Introduction: The Renaissance Without a Blueprint
Economic warfare is experiencing what Ian Lesser calls a "renaissance."1 After decades in which sanctions, export controls, and financial restrictions served as second-order instruments of foreign policy, they have moved to the center of great-power competition. The United States now maintains sanctions programs against more than thirty countries. It restricts semiconductor exports to China through the most ambitious technology denial regime since the Cold War. It screens inbound foreign investment through the Committee on Foreign Investment in the United States (CFIUS) and, since August 2023, outbound investment in sensitive technologies through executive order. It has frozen roughly USD 300 billion in Russian central bank assets and imposed over 16,000 individual and entity designations in response to the war in Ukraine. As Edward Fishman observes, "the exponential growth of U.S. economic warfare tools over the past two decades has outpaced the growth of the state apparatus backing them."2
The scale of this deployment is not in question. The Office of Foreign Assets Control (OFAC) alone manages designations on more than 17,000 individuals and entities.3 The Bureau of Industry and Security (BIS) administers export controls spanning dual-use technologies, advanced semiconductors, and quantum computing components. The State Department coordinates diplomatic enforcement. The intelligence community tracks evasion networks. The National Security Council (NSC) sets strategic direction. And hundreds of offices spread across more than a dozen departments and federal agencies share authorities and tools relevant to what the government now calls "economic security."4
What is in question is whether any of this is organized to work.
Farrell and Newman's foundational work on weaponized interdependence identifies two conditions for the effective exercise of economic coercion: control over central nodes in global economic networks, and "appropriate domestic institutions and norms."5 The United States manifestly meets the first condition. It controls the critical chokepoints of global finance, technology supply chains, and digital infrastructure. Whether it meets the second is the question this article addresses.
Between January and April 2026, War on the Rocks published an eleven-part series in partnership with the Potomac Institute for Policy Studies examining how the United States should "organize, lead, and integrate economic statecraft into strategy, defense practice, and the broader national security ecosystem."6 Alongside this series, Peter Harrell published a major essay in Foreign Affairs calling for a coherent economic warfare doctrine, and the Center for a New American Security (CNAS) issued a proposal to adapt military doctrinal methods to economic coercion. Taken together, these contributions represent the most concentrated cluster of policy contributions on institutional design in recent years.
Welter and McWeeney describe economics as "an operational domain of warfare" comparable to land, sea, air, space, and cyber.7 If that is right, the United States is fighting a war in a domain for which it has no dedicated command, no unified intelligence, no doctrine, no grand strategy, and no training pipeline.
Before proceeding, two framing points are necessary. The first concerns definitions. Three terms are in circulation and they describe different things. Economic statecraft refers to the full range of peacetime instruments by which states pursue strategic objectives through economic means, including investment facilitation, development finance, market access, and the deployment of capital alongside coercive tools. Economic warfare refers to the subset of statecraft directed against an adversary, the campaigns of sanctions, export controls, asset freezes, and financial denial that pursue strategic objectives short of armed conflict. Economic security refers to the defensive posture against the same instruments wielded by others, the architecture of resilience, supply chain reshoring, and protection of critical technologies. This article uses warfare framing for sanctions, export controls, and investment restrictions because those tools are now deployed in campaigns explicitly described by their architects as adversarial and coercive, even where the United States is not at war in the constitutional sense. The institutional machinery the article calls for would serve all three functions, but the most acute capability gaps sit on the warfare side, which is where this article concentrates.
The second framing point concerns what military doctrine calls a theory of victory. Every established domain of warfare rests on a theory of domain control: sea control enables power projection, air superiority enables ground operations, information dominance enables decision advantage. Economic statecraft has no equivalent. The United States has never articulated what economic domain control means, what winning in geoeconomic competition looks like, or how the relationship between economic pressure and strategic outcomes should be theorized. Without a theory of victory, every tool is deployed tactically, and institutional reform produces capacity without direction.
A structural observation shapes the analysis that follows. The United States is a democratic republic with a federalist system, three co-equal branches of government, and constitutionally mandated divisions of power between federal, state, and local authorities. It will never be as politically responsive as an authoritarian regime or a parliamentary system. That is a feature of the constitutional design, not a bug. The question is not why the United States is slower to organize than China, but why it has failed to build institutional capacity that other democracies, including the United Kingdom, Japan, and the European Union, have managed within their own constitutional constraints.
A note on method and scope. The five contributions discussed here, the eleven-part War on the Rocks series, Peter Harrell’s Foreign Affairs essay, Hossier’s and Kilcrease’s CNAS doctrinal pieces, are treated as a representative sample of the most concentrated cluster of policy contributions on the institutional design of American economic warfare published between January and April 2026. They are not the whole literature. Earlier work by Singh on positive economic statecraft, Lorber on economic security strategy, and Lew on sanctions overreach is engaged where it bears on the argument. The October 2022 semiconductor export controls on China are used as a single demonstrative case because they remain the most fully documented campaign in which all six layers interact within a single decision sequence and a publicly visible timeline of execution failures. The aim is not to survey every contribution but to show how a structural reading of contemporary policy thinking exposes the architecture beneath the diagnoses.
Layer One: The Intelligence Deficit
The foundation of any warfare capability is situational awareness. In kinetic conflict, this means knowing where the adversary's forces are, what they intend, and how they are likely to respond. In economic warfare, the equivalent would mean understanding how an adversary uses lawful commercial activity, minority equity stakes, joint ventures, and technology licensing agreements to build strategic leverage over time. The United States does not have this capability.
This is the argument Karyn Eliot and Jennifer Buss advance in “Fighting an Economic War Without Fused Intelligence,” the third article in the War on the Rocks series.8 Both bring direct intelligence community experience. Their core proposition is that the intelligence community remains structured around kinetic threats. It excels at tracking missile programs, troop movements, and terrorist financing. It is not structured to evaluate how adversaries use commercial relationships to advance long-term strategic objectives.
The problem is not an absence of economic intelligence collection. The CIA, DIA, NSA, and the intelligence offices in DHS, State, and Treasury all collect economic data within their respective mandates. The problem is that no single intelligence agency is statutorily responsible for fusing this information into a single operating picture for economic customers. As a result, policy customers across the system act without seeing the full board: OFAC makes sanctions designations, BIS makes export control decisions, CFIUS makes investment screening judgments, DOD makes acquisitions decisions, and USTR and Commerce effect trade policy.
