Increasing sanctions pressure on Iran now would cause our international partners to pull out of regime
The sanctions regime against Iran has always been difficult to maintain because China and Russia have growing economic interests in Iran that are being undercut by the sanctions. Additionally, the P5+1 countries have been wary of escalating the sanctions because they are trying to avoid an escalation that causes the negotiations to collapse, leading to war. Due to these sensitivities, any further movement to tighten sanctions on Iran (especially after agreeing not to in the nuclear deal) would collapse the multilateral cooperation necessary for the sanctions to function.
Why did the world suddenly crack down on Iran? Partly, it’s because the United States threatened that companies doing business with Iran would lose access to the American market. But America had been leveling that threat since the mid-1990s, and until 2010, foreign governments had largely ignored the threat. In 1996, for instance, after Bill Clinton signed a law giving the United States the right to bar foreign companies that invested in Iran’s energy sector from doing business in the U.S., the European Union threatened to take the United States to the World Trade Organization, and Clinton backed down.
Things changed in 2010 because the Obama administration—aided by the antics of then-Iranian President Mahmoud Ahmadinejad—convinced European and Asian governments that the only way to get a diplomatic deal with Tehran was to apply economic pressure first. This global pressure has now isolated Iran from the world economy in a way that American pressure alone never could.
But if the United States walks away from a deal that European and Asian governments support, those governments will not indefinitely maintain a sanctions regime that lacks domestic political support and costs them money. Last year, a report by the European Council on Foreign Relations warned that “those [in the United States] blocking implementation of a final deal … could endanger the international consensus backing sanctions against Iran.” If Congress torpedoes a deal, the report predicted, Europe might react “by easing its unilateral oil embargo against Iran.” In addition, “China and Russia … may become more sympathetic towards Iran’s position and see an opportunity to further advance their own interests at the expense of the US.”
MYTH: Additional sanctions will pressure Iran into dismantling its nuclear program.
REALITY: The international sanctions regime helped push Iran toward the negotiating table. Increasing sanctions at this time, however, violates the November 2013 Joint Plan of Action and risks pushing Iran toward escalatory measures and away from the negotiating table. Moving forward on any sanctions bill will give the hardliners in Iran considerable ammunition to assert that the United States is not following through on its commitments in the Joint Plan of Action and will not negotiate a comprehensive agreement in good faith. This could narrow the space that Iranian President Hassan Rouhani has to negotiate a final deal even further.
New sanctions could also cause Iran to pull out of the negotiations. Iran made clear last year that it would interpret such a move as a violation of the Joint Plan of Action. Iran's Foreign Minister and lead negotiator Mohammad Javad Zarif said that a "deal is dead" if the United States imposes more sanctions, even if they do not go into effect during the negotiations.
While complete dismantlement of Iran's nuclear program may have been the most ideal end-state, and possible a decade ago when Iran only had several hundred centrifuges, it is unrealistic and unnecessary. A final deal with stringent limits and intrusive monitoring and verification will guard against a nuclear-armed Iran and ensure that there is no covert program. Insisting on complete dismantlement of Iran's uranium-enrichment program also goes against the broad parameters for a comprehensive deal outlined in the Nov. 2013 interim agreement, which recognized that under a long-term agreement, Iran would have a limited enrichment program based on its "practical needs."
With respect to the alternative course proposed by the president’s critics, walking away and increasing the sanctions is not realistic. Sanctions on Iran are effective for many reasons — including the dominance of the United States in the financial world and the relatively low price of oil — but none is more important than the fact that these sanctions are not imposed by the United States alone. They are universal, and that’s why they’re effective. If the six countries on our side of the table reach an agreement with Iran that is scuttled by Congress, there is little or no possibility that our negotiating partners — especially China and Russia — will agree to extend and increase sanctions. And once the sanctions go from universal to unilateral, their effectiveness will decline steeply.
Although the president’s critics refuse to acknowledge it, the most likely outcomes of their approach are a nuclear-armed Iran or a war to prevent that result. Their alternative has the unintended effect of making the president’s approach look a lot better by comparison, especially if the final negotiations result in effective methods of verification.
