Sometime this month, various branches of the government will orchestrate a series of measures to further isolate Iran economically. President Obama is pushing for a fourth round of international sanctions against Iran at the UN Security Council, resulting in what is widely expected to be a series of targeted measures aimed at Iran’s nuclear program and its sponsors in the Iranian Revolutionary Guard Corps (IRGC), and it’s likely that the Security Council will act by June. In Congress a bill aimed at cutting off Iran’s imports of gasoline and refined petroleum products is expected to land on the president’s desk by the end of May. And at the Treasury Department officials are reportedly planning another round of unilateral American sanctions targeting Iran’s financial sector, including both its private banks and even Bank Markazi, the Iranian central bank.
Behind all these actions—which will, in fact, inflict real suffering on ordinary Iranians—is a dirty little secret, however: virtually no one, including the proponents of sanctions, thinks they can work as intended, namely, to compel Iran to change its policy, suspend its uranium enrichment program and accept stricter oversight by the International Atomic Energy Agency (IAEA).
Inside the Obama administration, it’s widely recognized that no combination of economic sanctions is likely to succeed. In Congress, even the most hawkish backers of the gasoline sanctions bill expect that it will fail. "Even crushing sanctions might not do the job," says Representative Ed Royce, a California Republican who is a chief sponsor of the measure. Around Washington, in think tanks and in interviews with Iran experts, it’s taken for granted that sanctions as a tool aren’t effective. "Most Iran analysts are skeptical that economic pressure will produce the desired results," says Suzanne Maloney of the Brookings Institution. Even a senior Israeli diplomat, who strongly supports sanctions and spoke on condition of anonymity, told The Nation that the world simply isn’t ready to impose the sort of extreme economic measures that just might force Iran’s hand. "The determination of Iran to continue its process seems to me to be more than the determination of the international community to stop it," he said.
Even if they don’t achieve the desired goal, that doesn’t mean sanctions won’t have any effect. Sanctions are guaranteed to strengthen the hand of hawks and hardliners, including President Mahmoud Ahmadinejad, who will be able to blame various Great Satans for Iran’s woes. A tighter economic noose will enrich the sanctions-busting smugglers in the IRGC. The additional sanctions will put the United States and Iran back on a path of confrontation, reversing or undoing much of the progress that was achieved by Obama’s outreach to Tehran in 2009. And, worst of all, as it becomes clear over time that the new sanctions have failed to compel Iran to halt its nuclear program, that failure will underline the arguments of hawks in the United States and Israel who say that it’s time for military action against Iran.
The administration’s decision to adopt sanctions—the so-called "pressure track"—is a signal that President Obama has run out of ideas about how to handle Iran.
His effort began with great promise. In 2009 Obama reached out to Iran in his inaugural address; in a taped greeting on Iran’s New Year; in two letters to Ali Khamenei, Iran’s Supreme Leader; and in his June 4 Cairo speech about rebuilding relations with the Muslim world. In so doing, Obama inspired many supporters of the reformist opposition in Iran in advance of the disputed presidential election on June 12. Obama’s opening also led to a series of diplomatic exchanges that culminated in a deal, last October, in which Iran promised to send the bulk of its enriched uranium to Russia and France, where it was to have been reprocessed for civilian-use fuel rods. But that deal fell apart. Inside Iran it fell victim to the poisonous post–June 12 political atmosphere. And in the United States Republican hardliners, neoconservatives and allies of the American Israel Public Affairs Committee (AIPAC) made it difficult for Obama to sweeten the deal in order to coax Iran back to the bargaining table.
The administration deserves plaudits for its constructive approach to Iran last year. But, under pressure from Israel’s Benjamin Netanyahu and from hawks and AIPAC at home, Obama foolishly declared last spring that if the talks with Iran didn’t succeed by the end of 2009, he’d rally world powers to pressure Iran, and Secretary of State Clinton began talking about "crippling sanctions." But nearly all experts on Iran, from left to right, knew that it was exceedingly unlikely that talks could succeed quickly. To no one’s surprise, they stalemated. And Obama began pushing Russia, China and other reluctant countries, such as Brazil, India and Turkey, to climb aboard the sanctions bandwagon, with varying degrees of success. Yet even as Moscow and Beijing wearily moved to support another round of anti-Iran steps at the Security Council, they made it clear that the harsher penalties sought by Washington wouldn’t fly.
And then what? According to insiders, the administration is playing it by ear, hoping for the best—and there’s no evidence that it has a strategy going forward.
