In the last 20 years, each presidential administration in the United States has increasingly turned to economic sanctions to respond to a wide range of U.S. national security and foreign policy issues. Prior to his inauguration in January 2021, President Biden anticipated that his administration would use sanctions to further his policy goals. Over the last year, we have seen the Biden Administration do just that, using sanctions to address a variety of threats to the national security, foreign policy, and economy of the United States, including human rights abuses, conduct that undermines democracies, cyberattacks, and struggles between rival powers.

Overall, the Biden Administration has applied sanctions in a measured way that accounts for other concerns, such as humanitarian aid and preserving alliances, while still promptly responding to global events, such as the suppression of democratic dissent in Russia and Cuba, a coup in Myanmar, the diversion of a plane above Belarus, and the rapid loss of law and order in Afghanistan. While certain geopolitical issues with significant sanctions involvement have not yet been addressed by the Biden Administration, such as relations with Cuba and Venezuela, and reentry into the Iran nuclear deal, it appears that progress is being made on those fronts and that future action is likely. And in Russia, the Biden administration continues to signal that "swift and severe" sanctions will be a major part of the international response if Russia further violates Ukraine's sovereignty and territorial integrity.1

I. Treasury 2021 Sanctions Review

In October 2021, the United States Department of the Treasury released the long-awaited The Treasury 2021 Sanctions Review (the "Review"),2 following Secretary of Treasury Janet Yellen's commitment during her confirmation hearing to engage in a comprehensive review of Treasury's use of financial and economic sanctions since the terrorist attacks of September 11, 2001. The Review found that while sanctions are still an effective tool to address various national security and foreign policy objectives, there are four primary challenges to the continued effectiveness of the U.S. sanctions regime: (i) attempts by U.S. adversaries to build payment systems that allow them to avoid the dollar-based financial system; (ii) technological changes, like the growth of digital currencies; (iii) the need to permit the flow of legitimate humanitarian assistance and avoid collateral impact on non-target populations; and (iv) ensuring that sanctions are always deployed alongside other measures as part of an overarching national security strategy.

To this end, the Review included five key recommendations to respond to these challenges and modernize the use of sanctions:

  • Adopt a structured policy framework with a clear policy objective;
  • Improve sanctions coordination and communications with U.S. allies and partners, financial institutions and other actors within the financial system, nonprofit organizations, and the media, whenever possible;
  • Modernize Treasury's sanctions technology, workforce, and infrastructure;
  • Improve access to humanitarian assistance; and
  • Ensure sanctions are easily understood, enforceable, and adaptable.

Although the principles outlined in the Review have been articulated by administrations and observers previously, the Review did provide a framework for how the Biden Administration would seek to evaluate and calibrate the use of sanctions going forward. Indeed, throughout 2021, we saw many of the Review's recommendations reflected in the Biden Administration's use of sanctions; for example, in the publication of General Licenses to ensure that humanitarian aid could continue to flow into Afghanistan after the country's occupation by the Taliban and in the many sanctions actions that were coordinated with U.S. allies, including the imposition of additional sanctions in Belarus and Burma and the ongoing coordination with European allies in response to Russia's aggression into Ukraine. In addition, we have seen the Biden Administration clarify and simplify the Trump Administration's sanctions on Chinese military-industrial companies to specifically target those companies that facilitate or support human rights abuses in China. And the Biden Administration's focus on human rights and penalizing conduct that undermines democracies continues to be reflected in its use of sanctions. What follows is a review of the major policy priorities and sanctions programs during President Biden's first year in office.

Footnotes

1 "Remarks by President Biden and Chancellor Scholz of the Federal Republic of Germany at Press Conference," (Feb. 7, 2022), available here (last visited February 10, 2022).

2 The Treasury 2021 Sanctions Review, available here (last visited February 10, 2022).

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