The practical consequences are visible in real time. The United States administers more than thirty sanctions programs simultaneously, and understanding how action in one program affects the others requires an integrated intelligence picture that no agency currently produces. CNAS data shows that in 2025, the administration decreased economic statecraft targeting Russia while surging sanctions against Iran and transnational crime. Chinese persons accounted for the largest share of new SDN List designations, predominantly for facilitating Iran sanctions evasion. The Russia reduction may reflect a deliberate policy choice rather than an intelligence failure. The point is that the system cannot demonstrate the difference. There is no fused product showing the interaction effects across all three sanctions theaters, no assessment of whether relaxing pressure on Russia to manage oil prices undermines leverage over Iran, and no mechanism for telling decision-makers what de-escalation in one theater does to coercive credibility in another. An intelligence system built for kinetic threats cannot answer questions it was never designed to ask.
The intelligence problem extends beyond government. The private sector possesses vast quantities of commercially relevant intelligence, shipping data, trade finance records, supply chain mapping, beneficial ownership information, that the government cannot access systematically. No institutional framework exists for this partnership, and no existing intelligence agency has the mandate or analytic workforce to do this. Building economic intelligence fusion requires creating an entirely new institutional relationship between government intelligence and private-sector information.
This was not always the case. During the Second World War, the Board of Economic Warfare and its successor, the Foreign Economic Administration, maintained integrated economic intelligence alongside export control and foreign procurement functions. Both were abolished in 1945. The Cold War produced a partial substitute in COCOM for export controls, but it was a multilateral coordination mechanism, not an intelligence fusion center. For eighty years, the United States has waged economic campaigns without purpose-built intelligence infrastructure.
The gap is not absolute. The Office of the Director of National Intelligence established the Office of Economic Security and Emerging Technology (OESET) to coordinate intelligence on technology supply chains, investment security, and emerging technology applications. OESET represents an institutional acknowledgment that economic actions constitute strategic threats. It advises the community on investments; it does not direct. The distance between OESET’s current capacity and the economic intelligence fusion capability that Eliot and Buss argue is necessary is the distance between a liaison office and a combatant command.
Congress has attempted to address the gap legislatively. Section 309 of the Intelligence Authorization Act for Fiscal Year 2026, originating from a 2024 Congressional request for information answered by Shannon Corless, then the Assistant Secretary at Treasury’s Office of Intelligence and Analysis, proposed expanding OIA’s mandate to provide intelligence support to all departments that did not already have an intelligence organization, such as Commerce, USTR, DFC, and others. Accordingly, OIA would be renamed as the Office of Economic Intelligence and Security within Treasury's TFI. This approach aimed to address a growing demand for intelligence support at other departments and agencies while keeping the number of intelligence community agencies flat. The alternative, admitting Commerce and eventually the other economic departments into the intelligence community as full members, would have expanded the community’s size, oversight burden, and clearance infrastructure each time a new department developed a demand for intelligence support.
The provision exposed the jurisdictional fault line at the heart of the intelligence deficit: Treasury is already a member of the intelligence community, but Commerce, which administers the export controls that generate some of the most strategically significant economic data, is not. The contention between Treasury and Commerce over which department should own the economic intelligence authority prevented the provision from passing in its intended form. The episode illustrates a pattern this article will return to: even when policymakers identify the correct institutional gap, the political economy of existing jurisdictional claims prevents them from filling it.
Layer Two: Organizational Fragmentation
Even if the intelligence problem were solved, a second layer of dysfunction would remain. This is the organizational problem that William Norris diagnoses in "Economic Statecraft and the Federal Institutional Architecture."9 Norris argues that the federal architecture scatters economic warfare authorities across agencies in ways that prevent coherent action.
The distribution is familiar to practitioners but worth spelling out. Treasury’s TFI houses OFAC, FinCEN, and OIA. Commerce houses BIS and the International Trade Administration. State houses the Office of Sanctions Coordination and the Bureau of Economic and Business Affairs. The NSC and NEC share White House coordination; a shared International Economics (INTECON) directorate was functionally disbanded in 2025. CFIUS includes representatives from Defense, State, Commerce, and Homeland Security; the NSC participates as an observer.10 The GAO found more than ten agencies with substantive sanctions roles beyond the three principal departments. The 2021 Treasury Sanctions Review acknowledged that “meaningful changes will depend on whether the State Department, NSC, and other interagency partners agree,” implicitly conceding Treasury cannot reform even its own domain without cross-agency consent.
The consequences are measurable. The GAO found that BIS workforce planning "falls short of key practices" even as its workload surges. Export license applications increased 53 percent and Entity List additions increased 151 percent during the review period, while staffing grew from 403 to 585 positions.11 The gap between mandate and capacity widens with each new sanctions package, each new export control rule, and each new congressional requirement. As the Atlantic Council observed, "despite reliance on economic tools to address every foreign policy challenge, there is no central coordinating body tasked with leading deployment of these actions or even coordinating tools in the toolbox."12
Norris’s contribution is to recognize that this is not a coordination failure that better meetings can fix. It is an architectural failure that requires structural reform. The United States lacks a professional cadre trained in economic statecraft as a discipline. There is no career track that develops expertise across sanctions, export controls, investment screening, deployment of affirmative capital, and financial intelligence as integrated disciplines rather than bureaucratic silos.
Three broad institutional models have been advanced: an Executive Office coordinating body with directive authority, a standing economic security fusion center modeled on the National Counterterrorism Center, and an entirely new department. Daleep Singh has proposed the most comprehensive version of the third: a cabinet-level Department of Economic Security with simulated conflict scenarios, stress-testing comparable to Federal Reserve bank stress-tests, and explicit doctrinal limits including a prohibition on targeting food or medicine. The proposal is intellectually coherent and, for reasons this article will address, politically implausible.
The implausibility is not hypothetical. The most recent attempt at White House-level economic competition coordination, a body known as INTECON that spanned the NSC and National Economic Council, was dismantled. The current administration’s stated objective is to reduce the size of the federal government, not expand it. Any new institutional architecture will therefore have to be forced by Congress rather than created by executive action, and Congress has its own coordination problems.
The Hill is itself disorganized on economic statecraft. The Armed Services Committees have been effective at pushing defense-adjacent legislation, but other committees lag. The DFC reauthorization illustrated the difficulty of moving even modest reforms through a fragmented committee structure. The DPA reauthorization is particularly contentious because the previous administration invoked it for purposes the current majority considers overreach. The failure of section 309 in the prior section is also due in part to disorganization and competing jurisdictions. Legislative proposals exist, but they face an administration that wants fewer agencies, a Congress that cannot agree on jurisdictional ownership, and a political environment that treats institutional expansion with suspicion.
