WARFARE has been transformed by drones. Using pilotless aircraft armed with precision weapons America can kill its enemies—in, say, the Hindu Kush or Syria—with a click of a mouse. There is a similar shift in economic diplomacy, where Uncle Sam has perfected new weapons that exploit its power over the world’s financial plumbing and over the brainiest parts of the tech industry. In April these weapons were used in anger on big, important firms for the first time. The targets were Rusal, a Russian metals firm, and ZTE, a Chinese electronics company. The results have been devastating—and alarming.
In 1919 Woodrow Wilson called international sanctions a “silent, deadly remedy” and over the next 70 years America deployed them about 70 times, reckons Gary Hufbauer of the Peterson Institute. America achieved its geopolitical objectives only a third of the time, he says. But there was little doubt that it could meet its narrower goal of inflicting pain by halting trade with other countries and by...Continue reading