 08 1981, p. 249Google Scholar; and A Warmer Welcome for U.S. Businessmen,” Business Week, 10 01 1983, p. 43.Google Scholar

41. For reports of specific examples, see Bankers Reach Debt Accord,” This Week in Central America, 5 09 1980, p. 284Google Scholar; and Nicaragua: Business Rolling On,” Central America Report, 17 03 1980, p. 86.Google Scholar For a general argument regarding this shift in priorities, see Conroy, “External Dependence, External Assistance, and Economic Aggression Against Nicaragua,” p. 47.

42. Austin, James E. and Ickis, John C., “Management, Managers, and Revolution,” World Development 14 (07 1986), pp. 775–90CrossRefGoogle Scholar, and p. 783 in particular.

43. “Survey Finds Most MNCs Receive Fair Treatment from Sandinistas,” pp. 249–51.

44. Purcell, “The Perceptions and Interests of United States Business in Relation to the Political Crisis in Central America,” pp. 107 and 119.

45. See Economist Intelligence Unit, Quarterly Economic Review of Nicaragua, Costa Rica, and Panama (London: Economist Intelligence Unit, 24 01 1983), p. 14Google Scholar; Stahler-Sholk, Richard, “Foreign Debt and Economic Stabilization Policies in Revolutionary Nicaragua,” in Spalding, Rose, ed., The Political Economy of Revolutionary Nicaragua (Boston: Allen and Unwin, 1987), p. 159.Google Scholar

46. “A Warmer Welcome for U.S. Businessmen,” p. 43.

47. In Brief: Nicaragua/Debt, p. 12.

48. Coone, Tim, “No Miracles are to be Expected,” Financial Times, 20 03 1984, p. 4.Google Scholar

49. See summaries of Quainton to Secretary of State, “Nicaragua's Debts to Foreign Commercial Banks,” telegram 4720, 20 October 1982, p. 5. This document summarizes meetings between bank officials and the American Ambassador to Nicaragua and was obtained through the Freedom of Information Act.

50. Telephone interview with bank official, 6 July 1988.

51. Purcell, “The Perceptions and Interests of United States Business in Relation to the Political Crisis in Central America,” p. 121.

52. U.S. Congress, House Committee on Foreign Affairs, The Imposition of Economic Sanctions and a Trade Embargo Against Nicaragua: Hearings Before the Committee on Foreign Affairs. 99th Congress, 1st sess., 7 May 1985, p. 41.Google Scholar

53. Gilpin, Kenneth N., “Nicaragua Outlook Worries Executives,” New York Times, 15 08 1983, p. D1.Google Scholar

54. See Austin and Ickis, “Management, Managers, and Revolution,” pp. 784–85; and Austin, James E. and Ickis, John C., “Managing after the Revolutionaries Have Won,” Harvard Business Review 64 (0506 1986), pp. 103–9Google Scholar, and p. 108 in particular.

55. Austin and Ickis, “Managing after the Revolutionaries have Won,” p. 105; letter from Exxon Corporation, Latin American Division, 26 May 1988; and telephone interview with IBM Corporation official, Latin American Division, 27 June 1988.

56. Overseas Development Council, The U.S. Embargo Against Nicaragua: One Year Later, Policy Focus, no. 3 (Washington, D.C.: Overseas Development Council, 05 1986), p. 7.Google Scholar

57. Coone, Tim, “Nicaragua Eases into New Export Markets,” Financial Times, 8 05 1985, p. 4.Google Scholar

58. Ross, Oakland, “U.S. Blockade of Nicaragua Painful, Not Fatal,” Toronto Globe and Mail, 28 05 1985, pp. 12.Google Scholar

59. See What U.S. Companies Say About the Nicaraguan Embargo and What They're Doing,” Business Latin America, 22 05 1985, p. 167Google Scholar; Rogers, Michael, “Mixing Trade with Nicaragua,” Fortune, 27 05 1985, p. 8Google Scholar; and Krauss, Clifford, “Multinational Corporations Continue to be Crucial to Nicaraguan Economy,” Wall Street Journal, 14 11 1986, p. 34.Google Scholar

60. Nicaragua Gets Loan,” New York Times, 17 09 1982, p. D15.Google Scholar Also see Carter, , International Economic Sanctions, pp. 166–68.Google Scholar

