Last week, Maj. Gen. Ataollah Salehi, the commander of Iran’s armed forces, warned an American aircraft carrier, the USS John C. Stennis, not to enter the strategic Strait of Hormuz.
The threat followed those made since the end of last month by various Iranian military and civilian officials attempting to prevent the imposition of sanctions by the United States. “If sanctions are adopted against Iranian oil,” Iranian vice president Mohammad Reza Rahimi said on Dec. 27, “not a drop of oil will pass through the Strait of Hormuz.”
Despite the warnings, President Obama on the last day of 2011 went ahead and signed legislation imposing penalties on foreign financial institutions having dealings with Bank Markazi Jomhouri Islami Iran, Iran’s central bank. The sanctions are generally intended to prevent Iran from purchasing or selling “petroleum or petroleum products.” Moreover, the European Union this week agreed in principle to a full boycott of Iranian oil purchases. And the U.N. Security Council, since December 2006, has imposed four sets of sanctions on the Islamic Republic of Iran.
All these coercive measures seek to persuade Tehran to cooperate with the International Atomic Energy Agency, the U.N.’s nuclear watchdog. Among other things, the IAEA issued a damning report last May detailing evidence that Tehran was working on a nuclear weapon in violation of its commitments under the Nuclear Nonproliferation Treaty to limit its nuclear program to peaceful purposes.
Every dollar Iran earns from its energy exports helps it enrich uranium for a warhead. Many analysts, however, believe sanctions won’t stop Tehran. Tehran, we are told, will find ways to route transactions around Bank Markazi, less scrupulous buyers will stand in for those deterred by the new measures, and the price of oil will skyrocket and thereby put even more money in Iran’s treasury.
More fundamentally, some believe Tehran’s theocratic regime cannot be dissuaded from pursuing nuclear weapons, even if sanctions are successful, because it is determined to build the bomb. Maj. Gen. Hassan Firouzabadi was quoted by state-run Press TV on Tuesday as saying “the Iranian nation cannot be threatened.”
On the contrary, general — it can. “Let’s remember that Iranian actions are not to deter military attack,” said Charles Krauthammer on the Fox News Channel last Friday. “Iranian actions are to deter sanctions.” The reason why Iranian officials took the extraordinary step of risking war with the U.S. by threatening to close the Strait of Hormuz — through which a third of the world’s sea-borne oil passes — is that they know tough sanctions could eventually bring about the end of their unpopular regime.
And it is not just the measure regarding petroleum sales that worries Tehran’s ayatollahs. The recently enacted American sanctions law designates the “financial sector of Iran, including the Central Bank of Iran” a “primary money laundering concern.” This seemingly arcane provision packs a potent punch, as it will essentially prevent Iran’s banks from conducting transactions in dollars.
To understand why this is such a frightening prospect, it’s necessary to recall George W. Bush’s dealings with North Korea. In September 2005, his administration, in order to put pressure on Pyongyang, declared Banco Delta Asia a primary money-laundering concern. The tactic worked so well against the Macau-based financial institution, which North Korea employed to handle external financial dealings, that the country was completely cut off from the global financial system. Pyongyang then had no way to transfer cash except by using its diplomats as mules, who for months were ferrying across the globe large-denomination American currency in bulging suitcases.
North Korea, not surprisingly, decided to return to the then-stalled six-party denuclearization talks. Unfortunately, under pressure from Beijing, Washington lifted the designation in 2007 and returned $25 million in frozen cash prematurely, before Pyongyang actually disarmed itself. Nonetheless, Washington developed a strategy to bend the will of the otherwise intransigent North Korean regime.
The Iranians watched this drama play out and know what the new American sanctions legislation can do to them. That is why President Obama, with smart strategy, can disarm Iran without using force.
And how would he do that? First, he needs to avoid the lure of talking too soon to the Iranians, even though they may be as little as a year away from being able to build a crude nuclear weapon, as Defense Secretary Leon Panetta said last month to CBS News. On the last day of December, just as Obama was signing the bill containing the new sanctions, an Iranian news agency reported that Alireza Sheikh Atta, Iran’s ambassador to Germany, announced that his government expected a new round of talks with the so-called 5+1 Group, the five permanent members of the Security Council plus Germany.
For the better part of a decade, Tehran has been engaged in fruitless discussions with the international community about its nuclear program, essentially stalling as its technicians in underground bunkers developed nukes and improved the country’s long-range missiles. The Iranian government needs to feel pain first before it will engage other nations in good faith.
Soon, with all its banks cut off from dollar transactions, it will for the first time have reason to come to terms. Financial sanctions are by no means risk-free — the Iranian military could still lash out in the Strait of Hormuz or elsewhere — but these measures are the best of a set of horrible options the international community now possesses.
