How America became the world’s Leviathan

The US is discovering its unique power in international politics: its unparalleled authority over key nodes of the world economy through which global communications, finance and technology move.

 
In the aftermath of Hamas’ attack on Israel, one immediate focus of many American leaders was a seemingly extraneous issue: the status of Iranian oil revenues in South Korean banks. After withdrawing from the Iran nuclear deal in 2018, President Donald Trump re-imposed so-called ‘secondary sanctions’, targeting non-US entities that transact with specific Iranian sectors. Running afoul of US sanctions poses an existential risk to financial institutions – continued access to dollars is an imperative – so the funds were stuck in place. In September, the US had reached a deal to issue a waiver for the funds, allowing them to be released for the purchase of humanitarian goods in exchange for the liberation of several American hostages, but, citing Tehran’s support for Hamas on 10 October, Deputy Treasury Secretary Wally Adeyemo said the money would now not be ‘going anywhere anytime soon’. Underneath this policy debate was a raw demonstration of how the US had the capacity, at a moment’s notice, to decide whether to permit or suspend international commerce with which it had ostensibly no connection.

 
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