Economic Sanctions

The Trading with the Enemy Act of October 6, 1917, gave the President power to restrict trade with enemy nations during war, and the Treasury created the Office of Foreign Assets Control in December 1950, when China entered the Korean War, to freeze Chinese and North Korean assets. The International Emergency Economic Powers Act of 1977 now provides the main authority: after declaring a national emergency over a foreign threat, the President may block property and prohibit transactions. Congress has also imposed sanctions by statute on countries such as Iran, North Korea, and Russia.

Sanctions range from comprehensive embargoes on countries like Cuba and Iran to targeted measures against specific people and companies, who are placed on the Specially Designated Nationals list, freezing their U.S. assets and barring Americans from dealing with them. Because of the dollar's central role in global finance, secondary sanctions can threaten foreign banks and companies that do business with sanctioned parties. The Magnitsky Act of 2012 and the Global Magnitsky Act of 2016 authorize sanctions for human rights abuses and corruption, and the Commerce Department's export controls work alongside Treasury's programs.

Sanctions have become one of the most heavily used tools of foreign policy, with thousands of designations across dozens of programs, including the sweeping measures against Russia after its full-scale invasion of Ukraine in 2022. In 2025 the administration lifted most sanctions on Syria, sanctioned officials of the International Criminal Court, and in October imposed sanctions on Russia's two largest oil companies. Supporters say sanctions let the United States punish adversaries and change behavior without military force, while critics say broad sanctions often hurt civilians, rarely change regimes, and push other countries to build alternatives to the dollar.