A Primer on 21st-Century Economic Weapons

A review of Edward Fishman, “Chokepoints: American Power in the Age of Economic Warfare” (Portfolio Penguin, 2025).

Economic sanctions and export controls represent the two most powerful offensive economic national security weapons in the American arsenal. With the stroke of a pen (and now, a felt-tipped marker), the United States can unleash its economic might against adversaries to deny them access to the U.S.-dominated global financial system and high-tech supply chains. 

Ideally, these tools support broader foreign policy and national security objectives. Often, as the Treasury Department itself has acknowledged, they serve as tools of first resort: something stronger than mere diplomatic posturing yet less perilous than military action—the “middle ground between words and wars.” The ease of execution and generally low marginal cost of individual designations encourages frequent use of the tools. This perceived low cost belies a more complicated reality. Additionally, the more frequently and less precisely the tools are used, the less effective they become over time. Almost a decade ago, then-Treasury Secretary Jack Lew cautioned about the pitfalls of sanctions overuse. Yet the first Trump and Biden administrations dramatically expanded the number of sanctions designations during their tenures. Some policymakers and scholars worry that their overuse will precipitate the demise of the U.S. dollar as the world’s predominant reserve and trade currency. Demands on the tiny and chronically overstretched Commerce and Treasury Department bureaucracies continue to grow without commensurate staffing and budget increases. What is clear is that sanctions, export controls, and now tariffs will remain firmly in the economic national security arsenal as the second Trump administration takes shape.

The use (and misuse) of these economic tools over the past two decades lies at the heart of Edward Fishman’s “Chokepoints: American Power in the Age of Economic Warfare.” Through a detailed and engaging diplomatic history, “Chokepoints” illuminates the often opaque mechanisms of U.S. economic power deployed against adversaries via the U.S.-dominated and U.S.-dollar-denominated global financial system and, more recently, U.S.-developed advanced semiconductor technologies supply chain.

Fishman, a scholar at Columbia University and former official at the Defense, State, and Treasury Departments, draws on his extensive experience as a national security practitioner to unpack the often byzantine world of economic bureaucratic politics at home and overseas. “Chokepoints” builds upon—and contributes to—a growing body of literature on economic statecraft over the past several years with Henry Farrell and Abraham Newman’s “Underground Empire: How America Weaponized the World Economy,” Saleha Mohsin’s “Paper Soldiers: How the Weaponization of the Dollar Changed the World Order” (previously reviewed on Lawfare), Stephanie Baker’s “Punishing Putin: Inside the Global Economic War to Bring Down Russia,” Chris Miller’s “Chip War: The Fight for the World’s Most Critical Technology,” Eva Dou’s “House of Huawei: The Secret History of China’s Most Powerful Company,” and Agathe Demarais’s “Backfire: How Sanctions Reshape the World Against U.S. Interests” (previously reviewed on Lawfare). What sets Fishman’s book apart from these other important contributions is his ability to weave together a diplomatic history with a detailed and technical explanation of how economic weapons affect companies and industries.

Spanning two decades of U.S.-led economic warfare, “Chokepoints” catalogues the novel uses of economic sanctions and export controls to target increasingly adaptive adversaries. This game of cat and mouse began with a redoubled economic campaign against Iran under the George W. Bush and Obama administrations, especially to leverage the full force of private foreign financial institutions to deny Iran access to the global financial system. The playbook for Iran then informed the U.S. and European response to Russia’s first invasion of Ukraine in 2014. Policymakers struggled to calibrate sanctions to alter Russian behavior while avoiding economic blowback at home from oil and gas price spikes and supply disruptions while attempting to maintain a coalition with Europe. Fishman characterizes the first Trump administration as largely ineffectual in its use of mostly unilateral sanctions that antagonized European and other allies. On the plus side, Trump appointees innovated with novel technology export control restrictions against China by targeting its state champions Huawei and ZTE. These experiences informed the Biden administration’s combining of these sanctions and export control authorities to respond to Russia’s expanded invasion of Ukraine in 2022 while seeking to hamper China’s acquisition of U.S. and allied cutting-edge semiconductor technologies for defense and artificial intelligence advances.

Like some other accounts of economic statecraft and economic warfare, “Chokepoints” focuses on several high-profile episodes to build a compelling, well-structured narrative. Fishman meticulously details the diplomatic and bureaucratic play-by-plays as fast-moving crises spawn creative responses.

Fishman’s intimate knowledge of the inner workings of the State and Treasury Departments as well his experience with the National Security Council and European counterparts enable him to excel at offering detailed accounts of the bureaucratic turf battles that often lie unseen behind the issuance of sanctions. This book pays homage to the quiet, capable professionals working in the Treasury Department’s Office of Foreign Assets Control (OFAC) and Office of Terrorist Financing and Financial Crimes, the Commerce Department’s Bureau of Industry and Security, the State Department’s Office of Sanctions Coordination, and the National Security Council’s International Economics directorate. While the internecine rivalry between the State and Treasury Departments is appreciated by current and former officials, the book’s treatment gives color and some shade to how seemingly well-polished press releases, sanctions designations, and Group of Seven communiques actually come together. The book methodically draws out how seemingly exhausted sanctions against Iran took on new life when U.S. officials persuaded European banks to comply, how “scalpel”-like sectoral sanctions based on debt and equity restrictions designed to curb Russian President Vladimir Putin’s initial ambitions in Ukraine took shape, how the “technological counteroffensive” against China developed under the first Trump administration, and how U.S. officials created the oil price cap scheme against Russia in 2022.