Layer Three: The Doctrinal Vacuum
Before turning to the doctrinal vacuum, a working distinction is needed between doctrine and strategy, because the two are persistently conflated in the contemporary literature and the conflation matters. Doctrine, as used here, is the operational logic of how tools translate into effects within a campaign: how leverage is structured, what failure conditions trigger off-ramps, how proportionality is calibrated, and how second-order consequences are absorbed. Strategy is the framework above doctrine that selects which campaigns to wage and to what end. Strategy answers the question of theory of victory; doctrine answers the question of mechanism. Both are absent in American economic statecraft, but they fail in different ways and require different fixes. Layer Three addresses the doctrinal vacuum; Layer Four addresses the strategic vacuum that sits above it.
The third layer sits above intelligence and organization: the absence of strategic doctrine. This is the ground Peter Harrell covers in "America's New Way of Economic War," published in Foreign Affairs in March 2026, under the subtitle "The Dangers of a Strategy With No Doctrine."13 Harrell has sat in the rooms where these decisions are made. His assessment is that the rooms do not contain a strategic framework.
The core of Harrell's argument is that the United States deploys sanctions, export controls, tariffs, and investment restrictions without a coherent doctrine for when, why, and to what end. There is no equivalent of the military's escalation frameworks, no shared vocabulary for what constitutes success, no articulated theory of how economic pressure translates into political outcomes, and no systematic approach to off-ramps or termination conditions. Each campaign is improvised. Harrell calls for Washington to develop clear principles governing when economic tools are deployed and what legal and strategic bases justify their use.
Lt Col Mary Hossier of CNAS attempts to fill this gap by borrowing directly from military doctrinal methods.14 She proposes distinguishing between three modes of economic statecraft: shaping (restructuring markets and institutions to reduce vulnerability before a crisis), deterrence (maintaining credible threats to prevent undesirable actions), and compellence (applying pressure to force an adversary to change course after the fact). The taxonomy draws on Thomas Schelling's classic distinction between deterrence and compellence, extended to the economic domain.
The absence of doctrine has direct operational consequences. When the United States imposes sanctions, it rarely articulates what the target must do for sanctions to be removed beyond boilerplate policy guidance.15 Off-ramps are improvised or absent. The Russia sanctions illustrate the problem: after more than four years of comprehensive sanctions, there is no publicly articulated framework for what relief would require, no graduated pathway from pressure to relaxation, and no agreed methodology for assessing whether the sanctions are achieving their strategic objectives.16
Emily Kilcrease of CNAS has advanced the most systematic attempt to fill this gap during this research window between January and April 2026. In “Hit It with Your Best Shot: An American Doctrine of Economic Pressure,” published in April 2026, she proposes nine principles for economic pressure doctrine: three strategic principles governing victory conditions, failure metrics, and ethical restraint, and six operational principles governing leverage structuring, ally coordination, and calibration.17 Kilcrease defines economic pressure as the adversarial subset of economic statecraft, a distinction that provides the definitional clarity the field has lacked. Drawing on twenty historical cases spanning embargoes, sanctions, technology denial, and trade coercion, the framework represents the most concrete doctrinal contribution to date. Together with Hossier’s three modes, it demonstrates that the intellectual raw material for doctrine exists. What does not exist is the institutional mechanism to adopt, mandate, and enforce it.
The deeper doctrinal gap is not operational but conceptual. Every established domain of warfare rests on a theory of domain control. Maritime doctrine is built on theories of sea control and sea denial. Air doctrine is built on air superiority. Cyber doctrine is organized around information dominance. These theories of control provide the strategic logic that connects operational activity to strategic outcomes. Economic statecraft has no equivalent. The United States has never articulated a theory of economic domain control in the post-Cold War era: what it means to dominate the geoeconomic environment, how that dominance translates into strategic advantage, and what conditions must be maintained for coercive economic tools to remain effective. Without such a theory, doctrine becomes a collection of operational principles untethered to a strategic purpose.
The absence of a theory of control reflects an ideological obstacle as much as a bureaucratic one. The neoliberal consensus that has dominated Western economics since the 1990s rests on a normative commitment to market-based allocation as both efficient and legitimate. Quinn Slobodian’s history of the neoliberal project shows that the postwar reconstruction of international economic order was explicitly designed to insulate market mechanisms from political contestation, and Philip Mirowski has demonstrated how this commitment was reproduced in academic economics through the postwar professionalization of the discipline. A reviewer might object that the entire architecture of contemporary economic warfare, sanctions, export controls, investment screening, was designed and implemented inside this neoliberal order, and that the objection has force. The architecture exists, but it exists in spite of the academic consensus, not because of it. Practitioners build the tools; mainstream economics departments do not teach the theory that would integrate them. The result is a professional cadre fluent in the operational tradecraft of individual instruments but without the conceptual vocabulary to articulate why and how economic instruments combine into a coherent campaign. The neoliberal obstacle is therefore narrower than a blanket cultural resistance: it is the specific absence, in mainstream economic and policy education, of a discipline that treats economic domain control as a legitimate object of study.
The tariff campaigns of 2025 and 2026 illustrate the vacuum at its most acute. Tariffs on steel, aluminum, automobiles, and a sweeping baseline tariff were announced, escalated, paused, and partially reversed within weeks. No published framework governed targeting, allied exemptions, or how tariff measures related to concurrent sanctions and export control campaigns against the same countries. Each tool was deployed on its own logic, by its own agency, with no institutional process for assessing interaction effects.
Layer Four: The Strategic Vacuum
Even if the United States fixed its intelligence architecture, reformed its organizational design, and developed operational doctrine, it would still lack the overarching strategic framework that gives those capabilities direction. This is the layer that none of the five contributions surveyed above directly addresses, though all of them implicitly depend on it.
During the Cold War, containment provided the strategic north star. From Kennan’s 1947 articulation through NSC-68 and across nine presidential administrations, every instrument of American power had a common reference point. The Marshall Plan, COCOM, financial pressure on the Soviet bloc, and the Bretton Woods institutions all made sense within containment because the strategic purpose was clear. Economic tools were not deployed ad hoc. They were deployed within a grand strategy. No equivalent framework exists for geoeconomic competition with China.
The United States is simultaneously pursuing semiconductor denial, maximum pressure on Iran, financial sanctions on Russia, tariff campaigns against allies and adversaries, inbound screening through CFIUS, and outbound investment restrictions. Each campaign operates on its own logic. Are the United States and China decoupling? De-risking? Competing within shared systems? Building parallel systems? The answer determines which tools matter and which are counterproductive. Without an answer, every tool is deployed tactically.
The absence of strategy reflects a deeper intellectual irresolution. The American policy establishment has not settled the fundamental question of what the economic relationship with China should look like in twenty years. China is simultaneously the largest trading partner, the primary strategic competitor, the most important climate counterparty, largest Iranian oil importer, and the target of the most ambitious technology denial regime. No grand strategy can accommodate all of these relationships without prioritizing some over others, and no political consensus exists for that prioritization.
