New U.S. Policy Toward Iran: Right Questions, Wrong Solution

By: Amirmohammad Soori

May 8, 2019

Iran-U.S. relations have reached their worst condition in decades, and the key question is whether the United States has achieved its goals, or if this new strategy can be useful? This new strategy of “maximum pressure and negotiation” has very clear elements that the United States has tried to implement, but the result and future remains obscure.

President Donald Trump got the United States out of the Iran nuclear agreement, formally known as the Joint Comprehensive Plan of Action (JCPOA), and imposed tougher sanctions on Iran. Recently, the administration officially designated Iran's Islamic Revolutionary Guard Corps as a “Foreign Terrorist Organization,” a move some in the administration had opposed over concerns about potential risks to U.S. troops in the Middle East. In addition, the White House announced it would end all sanction exemptions for countries that import Iranian crude oil. 

Trump says the Iran deal is defective at its core. A new one will require real commitments. He outlined four main concerns to address when countering Iran, which included the JCPOA’s short-term concerns, its ballistic missile program, and its regional activities in places such as Syria. It seems that Trump has some valid questions about the previous deal with Iran, but his current policy will not produce useful results. 

In the short term, the White House has had some achievements, but in the long term, the result may backfire because of the complicated situation in the Middle East, Iran’s ability to manage crises, and the lack of appropriate alternatives for the Islamic Republic. 

The Short Life of JCPOA

A few days after JCPOA’s start, Iran test-fired two ballistic missiles with the phrase "Israel must be wiped out" written on them. Also, the intensification of Iran's regional activities has led the United States to conclude that Iran is failing to fulfill the "spirit" of its landmark nuclear deal with world powers. In practice, the United States has kept some other sanctions against Iran and stated that those sanctions did not relate to Iran's nuclear issues. Those remaining sanctions did not allow Iran to fully exploit the benefits of JCPOA. 

Hassan Rouhani, the Iranian president, realized that the nuclear deal alone was not enough. Meetings with U.S. Secretary of State John Kerry, as well as the process of nuclear talks, has led Rouhani to conclude that Iran has to talk about regional issues and missile issues for a proper agreement with the West. This is why Rouhani proposed the second and third JCPOA; though the proposal was partly inspired by internal coherence and internal economic issues, another part addressed continuation of negotiations with the United States and EU countries. Such a proposal was faced with a sharp reaction by Ayatollah Ali Khamenei. In a lecture in Mashhad, Khamenei strongly opposed more negotiations with the United States and stated that Iran cannot trust them. Then, he blocked any kind of negotiation. 

Although European companies could enter Iran's market after the JCPOA, American companies could not or did not want to enter Iran because of other U.S. government sanctions. In a dialogue with French President Emmanuel Macron, Trump noted that France and the EU countries have made significant investments in Iran and they are making more money. Even after this critique, Bijan Zanganeh, the Iranian oil minister, invited the United States to invest in the Iranian oil industry as well. These debates show that the United States felt that it could not use the JCPOA properly.

Once the JCPOA started to work, there were huge disagreements and problems. Trump’s year-long pressure to correct this agreement faced Iran's opposition and Europe's inability to proceed. As a result, he decided to start a new era where the United States is the main actor, but it is unclear if Trump can finish this new game. 

Political Gamble

It cannot be denied that the United States has somewhat achieved its goals. Limitation of Hezbollah's financial sources and the internal economic problems of Iran are due to the effects of U.S. sanctions. Secretary of State Mike Pompeo and Trump seem quite satisfied. For this reason, they are increasing sanctions almost every month.

Although Iran's oil exports have decreased by half, reaching about 1.2 million barrels per day, the United States still seeks to eliminate oil exports from this market. Although political reasons are evident in this decision, economic decision-making is important, too. In fact, sanctions on Iran, Venezuela, or even Russia can be useful for U.S. oil companies to enter the market. With South Korea now uncertain about the longevity of its Iranian oil purchase waiver, it has begun testing super-light U.S. oil sold by Anadarko Petroleum Corp as a substitute for Iranian crude while it awaits word from Washington on whether it can keep buying oil from the Middle Eastern nation.

In spite of these achievements, the U.S. strategy seems to be precarious with respect to Iran. After over 40 years of sanctions, Iran has learned how to manage pressure. The White House mentioned that oil exports from Iran should be zero, but it seems likely that Iran will export about 500,000 barrels of oil in 2019, thanks to smuggling and the U.S.-granted temporary waiver.