61. Bank, World, World Debt Tables: External Debt of Developing Countries, 1987–88, vol. 2 (Washington, D.C.: World Bank, 1988), p. 266.Google Scholar

62. Kinzer, Stephen, “Nicaragua Says U.S. Blocks $58 Million Loan,” New York Times, 13 04 1986, p. 8.Google Scholar

63. Conroy, “The Political Economy of the 1990 Nicaraguan Election,” pp. 16–17.

64. See Conroy, “External Dependence, External Assistance, and Economic Aggression Against Nicaragua,” p. 55; and Gilpin, “Nicaragua Outlook Worries Executives,” p. D7.

65. McCartney, Robert J., “U.S. Will Oppose Loans to Nicaragua,” Washington Post, 1 07 1983, p. A3.Google Scholar

66. U.S. Department of Commerce, Foreign Economic Trends and Their Implications for the United States: Nicaragua (Washington, D.C.: Government Printing Office, 03 1986), p. 7.Google Scholar

67. Testimony of Langhorne Motley, Undersecretary for State of Inter-American Affairs, in U.S. Congress, Committee on Foreign Affairs, The Imposition of Economic Sanctions and a Trade Embargo Against Nicaragua: Hearings, p. 61.Google Scholar

68. See “What U.S. Companies Say About the Nicaraguan Embargo and What They're Doing,” p. 167; and Krauss, “Multinational Corporations Continue to be Crucial to Nicaraguan Economy,” p. 34.

69. Business International, Investing, Licensing, and Trading Conditions Abroad: The Central American Common Market, p. 5.Google Scholar

70. Castle and Cooke Ends Nicaragua Operations that Involved Bananas,” Wall Street Journal, 26 10 1982, p. 19.Google Scholar

71. Coone, Tim, “Embargo-Hit Nicaragua to Sell Bananas in Europe,” Financial Times, 9 05 1985, p. 48.Google Scholar

72. For an overview of these efforts see Hufbauer, , Schott, , and Elliot, , Economic Sanctions Reconsidered, pp. 125–30.Google Scholar

73. Ignatius, David, “Tiger of Tripoli: U.S. Seeks to Mobilize Opponents of Khadafy in Libya and Outside,” Wall Street Journal, 14 07 1981, p. 16.Google Scholar

74. Martin, Douglas, “Why Mobil Behaves That Way,” New York Times, 20 12 1981, section 3, p. 4.Google Scholar

75. Smith, Terrence, “Companies Resisting U.S. Foreign Policy,” New York Times, 27 06 1981, p. 37.Google Scholar

76. Friedman, Thomas L., “Exxon to End its Oil and Gas Output in Libya,” New York Times, 13 11 1981, p. D5.Google Scholar

77. Turner, Terisa, “U.S. Oil Giants have Become Part of Reagan's Plan to Destabilize Libya,” Multinational Monitor 2 (12 1981), pp. 1214.Google Scholar

78. “Libya: Exxon Secures Compensation,” Petroleum Economist, 02 1982, p. 69.Google Scholar

79. For an explanation of why the independents did not follow the majors' lead in leaving Libya, see “Exxon to Pull Out of Libya,” Petroleum Economist, 12 1981, p. 531.Google Scholar On the relationship between the independents and Libya in the early 1970s, see Turner, , Oil Companies in the International System, pp. 154–61.Google Scholar

80. Reagan Orders Economic Sanctions Against Libya,” Oil and Gas Journal, 13 01 1986, p. 38.Google Scholar

81. MacKinnon, Colin, “Libya: U.S. Companies to Leave,” Middle East Executive Reports, 06 1986, p. 7.Google Scholar

82. George P. Shultz to Ronald Reagan, memorandum; “Libyan Trade Sanctions,” 3 January 1986 (document obtained through the Freedom of Information Act).

83. Telephone interviews with representatives with two of the departing U.S. oil companies (Conoco and W.R. Grace), 13 and 16 June 1988. That public officials are satisfied with company claims of voluntary enforcement was confirmed by two personal interviews with officials in the U.S. Treasury Department's Office of Foreign Assets Control, Washington, D.C., 26 and 29 July 1988, and one personal interview with an official in the U.S. State Department's Office of East–West Trade, Washington, D.C., 28 July 1988.