Can diplomacy get back on track? Some suggest that even though talks on the nuclear issue probably aren’t going anywhere, it might be more productive to start talking to Iran about Afghanistan, Iraq and drug trafficking. Last fall John Limbert, a former US diplomat who was one of those held hostage in 1979–81 after the US Embassy in Tehran was seized, and who was recently appointed as the State Department’s top Iran officer, said, "If we have negotiations where the only thing we care about is the nuclear issue, we will fail." Trita Parsi, president of the National Iranian American Council, urges Obama to avoid setting arbitrary deadlines on talks and to consider reopening last October’s accord for modifications.
But just as Iran’s negotiators are operating under severe domestic political constraints, so too is Obama. Most worrisome is the anti-Iran legislation working its way through Congress—the Comprehensive Iran Sanctions, Accountability and Divestment Act, backed by Representative Howard Berman, the California Democrat who chairs the House Committee on Foreign Affairs, and Senator Chris Dodd, chair of the Senate Banking Committee. The bill, AIPAC’s top priority since it was introduced, requires the administration to examine any and all contracts between Iran and foreign suppliers of gasoline and refined petroleum products. Any that exceed a tiny threshold—just $200,000—trigger a US crackdown, and the president is required to place the offending company on a blacklist. He must then take strong action against the company, up to and including seizing its US assets. The bill, in slightly different versions, passed the Senate and House with overwhelming, veto-proof majorities.
The bill ties the president’s hands by making many of its measures mandatory, so the administration is seeking to modify it by expanding White House leeway to waive or postpone penalties. The administration has not condemned the bill outright, however, and it appears to be sending mixed messages to Congress. One top White House official, Dennis Ross—a close ally of the Israel lobby and a fierce supporter of sanctions and military bluster vis-à-vis Iran who most recently worked at the Washington Institute for Near East Policy, an AIPAC spinoff—has reportedly told some in Congress to move the bill forward [see Dreyfuss, "Dennis Ross’s Iran Plan," April 27, 2009].
Even that bill, in its harshest version, will only lead Iran to evade sanctions by smuggling and by dealing with sanctions-evading firms in China, the United Arab Emirates and elsewhere. The IRGC, which already operates a vast smuggling network, will gain. Meanwhile, the Security Council sanctions, certain to be watered down by Russian and Chinese foot-dragging, will have only symbolic impact. Most punishing for Iran will be the unilateral measures by the United States and its allies, coordinated by the Treasury Department’s under secretary for terrorism and financial intelligence, Stuart Levey—measures referred to inside the State Department as "Stuart Levey’s jihad"—which target foreign investment and financial transactions between Iran and Western companies, including banks.
For the hawks, the hope is that sanctions are merely a way station for an eventual military showdown between Iran and the United States, though the chances that either the United States or Israel will bomb Iran are close to zero. For other supporters of sanctions, the idea is that causing further economic pain for Iran’s population will inspire Iranians to revolt, perhaps re-igniting the stalled Green Movement, which formed before last summer’s election. But that’s unlikely—the government, increasingly relying on the IRGC, the paramilitary basijis and the intelligence service, has shown that it is ready to suppress dissent ruthlessly. As for the Obama administration, which hasn’t entirely given up on diplomacy but apparently has no idea how to revive it, its support for the sanctions push seems to be a fingers-crossed effort to placate the hawks, the Republicans and AIPAC while buying time in the hope that something, anything, will allow diplomacy to resume.
But sanctions, pressure and confrontation are risky. To regain the high ground, President Obama must once again emphasize his readiness to talk with Iran on any and all issues. To calm the waters at home, he should take pains to emphasize that the problem with Iran is not an immediate crisis—that Iran does not have a bomb; that it is at least several years from acquiring one, even if that’s what it intends to do; and that even if it does plan to acquire a bomb, Iran has developed neither a warhead nor a missile that can deliver such a weapon. Obama should explore creative ways to revive the deal that was signed last October, perhaps via intermediaries like Turkey; indeed, during the early May UN conference on nuclear nonproliferation, Ahmadinejad reiterated Iran’s acceptance of the deal, and both Turkey and Brazil are offering to mediate a renewal of the October accord. In addition, Obama should signal that ultimately he is prepared to accept Iran’s right to enrich uranium, under appropriate IAEA safeguards. (So far, Obama has said that Iran has the right to peaceful use of nuclear energy, but he has never acknowledged its right to enrichment as a signatory of the Nuclear Non-Proliferation Treaty.) And he’ll have to rally US allies, along with Russia and China, for a long and frustrating diplomatic adventure, with more false starts and roadblocks to come.