If Iran's oil exports are reduced to zero, it could be dangerous for Persian Gulf security. The second concern is the very fragile situation of the oil market. Iran and Venezuela are major oil-exporting countries, and the disappearance of these two countries’ oil markets could have a serious negative short-term effects. Also, it is right that exports of about only 500,000 barrels will lead to a reduction in government revenue, but a complete economic collapse seems unlikely. Of course, the possibility of secret exchanges with Iraq, Russia, and China cannot be discounted and is perhaps even likely.

When examining the effect of sanctions on regional activities, the claims raised are exaggerated. When the Obama administration negotiated the nuclear deal, President Barack Obama acknowledged that sanctions relief for Tehran would inevitably mean more money for groups like Hezbollah. But he also insisted it wouldn’t make much of a difference in terms of Iran’s capacity to make mischief in the Middle East. “Iran is feeling a financial pinch, but there is no evidence the pinch has affected Tehran’s ability or willingness to act as it does in the Middle East,” says Paul Pillar, a former CIA officer who’s now a professor at Georgetown University. “Iran does what it does in the Middle East not according to how much money it has, but instead according to what it sees as in its own security interests.”

Iran decided to reform its budget structure and has understood throughout its history that it should not be so dependent on oil. Some officials say that sanctions could be an opportunity for Iran. There will be no other way to prevent the worsening of the economic situation in Iran than structural reforms and prevention of corruption. 

The most desirable situation for the United States is the start of political turmoil as a result of the deteriorating economic situation in Iran. The January and February 2018 demonstrations were probably an incentive for Trump to set massive economic sanctions to encourage political turmoil in Iran. But despite the fact that Iran had a bad year last year, there has been no serious political and economic turmoil in Iran. 

Although the Iranian people may have a severe opinion of political rulers, it is beyond ridiculous to imagine John Bolton (Trump's shrewd national security adviser) and Maryam Rajavi (leader of MEK) in Tehran's Freedom Square. In fact, the reimposition of U.S. sanctions on Tehran will further unite the Iranian nation against the foreign threat. The Iranian reformist Hajarian said that because of the lack of leadership for economic problems, this kind of demonstration seen in 2018 cannot be successful. On the other hand, as many analysts state, the main problem of the Iranian economy is not Trump in the United States. The problem is the Iranian Trumps, who are ruining the country with ignorance or betrayal. 

Trump has turned into a high-rolling gambler. If his hunches are wrong, the losses could include a trade clash between the United States and Europe, a surge in Iranian-backed violence and terrorism, and grave damage to the decades-long cause of nuclear non-proliferation. That would be a bet without winners.

What Should We Do?

Former U.S. diplomat Nicolas Burns believes these sanctions certainly will be effective, but does not believe that they will lead to fundamental change or surrender of the Iranian government. In fact, he believes that maximum pressure cannot work with Iran. On the other hand, the United States Special Representative for Iran Brian Hook raised the question: Isn’t it time to abandon the policies that have kept the people of Iran and the United States apart since 1979?

Although negotiation is the best option, negotiation seems almost impossible with the situation the United States has shaped. Hassan Rouhani stated that Trump has repeatedly sent him requests for negotiation through European intermediaries that he did not accept. He has also said that Trump must first return to the negotiation table and only then can negotiation take place. While going back to the negotiation table is the best option possible, it will only be effective if it is real negotiation, not just handshaking in front of a camera. 

But how can negotiation conditions be realistic? It is unlikely that the United States and Iran will dramatically change their stance, but perhaps only a few modifications in the policies of the two sides would prove useful. For example, limiting certain aspects of sanctions and the use of more favorable words by the United States would be very helpful in gaining the trust of the Iranian side. In addition, Iran could stop reciting “Death to America.” Of course, Iran must share this vision. The constant emphasis by political leaders that we are only negotiating about nuclear issues is not true or realistic in the political world. Politics has a variety of dimensions, and each negotiation must take into account all aspects of the subject.

Another very serious issue is the question of normalizing Iran's policies. The problem that Trump tries to fix through sanctions is the fall of the Islamic Republic. This idea is not realistic in Iran. Iranian intellectuals agree that democracy and freedom are desirable, but these will not be achieved through the end of the Islamic Republic, which will only complicate the political situation. Change will only occur via Iran’s people and its intellectuals in particular.

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New U.S. Policy Toward Iran: Right Questions, Wrong Solution