In October 1935, the Italian dictator Benito Mussolini launched an invasion of Ethiopia, designed to satisfy long-standing Fascist ambitions for a neo-Roman empire of conquest in Africa. Having had ample warning of Italian designs on Africa’s last uncolonized state, officials in the British and French finance ministries had already drawn up elaborate plans to deploy what they called “the economic weapon” against a major European power launching an unprovoked war of aggression. Fearful of the consequences of direct military confrontation, they opted instead for a more clinical approach: cutting off Italy’s ability to purchase crucial imports of food and fuel by blocking its access to credit and refusing to purchase its exports. Under the auspices of the League of Nations, some 52 countries—including, crucially, the Soviet Union under Joseph Stalin—joined an international effort to poleax Italy’s rampaging war economy.

As Ethiopian forces put up heavy resistance to Mussolini’s army, British and French politicians struggled to find new ways to apply economic pressure on Italy, while secretly reconciling themselves to a potential partition of Ethiopia as the price of peace. The most effective economic sanction that might have been deployed, however, lay beyond their reach: The United States, then the world’s largest producer of oil, had declined to join the League of Nations at its inception. When the Senate refused to grant President Franklin Roosevelt the authority to impose an oil embargo on Italy, the writing was on the wall for Ethiopia. Italian forces rolled into Addis Ababa on May 5, 1936, less than a year after the invasion began; the League of Nations’ sanctions were lifted a few weeks later. The first coordinated application by the League of economic sanctions against a major European power had failed utterly.

Or had it? The lesson usually drawn from the League’s failure to check the ambitions of Italy, Japan, and Nazi Germany is that keeping the peace requires greater resolve, and more powerful tools, than Mussolini’s opponents were capable of mustering. As the United States and its allies struggle to respond to Vladimir Putin’s irredentist campaign of conquest in Ukraine, the analogies suggest themselves all too easily. Fascist aggression was not countered forcefully enough by the League of Nations, so NATO and the European Union must now continue to escalate economic sanctions against Russia. Ethiopia was left twisting in the wind as the League worried over the cost of military and financial support to that embattled country and its leader, Haile Selassie; the same hesitation cannot be allowed to cost Vlodymyr Zelensky the war in Ukraine. Rejecting these comparisons means embracing the path of the interwar “appeasers” by failing to take the threat posed by Putin seriously, thereby laying the groundwork for a Western betrayal of Ukrainian freedom.

Nicholas Mulder’s sweeping and intricate history of “the economic weapon”—written before the war in Ukraine and released as it broke out—has the welcome effect of upending the crude historical analogy that underpins this binary of punishment and concession. Its core narrative shows how liberal internationalists in Britain, France, and the United States were beguiled by the illusory promise of sanctions as a means of both preventing and redefining war. Challenging the conventions of international historiography on the origins of World War II, The Economic Weapon argues that sanctions were in fact an all-too-potent weapon in the hands of the League. They were capable of inflicting real material harm on what their advocates called “aggressive and turbulent” peoples—a category that included restive colonized subjects as well as the militaristic regimes of Italy, Germany, and Japan. The threat such sanctions posed all but compelled these powers to turn to autarchy and conquest as means of insuring themselves against the dangers of blockade in a future war with Britain and France. As such, “the economic weapon” was a blunt and uncertain instrument for achieving its stated political goals: the deterrence and, if necessary, the disciplining of military aggression. Interwar internationalists fatally mistook the ability to inflict material deprivation for the capacity to effect political change.

The roots of their confusion lay in a false memory of the grounds for Allied victory in World War I. Throughout that conflict, Britain and France had established an increasingly elaborate system of financial and naval blockades against the Central Powers. This extended to blocking food imports to the civilian populations in Germany, Austria-Hungary, and the Ottoman Empire—in the case of the latter, a devastating famine ensued. When Germany’s forces collapsed on the Western front and Kaiser Wilhelm II was deposed in 1918, the British and French bureaucrats who administered the Allied blockade were quick to claim credit, even as the defeated Germans talked up its cruelty to the civilian population. Yet the armistice was signed, Mulder points out, after Germany had gained a vital accession of territory and raw materials through the Treaty of Brest-Litovsk, signed with Russia’s new Bolshevik leaders following that country’s descent into revolution and civil war. Whatever they might have later claimed when propagating the nationalist and anti-Semitic “stab in the back” myth of Germany’s defeat, it was the German generals, not the civilians, who had first lost their nerve.