84. “Libya: U.S. Role Could Further Diminish,” Petroleum Economist, 04 1984, p. 154.Google Scholar

85. Johnson, Bill, “Occidental to Sell 25 Percent of Interests in Libya,” Wall Street Journal, 21 06 1985, p. 32.Google Scholar

86. Personal interview with Robert Bonczak, general counsel, Conoco, New York, 6 July 1988. Also see Hawley, David, “Libyan Sanctions—Reagan's Damp Squib,” Middle East Economic Digest, 28 01 1986, p. 7.Google Scholar

87. See Roberts, John, “Libya: U.S. Oil Companies Get Deadline to Quit,” Middle East Economic Digest, 10 05 1986, p. 22Google Scholar; Hershey, Robert D., “U.S. Trade with Libya Continues,” New York Times, 9 12 1986, p. D1Google Scholar; and Baquet, Dean, “U.S. Companies Use Affiliates Abroad to Skirt Sanctions,” New York Times, 27 12 1993, p. A1.Google Scholar

88. U.S. General Accounting Office, Libyan Trade Sanctions, report NSIAD-87–132BR (Washington, D.C.: U.S. General Accounting Office, 05 1987), p. 19.Google Scholar

89. Two telephone interviews with U.S. firms that terminated operations, 16 June 1988 and 5 August 1988. Personal interview with an official of the U.S. Treasury Department, Office of Foreign Assets Control, 29 July 1988.

90. MEED has Looked at Problems for Contractors Working in Libya by Payment Delays,” Middle East Economic Digest, 3 09 1986, p. 20.Google Scholar

91. Miller, Clement, “North Africa's Oil Exporters,” Middle East Executive Reports, 2 02 1987, p. 4.Google Scholar

92. Levy, Brian, “World Oil Marketing in Transition,” International Organization 36 (Winter 1982), pp. 113–33CrossRefGoogle Scholar and p. 127 in particular.

93. See Alan, George, “Drastic Fall in Oil Revenues,” Petroleum Economist, 06 1986, p. 218Google Scholar; and Libya Resists Customers' Requests to Offer Lower Prices,” Middle East Economic Survey, 10 03 1987, p. A3.Google Scholar

94. The policy was based in large part on Chester Crocker's article, South Africa: Strategy for Change,” Foreign Affairs 59 (Winter 19801981), pp. 323–51.CrossRefGoogle Scholar

95. Coker, Christopher, The United States and South Africa, 1968–1985: Constructive Engagement and its Critics (Durham, N.C.: Duke University Press, 1986), pp. 210–13.Google Scholar

96. Ibid., pp. 213–15.

97. Price, Robert M., The Apartheid State in Crisis: Political Transformation in South Africa, 1975–1990 (New York: Oxford University Press, 1991), p. 222.Google Scholar

98. Felton, John, “Huse Accepts Senate's Anti-Apartheid Bill,” Congressional Quarterly Weekly Report, 13 09 1986, pp. 2119–20.Google Scholar

99. U.S. Department of State, Report to Congress on Industrialized Democracies' Relations with and Measures Against South Africa (Washington, D.C.: Department of State, 12 05 1987).Google Scholar

100. Becker, Charles M., “Economic Sanctions Against South Africa,” World Politics 39 (01 1987), pp. 147–73.CrossRefGoogle Scholar

101. Investor Responsibility Research Center (IRRC ), “Summary of U.S. Sales to the South African Public Sector,” South Africa Review Service, May 1988, p. 3.

102. Business International, Critical Issues Monitor, 12 1986, p. 26.Google Scholar The logic is spelled out in the testimony of Robert Cornell, U.S. Treasury Department, in U.S. Congress, House Committee on Foreign Affairs, The Anti-Apartheid Act of 1985: Hearings Before the Committee on Foreign Affairs, 99th Congress, 1st sess., 9 May 1985, p. 129.Google Scholar

103. Ovenden, Keith and Cole, Tony, Apartheid and International Finance: A Program for Change (Victoria, Australia: Penguin, 1989), pp. 82–84 and 189.Google Scholar

104. IRRC, “Summary of U.S. Sales to the South African Public Sector,” p. 3.

105. See Anti-apartheid Without Tears,” The Economist, 30 03 1985, p. 22Google Scholar; and Loss of Business Confidence is a Sanction on South Africa,” The Economist, 21 06 1986, p. 67.Google Scholar

