U.S. Pres. Joe Biden said on his recent trip to Warsaw that the sanctions his government is imposing against Russia have the “power to
inflict damage that rivals military might.” He called this a “new kind of economic statecraft.” The sanctions aren’t exactly new, even if the
degree to which they are being used is. The Deutch Commission on the proliferation of weapons of mass destruction said as early as
July 1999 that not only trade sanctions, but also access to U.S. capital markets and U.S. technologies, financial assistance, and influence in
international financial organizations are among the wide range of economic levers available. This “economic warfare” needs to be treated with the same level of sophistication and planning as military options, the Commission said. Czechs who are disappointed that
there won’t be a U.S. military base in their country can seek shelter under the powerful U.S. financial umbrella by supporting the dollar. Its position as the world’s leading reserve currency will fluctuate according to how the war progresses, but a victory for Ukraine will
also be a victory for the dollar and for Biden’s economic statecraft.

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