Fatefully, however, the attribution of victory to “the economic weapon” resonated in the brittle atmosphere of liberal triumphalism that prevailed between the armistice and the signing of the Treaty of Versailles in 1919. Those who had once been ardent free traders, convinced of the capacity of economic interdependence to act as a solvent for geopolitical tensions, were grateful to find their worldview reaffirmed by the spectacle of a militarist empire laid low by its severance from the arteries of global commerce. Woodrow Wilson, initially a skeptic of blockade, was entranced by what he took to be its success in forcing a democratic German revolution against the generals. Yet, as the guns fell silent on the Western front and Germany’s new democratic government sat down at the negotiating table, the trade embargoes against the Central Powers remained in force. The British Empire, meanwhile, pursued a policy of blockade against Bolshevik Russia, provoking intense domestic protest from socialists and feminists in the “Hands Off Russia” movement, and apparently stiffening the resolve of the Red Army in its wars against White Russian and Polish forces. A precedent was set for what Mulder terms “peacewar”: the adoption of sanctions as a form of coercion that fell short of formally declared hostilities.

The Allies’ continued reliance on the economic weapon to stamp their authority on a chaotic postwar world was key to its establishment at the heart of the system of collective security outlined in the Covenant of the League of Nations. With the idea of giving the League its own armed forces blocked by the British and the Americans, and with a French-sponsored commitment to “mutual support” for states threatened by aggression left dangerously underspecified, economic punishment was left as the only meaningful enforcement mechanism available to the organization. The hope in the League of Nations’ first decade—apparently vindicated by its successful defusing of a series of border crises in southeastern Europe—was that the mere threat of sanctions would be enough to bring recalcitrant states to heel. Yet perennially neutral European states like Switzerland and the Netherlands joined forces with the United States to stymie hopes for the adoption of sanctions and blockades as a universally accepted measure of “public” war against aggression. The 1920s controversy over neutral rights, Mulder suggests, was a locus classicus for articulating the neoliberal aspiration to insulate commerce from politics. The recovery of world trade from the dislocations of the war years demanded its protection from the baneful effects of the economic weapon.

At times—most strikingly in its closing warning against “stitching animosity into the fabric of international affairs”—Mulder’s book seems to hew close to this preference for neutral rights over sanctions as the proper way of reconciling the imperatives of trade and war. His narrative should certainly make us think twice regarding some of our own assumptions about what constitutes a “progressive” position when it comes to the relationship between economic order and world peace. “Blood-thirsty pacifists,” often with left-liberal politics, ruthlessly defended the rectitude of starving civilian populations in the name of peace: The British Labour politician William Arnold-Forster is a recurring example. Meanwhile, arch-reactionaries such as the Nazi jurist Carl Schmitt decried the imperial overreach implied in the League of Nations’ assertion of the right to declare seemingly limitless economic war on those it labeled “aggressors.”

The animating spirit of Mulder’s critique of these excesses of liberal sanctionism, however, is not Schmitt but a more conventional hero for 21st-century progressives: John Maynard Keynes. The British economist’s crisp summation of the drawbacks of economic punishment and deterrence as means of upholding international security was offered in a 1924 memorandum to the League’s own sanctions-skeptical Economic and Financial Organization. “The more things are thought about,” Keynes wrote, “the more shall we be inclined to depend upon positive assistance to the injured party as compared with reprisals against the aggressor…. Positive measures would be much more impressive when the time came than negative acts which would always run the risk (1) of not being efficacious and (2) of not being easily distinguished from acts of war.”

The League powers’ preference for punitive sanctions over an effectively funded and institutionalized mechanism for sending military and financial assistance to states under attack was a function of the austerity and deflation pursued by the capitalist economies in the wake of World War I. Absent a Keynesian commitment to fiscal and monetary expansion, funds were bound to be in short supply. In a further, virtuoso display of historiographical revision, Mulder dismantles the canard that “deglobalization” following the Great Depression of the 1930s limited material interdependence among the European powers and thereby made war more likely. Though the value of world trade collapsed, its volume remained largely constant. This was especially true for the vital raw materials necessary for both war-fighting and civilian morale—the ultimate target of League sanctions like those levied against Italy in 1935–06. It was the repeated weaponization of interdependence in a context of low growth and austerity policies that created the economic preconditions for World War II. The lessons for the present day could hardly be more pertinent—or chilling.