The threat followed those made since the end of last month by various Iranian military and civilian officials attempting to prevent the imposition of sanctions by the United States. “If sanctions are adopted against Iranian oil,” Iranian vice president Mohammad Reza Rahimi said on Dec. 27, “not a drop of oil will pass through the Strait of Hormuz.”
Despite the warnings, President Obama on the last day of 2011 went ahead and signed legislation imposing penalties on foreign financial institutions having dealings with Bank Markazi Jomhouri Islami Iran, Iran’s central bank. The sanctions are generally intended to prevent Iran from purchasing or selling “petroleum or petroleum products.” Moreover, the European Union this week agreed in principle to a full boycott of Iranian oil purchases. And the U.N. Security Council, since December 2006, has imposed four sets of sanctions on the Islamic Republic of Iran.
All these coercive measures seek to persuade Tehran to cooperate with the International Atomic Energy Agency, the U.N.’s nuclear watchdog. Among other things, the IAEA issued a damning report last May detailing evidence that Tehran was working on a nuclear weapon in violation of its commitments under the Nuclear Nonproliferation Treaty to limit its nuclear program to peaceful purposes.
Every dollar Iran earns from its energy exports helps it enrich uranium for a warhead. Many analysts, however, believe sanctions won’t stop Tehran. Tehran, we are told, will find ways to route transactions around Bank Markazi, less scrupulous buyers will stand in for those deterred by the new measures, and the price of oil will skyrocket and thereby put even more money in Iran’s treasury.
More fundamentally, some believe Tehran’s theocratic regime cannot be dissuaded from pursuing nuclear weapons, even if sanctions are successful, because it is determined to build the bomb. Maj. Gen. Hassan Firouzabadi was quoted by state-run Press TV on Tuesday as saying “the Iranian nation cannot be threatened.”
On the contrary, general — it can. “Let’s remember that Iranian actions are not to deter military attack,” said Charles Krauthammer on the Fox News Channel last Friday. “Iranian actions are to deter sanctions.” The reason why Iranian officials took the extraordinary step of risking war with the U.S. by threatening to close the Strait of Hormuz — through which a third of the world’s sea-borne oil passes — is that they know tough sanctions could eventually bring about the end of their unpopular regime.
And it is not just the measure regarding petroleum sales that worries Tehran’s ayatollahs. The recently enacted American sanctions law designates the “financial sector of Iran, including the Central Bank of Iran” a “primary money laundering concern.” This seemingly arcane provision packs a potent punch, as it will essentially prevent Iran’s banks from conducting transactions in dollars.
To understand why this is such a frightening prospect, it’s necessary to recall George W. Bush’s dealings with North Korea. In September 2005, his administration, in order to put pressure on Pyongyang, declared Banco Delta Asia a primary money-laundering concern. The tactic worked so well against the Macau-based financial institution, which North Korea employed to handle external financial dealings, that the country was completely cut off from the global financial system. Pyongyang then had no way to transfer cash except by using its diplomats as mules, who for months were ferrying across the globe large-denomination American currency in bulging suitcases.
North Korea, not surprisingly, decided to return to the then-stalled six-party denuclearization talks. Unfortunately, under pressure from Beijing, Washington lifted the designation in 2007 and returned $25 million in frozen cash prematurely, before Pyongyang actually disarmed itself. Nonetheless, Washington developed a strategy to bend the will of the otherwise intransigent North Korean regime.
The Iranians watched this drama play out and know what the new American sanctions legislation can do to them. That is why President Obama, with smart strategy, can disarm Iran without using force.
And how would he do that? First, he needs to avoid the lure of talking too soon to the Iranians, even though they may be as little as a year away from being able to build a crude nuclear weapon, as Defense Secretary Leon Panetta said last month to CBS News. On the last day of December, just as Obama was signing the bill containing the new sanctions, an Iranian news agency reported that Alireza Sheikh Atta, Iran’s ambassador to Germany, announced that his government expected a new round of talks with the so-called 5+1 Group, the five permanent members of the Security Council plus Germany.
For the better part of a decade, Tehran has been engaged in fruitless discussions with the international community about its nuclear program, essentially stalling as its technicians in underground bunkers developed nukes and improved the country’s long-range missiles. The Iranian government needs to feel pain first before it will engage other nations in good faith.
Soon, with all its banks cut off from dollar transactions, it will for the first time have reason to come to terms. Financial sanctions are by no means risk-free — the Iranian military could still lash out in the Strait of Hormuz or elsewhere — but these measures are the best of a set of horrible options the international community now possesses.