The constitutional structure of the United States compounds this problem. Parliamentary systems can pivot grand strategy with a change of government. The American system, with its separated powers, competing institutional interests, and four-year electoral cycles, requires broader bipartisan consensus to sustain a strategic framework across administrations. Containment achieved that consensus, though it took nearly a decade of debate. Nothing comparable has emerged for geoeconomic competition. The result is that each administration inherits a collection of economic tools deployed by its predecessors, reorients them toward its own priorities, and leaves office without having established a durable framework for its successors. The instruments accumulate. The strategy does not.
Layer Five: The Human Capital Deficit
The fifth layer cuts across all others. The United States does not have a professional cadre trained in economic statecraft as an integrated discipline. Military officers attend war colleges that require a year of full-time study in strategy, operational art, and joint doctrine. Diplomats attend the Foreign Service Institute for language, area studies, and diplomatic tradecraft. Intelligence officers undergo specialized training at the CIA, DIA, and NSA before assuming analytical or operational roles, along with ongoing professional development. There is no equivalent for economic warfare professionals. The gap is recognized in the practitioner literature, where proposals now exist to import the Defense Department’s approach to doctrine, joint force structure, and training into the civilian economic agencies, including Goldwater-Nichols-style joint duty requirements, and to cultivate what Navin Girishankar calls a class of economic warriors.18
An OFAC sanctions analyst learns sanctions law and compliance procedures within Treasury but receives no formal training in export control methodology, investment screening criteria, intelligence tradecraft, or allied coordination frameworks. A BIS export control officer learns the Export Administration Regulations but receives no systematic exposure to sanctions design, financial intelligence, or the diplomatic dimensions of technology denial. A CFIUS analyst reviews foreign investment transactions without structured training in how those investments relate to sanctions enforcement or technology control objectives. The result is a workforce of specialists who understand their own tools but not the system those tools operate within.
The problem starts in academia. No major university offers a program in economic statecraft or financial warfare as a distinct field of study. Economics departments teach through a lens that treats state intervention as distortion rather than strategy. International relations departments study sanctions as a policy tool but not economic warfare as a warfighting domain. Girishankar, surveying the same landscape in Foreign Affairs, finds that degree programs combining economics, technology, and national security remain rare, and argues that building an economic warrior class will require government, universities, business, and philanthropy to treat the field as a national priority.19 This is a product of the same neoliberal consensus identified in the doctrinal layer: academics trained in that tradition are structurally unable to teach economic warfare doctrine because they have been trained to view the enterprise as intellectually illegitimate. The result is a self-reinforcing cycle: universities do not teach it, government cannot recruit people trained in it, and the absence of trained professionals ensures that institutional reforms would be staffed by people who learned their craft in fragments.
The scale of the deficit is measurable. TFI vacancy rates between fiscal years 2014 and 2019 ranged from 6 to 26 percent of authorized positions even after Congress approved a 58 percent budget increase over the same period.20 BIS grew from 403 to 585 positions while its workload surged 53 percent in license applications and 151 percent in Entity List additions. RAND’s DARPA-sponsored Geoeconomics Summer Study, recruiting emerging scholars for an intensive residency in 2026, signals that the defense establishment recognizes the vacuum.21 But a summer residency is not a training pipeline. What is required is an economic war college: a dedicated institution that develops professionals across the full spectrum of economic statecraft disciplines before they assume coordinating responsibilities. The proposal extends an argument already established in the practitioner literature. Zerden and Smith propose adapting Goldwater-Nichols joint-duty mechanisms and Defense Department training models to the economic agencies; McMaster and Grotto argue that economic statecraft requires an integrated and strategically directed approach rather than ad hoc coordination; Girishankar frames the deficit as a workforce problem requiring deliberate national cultivation.22
Layer Six: Affirmative Statecraft and the Capital Frontier
The first five layers concern the coercive and institutional dimensions of economic warfare: smarter sanctions, better-coordinated export controls, clearer doctrine for coercion. Georgie Skipper's "Follow the Money: Finance and the Future of Allied Economic Statecraft" reframes the problem entirely.23 Skipper argues that the defining instrument of contemporary economic statecraft is not the ability to deny but the ability to direct: mobilizing and allocating capital across defense, infrastructure, manufacturing, and technology to build durable competitive advantages.
This is a fundamentally different institutional challenge. Punitive economic statecraft requires enforcement capacity: the ability to identify targets, freeze assets, block transactions, and prosecute violations. Affirmative economic statecraft requires investment coordination: the ability to signal priority sectors, lower the cost of capital for strategic industries, aggregate allied demand, and build financing platforms that align public objectives with private capital flows. The US institutional apparatus is built, however imperfectly, for the former. It barely acknowledges the latter.
Project Vault offers a partial illustration of what affirmative statecraft looks like in practice. Announced in February 2026 as a public-private partnership for a strategic minerals reserve, the program drew a USD 10 billion Export-Import Bank loan and nearly USD 2 billion in private-sector investment, the largest financing in EXIM's 92-year history.24 The program stores all sixty minerals on the US Geological Survey's 2025 Critical Minerals List in secure domestic facilities, providing a buffer against supply chain disruption. It is a deliberate act of economic statecraft: sovereign financing capacity deployed to reshape market incentives for strategic effect.
But Project Vault is an exception, not a system. There is no institutional framework for systematically identifying where allied capital should flow, coordinating financing across partner governments, or measuring the strategic return on investment. Clayton, Maggiori, and Schreger's formal geoeconomics model, published in Econometrica in January 2026, demonstrates that the US exerts dominance primarily through financial services, controlling 80 to 90 percent of global financial flows for many target countries.25 Skipper's insight is that this financial centrality could be leveraged not just to punish adversaries but to build allied capacity, if the institutional architecture existed to do it.
The tension between punitive and affirmative statecraft is more than theoretical. The European Central Bank and the European Systemic Risk Board found in January 2026 that geoeconomic fragmentation has become a key source of macro-financial uncertainty. Russia has halved its external liabilities since pivoting from Western finance. China is reducing exposure to US assets. Countries distancing from the West are building alternative payment systems, China’s CIPS, Russia’s SPFS, Iran’s SEPAM, while central banks accumulate gold at levels approaching the Bretton Woods era. Russia-China bilateral trade reached a record USD 244 billion in 2024, with national currencies accounting for 99.1 percent of mutual settlements. As Chachko and Newman argue, unilateral measures imposed for parochial reasons face serious legitimacy concerns, and the perception of illegitimacy accelerates counter-measures. Every sanctions designation that pushes a transaction into an alternative settlement system is a self-inflicted reduction in the chokepoint power that makes sanctions possible.