The author hits his stride in the book’s chapters on Russia’s first invasion of Ukraine, which vividly draws from his firsthand experience in government during this period and thus his access to key decision-makers. Attempts by the United States in 2014 to use energy sanctions to “try to constrain Russia’s prospect for growth in the future, not create an immediate economic shock” highlight the delicate policy balances that often limit the effectiveness of sanctions. The inability of sanctions (as well as the threat of sanctions) to deter Russia’s expanded invasion of Ukraine in 2022 further demonstrates that sanctions are merely one policy tool, not a policy solution. Also in the current moment, these bureaucratic profiles in particular read like an elegy to high-minded public service as the new administration seeks to inflict “trauma” on the federal workforce. The economic national security bureaucracy is not immune from these ongoing efforts and will likely be weakened and demoralized by purges, leaving an understaffed workforce, especially in highly technical areas such as sanctions, export controls, and, when needed in the Iran context, nuclear nonproliferation. 

However, the focus on these important episodes provides an opportunity for further scholarship to describe the full U.S. and allied arsenal in the economic domain. The book at times overlooks or understates the chokepoints administered by other parts of the federal government, especially law enforcement and financial regulators, to target malign actors, including for sanctions and anti-money laundering violations. The charm and pressure of U.S. officials appearing in foreign capitals and financial centers no doubt influenced governments, financial institutions, and technology companies. Yet behind these words were the long arm of the U.S. legal and regulatory systems, even when enforcement resources may be lacking. The result was eye-popping multibillion-dollar fines and criminal prosecutions for sanctions violations spanning marquee European financial institutions (the book briefly notes a “record-shattering $9 billion fine”) and senior bankers from NATO ally Turkey.

The evolving toolkit against China deserves further treatment, as policymakers have used creative interagency tools, for instance, to address human rights violations such as through the Department of Homeland Security’s Customs and Border Protection authorities under the Uyghur Forced Labor Prevention Act (UFLPA) of 2021 and the Treasury Department Financial Crimes Enforcement Network’s USA PATRIOT Act Section 311 authority to disrupt Chinese support to North Korea’s weapons proliferation efforts by targeting China’s Bank of Dandong.

To truly understand “economic warfare,” additional research and scholarship should also focus on the role of the Defense Department as a market participant as well as the economic effects of the military during active conflicts such as the wars in Iraq and Afghanistan (and what such effects may look like in the Indo-Pacific theater). 

Focusing on Iran, Russia, and China also provides less space to analyze other ways that the United States has deployed its economic arsenal, refined its financial weapons, and suffered setbacks in responding to other hostile countries and threats, including North Korea (briefly mentioned in the first section), Venezuela, anti-corruption and serious human rights abuses, cybersecurity attacks (including Russian election interference), sanctions evasion through digital assets, terrorist financing (such as through the interagency and coalition counter-ISIS campaign), and narcotics trafficking (now emerging as a “new war on drugs” involving tariffs, fentanyl, and expanded designations of drug-trafficking organizations) as well as the humanitarian impacts of sanctions. As reinforced through recent Trump administration executive actions, the U.S. economic chokepoint toolkit also includes inbound and outbound investment review mechanisms such as the Committee on Foreign Investment in the United States and the Outbound Investment Security Program.

The focus on Iran, Russia, and China allows for an examination of topics like the domestic constituencies around sanctions and export controls. Whereas the Iran campaign evoked widespread support for strong sanctions, proposed actions against Russia in 2014 elicited concern from the business community and those with other interests in the Russian economy. A U.S. oil major led by a future secretary of state opposed sanctions against Russia and eventually sued OFAC and won in response to an enforcement action involving a Russia-related venture. Advanced technology companies have significant business interests in China in addition to contending with the country’s global manufacturing dominance. One senior Biden administration official noted the lagging compliance of technology companies with U.S. laws as compared with the state of the financial industry after the 9/11 attacks. Fishman synthesizes a critical observation at the end when he notes that “America would have wider latitude to craft effective sanctions if White House officials were not constantly fixated on gasoline prices.” The overlay of major sanctions programs in hydrocarbon-rich countries (Iran, Russia, and Venezuela)—and especially the Obama and Biden administrations’ reluctance to target the Russian oil and gas industries in 2014 and 2022 through late 2024—demonstrates the challenge of using these economic authorities.

Lastly, Fishman grapples with the question of the efficacy of U.S. sanctions and export controls. The book provides vital insights on the need for stronger “analytical infrastructure” supporting the use of economic weapons ranging from better economic analysis, to improved planning and training functions, and stronger market surveillance capabilities to identify emerging risks. Fishman’s findings are consistent with late Biden administration thinking and outside recommendations to upgrade the economic national security bureaucracy to manage existing crises and prepare for potential conflict with China. The 2023 establishment of an economic analysis unit within the Treasury Department’s OFAC constitutes the most public demonstration of a commitment to build such infrastructure, but many more resources are necessary (albeit unlikely in the current environment). An interagency economic security strategy could be a low-resource step to better assess existing capabilities with needs.

So where do we go from here? As the economic statecraft vision of the second Trump administration begins to take shape, “Chokepoints” serves as an essential guide for some of the key battles in U.S. economic warfare over the past two decades. It also communicates a cautionary tale about the limitations of the U.S. economic national security toolkit, even at the apex of domestic and allied coordination.