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Critics of additional sanctions argue that a new sanctions bill now would have the opposite effect than it intends, that is, it will undercut the international sanctions regime and reduce pressure on Iran. According to this view, unilaterally imposed sanctions by the U.S. Congress in contravention to the JPOA will cause the negotiations to collapse, and the United States will be blamed for the result. This is in part due to the fact that the negotiating partners within the P5+1 including the US, agreed in JPOA that new sanctions applied during the negotiating period would be in direct violation of the agreement. As a consequence, support for the U.S. position will decline, and countries will use this opportunity to defect from the international sanctions regime, thus reducing the incentive for Iran to accept new limits on its nuclear program.
Counter-claim: To date, supporters of additional sanctions have not offered a direct answer to this claim, but one would imagine that the a new sanctions bill’s proponents would argue that Iran will not walk away from the negotiations (See Claim #1 above) or that at least with respect to the financial sanctions, the United States has the power to deter foreign banks from doing business with Iran.
Assessment: If the talks fall apart, and if the United States is blamed, then critics of new sanctions would appear to have a strong argument, but those outcomes represent probabilities not certainties. Even if this scenario were to take place, some countries would continue to honor some sanctions. Still, it would seem that on balance, the net result would be less pressure on Iran. Interestingly, many of the proponents of new sanctions are also critics of the JPOA, and they argue that the JPOA itself runs the risk of having sanctions unravel. If their logic is true, then it would bolster the position of this claim against additional sanctions, insofar as it suggests that the sanctions regime is fragile and that countries are just waiting for an excuse to do business with Iran. Under those conditions, new sanctions would seem to provide the very excuse the sanctions busters seek. In any case, additional sanctions now would threaten the entire JPOA agreement.
The idea that China, Russia and the European Union would maintain sanctions against Iran if Washington turned down a deal that they painstakingly negotiated and fully embrace is far-fetched. China is desperate to buy Iran’s (discounted) oil. Russia is already negotiating to sell it nuclear-power technology and machinery. And the French foreign minister has scheduled a trip to Tehran next week, presumably to do what that country’s diplomats always do: promote French corporate interests.
It is worth recalling that when the Obama administration was putting together the last round of U.N. sanctions against Iran, many Republicans dismissed the effort. In an August 2009 op-ed in the Wall Street Journal titled “Sanctions Won’t Work Against Iran,” the Bush administration’s ambassador to the United Nations, John Bolton, argued that the other major powers would never go along with such sanctions — and if they did, they wouldn’t change Iran’s behavior anyway. Now Republicans say that these same sanctions are wondrously effective, if only the administration would keep them on indefinitely.
The crucial reason the sanctions have been so effective — more than critics expected — is that they are comprehensive. Leaky sanctions, especially when the leaks are in major countries such as China, Russia and India, are worthless, perhaps even almost counterproductive. They don’t inflict much pain on the regime and actually benefit the hard-liners who control the few gateways in and out of the economy.
There is a profound gap between the United States and the world in the perception of the sanctions against Iran. For many in the United States, the sanctions are a mechanism to punish an evil regime. But for most of the other countries involved, the sanctions were enacted specifically to bring Iran to the negotiating table. These countries would not allow them to be turned into a permanent mechanism to strangle Iran. They all have relations with Iran, traded with it pretty freely until 2012, and intend to resume and expand these ties.
This is not in the cards. Edelman and Takeyh made their case as though the accord were between Iran and the United States. Nowhere do they take into account that it is a multilateral agreement, reached with not only America’s allies (France, Germany, and the United Kingdom) in the P5+1 negotiating team, but also China and Russia. Iran conceded as much as it did in the accord because sanctions and pressures on it are international in nature, and not just the result of American policy.
The unanimous vote on July 20 in the United Nations Security Council on creating a basis for lifting sanctions on Iran shows the significance of the multilateral dimension. At this late point, if the United States were to reject the Iran deal, the international sanctions regime would weaken, if not collapse. Allies and friends would blame America. They would view it as a feckless and weak leader and increasingly go their own way — not just on nonproliferation.
Further, the Iranian government might become even more determined to obtain nuclear weapons if the United States rejects the agreement. Iran’s interest in nuclear technology did not begin with the Islamic Republic. Shortly after India’s 1974 nuclear test, the Shah told a French magazine that Iran would acquire nuclear weapons “without a doubt and sooner than one would think.” And while the Iranian public may have eagerly greeted the nuclear accord in anticipation of sanctions relief, most Iranians still believe in their country’s inalienable “right” to conduct a peaceful nuclear program. A U.S. rejection that led the sanctions regime to erode, and obviated a monitoring regime that Iranian hardliners see as humiliating, would make it easier for Iran’s rulers to maintain a domestic consensus for continuing it.