The allied coordination dimension deepens the problem. The G7 mechanisms established after the 2022 Russia invasion, the REPO Task Force, the oil price cap coalition, the agreement to back a USD 50 billion loan to Ukraine with frozen sovereign assets, demonstrated institutional innovation under crisis pressure. But each required extensive ad hoc negotiation among governments with different legal frameworks and risk tolerances. There was no standing coordination body, no pre-negotiated burden-sharing framework, and no shared intelligence picture. IPEF produced a supply chain agreement but no investment coordination mechanism. AUKUS includes advanced technology pillars but no economic statecraft function. The institutional gap extends across the entire allied architecture.
The structural risk is that punitive and affirmative statecraft are not merely complementary but interdependent, and that neglecting the affirmative dimension actively undermines the punitive one. The dollar's dominance as a reserve currency, the centrality of the SWIFT messaging system, the depth of US capital markets, and the reach of the correspondent banking network are all products of institutional investment over decades. They were not built as weapons. They became chokepoints because the United States invested in building an open, attractive, and efficient financial system that other countries chose to use. Every punitive action that gives a target state reason to build an alternative, and every episode of sanctions overreach that gives a neutral state reason to hedge, erodes the infrastructure that makes future punitive action possible. A purpose-built economic statecraft architecture would treat the maintenance and strengthening of these networks as a core mission, not an afterthought. The current architecture does not even assign it to an agency.
The Layers in Practice: Semiconductor Export Controls
The October 2022 semiconductor export controls on China illustrate how all six layers interact in a single campaign. At the intelligence layer, BIS lacked a fused picture of Chinese semiconductor supply chains, forcing reliance on incomplete data about which entities were advancing military AI capabilities. The result was entity definitions with gaps that Chinese firms exploited through corporate restructuring. Hua Hong Group reportedly began readying 7nm chip production capability despite the controls. Nvidia redesigned its AI accelerators multiple times to navigate shifting BIS performance thresholds, creating products that technically complied while still serving the Chinese market.
At the organizational layer, the decision involved BIS (export regulations), OFAC (entity designations), State (allied coordination), the intelligence community (capability assessment), and the NSC (strategic direction). Each brought its own authorities, legal frameworks, risk tolerances, and definition of success. At the doctrinal layer, there were no pre-agreed escalation triggers: when China restructured around the controls, no framework existed for determining whether to tighten, expand, or hold. At the strategic layer, the fundamental question remained unresolved: were the controls part of decoupling or de-risking? The answer determines whether loopholes are tolerable or existential, and nobody in government had been tasked with deciding.
At the human capital layer, the officials designing the controls had learned their craft in fragments: BIS engineers understood performance thresholds but not sanctions evasion patterns; OFAC analysts understood financial networks but not semiconductor supply chains. At the affirmative layer, the controls pushed allied chipmakers toward hedging strategies that weakened the coalition the controls depended on. The Congressional Research Service and CNAS have documented the results: loopholes in entity definitions, allied coordination gaps that permitted re-export through third countries, and enforcement challenges that a unified command would have anticipated. The controls were strategically sound in ambition. The institutional apparatus was not built to execute them coherently across any of the six layers, let alone all of them simultaneously.
Why Nothing Changes: The Political Economy of Fragmentation
The contributions surveyed above share an implicit assumption: that the fragmentation of American economic warfare is a problem to be solved through better design. Eliot and Buss want fused intelligence. Norris wants reformed organizational architecture. Harrell wants strategic doctrine. Hossier wants a military-style doctrinal process. Skipper wants allied capital coordination. Each proposes a renovation of their floor of the building.26
None of them asks why the building was never designed in the first place. The answer, this article contends, is that fragmentation serves institutional interests. It is not a failure of design but a product of competition, and it persists because the actors who would need to cede authority to enable consolidation have no incentive to do so.
Bureaucratic turf
Treasury guards OFAC because sanctions are Treasury's principal source of foreign policy relevance. Without OFAC, Treasury is a fiscal and monetary policy department with limited influence over national security decisions. With it, Treasury has a seat at the table for every major foreign policy decision involving a state that can be sanctioned, which in practice means almost every state. Commerce guards BIS because export controls are Commerce's claim to national security significance. State guards its coordinating role because without it, State risks becoming a diplomatic service disconnected from the coercive instruments that give diplomacy weight. Each agency has built its institutional identity around the fragment of economic warfare it controls. Consolidation would require them to give up the very thing that makes them matter.
Congressional fragmentation
Congress reinforces the problem through its own committee structure. The Senate Banking Committee claims jurisdiction over financial sanctions. The Senate Foreign Relations Committee claims jurisdiction over foreign policy dimensions. The House Financial Services and House Foreign Affairs Committees maintain parallel claims. When Congress mandates sanctions, as it did through CAATSA in 201727 and the Caesar Act in 2019,28 it does so through whichever committee has the strongest jurisdictional claim, creating statutory authorities shaped by committee turf rather than strategic coherence. CAATSA imposed a 30-day congressional review period on presidential sanctions relief for Russia, effectively removing executive flexibility. The Caesar Act eliminated presidential waiver authority entirely for Syria sanctions. The result is a patchwork of mandatory sanctions that constrain presidential flexibility without providing strategic direction, because the committees that write them are optimizing for jurisdictional control, not campaign design.
Resource expansion without consolidation
The Office of Terrorism and Financial Intelligence, which houses OFAC, received a 58 percent budget increase between 2014 and 2019. Yet vacancy rates across the sanctions workforce ranged from 6 to 26 percent of authorized positions.29 BIS saw its funding roughly double between 2013 and 2024, but the GAO found that workforce planning still fell short of key practices even as workload outpaced hiring.30 Each new sanctions package and each new export control rule expands the mandate without a corresponding mechanism for resource allocation across the fragmented system. Agencies compete for budget increases individually, reinforcing the very siloes that prevent coordination.
The compliance industry serves as a constituency for complexity. The picture is more complicated than rent-seeking by financial institutions, and the distinction matters. Banks themselves bear compliance costs as a tax. They face mandatory screening obligations, OFAC list maintenance, and de-risking incentives that reduce rather than expand their commercial latitude. They would prefer a system with fewer obligations, not more. The rent-seeking layer is not the banks but the compliance industry that has grown up around them: the specialist consulting firms, the RegTech vendors, the law firms with sanctions practices, and the trade associations whose business model depends on regulatory complexity. The global sanctions screening software market was valued at USD 2.05 billion in 2023 and is projected to reach USD 5.92 billion by 2031, a compound annual growth rate of roughly 13 percent.31 Major compliance firms now bill more for sanctions advisory work than the entire OFAC budget. This industry’s revenues scale with volume, jurisdictional overlap, and ambiguity in rules. The claim is not that the industry lobbies for complexity. No factual record supports that, and much of the ambiguity originates with OFAC itself, whose enforcement-led guidance practices and extraterritorial reach generate the interpretive demand the industry serves. The structural effect does not depend on intent. A consolidated economic warfare architecture would reduce the complexity that creates this demand, so the industry’s commercial interest sits with the status quo. The compliance industry is best understood as a beneficiary and structural defender of fragmentation rather than its author, organized through the same bar associations and trade groups whose members staff the agencies and later interpret the rules for fees. Banks are the platform on which this industry operates, but they are not its principal beneficiaries.
