What You Need to Know About the Coming Deal With Iran
The author reviews and answers a number of common questions and arguments about the pending nuclear deal with Iran.
If the deal falls apart, especially if the U.S. is seen as the reason it falls apart - if Congress kills this deal - the sanctions regime will more or less collapse. Other countries aren't going to follow our lead. It doesn't matter if the Senate passes new sanctions. The other negotiating powers aren't going to go along with it.
This does not just mean Russia and China. It is also Japan and South Korea and Europe; the people who buy Iran's oil. And that means that Iran's economy will start to recover. The inspections regimes that are in place will end. The restraints on Iran's program will end. They will start installing thousands more centrifuges, enriching thousands of pounds of uranium and getting closer and closer to a bomb.
Whether they cross that line or not, they will clearly have the ability to build a weapon in a very short amount of time. That increases the risk of military action.
If Israel attacks Iran, if we strike Iran, it won't be a neat, little overnight strike, or two or three days of strikes. This will be weeks of bombardment against their hardened nuclear facilities, their air defenses, their ports and airfields. It will kill thousands of Iranians. It will be the beginning of a major war with Iran.
Former Secretary of Defense Robert Gates says that "if you think the war in Iraq was hard, an attack on Iran would, in my opinion, be a catastrophe." That is what we would be looking at; a major new war in the Middle East. That would be a disaster for the U.S., for Israel, and for the entire region.
Research conducted by experts from the International Campaign for Human Rights in Iran, has shown that Iranians themselves believe that a nuclear agreement between Iran and world powers will lead to internal political and cultural reforms in Iran. A recent report shows that "sixty-one percent [of Iranians] believe a deal would enable political and cultural reforms, as a politically strengthened Rouhani administration could now turn its focus to such issues."
The Executive Director of the Campaign, Hadi Ghaemi, believes that the nuclear agreement will "will have the potential to validate voices of moderation and embolden those who have called for a loosening of the political and cultural environment in Iran." Indeed, the Campaign asserts that, "every poll undertaken has confirmed Iranian society's strong support for the nuclear negotiations, and the resounding electoral win of the centrist Hassan Rouhani reflects society's desire for greater political and social freedoms."
Activists inside Iran see it as a beginning. As a way to empower Rouhani, who campaigned not just on economic stimulation, but on opening up freedoms for the Iranian people, and establishing a more moderate government. They think this will empower him and could be the opening that they're looking for.
[Question]: IAEA inspectors were quoted in The New York Times as saying the the job was so daunting that the inspectors frequently describe themselves as overwhelmed, monitoring a modern nuclear infrastructure with Betamax era equipment. Is that what we're dealing with?
This is what is going to change. The new agreement will rev everything up to twenty-first century technology. As Tim Mak wrote in a recent piece for The Daily Beast:
The International Atomic Energy Agency can field a sophisticated array of gadgetry to detect if Iran is departing from its obligations: fiber-optic seals on equipment that can signal the IAEA if they are cut; infrared satellite imagery that can track down hidden reactors; environmental sensors that can detect minute signs of nuclear particles; hardened cameras built to withstand tampering and radiation.
These aren't Game of Thrones wax seals on parchment paper. These are fiber optic seals where, if they're tampered with, they send a signal back to headquarters immediately, instantaneously. You no longer require, as these inspectors were talking about, old technology where there'd be sensors or cameras, and they'd have to inspect it weeks later to see if they had been tampered with.
As Andreas Persbo, a verification and compliance expert, has said, "with the present technologies that will be applied, you introduce an extremely fine level of monitoring into Iranian facilities. You could be very assured that the IAEA will detect even marginal, inconsequential breaches or movements from what the Iranians declare that they will do."
Iran desperately needs this deal. The sanctions regime put in place by the U.S., U.N. and EU has devastated the Iranian economy. Sanctions have been essential in pressuring the Iranians to come to the table and negotiate away key parts of their nuclear infrastructure. As a CRS report by Kenneth Katzman demonstrates:
Sanctions caused Iran to suffer its first gross domestic product (GDP) contraction in two decades -- about 5% contraction in 2013... Iran's economy is 15%-20% smaller than it would have been had sanctions not been imposed. Many Iranian businesses have failed, the number of nonperforming loans held by Iranian banks increased to about 15%-30%, and many employees in the private sector have gone unpaid or underpaid. The unemployment rate is about 20%.
Sanctions drove Iran's crude oil sales down about 60% from the 2.5 mbd of sales in 2011, reducing Iran's crude oil sales revenue from100 billion in 2011 to about35 billion in 2013 and even less in 2014... The JPA caps Iran's crude oil exports at about 1.1 mbd.
Sanctions caused the value of the rial on unofficial markets to decline about 56% from January 2012 until January 2014. The unofficial rate is currently about 37,000 to the dollar, and the government has repeatedly adjusted the official rate (currently about 27,000 to the dollar) to reduce the spread between it and the unofficial rate.
The drop in value of the currency caused inflation to accelerate during 2011-2013. The Iranian Central Bank acknowledged an inflation rate of 45% in July 2013, but many economists asserted that the actual inflation rate was between 50% and 70%. The sanctions relief of the JPA has helped reduce the inflation rate to about 30% currently.
Mr. Rouhani, the president of Iran, was elected on an economic reform package. But in order to do that, he has to end the sanctions, and in order to do that, he has to make a deal. He's up for reelection in two years; there are important elections next year in the parliament and their government bodies. He needs this deal in order to kick start the economy, in order to aid his political faction in the complex Byzantine Iranian political system.