106. Frost Sullivan's ranking is cited on p. 809 of Harris, Laurence, “South Africa's External Debt Crisis,” Third World Quarterly 8 (07 1986), pp. 793817.CrossRefGoogle Scholar

107. Ibid., pp. 806–7.

108. See the Business International newsletter, South Africa Alen, 16 07 1986, p. 2.Google Scholar

109. Voorhes, Meg, A Guide to American State and Local Laws on South Africa (Washington, D.C.: IRRC, 06 1990).Google Scholar

110. IRRC, Withdrawal of U.S. Companies from South Africa, Social Issues Service, Proxy Issues Report, analysis C (Washington, D.C.: IRRC, 13 12 1988), pp. 1415.Google Scholar

111. See David Tonge and Quentin Peel, “How South Africa Won its Billion Dollar Battle in the IMF, ” Financial Times, 25 01 1983, p. 4Google Scholar; and Coker, , The United States and South Africa, 1968–1985, pp. 211–12.Google Scholar

112. On the role of the IMF in preventing such scenarios, see Lipson, Charles, “Bankers' Dilemmas,” World Politics 38 (10 1985), pp. 200225.CrossRefGoogle Scholar For a prescient analysis of how removing this role would place economic pressure on South Africa, see Gisselquist, David, “International Monetary Fund Relations with South Africa,” in United Nations General Assembly, Question of Namibia, 37th sess., Document A/37/568, 25 10 1982, pp. 2533.Google Scholar

113. Hufbauer, , Schott, , and Elliot, , Economic Sanctions Reconsidered, p. 246.Google Scholar

114. “Loss of Business Confidence is a Sanction on South Africa.” Also see Price, , The Apartheid State in Crisis, p. 229.Google Scholar

115. For an overview of the three accords, see Bradlow, Daniel D., “Debt, Development, and Human Rights: Lessons from South Africa,” Michigan Journal of International Law 12 (Summer 1991), pp. 647–89Google Scholar; see especially pp. 659–68.

116. South Africa's Foreign Debt: A Spur to Economic Reform,” Financial Mail (South Africa), 13 10 1989, p. 32.Google Scholar

117. Becker, “Economic Sanctions Against South Africa,” p. 164.

118. Bradlow, “Debt, Development, and Human Rights,” p. 665.

119. For an analysis of the impact of constructive engagement on business confidence, see Business International S.A., A Fresh Look at South Africa (Geneva: Business International, 10 1982), pp. 512.Google Scholar For articles reporting specific cases, see America and South Africa: Trade Follows the Flag,” The Economist, 19 09 1981, pp. 8485Google Scholar; and South Africa Draws Investors,” New York Times, 3 11 1982, p. D1.Google Scholar

120. Marching from Pretoria: Amid Mounting Pressures Most MNCs Plan to Stay,” Business International, 1 03 1985, p. 67.Google Scholar Also see Price, , The Apartheid State in Crisis, p. 230.Google Scholar

121. Cowell, Alan, “The Ambiguity of South African Divestment,” New York Times, 31 12 1986, p. D3.Google Scholar

122. Hauck, David, What Happens when U.S. Companies Sell their South African Operations (Washington, D.C.: IRRC, South Africa Research Service, 05 1987), p. 8.Google Scholar

123. Ibid., pp. 8–10.

124. See Cohen, Benjamin J., ln Whose Interest? International Banking and American Foreign Policy (New Haven, Conn.: Yale University Press, 1986), pp. 7279.Google Scholar

125. On Angola, see “Angola Most Creditworthy U.S. Partner in Africa says Official,” Inter Press Service, 10 February 1986, Mead Data Central, Inc., LEXIS-NEXIS; Friedland, Jonathan, “U.S., Foreign Banks Back Exploration of Oil in Angola,” American Banker, 6 08 1985Google Scholar; and Woodsworth, Nicholas, “Oil Fuels Angola's Prosperous Prospects,” Financial Times 4 05 1989.Google Scholar On China, see White, George, “U.S. Firms Lift Taboo on Doing Business in Beijing,” Los Angeles Times, 1 12 1990, p. D1Google Scholar; and Kristof, Nicholas D., “Foreign Investors Pouring into China,” New York Times, 15 06 1992, p. D1.Google Scholar