Banks as deputized enforcers
Financial institutions now serve as the primary enforcement infrastructure of American sanctions. Banks screen transactions against OFAC lists before execution, report suspicious activity, and maintain compliance programs scaled to their exposure. The consequences of failure are severe: BNP Paribas paid USD 8.97 billion in total settlements across US agencies in 2014 for concealing references to sanctioned parties in nearly 3,900 transactions.32 In a typical year, enforcement is sparse: OFAC announced just 12 actions in 2024, totaling USD 48.8 million.33 But the BNP Paribas precedent means that every screening decision is priced against the tail risk of a multibillion-dollar penalty rather than against the modal enforcement outcome. The result is widespread "de-risking," in which banks terminate or restrict relationships with entire countries and customer categories rather than attempt to distinguish compliant from non-compliant transactions. The UN Office of the High Commissioner for Human Rights has documented how this over-compliance creates "financial exclusion of non-target states," blocking authorized transactions, imposing excessive documentation requirements, and generating delays that function as sanctions on populations that were never intended targets.34
The political economy argument is this: every actor in the system, from Cabinet departments to congressional committees to private compliance firms to the banks that enforce the rules, extracts something from the current arrangement. Consolidation would require some of them to give up authority, jurisdiction, or revenue. Absent a crisis severe enough to override these interests, the incentive structure points toward continued fragmentation with periodic, cosmetic coordination reforms. The State Department's Office of Sanctions Coordination, created, dissolved, and recreated across three administrations, is the institutional embodiment of this cycle.
The strongest objection to this analysis is that the current system works well enough.35 The United States has frozen roughly USD 300 billion in Russian sovereign assets, imposed the most ambitious technology denial regime since the Cold War, and processed thousands of CFIUS reviews and sanctions designations annually. The objection is that fragmentation may even be a feature, not a bug, producing redundancy, bureaucratic competition, and innovation that a centralized system would suppress. The objection deserves engagement rather than dismissal. The response is that fragmentation produces output at scale but is demonstrably failing on outcome.36 The semiconductor case study above shows the pattern clearly. The October 2022 controls were impressive in their ambition but were followed within twelve months by Hua Hong’s corporate restructuring to evade entity-list designation, Nvidia’s redesign of compliant chips that preserved performance characteristics, and a documented surge in chip rerouting through third countries. The April 2025 partial reversal on advanced chip sales to China, executed under industry and allied pressure without a doctrine of when restrictions are tightened or relaxed, illustrates the deeper problem: an architecture that can deploy tools at scale but cannot answer whether the campaign is winning or losing. Output is not outcome. Without a fused intelligence picture, coordinated organizational design, articulated doctrine, and a strategy that selects which campaigns to wage, the current system substitutes activity for effectiveness. The dollar reserve currency’s eighty-year tenure is not evidence of contemporary American economic domain control; it is the institutional residue of a previous strategic settlement. The question this article asks is whether the United States can produce a successor architecture before that residue is exhausted.
The political economy of fragmentation also explains why reform proposals recur without producing reform. Each of the five contributions surveyed in this article proposes a renovation of their floor of the building. Each assumes that demonstrating the problem will generate political will for the solution. But the political economy argument suggests the opposite: the actors who would need to cede authority to enable consolidation understand the problem perfectly well and have chosen fragmentation over subordination. The State Department’s Office of Sanctions Coordination, created, dissolved, and recreated across three administrations, is not a failure of design. It is the institutional embodiment of a system in which coordination is acceptable but consolidation is not.
Toward a Purpose-Built Architecture: A Sequenced Reform Program
What would a purpose-built institutional architecture for American economic warfare look like, and how might it be built without replicating the fragmentation it is meant to fix? The question requires engaging four problems that diagnostic accounts tend to skip: the order in which reforms must proceed, the mechanism by which new institutions absorb rather than add to existing ones, the metrics by which success is measured, and the honest cost in dollars, staff, and political capital. Each is treated in turn.
Sequencing: which layer first
The layered analysis above implies a sequencing argument that contemporary proposals largely ignore. Reform cannot proceed simultaneously across all six layers because the layers are not independent. Intelligence fusion (Layer One) is foundational because every other reform depends on a shared situational picture; without it, organizational consolidation produces coordinated misjudgment. Organizational redesign (Layer Two) must follow rather than precede doctrine, because the institutional form should reflect the operational logic it is built to execute, not the other way around. Doctrine (Layer Three) and strategy (Layer Four) can be developed in parallel through a single sustained effort rather than sequenced against each other, because doctrine without strategic context is mechanism without purpose and strategy without operational doctrine is aspiration without delivery. Human capital (Layer Five) is the longest lead-time investment and must therefore begin first even though its returns arrive last. Affirmative statecraft (Layer Six) is the layer most easily reversible by a hostile administration and should be institutionalized through statutory authorities rather than executive discretion. The sequencing implied is therefore: intelligence fusion and workforce development begin immediately, doctrine and strategy proceed through a Quadrennial Economic Statecraft Review modeled on the Quadrennial Defense Review, organizational redesign follows once doctrine clarifies the operational requirements it must serve, and affirmative statecraft is built through statutory authorities reauthorized on a recurring cycle. Singh’s 2024 Atlantic Council proposal for a Department of Economic Security represents the most fully developed version of the organizational endpoint, but proposes it without the doctrinal scaffolding that would make its mandate executable.