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Though economic coercion should be attempted if the current round of diplomacy fails, this seems unlikely to work unless it is combined with a new set of incentives. First, it is improbable that a particularly strong international sanctions regime can be organized against Iran. Russia, China, and even many European states fear that the initiation of a strong sanctions policy, blessed by the UN, is the first step on the road to war. Sanctions may not change Iranian behavior, but they will have further committed the international community to do something about Iran's program. Some states also will oppose a strong sanctions policy because they profit from their relationships with Iran, due to its energy resources, or expect to profit even more if they help shield Iran from stern measures. Finally, given tight oil markets and high prices, most states would not support a sanctions regime that embargoed the export of Iranian oil. Second, though Iran is not a wealthy country, it has a relatively wellrounded economy. Aside from its obvious strengths in oil and gas production, Iran is endowed with abundant raw materials and agricultural land, and has a moderately well developed industrial sector. If a sanctions regime did not close off Iran's oil exports, it seems very likely that, with its own endowments and the cash it raises from energy exports, it could weather any plausible sanctions regime.
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Yet, how this symbolic victory of unity in the international community and isolation of Iran will eventually lead to a suspension of Iran's nuclear program is not at all clear. In characteristic form for Iranian negotiators, Tehran has refused U.S. and European offers while hinting of compromise just enough to delay any serious attempt to assemble an effective UN sanctions regime. Further, if the Security Council ever does acquiesce to U.S. pressure for sanctions, the result is unlikely to be a robust sanctions regime that includes the export of oil and gas or the import of gasoline, which would cripple Iran's economy and those of many other countries with it. China recently signed a multibillion-dollar oil and gas agreement with Iran, making Beijing a very unwilling participant in a serious sanctions regime. Russia is also unlikely to agree to tough sanctions. Russian defense minister Sergei Lavrov recently bluntly stated, "We cannot support ultimatums that lead everyone to a dead end and cause escalation, the logic of which always leads to force."1 Russia, in addition to the Bushehr reactor that it has helped to build over the last decade, has many other economic interests in Iran, not the least of which is the hope that Bushehr will be the first of many lucrative contracts to build Russian nuclear power plants in Iran. Even the French and British will be reluctant to back sanctions that would hurt their economies. A sanction that includes oil exports will hike oil prices to levels that the Islamic republic wagers is unbearable for Europe.
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Iran is an especially unpromising candidate for a successful campaign of economic coercion. Even if the United States can induce the major EU powers, Russia, China, Japan, and India to impose serious sanctions against Iran, the defection of one or more of those countries is very likely. All of them have important investments in Iran. Japan, for example, is extremely worried that if it goes along with a sanctions regime, China will swoop in and displace Tokyo's investments in Iran's oil industry. Some smaller countries may also defect from any sanctions regime. Australia, for example, has already voiced reservations about its participation.
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Sanctions. UN Security Council (UNSC) Resolution 1803 contains more sanctions that hurt the Iranian regime, but measures adopted so far are unlikely to produce significant divisions or even discussions within the Iranian leadership. Another UNSC resolution that is more substantial on refined products could produce results. Is it realistic? No, particularly after the crisis in Georgia. Concerning China, it is doubtful that Beijing would oppose a proposal already agreed by Moscow. And Beijing may also be willing to embrace more responsibility for upholding nonproliferation norms. But an agreement on refined products would be the most difficult to achieve (just below the impossible ban on energy exports), because Beijing is Iran's number one trade partner, particularly interested in energy: Sinopec, China's largest oil refiner, has concluded a multimillion- dollar deal in addition to the "deal of the century" for natural gas from Iran's North Pars gas field. In sum, sanctions are still worth trying, even on an essentially European/U.S. front, particularly as Iranian authorities face internal pressure, but without too many illusions concerning Russian and Chinese contributions.
With passage of the Iran nuclear deal almost certain, the author argues that opponents in Congress should work to oversee its implementation rather than try and derail it, as imposing new sanctions would "would undermine the credibility of the United States and — because other countries will relax sanctions regardless of what Washington does — give Iran the opportunity to reap economic benefits while continuing its nuclear program."
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A top German official warned Thursday of a “nightmare” and a “catastrophe” if Congress derails the Iran nuclear deal, and cited Germany’s unique relationship with Israel as a reason why it would not accept an agreement that endangers that country.
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