126. Verdon, Lexie, “House Panel Bars U.S. Vote for IMF Aid to South Africa: Political Precedent Worries Some Members,” Washington Post, 6 05 1983, p. 5.Google Scholar

127. Cohen, In Whose Interest? chap. 7.

128. For an explanation of why large diversified corporations may be more receptive to public preferences than smaller firms, see Krasner, Stephen D., Defending the National Interest: Raw Materials Investments and U.S. Foreign Policy (Princeton, N.J.: Princeton University Press, 1978), pp. 7582.Google Scholar

129. Jentleson, , Pipeline Politics, p. 205.Google Scholar

130. IRRC, “Divestment Roundup,” South Africa Review Service, February 1987, pp. 2–3.

131. Rodman, Kenneth A., Sanctity Versus Sovereignty: The United States and the Nationalization of Natural Resource Investments (New York: Columbia University Press, 1988), pp. 239–41 and 264–65.Google Scholar

132. See Smith, Donna, “Administration's Ambiguous Approach Welcomes U.S. Oil Investment in Angola,” Oil Daily, 2 04 1982, p. 1Google Scholar; and testimony of Chester Crocker, in U.S. Congress, Senate Committee on Foreign Relations, Angola—Options for American Foreign Policy: Hearings Before the Senate Committee on Foreign Relations, 99th Congress, 2d sess., 18 02 1986, pp. 8Google Scholar, 12, and 18–19.

133. See U.S. Allies Angered by New Cuba Bill,” Business Latin America, 26 10 1992Google Scholar; Pearson, John, “Fidel's End Run Around Uncle Sam: Cuba is Attracting More Foreign Investors,” Business Week, 9 05 1994, p. 47Google Scholar; and Baquet, “U.S. Companies Use Affiliates Abroad to Skirt Sanctions.” p. A1.

134. Mastanduno, , Economic Containment, pp. 241–42 and 248–51.Google Scholar

135. On the administration positions, see U.S. General Accounting Office, South Africa: Status Report on Implementation of the Comprehensive Anti-apartheid Act, report NSIAD -88–44 (Washing-ton, D.C.: U.S. General Accounting Office, 10 1987), pp. 1–3 and 56Google Scholar; MacDougall, Gay, “Implementing the Anti-apartheid Act of 1986,” in Edgar, Robert E., ed., Sanctioning Apartheid (Trenton, N.J.: Africa World Press, 1990), pp. 1956Google Scholar, especially pp. 23–37; and Pear, Robert, “Despite Sanctions, Steel from Pretoria is Entering the U.S.,” New York Times, 14 04 1990, p. A1.Google Scholar

136. For a discussion of why human rights lobbying efforts have had less of an impact on investor behavior in China, see Gargan, Edward A., “Business Objects to a Code in China,” New York Times, 24 05 1994, p. D2.Google Scholar For more on the role of interest groups directly pressuring corporations in South Africa, see Rodman, Kenneth A., “Public and Private Sanctions Against South Africa,” Political Science Quarterly 109 (Summer 1994), pp. 313–34.CrossRefGoogle Scholar

13
Cited by

Save article to Kindle

To save this article to your Kindle, first ensure coreplatform@cambridge.org is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Sanctions at bay? Hegemonic decline, multinational corporations, and U.S. economic sanctions since the pipeline case
Available formats
×

Save article to Dropbox

To save this article to your Dropbox account, please select one or more formats and confirm that you agree to abide by our usage policies. If this is the first time you used this feature, you will be asked to authorise Cambridge Core to connect with your Dropbox account. Find out more about saving content to Dropbox.

Sanctions at bay? Hegemonic decline, multinational corporations, and U.S. economic sanctions since the pipeline case
Available formats
×

Save article to Google Drive

To save this article to your Google Drive account, please select one or more formats and confirm that you agree to abide by our usage policies. If this is the first time you used this feature, you will be asked to authorise Cambridge Core to connect with your Google Drive account. Find out more about saving content to Google Drive.

Sanctions at bay? Hegemonic decline, multinational corporations, and U.S. economic sanctions since the pipeline case
Available formats
×
×

Reply to: Submit a response

Please enter your response.

Your details

Please enter a valid email address.

Conflicting interests

Do you have any conflicting interests? *