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The uses and abuses of weaponized interdependence in 2021

Some thoughts about economic statecraft over the next year or so

President Biden holds a semiconductor chip last week before signing an executive order aimed at addressing a global semiconductor chip shortage. (Jonathan Ernst/Reuters)

In 2019 Henry Farrell and Abraham Newman published an article titled “Weaponized Interdependence: How Global Economic Networks Shape State Coercion.” The hard-working staff here at Spoiler Alerts were pretty big fans of the paper. Farrell and Newman were not the first to observe that states could exploit interdependence to engage in economic statecraft. That is a tale as old as Albert Hirschman. What was novel about Farrell and Newman’s work was the application of network theory to explain how coercing actors could exploit interdependence and why targeted actors would find it difficult to evade coercion attempts.

The highest compliment I can pay Farrell and Newman is this: I have worked on questions of economic statecraft for more than 20 years and was absolutely furious that they had observed bits and pieces of this idea floating in the scholarly ether, thought about it rigorously, and made it so darn clear and compelling for everyone else.

Rather than pout in a corner, however, I did the smart thing and joined forces with Farrell and Newman! The result is an edited volume, “The Uses and Abuses of Weaponized Interdependence,” that Brookings Institution Press has published today. It features Farrell and Newman’s original article as well as 16 additional chapters from an array of scholars in different disciplines, extending and reacting to their argument.

You will have to read the whole thing to get the differing perspectives on the phenomenon. Here are a few of mine for readers — and the Biden administration — to chew over.

1) Yeah, there’s going to be more economic coercion in the coming years. I argued in “The Sanctions Paradox” that states would have more success coercing allies than adversaries but would be understandably reluctant to pressure international partners. If Farrell and Newman are correct about the potency of economic networks, great powers will be more willing to exploit weaponized interdependence to threaten allies. The inability of allies to evade such networks means that the costs of doing so for the coercer are minimized.

2) More coercion will not necessarily have any greater likelihood of success. There will be more coercion, but it is far from clear that this will yield successful statecraft. In theory, it is possible that allies will be willing to acquiesce more. In practice, the Trump administration’s record in this regard was not encouraging.

This is mostly because when great powers discover a new form of coercion, they like to overuse that tool, negating its effectiveness. Furthermore, states are much more eager to coerce rivals. So far, weaponized interdependence has mostly encouraged great powers to try to coerce other great powers — a gambit that is likely to accomplish little regardless of the economic costs.

3) The term “weaponized interdependence” will be abused. As I noted in the introduction to this volume: “There is a clear danger of conceptual stretching. If one were to judge the phenomenon based solely on public commentary, anything and everything has been weaponized. It is all too easy for analysts to deploy the term to describe situations that have little to do with [weaponized interdependence] but use the label to attract attention and inflate threats.”

In other words: Be very, very wary when someone based in a D.C. think tank claims that another country is engaged in this activity. Simply quoting the term does not necessarily make it so.

4) The United States will need to up its statecraft game. To the extent that weaponized interdependence has existed, the United States has been the hegemonic coercer. Paradoxically, the reason this concept is attracting attention in Washington is because of the recognition that other countries *COUGH* China *COUGH* might possess the capabilities to play this game. This means the United States will have to start playing defense as much as offense. The Biden administration and its boosters seem super-keen on this notion.

To be blunt, the United States is out of practice in dealing with peer competitors, and the first steps we have seen in this area are, um, not great. Read Sarah Bauerle Danzman’s chapter in the book to understand why existing mechanisms like the Committee on Foreign Investment in the United States (CFIUS) process might not work as well as intended. Or read this Twitter thread by Newman to see how U.S. actions to limit weaponized interdependence can lead to unanticipated blowback that hurts one’s own country as much as the intended target — a point Farrell and Newman have stressed repeatedly.

So there is a lot going on. Check out the book. The highest compliment I can pay the contributors is that co-editing this book was easy — a word one never associates with edited volumes!