Keynes’s vision of a “positive” economic weapon—one founded on provision, not deprivation—would only be meaningfully realized once the League of Nations and the United States had catastrophically failed to counter Nazi and Japanese aggression. Lend-lease, an American scheme for sending weaponry at little or no cost to those fighting the Nazis, was set up over a year before the United States’ formal entry into the war and continued until victory in 1945. Placing the might of America’s manufacturing capacity at the disposal of those attacked by the Axis powers, lend-lease was marketed to domestic audiences as a way of turning the United States into “the arsenal of democracy.” In practice, however, it continued the League of Nations’ indifference to democratic forms of government: The recipients included nationalist authoritarians like Chiang Kai-shek and Getúlio Vargas, the Saudi monarchy, and (of course) Stalin’s USSR. The wartime alliance against the Axis powers, which was already coming to be known as the “United Nations,” was dedicated to the immediate imperative of collective security against aggression, not the vague and impossible goal of “promoting” democracy.

Mulder’s history gives us an interesting set of coordinates for thinking through what a progressive foreign policy might look like in the 21st century. Today, the combination of generous means and clear ends that defined lend-lease has been all but forgotten. Instead, sanctions designed to punish not just the crime of aggression (as in the case of Russia), but a host of vaguely defined offenses against liberal norms act as just one more source of political instability in a world that does not lack for them. As such, Mulder’s book provides grounds for urging “strategic restraint” in US foreign policy. It also, however, expresses a more idealistic aspiration to marshal collective resources to face common threats. Elsewhere, he has advocated for a “lend-lease” program for climate change as a global policy to complement a domestic Green New Deal, and he has warned that a “new Cold War” with China is driving that country into an ecologically devastating dash for coal as it seeks to insulate itself against a potential loss of US-controlled supplies of oil and gas. In The Economic Weapon, the analogy between the challenges of defeating Nazism and resolving the climate crisis, so beloved of progressives in the 2010s, gains new and surprising scholarly foundations.

Whether or not that analogy holds, however, depends ultimately on the distinction that Mulder, following Keynes, draws throughout the book between the “negative” and “positive” economic weapon. Here, there are reasons for doubt, because generosity as well as deprivation can be experienced as a form of coercion by those subject to it. US economic assistance in World War II was not just about a disinterested defense of collective security; it was also about the promotion of American power. Keynes himself learned this brutal lesson when he arrived in Washington in September 1945 to negotiate what he thought would be a grant or interest-free loan to keep Britain’s war-ravaged economy and overstretched empire afloat following the abrupt termination of lend-lease after the defeat of Japan. Facing financial ruin, the British agreed to cement US financial and military primacy by extending leases on American bases and enabling sterling’s convertibility into dollars. While there’s little reason to mourn the accelerated decline of British power at the hands of the Truman administration, it’s obvious that “positive assistance” could act as a Trojan horse for empire. After some 70 years of US-backed proxy wars and structural adjustment policies across the Global South, it will take more than an appeal to the shade of FDR to shake that impression.

We could also question, moreover, the foundational assumption that Mulder ultimately shares with his book’s protagonists: the naturalness and necessity of global commercial exchange and interdependence, such that its withdrawal or restriction must perforce be understood as a kind of violence, however attenuated. Though The Economic Weapon is focused in the end on questions of statecraft and high politics, it occasionally offers us glimpses of the history of economic sanctions “from below”: the origins of the term “boycott” in the Irish Land War of the 1880s; the half-million-strong League of Nations Union that championed British sanctions against Mussolini during the Ethiopian War. To these examples we might also add the sanctions campaigns against Rhodesia in the 1960s and South Africa in the 1980s, which find their echo in today’s Boycott, Divestment, and Sanctions movement against Israel. All of these movements had or have clear accounts of the concrete political outcomes they seek to achieve. Yet they also are motivated by a larger ethical understanding of commerce, under which material exchange is not a mere necessity but a positive moral choice.

From this perspective, continuing to produce goods for—or to consume goods from—those we find morally objectionable is a way of condoning their behavior. It compromises our own moral integrity by offering what (in Mulder’s terms) amounts to “positive assistance” to an aggressor. The world appears not as a political economy, shaped by the tensions and interactions between a global market and an international system of nation-states, but as a moral economy, in which production, consumption, and exchange are regulated by what are claimed to be universal norms and obligations, binding on individuals. The hope of changing political behavior, I suspect, is only part of the reason civil society campaigns of boycott gain adherents. They are also about ideas of cleanliness and moral hygiene: avoiding the taint of the settler-grown dates, the slave-picked cotton. However much we might sometimes wish that this unruly moral energy could be reliably harnessed—or contained—by hard-headed economic statecraft, it is difficult to see how a popular internationalist politics could ever dispense with it. As long as we care about what happens elsewhere in the world, we will continue to express our moral judgments through our economic behavior—and to demand, moreover, that our governments use their awesome and unwieldy power to advance our convictions. Even the most prudent historical counsel is unlikely to silence the old siren call: “Let justice reign, though the heavens may fall.”