Transition mechanics: avoiding the balkanization trap
The most serious objection to any reform program is that creating new institutions to fix fragmentation simply produces more fragmentation. The objection is correct against most proposals on offer. Adding another office to the National Security Council, another Treasury bureau, or another standing interagency working group adds another seat at the table without subtracting any existing seats. The transition mechanism that addresses this concern is binding consolidation through statutory authority transfer, modeled on the Goldwater-Nichols approach to joint operations.37 Goldwater-Nichols did not add a new combatant command on top of the existing service chiefs. It transferred operational authority from service chiefs to joint combatant commanders, leaving the services responsible for training and equipping but no longer for warfighting command. Zerden and Smith first brought Goldwater-Nichols into the economic statecraft conversation, proposing joint-duty requirements and Defense Department training models across the civilian economic workforce; the mechanism proposed here extends that logic from personnel to authority itself.38 A comparable approach for economic warfare would transfer operational economic statecraft authority from Treasury, Commerce, and State to a single accountable structure, leaving the departments responsible for the instruments and authorities they administer but no longer for the campaign-level direction of those instruments. The mechanism is subtraction, not addition. Three institutional models can deliver this: an Executive Office of the President coordinating body with directive authority and statutory consolidation, a standing economic security fusion center modeled on the National Counterterrorism Center, or a new Department of Economic Security. Each carries distinct policy implications. An Executive Office body is the fastest to establish and sits closest to presidential authority, but White House coordination bodies hold only the authority the incumbent President lends them, and INTECON’s fate shows how quickly that evaporates; for directive authority to survive a change of administration, it must be statutory, which converts the option from an executive action into a legislative project. A fusion center on the NCTC model carries the strongest precedent, since the National Counterterrorism Center was created by the Intelligence Reform and Terrorism Prevention Act of 2004 precisely to fuse analysis and conduct strategic operational planning across agencies that retained their own authorities; its limitation is the balkanization concern in reverse, because without an accompanying transfer of authority it adds a node rather than subtracting seats. A new department is the most complete consolidation and the most expensive, triggering committee jurisdiction battles across Congress, and the Department of Homeland Security experience, in which the 2002 consolidation of twenty-two agencies degraded performance for years before integration matured, illustrates the transition risk to ongoing operations. What unites the three models is that none works unless authority is actually transferred rather than merely shared, and a full institutional design for any of them exceeds the scope of this article; the six-layer analysis supplies the test that any design must pass.
Success metrics
Reform without metrics is performance without accountability. A purpose-built architecture needs explicit success criteria against which both individual campaigns and the architecture as a whole can be measured. At the campaign level, success should be specified in advance of deployment: the conditions under which sanctions are tightened, the conditions under which they are relaxed, the indicators that would signal a campaign has failed, and the off-ramps that allow strategic redirection without political humiliation. Kilcrease’s nine principles of economic pressure provide a usable starting framework. At the architecture level, the metrics are different: time from intelligence signal to policy response, percentage of major campaigns reviewed against ex-ante success criteria, workforce vacancy rates in coordinating bodies, share of affirmative capital deployments tied to strategic priorities. The 2025 National Security Strategy, which for the first time names economic security and financial dominance as explicit objectives, provides the policy authority for setting these metrics. What is missing is the institutional architecture to operate against them.
The honest cost
Reform proposals routinely understate cost. A purpose-built economic warfare architecture is expensive across three dimensions. In dollar terms, intelligence fusion alone would require a sustained investment in the low billions over a decade to build the workforce, analytic platforms, and private-sector partnerships necessary to fuse the data the government already collects. In staff terms, the United States Government would need to recruit and retain several thousand professionals trained across intelligence, finance, technology, and statecraft, in a labor market where comparable private-sector compliance roles pay substantially more. The Bush School at Texas A&M operates the closest existing graduate program; expanding to a network of war-college equivalents at five to seven universities is a realistic timeline of ten to fifteen years. In political terms, the cost is the most expensive of the three. Statutory authority transfers require Congressional action across multiple committees of jurisdiction whose members have invested careers in the existing fragmentation. The 2024 Section 309 episode shows the pattern: a narrowly drawn intelligence consolidation could not survive markup. A comprehensive reform program is a multi-administration project. The allied dimension adds a fourth cost: any architecture worth building must coordinate with G7, NATO, and Indo-Pacific partners whose own institutions are not aligned with American models. The current US-allied frictions on tariff policy, defense burden sharing, and Russia sanctions complicate this coordination materially. None of these costs is a reason not to proceed. They are reasons to be honest about what proceeding requires.
Conclusion
The United States built its economic warfare capacity tool by tool, mandate by mandate, agency by agency, without ever deciding what the institution as a whole was meant to do. This article has argued that the result is a six-layer cascade of institutional failure: an intelligence deficit that prevents fused situational awareness; an organizational fragmentation that produces output without outcome; a doctrinal vacuum that deploys tools without an operational logic; a strategic vacuum that leaves campaigns untethered from a theory of victory; a human capital deficit that produces specialists without professional cadre; and an affirmative statecraft frontier on which capital is deployed without institutional architecture. The six layers are interdependent; reforming any one of them without the others produces the illusion of progress without the substance. The fragmentation persists because it pays, with bureaucratic, congressional, and industry actors all extracting value from a distributed system that no single actor controls. A purpose-built architecture is buildable, but only on a sequenced reform program honest about its costs in dollars, staff, and political capital, and only through the transfer of statutory authority rather than the addition of yet another coordinating body. If the argument here is correct, the United States will continue to deploy economic warfare tools at unprecedented scale until a strategic shock makes the cost of fragmentation visible enough to overcome the political economy of preserving it. The intervening years are the cost of having organized, in the most precise sense of the word, to fail.
