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Reviewed:
Chokepoints: American Power in the Age of Economic Warfare
by Edward Fishman
Portfolio, 538 pp., $40.00
For decades the term “chokepoints” has referred to places, usually narrow maritime passages, through which a great deal of traffic needs to move: the Panama Canal, the Bosporus, the Strait of Malacca. In the over-quoted words of Sir Walter Raleigh: “Whosoever commands the sea commands the trade; whosoever commands the trade of the world commands the riches of the world, and consequently the world itself.” Despite the technological revolutions of the past centuries, this remains true: over 80 percent of world trade by volume travels by sea, and disruptions such as the Ever Given container ship getting stuck in the Suez Canal—or the blockades of the Strait of Hormuz—still send ripples through the global economy. For a century American naval strategy and geopolitical dominance have relied in part on control over important maritime routes.<br>The central contention of Edward Fishman’s book Chokepoints: American Power in the Age of Economic Warfare is that the era of hyperglobalization has spawned new, more abstract kinds of chokepoints alongside the traditional ones. These bottlenecks appear in the opaque circuitry of finance: the online balance sheets of banks, the transactions of payment systems, and the servers filled with account data. Because a huge share of global finance is either denominated in dollars or runs through US financial institutions, international banks cannot afford to lose access to the American economy. As an extension of its foreign policy, the US can freeze deposits and Treasury bonds held by other nations—as they did to Russia in 2022—or levy penalties on foreign institutions that do business with adversaries.<br>Building on the influential work of the political scientists Henry Farrell and Abraham Newman,* Fishman argues that the chokepoints of what they call an “underground empire” are an almost accidental outcome of the process of American-led globalization. As it set out to connect the world in a post–cold war era, the US ended up with new tools at its disposal, from sanctions to investment bans. US policymakers realized that they had their hands on the spigot of a global system of trade and exchange that ran on the dollar; the power to let it flow could also be the power to seal it off.<br>Fishman’s book, drawn in part from his days working in the State Department and the Treasury, profiles a generation of twenty-first-century American policymakers giddy at the prospect of a new form of warfare without guns. Economic warfare began as a discrete effort to change the behavior of adversaries, but over time it became a means for industrial policy to protect America’s waning competitive edge—from China, in particular. The twist in the story—one it is not entirely clear that Fishman understands, even as he narrates it—is that the project was a failure. It has left the US arguably more isolated and vulnerable than ever.<br>The modern economic arsenal was born amid a shooting war. The World War I–era Trading with the Enemy Act allowed the seizure of German assets in the US, from the Aspirin patent to the Hamburg–America shipping line. Eventually it was used to establish the Office of Foreign Assets Control (OFAC) in 1950, after the “loss” of China to Communist rule. The OFAC worked as an organ of the cold war, enforcing trade embargoes against North Korea, Cuba, and North Vietnam and then, under Reagan, targets like Nicaragua and Libya. As the cold war ended, the focus shifted from high politics to narco-trafficking and terrorism; the Specially Designated Nationals and Blocked Persons List, first published in the 1980s, was aimed at drug networks (it was for a time known as “La Lista Clinton”) and, after the September 11 attacks, suspected terrorists. At this point the United States’ economic weapons were embargoes, which cut off trade with entire countries, and sanction lists, which froze the assets of designated firms and individuals and barred them from doing business with Americans.<br>An essential innovation came in 1996: the creation of “secondary sanctions.” The Iran and Libya Sanctions Act of that year, Fishman writes,
was unique because it aimed America’s sanctions cannon not at Iran directly but rather at foreign companies doing business with Iran, many of which were headquartered in countries that were US allies.
With the net of guilt spread more widely, doing business with nations targeted by the US now meant risking...