Conflict theorists have recently argued that a high level of income inequality is a structural condition which increases the threat to the privileged position of economic elites as well as their ability to influence government social control. We draw from this argument, along with theory and research on political conflict, to develop a simultaneous equation model of sanctioning by national governments. The model is tested using the most recent cross-national data now available. We find no evidence of an independent effect of income inequality on sanctions or vice versa. However, we do find that politically exclusive governments tend to impose sanctions more frequently, relative to the level of political opposition, than more “democratic” governments. The implications of the findings for the threat hypothesis are discussed, with emphasis placed on the possibility that economic inequality may indirectly influence acts of government repression through its exacerbating effect on political exclusion.