Ian O. Lesser, "The Renaissance of Economic Warfare," Policy Paper PP-04/26 (Rabat: Policy Center for the New South, February 2026), 3.↩︎
Edward Fishman, Chokepoints: American Power in the Age of Economic Warfare (New York: Penguin Random House, 2025), 11.↩︎
As of February 2026, OFAC manages sanctions on over 17,000 individuals and entities. See U.S. Department of the Treasury, Office of Foreign Assets Control, "Sanctions Programs and Country Information," https://ofac.treasury.gov/sanctions-programs-and-country-information.↩︎
Government Accountability Office, Economic Sanctions: Treasury and State Could Better Manage Their Sanctions-Related Staffing, GAO-20-324 (Washington, DC: GAO, 2020), 8-12. The report identifies more than ten agencies with substantive sanctions roles beyond Treasury, State, and Commerce. Multiple subsequent assessments have catalogued hundreds of offices sharing economic security authorities across the federal government.↩︎
Henry Farrell and Abraham L. Newman, "Weaponized Interdependence: How Global Economic Networks Shape State Coercion," International Security 44, no. 1 (Summer 2019): 42-79, at 50. The authors identify two conditions for successful weaponization: effective jurisdiction over central economic network nodes, and appropriate domestic institutions and norms.↩︎
The series is published as a partnership between the Potomac Institute for Policy Studies and War on the Rocks, running from January to April 2026. At time of writing, seven of eleven planned articles have appeared.↩︎
Tim Welter and Margaret McWeeney, "Sun Tzu in the Supply Chain: The New Face of Economic War With China," War on the Rocks, February 5, 2026.↩︎
Karyn Eliot and Jennifer Buss, "Fighting an Economic War Without Fused Intelligence," War on the Rocks, March 5, 2026.↩︎
William Norris, "Economic Statecraft and the Federal Institutional Architecture," War on the Rocks, February 2026. Norris directs the Economic Statecraft Program and serves as Associate Professor at the Bush School of Government and Public Service, Texas A&M University.↩︎
U.S. Department of the Treasury, "CFIUS Overview," https://home.treasury.gov/policy-issues/international/the-committee-on-foreign-investment-in-the-united-states-cfius/cfius-overview.↩︎
Government Accountability Office, Export Controls: Commerce Should Improve Workforce Planning to Help Ensure It Meets Its Mission, GAO-25-107431 (Washington, DC: GAO, 2025), 1, 14. Export license applications increased 53 percent and Entity List additions increased 151 percent during the review period, while staffing grew from 403 to 585 positions.↩︎
Atlantic Council, "Modernizing the Tools of Economic Statecraft to Meet the Challenges of Today," Issue Brief (Washington, DC: Atlantic Council, 2025).↩︎
Peter E. Harrell, "America’s New Way of Economic War," Foreign Affairs, March 27, 2026. Harrell served as Special Assistant to the President and Senior Director for International Economics and Competitiveness (2021-2022), jointly appointed to the NSC and the National Economic Council, and previously as Deputy Assistant Secretary for Counter Threat Finance and Sanctions in the State Department’s Bureau of Economic and Business Affairs (2012-2014). He is currently a Visiting Scholar at Georgetown University’s Institute of International Economic Law. Disclosure: Harrell serves on the editorial board of The Ledger.↩︎
Lt Col Mary Hossier, "Why the United States Needs Economic Coercion Doctrine," CNAS Insights (Washington, DC: Center for a New American Security, February 10, 2026).↩︎
See, for example, the "Sanctions Implications" section of U.S. Department of the Treasury, "Economic Fury Targets Iranian Network Defrauding U.S. Firms to Supply Tehran’s Military," press release SB-0515, May 29, 2026, https://home.treasury.gov/news/press-releases/sb0515.↩︎
Daniel W. Drezner, The Sanctions Paradox: Economic Statecraft and International Relations (Cambridge: Cambridge University Press, 1999); and Daniel W. Drezner, "Global Economic Sanctions," Annual Review of Political Science 27 (2024). Drezner shows that explicit articulation of demands and procedures is integral to sanctions credibility.↩︎
Emily Kilcrease, "Hit It with Your Best Shot: An American Doctrine of Economic Pressure" (Washington, DC: Center for a New American Security, April 2026).↩︎
Alex Zerden and Leland Smith, "Operationalizing a Doctrine for U.S. Economic Statecraft," War on the Rocks, April 12, 2024; Navin Girishankar, "America Needs Economic Warriors," Foreign Affairs, December 30, 2025.↩︎
Girishankar, "America Needs Economic Warriors."↩︎
GAO-20-324, 15-18.↩︎
RAND Corporation, "Geoeconomics Summer Study 2026," DARPA-sponsored research program, Washington, DC.↩︎
Zerden and Smith, "Operationalizing a Doctrine for U.S. Economic Statecraft"; H.R. McMaster and Andrew J. Grotto, "Economic Statecraft: The Need for an Integrated Approach," Hoover Institution Essay (Stanford, CA: Hoover Institution, March 2025); Girishankar, "America Needs Economic Warriors." See also Stimson Center, "The Case for Increasing Economic Warfare Capabilities in the Military" (Washington, DC: Stimson Center, 2024), and Potomac Institute for Policy Studies, "Economic Warfare Operations Capability," July 2023.↩︎
Georgie Skipper, "Follow the Money: Finance and the Future of Allied Economic Statecraft," War on the Rocks, March 25, 2026. Skipper is a Fulbright Scholar, former senior advisor to the Australian foreign minister, CEO of the Lucetia Group, and co-founder and affiliate director at MIT’s Murray Lab for Geopolitics and Innovation.↩︎
The White House, "Project Vault: A Public-Private Partnership for a Strategic Minerals Reserve," February 2, 2026. The EXIM loan of USD 10 billion represents the largest financing in the Export-Import Bank’s 92-year history.↩︎
Christopher Clayton, Matteo Maggiori, and Jesse Schreger, "A Framework for Geoeconomics," Econometrica 94, no. 1 (January 2026): 105-136.↩︎
The analysis in this section follows the public choice tradition of sanctions scholarship; see William H. Kaempfer and Anton D. Lowenberg, "The Political Economy of Economic Sanctions," in Handbook of Defense Economics, vol. 2, ed. Todd Sandler and Keith Hartley (Amsterdam: Elsevier, 2007), 867-911.↩︎
Countering America’s Adversaries Through Sanctions Act (CAATSA), Pub. L. 115-44, 131 Stat. 886 (2017). Section 216 imposes a 30-day congressional review period to block presidential sanctions relief for Russia.↩︎
Caesar Syria Civilian Protection Act of 2019, Pub. L. 116-92, Div. J, Title LXXIV (2019).↩︎
U.S. Department of the Treasury, Congressional Budget Justification, FY2023: Office of Terrorism and Financial Intelligence (Washington, DC: Treasury, 2022). TFI, which houses OFAC, received a 58 percent budget increase between 2014 and 2019. GAO-20-324, 15-18, documents vacancy rates of 6 to 26 percent of authorized positions.↩︎
GAO-25-107431, 14. BIS funding roughly doubled between 2013 and 2024, yet the GAO found that workforce planning "falls short of key practices."↩︎
Verified Market Research, "Sanctions Screening Software Market Size and Forecast," 2024.↩︎
U.S. Department of the Treasury, OFAC, "Settlement Agreement: BNP Paribas SA," June 30, 2014. The OFAC settlement was USD 963 million; the total settlement with all U.S. agencies reached USD 8.97 billion for concealing references to sanctioned parties in nearly 3,900 transactions across Sudan, Iran, Cuba, and Burma programs.↩︎
Morrison Foerster, "U.S. Sanctions Enforcement 2024: Lessons Learned," April 2025.↩︎
United Nations Office of the High Commissioner for Human Rights, "Guidance Note on Overcompliance with Unilateral Sanctions and Its Harmful Effects on Human Rights" (Geneva: OHCHR, 2024).↩︎
For the argument that the institutional deficit will eventually catch up with strategic ambition, see Fishman, Chokepoints, 287-289.↩︎
On the mechanics of failure, see Bryan R. Early, Busted Sanctions: Explaining Why Economic Sanctions Fail (Stanford, CA: Stanford University Press, 2015), identifying third-party evasion as the primary mechanism by which sanctions regimes are undermined.↩︎
Goldwater-Nichols Department of Defense Reorganization Act of 1986, Pub. L. 99-433, 100 Stat. 992 (1986).↩︎
Zerden and Smith, "Operationalizing a Doctrine for U.S. Economic Statecraft."↩︎